National Commercial Bank Jamaica Ltd v Sylvia Steens

CourtCourt of Appeal
JudgeMcDonald-Bishop JA,Edwards JA,Phillips JA
Judgment Date19 Feb 2021
Neutral CitationJM 2021 CA 19

[2021] JMCA Civ 7



THE HON Miss Justice Phillips JA

THE HON Mrs Justice McDonald Bishop JA

THE HON Miss Justice Edwards JA


National Commercial Bank Jamaica Limited
Sylvia Steens

Mrs Sandra Minott-Phillips QC and Litrow Hickson instructed by Myers Fletcher & Gordon for the appellant

Lord Anthony Gifford QC and Ms Maria Brady instructed by Gifford Thompson & Shields for the respondent

Phillips JA

I have read in draft the judgment of Edwards JA and I agree with her reasoning and conclusion. There is nothing I need to add.

McDonald-Bishop JA

I too have read in draft the comprehensive judgment of Edwards JA. She has exhaustively and carefully analysed the critical issues necessary for the resolution of this appeal and I endorse her reasoning and conclusion in relation to them. There is nothing that I could usefully add.

Edwards JA

In this appeal, the National Commercial Bank Jamaica Limited (NCB) (“the appellant”), challenged the decision of Thompson-James J (“the trial judge”) made on 5 August 2013, whereby she gave judgment in favour of Ms Sylvia Steens (“the respondent”). The respondent's claim alleged that the appellant was vicariously liable for negligent investment advice she received from its employee, Miss Sandra Cunningham (“Ms Cunningham”), to invest in the Higgins Warner investment scheme, which subsequently failed causing financial loss to her.


The appellant is, and was at the material time, licensed under the Banking Act of Jamaica as a commercial bank. The respondent had been a long-standing customer of the appellant. She was also a customer of NCB Capital Market Limited, which is an investment bank and an affiliate of the appellant, both being a part of the same group of companies.


Having been designated a first class customer of the appellant, the respondent was assigned a personal banker who was Ms Cunningham. Ms Cunningham also happened to be a close personal childhood friend of the respondent. It is unclear whether this was previously disclosed to the appellant. Monies were invested by the respondent in May and June 2007 in an unregulated investment scheme run by Higgins Warner. Between June and November 2007, the respondent received interest on her principal investments in Higgins Warner. The Higgins Warner scheme collapsed in or about November 2007 and all payments to the respondent ceased.

The claim

Subsequent to the collapse of Higgins Warner, the respondent wrote to the appellant, through her attorneys-at-law, in an attempt to recoup her losses. This was to no avail. As a result, on 17 December 2008 she filed suit against the appellant. The respondent alleged that in or about May and June 2007, she met with Ms Cunningham at the Morant Bay branch of the appellant, in the parish of Saint Thomas. On this occasion, Ms Cunningham gave her unsolicited advice about a secure investment scheme, from which she could make more money than that which she was making from the Euro dollar account she held in NCB Capital Markets Limited. She claimed that Ms Cunningham told her she would not lose her money, and advised her to borrow $6,000,000.00 from the appellant to invest in the programme. She was also advised to use her Euro fund as collateral for the loan.


The respondent further alleged that in reliance on this advice she signed several documents which facilitated: (a) the loan from the appellant, (b) the use of €100,000.00 of her Euro fund as collateral; and (c) the investment in the Higgins Warner investment scheme. Of the $6,000,000.00 proceeds from the loan, a portion was converted to US$40,000,00 and invested in Higgins Warner. She also alleged that Ms Cunningham had converted a portion of the loan proceeds received from the appellant to her own use.


The respondent averred that in giving negligent advice, Ms Cunningham, acting in the course of her employment with the appellant, had “failed to act with proper skill and care and/or failed to act in the interests of the [the respondent] but rather acted in furtherance of her own interests, and/or was negligent”. The particulars of negligence were set out as follows:

  • “(1) Advising an investment which was manifestly speculative and unreliable.

  • (2) Failing to give any advice as to the risks associated with such an investment.

  • (3) Furthering her own interests, namely that she was an agent of Higgins Warner and earned commissions from investments which she had introduced.

  • (4) Failing to provide the [respondent] with copies of the documents referred to above so that the [respondent] could study them and understand the nature of the said investment.”


The respondent also pleaded that the appellant was vicariously liable for all loss and damage she suffered as a result of the relevant actions of Ms Cunningham for the following reasons:

  • “(1) The advice was given by Sandra Cunningham at the [appellant] Bank in her capacity as the [respondent's] personal banker.

  • (2) Her torts and/or criminal acts were so closely connected with her employment that it would be fair and just to hold the [appellant] vicariously liable.”


Further, and in the alternative, the respondent sought to rely on the contractual relationship between herself and the appellant as customer and banker, and in accordance with the duty owed by Ms Cunningham as a servant of the appellant to act with proper skill and care and to act with due regard to the respondent's interests and not in furtherance of its own.


The respondent claimed against the appellant a total loss of $2,004,475.28, being the amount she averred would restore her to the position she would have been in had there been no negligent advice, no loan and no investment. She averred that she paid a total of $7,239,349.38 to repay the loan, and in arriving at the sum claimed, she deducted from that sum the moneys that were returned to her by Higgins Warner and Ms Cunningham (with interest) in the amount of $2,520,000.00 and $2,714,874.10, respectively.

The defence

The appellant admitted that the respondent was its customer and that Ms Cunningham had been assigned to her as her personal banker. However, it defended the claim on the basis, in summary, that it was licensed under the Banking Act of Jamaica as a commercial bank, and that licence did not include the giving of investment advice. It averred that it was a separate legal entity from both NCB Capital Markets Limited and Higgins Warner, although NCB Capital Markets Limited is an affiliate. Ms Cunningham, it averred, was only authorized to convey information about its services and to act on its behalf in relation to commercial banking transactions with the respondent. Ms Cunningham was not authorized to give any investment advice, and this, it asserted, was a fact well known to the respondent. The appellant denied that Ms Cunningham gave investment advice to the respondent in her capacity as its servant as alleged. It averred that if Ms Cunningham had given the respondent any advice, she would have done so in her personal capacity, as at the material time, she lived in the respondent's house and they had a relationship that was independent of the respondent's relationship with it.


The appellant also admitted that, on or about 27 June 2007, the respondent borrowed $6,000,000.00 for the purpose of acquiring property and for personal expenses. This was the purpose stated in the application for the loan and the commitment letter dated 25 June 2007, accepted and signed by the respondent. The respondent received the entire loan proceeds from the bank and they were disbursed in accordance with her instructions. The appellant contended, therefore, that if the respondent suffered any loss or damage, such loss was not attributable to it.

The evidence in the court below
(1) The documentary evidence

Approximately 44 exhibits were tendered into evidence at the trial. Of relevance to this appeal are the following:

  • i. a document headed “World Football Idol” dated 22 May 2007 whereby the respondent, by her signature, agreed to an investment of US$4,000.00 in Higgins Warner;

  • ii. a letter of authority dated 20 June 2007 signed by the respondent authorizing NCB Capital Markets to hypothecate the sum of €100,000.00 in her Euro account;

  • iii. a letter dated 25 June 2007 from the appellant advising of the approval of the respondent's application for a loan of $6,000,000.00, which was signed by the respondent in acceptance of the loan;

  • iv. a Deed of indemnity dated 26 June 2007 addressed to NCB Capital Markets Limited and signed by the respondent;

  • v. a cheque dated 27 June 2007 in the amount of $6,000,000.00 representing the loan proceeds made payable to the respondent which she endorsed;

  • vi. a document headed “World Football Idol” dated 27 June 2007 whereby the respondent, by her signature, agreed to an investment of US$40,000.00 in Higgins Warner;

  • vii. several bank statements for the respondent's NCB United States (US) dollar account, a Jamaican dollar account and her loan account;

  • viii. an undated letter from Sandra Cunningham addressed to the respondent and signed by both parties, stating that Ms Cunningham would return US$40,000.00 from the bank loan, which was invested in Higgins Warner, to the respondent;

  • ix. a letter dated 29 April 2008, from Sandra Cunningham to the respondent, stating that she had made full and final payment to the respondent of $2,650,000.00, by way of a Bank of Nova Scotia cheque dated 28 April 2008, and that, in all, she had paid to the respondent $3,194,800.00 in satisfaction of the loan by the respondent to her.


The statements for the respondent's US dollar account indicated that several deposits were made to the respondent's account by Higgins Warner on various occasions, totalling US$36,000.00. The first such...

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