Antigua Aggregates Ltd v 1) Attorney General of Antigua and Barbuda 2) Antigua Commercial Bank Limtied

• Jurisdiction: Antigua and Barbuda
• Judge: GEORGE-CREQUE, J.A.,Justice of Appeal,Janice George-Creque,Michael Gordon, QC,Davidson Baptiste,Justice of Appeal [Ag.]
• Judgment Date: 19 October 2009
• Judgment citation (vLex): [2009] ECSC J1019-1
• Court: Court of Appeal (Antigua and Barbuda)
• Docket Number: HCVAP 2009/003
• Date: 19 October 2009

[2009] ECSC J1019-1

IN THE COURT OF APPEAL

Before:

The Hon. Mde. Janice George-Creque Justice of Appeal

The Hon. Mr. Michael Gordon, QC Justice of Appeal [Ag.]

The Hon. Mr. Davidson Baptiste Justice of Appeal [Ag.]

HCVAP 2009/003

Antigua Aggregates Limited

Appellant

and

[1] The Attorney General of Antigua and Barbuda

[2] Antigua Commercial Bank Limtied

Respondents

Appearances:

Mr. Hugh C. Marshall Jr. and Ms. Cherisse Roberts-Thomas for the Appellant

Ms. Karen Defreitas-Rait for the First Respondent

Sir Clare Roberts, Q.C., And Ms. C. Kamilah Roberts for the Second Respondent

Civil Appeal — Land Law — removal of restriction — whether application to be made to the Registrar of Lands or directly to the court — basis for removal of restriction —mandatory injunction — least risk of injustice Mortgage claim CPR Part 66 —claim for an account from chargee — whether mortgagee should be restrained from exercising power of sale — whether chargor should be permitted to sell charged property without chargee's consent — whether there was a serious issue to be tried — adequacy of damages — balance of convenience — fetter of right of redemption — sections 67, 68 and 134 of the Registered Land Act Cap. 374 of the Revised Laws of Antigua and Barbuda

The appellant is the proprietor of two parcels of land situate at Crabbs ("the Property") allegedly purchased from the Crown at an undervalue. The main directors of the appellant company were then ministers of Government. The Property was charged to the second respondent ("the Bank") as security for loan(s) made by the Bank to Galeforce Windows, in which the appellant had a majority shareholding. The loan(s) fell into arrears and some $3.6 million is due to the Bank under the charge. The Bank has already obtained judgment in a separate action for an unsecured substantial sum against the appellant.

The Attorney General filed a claim against the appellant seeking rescission of the agreement of sale on the ground of illegality. By application to the Registrar of Lands, the Attorney General caused a restriction to be placed on the Property. With the intention of exercising its rights as chargee, having served notices for payment on the appellant, the Bank retained the services of an auctioneer and advertised the Property for sale. In the meanwhile, the appellant entered into a private contract to sell the lands to a third party, allegedly at an undervalue.

The appellant filed a without notice application seeking an order directing the Registrar of Lands to remove the restriction placed against the lands; preventing the Bank from exercising its power of sale; requiring an accounting from the Bank in relation to the monies that were paid towards the loan; and permitting it to sell the lands by private treaty and to have the monies paid into court. The fixed date claim form which was filed subsequently seeks declarations and injunctions in similar terms. No relief is sought against the Attorney General who it appears had been joined solely for the purpose of the interlocutory application.

The application was heard inter partes and dismissed on the ground that: (1) the application for the removal of the restriction should have been made to the Registrar of Lands and not the court; (2) the least risk of injustice in the particular circumstances favoured the court declining to grant the mandatory order, that is, the order that the restriction be removed; (3) there was no basis for concluding that the restriction had been improperly placed on the Property; (4) the application with regard to the Bank was, in essence, an application for an interim injunction which did not fit the general matrix for the grant of an injunction; and (5) an order permitting the appellant to sell the Property would sanction a breach of section 67(g) of the Registered Land Act Cap. 374 ("the RLA"). The appellant has appealed against these findings.

Held: dismissing the appeal with costs to the respondents:

• 1. Section 134(1) of the RLA deals with the circumstances in which any person (other than the proprietor) interested in the land may apply to the Registrar for removal or variation of a restriction. Section 134(2) of the RLA however gives a free standing right to a registered proprietor to apply directly to the court for such removal or variation. The appellant, being the registered proprietor, was competent to invoke the court's jurisdiction in seeking removal of the restriction. The trial judge accordingly erred in holding that the court lacked jurisdiction to entertain the application on the basis that the procedure laid down was for application to first be made to the Registrar of Lands.

• 2. No notice of the application was given to the Registrar of Lands as required by section 134(2) of the RLA. This lack of notice coupled with the fact that removal of the restriction was sought by way of interlocutory proceedings prevented a proper ventilation of the matter by way of a full trial on the merits. In essence, the appellant sought a final remedy by way of interlocutory proceedings which was wholly inappropriate. The learned judge accordingly properly refused the application.

• 3. Having regard to the purpose for which the restriction was placed on the Property, the three year delay before any step was taken by the appellant to remove the restriction and the reason now being advanced for its removal, the learned judge quite rightly determined that the least risk of injustice in the particular circumstances favoured the court declining to order the removal of the restriction.

  Zockoll Group Ltd. v Mercury Communications Ltd. (No. 1) [1998] FSR 354 applied.

• 4. Further, as the learned judge rightly found, it had not been shown that the restriction had been improperly placed or by inference, that there was a change of circumstances since the placement of the restriction. The fact that the appellant chose to enter into an agreement for sale of the Property some 3 years later, despite the restriction thereon and the bank charges, does not equate to a change of circumstances.

  Christopher and DeCastro (Executor for O Flax) v The Registrar of Lands and The Attorney General BVIHCV 2002/0200 followed.

• 5. The fact that the appellant required an accounting from the Bank in terms of what was owed to the Bank did not give rise to an issue as to whether or not the Bank was entitled to exercise its power of sale. In essence, the appellant did not show how sale of the Property by the Bank in the exercise of its power of sale infringed any right of the appellant as chargor as it related to its entitlement to an accounting. The exercise of the power of sale does not hamper, diminish or infringe the appellant's right to an accounting from the Bank. The learned judge accordingly did not err in finding that there was no serious issue to be tried.

• 6. The learned judge did not err in holding that damages would be an adequate remedy or that the balance of convenience lay in favour of the Bank.

• 7. Having regard to the instruments of charge and sections 67(g) and 68 of the RLA, the learned judge correctly found that the appellant had no right to sell the Property and thereby fetter the chargee's (the Bank's) rights.

GEORGE-CREQUE, J.A.

1 This appeal arises out of a without notice application filed prior to the issuance of a fixed date mortgage claim1 seeking, inter alia:

• (i) an order directing the Registrar of Lands to remove a restriction on lands registered in the name of the appellant ("the Property") upon payment into court of the proceeds of sale of the Property;

• (ii) an order directing the second respondent ("the Bank") not to sell the Property encumbered by a charge in its favour pending an accounting;

• (iii) an order permitting the appellant to sell the Property; and

• (iv) a full accounting of the loan secured by the charge.

2 The application was heard inter partes and the trial judge dismissed all limbs of the application holding, with regard to the Bank, that the appellant's application was in essence an application for an interim injunction which did not fit the general matrix for the grant of an injunction in that:

• (a) the issue as to whether or not the appellant owes the Bank $2,200,000.00 or a greater sum did not give rise to a cause of action based on the Bank's proposal to sell the Property [para. 46];

• (b) damages would be an adequate remedy for the appellant, but not for the Bank [para.51];

• (c) the balance of convenience lies in favour of the Bank [para.52]; and

• (d) the status quo must be maintained and there should be, in essence, no fetter on the Bank's ability to'liquidate it rights as chargee'. [para.53]

3 The trial judge also held that the grant of an order permitting the appellant to sell the Property would in effect be sanctioning the breach of section 67(g) of theRegistered Land Act2 ("the RLA") by allowing the sale of the charged Property without the consent of the Bank.

4 With regard to the first respondent the trial judge held that the application sought a mandatory injunction compelling the Registrar of Lands to remove the restriction placed on the Property by the Registrar of Lands at the instance of the Attorney General and that such an application ought in the first instance, to have been made to the Registrar of Lands and not to the court pursuant to the provisions of section 134 of theRLA. She further held that there was no basis for concluding that the restriction had been improperly placed on the Property. She went on further to hold that in any event, the application being one seeking a mandatory injunction was not an appropriate case for the grant of such relief in that the least risk of injustice favoured the refusal of such an order.

The grounds of appeal

5 Although multiple grounds of appeal were stated, as it relates to the appellant's case against the Bank, the appellant categorised them...