Dorrett Wong Sam v Jamaican Redevelopment Foundation Inc.

• Jurisdiction: Jamaica
• Judge: Laing J
• Judgment Date: 23 March 2018
• Neutral Citation: [2018] JMCC Comm 13
• Docket Number: CLAIM NO. 2013CD00098
• Court: Supreme Court (Jamaica)
• Date: 23 March 2018

[2018] JMCC Comm 13

IN THE SUPREME COURT OF JUDICATURE OF JAMAICA

COMMERCIAL DIVISION

Laing J

CLAIM NO. 2013CD00098

Between

Dorrett Wong Sam

Claimant

and

Jamaican Redevelopment Foundation, Inc

Defendant

Mr Kent Gammon and Ms Chemell Wright instructed by Kent Gammon and Associates, Attorneys-at-Law for the Claimant

Mrs Sandra Minott-Phillips QC and Mr Lithrow Hickson instructed by Myers Fletcher & Gordon, Attorneys-at-Law for the Defendant

Mortgage - Whether exercise of statutory power of sale is subject to the Limitation of Actions Act

Evidence - Without prejudice communication — Principles — Whether communication containing clear admission of debt excluded

Witness statement - Whether witness who does not identity her purported witness statement may be permitted to give viva voce evidence

IN OPEN COURT

1 This Claim concerns four parcels of land (collectively “the Properties”). The Properties were pledged by the Clamant and Ms Clara Douglas as security for loans made by Workers Savings and Loan Bank Limited (“WSL”) and National Commercial Bank Jamaica Limited (“NCB”) (collectively “the Loans”). The Loans were made to Sips Lounge Limited and Wong Sam's 24 Hrs. Limited, businesses with which the Claimant is associated.

2 The Claimant is a company incorporated in the United States of America (“USA”). The Claimant purchased the Claimant's debts which arose from the Loans together with the underlying security and had mortgages registered in its name on the Certificates of Title in respect of the Properties (collectively “the Mortgages”).

3 By this Claim the Claimant seeks an accounting of every loan which the Defendant asserts is owing to it, a declaration that the Loans are statute barred, discharges of the Mortgages, the return of the Certificates of Title in respect of the Properties, damages for the unlawful detention of the Properties and an injunction to restrain the Defendant or its servants or agents from disposing of the Properties.

4 The Claimant's statement of case is based on a multi-pronged challenge to the Defendants right to exercise its powers of sale as contained in the Mortgages and it is necessary to explore these in turn. However, before doing so, in keeping with the sequence of events at the trial, I will first address a preliminary issue which arose for determination.

The issue of admissibility of without prejudice communication

5 Prior to the trial, the Claimant filed a notice of application seeking an order prohibiting the Defendant from using and adducing evidence in respect of a letter dated 21 ^st September 2012 from Garth E. Lyttle & Co., Attorneys-at-law, which was sent to the Manager of the Defendant (the “21 ^st September Letter”). The Claimant also sought to prohibit the introduction into evidence, of an email dated 22 ^nd October 2012 at 7:42 pm from Jason Rudd of the Defendant to Mr Anthony Levy the then legal representative of the Claimant (the “Rudd 7:42 pm e-mail”). Flowing naturally from the desire to exclude the 21 ^st September Letter, the Claimant also sought to have paragraph 16 of the witness statement of Mr John Jordan filed on 8 ^th December 2017 struck out on the ground that it referred to the 21 ^st September Letter. The Application was adjourned to the trial and was heard as a preliminary point.

6 It is helpful to set out the 21 ^st September Letter in its entirety hereunder:

Attention: Mr. John Jordon

Dear Sir,

Re: Outstanding Loans Nos. 10207387, 10202709 and 10202710

Creditor: Dorrett Wong Sam

We refer to yours of the 15 ^th May, 2012 and also our meeting on the 18 ^th instant, with representatives of Mrs. Wongsam and your good self.

Arising from the discussions our client has instructed me to advise you she is prepared to pay you within ninety days (90) eighty Five Thousand U.S. Dollars (US$85,000.00) as full and final payment to liquidate the mortgage loans on two properties namely:-

Residential premises situated at Hampton Green District, St. Catherine; and

Commercial property situated at Ffrench Street, Spanish Town in the parish of St. Catherine.

Our client further advises that she has no difficulty in authorizing the sale of the other two properties to liquidate the balance owing under the other two mortgages.

Kindly acknowledge the receipt of this letter by signing and returning to us the enclosed cover letter.

Yours faithfully, Garth R. Lyttle & CO,

7 The Rudd 7:42 pm email reads as follows:

WITHOUT PREJUDICE Mr. Levy,

After we spoke, I talked to our account officer who is handling this account. He indicated that he had reached an agreement two weeks ago with Garth Lyttle, who was representing the debtor at the time. At that time your client agreed to pay US$85K within 90 days in exchange for the release of two of the properties released, and agreed that JRF would be allowed to sell remaining two properties and accept net proceeds as settlement for the rest of the debt.

I am not sure what has changed with your client in the last two weeks, or if you had been made aware of our agreement.

Jason

Sent from my iPhone

8 In Rush & Tompkins v Greater London Council and another 1988 3 All ER 737 at page 739j–740c, Lord Griffiths explained the basis for the rule as follows:

“The ‘without prejudice’ rule is a rule governing the admissibility of evidence and is founded upon the public policy of encouraging litigants to settle their differences rather than litigate them to a finish. It is nowhere more clearly expressed than in the judgment of Oliver L.J. in Cutts v. Head [1984] Ch. 290, 306 :

‘That the rule rests, at least in part, upon public policy is clear from many authorities, and the convenient starting point of the inquiry is the nature of the underlying policy. It is that parties should be encouraged so far as possible to settle their disputes without resort to litigation and should not be discouraged by the knowledge that anything that is said in the course of such negotiations (and that includes, of course, as much the failure to reply to an offer as an actual reply) may be used to their prejudice in the course of the proceedings. They should, as it was expressed by Clauson J. in Scott Paper Co. v. Drayton Paper Workers Ltd. (1927) 44 R.P.C. 151, 156 , be encouraged freely and frankly to put their cards on the table… The public policy justification, in truth, essentially rests on the desirability of preventing statements or offers made in the course of negotiations for settlement being brought before the court to trial as admissions on the question of liability.’

The rule applies to exclude all negotiations genuinely aimed at settlement whether oral or in writing from being given in evidence. A competent solicitor will always head any negotiating correspondence “without prejudice” to make clear beyond doubt that in the event of the negotiations being unsuccessful they are not to be referred to at the subsequent trial. However, the application of the rule is not dependent on the use of the phrase “without prejudice” and if it is clear from the surrounding circumstances that the parties were seeking to compromise the action, evidence of the content of those negotiations will, as a general rule, not be admissible at the trial and cannot be used to establish an admission or partial admission.”

9 It should be noted that the 21 ^st September Letter did not contain the words without prejudice whereas the Rudd 7:42 pm e-mail did. However neither counsel made an issue of this in clear recognition that the rule may be engaged in appropriate cases whether or not the relevant communication is expressed to be without prejudice.

10 It was submitted by Mr Gammon that the 21 ^st September Letter was merely seeking information which did not result in an agreement and furthermore it was not written on the instructions of the Claimant. Accordingly counsel submitted that it is clothed with the without prejudice protections and he relied on the case of Winston Finzi and Another v Mahoe Bay Company Limited and Another [2016] JMCA Civ 34. In that case the Jamaican Court of Appeal carried out an extensive review of the law relating to without prejudice communication and reaffirmed the applicability of cases such as Rush & Tompkins Ltd v Greater London Council and Anor (supra) and Bradford and Bingley plc v Rashid [2006] All ER (D) 145 (Jul).

11 In response, Counsel for the Defendant submitted that in the 21 ^st September Letter the Claimant did not dispute the debt but merely set out the terms on which she was willing to pay it. Counsel relied on the case of Bradford and Bingley (supra) and in particular the statement of Lord Hope of Craighead at para [33] as follows;

“[33] How then do the letters of 26 September 2001 and 4 October 2001 stand up to examination? Neither of them contained the words ‘without prejudice’, so the issue is whether they are protected by the public policy rule. It seems to me that the first letter does two things. It contains a clear admission that there is a balance of debt that is still outstanding and then there is a request for the time to pay. The Court of Appeal ( [2005] EWCA Civ 1080, [2005] All ER (D) 330(Jul)) agreed with the judge that it was written as part of an attempt to negotiate. But there is no suggestion in this letter that the amount of the debt itself was open to compromise. The only issue that was being opened up for compromise was how that debt was to be paid off. In my opinion there is nothing in this letter that entitles the respondent to the without prejudice privilege. The second letter, on the other hand, contains both an admission and an offer to compromise. The admission is that there is an amount which is still outstanding. The offer is to pay £500 in full and final settlement of it. But it does not contest the outstanding amount. On the contrary, it is based on what the respondent can offer to pay, not on...