Gasoline Retailers of Jamaica Ltd v Jamaica Gasoline Retailers Association

• Jurisdiction: Jamaica
• Court: Court of Appeal (Jamaica)
• Judge: Morrison JA,Dukharan JA,Sinclair-Haynes JA
• Judgment Date: 27 March 2015
• Neutral Citation: JM 2015 CA 43
• Docket Number: CIVIL APPEAL NO 120/2012
• Date: 27 March 2015

Between

Gasoline Retailers of Jamaica Limited

Appellant

and

Jamaica Gasoline Retailers Association

Respondent

[2015] JMCA Civ 23

Before:

The Hon Mr Justice Morrison JA

The Hon Mr Justice Dukharan JA

The Hon Mrs Justice Sinclair-Haynes (Ag)

CIVIL APPEAL NO 120/2012

JAMAICA

IN THE COURT OF APPEAL

SUPREME COURT

CIVIL PROCEDURE - Property - Beneficial ownership - Whether appellant competent to bring claim in its own name - Whether appellant was trading as an arm of the respondent - Whether appellant a holding company - Whether ruling of lower Court justified by pleadings and evidence

John Graham and Miss Peta-Gaye Manderson instructed by John G Graham & Co for the appellant

Patrick Foster QC and Lancelot A Cowan instructed by Lancelot Cowan & Associates for the respondent

Morrison JA

Introduction

1 This appeal was heard on 10 and 11 February 2015. At the end of the hearing on the latter date, the court reserved its judgment until 19 February 2015, when it announced that the appeal would be dismissed for reasons to be given at a later date. These are my reasons for concurring in that decision.

2 The appellant (“GRJL”) is a limited liability company. It was incorporated on 29 June 1979. On 24 October 1979, GJRL became the registered owner of property known as Shop 5, King's Plaza, 38 Constant Spring Road, Kingston 10 in the parish of St Andrew (“the property”). The purchase price of the property was $260,000.00.

3 The respondent (“the JGRA”) is an unincorporated association registered under the Trade Union Act. The JGRA functions as an umbrella organisation representing the interests of members engaged in the business of gasoline retailers. Ever since the property was acquired in 1979, JGRA has had the Duplicate Certificate of Title (registered at Volume 1120 Folio 200) in its possession and has occupied the property as its head office.

4 In or around the year 2001, a dispute arose between JGRA and GJRL regarding the beneficial ownership of the property. JGRA's claim was that GJRL holds the property in trust for the JGRA, while GJRL maintained that it holds the property in trust for certain individual members of the JGRA. On 10 July 2010, after a trial lasting over a period of six days, Mangatal J gave judgment for JGRA in the following terms:

‘(a) It is hereby declared that:

(i) The Defendant Gasolene Retailers of Jamaica Limited, the registered owner, holds the property known as Shop No. 5, Kings Plaza, 38 Constant Spring Road, Kingston 10 in the Parish of Saint Andrew, being the land comprised in the Certificate of Title registered at Volume 1120 Folio 200 of the Register Book of Titles, in trust for the Claimant Jamaica Gasolene Retailers Association.

(ii) The claimant Jamaica Gasolene Retailers Association is entitled to the entire beneficial interest in the property known as Shop No. 5, Kings Plaza, 38 Constant Spring Road, Kingston 10 in the Parish of Saint Andrew, being the land comprised in the Certificate of Title registered at Volume 1120 Folio 200 of the Register Book of Titles.

(b) That, subject to the holding of Accounts and Enquiries, the Defendant is ordered to transfer the property known as Shop 5, Kings Plaza, registered at Volume 1120 Folio 200 of the Register Book of Titles to the Trustees of the Claimant at the date of judgment. The costs attendant on such transfer shall be borne by the Claimant.

(c) That should the Defendant fail, neglect and/or refuse to transfer the said property to the Trustees of the Claimant, the Registrar of the Supreme Court is empowered to execute all documents and do all things necessary to register the transfer of the property from the Defendant to the Claimant's said Trustees at the date of judgment.

(d) Accounts and Enquiries are to be held in Chambers on a Date to be fixed by the Registrar, with a view to perfecting the order for transfer of the legal interest in the property to Trustees of the Claimant at the date of judgment. In that regard, the Claimant is permitted to file and serve on the Defendant by the 31 ^st of July 2012, evidence by way of an Affidavit attesting to, and attaching documentary proof, if any, as to whether there are currently Trustees of the Claimant, and if so, identifying these persons.

(e) Liberty to Apply.

(f) Costs of the trial to be the Claimant's to be taxed if not agreed.

(g) Costs of the hearing of the Accounts and Enquiries to be the Defendant's to be taxed if not agreed.’

5 This is GRJL's appeal from Mangatal J's judgment. In addition to disputing JGRA's capacity to bring the proceedings in the court below in its own name, GRJL also challenges a number of the learned judge's findings of fact.

Background

6 The larger part of the background to the matter is not in dispute. In 1975, the Government of Jamaica granted a 5 cent per gallon increase in the price of gasoline. At that time it was agreed that, out of this 5 cent increase, 1 cent would be retained by the petroleum marketing companies and credited to the accounts of the individual members of the JGRA. The objective of this exercise was to create a fund for the repayment of a loan which had had to be taken out by the JGRA to enable its members to meet their obligations to make retroactive payments to service station attendants.

7 In due course, the loan was paid off and surplus funds of the order of $230,000.00 (“the surplus”) remained in the hands of JGRA. It is common ground that the surplus was an aggregation of funds belonging to members in their individual capacities and that the extent of each member's entitlement varied in accordance with the throughput of gasolene sales at their respective gas stations. The entire surplus was in due course applied by JGRA to the purchase price of the property. The balance of $30,000.00 due on the purchase price was supplied (as to approximately $21,000.00) by United Gasolene Retailers Ltd (“UGRL”), a connected company of JGRA, and by JGRA itself. It is also now common ground that, as the judge found (at para. [110] of her judgment), some members of JGRA ‘did receive a refund of their share of the surplus from the JGRA after the purchase of the property’.

8 The dispute between the parties surrounds the capacity in which the surplus was held by JGRA immediately before it was applied to the purchase price of the property. JGRA's case was that its members had agreed that the surplus should inure to the benefit of JGRA for use in the purchase of property to function as its head office. GRJL on the other hand insisted that what was agreed was that the surplus would be retained by JGRA for the benefit of individual members.

The pleadings

9 In its further amended statement of claim, JGRA, after stating the history described above, averred as follows (at paras 4–9):

‘4. At all times material the aforementioned loan was paid off, and a surplus of funds accrued to the Plaintiff. Thereafter, in 1976 and 1977, the Managing Committee of the Plaintiff proposed, and the Plaintiff's membership agreed, to use the surplus funds to purchase a property to meet the expanding needs of the Plaintiff.

5. At all times material, the Plaintiff through its managing committee was advised that a company was required to be formed as the Plaintiff lacked the legal capacity to purchase and/or hold real property in its own legal right.

6. That the Plaintiff will say that its membership of the day were [sic] never officially informed of the above referenced acquisition at any Annual General Meeting or any other forum of record.

7. Consequently, on or about June 29, 1979, the Defendant company was formed comprising of and drawing its directorship entirely from the then Managing Committee of the Plaintiff, namely:

W.E. Clarke	D. Hall	A. Abrahams
R. Chin	A. Chuck	A. McKenzie
N. Bowen	A. Hobbins	D. Whittingham

8. That pursuant to the mandate of the Plaintiff through its Managing Committee of the day, and with the express intention of making a real estate acquisition on behalf of the Plaintiff, the defendant purchased and became owner of property at Kings Plaza registered at Volume 1120, Folio 200, on or about October 24, 1979.

9. That approximately $216,000.00 of the stated purchase price of $230,000.00 was provided by the Plaintiff from the aforesaid fund, to buy the said property.

10. That at all times material, from and since 1979, the Plaintiff, through its members, sought to have the Defendant company, through its members, give an account of and transfer to the assets of the Plaintiff, the said property at issue.’

10 In these circumstances, JGRA contended, GRJL held the surplus and the property ‘on trust for and on behalf of [JGRA] and its members’. JGRA accordingly sought various reliefs, including a declaration to that effect.

11 In its defence, GRJL maintained (at para. 3) that the surplus ‘accrued to and for the benefit of individual members of and not [JGRA]’ and that ‘some and not all of the members agreed to purchase the said property’. Further (at para. 7) ‘…that its purchase of [the property] was not made pursuant to the mandate of [JGRA] nor was the purchase made with the intention that the premises would have been acquired on behalf of [JGRA]’.

The evidence

12 The evidence at the trial was partly oral and partly documentary. Oral evidence was given on behalf of JGRA by Mr Hopeton Nembhard, who first became an active member of the association in 1979 and served as its president from 1988–1990; and Mr Leonard Green, who became a member in 1996 and was the president in 2000–2001, during the period when the dispute first arose. On behalf of GRJL, oral evidence was given by Mr Aston Hobbins. Mr Hobbins had been a member of JGRA from 1959, a director since 1979 and served as president from 1986–1988.

13 Neither Mr Nembhard nor Mr Green was a member of the JGRA...