Cable & Wireless Jamaica Ltd v Eric Jason Abrahams

• Jurisdiction: Jamaica
• Court: Court of Appeal (Jamaica)
• Judge: Fraser JA (AG),F Williams JA,McDonald-Bishop JA
• Judgment Date: 09 July 2021
• Neutral Citation: [2021] JMCA App 19
• Year: 2021
• Docket Number: SUPREME COURT CIVIL APPEAL NO 97/2018

Between

Cable & Wireless Jamaica Limited

Applicant

and

Eric Jason Abrahams

Respondent

BEFORE:

THE HON Mrs Justice McDonald-Bishop JA

THE HON Mr Justice F Williams JA

THE HON Mr Justice Fraser JA (AG)

SUPREME COURT CIVIL APPEAL NO 97/2018

APPLICATION NOS 258 & 283/2018

IN THE COURT OF APPEAL

Mrs Denise Kitson QC, Kevin Williams and Miss Anna-Kay Brown instructed by Grant Stewart Phillips & Co for the applicant

Conrad George and Andre Sheckleford instructed by Hart Muirhead Fatta for the respondent

McDonald-Bishop JA

1 These proceedings concern two applications brought by Cable and Wireless Jamaica Limited (‘CWJ’) for this court to vary or discharge the order of a single judge of this court (‘the single judge’), made in chambers on 13 December 2018, and for stay of proceedings in the Commercial Division of the Supreme Court, pending appeal. The single judge had before him, for his consideration, an application for stay of proceedings pending appeal, which was brought by CWJ from the decision of Batts J, made in the Commercial Division of the Supreme Court on 3 October 2018.

2 The single judge declined to consider the application for stay on the basis that he did not have the jurisdiction to do so and awarded costs in favour of the respondent, Mr Eric Jason Abrahams (‘Mr Abrahams’), to be agreed or taxed.

3 Upon the refusal of the single judge to consider CWJ's application for stay of the proceedings in the court below, CWJ made an application for the court to discharge and/or vary that order of the single judge and for, among other consequential orders, a stay of the proceedings in the Supreme Court before Batts J, pending the determination of the appeal.

4 Three distinct, but related issues arose for the court's consideration on the notice of application. They were as follows:

(1) whether the single judge erred in declining jurisdiction on the basis that a single judge cannot grant a stay of proceedings;

(2) whether the single judge erred in making the adverse costs order against CWJ; and

(3) whether the circumstances of the case favoured a stay of proceedings in the court below, pending appeal.

5 On 8 February 2019, after hearing submissions from counsel for the parties, the court decided all three issues in favour of CWJ and granted the orders sought by CWJ in terms of the notice of application. Accordingly, the court discharged the order of the single judge, granted the stay of proceedings in the Supreme Court until the determination of the appeal, and ordered that the costs of the application shall be costs in the appeal.

6 The court also made some necessary case management orders in preparation for the expeditious hearing of the appeal. We promised then to put the reasons for the decision in writing. With sincerest apologies for the delay, we now fulfil that promise.

7 At this juncture, it is important to note that by virtue of amendments made to the Court of Appeal Rules (‘the CAR’) in September 2015, rule 2.8, as it existed at the time, was deleted because of its inconsistency with sections 256 and 258 of the Judicature (Parish Court) Act. Accordingly, the numbering of the subsequent rules under section 2 of the CAR was also affected so that rules 2.9 through to 2.20 were amended to become rules 2.8 through to 2.19, respectively. We highlight this because the parties, in their submissions in this court, and the single judge, in considering the matter based on the grounds of the application and the submissions that were before him, made reference to the rules as they would have been prior to the 2015 amendments. The reliance on the pre-2015 amended CAR would have been erroneous because the application under consideration was filed in 2018. Therefore, it is considered proper to correct the error in this judgment by referencing the relevant rules that would have been applicable at the time the application was filed and considered by the single judge. Those are the relevant rules of the CAR as they stood following the 2015 amendment.

Background

Proceedings in the Supreme Court

8 Mr Abrahams, at all material times, was a minority shareholder in CWJ. On 29 November 2017, he filed an application (relisted) in the Supreme Court, seeking permission to bring derivative proceedings in the State of Florida in the United States of America for, and on behalf of, CWJ (‘the proposed derivative action’). He was desirous of instituting the proposed derivative action against CWJ's parent company, Cable & Wireless Plc, and against some “past, present and shadow directors” of CWJ, who he said had caused CWJ to suffer loss and damage during the period 2010–2017. The allegation grounding this proposed derivative action was that the directors and shadow directors had breached their fiduciary duties to CWJ.

9 Mr Abrahams averred that the court in Florida is the convenient forum to hear the proposed derivative action because Cable & Wireless Plc has its operational headquarters in Miami, Florida, he is domiciled in Florida, and two shadow directors are also in that state.

10 When Mr Abrahams' application came up for hearing before Batts J, CWJ opposed the application on the basis of two preliminary objections. The first objection was that the application for leave to bring the derivative action ought to have been commenced by a fixed date claim form, instead of a notice of application; and the second, that the Supreme Court had no jurisdiction to issue an order for a derivative action to be commenced outside the jurisdiction.

11 Batts J did not uphold the preliminary objections. In disposing of the first objection, he opined that in the absence of an express provision in the Companies Act, and the Civil Procedure Rules, 2002 (‘CPR’), as to the mode or method of application, the matter should continue as if it was commenced by way of a fixed date claim form. With regard to the second objection, Batts J, relying on sections 212(1)-(2) and 213 of the Companies Act, held that the “court has jurisdiction to give permission to bring a derivative action in the name of and on behalf of the company in a jurisdiction other than Jamaica” (see para. [15] of the judgment Eric Jason Abrahams v Cable & Wireless Jamaica Limited [2018] JMSC Comm 29). He reasoned that he was persuaded by, and accepted, the purposive approach to statutory interpretation adopted by the courts, which considered similar legislation, in the British Virgin Islands. He concluded that there was no inconsistency between the Judicature (Supreme Court) Act and the grant of permission to bring or defend an action in a foreign jurisdiction and that there is nothing to compel a construction that section 212 of the Companies Act is limited to claims in Jamaica.

12 Based on that reasoning, Batts J made the following orders:

• “1. Preliminary point as to jurisdiction dismissed.

• 2. Costs to [Mr Abrahams] to be agreed or taxed.

• 3. Leave to Appeal is granted.

• 4. The relisted Notice of Application for Court Orders filed on the 29 ^th November 2017 is adjourned to the 18 ^th and 19 ^th December 2018, commencing at 11 am.”

CWJ's appeal and application for stay of proceedings before the single judge

13 On 16 October 2018, CWJ filed an appeal from the decision of Batts J dismissing the preliminary objection as to jurisdiction with costs to the respondent. There was no appeal against the dismissal of the preliminary objection regarding the process that had commenced the proceedings. CWJ also filed the application in this court seeking a stay of the proceedings in the court below, pending the determination of the appeal. In making the application for stay of proceedings, CWJ relied on, what it contended was, the merit in the grounds of appeal filed, in particular, the following grounds, among others:

• “i) The Court of Appeal was empowered to make the orders pursuant to rules 1.1, 1.7 and [2.14] of the Court of Appeal Rules (‘the CAR’); rules 1.1, 1.2, 1.3 and 26.1(2)(e) of the CPR and section 10 of the Judicature (Appellate Jurisdiction) Act;

• ii) The appeal has a real prospect of success; and

• iii) If the proceedings in the court below were allowed to continue simultaneously with the appeal, the appeal could be rendered nugatory.”

14 During the hearing of the application in chambers before the single judge, counsel for the respondent at the time, Mr Andre Sheckleford, submitted that neither the court nor a single judge of the court had jurisdiction to grant a stay of proceedings in the Supreme Court pending appeal. The single judge did not accept that the court had no jurisdiction to grant an order for stay of proceedings but agreed with Mr Sheckleford that a single judge of the court did not have the jurisdiction to do so. Consequently, he made the following orders:

• “1. A single judge of this court has no jurisdiction to grant the order sought in the notice of application for court orders filed on 19 November 2018.

• 2. Costs to the respondent to be agreed or taxed.”

15 The basis of that order as detailed in judgment recorded as Cable and Wireless Jamaica Limited v Eric Jason Abrahams [2018] JMCA App 44, was as follows:

• “a. Batts J's order is not capable of being stayed. It only brought the matter of the preliminary point to an end.

• b. Rule [2.10(1)(b)] of the Court of Appeal Rules (CAR) cannot apply. A single judge is therefore not given any jurisdiction over the order of Batts J.

• c. Rule [2.10(1)(e)] of the CAR does not seem to apply to proceedings in the court below. Given that rule [2.10(1)(b)] of the CAR expressly speaks to nonprocedural matters, rule [2.10(1)(e)] would seem to refer to proceedings of this court.

• d. Rule [2.13] of the CAR seems to suggest that a single judge could stay proceedings, but nowhere in the rules is that authority actually bestowed.

• e. Whereas the court may be said to have the authority, by rule [2.14(a)] of the CAR, to stay the proceedings pending appeal, a...