Cibc Caribbean Ltd v Roberts et Al

• Jurisdiction: Antigua and Barbuda
• Judge: Mitchell, J.
• Judgment Date: 16 September 2002
• Neutral Citation: AG 2002 HC 26
• Docket Number: ANUHCV 0096 of 2000
• Court: High Court (Antigua)
• Date: 16 September 2002

High Court

Mitchell, J.

ANUHCV 0096 of 2000

Cibc Caribbean Limited

and

Roberts et al

Appearances:

Eleanor R Clarke for the claimant.

Hugh C Marshall, Cherissa Roberts-Thomas with him, for the defendants.

Civil practice and procedure — Directions for sale of land — Banking — Three charges were charged by the defendants to the claimant — Claimant sought payment of all monies due under the three charges — Claimant by way of Order 58 of the Rules of the Supreme Court, 1970 sought directions from the court for the sale of land — Whether the charges could be enforced by sale by private treaty — Whether the claimant should be given possession of the charged properties — Section 72 of the Registration Land Act — Judgment for the claimant.

Mitchell, J.

1 This is a banker and customer case. It is a claim brought by the claimant bank by way of an Originating Summons under Order 58 of the Rules of the Supreme Court 1970, which provides for directions to be given by the court for the sale of land. The following reliefs were sought by the claimant bank against the defendants:

• (1) Payment of all monies due to the claimant under the three charges referred to in the title above whereby the freehold properties registered as Parcels 73 and 74 of Block 44 1997 B in the Cedar Grove and Crosbies Registration Section (hereinafter referred to as the “Crosbies Property”) and as Parcel 140 of Block 45 1696 B in the McKinnons Registration Section (hereinafter referred to as the “Paradise View Property”) were charged by the defendants to the claimant;

• (2) That the said charges may be enforced by sale by private treaty and the fixing of an upset price;

• (3) Possession of the said charged properties;

• (4) Further and other relief;

• (5) Costs.

2 On 8 May 2001, the defendants filed a Summons for Directions on Counterclaim against the claimant bank. The reliefs sought by the defendants may be summarised as:

• (1) A declaration that the letter dated 16 June 1997 addressed to the defendants and signed by the claimant and the 2nd named defendant (hereinafter “Mrs Roberts”) is the Loan Agreement;

• (2) A declaration that clause 7 in the Instrument of Charge entered on the Register for the Crosbies Property as Entry No 4 and dated 3 July 1997 is void and contrary to the above Loan Agreement;

• (3) A declaration that clause 7 in the Instrument of Charge entered on the Register for the Paradise View Property as Entry No 11 and dated 3 July 1997 is void and contrary to the above Loan Agreement;

• (4) A declaration that clause 7 in the Instrument of Charge entered on the Register for the Paradise View Property as Entry No 10 and dated 20 March 1997 is void and contrary to the Loan Agreement;

• (5) A declaration that the entry No 11 above is in breach of the Loan Agreement;

• (6) Damages for the unlawful registration and consolidation of the charges;

• (7) An order to remove the charges from the Registers on the grounds that the defendants were induced by the claimant to execute the Charges without the benefit of independent legal advice and that the Charges were executed in contravention of the Loan Agreement;

• (8) A declaration that the claimant in accepting the Valuations of 21 April 1997 and 22 May 1997 breached its fiduciary duty to the defendants by not ensuring that the valuations were reasonably accurate;

• (9) In the alternative, a declaration that the claimant in seeking to sell the Crosbies Property at a price below the Force Sale price of the valuations is acting in contravention of its duty as a banker to the claimant and in particular in contravention of section 75 of the Registered Land Act;

• (10) An injunction to restrain the claimant from selling the Paradise View Property.

3 In support of its application for directions for sale by private treaty, the claimant bank filed affidavits by Everett Christian (hereinafter “Mr. Christian”) of 4 May 2000, and 5 June 2002; and of the auctioneer Nathaniel “Paddy” James (hereinafter “Mr. James”) of 4 May 2002. In their defence and in support of their counterclaim, the defendants filed affidavits of the 2nd defendant Angella Roberts (hereinafter “Mrs. Roberts”) dated 9 May and 3 July 2001; and her husband the 1st defendant, George Roberts, (hereinafter “Mr. Roberts”) of 17 July 2002; and attorney-at-law Septimus A Rhudd (hereinafter “Mr. Rhudd”) of 7 July 2002. There were documents exhibited with the various affidavits. Mr. James did not appear to offer himself for cross examination, nor had the claimant given the defendants notice that they did not intend to call him, so that his affidavit was ignored and not considered as evidence in the case. All the other deponents appeared at the trial and offered themselves for cross-examination.

4 The facts as I find them are as follows. The claimant is a registered bank doing business at St John's in Antigua. Mr. Christian, the claimant's witness, is its Independent Business Manager. Previously, his official designation was Assistant Manager. As such, he was and is the commercial lending officer of the claimant bank, a post he has filled since September 1987. Mr. Roberts is employed as General Manager of a Cayman Catering Services providing In-Flight services for airlines calling at the Cayman International Airport. He visits his wife and home in Antigua frequently. Mrs. Roberts is a housewife, real estate agent and businesswoman, with her own property rental business known as Coral Properties at St John's in Antigua. She has no formal business qualification.

5 In April 1997, Mrs. Roberts was approached by one Murrio Ducille (hereinafter “Mr. Ducille”) and invited to purchase the Crosbies Property from Mr. Ducille and his wife (hereinafter together referred to as “the Ducilles”) as an investment for her family. Mr. Ducille was a Jamaican national who at the time was the Senior Magistrate of Antigua and Barbuda. His wife was also a prominent officer in the government service. At some point, Mr. Ducille told Mrs. Roberts, as she claimed, that he had arranged for her to visit the claimant bank for the purpose of obtaining financing for the purchase. Mr. Christian in his testimony denied that he had arranged anything with Mr. Ducille, and Mr. Ducille has returned to Jamaica and was not here to speak for himself. Mrs. Roberts visited the claimant bank during April 1997 and discussed with Mr. Christian the possibility of her and Mr. Roberts taking a loan for the purpose of purchasing the Crosbies Property from the Ducilles. The defendants were previous borrowing customers of the claimant bank. They had earlier made loans from the claimant bank, and had given the bank charges over their Paradise View Property. For example, on 28 March 1996 the claimant bank had refinanced the defendants' mortgage in the sum of $115,000.00 and had taken a charge over the Paradise View Property. Then, on 10 September 1996 the defendants had borrowed $55,000.00 to finance the education of one of their children, and had given the claimant bank a second charge over the Paradise View Property. This second Charge Instrument contained a consolidation clause, referring to the right of the claimant bank to consolidate this charge with the earlier one. These charges had, as appears from the endorsements on the back of the instruments, been prepared by the claimant bank's own solicitors, and one can expect that the defendants paid the normal Bank's Solicitor's fees for preparing and processing the Charge Instrument.

6 At the time of the proposed purchase of the Crosbies Property, according to the “Cash Budget,” “Site Analysis,” and “Market Analysis” presented by Mrs. Roberts to the claimant bank and dated 24 April 1997, the property consisted of 7 apartment units on two lots of land, Parcels 73 and 74. The selling price was $3,100,000.00. The Crosbies area was, in Mrs. Roberts' view, a desirable and highly sought after suburb of St John's, with a variety of hotels, apartment complexes, gourmet restaurants and sporting facilities in the environs. The buildings on the property were less than one year old, and Mrs. Roberts thought that the complex had “competitive capabilities and marketability.” She planned to rent five of the two-bedroom units short-term and the three-bedroom unit long term. She projected rental income of over $600,000.00 in each of the first three years, permitting easy re-payment of the loan repayment instalments of $30,000.00 per month or $360,000.00 per year. She persuaded her husband that this was a good investment, and he agreed that she should complete the negotiations on behalf of the two of them. Mrs. Roberts applied for full financing from the claimant bank in the amount of $3,100,000.00, but the Head Office of the claimant bank in Barbados rejected the application. Head Office requested that the defendants put in equity of at least $200,000.00 before it would consider the loan. This was communicated to Mr. Christian, who testified that he had explained the requirement to Mrs. Roberts. Mrs. Roberts testified that Mr. Christian had never told her anything of this requirement for a cash injection, and that he had done all the negotiating for the loan and the security documents directly with Mr. Ducille. The evidence is that the Ducilles agreed to make a loan to the defendants of $200,000.00, thus reducing the amount of cash required immediately for the purchase to $2,900,000.00. On this basis, Head Office agreed to make the loan, and Mr. Christian was authorised to make an offer to the defendants of a Credit Facility in the reduced amount. This offer was duly made on 16 June 1997. It is contained in a letter of that date from the claimant bank to the defendants, and required one of their signatures to be put on the letter to confirm acceptance. Mrs. Roberts did this the following day, on 17 June 1997. It is this letter that the defendants seek to have the Court find is the only Loan Agreement...