David Wong Ken and Others v National Investment Bank of Jamaica and Others

• Jurisdiction: Jamaica
• Judge: Sykes J
• Judgment Date: 29 June 2012
• Neutral Citation: [2012] JMSC Civ 79
• Docket Number: CLAIM NO. 2006 HCV 1847
• Court: Supreme Court (Jamaica)
• Date: 29 June 2012

[2012] JMSC Civ 79

IN THE SUPREME COURT OF JUDICATURE OF JAMAICA

CIVIL DIVISION

CLAIM NO. 2006 HCV 1847

No. 2 (costs)

Between

David Wong Ken

First Claimant

and

Jack Koonce

Second Claimant

and

David Wong Ken (Representative of the Estate of Shirley Shakespeare)

Third Claimant

and

Western Cement Company Limited

Fourth Claimant

and

National Investment Bank of Jamaica

First Defendant

and

Clarendon Lime Company Limited

Second Defendant

and

Limestone Corporation of Jamaica Limited

Third Defendant

and

Dr. Vincent Lawrence

Fourth Defendant

and

Kirby Clarke (representative of the Estate of Horace Clarke)

Fifth Defendant

and

Cezley Sampson

Sixth Defendant

and

Vinroy Gordon

Seventh Defendant

Lord Gifford QC , David Batts and Miguel Williams instructed by Livingston Alexander and Levy for the claimants

Charles Piper and Marsha Locke instructed by Charles Piper & Associates for the first defendant

Garth McBean and Teri-Ann Lawson instructed by DunnCox for the second, third and fifth defendants

COSTS — RULE 64.6 OF THE CIVIL PROCEDURE RULES — WHETHER COSTS SHOULD BE REDUCED — WHETHER COURT SHOULD REDUCE COSTS ON ISSUE-BASED METHOD

IN OPEN COURT

Sykes J

1 The main judgment was delivered in this matter on March 16, 2012 ([2012] JMSC 32). The question of costs was reserved until further order. This judgment deals with costs. The claimants now apply for the costs of the trial to be apportioned between the claimants and the defendants in proportion to the time spent on the respective issues and in particular on the issues on which the claimants succeeded and the defendants or any of them failed. The grounds on which this application is based are as follows:

• a. the claimants partially succeeded on the issues that were before the court;

• b. in such circumstances it would be just to apportion the costs based on the time spent on the respective issues.

2 The claimants' basic proposition is that they succeeded on one aspect of the tort of misfeasance in public office against Mr Horace Clarke and also succeeded in establishing that National Investment Bank of Jamaica (NIBJ) owed a fiduciary duty to Western Cement Company (WCC) and breached that duty. This success, it is said, entitles them to have seventy five (75%) percent of their costs paid by the NIBJ, Clarendon Lime Company Limited (CLCL), Limestone Corporation of Jamaica (Licojam) and Miss Kirby Clarke who represents the estate of Mr Clarke who has died since the claim began.

3 WCC's bold submission on the costs issue rests on the assertion that the misfeasance in public office and breach of fiduciary duty issues consumed most of the trial time. In addition, it was submitted that the lack of proper disclosure by CLCL prevented WCC from closing its case on March 4, 2011. This lack of proper disclosure, it was said, led WCC to apply, during the trial, for an order of specific disclosure of CLCL's minutes of board meetings. This prolonged the trial unnecessarily and should be taken into account when determining the costs payable.

4 The claimants rely on paragraphs 209 — 211 of the decision of Munby J in R (ota Watts) v Bedford Primary Care Trust, Secretary of State of Health [2003] EWHC 2401 (Admin) (21 ^st October 2003). This case produced two judgments: one on the substantive issues raised in a judicial review and the other on costs. To place his Lordship's costs judgment in perspective it is necessary to have regard to the facts and issues of the substantive case which is R (ota Watts) v Bedford Primary Care Trust and anor [2003] EWHC 2229 (Admin) (1stOctober 2003); [2003] All ER (D) 20 (Oct).

5 The facts of the main judgment were that the claimant required a medical procedure but because of the long waiting lists of the National Health Service decided to seek treatment outside of the United Kingdom. She received the treatment. She then sought to recover the full costs of her treatment. Munby J concluded that under domestic law the claimant did not have a remedy (paragraph 43). The judge then considered her claim under human rights law and concluded that she had no remedy there either (paragraph 55). Munby J then examined her claim under European Community Law and concluded that her basic contention that EU law applied to her case was correct but she failed on the facts.

6 In the costs judgment Munby J ordered the Secretary of State to pay 35% of the claimant's cost. The reasoning was that the claimant has succeeded in establishing an important legal principle which would benefit future litigants albeit that the claimant failed on the facts. However, his Lordship did say that since the claimant lost overall she was not entitled to recover her full costs but the costs orders should reflect the success on the various issues in the case. Reasoning by analogy, the claimants in the case before this court submit that a similar principle ought to be applied to them.

The controlling rule of the Civil Procedure Rules

7 The relevant rule of the Civil Procedure Rules (CPR) is rule 64.6 which reads as follows:

(1) If the court decides to make an order about the costs of the proceedings, the general rule is that it must order the unsuccessful party to pay the costs of the successful party .

(2) The court may however order a successful party to pay all or part of the costs of an unsuccessful party or may make no order as to costs .

(3) In deciding who should be liable to pay costs the court must have regard to all the circumstances .

(4) In particular it must have regard to —

(a) the conduct of the parties both before and during the proceedings;

(b) whether a party has succeeded on particular issues, even if that party has not been successful in the whole of the proceedings;

(c) any payment into court or offer to settle made by a party which is drawn to the court's attention (whether or not made in accordance with Parts 35 and 36);

(d) whether it was reasonable for a party —

(i) to pursue a particular allegation; and/or

(ii) to raise a particular issue;

(e) the manner in which a party has pursued —

(i) that party's case;

(ii) a particular allegation; or

(iii) a particular issue

(f) whether a claimant who has succeeded in his claim, in whole or in part, exaggerated his or her claim; and

(g) whether the claimant gave reasonable notice of intention to issue a claim

(5) The orders which the court may make under this rule include orders that a party must pay —

(a) a proportion of another party's costs;

(b) a stated amount in respect of another party's costs;

(c) costs from or until a certain date only;

(d) costs incurred before proceedings have begun;

(e) costs relating to particular steps taken in the proceedings;

(f) costs relating only to a distinct part of the proceedings;

(g) costs limited to basic costs in accordance with rule 65.10; and

(h) interest on costs from or until a certain date, including a date before judgment.

(6) Where the court would otherwise consider making an order under paragraphs (5) (c) to (f), it must instead, if practicable, make an order under paragraphs 5 (a) or (b).

8 This rule makes it clear that the usual rule is that the unsuccessful party pays the costs of the winning party. However, that general rule may be departed from in an appropriate case. In determining whether to depart from the usual rule the court must have regard to the matters set out in the rule and in particular rule 64.6 (3) and (4). The issue, then, is whether the normal rule stated in rule 64.6 (1) should apply in this case.

Analysis of the evidence and submissions

Costs in favour of the first three claimants

9 The court must say that in respect of the first three claimants, it is difficult to avoid the application of the normal rule for a number of reasons. First, the case of the first three claimants never alleged, against any of the defendants, with any degree of particularity any injury done to them which would be actionable. This was not surprising given the way in which the case was eventually projected. The first three claimants were shareholders in WCC. In the normal course of things, shareholders do not have the locus standi to bring an action against persons who are alleged to have injured the company.

10 It was submitted on behalf of the first three claimants that the omission to specify with any particularity the specific conduct engaged in by the defendants which may have caused injury to the first three claimants did not prejudice the defendants in any significant way since the core of the case was always and remained the injury allegedly suffered by WCC. This court takes the view that this is not the appropriate way to examine the matter. The fact of the matter is that the defendants had to retain counsel thereby incurring significant costs. Counsel for the defendants would have had to have done legal research and combed the pleadings carefully to make sure that the allegations did not reveal any valid claim against the defendants. Also, there was nothing to prevent the claimants from seeking to amend their claim at any time before trial to make specific allegations against the defendants. The defendants were forced to maintain, as it has turned out, unnecessary vigilance lest the first three claimants changed tack and amended the pleadings in order to allege, with appropriate specificity, the acts or omissions of the defendants that amounted to the pleaded causes of actions or some other allegation. The defendants could not rest unless and until, they either obtained judgment in their favour against the first three claimants or the claimants formally discontinued proceedings against them.

11 The claimants dropped the claim at the end of the evidence. It is not clear why the first three claimants pursued the defendants right...