MB Development & Investments Ltd v A&A Lime Hall Development Company Ltd

• Jurisdiction: Jamaica
• Judge: Palmer Hamilton, J.
• Judgment Date: 21 October 2022
• Neutral Citation: [2022] JMCC COMM 30
• Docket Number: CLAIM NO. SU2022CD00044
• Court: Supreme Court (Jamaica)
• Year: 2022

Between

MB Development & Investments Limited

Claimant

and

A&A Lime Hall Development Company Limited

Defendant

JM 2022 SC 174

[2022] JMCC COMM 30

CLAIM NO. SU2022CD00044

IN THE SUPREME COURT OF JUDICATURE OF JAMAICA

IN THE COMMERCIAL DIVISION

Civil Practice & Procedure — Application for Prohibitive Injunction — Notice of the application to be given to the Respondent — Factors to be considered when granting an injunction — Whether there is a serious issue to be tried — Whether damages is an adequate remedy — Balance of convenience

Mr. Keith Bishop and Ms. Roxanne Bailey instructed by Bishop & Partners for the Claimant/Applicant

Mr. Nigel Jones instructed by Nigel Jones & Company for the Defendant/Respondent

Mr. Alexander Williams instructed by Alexander Williams & Company for the Interested Party, Ophite Limited

IN CHAMBERS

Palmer Hamilton, J.

BACKGROUND

1 The Claimant (hereinafter referred to as ‘MB Development’), by way of a Claim Form and Particulars of Claim filed on February 9, 2022 is seeking several declarations from this Honourable Court. This matter involves the determination as to the ownership of property located at 28 Cherry Gardens in the parish of Saint Andrew (hereinafter referred to as ‘the Property’). The Orders sought by way of the Claim Form as follows:

• a. A declaration that the Claimant is the beneficial owner of ALL THAT parcel of land part of Cherry Gardens now called Cherry Hill in the parish of SAINT ANDREW being the lot numbered 28 on the plan of party o Cherry Gardens now called Sherry Hill aforesaid deposited in the Office of Titles on the 22 ^nd day of March 1995 of the said shape and dimensions and butting as appears by the said plan and being all the lands registered at Volume 1284 Folio 162 of the Register Book of Titles (“the said Property”).

• b. A declaration that the Defendant holds the said property on trust for the Claimant.

• c. An order that the Defendant shall execute a transfer in favour of the Claimant in respect of the said property within seven (7) days of the date of the order.

• d. Further and/or alternatively, an order for specific performance of Agreement for Sale dated the 12 ^th October 2021, for the Defendant to execute transfer and deliver to the Claimant, the Duplicate Certificate of Title for the said property.

• e. An order that the Registrar of the Supreme Court is empowered to sign any transfer or other documents to give effect to the transfer of the said interest in the property in the event that the Defendant shall fail, refuse and/or neglect to execute the transfer.

• f. Damages for unjust enrichment.

• g. Interest on damages h. Liberty to apply.

• i. Costs and Attorneys' Costs.

• j. Such further and/or other relief as this Honourable Court deems just.

2 It is not in dispute that the parties entered into an Agreement for Sale dated the 12 ^th day of October, 2021 (hereinafter referred to as ‘the first Agreement for Sale’) for the sale of the Property from A&A Lime Hall Development Company Limited (hereinafter referred to as ‘A&A Lime Hall) to MB Development. The crux of the substantive claim surrounds the true construction of special condition numbered 3 in the first Agreement of Sale between the parties. MB Development is alleging that the A&A Lime Hall breached the said Agreement for Sale when they unlawfully cancelled the sale. A&A Lime Hall denies the allegations set out against them and maintained in their Defence that the first Agreement for Sale was lawfully cancelled and there is no agreement subsisting between the parties.

3 Special condition number 3 in the first Agreement for Sale states that, “It is understood and agreed that if the Transfer Tax and Stamp Duty are assessed by the Stamp Commissioner on a value in excess of the purchase price herein, the Vendor shall be entitled to treat this Agreement as rescinded and to serve the Purchasers with a Notice of Rescission within 14 days of the said assessment in which event this Agreement shall automatically be rescinded, SAVE THAT, the Purchaser may within fourteen (14) days of the said assessment, pay to the Vendor' (sic), any additional increase in assessment.”

4 On or about the December 10, 2021, the Attorney-at-Law on behalf of MB Development was informed by the Attorney-at-Law on behalf of A&A Lime Hall that the Tax Administration Jamaica (hereinafter referred to as TAJ) had assessed the transfer tax at a value that is in excess of the agreed purchase price between the parties. Notice of the higher assessment was sent to MB Development on December 10, 2021. MB Development is alleging that by virtue of special condition number 3 they sent to A&A Lime Hall a Manager's Cheque representing the excess transfer tax as assessed by TAJ on the same day they were notified of the assessment. However, A&A Lime Hall makes no admission in this regard. Their defence is that, on the same day, that is December 10, 2021, they instructed their Attorney-at-Law to cancel the first Agreement for Sale pursuant to special condition number 3 and to renegotiate for a higher purchase price and they did not give any instructions or authorization to accept any payment in respect of the increased assessment by TAJ. A&A Lime Hall averred that they instructed their Attorney-at-Law to issue a Notice of Rescission pursuant to the said special condition number 3 and to return the purported payment of the excess transfer tax.

5 MB Development is also alleging that having received a Statement of Account to Purchaser from A&A Lime Hall, it raises concern regarding monies that ought to have been returned and further evidences a breach of contract. However, A&A Lime Hall in their Defence averred that the said Statement of Account has since been corrected and sent to MB Development.

6 Essentially MB Development is claiming that A&A Lime Hall holds the Property on trust for them and as a corollary they are the beneficial owner of the Property under the first Agreement for Sale. While A&A Lime Hall maintains that MB Development has no legal or equitable interest in the said Property as the first Agreement for Sale was lawfully rescinded and is null and void and as such is no longer binding on the parties.

7 A&A Lime Hall has since entered into another Agreement for Sale (hereinafter referred to as ‘the second Agreement for Sale) to sell the Property to a third party, Ophite Limited. This Agreement for Sale is dated the 15 ^th day of January, 2022. Mr. Alexander Williams, a representative for Ophite Limited, was present at the hearing of the Application.

THE APPLICATION

8 The Claim Form and Particulars of Claim was also accompanied by a Urgent Without Notice of Application for Court Orders seeking the following Orders:

• a. The time for filing and serving this Notice of Application for Court Orders is abridged.

• b. Upon the Applicant giving the usual undertaking in damages, an injunction restraining the Defendant, A&A Lime Hall Development Company Limited and/or its nominee/s, its agent/s and/or servant/s from selling, transferring, mortgaging or otherwise disposing of or otherwise dealing in any matter whatsoever in respect of ALL THAT parcel of land part of CHERRY GARDENS now called CHERRY HILL in the parish of Saint Andrew being the lot numbered 28 on the plan of part of Cherry Gardens now called Cherry Hill aforesaid deposited in the Office of Titles on the 22nd day of March 1995 of the said shape and dimensions and butting as appears by the said plan and being all the lands registered at Volume 1284 Folio 162 of the Register Book of Titles (“the said property”), until the trial hereof or for such period as ordered by this Honourable Court.

• c. Costs to the Applicant to be taxed, if not sooner agreed.

• d. Such further and/or other relief as this Honourable Court deems just.

• e. The Applicant's attorneys-at-law to prepare, file and serve the orders herein.

9 The grounds of the Application were as follows:

• (1) In relation to Order 1:

  • a. The Applicant will be unable to give the Defendant the requisite notice, as stipulated under the Civil Procedure Rules, while at the same time, the Applicant has urgent need for the orders sought herein.

• (2) In relation to Orders 2 and 3:

  • a. The Applicant is asserting that, the Claimant is the sole beneficial owner of the said property, and as a corollary the Defendant holds the Property on trust for the Claimant;

  • b. There are serious issues to be tried as the Claimant has filed its claim herein alleging that:

    • i. The Defendant has breached the agreement for sole, to the detriment of the Applicant;

    • ii. The Applicant has spent substantial sums in preparation of developing the said Property;

    • iii. If the injunction is not granted to prohibit the Defendant, its servants, agents and/or nominees from dealing with the said Property before the substantial claim is disposed of, or an interest therein created that could render nugatory any judgment that could potentially be awarded in my favour; and

    • iv. If the Court finds that the Defendant is entitled to rescind the agreement for sale of the said Property, the effect of this order would merely be a delay in its ability to deal with same and any losses suffered by it could be adequately compensated by damages.

  • c. That given the issues arising herein, damages would not be an adequate remedy, if the Applicant were to succeed at trial; and

  • d. The balance of convenience favours the grant of the injunction in terms requested; and

• (3) The granting of the orders herein will further the overriding objective.

SUBMISSIONS ON BEHALF OF THE APPLICANT

10 Counsel on behalf of MB Development, Ms. Bailey, outlined the principles set out in American Cyanamid Company v Ethicon Limited [1975] AC 396 and refined by the Privy Council in National Commercial Bank Jamaica Limited v Olint Corporation Limited [2009] UKPC 16. Learned...