Caricom Investments Ltd v National Commercial Bank Ltd

• Jurisdiction: Jamaica
• Judge: Anderson J.,Aikens J
• Judgment Date: 20 September 2013
• Neutral Citation: [2013] JMSC CIV 120
• Docket Number: CLAIM NO. 2005/HCV 1884
• Court: Supreme Court (Jamaica)
• Date: 20 September 2013

2013 JMSC CIV 120

IN THE SUPREME COURT OF JUDICATURE OF JAMAICA

CLAIM NO. 2005/HCV 1884

Between

Caricom Investments Limited

1st Claimant

and

Caricom Hotels Limited

2nd Claimant

and

Caricom Properties Limited

3rd Claimant

and

National Commercial Bank Limited

1st Defendnat

and

Rio Blanco Development Limited (In Receivership)

2nd Defendant

and

Karl Aird (Receiver of Rio Blanco Development Company Limited)

3rd Defendant

Appearances : Richard Small, Esq, Mrs. Denise Kitson, Mrs Suzanne Risden-Foster and Ms. Sherise Gayle, instructed by Grant, Stewart, Phillips and Co for the Claimants; Charles Piper Esq., Ms Carlene Larmond and Ms. Marsha Locke instructed by Charles E. Piper for the Defendants

Sale of Land by Receiver under powers of sale in debenture and mortgage; Registration of Titles Act section 125; Agreement for the Sale of Land mutually contingent upon Agreement for Sale of Chattels; Failure to provide duplicate certificates of title although purchaser registered on original certificates; sections 81 and 82 of the Registration of Titles Act; whether failure to provide duplicate certificates of title is repudiatory breach; whether failure to provide duplicates “encumbers” the remaining 49 titles involved in transaction; whether remedy available is rescission of the contract; whether when there are mutually contingent agreements, it would be possible to rescind the one without rescinding the other; whether the Rule in Bain v Fothergill applies; Whether bank mortgagee is “vendor” by virtue of conduct after “completion” of sale; whether there is any breach of warranties contained in agreement for sale; whether bank may become liable by “accepting responsibility” to try to secure duplicates; whether person may become vicariously liable for conduct of another after the purported agent was not his agent when the act being called into question was done; whether if there is a breach of implied term what damages are payable and by whom

Anderson J.

In this litigation, hearing dates for which were spread over fifteen months, the basic facts giving rise to the suit took place way back in May 1993, over twenty years ago. At that time, the first claimant (“Investments”) entered into two (2) agreements, one for sale and purchase certain real property on which certain buildings stood, and the other for the purchase of chattels and other property. It is these agreements which are at the heart of the dispute between the parties and it may be appropriate, at the outset, to identify the dramatis personae. All three claimant companies, hereinafter referred to respectively as “Investments”, “Hotels” and “Properties” are and were at all material companies with, according to the Particulars of Claim, “common shareholders and directors”. I accept that based upon the evidence led before me that they were all controlled by businessman, Mr. Richard Lake (“Lake”), the main witness for the claimants. The first defendant (“NCB”) is a commercial bank duly licensed under the Banking Act and is one of the two (2) largest commercial banks operating in Jamaica. The second defendant, (“Rio Blanco”) was a company previously indebted to NCB, allegedly under the terms of a mortgage and also a debenture, and had been put into Receivership pursuant to powers under the terms of the debenture held by NCB over property of the said company. The third defendant, (“Aird”) was an employee of NCB and at the material time the person appointed under the powers in the debenture to carry out the duties as Receiver of Rio Blanco.

It is worth noting that while there are some limited disputes as to facts, many facts are not in contention and the issues turn largely upon an interpretation to be accorded the terms of the agreement for sale and the consequent behaviour of the parties. It will be necessary in due course to focus on the terms of the agreement for sale and, in particular, the provisions thereof which have been so furiously contested by the respective counsel.

It is perhaps the correct place to start by setting out, in extensu, the pleadings of the parties as they stood at the commencement of the hearings. The Claimants' “Finally Amended Claim and Particulars of Claim” are in the following terms and I set these out verbatim.

The Claimants, CARICOM INVESTMENT LIMITED, CARICOM HOTELS LIMITED, and CARICOM PROPERTIES LIMITED all of 20 Hope Road, Kingston 10 in the parish of Saint Andrew claims (sic) against the Defendants, a company incorporated under the laws of Jamaica, 20 Hope Road, NATIONAL COMMERCIAL BANK LIMITED of 32 Trafalgar Road, Kingston 10, RIO BLANCO DEVELOPMENT LIMITED (In Receivership) of Marcliffe, White River in the parish of Saint Ann and KARL AIRD (Receiver) of 82 Hope Road, Kingston 10 in the parish of Saint Andrew, the following relief and orders, namely:

AND THE CLAIMANTS CLAIM AGAINST THE DEFENDANTS FOR:

• 1. Specific performance of Agreements for Sale dated the 3 ^rd day of May 1993.

• 2. Damages for breach of Contract.

• 3. Damages for Breach of Warranty.

• 4. An Order that the Claimants be indemnified for all loses suffered as a result of the suit brought by Rio Blanco Development Limited against the 1 ^st and 3 ^rd Defendants; and the caveat lodged against the Certificate of Title comprised in volume 1229 Folio 161 registered in the name of the 3 ^rd Claimant.

• 5. Interest thereon at one percentage (1%) point above the prime commercial lending rate for such period as this Honourable Court shall think fit in the circumstances of this case.

• 6. Costs and Attorneys' costs.

• 7. Such further and other relief and orders as this Honourable Court shall think fit in the circumstances of the case.

  Dated the 6 ^th day of July 2005

I certify that all facts set out in this Amended Claim Form are true to the best of my knowledge, information and belief.

PARTICULARS OF CLAIM

2 The 1 ^st Defendant is a commercial bank operating from 32 Trafalgar Road, Kingston 10 in the parish of Saint Andrew. The 1 ^st Defendant was at all material times the holder of a debenture over the assets of Rio Blanco Development Company Limited and the Mortgagee of certain properties registered in the name of Rio Blanco Development Company Limited.

3 Pursuant to the said Debenture the 1 ^st Defendant appointed the 3 ^rd Defendant Receiver Manager of Rio Blanco Development Company Limited.

4 On or about the 3 ^rd day of May 1993 the 3 ^rd Defendant, acting as the Receiver of the 2 ^nd Defendant executed two (2) Agreements with the 1 ^st Claimant, namely;

• I) an Agreement for Sale of Land dated the 3 ^rd day of May 1993, and

• II) an Agreement for the Sale of Chattels and Property.

5 At all material times, the 3 ^rd Defendant acted as the agent and/or servant of the 1 ^st and 2 ^nd Defendants in executing the said Agreements.

6 With regard to the Agreement for the Sale of Land, the Defendants agreed to sell and the 1 ^st Claimant agreed to buy the properties described in the Schedule to the said Agreement as follows:

The under-mentioned Certificates of Titles which now make up the HOTEL PROPERTY were FORMERLY comprised in Certificate of Title registered at Volume 1220 Folio 922 of the Register Book of Titles which covered Lots 2 and 3 on the plan part of White River.

ALL THOSE PARCELS of land part of White River in the parish of SAINT MARY being the Strata Lots numbered One Hundred and Sixty-Four on the Strata Plan numbered Four Hundred and Forty-One and Three undivided 1/350 ^th shares in the common property therein respectively and now being all the lands now comprised in Certificates of Title registered at Volume 1230 Folios 761,762,763,764,765,766,767,768,771,778,780,781,782,783,784,785,786,787,788,793,794,795,796,797,798,799,800,802,803,804,805,806,807,808,809,810,813,814,815,817,818,819,820,821,822,823 and 824 of the Register Book of Titles (as are not already disposed of as identified by the expression ‘sold’ in the Schedule of Apartments annexed hereto and marked “A”).

ALL THAT parcel of land part of White River in the parish of Saint Mary being the lot numbered One on the plan of part of White River and being

ALL the land now comprised in Certificate of Titles registered at Volume 1220 Folio 921 of the Register Book of Titles.

ALL THAT parcel of land part of White River in the parish of Saint Mary being the lot numbered Forty-One on the plan of part of White River and being ALL the land now comprised in Certificate of Title registered at Volume 1230 Folio 801 of the Register Book of Titles.

ALL THAT parcel of land part of White River in the parish of Saint Mary being the lot numbered Fifty-One on the plan of White River and being ALL the land now comprised in Certificate of the Title registered at Volume 1230 Folio 811 of the Register Book of Titles.

ALL THAT parcel of land part of white River in the parish of Saint Mary being the lot numbered Fifty-Two on the plan of the part of White River and being ALL the land now comprised in Certificate of Title registered at Volume 1230 Folio 812 of the Register Book of Titles.

OTHER PROPERTY

ALL THOSE PARCELS of land parts of White River situate in the parishes of Saint Ann and Saint Mary together containing by survey Twenty-Nine Acres and being the lands now comprised in Certificates of Title registered at Volume 1229 Folio 161 of the Register Book of Titles. (Hereafter the properties listed in paragraph 6 will be referred to and called “the said lands” collectively).

The 3 ^rd Claimant was at the material time the nominee of the 1 ^st Claimant and Title for the premises registered at Volume 1129 Folio 161 of the Register Book of Titles was registered in the name of the 3 ^rd Claimant. The 2 ^nd Claimant was at the material time the nominee of the 1 ^st Claimant and Title for the remainder of the premises, the subject of the Agreement for was registered in the name of the 2 ^nd Claimant. The Claimants are associated companies and have common Directors...