Jamincorp International Merchant Bank Ltd v Minister of Finance

• Jurisdiction: Jamaica
• Judge: FORTE, P. , PANTON, J.A. , HARRIS, J.A. (Ag.) , FORTE, P :
• Judgment Date: 29 July 2005
• Neutral Citation: JM 2005 CA 39
• Judgment citation (vLex): [2005] 7 JJC 2912
• Court: Court of Appeal (Jamaica)
• Date: 29 July 2005

IN THE COURT OF APPEAL

BEFORE:

THE HON. MR. JUSTICE FORTE, P THE HON. MR. JUSTICE PANTON, J.A THE HON. MRS. JUSTICE HARRIS J.A. (Ag.)

BETWEEN:

JAMINCORP INTERNATIONAL MERCHANT BANK LIMITED

APPELLANT

AND:

THE MINISTER OF FINANCE

RESPONDENT

Miss Carol Davis, Attorney-at-Law, instructed by Carol Davis and Co. for Appellant.

Miss Cheryl Lewis, Attorney-at-Law, instructed by the Director of State Proceedings for Respondent.

COMPANY LAW - Winding up

ORDER:

• 1. The Appeal is allowed.

• 2. The Order of the court below is set aside.

• 3. Stay of the winding-up proceedings granted to allow the shareholders the opportunity to realize the assets in Alcron Limited.

• 4. The company cannot operate as a Bank without first satisfying the statutory requirements for so operating or trading.

• 5. Costs to the Appellant here and in the court below to be taxed if not agreed.

FORTE, P.

1 I agree with the reasons and conclusions advanced by Harris, J.A. (Ag.)

PANTON, J.A.

2 I agree.

HARRIS, J.A. (Ag.)

3 On May 26, 2005 we allowed this appeal from the judgment of Reid, J. We promised to put our reasons in writing. We now do so.

4 A Petition for the winding up of the Appellant company (hereinafter called the company) was filed by the Respondent in October, 1986. The Petition was grounded on section 11 of the Protection of Depositors Act (now repealed.) An order for the winding up of the company was granted on September 9, 1988. The order was made on the grounds that the company was unable to pay sums due and payable to depositors, the value of the company's liabilities exceeded its assets and that the company failed to deliver accounts for the financial year ending 1985.

5 Pursuant to the order and the provisions of the Companies Act, the company was put into liquidation and the Trustee in Bankruptcy was appointed provisional liquidator. Subsequently, Mr. Philmore Ogle was appointed Liquidator. On May 19, 1999, Mr. Ogle submitted his report to the Registrar of Companies in accordance with the requirements of section 228 of the Companies Act. The report shows that the depositors were fully paid with interest at 6% per annum. They received 153% of the sum due to them at the commencement of the liquidation. The Liquidator found a surplus of income over expenditure of $6,123,059.00. The Registrar of Companies failed to respond to the Liquidator and on July 3, 2001 the Liquidator submitted a copy of his Report to Mr. Elworth Williams, a shareholder and director of the company.

6 The next significant step was the filing of a motion by the company seeking an order to stay the winding up proceedings. Reid, J had before him a reissued motion dated January 23, 2003. It was supported by affidavits filed by Elworth Williams, Neville Henry and David Levermore. He dismissed the application and awarded costs to the Respondent. Although he granted leave to appeal he gave no reasons for his decision to dismiss the motion.

7 The following five grounds of appeal were filed:

• "(a) The Learned Judge erred in dismissing the Application for Stay of Liquidation.

• (b) The Learned Judge erred in refusing to return control of the Appellant Company to its directors/and or shareholders.

• (c) The Learned Judge erred in that he failed to give any or sufficient weight to the fact that the Application for Stay of Liquidation and return of the Appellant to its shareholders was supported by the Liquidator appointed by the Court

• (d) The Learned Judge erred in that he failed to give any or sufficient weight to the fact that all the debts of the Appellant had been repaid.

• (e) The Learned Judge erred in that on the evidence before him the Liquidation of the Appellant ought properly to have been stayed and the Appellant Company returned to its shareholders."

8 Miss Davis, for the Company, submitted that the majority of the members of the company and all interested parties have consented to the application, and the creditors have been satisfied. All relevant parties, including the Liquidator are supportive of the order sought. She urged that the Liquidator having made a recommendation that the company be returned to its shareholders, great weight should be placed on the recommendation. Miss Lewis, for the Respondent contended that the Appellant merely places reliance on the Liquidator's recommendations and does not clearly advance evidence showing the reason for which the shareholders desire...