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The Jersey Law Review – October 2006
MISCELLANY
TWO WRONGS DON’T MAKE RIGHTS
1 The Human Rights (Jersey) Law 2000 was registered as long ago as 16th June 2000; it has turned 6. The Human Rights (Bailiwick of Guernsey) Law 2000 was registered on 22nd January 2001 and is 5, approaching 6. Only very recently, and after the first draft of this piece had been written, did Guernsey confirm that its Law would come into force on 1st September 2006. A threat to petition Her Majesty in Council concerning Guernsey’s failure may have had some effect. Meanwhile, there is still no commitment from Jersey. It follows that fully 55 years after the United Kingdom ratified the European Convention for the Protection of Human Rights and Fundamental Freedoms and 53 years after the Convention was extended to the Bailiwicks, those rights and freedoms are still not a part of the domestic law of Jersey and have only just become a part of Guernsey domestic law.
2 Many fine words were uttered at the time making the case for incorporation of the Convention into Channel Islands’ domestic law. Examples from the Guernsey Billet (IX of 2000) included the following: “… it will provide easier access for local persons to the rights which they already have … the rights themselves will be brought much more fully into the jurisprudence of the local courts and their interpretation will thus be far more subtly and powerfully woven into our law. … the approach … so far adopted towards the Convention does not sufficiently reflect its importance to our citizens … The … Committee believes that the time has come to enable people to enforce their Convention rights against the insular authorities …”. The stumbling block appears to have been this, again taken from the Billet: “Although respect for the Convention rights has been required for close on 50 years, it would not be unreasonable to conclude that there are areas of law and practice in the Bailiwick which would probably not be defensible were complaints made to Strasbourg. Upon incorporation, persons claiming violations of their rights will be able to sue for an appropriate remedy in domestic courts …”. There’s the rub; a gloriously ironic vicious circle where the Convention would not be incorporated into domestic law because domestic law was not sufficiently Convention compliant.
3 The practical consequence of the failure to incorporate the Convention have already surfaced. In the Guernsey case of Johns v Minister of the Environment Department Collas, Deputy Bailiff held as follows -
“Until the Human Rights Law of 2000 is brought into force, there will be no obligation on the States or its decision makers to act in accordance with the Convention and there will be no domestic remedy available in this Court if they fail to do so, unless specific legislation says otherwise. To hold differently would mean that the Royal Court is giving primary jurisdiction to itself to enforce the Convention rights before the States of Deliberation intend the Court to have that jurisdiction.”
4 It is an extraordinary state of affairs. Perhaps interested parties in Jersey should consider their own petition requiring the States of Jersey to bring their legislation into force – an unedifying spectacle for Island jurisdictions perceiving themselves as both mature and aspiring to true autonomy; and all to the wrong-headed purpose of straining out a gnat whilst swallowing a camel.
HOPELESSLY IN DEBT
5 The problems of over-indebtedness and unscrupulous lenders have been much in the news recently. The scenario is familiar. A debtor becomes over-burdened and seeks advice from a loan company. A re-financing proposal is made which is superficially attractive but which involves the payment of interest at an exorbitant rate. Such stories are, according to its annual report, frequently heard at the Citizen’s Advice Bureau in Jersey.
6 What is the remedy for people in such a situation? In Re the désastre of Roach and Lamy the Court considered two applications by debtors who wished to declare themselves en désastre. Both were insolvent in the sense that they were unable to pay their debts as they fell due. Neither had assets which could immediately be realised for the benefit of creditors. The head note to the law report sets out the facts as follows -
"R was 64 and had incurred debts supporting his family after he was declared redundant in the early 1990s. He had obtained new employment and had kept up an agreed debt repayment programme, intending to work until 68, by which time his debts would have been repaid. He suffered a heart attack in 2004, however, which left him medically unfit to work. Subsequently, he received only incapacity benefit and would never have been able to repay his debts of approximately £21,000. The Viscount supported his application. He did not, however, support L’s application. She was 53, single and had an important and well-paid job. She had incurred debts of approximately £37,000 by overspending, which she claimed had been caused by a difficult and stressful relationship that ended in 2003. She has since taken out two loans to consolidate her debts, one of which she did not in fact use for that purpose, and had taken holidays abroad in 2003 and 2004."
7 The advantage from the perspective of the debtor of being declared en désastre is of course that he or she will usually be discharged from the debts at the conclusion of the désastre. In Roach and Lamy the Court held that it had discretion to grant a declaration even if there were not assets to be distributed amongst creditors, but that the discretion should be sparingly exercised as the process was primarily intended to create equality between creditors through the realization of a debtor’s property. In the event R was declared en désastre but L was not.
8 There is, however, another avenue of potential relief for a deserving debtor where there is evidence that the creditor has acted unconscionably. Although there is no statute in Jersey dealing with unfair contract terms, the customary law may come to the assistance of the debtor in certain circumstances.
9 In Steelux Holdings Ltd. v Edmonstone the Court stated, obiter, that fraud was a flexible notion and that silence could in certain circumstances amount to fraud. The facts in question were that the plaintiff sought to recover monies which he had originally lent to his step-daughter by a bond bearing no interest. After a period of time he had requested the step-daughter to sign a promissory note in place of the bond. The promissory note was interest bearing, but the debtor’s attention had not been drawn to this material difference, nor was she at that time legally advised. The claim for interest was abandoned during argument and no decision on the point was therefore necessary. The Court indicated, however, that the conduct of the plaintiff might have amounted to what in French law is called réticence dolosive which the Court characterised as dishonest or fraudulent silence. If the Court found that there had been dishonest silence, the obligation to pay interest would have been set aside.
10 Applying the principles examined by the Court in Steelux it is possible to envisage many situations where the failure of a lender expressly to draw the attention of a borrower to the true APR during the currency of the loan, or to the true consequences of the financial arrangements in question, might be held to amount to dishonest silence, entitling the Court to set aside any unfair contract term. Legal advisers to debtors should take note.
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