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
BANKRUPTCY
Assistance to
foreign court—disclosure—purpose for which information can be used
Ariel v Halabi
[2018] JRC 006A (Royal Ct: Birt, Commr and Jurats Crill and Ramsden)
WAF Redgrave for the representor; J Harvey-Hills for
the first respondent; DP Le Maistre for the second respondent
An English trustee in bankruptcy obtained a recognition
order in Jersey pursuant to a letter of request from the English High Court and
to the court’s powers of assistance to foreign insolvency courts under art
49 of the Bankruptcy (Désastre) (Jersey) Law 1990. The recognition order
stated that—
“Save with the leave of this Court, the Representor
shall only use the information or documents so produced for the purposes of the
administration of the estate in bankruptcy of Mr Halabi, in whichever
jurisdiction, under the direction of the High Court.”
Pursuant to a consent order, the trustee in bankruptcy
had also been joined to proceedings under art 51 of the Trusts (Jersey) Law
1984 brought by the trustees of a Jersey trust. The consent order required the
trustees of the trust to provide to the trustee in bankruptcy certain documents
used in connection with the proceedings but such provision was subject to the
following restriction—
“Provided always that such disclosure shall not be
used for any purpose other than the Representation and shall not be disclosed
to any third parties, other than to the parties’ legal advisers, and in
particular shall not be disclosed to any of the Defendants in the Actions
described in paragraph 4 below.”
The
trustee in bankruptcy was later made the subject of an information notice
issued by HMRC, and approved by First-Tier Tribunal (Tax Chamber), which
required him to produce to HMRC all documents and information which he had
received pursuant to the Jersey recognition and consent orders. The trustee in
bankruptcy, being concerned that compliance would render him in breach of the
restrictions in the recognition and compliance orders, sought the court’s
leave under the recognition order to comply with the information notice and
seeking a variation of the consent order to like effect if the court considered
that he would otherwise be in breach of either order.
Held:
Jurisdiction to give leave
under the recognition order. Although the court could only make an order
under art 49 in order to provide assistance to the courts of another country
relating to the insolvency of a person, it did not follow that the court could
not do by variation what it could not have done originally. The court had
clearly envisaged that, with the leave of the court, the material obtained
pursuant to the recognition order could be used for a purpose other than the
administration of the bankruptcy in question. The fact that this might become
necessary and that information might have to be used for some other purpose did
not change the fact that the order was made for the purposes of assisting in a
bankruptcy. Furthermore, the wording of art 49 was not so restrictive as to
deny the court the ability to allow material originally obtained for the
purpose of insolvency to be used for some other purpose if that became
necessary. An example was Re AG
(Manchester) Ltd (in liquidation).
Jurisdiction to vary the consent order.
The consent order was not made under art 49. However it was by its nature not a
final order. It sought to control onward disclosure of material supplied to a
party in art 51 proceedings. The court was ultimately the arbiter of whether
material supplied in proceedings may be disclosed elsewhere and always has an
ongoing ability to vary an order which it has made about the confidentiality of
material produced in proceedings before it, whether held in public or in
private. Furthermore, the court specifically gave liberty to apply in
connection with the consent order. Accordingly the court had jurisdiction to
vary the consent order in the light of changed circumstances.
Rule against assistance for enforcement of
foreign tax. Rule 3 of Dicey Morris and Collins, The Conflict of Laws (15th edn), at 5R-019 states—
“English courts have no jurisdiction to entertain
an action . . . for the enforcement, either directly or indirectly,
of a penal, revenue or other public law of a foreign state.”
The rule accurately reflects the position under Jersey
law. The question was whether the orders requested by the trustee in bankruptcy
would amount to indirect enforcement of a foreign (in this case UK) revenue
law. The decision of Royal Court in Re
Tucker was reached some 30 years before,
and before the decision of the House of Lords in Re State of Norway (Nos 1 & 2) The House of Lords held
that granting assistance in the form of the examination of a witness in
connection with a Norwegian tax assessment did not amount to the indirect
enforcement of the revenue laws of the State of Norway. The provisions of the
Finance Act 2008, Schedule 36, under which the information notice had been
issued, were investigatory powers that enabled HMRC to gather information for
the purpose of checking a taxpayer’s tax position (R (Jimenez) v First Tier Tribunal (Tax Chamber), distinguished).
Accordingly, a variation by the court which recognises the fact that the
trustee was on the horns of a dilemma and therefore permitted the trustee to
supply material to HMRC for the purposes of their tax investigation, did not
amount to indirect enforcement of a foreign tax law.
Discretion. Consistent with its general
approach of seeking to ensure that Jersey is a responsible member of the
international community, the States had passed legislation which enabled
confidential information in Jersey to be obtained both to assist in overseas
insolvencies and for the purpose of preventing tax evasion in other
jurisdictions. However, the States has provided two very different routes. For
insolvency matters, art 49 of the Bankruptcy Law was the relevant route. For
tax matters, a completely different route had been established by the
legislature under Tax Information Exchange Agreements and the Taxation
(Exchange of Information with Third Countries) (Jersey) Regulations 2008. Where
two distinct routes have been established by the legislature, it would, as a
matter of general principle, be wrong for the court to mix them up.
However,
on occasions, persons in receipt of material subject to a restriction as to its
use may find themselves the subject of obligatory measures requiring its
disclosure. In Bank of Crete SA v
Koskotas (No 2), a case regarding third
party disclosure in litigation, Millett, J held that, while it would not
normally be right to authorise the plaintiff voluntarily to make use of the
material disclosed for any other purpose, the court, in the exercise of its
discretion, ought not to place the plaintiff in the position of having either
to infringe its undertakings to the court or to find itself in breach of its
duties under foreign law. In the present case, the terms of the relevant TIEA
did not permit material prior to 2010 to be obtained. HMRC required information
going back to the early 1990s. The court had to determine whether to consent to
the trustee in bankruptcy complying with the information notice in
circumstances where, if it were to refuse and the trustee were subsequently to
refuse to comply, either he would be penalised, (possibly on a daily basis) or
HMRC would be denied access to material situated within the UK to which it was
entitled under English law, where an independent judicial monitor had found its
request for the information to be reasonable and where there is no alternative
route available under the TIEA. In these particular circumstances, bearing in
mind the considerations mentioned by Millett, J in the Bank of Crete case, the court concluded that the right course was
to grant consent under the recognition order and also to vary the consent order
so as to permit the trustee in bankruptcy to comply with the information
notice.
CIVIL PROCEDURE
Disclosure—Norwich Pharmacal order
Riba
Consultaria Empresarial Ltd v Pinnacle Trustees Ltd [2018]
JRC 33A (Royal Ct: Birt, Commr and
Jurats Nicolle and Crill)
JN Heywood for the plaintiff; EB Drummond for the defendant
The question was raised as to the required standard of
proof in determining, for the purposes of a Norwich
Pharmacal application, whether a third party has become mixed up in
wrongdoing.
Held: The test as to whether a third
party, from whom information is sought under a Norwich Pharmacal order, has become mixed up in alleged wrongdoing
is whether there is a reasonable suspicion that that third party is in that
situation: Macdoel Invs Ltd v Brazil (Federal
Republic),[6]
a decision of the Jersey Court of Appeal.
A
“reasonable suspicion” is lower than “prima facie evidence” but a “good arguable case”
is higher than “prima facie
evidence”. With this in mind the court preferred to reformulate the
second test as set out in the later decision of the Royal Court in New Media Holding Co LLC v Capita Fiduciary
Group Ltd[7]
so that it refers to “reasonable suspicion” and therefore reads as
follows—
“(i) Are we satisfied there is a good arguable case
that the plaintiff is the victim of wrongdoing? (ii) Are we satisfied that
there is a reasonable suspicion that the defendant has been mixed up in the
wrongdoing? (iii) As a matter of discretion, do we consider it to be in the
interests of justice to order the defendant to make disclosure?”
Applying those tests on the facts, the court granted
the relief sought.
COMPANIES
Winding
up—failure to provide accounts to company member
In re Canargo Ltd
Guernsey Judgment 13/2018 (Royal Ct: Collas, Bailiff and Jurats Jones,
Ferbrache and Robilliard)
MC Newman for the applicant
An application (the first of its kind) came before the
Royal Court to place a company into liquidation for having failed to provide
company accounts to a member. The application was effectively a member versus
member dispute. The applicant, Canargo Cayman Ltd, a Guernsey registered
company, owned 25% of the issued share capital of Canargo Ltd (“the company”).
The company’s primary business was as a participant in a joint venture
agreement concerning oil and gas exploration in Georgia. The company was
beneficially owned by Mr Isaak, who was a director until he was removed against
his will at an extraordinary general meeting on 18 November 2016. Mr Ramsay,
the sole director of the company, owned the other 75% of the share capital. The
application before the court was part of an ongoing dispute between Mr Ramsay
and Mr Isaak. Mr Ramsay had failed to comply with an order, made at an initial
hearing, granting him an adjournment to file and serve evidence in response to
the application. He had since also failed to provide his advocate with
instructions. Accordingly, there was no evidence before the court from Mr
Ramsay and he was not represented. The applicant alleged failure of the
obligation in s 251(1) of the Companies (Guernsey) Law, 2008 as amended (“the
Companies Law”), which imposed a mandatory obligation to send accounts to
members within 12 months of the end of the financial year. There was also an
alleged breach of the duty in s 251(2) of the Companies Law, namely, to
send the most recent accounts to a member within seven days of a request to do
so unless that member had made a similar request within the financial year.
Affidavit evidence of non-compliance stated that the company had failed to send
the applicant a copy of the accounts for the period ended 31 December 2015 and
that letters to Mr Ramsay containing requests for financial information
regarding the company had gone unanswered. Mr Ramsay’s former advocate
had accepted, in a letter to the applicant’s counsel, that the accounts
were not produced; the Bailiff remarked that if there were good and valid
reasons for the failure to supply the accounts, set out in the letter or
otherwise, the court would have taken those reasons into account in the
exercise of its discretion. However, no such evidence was before the court. The
Bailiff directed the Jurats that they had wide discretionary powers, both under
s 251(6) and under s 406 where the expression is that the court “may”
order a winding up.
Held: The application for
the company to be wound up would be granted. Where there has been a failure to
provide a member with company accounts, the court will first consider whether
to order that the accounts be sent within a reasonable period of time as
envisaged in s 252(6)(b). The decisive facts considered by the Jurats in
the present case were that the request had been outstanding for some time; the
proceedings had been issued more than two months prior to the hearing; the company
had had the opportunity to comply with its statutory obligations and had failed
to do so notwithstanding that Mr Ramsay’s former advocate said, at the
first hearing, that the court would be made aware of all the relevant factors;
and there was no evidence before the court to explain the company’s
failures. The Jurats had no reason to believe that accounts would be produced
or that anything would be achieved if they were to allow the company a further
period within which to comply by issuing a direction in that regard under s 251(6).
They recognised that the liquidators would have difficulties in discharging
their duties in the absence of any accounts. However that could not prevent the
court granting the application to wind up the company.
COMPETITION LAW
Abuse of
dominant position—appeals
ATF Overseas Holdings
Ltd v Jersey Competition Regulatory Authority [2018] JRC 004 (Royal Ct: Sir
William Bailhache, Bailiff and Jurats Crill and Ramsden)
JD Kelleher for the appellant; NM Sanders for the respondent
The appellant appealed against the decision of the Jersey
Competition and Regulatory Authority (“JCRA”) that it, having taken
over a business of fuel supply at Jersey Airport, had abused a dominant
position in the supply of aviation fuel contrary to the Competition (Jersey)
Law 2005 (“the Law”) by (i) refusing to supply aviation fuel to
Aviation Beauport Ltd (“ABP”) for the purposes of re-sale by ABP at
Jersey Airport; and (ii) charging prices to ABP that were higher than those
paid by customers purchasing similar volumes and were therefore discriminatory.
Article 53 of the Law provides for the appeal to the Royal Court and is in the
form of a “may appeal”
provision without specifying the nature or grounds of appeal.
Held, allowing the appeal:
Nature of appeal under the Competition
(Jersey) Law 2005. A full discussion of the nature of an appeal against a
decision of the JCRA was to be found in JT
(Jersey) v JCRA.
That case considered the right of appeal contained in art 12 of the Telecommunications
(Jersey) Law 2002, but the conclusions of the court in that case could be read
across to an appeal under art 53 of the Law, that article being drawn in very
substantially similar terms.
The
court (i) will consider whether the decision was one which the JCRA was
empowered to make, i.e. was the decision ultra
vires? (ii) will look at the correctness and fairness of the procedure in
order to decide whether the proceedings of the JCRA were in general sufficient
and satisfactory; and (iii) will look at the merits of the decision (as well of
course as considering matters such as whether the JCRA took into account any
irrelevant factors or failed to have regard to relevant factors) and decide
whether the appellant has satisfied it that the decision was wrong. In reaching
its conclusion, it will give due weight to the decision of the JCRA bearing in
mind its expertise and experience.
Where
an appeal is allowed because of procedural errors or unfairness of sufficient
gravity, the likely remedy will be that the decision is quashed and the matter
remitted to the JCRA for reconsideration. Where, on the other hand, the appeal
is allowed because the court considers the decision to be wrong, it will make
such order as it thinks fit. This may be to remit the matter to the JCRA for a
new decision to be taken or it may be that the court will, in accordance with art
12(5)(c) make a decision itself as to the exercise of the specified regulatory
function.
This
approach was very similar to the approach which is described in British Sky Broadcasting Ltd v Office
of Communications.
Decision. Article 16(2) of the Law
provides examples of what might constitute abuse of a dominant position but it
is a matter of judgment for the JCRA or, on appeal, the court to determine
whether there has been an abuse. Article 16 is very similar to art 102 of the
Treaty on the Functioning of the European Union and the court accordingly
considered case law relating to that treaty. The distinction between conduct on
the part of a dominant firm which is permissible and conduct which is
prohibited as abusive is often a difficult one, and the assessment of the
actions of the dominant firm in any particular case will be a question of fact
and degree. Richards LJ noted in National Grid plc v Gas & Electricity
Markets Authority
that the text set out a number of considerations including—
“(v) how far the conduct in question is normal
industry practice or, on the contrary, is exceptional and plainly restrictive
of competition . . . (ix) whether the adverse impact of the conduct
is ‘proportionate’ to any legitimate commercial interest or public
policy objective which may be identified as an ‘objective justification’
for such conduct.”
It is a strong thing to require that entity to share
facilities which it has created with a trade competitor: Oscar Bronner GmbH v
Mediaprint Zeitungs-und Zeitschfriftenvelag GmbH.
On the particular facts, the court was satisfied that the appellant had not
abused its dominant position by refusing to sell aviation fuel to ABP for
onward re-sale. Although the effect was to reduce competition, this did not
necessarily mean that ATF had abused its dominant position and on the
particular facts its conduct has not been unfair. ATF had assumed a risk in
making substantial investments in the business. There was in fact no price
penalty to APB’s customers; ATF was entitled so to arrange its business
in a way that kept its own risks under its own control; and to require ATF to
operate in the same way as its predecessors in business would be
anti-competitive. Furthermore, behaviour that would normally be regarded as
abusive is permissible if a business can demonstrate an objective justification
for it. In this case, the court also accepted the appellant’s contention
that it was objectively justified in refusing to supply ABP because that company
had no permit or licence from Ports of Jersey Ltd to act as a re-seller of the
fuel at wing-tip. Accordingly, even if the refusal to supply aviation fuel to
ABP fell to be treated as an abuse of the dominant position on other grounds,
there would be an objective justification for it as ABP had no licence to act
as re-seller. On the facts there had also been no unlawful price discrimination
against APB.
CONFLICT OF LAWS
Trusts—proper
law of trust—application of Sharia law
Dubai Islamic
Bank PJSC v Ridley [2017] JRC 204 (Royal Ct: Le Cocq, DB, sitting alone)
JC Turnbull for the defendant/appellant; DR Wilson for
the plaintiff/respondent.
The defendant/appellant appealed against a decision of
the Master striking out parts his answer. By its Order of Justice, the plaintiff/respondent
(the bank) claimed assets worth approximately US$7m which, it alleged, had been
contributed to a Jersey trust known by the defendant and represented monies
obtained by him as a result of a fraud on the bank. The claim was proprietary,
the bank claiming that it could trace monies into the trust. The alleged fraud
was perpetrated according to the bank through certain agreements (the agency agreements)
which were expressed to be governed by English law (or in one case German law)
in so far as not inconsistent with Sharia law. In his answer, the defendant
claimed that in any event he had defences available to him under Sharia law
because the bank’s claim had in effect been discharged when the bank took
possession of certain property used as security. In striking out parts of the answer,
the Master held inter alia that the appropriate conflict of law rules
for determining the proper law of the agency agreements and the proprietary
claims arising out of them were those of England and Germany.
Held, as regards the conflicts of law
issues:
Principles on strikeout. The court
should only strike out pleadings in plain and obvious cases: In re Esteem
Settlement. In that case the court
also recognised that such a cautious approach to striking out is even more
applicable in “an uncertain and
developing field of law”.
Application of conflicts of law of lex fori. It had been common ground
between the parties before the Master that that it was a “a rule of general application which is
universally admitted” (see Dicey, Morris and Collins, Conflicts
of Law, 15th edn) that it
is the private international law rules of the lex fori which must be
applied in determining proper law, whether or not the question is identified as
being one of the proper law of the agency agreements as contracts or the proper
law of restitutionary and/or proprietary claims arising from the agency agreements.
The Master, however, applied English conflict of law rules to these questions (and
took German law to be the same as English law) on the basis that the above
principle derived from cases relating to ascertaining the law of a contract
whereas the question in the present case was the law which underpinned the plaintiff’s
claim to require the defendant to account for property. Applying English
conflicts rules, the Master held that English law recognised that the bank had
the right to trace and ignored Sharia law.
Disagreeing
with that approach, the Deputy Bailiff said that application of English conflict
rules was not obviously the case. Conflict of law questions, including the
proper law, are in essence procedural matters and it was at least arguable that
the applicable law remedy is the private international law of Jersey as the lex
fori. Furthermore, a determination of Jersey private international law on
this issue was not a matter for a strikeout application. Unless it was clear
that the court should not apply the private international law of Jersey to the
issue, then insofar as it related to the Master’s orders for striking out
issues of Sharia law, that part of the appeal should be allowed. It was more
than simply arguable that all matters of remedy, including the bank’s
claims for relief in the present proceedings, are matters for the lex fori,
namely Jersey law, and it may be necessary for a determination to be made at
trial as to the effect of the Sharia law qualifications in the agency agreements.
Incorporation of Sharia law. The Master
also went on to consider the question as to whether the references in the agency
agreement to the principles of Sharia law were sufficient to incorporate Sharia
law into the contract. He rejected that argument, relying substantially on the
judgment of the English Court of Appeal in Beximco
Pharmaceuticals Ltd v Shamil Bank of Bahrain EC. In the subsequent case of Halpern v Halpern,
the judgment of Potter LJ in Beximco
was clarified by Waller LJ in which he said that an “English law, subject
to Sharia law” clause could not be interpreted so as to potentially
defeat the commercial aim of the contract and did not incorporate sufficiently
certain black-letter provisions. However, without in any way deciding this
point definitively, it was possible to argue that the Sharia law provisions did
not in this particular case defeat the commercial purposes of the contract. Indeed,
in one sense, it is one of the bases of the agency agreements. It was arguable
that they went to the fundamental nature of the agreements themselves although
that was an argument to be resolved if necessary at trial. Nor was it clear
that Sharia law was incapable on the relevant points of being expressed with
sufficient certainty or clarity as to what that law might provide. It was therefore
not possible to conclude with certainty that Sharia law could not be
incorporated by reference into the agency agreements so as to justify striking out
any pleading to that effect. It may be that Sharia law was not certain enough
but there would need to be evidence about it before the court to reach that
conclusion. There was no sufficient evidence before the Master or indeed before
the court relating to the certainty, clarity or ambit of Sharia law in this
context. Accordingly, it was not possible to determine at this stage, and
without further information, whether Sharia law was capable of incorporation.
COURTS
Judicial
Committee of Privy Council—leave to appeal
Seneschal’s
Court—jurisdiction
A v R [2018] UKPC 4 (Lady Hale, Lord Mance, Lord Wilson, Lord Hodge and
Lady Black)
V Wakefield for the appellant; C Gallagher QC for the respondent
The parties, both German nationals, were the parents of
a minor child, “C”. They had never been married to one another.
They lived together in Sark at the time of C’s birth in 2009. In February
2012, the respondent (C’s mother) and C moved away from Sark. In May
2012, the relationship between the parties broke down. They were unable to
reach an agreement as to joint care, custody and maintenance of C. In January
2013, the respondent returned to Sark with C and issued an application against
the appellant (C’s father) in the Seneschal’s Court for a
maintenance order and a sole care and control order in respect of C. The
Seneschal’s Court made an interim award against the appellant to pay
maintenance for C to the respondent. Orders for payment of arrears of
maintenance and a maintenance order were subsequently made by the Court on 9
February, 5 March and 9 July 2015. The appellant appealed those orders to the
Royal Court of Guernsey and the Guernsey Court of Appeal. The Court of Appeal
refused him leave to appeal to the Judicial Committee of Privy Council on 13
July 2017. He then sought special leave to appeal from the Board. The
application raised an important question as to the circumstances in which an
applicant needed permission to appeal to the Board from a judgment of the
Guernsey Court of Appeal. It also raised questions about (a) the extent of the
jurisdiction of the Seneschal of Sark; and (b) the scope for judicial development
of the common law or customary law in Sark.
Held: Special leave to
appeal the issue of applicable law would be refused. Alternatively, the appellant
would be granted special leave to appeal and there would be a recommendation to
Her Majesty in Council that the appeal be dismissed. Section 16 of the Court of
Appeal (Guernsey) Law 1961 excluded the need for special leave of Her Majesty
in Council or leave of the Court of Appeal when the monetary value of the claim
was or exceeded £500. The Guernsey Court of Appeal had sought to reform
this outdated provision by refusing to grant permission unless the appeal
raised an arguable point of law of general public importance. However, s 16
of the 1961 Law provided for an appeal as of right when the monetary value of
the claim was or exceeded £500. It was beyond the power of the courts to
contradict that legislation. The appellant’s appeal as of right did not
mean that the Court of Appeal had no control over the appeal. The Court of
Appeal indeed had the power to refuse an appeal where the applicant had an
appeal as of right but the appeal was an abuse of process. Moreover, the Board
had a limited discretion to refuse special leave in a case where there was an
appeal as of right if that appeal were devoid of merit and had no prospect of
success and/or if the appeal was an abuse of process. An Order in Council dated
24 April 1583 gave the jurats of Sark jurisdiction over all civil causes
(excluding ecclesiastical causes). In 1676, the Seneschal’s Court
inherited the jurisdiction of the former judges and jurats. The modern
statement of the jurisdiction of the Seneschal of Sark came from a 1922 Order
in Council and an ordinance of the Royal Court of Guernsey dated 5 October
1931. Later, the Reform (Sark) Law 1951 and the Reform (Sark) Law 2008
preserved the pre-existing jurisdiction of the court and stated that it shall
be the sole court of justice in Sark. The court had the right to hear and
adjudicate every action, whether in movables or in immovables. However, legislation
may give exclusive jurisdiction over a specified matter to the Royal Court of
Guernsey. The Seneschal’s Court
had unlimited jurisdiction in civil matters. Its jurisdiction was not limited,
as suggested by the appellant, to ordering the payment of liquidated sums due
as debts and making orders in relation to immovable property.
Each
of the Channel Islands had two principal sources of domestic law: legislation
and customary law (sometimes described as common law). The Channel Islands
gained their customary laws initially from the unwritten customs of the Duchy
of Normandy. Local customs also developed within the Islands. On 27 July 1579,
a Royal Commission was appointed to ascertain the extent to which the laws and
customs of Normandy applied in Guernsey. A statement of the law of the
Bailiwick of Guernsey known as “L’Approbation”
was ratified by an Order in Council on 27 October 1583. However, L’Approbation was not a complete
statement of the customary laws of the Bailiwick, which continued to develop. L’Approbation had not prevented
the judicial development of the common law of Guernsey. While the status of L’Approbation as legislation
prevented direct abrogation of its provisions by judicial decision, the scope
for judicial development of the law around and in addition to its provisions
should not suffer the constraints which more modern statutory provisions would
impose. There was no reason to believe that L’Approbation
was intended to prevent the further development of the common law of Guernsey.
The position is no different in Sark. The Order in Council of 24 April 1583
re-established the laws of Guernsey as Sark’s customary law. L’Approbation stated that a father
had a duty to maintain his children until they were married or had reached the
age of 20 years. The Children (Sark) Law 2016 created, for the first time, a
statutory regime for parental responsibility. The Affiliation Proceedings (Sark)
Law 2017 created a statutory right of an unmarried woman to obtain a court
order against the putative father to pay towards the maintenance of his child.
However, the absence of a statutory regime in this area did not mean that the
common law had not developed since 1583, nor did it mean that L’Approbation encompassed the
whole law on the maintenance of children.
The Court of Appeal was correct to hold that there has long existed an
action in maintenance at common law in Sark. The Board was satisfied that Sark
had an action for enforcement of the obligation to maintain a child, which the
parent caring for the child could raise when the child was not of an age at
which he or she could assert the right to maintenance himself or herself. The
Board dismissed the appellant’s argument that (i) it had no power to make
an interim order, and (ii) the enforcement of a maintenance obligation did not
comply with article 1 of Protocol 1 to the European Convention on Human Rights.
The common law of Sark empowered the Seneschal’s Court to make the orders
challenged. The appellant’s ground of appeal relating to the applicable
law had not been raised in either party’s pleadings. Nor had it been
adjudicated upon by the fact-finding court. In the circumstances, an appeal on
this ground was an abuse of process.
CRIMINAL
LAW
Rape—evidence—credibility
W v Att Gen
[2017] JCA 196 (CA: Pleming, Perry and Doyle JJA)
CMM Yates, Crown Advocate; MJ Haines for the appellant
The appellant appealed against conviction in relation
to 11 offences of a sexual nature, committed over a period of six years between
1997 and 2003 against two complainants who, at the time of the offending, were
young girls. The essential issue on appeal was whether the appellant was
wrongly denied the opportunity to cross-examine a complainant in relation to an
allegation of rape she had made against another man, F, in August 2009. The
appellant contended that the allegation of rape made against F was concocted,
and that permitting cross-examination would or might have had a bearing on the
complainant’s credibility as a witness. On this basis, the appellant
submitted that his inability to cross-examine rendered the trial unfair and,
accordingly, his conviction was unsafe.
Held: In Jersey, the
position in relation to other sexual behaviour was governed by customary law.
The Court of Appeal adopted the approach which had also been followed by the
Royal Court, namely that explained by Sir Michael Birt, Commr in Att Gen v Correia:[15] the
general rule is that evidence that a complainant engaged in consensual sexual
conduct with other persons is not admissible to support the inference that a
person who has previously engaged in consensual sexual conduct is for that
reason less worthy of belief as a witness. Such evidence is similarly not
admissible to support the inference that a person who has previously engaged in
consensual sexual conduct with other persons is for that reason alone more
likely to have consented to the sexual conduct at issue in the trial. This is
to counter the “twin myths” that unchaste women are more likely to
consent to intercourse and in any event are less worthy of belief: see R v A (No 2).[16] The
general rule also recognises that to allow victims of sexual abuse to be
harassed unfairly by questions about their previous sexual experience is unjust
to them and may distort the course of the trial by distracting attention from
the real issues which have to be determined.
An
obvious exception to the general rule is evidence or questioning about a
complainant’s previous false complaints of sexual assault. The twin myths
are not engaged, and the issue becomes one relating to the credibility of the
complainant. The case law makes it clear that there must be a proper evidential
basis for asserting the previous complaint to be untrue. The stronger
requirements in the English case of R v
RD[17]
were to be preferred to those in R v AM.[18] The
allegations of previous false complaints should be rigorously scrutinised.
There must be material that is at the very least capable of founding an
inference that the previous complaint is false without the need for the issue
of falsity to be explored in cross-examination. In the absence of such
material, a suggestion that the complaint is false is merely a matter of
speculation. The test is only likely to be satisfied where there is evidence of
an admission by the complainant that the earlier allegation was false, or where
the complaint is, on its face, demonstrably untrue and not simply implausible.
Courts should also be ready to deploy a degree of understanding of the position
of those who have made sexual allegations: R
v Hilly.[19]
The
Deputy Bailiff[20] had
properly come to the conclusion that there was no “sufficient”
evidential basis to conclude that the allegation of rape made against F by the
complainant was false and, accordingly, he declined to permit questioning in
relation to it. The appeal was accordingly dismissed.
TRUSTS
Breach
of trust—remedies
Liability
of trustees—relief of liability
Crociani v
Crociani [2018] JRC 013 (Royal Ct: Clyde-Smith, Commr, sitting
alone.
AD Robinson for the plaintiffs; WAF Redgrave for the
third and seventh defendants; E Moran for the fourth defendant
On a costs application, the question arose as to
whether a trustee found to have been in breach of trust is subject to ordinary
costs principles or must, given the trustee’s obligation to restore the
trust fund, always pay costs on an indemnity basis or alternatively that such
restoration/compensation should extend to the irrecoverable legal costs
incurred by the trust fund in successfully pursuing the defaulting trustee. The
trustees had accepted liability for costs by consent. Their respective conduct
in the litigation differed for the reasons below.
Held, as
regards costs against the third and fourth defendants (the trustee defendants):
Costs
payable by trustee in breach of trust vis-à-vis trust fund. As stated in Target Holdings v Redfern[21] where there has been a breach of trust,
the obligation of the defaulting trustee is to restore to the trust fund what
has been lost by reason of the breach or to make compensation for such loss,
sufficient to put the trust fund back to what it would have been had the breach
of trust not been committed. As regards litigation costs, the question arises
as to whether a defaulting trustee must always pay costs on the indemnity basis
or alternatively that such restoration/compensation should extend to the
irrecoverable legal costs incurred by the trust fund in successfully pursuing
the defaulting trustee.
Ordinary
rules as to costs apply.
Under English law, costs are dealt with separately from
restoration/compensation applying the ordinary rules: Lewin on Trusts, 18th edn, at para 27–173—
“The ordinary rules as to costs of hostile
litigation apply to breach of trust actions. Accordingly, the general rule is
that the unsuccessful party will be ordered to pay the costs of the successful party,
subject to the general qualifications which apply in ordinary hostile
litigation.”
At fn 429 the editors note that—
“in Jersey costs are normally awarded against a
defaulting trustee on the indemnity not the standard basis: Ogier Trustee (Jersey) Ltd v C.I. Law
Trustees Ltd [2006] JRC 158 at [20]; and see Re The Den Haag Trust (1997–98) 1 O.F.L.R. 495, Jers RC; Bhander v Barclays Bank & Trust Co. Ltd
(1997–98) 1 O.F.L.R. 497, Jers RC.”
However, these cases cited did not establish a general
rule to this effect and the principle did not extend to cases where there is a
defence to the allegations of breach of trust. Where there is a defence, the
trustee is perfectly entitled to defend the proceedings and to do so robustly.
Irrecoverable
costs as a result of the ordinary rules. As to whether the court should nevertheless take into
account the fact that the trust fund will bear an unrecoverable portion of the
costs, the court noted that, in relation to indemnity costs, it is principally
concerned with the losing party’s conduct of the case, rather than the
substantive merits of the position. It was important for the court to be able
to exercise discipline over the conduct of the parties in proceedings by the
imposition of indemnity costs where it is appropriate to do so, which would be
undermined by the court invariably awarding indemnity costs against a
defaulting trustee.
Disposal. In
the present case the ordinary rules as to costs in hostile litigation were
applied. Taking an overview of the litigation (Egglishaw v Watkins[22]) the court concluded that the third
defendant’s conduct of the proceedings came within the bounds of what is
acceptable in hard fought litigation, not justifying an award of indemnity
costs. However the position of the fourth defendant was different. On the
facts, its conduct in the proceedings went way beyond what was reasonable or
the norm and could only be met with an order for indemnity costs.