| Return to Contents Case Summaries Civil Procedure Appeals Mayo Associates SA et au v. Cantrade Private Bank Switzerland (CI) Limited et au CA: (Carlisle, Gloster and Beloff JJA) September 26th, 1997 unreported. P. C. Sinel for the appellants; A. R. Binnington for the respondent. The appellants applied for leave to appeal against an interlocutory order made by the Bailiff in chambers. The order directed that their summons seeking an order that the court had no jurisdiction to grant the relief claimed in the respondent’s representation should not be heard as a preliminary issue but as one of the issues to be determined at the hearing of the representation. The appellants submitted that the Bailiff’s decision was plainly wrong and that the appeal court should intervene to order that the appellants’ summons be heard as a preliminary issue and that the Bailiff erred, as follows; first, by not directing his mind to the conflicting merits of the two applications, and the fact that the representation was doomed; secondly, by not accounting for the fact that the appellants’ summons could be dealt with speedily without the need to refer to any of the evidence filed and without the need for cross-examination, and thereby save costs; thirdly, by not accounting for the fact that the appellants had taken proper steps to challenge the representation which the court had declined to entertain. Held, dismissing the application: -
the decision to hear the appellants’ summons at the same time as a representation, or as a preliminary issue, was procedural and a matter of case management and thus in the judge’s discretion. The appeal court should not lightly interfere with that but should respect that decision unless plainly wrong; -
the Bailiff was entitled to conclude that it was more sensible to treat the jurisdictional point raised in the appellants’ summons as merely one argument to be considered in the context of the representation as a whole; that it might well be necessary for the court to consider the evidence upon which the representation was based in order to determine the jurisdictional issue; and that the determination of the representation and the appellants’ summons would not and should not require lengthy cross-examination or the resolution of disputed factual matters that should more properly be left to trial; -
there was no reason to criticise the Bailiff for not considering either the merits of the representation in the context of the appellants’ summons, or the handling of the appellants’ challenges to the representation. The appellants’ first summons had been dismissed on procedural grounds and not pursued. The effect of their current summons would not be lost by not being heard as a preliminary issue. Civil Procedure Khan & another v Leisure Enterprises (Jersey) Limited, Dart and Richardson Royal Ct: (Bailhache, Bailiff) December 18th, 1997 unreported. M. J. Thompson for the first and second plaintiffs; M. St. J. O’Connell for the second and third defendants The plaintiffs brought proceedings against the first defendant, a Jersey registered company, and the second and third defendants, two of the directors of the first defendant. The plaintiffs alleged, inter alia, that the second and third defendants, as directors of the company, had breached various duties and or had been negligent in the manner in which they had conducted the affairs of the company. In particular, criticism was levelled at the directors for their decision to execute a power of attorney in favour of a firm of Spanish lawyers who then went on to dispose of an asset situate in Spain belonging to the first defendant. The plaintiffs claimed between them to hold a minority of the shares of the first defendant and brought proceedings by means of order of justice alleging breach of duty and/or negligence, and/or breach of trust and made a claim for damages for the benefit of the company. They also claimed alternatively on the basis of unfair prejudice pursuant to Article 141 of the Companies (Jersey) Law, 1991. The second and third defendants filed a defence in which they denied all the material allegations of wrong-doing made against them, and shortly thereafter issued a summons by which they sought to strike out the claim brought by the plaintiffs on the basis that the claim disclosed no cause of action. The principal ground upon which the strike out application was based was that the action was precluded by the rule in Foss v Harbottle, namely that it is a matter of general principle that minority shareholders cannot sue for wrongs done to a company, unless an established exception to the rule in Foss v Harbottle applies. The second and third defendants argued that the "fraud on a minority" exception was inapplicable in this case. Approximately one week before the strike out application was heard, the plaintiffs sought to file an amended order of justice which introduced a variety of additional claims into the pleading. The second and third defendants consented to the amendments but nevertheless pursued the application to strike out the order of justice in its amended format on the basis that, notwithstanding such amendments, it continued to disclose no reasonable cause of action. The amendments contained significant changes in the case adopted by the plaintiffs namely that in the original order of justice the plaintiffs asserted that they brought the action as representing the majority shareholders. In the amended order of justice, that assertion was deleted and the majority shareholders were joined as fourth, fifth and sixth defendants respectively. The second amendment was that the plaintiffs alleged in the amended order of justice that the second and third defendants had conducted themselves with "a lack of probity such as to amount to dishonesty". The amended particulars of such "dishonesty" were analysed at length during the course of the strike out application, the second and third defendants submitting that on any view the particulars of alleged dishonesty could not analytically amount to dishonest conduct, and should therefore be struck out on the basis that it is a cardinal principle that allegations of fraud should only be made where the allegations can be particularised with great care and accuracy. The alternative claim was that there had been unfair prejudice to the plaintiffs so as to give rise to relief under Article 141 of the 1991 Companies Law. The second and third defendants argued that it was not possible for such a claim to be made out in circumstances where the plaintiffs had failed to call a general meeting of the company and it was therefore impossible to say that there had been any "shareholder prejudice" in the absence of such a meeting. Held, (1) that the exception to the rule in Foss v Harbottle had not been made out. (2) That the second and third defendants did not cause the alleged prejudice which was caused, if at all, by the actions of persons other than the defendant directors. Accordingly the Court ordered that the order of justice be struck out. Consumer Credit Hire Purchase Mendonca v Le Boutillier and Cornec Royal Ct: (Hamon, Deputy Bailiff) May 14th, 1997 unreported. N. V. Pearmain for the plaintiff; D. M. Cubitt Sowden for the defendant. The third party did not appear and was not represented. The third party was lawfully in possession of a motor vehicle, the property of a finance company, to which he did not have title. He sold the vehicle to the defendant who bought in good faith and for value. The defendant, still acting in good faith, sold the vehicle to the plaintiff. The finance company repossessed the vehicle. The plaintiff sued the defendant for the recovery of the monies which he had paid for the vehicle. The defendant argued that he had acquired and transferred to the plaintiff good title, and that the plaintiff should not have allowed the finance company to repossess the vehicle but should have retained it. He cited in support of that argument the provisions of the Hire Purchase Act 1964 of the United Kingdom and Article 2297 of the Code Civil of France. Held, dismissing the action, that the finance company had retained ownership of the car and had been entitled to retake possession of it. In Roman law, from which Jersey takes its authority in the matter of contract, a person who has possession but not title cannot transfer title (nemo dat quod non habet). Where English statute or the French Code introduced an alteration to the pre-existing law neither can provide assistance in ascertaining what is Jersey law. Under Jersey law, a purchaser in good faith of a moveable which has been stolen or lost and then sold, even in market overt, can acquire a prescriptive title if he remains in possession of the movable for ten years but does not acquire good title within that period. Courts Mayo Associates S.A. et au v Cantrade Private Bank Switzerland (C.I.) Limited et au, Representation of Cantrade Private Bank Switzerland (C.I.) Limited, Royal Ct. (Bailhache, Bailiff and Jurats Myles and Potter) December 18th, 1997 unreported. P. C. Sinel for the plaintiffs; A. R. Binnington for the first defendant representor. The representor sought the appointment of the Viscount for the purpose of communicating or otherwise dealing with an open offer made by the representor to certain investors who had lost money as a result of trading activities which were the subject of the main proceedings. The representor argued that discovery of documents in the main proceedings had revealed that the plaintiffs, or their directors, had been guilty of misconduct in relation to the investment scheme which was the subject of the litigation and in relation to the conduct of the litigation itself such as to give rise to a conflict of interest which made them unsuitable to be custodians of the investors’ interest in the litigation. The representor therefore sought the appointment of the Viscount, either as administrator of the investors’ interest or pursuant to the Court’s inherent jurisdiction, in order to ensure that the terms of the representor’s offer were communicated to those investors with whom the representor was not in direct contact in a fair and impartial manner. The plaintiffs argued that the Court had no jurisdiction to grant the relief sought and that to do so would constitute an unjustified interference by the Court with the rights of the parties to the litigation. Held, granting the application, that the plaintiffs had a duality of interest and in the circumstances it was appropriate for the Court to exercise its powers under its inherent jurisdiction to enable the investors to consider the offer dispassionately. Whilst acknowledging the dangers of assuming disproportionate powers under its inherent jurisdiction and trespassing into the province of the legislature or rule-makers the inherent jurisdiction nevertheless had a useful role to play in the attainment of justice. Criminal Law Sentence Att. Gen. v Da Silva Royal Ct. (Bailhache, Bailiff and Jurats Le Ruez and Querée) December 4th, 1997 unreported M.C. St. J. Birt, QC, Attorney General, for the Crown; S. E. Fitz for the accused. The accused, a 22 year old male with one previous conviction for a minor offence, pleaded guilty to twenty-five counts of breaking and entering and larceny from various residential accommodation. In some instances the occupier had been present in the home as the offences were being committed, but had remained unaware of the accused’s presence. On two occasions the occupiers had discovered him in the home. The offences took place over a span of 10 weeks; some £9,000 in cash or property was stolen, of which only about £1,000 was recovered. Held, Att. Gen. v Gaffney (June 5th 1995, unreported) offered some guidance as to the appropriate level of sentencing for breaking and entering commercial premises. It was appropriate now to consider the appropriate level in cases involving dwelling accommodation. Having directed attention to the gravamen of such cases, and having reviewed the contemporary approach of the English Court of Appeal (particularly in R v Edwards and Brandy 1996, unreported), the Royal Court found it possible to offer some guidance. The sentencing bracket, supposing a guilty plea, would appropriately centre upon a term of two years’ imprisonment in the case of offences involving unoccupied dwelling accommodation, and upon a term of three years’ imprisonment in the case of occupied dwelling accommodation. Given the wide variety of circumstances encountered in these cases it was difficult to lay down specific guidelines. In particular, it was to be observed that any aggravating circumstances might lead the Court to impose a higher sentence. Equally, mitigating circumstances might counterbalance such features and might even on occasion lead to the imposition of a non-custodial sentence. In the instant case the accused was sentenced to a term of three years’ imprisonment. Criminal Procedure Dowse and Heys v Att.Gen. CA: (Carlisle, Gloster and Beloff JJA) September 26th, 1997 unreported. S. J. Habin and C. J. Scholefield for Dowse; J. C. Gollop and H. Tibbo for Heys; S. C. Nicolle, QC, Solicitor General, for the Crown. Both applicants had been convicted before the Royal Court, D on two counts, firstly, being knowingly concerned in the importation of a controlled drug and secondly, being in possession of a controlled drug with intent to supply, and H on one count, being knowingly concerned in the unlawful importation of a controlled drug. On the 11th July, 1997, the Court of Appeal allowed D’s appeal against conviction for being knowingly concerned in the importation of a controlled drug but dismissed his appeal against conviction for being in possession of a controlled drug with intent to supply, and allowed H’s appeal. The appeals were allowed on the ground of non-disclosure to the defence of evidence relating to the importation which became material during the giving of D’s evidence. At the time the Court of Appeal’s judgment was given no application and therefore no order was made as to the costs of the appeal or of the trial under paragraph (2) of Article 3 of the Costs in Criminal Cases (Jersey) Law, 1961, which empowers the Court to make such orders. The subsequent order of the Court which was issued provided for payment out of public funds of the fees and expenses in accordance with paragraph (3) of Article 3 of the Law which provides for the defrayment out of public funds of the fees and expenses of an advocate who has been assigned to an appellant by reason of the insufficiency of the appellant’s means, whether the Court makes an order under Article 3 or not. Subsequently both applicants made an application to the Court of Appeal for an order for costs under paragraph (2) of Article 3 in respect of the prosecution of their appeals and the carrying on of their defences. Held, -
the discretion which the Court has to make an order for costs includes a discretion to make an order in favour of an appellant who has been partially successful so far as the costs relate to the count upon which he has been successful, and similarly in respect of proceedings in the Court below extends to a discretion to make an order for the costs of the defence which can be identified as related to the charge upon which his appeal was successful; -
before the Court of Appeal can exercise its discretion under paragraph (2) of Article 3 an application to the Court should be made. The right time for making the application is at the end of the hearing of the appeal. If in future applications for costs are not made at that stage but at a later stage that will be one of the matters which the Court of Appeal will take into account in deciding in its discretion whether to make an order for the award of costs out of public funds. Criminal Procedure Snooks v Att. Gen. CA: (Bailhache, Bailiff, Carlisle and Beloff JJA) September 26th, 1997 unreported. C. E. Whelan and P. Mathews, Crown Advocates, for the Crown; S. E. Fitz for the appellant. The appellant was convicted of offences under the Customs and Excise (General Provisions) (Jersey) Law 1972 and the Misuse of Drugs (Jersey) Law, 1978 following his trial before the Inferior Number sitting en police correctionelle. At the conclusion of the evidence the Deputy Bailiff, as presiding judge, had summed up the case to the Jurats in open court. Hitherto, the usual practice had been for such summing-up to take place in chambers. In his appeal against conviction the appellant took as one ground of appeal that the Deputy Bailiff "should have abided by the same rules when summing-up in open Court to the Jurats as he would to a jury at Criminal Assize". Because the practice adopted by the Deputy Bailiff on this occasion had broken new procedural ground, the Court of Appeal invited submissions from counsel upon that practice generally. Held, as to venue: although there was no statutory requirement for the summing-up to take place in open court it was desirable that it should so take place. The accused and counsel would thus know what was being said at first hand. It would be recorded and a transcript would be available to assist the Court and all parties in the case of an appeal. as to content: the summing-up must contain full and adequate directions on all relevant matters of law, including a direction on the burden and standard of proof; no rigid formulae need be used in this area. Insofar as it touches matters of fact the summing-up may fairly take account of the differences of maturity and experience which are to be expected between a bench of jurats on the one hand and a randomly drawn jury on the other. It followed that very often the jurats will require no directions on how to approach and evaluate the evidence. In those cases where such directions are given, however, the summing-up is required to be even-handed as between the evidence of the prosecution and that of the defence, fairness being the necessary keynote of every summing-up. In the instant case the Court of Appeal found that the summing-up had not contained directions on the legal ingredients of a particular count on the indictment. The conviction on that count was accordingly quashed, and a slight reduction was applied to the overall sentence which had been imposed. Interlocutory Injunction Hughes v Clewley CA: (Le Quesne, Sumption and Clarke JJA) January 14th, 1997 unreported. P. Landick for the appellant; N.F. Journeaux for the respondent. In 1991 the respondent sold his yacht Siben to the appellant in exchange for, inter alia, a night club and a prostitution business in Portugal. Following the sale the yacht remained in the name of the respondent’s nominee company with the British Ships Register at St. Helier. The respondent became unhappy with the transaction. He commenced proceedings in the English High Court against the appellant alleging that he had been induced to purchase the night club as a result of fraudulent misrepresentations as to its profitability and as to the appellant’s legal title to the premises. He also obtained, ex parte from the Royal Court, an order under section 30 of the Merchant Shipping Act 1894 prohibiting the appellant from dealing with the yacht. At trial in the English High Court in September 1995 the respondent succeeded to the extent that the allegations of fraudulent misrepresentation were upheld but rescission (which would have led to the return of the yacht) was refused because the contract was held, in part, to be illegal by reason of the sale of the prostitution business. The appellant had amended his pleadings to allege that part of the consideration had been the prostitution business, and that this was a bar to rescission only at the commencement of the High Court trial. On 25th January 1996 the Royal Court heard the appellant’s application for an enquiry as to damages for the alleged wrongful imposition of the section 30 order on the grounds first that the claim to rescission had been rejected in the High Court, and secondly that the respondent had failed to disclose in his affidavits leading to the making of the section 30 order that it was a term of the agreement of sale that he would acquire the prostitution business. The Royal Court rejected the appellant’s application holding that the respondent had given no undertaking in damages, either express or implied, and that the appellant could not therefore recover any damages unless the respondent’s proceedings in Jersey were a wrongful abuse of process. The Royal Court held in relation to the first ground that proceedings were not wrongful, on the basis that the respondent’s claim to rescission established an "interested position" under section 30 and that the failure of his claim to rescission did not vitiate retrospectively that interest. As to the second ground the Royal Court held that the appellant had been at least as heavily involved in the prostitution business as the respondent and could have drawn the matter to the attention of the court had he wished. On appeal the appellant submitted that the enquiry as to damages should have been allowed because of the manner in which the section 30 order was originally obtained and then, at various stages, extended. Held, dismissing the appeal: -
that the appellant’s proper course, if he thought that the section 30 order had been irregularly obtained, would have been to apply to set aside the order at an earlier stage; -
that on such an application the decisive questions are (a) whether the outcome of the dispute justifies the order made at an interlocutory stage; and (b) if not, whether the facts found disclose reasons why, as a matter of discretion, an enquiry as to damages should nevertheless be refused. In the ordinary course, the enforcement of the undertaking will follow as a matter of course if the judgement at trial discloses that the interlocutory order was unjustified by the merits of the case as found by the judge; -
that whether or not the High Court judgement vindicated the respondent’s application for a section 30 order, it disclosed overwhelming reasons why, as a matter of discretion, the appellant should not recover damages. The fact was that the appellant had fraudulently brought about the transaction which gave rise to the transfer of the yacht and, therefore, to the Jersey proceedings designed to stop him disposing of his interest to third parties. The respondent had not acted unreasonably in applying for a section 30 order in Jersey and the proceedings in Jersey must be regarded as resulting from the appellant’s own conduct; -
that the respondent had not acted unreasonably because he always had an arguable case for rescission; -
that it was not necessary for the Court of Appeal to consider the question of whether there is an implied undertaking in damages by an ex parte applicant who does not give an express undertaking. Succession Formalities Of a Valid Will In the matter of the estate of Nellie Edna (otherwise Joan) Wainwright (neé Watson) deceased Royal Court: (Hamon, Deputy Bailiff and Jurats Le Ruez and Le Brocq) September 10th, 1997 unreported. S. Sharpe Crown Advocate amicus curiae The deceased had died domiciled in Jersey leaving a purported will of moveable estate. The will was entirely written in the deceased’s handwriting and was dated and signed by her. It would have been a valid holograph will had it not also been witnessed by two witnesses, one of whom was a legatee under the purported will. The Registrar of Probate declined to issue a grant of probate and applied to the Royal Court for directions. As there was no person willing to bring the matter to the Court, the Attorney General was convened as amicus curiae. The Attorney General made submissions following the questions raised by the Registrar’s application, namely whether - -
the document was a valid holograph will, being written, signed and dated by the deceased and the addition of the names of witnesses was otiose; or -
the document was not a holograph will and was invalid as a testamentary instrument because one of the witnesses was incompetent being a legatee; or -
although invalid as a testamentary instrument the document was nonetheless effective to revoke the previous will of the deceased, thus rendering the deceased intestate; or -
the deceased’s intention to revoke her previous will was dependent upon the efficacy of her new will.. The Court made the following observations. In Jersey, holograph wills had long been upheld as valid testamentary instruments. The purpose of the strict rules regarding the formalities of wills was to prevent so far as possible fraud and/or duress. A valid holograph will required no witnesses, being entirely in the hand of the testator and signed sous seing privé. The Court considered various precedents and favoured the opinion of Pothier who states:- "La form de l’olographe consiste en ce qu’il doit être écrit en entier et signé de la main du testateur …. La signature doit être à la fin de l’acte dont elle est le complément: c’est pourquoi un postscriptum après la signature est nul, s’il n’est aussi signé". The Court was mindful that when construing a testamentary disposition it is the duty of the Court, so far as is possible, to give effect to the wishes of the testator. It was clear from her unequivocal words that the deceased had not intended to die intestate. Held, the Court had no doubt that the deceased intended to make a valid will and ordered that the holograph will be admitted to Probate, that the Greffier draw a line through the otiose attestation clause which appeared after the signature of the deceased, and that two affidavits of handwriting be provided in the usual way and the costs of the proceedings be met out of public funds. |