Clarke v Bank of Nova Scotia Jamaica Ltd
| Jurisdiction | Jamaica |
| Judge | SMITH, J.A. , COOKE, J.A. , HARRIS, J.A. |
| Judgment Date | 02 October 2009 |
| Neutral Citation | JM 2009 CA 93 |
| Judgment citation (vLex) | [2009] 10 JJC 0204 |
| Court | Court of Appeal (Jamaica) |
| Date | 02 October 2009 |
ARBITRATION - Agreement - Whether parties bound by agreement - Whether the parties has reached an agreement
This is an appeal against the order of Marsh J. made on March 19, 2009 whereby he dismissed the appellant's claim for, among other things, a declaration that the appellant and the respondent are bound by agreement to submit to arbitration the existing dispute between them as to what is a fair and equitable retirement plan for the appellant, having regard to all the circumstances.
Background
The appellant was employed by the respondent from April 16, 1968 until his early retirement on November 1, 2008. He served the respondent for the last thirteen (13) years as its President and Chief Executive Officer. He was appointed to that position by the respondent's Board of Directors.
The respondent is a commercial bank incorporated under the laws of Jamaica. Its parent company is the Bank of Nova Scotia Limited, Canada (BNS Canada).
On July 8, 2008 the appellant was called to a meeting at BNS Canada as a consequence of allegations of misconduct against him. Present at this meeting were Mr. Robert Pitfield - Chairman of the respondent and Vice President of International Banking of BNS Canada, the Honourable Mayer Matalon - Vice Chairman of the respondent and, of course Mr. Clarke - the appellant. The decision was taken that the appellant should go on early retirement and a compensation package was offered to the appellant. The appellant denied the allegations and rejected the offer.
On July 16, 2008 a special meeting of the Board of Directors was held with a view to discussing the pending retirement of the appellant. The appellant addressed the Board and submitted a document regarding his proposal of the terms and conditions for his retirement package, following which the appellant recused himself.
A lengthy discussion ensued primarily around ensuring that the reputation of the appellant would not be tarnished as a result of how information was being communicated.
The Board agreed on the following:
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(a) The Chairman to revisit the proposal from the appellant including the effective retirement date of October 31, 2008.
(b) The appellant, Mr. Clarke, to announce to staff on August 15 his retirement, subject to satisfactory negotiations being concluded on July 28, 2008.
(c) Dr. Herbert Thompson will be the liaison director between the Board and Mr. Clarke.
(d) A reasonable compromise to be arrived at between Mr. Clarke and BNS on the terms of and timing of his retirement.
(e) That a further meeting be convened on Monday, July 28, 2008 at 7:30 a.m. at the Jamaica Pegasus Hotel, Kingston.
On July 18, 2008 another special meeting was held. The appellant was absent. At this meeting Dr. Thompson updated the Board on the discussions held with Mr. Clarke. The Board agreed that a meeting be held on July 28 to review the following:
"[a] A suitable retirement plan for Mr. Clarke.
[b] Revisit the retirement date if the matters are not finalized.
[c] The date that a successor will be in place.
[d] ..."
The Board also approved the contents of Press Releases (see pages 109–112 of Record).
At the July 28 th meeting the Board was provided with details of the negotiations between the parties. There was clearly no agreement. It was resolved that Mr. Bruce Bowen be appointed President and CEO consequent on Mr. Clarke's retirement. The Board requested an update of negotiations by August 1, 2008.
Up to October, 2008 there was no agreement. The appellant's atforneys-at-law by e-mail dated October 11, 2008 proposed that the matter be submitted to arbitration with a view to resolving the deadlock. By email dated October 12, 2008 Mr. Clarke wrote to his fellow directors requesting that they "give favourable consideration to the proposal that I will demit office as President and CEO on October 31, 2008 on condition that the dispute be referred to an Arbitration Tribunal of eminent persons".
On October 21, 2008 the appellant's arbitration proposal was presented to the Board of Directors by Professor Stephen Vasciannie, a director of the respondent bank and an attorney-at-law. Mr. Robert Armstrong, a Canadian attorney-at-law acting on behalf of the respondent, made a representation to the Board regarding the proposal sent to the appellant. He also submitted a proposed Arbitration Agreement.
The Board discussed the proposals and made the following resolution:
"(a) The retirement package be restated with the value of the supplemental pension foreign exchange protection and car along with a total value of CDN $3.7M or
(b) The parties proceed to Arbitration.
(c) The Arbitration panel be constituted by a panel of three arbitrators selected in the following manner:
• Each party to select an arbitrator of his/its own choice.
• The two arbitrators shall select a Chairman. In the event that the two elected arbitrators are unable to agree upon the selection of the Chairman, the Chairman shall be selected under the London Court of Arbitration (LCIA) Rules.
• The Chairman will decide the location of the Arbitration and the rules to govern the Arbitration.
• The Agreement to be governed by Jamaican Law.
(d) The question to be referred to the Arbitration Panel for determination is:
What is fair and equitable retirement plan for Mr. Clarke having regard to all the circumstances."
On October 22, 2008 Mr. Robert Armstrong, wrote to the appellant's attorney-at-law, Mr. R.N.A. Henriques, Q.C. proposing what Dr. Barnett described as "a new and revised offer to settle". This new proposal sought to enlarge the scope of the arbitration as follows:
"The scope of the dispute will be to determine what if any obligations the parties may have to each other, whether they have breached any obligations and what amount may be due to Mr. Clarke in all the circumstances. All of the circumstances will include, but not be limited to, evidence about the events leading to his retirement."
On October 29, 2008 the appellant's attorneys-at-law wrote to Mr. Robert Armstrong, stating among other things that:
"With respect to the offer to refer the matter to arbitration, the acceptance of which we now confirm, we enclose a draft agreement which we are instructed conform (sic) with the decision of the Board."
On November 3, 2008 the appellant in an attempt to clarify the position, wrote to the Board of Directors via e-mail stating among other things that:
"At a meeting of the Board on October 21 2008, I proposed a resolution which not only indicated my desire to have the matter arbitrated, but set out the basic terms of the arbitration. My understanding is that the Board accepted my proposal as a result of our common understanding that the dispute relating to my early retirement package would be referred to arbitration."
The appellant indicated in this letter that an agreement to proceed to arbitration came into existence at the October 21 st meeting and he repeated the terms of the agreement - see page 144 of the Record.
On November 27, 2008 the respondent's Board met. The appellant was absent. The appellant was subsequently advised that the Board amended the Resolution to read: "That it is a condition of arbitration that conduct must be taken into account".
On December 24, 2008 the appellant filed a Fixed Date Claim Form by which he sought, inter alia a declaration that he and the respondent are bound by agreement to submit to arbitration the existing dispute between them as to what is a fair and equitable retirement plan for the appellant/claimant having regard to all the circumstances.
On February 10, 2009 the respondent filed an Ancillary Claim Form by way of counter claim. By this ancillary claim the respondent sought orders that the appellant vacate and deliver up possession of premises situated at 12 Hyperion Avenue, that the respondent deliver up possession of two (2) automobiles namely BMW 750 and Audi Q7 and that the respondent pay mesne profits.
The matter was heard by Marsh J. who held that there was no binding arbitration agreement between the parties and accordingly dismissed the appellant's claim as stated at the outset. As regards the respondent's ancillary claim by way of counter claim, the learned trial judge found for the respondent and ordered that the appellant (the ancillary defendant) vacate and deliver up possession of the premises in question and deliver up possession of the automobiles on or before the 31 st of May 2009.
The Appeal
The appellant filed fifteen (15) grounds of appeal. Both parties are at one that the primary issue in this appeal is whether the learned trial judge erred in holding that there was no arbitration agreement between the parties. The appellant, through his attorneys-af-law, is saying that there is a binding agreement to proceed to arbitration and that, critical to the determination of this issue is the resolution of the respondent's Board of Directors at the meeting held on the 21 st October, 2008. The respondent's attorneys-at-law contend that there is no such agreement because no consensus ad idem exists as to all the material elements of the alleged contract, within a juristic context which recognizes the absolute freedom of parties to enter, or not, the contracts they want.
Summary of Submissions on behalf of Appellant
Dr. Barnett...
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