Jersey & Guernsey Law Review – October 2009
CASE SUMMARIES
The following key indicates the court to which the case reference refers:
JRC Royal Court of Jersey
GRC Royal Court of Guernsey
JCA Jersey Court of Appeal
GCA Guernsey Court of Appeal
JPC Privy Council, on appeal from Jersey
GPC Privy Council, on appeal from Guernsey
ADMINISTRATIVE LAW
Judicial review
In re X Children CA: (Birt, Deputy Bailiff, Beloff and Martin JJA) [2009] JCA 083
TVR Hanson for the guardian ad litem; H Sharp for the Minister for Health and Social Services; C Hall for X.
The guardian ad litem (the “guardian”) represented three child siblings (the “X children”) who had been severely damaged by physical and sexual abuse and neglect. The Minister for Health and Social Services was seeking final care orders in the Family Division committing the X children to his care. In this connection the Minister declined to provide the extremely substantial funding which was necessary for the X children to be placed in institutions in England which specialized in the treatment and rehabilitation of severely damaged children. Instead the Minister decided that the X children should be looked after in Jersey in residential accommodation developed specifically for them and other similarly circumstanced children on the basis that “it was in the best long term interests of the family” (the “decision”). In making the decision, the Minister was influenced by the plan (the “Williamson Implementation Plan”) which had been prepared with a view to implementing the recommendations of the Andrew Williamson Report into child protection arrangements in Jersey. The guardian, although aware of the gist of the plan, was denied sight of the document itself. Article 19(1)(a) of the Children (Jersey) Law 2002 provides: “(1) Where the Minister is looking after any child, the Minister shall ... (a) safeguard and promote the child’s welfare”. The guardian sought a judicial review of the decision on the grounds that the decision was illegal, irrational and vitiated by procedural irregularity. The Royal Courtdeclined the guardian’s application for a judicial review finding inter alia that art 19(1)(a) did not impose an unqualified duty on the Minister to adopt a particular placement option irrespective of the cost to the public. The guardian appealed to the Court of Appeal on the grounds inter alia:
(1) that the decision was illegal because art 19(1)(a) imposed a duty and did not merely confer a discretion on the Minister; and that in particular it did not allow a decision thereunder to have regard to the relative cost of possible placement options;
(2) that the decision had been vitiated by procedural irregularity because the guardian (a) had (albeit able to make written representations) been excluded from the critical meeting of the placement panel of 1 December 2008 whose recommendation in favour of the Jersey option conditioned the Minister’s own decision; (b) had been denied sight of the Williamson Implementation Plan; and (c) had been denied the opportunity to make oral representations to the Minister at the time at which he took the decision.
Held, granting the appeal on the ground of procedural irregularity:
(1) Article 19(1)(a) did not impose an unqualified obligation on the Minister. Such a construction was not supported by the language; was inconsistent with English case law on similar provisions in the Children Act 1989 (Re T[1]; R v Barnet London BC[2]); and there was no reason to exclude financial considerations from the factors to be taken into account by the Minister (R v East Sussex CC, ex p Tandy[3] distinguished; construction made by the Royal Court below confirmed; “public finances are not a bottomless pit”).
(2) There had been a change in the attitude of the courts as to the degree to which authorities making decisions affecting children and their parents had, as a matter of law and not merely good practice, procedural obligations to them. The right to a fair trial when civil rights are being determined embraced not merely legal proceedings themselves but steps taken before court in connection with them: Re R L (Care: Assessment; Fair Trial)[4]. The right to respect for family life gave substantive and procedural rights to parent and child alike. Authorities must involve parents properly in the decision-making process: Re G (Care: Challenge to Local Authority’s decision)[5]. These recent developments were illustrated in Children Law and Practice, ed. Herschmann and McFarlane, at para. 2760. The failure to allow the guardian to have sight of the Williamson Implementation Plan was in breach of the rule of natural justice that a person potentially affected in his rights or interests by a decision should have a reasonable opportunity to see and comment on matters which might be deployed to his disadvantage. Save in exceptional circumstances, such a breach flaws the decision. The court should not, other than in such circumstances, assume that the disadvantaged person would have been unable to influence the decision if he had enjoyed the opportunity denied him: R v Chief Constable of Thames Valley Police Ex p Cotton[6]. Even if aware of the gist of the plan, the guardian was in no position to address the substance of what was a highly influential document in reaching the decision. On this ground the appeal was allowed and the decision quashed.
CIVIL PROCEDURE
Security for costs—non-resident plaintiffs
Leeds United Association Football Club Ltd v Phone-in Trading Post Ltd (trading as Admatch) CA: (Sumption, Nutting, and Jones JJA) [2009] JCA 097
P Sinel for the appellant; RL Weston as director of the respondent.
The defendant, a Jersey company, was sued on a debt of £190,400 by the second plaintiff, an English company. The defendant was at all times unrepresented by an advocate but was represented by one of its directors and assisted by his wife. The director and his wife averred that, through an associated company which employed them, the defendant was charged, at least by way of book entry, £181 per hour for their services in connection with the action. On appeal from a decision of the Master, the Royal Court[7] granted the defendant’s application for security for costs against the second plaintiff on the basis that the defendant company should be treated as a litigant in person for the purposes of Rule 12/6 of the Royal Court Rules 2004. Under Rule 12/6 a litigant in person is entitled to his “actual pecuniary loss” in representing himself, up to a maximum of two thirds of the amount which would have been allowed if the litigant had been represented by an advocate. Distinguishing, in the Jersey context, the English Court of Appeal decision Nasser v United Bank of Kuwait,[8] the Royal Court held that a practice of ordering security for costs from non-resident plaintiffs by reference to the likely costs of defending the claim, applied in accordance with the principles laid down in AE Smith & Sons Ltd v L’Eau des Iles (Jersey) Ltd,[9] was in pursuit of a legitimate objective and proportionate and therefore did not amount to a breach of art 14 of the ECHR (prohibition on discrimination). The Royal Court ordered the second plaintiff to pay a total of £263,500 security for costs. The second plaintiff appealed.
Held, granting the appeal:
(1) The English Court of Appeal held in Nasser that an order for security for costs was not in itself contrary to art 6 of the European Convention on Human Rights (right to a fair trial); but to treat the foreign residence of the plaintiff as prima facie justifying such an order discriminated against him contrary to art 14 (non-discrimination in the enjoyment of Convention rights). The Court of Appeal held in Nasser that there had to be some objective justification for an order for security for costs in the particular case, based on some real obstacle or burden associated with enforcing a judgment for costs in the country or countries where the plaintiff had his assets.
(2) The court below had been mistaken in taking the view that the practice of making orders for security for costs against non-resident plaintiffs was not contrary to art 14 of the Convention. Article 14 prohibits discrimination on various grounds (“sex, race, colour ...” etc) and includes the sweep-up term “or other status”. The sweep-up term referred to any characteristic of an individual which could be described as personal to that individual: Kjeldsen v Denmark,[10] R (S) v Chief Constable of South Yorkshire Police.[11] Settled residence in a distinct territory is a personal characteristic in this sense: R (Carson) v Secretary of State for Work and Pensions.[12] In the case of companies, both under English and Jersey law, domicile depended on the place of formal incorporation or registration. A Jersey company thus had, in the relevant sense, a distinct status from a company incorporated within the UK. Article 7(1) of the Convention makes it unlawful for any public authority (including a court) to act in any way which is incompatible with a Convention right. Article 14 thus extended to discrimination by the court between a Jersey and UK litigants, including corporate entities.
(3) Protecting the interest of a defendant in being able to enforce a judgment for costs was a legitimate aim. A blanket presumption, however, that security for costs is appropriate whenever the plaintiff is resident outside Jersey was not a proportionate way of achieving that objective. There had to be some objective justification for an order for security for costs in the particular case, based on some real obstacle or burden associated with enforcing a judgment for costs in the country or countries where the plaintiff had his assets: Nasser, followed. In considering each particular case, the question was not what may happen in worst case scenarios but what was likely to happen. Contrary to the view of the Royal Court, the court doubted that it would generally impose undue, additional demands on the court’s time to decide the matter depending on the circumstances of each case. In the present case, where the plaintiff was resident in England, the additional cost in registering and enforcing a Jersey judgment in England pursuant to Part 1 of the Foreign Judgments (Reciprocal Enforcement) Act 1933 were small, the procedure was not problematic and there was no reason to think that registration would be set aside in the present case under the limited grounds provided by statute. Even if this were the case, the practice, applied as a blanket rule, was disproportionate in principle to its objective.
(4) The court below misapplied Rule 12/6 in assessing the amount required for security for costs. It had been the practice in Jersey for many years to allow companies to appear as of right by their directors or other officers. However it seemed highly doubtful to the Court of Appeal that a company could ever be a “litigant in person” for the purposes of Rule 12/6. The Rule had been drafted on the assumption that a “litigant in person” was a natural person and not a corporation. The Royal Court had sought to get around this difficulty by treating the director and his wife as if they were the litigants in person and proceeding on the basis of their normal working hours. However, if there was a litigant in person, it would be the defendant company and it would be the defendant company’s actual pecuniary loss which was relevant for the purposes of Rule 12/6 and not that of the director and his wife. The only actual loss adduced that might be relevant was the liability of defendant company to pay the related company for the services of the director and his wife. However this was not “an actual pecuniary loss”—even if enforced and not left outstanding as a book entry—but rather the price of value received. Rule 12/6 was not concerned with the cost of paying an agent to represent a litigant but only with the loss suffered by a litigant who was acting without one. Nor was it designed to enable a living to be made out of the litigation. The Court of Appeal agreed with the Royal Court that Rule 12/6 required reconsideration in relation to companies and self-employed individuals.
Striking out pleadings—special strike out jurisdiction
Alhamrani v Alhamrani CA: (Beloff, McNeill and Martin JJA) [2009] JCA 145B
MHD Taylor for the plaintiffs; NM Santos Costa for the first defendant; JP Speck for the second defendant; TVR Hanson for Sheikh Fahad Ali Alhamrani (Third Party); PC Sinel for Trustcorp (Jersey) Ltd.
The first two defendants (the “appellants”) appealed the decision of the Royal Court not to hear substantive argument on, and therefore dismissing, their summons at an advanced stage in lengthy litigation that the plaintiffs’ claims be struck out in their entirety on the grounds that the plaintiffs dishonest and contumacious conduct in bringing the claims: (a) had so corrupted the trial process that there is a substantial risk that a fair trial is not possible; and/or (b) amounted to a conspiracy to pervert the course of justice and was such an abuse of the court’s process that the claims should in any event be struck out in the interests of the administration of justice. The appellants’ specific arguments against the Royal Court’s decision not to hear their strike-out summons are summarized below. The complaint of the appellants was that the plaintiffs had engaged in a deliberate attempt to undermine or corrupt the whole process by falsifying evidence, giving false evidence and destroying documents.
Held, rejecting the application:
(1) Although there was no Jersey case, the ability of a court in Jersey to exercise a draconian special strike-out jurisdiction, rooted in the fundamental obligation to do justice between the parties, was not in doubt. The occasions would be rare. The jurisprudence in England was developing but the following propositions could be adopted:
(a) the jurisdiction exists to serve the ends of justice: Hamilton v Al Fayad (No 2);[13]
(b) the jurisdiction is a discretionary one, and there were strict limits for interference by the Court of Appeal in any discretionary decision of the Royal Court;
(c) the discretion can be exercised before or during a trial;
(d) the jurisdiction is not a penal one;
(e) without prejudice to (b), if a litigant’s conduct puts the fairness of the trial at “unacceptable risk” (so that any judgment in favour of a litigant would be regarded as unsafe) a court is bound to refuse that litigant to take further part in the proceedings, and (if the litigant is a claimant) must determine the claim against him. “Unacceptable risk” was to be preferred to “in jeopardy” and “at real” or “substantial” risk (concepts used in Arrow Nominees v Blackledge[14]);
(f) further, the jurisdiction may be exercised in such circumstances as where the conduct of the litigant is (without preventing a fair trial) detrimental to the administration of justice generally and a diversion of court resources (Arrow Nominees, per Ward LJ at 171). The court reserved its position as to whether the grounds could extend any further than this. There were other sanctions, such as an award of indemnity costs. Denying a litigant the chance of adjudication in any additional circumstances might infringe his rights under art 6 (fair trial) of the ECHR or be regarded as penal;
(g) no litigant has a right to compel a court to entertain an application in extenso or at all. The court must be wary of acceding to invitations to take short cuts which may ultimately prove circuitous: Ashmore v Corpn of Lloyds[15]; as to the danger of allowing preliminary points to be taken, see also Tilling v Whitman[16]; JFSC v A.P. Black[17]; O’Brien v Marett [18]. The judge is the conductor of the proceedings; he is not simply there to dance to the litigant’s tune;
(h) the decision in this case, albeit in an unusual context, had essentially been one of case management. The Court of Appeal exercises particular circumspection in overruling first instance decisions of case management: Alhamrani v Alhamrani;[19]
(2) Misconduct by a party which seeks to engage the relevant strike-out jurisdiction is not itself a ground for denying it: Masood v Zahoor.[20]
(3) In the present case, the Court of Appeal rejected the appellants’ claim that the Royal Court had not given them a fair opportunity to address the issue whether their strike out application should be heard at all; nor had the decision below been plainly wrong or substantively unfair; and the Royal Court had neither taken into account irrelevant considerations nor failed to take into account relevant considerations. Late or inadequate disclosure and the exposure of inconsistent evidence were common features of hotly contested litigation, providing fertile ground for cross-examination, entitling the court to draw adverse inferences and assisting it reaching the right conclusion. Only rarely would such features result in a court being unable fairly to conduct a trial: a court should not be lightly be persuaded that it is unable to perform its primary adjudicative role. In the present case, the Royal Court was apprised of the relevant matters and weighed them in a rational, proportionate and judicious manner. There was no basis for the Court of Appeal, necessarily deprived of the advantages of the court below, to interfere with its decision.
Comment: [JMR Renouf] This is a pragmatic and principled decision of the Court of Appeal made in the context of proceedings of unprecedented length and cost in Jersey. It recognizes that imperfect disclosure and inconsistent evidence is a constant reality of litigation which opposing advocates and the Jersey courts are generally well equipped to handle, whether by cross-examination, the making of appropriate costs orders or drawing of adverse inferences. Only in rare circumstances should such factors result in the fair trial of the matter being deemed at unacceptable risk such as to merit a party’s strike out: “a court should not lightly be persuaded that it is unable to perform its primary adjudicative function”.
The decision of the Court of Appeal suggests that the pendulum may have swung too far towards the striking out of cases for litigation misconduct, and that cases such as Arrow Nominees v Blackledge [2000] EWCA Civ 200 in which such a strike-out was deemed appropriate should be extremely rare. References in the present case to the overriding objective to do justice between the parties, and to the implications of human rights protection enforce this perception, as does the approval of the potentially high, but flexible, threshold of an “unacceptable risk”. The court preferred this formulation to other permutations appearing variously in Arrow Nominees, including “real”, “substantial” or “serious” risks of a fair trial not being possible, or of the same being at “jeopardy”.
Whilst this judgment provides some clarity in setting out examples where a strike out would perhaps not be appropriate it leaves some ground for continued doubt. For example, exactly how the Jersey courts will later determine the concept of “unacceptability” remains to be seen, with no real explanation for the preference of the term over others having been offered by the Court of Appeal. Notions of unacceptability are subjective, and what might be unacceptable to one trial judge may not be so to another. This is clearly an area in which the appellant court will wish to leave significant flexibility so that cases may be managed as most appropriate in each case, but it is not easy to see how the use of the adjective “unacceptable” advances the position. Instead, detailed examination of this decision will be required to fully distil the high threshold which was obviously intended by the Court of Appeal to apply in such cases.
CRIMINAL LAW
Proceeds of crime—saisie judiciaire
In re Kaplan Royal Ct: (Bailhache, Bailiff, and Jurats Le Breton and Clapham) [2009] JRC 082
J Harvey-Hills for the Representor; AJ Belhomme for the Attorney General; AJN Dessain for the Viscount.
The representor procured that proceeds from the flotation on AIM of his internet gaming business were paid into two Jersey trusts. The representor was subsequently charged with offences under anti-gambling laws in the US and had been in custody in the USA since 2007. In May 2007, on the application of the Attorney General, acting at the request of the US Department of Justice, the Royal Court ordered a saise judiciaire of the realizable property of the Representor pursuant to art 15(1) of the Proceeds of Crime (Jersey) Law 1999 and authorized the Viscount to take possession of and manage that property in accordance with the court’s directions. The principal assets of the Jersey trusts were land in Costa Rica and cash in Swiss bank accounts. In February 2008 the US Department of Justice obtained a seizure order in Switzerland freezing the Swiss assets. The present trustees were Liechtenstein entities; but the former trustees, being two Jersey companies in the Basel group, had been unable to transfer the assets to the new trustees on account of the Jersey and Swiss orders and the fact that Basel employees had resigned as directors of underlying companies holding the land in Costa Rica. The administration of the trusts was therefore in limbo. Pursuant to art 16(6) of Schedule 2 of the Proceeds of Crime (Enforcement of Confiscation Orders) (Jersey) Regulations 2008, the representor now sought the discharge of the Jersey saisie judiciaire. The representor argued inter alia that (a) the dual criminality test in art 1 of the 1999 Law in respect of the definition of “criminal conduct” was not satisfied in relation to the offences for which the representor had been charged in the US; and (b) there was no realizable property in Jersey and therefore no grounds for maintaining the saisie.
Held, granting the application:
(1) It was inapt to speak of a burden of proof in the context of the exercise of discretion in public law proceedings of this kind: In re O’Brien.[21] The question for the court on an application to discharge a saisie judiciaire is whether, having regard to the policy objectives of the 1999 Law, it is fair, reasonable and proportionate to maintain the order in force. No burden of proof was placed on either the applicant or the Attorney General but all relevant considerations had to be weighed by the court before arriving at a conclusion.
(2) The words of the statute must be given their proper meaning; but nonetheless the language employed should, having regard to the purposes of the 1999 Law, be construed in such a way as to accommodate the widely different procedures in other jurisdictions designed to penalize the concealing or laundering of the proceeds of serious crime.
(3) An external confiscation order was one made, inter alia, for recovering property obtained by “criminal conduct”; art 1(1) included within the definition of “criminal conduct” any conduct corresponding to an offence specified in Schedule 1; Schedule 1 specifies the relevant offences as being any Jersey offence punishable by one or more year’s imprisonment. Applying the broad construction referred to above, what was alleged by the US authorities was inter alia that the representor had conspired with others to conduct an unlawful gambling business. In Jersey a conspiracy to commit a criminal offence is itself an offence. Article 2 of the Gambling (Jersey) Law 1964 makes all forms of gambling unlawful except as provided by Regulation. Internet gambling had not been made lawful by any such Regulations. Internet gambling was therefore unlawful pursuant to art 2 of the 1964 Law. A conspiracy to conduct an internet gambling business is an offence under the law of Jersey for which the punishment is at large, i.e. the offender is liable on conviction to imprisonment for more than one year. It followed that the dual criminality test was satisfied.
(4) The effect of art 16 of the Schedule to the Proceeds of Crime (Enforcement of Confiscation Orders) (Jersey) Regulations 2008, and the definitions of “realizable property” and “property” in the Law was that only realizable property held by a defendant in Jersey vests in the Viscount (but the Viscount may require any specified person to repatriate to Jersey property held outside the jurisdiction). “Realizable property”, however, includes, under art 2(1)(b)(ii), “any property held by a person to whom the defendant has directly or indirectly made a gift caught by this Law” and, under art 2(1)(b)(iii), “any property to which the defendant is beneficially entitled”. It was common ground that the representor held no property directly in Jersey; but the representor was the effective settlor of both Jersey trusts and the trust property was thus caught by art 2(1)(b)(ii). It was unnecessary to determine whether the trust property was also caught on the grounds that that the Representor (as merely the object of a discretionary power under the trusts) was “beneficially entitled” to the trust property for the purposes of art 2(1)(b)(iii). The trust property was held and controlled by two Jerseycompanies (the former trustees). For the present purposes it was immaterial that that the underlying assets were situate in Costa Rica and Switzerland.
(5) Having rejected the representor’s arguments that the order should not have been granted, proceeded to determine whether as a matter of its discretion the order should now be discharged. On the facts the balance tipped in favour of discharging the order because:
(a) under art 16(4) of the 1999 Law, the Viscount was under a duty to take possession and manage the realizable property subject to a saisie. In the present case he was unable to fulfil that duty. The assets in Switzerland had been frozen as a result of the Swiss court order. The assets in Costa Rica consisted principally of immovables which were beyond the Viscount’s reach. It was inappropriate to allow the Viscount to remain in this impossible position;
(b) the maintenance of the saisie judiciaire would also be unfair to Basel, as former trustees. They continued to hold the trust assets and were in an impossible position in the current circumstances but had acted with propriety throughout;
(c) generally speaking a saisie judiciaire under the 1999 Law should be confined to realizable property situated in Jersey. Although there may be occasions where it is appropriate for the Viscount to seek repatriation of assets situated outside Jersey, the court should be slow to assume the functions of the world’s policeman. This was consistent with King v Serious Fraud Office[22] (albeit that the UK legislation was not identical).
Employment law—Employment Protection (Guernsey) Law 2008
Good v Credit Suisse (Guernsey) Limited Royal Ct: (Collas DB) GRC No.27/2009
SR Geall for the plaintiff; JE Roland for the defendant.
The plaintiff was dismissed summarily by the defendant and subsequently brought a claim for unfair dismissal pursuant to the Employment Protection (Guernsey) Law 2008. He also brought proceedings in the Royal Court for breach of contract. In those proceedings he claimed “stigma” damages arising from the manner of his dismissal, which he alleged to be in breach of the implied term of trust and confidence. The defendant applied to strike out the material paragraph of the cause. The plaintiff argued that English case law should not be followed, that French law and the Code Civil should be considered and stigma damages found to be a part of Guernsey common law.
Held, Granting the application and striking out the claim for stigma damages:
(a) The Guernsey statute had been modeled on English legislation and had adopted principles of English law and adapted them to suit the needs of the jurisdiction.
(b) It was therefore not appropriate or helpful to introduce new concepts from French law into Guernsey employment law.
(c) The right of an employee not to be unfairly dismissed was a statutory right with a statutory remedy. If the legislature had not intervened in this area, the courts might have developed a common law remedy, but they were no longer free to do so.
(d) The courts were not now in a position to develop implied contractual terms that would apply to a dismissal. The implied terms of trust and confidence applied during the contract but did not apply to any dismissal.
e) Consequently, the Guernsey courts were not able to develop common law remedies to enable an employee to recover damages for any loss he suffered arising from the manner of his dismissal, whether by way of loss of reputation, stigma or otherwise.
FAMILY LAW
Ancillary relief—disclosure of documents—Children Rules 2005
Re D Royal Ct: (O’Sullivan, Deputy Registrar, Family Division, sitting alone) [2009] JRC067A
HJ Heath for the husband; CRG Davies for the wife.
The wife alleged that the husband had assaulted her. The husband wished certain documents filed in connection with proceedings in the Family Division to be disclosed to the police legal advisers on the basis that the police should have all the relevant information available to them before deciding whether or not the husband should be prosecuted. Rule 25 of the Children Rules 2005 provides that no document held by the court relating to the relevant proceedings may (except as stated therein) be disclosed without the leave of the court. The husband sought such leave.
Held, granting the husband’s application:
(1) There was no reported Jersey case on the principles for granting such leave. English case law was of assistance. A defendant in a criminal trial should have all the necessary material for the proper conduct of the defence: In re D (Minors) (Wardship: Disclosure).[23] The following matters should be taken into consideration (Re C (A Minor)(Care Proceedings: Disclosure))[24]: (i) the welfare and interest of the child or children concerned in the care proceedings; (ii) if any child is likely to be adversely affected by an order in a serious way this will be an important factor; The welfare and interests of other children generally; (iii) the maintenance of confidentiality in children cases; (iv) the importance of encouraging frankness in children’s cases; (v) the public interest in the administration of justice—barriers should not be erected between one branch of the judicature and another because this may be inimical to the overall interests of justice; (vi) the public interest in making available material to the police which is relevant to a criminal trial (and in many cases, this was likely to be a very important factor); (vii) the gravity of the alleged offence and the relevance of the evidence to it.
(2) It is not necessary that a document will with certainty assist the defence. A judge sitting in a family court should be cautious before concluding that a document should not be disclosed on the footing that it cannot assist the defence for it is the defence who have responsibility for the conduct of, and the best knowledge of, the case which they wish to present: Re Z (Children) (Disclosure: Criminal Proceedings).[25] Further considerations were set out in A District Council v M.[26] Conditions on the use of the documents may be imposed.
(3) Applying the above principles, the court exercised its discretion to allow disclosure of the documents to the police but only for the purpose of determining if the documents would undermine the prosecution case or affect whether it was in the public interest to prosecute the husband. Certain names of children were to be omitted. If a decision to prosecute was to be made, a further application by the Crown would need to be made to the court.
Ancillary relief—claims against property in name of third party
O’Brien v Marett CA: (Beloff, McNeill and Martin JJA) [2009] JCA 145
P Tracey for the appellant; M St J O’Connell for the first respondent; N Journeaux for the intervenor; the second and third respondents did not appear and were not represented.
In proceedings for ancillary relief, the wife alleged that the husband had an undisclosed beneficial interest in certain property held by the third party (the “third party”) and his wife (the “intervenor”). The claim had been long-running and remained contested. On 29 April 2009 Bailhache B, rejected a formalistic approach to pleadings (based on TL v ML[27]) where property in the name of a third party was claimed by a spouse, and taking into account the length of time that the case had already taken, gave directions that the wife’s pleading be amended with a view to clarifying the interest which the husband was alleged to have in the relevant property, whether the wife sought the proceeds of sale or a share of the property itself and the legal basis for the wife’s claim. The third party and the intervenor sought leave from the plenary court to appeal this decision on the ground that the wife should have been ordered to serve full pleadings on the third party and the intervenor.
Held, dismissing the appeal:
(1) The court below had not determined any substantive point between the parties of law or fact. The decision of 29 April 2909 was to be characterized as a case management decision.
(2) As against the formalistic approach to pleadings in relation to claims to third party property set out in TL v ML, the Court of Appeal were more inclined to accept the less prescriptive approach of Mumby J in A v A, St George Trustees Ltd.[28] Vigorous case management is vital, but the appropriate directions in any particular case must reflect the case-managing judge’s appraisal of how, given the forensic realities, the particular issues can best be resolved in the most just, effective and expeditious manner. Matrimonial cases can readily be seen to fall in a special category: the third party may well already have a general knowledge of that part of the affairs of the husband and wife which bring them all into the same litigation and there may be particularly acute concerns regarding the cost and expedition of such proceedings. It is peculiarly a matter within the discretion of such a trial judge in matrimonial proceedings to be able to direct to what extent, in the whole circumstances of the litigation, there should be written pleadings with a particular degree of specification. Whilst the argument for leave had some strength, in the present case the court agreed with the court below that these proceedings needed to be expedited to a conclusion.
(3) The case for leave to appeal in the present case came nowhere near suggesting that the decision was so seriously flawed either in principle or having regard to the underlying facts that no reasonable trial judge could have issued them. Leave to appeal was refused.
LAND LAW
Contract—restrictive covenant—interpretation
La Petite Croatie Ltd v Ledo Royal Ct: (Clyde-Smith, Cmmr. and Jurats Bullen and Le Cornu) [2009] JRC 090
NSH Benest for the plaintiff; RA Falle and SJ Young for the defendant.
The plaintiff sought a permanent injunction restraining building works to the south of his property which he argued was in breach of a restrictive covenant in his favour. On 18 December 2008 the court (consisting of the same judges) declined to grant the plaintiff an interim injunction on the ground that the plaintiff’s case that the whole of the proposed building was in breach of covenant was not seriously arguable: La Petite Croatie Ltd v Ledo.[29] The plaintiff nevertheless proceeded to seek a permanent injunction. The case turned on the construction of the relevant covenant as regards the precise area of land which was affected by it.
Held, dismissing the plaintiff’s claim:
(1) The general rule is that the intention of the parties who created the restrictive covenant must be gathered from the words used: Blackburn v Kempson.[30] Assistance may be found in the rules of interpretation set out by Pothier, Traité des Obligations, Tome 1, Article VII (1821). However caution must be exercised in applying those principles in the case of deeds concerning immovable property since such contracts create real rights which affect others than the initial parties, and there are special rules, such as the presumption for freedom in relation to servitudes: Haas v Duquemin.[31] Furthermore, all contracts must be construed against the background of the surrounding circumstances or matrix of facts: In re Internine Trust.[32]
(2) The general principle is that where the intention of the parties has been reduced to writing it is not permissible to adduce extrinsic evidence of their subjective intentions: Internine. However, following English law, there are a number of exceptions to the rule. One well-established exception is in relation to conveyances of land: Halsbury’s Laws of England, 5th ed, vol 4(1), para 929); Neilson v Poole.[33] A latent ambiguity—that is, an ambiguity not apparent on the face of the document but which arises when its relevant terms are applied in practice—may be resolved by adducing extrinsic evidence, subject to the crucial qualification that the evidence must be of probative value: Ali v Lane.[34]
(3) Servitudes were not found in the customary law but were an import from civil law. In order for the plaintiff to succeed in such an action it had to be able to define with precision: (a) the fonds dominant, (b) the fonds servant and (c) the terms of the burden: Matthews and Nicolle, Jersey Law of Property, at 1.38; Domat, Loix Civiles; Colesberg Hotel (1972) Ltd v Alton Hotel Ltd.[35] Following Pothier, any ambiguity must be construed in favour of the fonds servant.
(4) The ambiguity in the present case (which depended on the location of a unit which had not yet been determined at the time when the contract was drafted) was latent. Probative extrinsic evidence was permissible; the covenant may have been void for uncertainty had the ambiguity not been resolved by extrinsic evidence. The relevant extrinsic evidence comprised correspondence in 1993 between the original purchaser’s representative and the law firm acting for both parties at the time of purchase. Construing the present covenant on the basis of the above principles, and that extrinsic evidence, the restrictive covenant did not extend in the manner argued by the plaintiff and the action was dismissed.