First Union Financial Company Ltd T/A Union One Express v Eduardo Anderson
| Jurisdiction | Jamaica |
| Judge | Batts, J |
| Judgment Date | 01 December 2017 |
| Neutral Citation | [2017] JMCC Comm 37 |
| Docket Number | CLAIM NO. 2013 CD 00035 |
| Court | Supreme Court (Jamaica) |
| Date | 01 December 2017 |
[2017] JMCC Comm. 37
IN THE SUPREME COURT OF JUDICATURE OF JAMAICA
COMMERCIAL DIVISION
Batts, J
CLAIM NO. 2013 CD 00035
Dr. Delroy Beckford instructed by Samuel Beckford, Attorneys-at-law for the Claimant / Ancillary Defendant
Mr. Linton Gordon and Ms. Stacy Mitchell instructed by Foga Daley for the Defendant / Ancillary Claimant
Brian Maggs (t/a BM Builders) (A Firm) v. Marsh and Marsh Jewellery Co. Ltd. [2006] EWCA Civ. 1058 – Keith Garvey v. Ricardo Richards [2011] JMCA Civ. 16 – Benedetti v. Sawiris and others [2013] UKSC 50.
Copyright Act, section 22.
Contract — Services rendered — Oral agreement — Consideration not specified — Part performance — Whether damages should be awarded to the Defendant on a quantum meruit basis
This judgment concerns the resolution of a dispute surrounding the provision of services and whether the remuneration for same included part ownership of the Claimant company. The issue as to who owned the intellectual property used in its business also falls for resolution. The Claim was withdrawn prior to the commencement of trial and therefore only issues raised on the Counterclaim and the Defence to that Counterclaim arise.
The Claimant is a company which carries on an international courier business which facilitates persons in Jamaica making purchases online. It is registered under the laws of Jamaica with registered offices at 13 Barbados Avenue, Cross Roads in the parish of Saint Andrew. The Defendant is an Information Technology Specialist.
It is the Defendant's assertion that he owns undetermined shares in the Claimant by virtue of an oral contract. The terms of that contract involve his providing technical services in return for monetary payment and shares in the company. The amount of shares was to be determined at a future date. He says that he struck this agreement with Mr. Lloyd Campbell the Managing Director of the Claimant. The Claimant denies that there was such an agreement and says that the Defendant was merely contracted to perform the subject services. It is common ground that the Defendant assisted in developing software, and various other forms of intellectual property which were used in the Claimant's course of business.
On the 13 th March, 2013 the Claimant commenced proceedings by way of Claim Form against the Defendant. An Amended Claim Form was filed on 31 st May, 2013 and followed later by a Further Amended Claim Form dated 10 th June, 2013. On 31 st July, 2013 the Defendant filed a Defence and Counterclaim to the Claim. An Amended Defence and Counterclaim was filed on 20 th August, 2013. The Claimant discontinued its claim by way of Notice of Discontinuance dated 15 th May, 2014. The Counterclaim remained and a Defence to Counterclaim was filed on the 2 nd March, 2016.
The Defendant averred that he and Mr. Lloyd Campbell, Managing Director of the Claimant entered into an oral agreement to start an international courier business. The terms of this oral agreement were that the Claimant would finance the venture and he would provide the information technology expertise and management during the start-up phase. The Defendant alleged also that he and Mr. Lloyd Campbell orally agreed that for his input he would be entitled to equity in the business. The percentage of that equity was to be determined in December, 2012, when his contribution to the business was to be assessed.
The Defendant sought the following orders in his amended counter claim filed 20 th August, 2013;
“1. A Declaration that the copyright in the computer software formerly used by the Claimant lies with the Defendant who is the Author of the computer software within the meaning of the Copyright Act and that the Defendant's retention of possession of said computer software in no way violates any alleged rights claimed by the Claimant.
2. A Declaration that the Defendant is the proprietor of the trademark Union One Express and design.
3. A Declaration that the Defendant is beneficially entitled to a percentage of the net profits made through the past, present and future operations of the business Union One Express
4. Recovery of Debt in the sum of $643,500.00 as well as equity in Union One Express of 35% or such other percentage of annual net profits for the period deemed just by the Honourable Court.
5. Damages for breach of contract.
6. Aggravated damages
7. Costs
8. Interest pursuant to Section 3 of the Law Reform ( Miscellaneous Provisions) Act; and
9. Such other and further relief as this Honourable Court deems to be just.”
The Defendant's counterclaim is supported by a witness statement which was filed on the 12 th September, 2017 and stood as his evidence in chief. In it he chronicled the development of his relationship with the Managing Director of the Claimant company. He said that in or about November, 2010 he was engaged as a consultant to perform an IT audit on the computer system of an affiliated business to the Claimant in which Mr. Lloyd Campbell is involved. In early 2011 he was rehired as a consultant to implement changes that he had recommended in 2010. The Defendant said that in his capacity as IT consultant he interacted with Mr. Lloyd Campbell and Mrs. Lessanne Roper-Bennett. Mrs. Lessanne Roper-Bennett is the General Manager of First Union Financial Services Limited. He says that while he consulted at First Union Financial Services Limited, Mr. Lloyd Campbell and himself had several discussions on a variety of possible projects on which they could work together by leveraging his IT experience and the expertise of First Union Financial Services Limited. Subsequent to that discussion the Defendant created a proposal for a joint venture between himself and eMac Office Systems Ltd., a subsidiary of First Union Financial Services Limited. This venture did not materialise. The Defendant says that he and Mr. Lloyd Campbell also considered a payroll programme. However, on or about May 2012 he and Mr. Lloyd Campbell verbally agreed to start an international courier business.
The Defendant said that it was Mr. Lloyd Campbell who suggested the name Union One. The name Union One Express was eventually used as the domain name because “Union One” was not available. The Defendant said that they wanted a domain name that matched the business name. The Defendant said that in accordance with the agreement the Claimant was generally responsible for financing the business. The Defendant said that he provided expertise; IT and managerial. This included conducting research on the requirements for implementation of the idea and leading in its execution as de facto Operations Manager. He said he oversaw the day to day operations after its launch and provided the necessary information technology expertise and logistics coordination.
The Defendant said that he was not an employee of the Claimant. He said that he was held out to be the Operations Manager to make things easier in his interaction with other companies. He said he worked for six months without compensation. He said that there was no agreement for him to receive a salary as it was always a term of the oral agreement between himself and Mr. Lloyd Campbell on behalf of the Claimant that they were business partners and that he would be entitled to equity in Union One Express. He said further that the reason that he did not bill the Claimant was because he was operating under the impression that he was contributing to a joint venture.
The Defendant said that he created intellectual property, inter alia software and trademarks, for use in the Claimant's operations. He said that he was not contracted at any time to perform these services. He also said that he at no time transferred or assigned his copyright to the Claimant or anyone else.
The Defendant said that the oral agreement was not honoured. His past and ongoing contribution was to be rewarded with a share entitlement, a monthly income and the official assumption of the role of Operations Manager. He said that the Claimant backpedalled on their agreement. According to the Defendant Mr. Lloyd Campbell said at first that “Union One”, was bleeding “First Union”. The Defendant indicated to him that he did not believe that to be true and his evidence is that by December, 2012 the Claimant had already achieved its one-year target of 1,000 customers. Mr. Lloyd Campbell then said that he needed an internal audit to determine the profitability of the business. He also asked the Defendant to set out what he was proposing in writing.
The Defendant said that on the 1 st January, 2013 he submitted his proposal to the Claimant which was in the form of a document titled “Operations Management Agreement” dated 31 st December, 2012. He explained that he set out in the document the work that he had already done and what he proposed to do going forward as well as the options for his remuneration and profit/equity share. There was in the document a table of six options for compensation. Each contemplated equity in the Claimant and compensation for continued hands-on involvement in the company. I have reproduced the table below (Exhibit 1 document # 4).
| OPTION | REMUNERATION | EQUITY |
| A | J$ 195,000 per month | 35% |
| B | J$ 215,000 per month | 30% |
| C | J $ 235,000 per month | 25% |
| D | J $ 255,000 per month | 20% |
| E | J$ 275,000 per month | 15% |
| F | J $295,000 per month | 10% |
The Defendant said that after receipt of the proposal Mr. Lloyd Campbell acting for the Claimant initially accepted option A. He said however that Mr. Campbell spoke about the need to have an audit done to; assess his management, reconcile the revenue and ensure there...
To continue reading
Request your trial