Fitz Jackson v The Bank of Nova Scotia Jamaica Ltd

• Jurisdiction: Jamaica
• Court: Supreme Court (Jamaica)
• Judge: Brown Beckford J
• Judgment Date: 15 November 2024
• Docket Number: CLAIM NO. SU2022CD00309

Between

Fitz Jackson

Claimant

and

The Bank of Nova Scotia Jamaica Limited

Defendant

[2024] JMCC Comm 44

CLAIM NO. SU2022CD00309

IN THE SUPREME COURT OF JUDICATURE OF JAMAICA

COMMERCIAL DIVISION

Civil Procedure — Civil Procedure Rules — Summary Judgment — Bills of Exchange Act — Whether any branch of a bank may be considered the Drawee Bank — Rights of Payee — Rights of Payee viz Collecting Bank — Banking Services Act/Regulation — Whether Bank may charge fees for services

Mr. Anthony Williams, Ms. Annette Henry & Ms. Alea Richards instructed by Usim Williams & Co for the Claimant

Mr. Maurice Manning KC and Ms. Allyandra Thompson instructed by Nunes, Scholefield, Deleon & Co. for the Defendant.

Mr. Sundiata Gibbs & Ms. Timera Mason instructed by Hylton Powell for the Bank of Jamaica

Ms. Nerine Small, Mr. Everol McLeod and Ms. Catherine Williams instructed by the Director of State Proceedings for the Attorney-General of Jamaica

IN CHAMBERS IN PERSON

Brown Beckford J

INTRODUCTION

1 I shall point out at the beginning that this judgment will not be some grand treatise on the lawfulness of fees charged by the banks for their services offered to their customers and to the public. The Court is of course aware of the public interest in the outcome of this case. It is understood that the true gravemen of the case lies, not in the return of the relatively paltry sum of Three Hundred and Eighty-Five Jamaican Dollars (JM $385.00), but in the potential impact of the declarations sought on the banking industry, should they be granted.

2 The Claimant, Mr. Fitz Jackson, is the Member of Parliament for the Saint Catherine South Division. The Court takes judicial notice that Mr. Jackson has been a public advocate against some of the fees charged by the banks. The Defendant, the Bank of Nova Scotia Jamaica Limited (“BNS”), is one of the largest commercial banks in the country, with a branch network across the island of Jamaica. 1

3 Mr. Jackson claimed that BNS, in requiring him to pay a fee for the encashment of a cheque presented for payment at one of its branches, breached the Bills of Exchange Act (“BEA”), and is seeking declarations to that effect. 2

4 BNS, in response, argued that it was entitled to charge the encashment fee, which was a standard industry practice. Moreover, Mr. Jackson failed to properly present the cheque when he presented it at the Portmore Branch instead of the Half Way Tree Branch on which the cheque was drawn.

5 Mr. Jackson contended that once BNS admitted to charging the fee, then the cheque became conditional and the sum uncertain. Therefore, there was no valid defence to the claim that it acted in breach of the Bills of Exchange Act. This would thus entitle Mr. Jackson to judgment in his favour. Mr. Jackson has therefore made this application for Summary Judgment.

6 Upon the Application for Court Orders made by BNS, the Court, by Order made on 17 ^th Novemeber 2023, invited the The Bank of Jamaica, (“BOJ”), a body with supervisory and regulatory oversight of commercial banks in Jamaica, and The Attorney General of

Jamaica (“AG”), the legal advisor to the Government of Jamaica, to make submissions in the matter. This was based on the implications that this decision could have on the wider banking industry. The potential for the wider implication of this decision was recognized in National Westminister Bank v Spectrum Plus Limited and Others [2005] 2 AC 680 (“ NATWEST”), 3 where the court said:

To promote a desirable degree of consistency and certainty about the present state of ‘the law’, courts in this country have long adopted the practice of treating decisions on a point of law as precedents for the future. If the same point of law arises in another case at a later date a court will treat a previous decision as binding or persuasive, depending upon the well-known hierarchical principles of ‘stare decisis’.

7 This was also the view of Batts J for the Full Court in James, Rohan and Murphy, Nigel (on behalf of the members of the Jamaica Police Federation et al v Ministry of Finance and Public Service, Commissioner of Police and the Attorney General [2022] JMFC Comm 13 (“ James”), where he stated, 4 “…a declaration, either of law or on the interpretation of an instrument, although unenforceable may have implications for others who are not parties to the proceedings.”

8 The Parties have all agreed that there is no dispute on the material facts, the overriding issue being a question of legal interpretation which renders this case suitable for Summary Judgment. Counsel for Mr. Jackson is correct in that this Court is venturing into somewhat new territory, there being no decided cases on the specific issue in this claim.

9 I am grateful for the submissions made, in writing and orally, which have greatly assisted the Court. Failure to refer to any aspect does not negate its importance to the Court in analyzing the issues. After full consideration of the arguments and authorities, the Court is constrained to find that Mr. Jackson's case has no reasonable prospect of success. Pursuant to Rule 15 (a) of the CPR, Summary Judgment is granted in favour of BNS.

BACKGROUND

10 The parts of Mr. Jackson's Claim Form and Particulars of Claim material to this Application, are set out below:

Amended Claim Form

The Claimant, Fitz Jackson, a Member of Parliament, whose address is Naggo Head, Portmore, in the parish of St. Catherine, claims against the Defendant, The Bank of Nova Scotia Jamaica Limited, whose registered office is situate at the Corner of Duke & Port Royal Streets in the parish of Kingston, for failure to negotiate a cheque/negotiable instrument/bill of exchange to wit: a Bank of Nova Scotia Jamaica Limited Cheque bearing No. 001426 dated the 3rd May 2019 for the sum of Two Thousand Five Hundred Dollars ($2,500.00) and drawn by Ms. Delaine Morgan (a customer and account holder of the Defendant Bank) on Chequing Account # 396214 payable to the Claimant but upon the Claimant presenting the said cheque /negotiable instrument/bill of exchange for encashment on the 3rd May 2019 at the Defendant Bank, The Bank of Nova Scotia Portmore Branch for the full sum specified on the said cheque, the Defendant through its servants and/or agents of the said Portmore BNS Branch, informed the Claimant that the policy of the Defendant Bank is that unless and/or until he (the Claimant) pays a bank fee/encashment fee of Three Hundred and Eighty-Five Dollars ($385.00) in cash or allow the Defendant Bank to deduct the said bank fee /encashment fee of $385.00 from the amount specified on the said cheque /negotiable instrument/bill of exchange on the Defendant Bank will not encash same.

That the Claimant paid the said bank fee/encashment fee of $385.00 to the Defendant Bank, Portmore Branch under protest to encash the said cheque and was issued a receipt for same and cash in the sum of Two Thousand One Hundred and Fifteen Dollars ($2,115.00) which is less than the sum specified on the said cheque/negotiable instrument/bill of exchange to be paid by the Defendant Bank as ordered or instructed by the drawer of the said cheque for the Defendant Bank to pay unconditionally to the order of Mr. Fitz Jackson the specified sum on the said cheque and in contravention of the provisions of the Bills of Exchange Act.

Amended Particulars of Claim

9. PARTICULARS OF BREACH

• I. Failing and/or refusing and/or neglecting to pay the Claimant the full sum of Two Thousand Five Hundred Dollars ($2,500.00) as specified on the said cheque/negotiable instrument/bill of exchange whereby the Claimant received the net sum of Two Thousand One Hundred and Fifteen Dollars ($2,115.00)

• II. Imposing a bank encashment fee or charge of Three Hundred and Eighty-Five Dollars ($385.00) as a stipulation /requirement to the Claimant in order for the said cheque/negotiable instrument/bill of exchange to be encashed and thereby changing the quality of the said cheque/negotiable instrument/bill of exchange whereby the said cheque became a qualified conditional order instead of an unqualified, unconditional order payable on demand, ordered or instructed by the drawer to the Defendant Bank to pay the full sum specified on the cheque.

• III. Imposing a bank fee/encashment fee for the encashment of the said cheque/bill of exchange so as to cause the provisions of the Bill of Exchange Act to be subordinate to the Defendant Bank's unilateral, arbitrary and capricious policies it imposes for a cheque to be encashed.

• IV. Failing and /or refusing and /or neglecting to honor its obligation to settle on demand and unconditionally, the face value of the said cheque/bill of exchange/negotiable instrument by paying the Claimant a lesser sum than that specified on the said cheque.

• V. Failing and/or neglecting as a banker and drawee of the said cheque/negotiable instrument to honour a negotiable instrument in contravention of it's obligations under the Bills of Exchange Act.

11 In its Further Amended Defence, BNS pleaded:

5. In response to paragraph 5 of the Claimant's Amended Particulars of Claim, the Defendant will say as follows:

• (a) The Defendant admits that the Claimant presented a cheque for encashment to the Defendant's BNS Portmore Branch.

• (b) It is customary for banks in Jamaica and in other jurisdictions to charge a fee for encashment of cheques at the counter.

• (c) In accordance with the custom which exists in Jamaica, it was the Defendant's policy to levy a fee where cheques are presented for encashment by a payee at the counter. At that time, the payee could choose to pay the fee to facilitate immediate encashment of the cheque or lodge same with the Defendant bank, if he had an account, or his own bank.

12 By this Application Mr. Jackson is seeking the following Orders:

• 1. Summary Judgment in favour of the Claimant, Fitz Jackson, against the...