Post on 19-Feb-2018
/ BERMUDA
/ BRITISH VIRGIN ISLANDS
/ CAYMAN ISLANDS
MARCH 2015 – JUNE 2015
ISSUE NO. 10
BERMUDA BRITISH VIRGIN ISLANDS CAYMAN ISLANDS DUBAI HONG KONG LONDON MAURITIUS SINGAPORE / conyersdill.com
OFFSHORE CASE DIGEST
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/ Editor Bermuda Christian R. Luthi / Assistant Editor Bermuda Stephanie Hanson / Contributors Bermuda Ben Adamson Scott Pearman British Virgin Islands Tameka Davis Cayman Islands Paul Smith Erik Bodden Hong Kong Nigel K. Meeson, QC Norman Hau
About Conyers Dill & PearmanFounded in 1928, Conyers Dill & Pearman is an international law firm advising on the laws of Bermuda, the British Virgin Islands, the Cayman Islands and Mauritius. With a global network that includes 140 lawyers spanning eight offices worldwide, Conyers provides responsive, sophisticated, solution-driven legal advice to clients seeking specialised expertise on corporate and commercial, litigation, restructuring and insolvency, and trust and private client matters. Conyers is affiliated with the Codan group of companies, which provide a range of trust, corporate secretarial, accounting and management services.
This update is not intended to be a substitute for legal advice or a legal opinion.
It deals in broad terms only and is intended to merely provide a brief overview
and give general information.
BERMUDA | BRITISH VIRGIN ISLANDS | CAYMAN ISLANDS
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This update is not intended to be a substitute for legal advice or a legal opinion.
It deals in broad terms only and is intended to merely provide a brief overview
and give general information.
3 / conyersdill.com
The Offshore Case Digest offers readers a high level summary of the major commercial cases decided in Bermuda, the British Virgin Islands and the Cayman Islands between March 2015 and June 2015. Our goal is to provide a useful reference tool for clients and practitioners who are interested in the development of case law in each jurisdiction.
ABOUT THE DIGEST
We would welcome any feedback and suggestions from readers on the content. If you would like to obtain further information on any of the cases feel free to contact any of the Conyers Dill & Pearman litigation team.
JURISDICTION PAGE
Bermuda 2
British Virgin Islands 7
Cayman Islands 9
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Bermuda
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SUPREME COURT
TRUSTS (SPECIAL PROVISIONS) ACT, 1989 – BEDDOE RELIEF – NON CHARITABLE PURPOSE TRUST – INDEMNITY – DEFENCE BY TRUSTEES
Trustee L and Others –v– The Attorney General and Others [2015] SC (Bda) 41 Com (15 May 2015)
The Plaintiffs are the Trustees (the “Trustees”) of certain Bermuda
Purpose Trusts (the “Trusts”) established under the Trusts (Special
Provisions) Act, 1989 (the “1989 Act”). This was a ruling on the Plaintiffs’
application for Beddoe relief with respect to proceedings (the “Main
Action”) brought against them by the Second Defendant (“D2”).
The application was novel in two respects: (i) so far as the Court or
Counsel were aware this was the first time that Beddoe relief has been
sought by the Trustees of a non-charitable purpose trust, albeit the
purposes of the trusts in question did include some charitable
purposes and (ii) there has not previously been a claim made to trust
assets of such high value as those with which the present case is
concerned without any beneficiaries to defend the Claim.
The total value of the Trust assets was large with a substantial part of
those assets consisting of shares in a group of companies (the
“Companies”) founded by S and T. Both men were deceased. The
Directors of the Trustees included Child 1 and Child 2, who were
children of S and T. D2 sued in its proposed capacity as administrator in
Bermuda of S’s estate; in D2’s capacity as one of the heirs of S (and
purportedly on behalf of all the heirs). D2’s primary case in the Main
Action was that all the Trusts were void, or alternatively that the
transfers of assets into the Trusts should be set aside, and that the
assets form part of the estate.
The primary issue arising on the Beddoe application was whether the
Trustees should defend D2’s primary case in the Main Action and have
an indemnity in respect of their costs of doing so. In considering the
issue, the Judge attached particular importance to the absence of any
person with a real interest in defending the claims and the fact that
there were sufficient prospects of success to warrant the Trustees in
defending them. The Judge was satisfied that these factors
outweighed the risk of injustice to D2 and the other heirs, should D2
prevail in the Main Action. As such, the Judge was satisfied that the
Trustees should, if so advised, defend D2’s primary case in the Main
Action and granted an indemnity from the Trust assets for that
purpose.
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RULING ON COSTS – THE EVIDENCE ACT, 1905 (AS AMENDED) – ORDER 70 OF THE RULES OF THE SUPREME COURT, 1985
The Patriot Group, LLC –v– Hilco Financial, LLC N/K/A 1310 Financial, LLC & Others [2015] SC (Bda) 38 Com (23 June 2015)
This hearing was listed to determine how to deal with the costs arising
from a prior judgment in which the Court refused the Applicant
witness’ application to set aside an, ex parte, Order for her
examination; an order that had been made without a hearing. While
the Judge had found that the Order, as originally granted, was liable to
be set aside on various grounds including material non-disclosure,
these irregularities occurred in part because the application was
prepared and prosecuted as if it was a non-opposed application when
in fact the witness had not previously been contacted. In light of the
fact that the Respondents had subsequently: (a) offered to vary the
Order by including conditions in relation to the proposed examination
and (b) on or about 7 November 2014 filed an affidavit which fortified
the strength of the merits of the original application and to save costs,
the Judge exercised his discretion in favour of varying the Order rather
than setting it aside. The Applicant also achieved some marginal
outcome of success in terms of broadening the scope of the
examination conditions, which the Respondents had previously
offered prior to the hearing.
The Respondents sought to persuade the Court that since they had
substantially succeeded on the application to set aside, and were
willing to concede that they should pay the Applicant’s costs up to 7
November 2014, the Applicant should be required to pay the costs of
the application to set aside. The standard rule that costs should follow
the event, having regard to which party had succeeded in ‘real-life’
terms was relied upon: Binns –v– Burrows [2012] Bda LR 3 (at
Paragraph 5) and Kentucky Fried Chicken (Bermuda) Ltd. –v– Minister
of Economy [2013] Bda LR 34 (at Paragraph 14).
The Applicant contended that the Applicant should be awarded her
costs and in any event not be required to pay the Respondents’ costs.
It was submitted that the position of a non-party witness engaged
distinctive costs rules according to which the starting assumption was
that where evidence was being sought from a non-party, that party is
entitled to their costs. The Applicant relied on the authority of
Paragraph 46.1 of the Civil Procedure Rules, 2000 (“CPR”)
The Judge agreed with the Respondents’ submission that the
ordinary rules as to costs apply. In doing so the Judge declined to
follow by analogy the practice under Rule 46.1 of the CPR on the
grounds that the type of application it dealt with was not analogous.
In the exercise of the Court’s discretion, the Judge ordered the
Respondent to pay the Applicant’s costs of responding to and
applying to set aside the, ex parte, Order up until 7 November 2014.
The Judge held that prior to that date, it was inconceivable that the
application to set aside would not have succeeded both on the merits
and in the result. After that date the Judge found that the parties
ought to have been content to negotiate a consensual variation of
the, ex parte, Order in terms which were, at that point, substantially
agreed.
EX TEMPORE RULING ON COSTS – COSTS FOLLOW THE EVENT – REAL WORLD SUCCESS OF CLAIM – CONSIDERATION OF THE BACKGROUND TO THE LITIGATION
David R. Whiting –v– Torus Insurance (Bermuda) Limited [2015] SC (Bda) 17 Civ (6 March 2015)
In this matter the Plaintiff, was awarded US$1909 out of a Claim for
wrongful dismissal that was potentially worth just over US$300,000.
The Plaintiff sought costs on the usual ‘costs follow the event’ basis.
The Defendant contended that having regard to the ‘infinitesimal’
financial success that the Plaintiff achieved, the appropriate order
should be no order as to costs.
In the present case the Judge accepted that the starting assumption
must be that the Plaintiff should be entitled to his costs. But, having
regard to the authorities cited and looking at the huge disparity
between the amount awarded and the amount originally claimed,
stated that the Court was bound to find that in ‘real world’ terms the
Plaintiff had not succeeded because this case was quintessentially a
claim about money.
The only question to consider was, to what extent the Court should
award the Plaintiff any costs at all. In this regard, the Judge outlined
that it was the Court’s duty to look at the background to the litigation
to see how the litigation should have been conducted. In doing so the
Judge held that from 13 June 2014 when the Defence was filed, it
would not be reasonable for the Court to exercise its discretion to
award the Plaintiff any costs.
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TRUSTS – COURT’S FUNCTION IN APPROVING EXERCISE OF TRUSTEE’S DISCRETION – DOES REGARD NEED TO BE GIVEN TO WIDER SOCIAL EFFECTS OF PROPOSED SETTLEMENT
In The Matter Of ABC Trusts [2015] SC (Bda) 29 Civ (10 September 2014)
On 18 August 2014, the Judge approved a decision of the Trustees to
proceed to conclude negotiations commenced some years ago with
the onshore tax authorities about certain personal ‘wealth’ taxes
which were potentially due from the Trusts and/or the Beneficiaries.
The contested application by the Trustees for further directions in
relation to the approval sought, raised legal questions which are likely
to be relevant in future cases and therefore, the Judge provided
reasons for the same.
Court’s function in approving proposed exercise of Trustees’ discretion
The fifth Defendant in this matter sought to argue that: (a) the Trustees’
application involved a surrender of their discretion to the Court, (b) the
Court should accordingly be put in possession of all material relevant to
the exercise of that discretion and (c) the Court’s function is solely to
determine what ought to be done in the best interests of the estate.
The first two limbs of that submission were controversial.
The Judge did not accept that the Court was compelled to find that in
seeking the directions which the Trustees sought, they were surrendering
their discretion to the Court. Instead, the application was more properly
characterised as seeking the blessing of the Court for a momentous
decision.
Were the Trustees required to have regard to the wider social effects of the proposed settlement and to interests other than those of the Beneficiaries?
The Trustees in the present case effectively conceded that it was
consistent with the commercial interests of both the Trust and the
Trustees to avoid a situation where the Trustees and/or the Beneficiaries
could be fairly accused of manifesting a socially irresponsible attitude to
the payment of onshore taxes which were properly due. That was the
driving motivation behind initiating the negotiations, which have resulted
in the proposed settlement. The Trustees’ definition of the content and
scope of their duties in this regard was entirely consistent with the
Judge’s extra-judicial opinion in that:
“…it is simplistic to imply that offshore commercial law operates in an
ethically deprived legal zone... Bermudian offshore structures are formed
in and regulated by a legal framework which aims to…ensure compliance
with internationally recognised standards of commercial morality.”
(See Offshore Commercial Law in Bermuda (Wildy Simmonds & Hill:
London, 2013), Paragraphs 1.64, 1.69)
Applying the above principles to the facts of the present case, the Judge found that in all the circumstances:
1. it would be an unreasonable way of expending trust assets to
investigate the need to pay a further premium to ward off the
risk of wholly unjustified criticism of a tax settlement which was:
(i) manifestly hard-fought and negotiated on objectively
credible terms and (ii) negotiated in circumstances where there
appeared to be no obvious inequality of arms between the
well-resourced Trustee and Beneficiary team and an apparently
well-resourced revenue authority team working on behalf of a
stable and sophisticated State;
2. the Trustees’ decision to pursue the negotiations to their
conclusion was based on their genuinely formed view that this
course is consistent with the best interests of the Trusts and
their Beneficiaries as a whole;
3. the said view was one which a reasonable body of Trustees
could properly have arrived at;
4. the Trustees had no actual or potential conflicts of interest and
5. the Trustees had placed before the Court sufficient relevant
information to support the findings in (1) to (3) above, without
the need for any further enquiry.
COURT OF APPEAL
INTERNATIONAL COOPERATION (TAX INFORMATION EXCHANGE AGREEMENTS) ACT, 2005 (THE “ACT”) – DISCLOSURE OF DOCUMENTS PLACED BEFORE THE COURT
The Minister of Finance –v– AD [2015] CA (Bda) 18 Civ (12 June 2015)
This was an appeal of an earlier ruling by Hellman J ordering the
Minister of Finance to disclose documents which were placed before
the Judge in support of an, ex parte, application for a Production
Order. Prior to the hearing the Minister voluntarily disclosed the
documents, however due to the importance of the decision to other
pending and anticipated cases the Minister wished to continue with
the appeal. AD was not represented but the Court was assisted by the
submissions of the amicus curiae.
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Kay JA gave the Judgment of the Court, dismissing the appeal and
upholding the decision at first instance. The appeal was essentially
based on the submissions that the words used in the Act were clear
and unambiguous, that the relevant subsection (Section 5(6A)) was
intended to prevent fishing expeditions, which the Judge ought to
have found were commonplace, and that the Judge erred in finding
that the subsection related to redacted information.
The Court of Appeal confirmed the Judge’s findings that the right to
disclosure is a fundamental principle of fairness at common law and
that any abrogation from this right requires legislation that is “crystal
clear”. The argument that the wording of the Act was a clear and
unambiguous abrogation was rejected. The Court of Appeal also
found that there was no evidence of fishing expeditions being
commonplace; conversely, the Court was willing to accept that the
requests for disclosure did not impose a significant burden on the
Minister.
The Court was willing to find that the requirement for disclosure was
limited to those documents placed before the Court, and did not
apply to information about oral statements or documents not
exhibited but expressly referred to.
The Court held that the change in procedure from an executive
decision (subject to judicial review) to an originating judicial process
necessarily carried with it the fundamental right of disclosure.
In a further ‘swing-and-a-miss’ the Minister sought to argue that the
decision at first instance resulted in Bermuda being in breach of the
confidentiality obligations imposed by Article 8 of the OECD
Agreement on Exchange of Information on Tax Matters. The Court
noted the exception for information being disclosed in court
proceedings and judicial decisions, contained in Article 8 itself, and
rejected the argument.
RSC ORDER 45 – BERMUDA INTERNATIONAL CONCILIATION AND ARBITRATION ACT, 1993 (THE “1993 ACT”) – APPEAL AGAINST REFUSAL OF STAY OF ENFORCEMENT
Laep Investments Ltd –v– Emerging Markets Special Situations 3 Ltd. [2015] CA (BDA) 10 Civ (9 April 2015)
On 18 March 2013 the Respondent, Emerging Markets Special
Situations 3 Ltd. (“EMSS”) obtained an arbitration award in Brazil
against the Appellant company (Laep Investments Ltd (the
“Company”)). EMSS then quickly proceeded to obtain an
Enforcement Order and a Worldwide Freezing Order in quick
succession in Bermuda.
The Company unsuccessfully sought an Annulment of the arbitration
award in Brazil, and EMSS went on to serve a Statutory Demand in
Bermuda. The application for an annulment was successfully
appealed and remitted back for a rehearing. EMSS then issued a
petition to wind up, the Company having failed to satisfy the
Statutory Demand, in response to which the Company served a
summons seeking the dismissal of the petition.
Meanwhile in Brazil, the Company unsuccessfully sought a stay of the
arbitration award pending the outcome of the annulment application,
however the application was successful on appeal and an interim stay
was granted on 19 December 2013.
Shortly before the hearing of the application to dismiss the winding
up petition, the Company also issued an application seeking a stay of
the Enforcement Order pursuant to RCS Order 45 Rule 11, which
states that the Court may order a stay of execution of a Judgment or
Order on the ground of matters which have occurred since the date
of the Judgment.
On 1 April 2014 the Supreme Court dismissed the application to stay
the Enforcement Order and dismissed the application to dismiss the
winding up petition. The Company appealed.
The Company submitted that the temporary stay was a matter that
had taken place since the Enforcement Order and that the Judge at
first instance had erred in considering guidance under Part 52 of the
2014 White Book, which is applicable to a stay pending appeal. In
addition, the Court at first instance had erroneously considered
Section 42(5) of the 1993 Act rather than Section 42(2)(f), the former
dealing with circumstances where an application to suspend has been
made but not yet determined (here there was an order granting a
stay, albeit an interim order).
The Court of Appeal agreed that the Judge appeared to have
concentrated on the prospects of success of the annulment
application, rather than the manner in which the application for
enforcement would or might have been decided in light of the
suspension of the Award.
The Judge fell into error when he appeared to consider the principles
applicable to the grant of a stay in the context of an application
following Judgment and pending the outcome of an appeal. He
similarly fell into error when he considered Section 42(5) rather than
Section 42(2)(f). The Court of Appeal found that the case law referred
to by the Judge did not assist in relation to Section 42(2)(f). The test
applied under Section 42(5) (being a consideration of the prospects
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of success) was inappropriate in relation to Section 42(2)(f). In
particular, the Court held that the Judge was wrong to refer to the
absence of material before him, which might outweigh the bias
towards enforcement inherent in the 1993 Act.
Essentially, the Court of Appeal held that the Judge failed to
appreciate the nature of the Brazilian Stay Order, which led him to
consider the wrong part of the 1993 Act. This led to him failing to find
that there could be no question of the Court allowing enforcement in
respect of an award, which was subject to a stay in the country where
it had been made. The Court went on to find that this
misunderstanding and misapplication of the law entitled the Court to
exercise an original discretion in favour of the Appellant.
The Court went on to find that the Judge was correct in his refusal to
dismiss the winding up petition, in spite of a finding that the Judge’s
rejection of the various grounds of opposition to the winding up
petition were very much influenced by his findings in regards to
enforcement. However, as he had erred in his discretion regarding the
stay of enforcement, the issue ought not to have arisen.
The Court of Appeal therefore granted a stay of the Enforcement
Order and set aside the Order to wind up the Company.
INTERPRETATION OF CONTRACTS – SHARE REPURCHASE AGREEMENTS
Aircare Limited –v– Wyatt Sellyeh [2015] CA (BDA) 6 Civ (20 March 2015)
The Appeal concerned the construction of a provision in a share
repurchase agreement (the “Agreement”) whereby Aircare Limited
(“Aircare”) agreed to repurchase shares from, inter alia, Mr. Sellyeh. The
shares were to be purchased in four tranches. The first of those
tranches would take place at a time when there were no audited
accounts, and so there was a provision in the Agreement for
recalculation by a specified formula of the purchase price of the first
tranche.
Aircare paid Mr. Sellyah the agreed purchase price. Upon the
recalculation, the new purchase price was less than the initial price and
so Aircare sought judgment in the sum of the difference. The Judge at
first instance held that there were two meanings to the relevant clause.
He went on to agree with Mr. Sellyeh that the correct interpretation of
the Agreement was that the initial price was a minimum price. The
claim by Aircare was accordingly dismissed.
Aircare sought to argue that the Judge was correct to find that this
was a case where the contractual term had two meanings, but that
business common sense compelled an interpretation of the Agreement
which permitted an upward and downward recalculation. Mr.. Sellyeh
submitted that the relevant clause was unambiguous and provided for
upward recalculation only, and even if the Judge was correct in finding
that the clause was capable of two meanings, business common sense
still resulted in the clause providing for upwards recalculation only.
The Court of Appeal referred to the well-known speech of Lord
Hoffman in Investors Compensation Scheme Ltd –v– West Bromwich
Building Society and the principles propounded therein for the
interpretation of contracts.
The Court was sympathetic to the Appellant’s argument that following
a finding of two meanings, it was necessary to consider which meaning
was more reflective of business common sense, whereas the Judge
reverted to a close consideration of the language. However, the Court
considered and agreed with the Respondent’s assertion that this was in
fact a clause that plainly had one meaning.
The Court went further and found that even if the clause was
susceptible to two interpretations, business common sense fell in
favour of the Respondent’s interpretation. The appeal was therefore
dismissed.
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British Virgin Islands
BRITISH VIRGIN ISLANDS
COURT OF APPEAL
CIVIL APPEAL – WHETHER LEARNED MASTER ERRED IN REFUSING TO SET ASIDE DEFAULT JUDGMENT – WHETHER LEARNED MASTER ERRED IN THE EXERCISE OF DISCRETION
Yates Associates Construction Co Ltd –v– Brian Quammie BVIHCAP2014/0005 (May 2015)
In this appeal Yates Associates Construction Co Ltd (the “Appellant”),
sought to appeal the decision of the Learned Master to refuse to set
aside the default Judgment entered against it.
In the Court below, the Appellant relied on inadvertence as the reason
for its failure to file its defence in time. In dismissing the Appeal the
Court of Appeal held, inter alia, that a court may set aside a default
judgment entered under Part 12 of the Civil Procedure Rules, 2000
only if certain requirements were met, one such requirement was the
need to provide the Court with a good explanation for the failure to
file an acknowledgment of service or a defence.
The Court held applying the Privy Council’s decision in the Attorney
General –v– Universal Projects Limited [2011] UKPC that where the
explanation for the failure to file a defence or acknowledgment of
service connoted real or substantial fault on the part of the defendant,
then that could not be a good explanation for the failure and while
oversight may be excusable in certain circumstances oversight which
included administrative inefficiencies was inexcusable and would not
amount to a good explanation (John Cecil Rose –v– Anne Marie Uralis
Rose SLUHCVAP2003/0019 followed).
INTERLOCUTORY APPEAL – ASSESSMENT OF COSTS – RULE 65.12 OF THE CIVIL PROCEDURE RULES, 2000 – WHETHER LEARNED MASTER ERRED IN ASSESSING COSTS WHERE THERE WAS NO ADEQUATE MATERIAL OR ITEMISED BILL OF COSTS – WHETHER LEARNED MASTER ERRED IN APPLYING ENGLISH HIGH COURT CASE TO ASSESSMENT OF COSTS UNDER CPR 65.12 – WHETHER LEARNED MASTER ERRED IN AWARDING REFRESHER FEES TO COUNSEL
Dawn Emberson Bain –v– Tortola Investment Trust Limited BVIHCVAP 2014/001 (May 2015)
This Appeal arose out of the decision of the Learned Master to assess
costs, although the bill of costs was found to be deficient, and to do
so, based on the test formulated in the English High Court case of
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Simpsons Motors Sales (London) Ltd. –v– Hendon Corporation (No 2).
Allowing the Appeal the Court of Appeal held that Rule 65.12 of the
Civil Procedure Rules, 2000 (“CPR”) required that an application for
assessment of costs must be accompanied by a bill of costs or other
document showing the sum in which the Court is being asked to
assess the costs and how such sum was calculated. The Learned
Master, having found that the bill of costs was deficient, should have
complied with CPR 65.12(5) and not assessed the costs, but fixed a
date, time and place for the assessment to have taken place and by
failing to do so the Learned Master was wrong to exercise his
discretion and to assess costs.
The Court also held that the test formulated in the English High Court
case of Simpsons Motor Sales (London) Ltd. –v– Hendon Corporation
(No. 2) was based on the application of Rule 28(2) of the English
Supreme Court Costs Rules, 1959 which was dissimilar to CPR 65.12
and 65.2. Thus by assessing costs using the test laid down by the
English High Court in the Simpson case the Court of Appeal held that
the master was wrong in law.
INTERLOCUTORY APPEAL – DEALING WITH FIXED DATE CLAIM SUMMARILY RULE 27.2(3) OF THE CIVIL PROCEDURE RULES, 2000 – APPELLANT’S DEFENCE STRUCK OUT BY LEARNED JUDGE IN COURT BELOW AND FIRST HEARING OF CLAIM TREATED AS TRIAL AND/OR MATTER DEALT WITH SUMMARILY – NO EVIDENCE RECEIVED FROM OR ON BEHALF OF RESPONDENT/CLAIMANT BY JUDGE IN DEALING WITH CLAIM AND JUDGMENT ULTIMATELY ENTERED FOR RESPONDENT/CLAIMANT – WHETHER LEARNED JUDGE ERRED IN ADJUDICATING CLAIM IN THIS MANNER
Travis Augustin –v– Choc Estates Limited SLUHCVAP 2014/0002 (June 2015)
This Appeal was against an Order made by Wilkinson J wherein the
Learned Judge ordered, inter alia, that the defence should be struck
out and Judgment entered for the Claimant. Following the case of
Richard Frederick et al –v– Comptroller of Customs et al
SLUHCVAP2008/0037, the Court of Appeal allowed the appeal and
held that having decided to treat the first hearing of the fixed date
claim as a trial after striking out the Appellant’s defence, the Learned
Judge was obliged to receive evidence from the Claimant whether
orally or on affidavit.
Notwithstanding that the Claim was being dealt with summarily, the
Court held that the Claimant must prove that he/she was entitled to
the relief being sought and that a trial must be conducted, albeit in a
summary way. As a result the Court of Appeal found that the Learned
Judge erred by proceeding to adjudicate the Claim in favour of the
Claimant without receiving evidence.
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Cayman Islands
CAYMAN ISLANDS
GRAND COURT
THIRD PARTY COSTS ORDER – COSTS AGAINST NON-PARTIES TO PROCEEDINGS
In the matter of VC Computer Holdings (in official liquidation), FSD 63/2014, per Jones J (17 April 2015)
The Applicant sought Orders for Luis Filipe DaCosta De Souza
Azevedo (“Mr. Azevedo”) and Mertal Overseas SA (“Mertal SA”) to be
held jointly and severally liable for the costs of winding up VC
Computer Holdings Limited (the “Company”). Mertal SA, a special
purpose company incorporated in the British Virgin Islands, was the
sole shareholder of the Company. Mr. Azevedo, the ultimate beneficial
owner of Mertal SA, was the ultimate beneficial owner of Mertal SA
and the Company.
As a general rule, costs incurred by a person who successfully
presents a creditor’s winding up petition will be paid out of the assets
of such company. However, in exceptional circumstances Courts may
make an order against a non-party to the proceedings. Specifically, in
the current case, the Court had discretion to make orders: (1) against
Mertal SA due to the fact that the Company chose to participate in the
proceedings and to defend the petition in its capacity as the
Company’s sole shareholder and (2) against Mr. Azevedo, even though
he did not make himself a party to the proceedings, under Section
24(3) of the Judicature Law which provides the Court discretion to
determine by whom and to what extent the costs of proceedings are
to be paid.
In determining whether Mertal SA and Mr. Azevedo should be held
jointly and severally liable for the costs of winding up the Company,
the Court followed the principles set out in the New Zealand Privy
Council case of Dymocks Franchise Systems (NSW) Pty Ltd –v– Todd
[2004] 1 WLR 2807, which provided guidance on when the Court
could use its discretion to make an Order against a non-party to
proceedings. In particular, it was held that:
1. Generally speaking the discretion will not be exercised against
“pure funders”, namely “those with no personal interest in
litigation, who do not stand to benefit from it, are not funding it
as a matter of business, and in no way seek to control its course
giving priority to the public interest in a funded party getting
access to justice.”
2. Where, the non-party not merely funds the proceedings but
substantially also controls or at any rate is to benefit from
them, justice will ordinarily require that, if the proceedings fail,
he will pay the successful party’s costs. The non-party in these
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cases is not so much facilitating access to justice by the party
funded as himself gaining access to justice for his own
purposes. He himself is “the real party” to the litigation.
In applying the above principles to the facts of the case, the Court
ultimately concluded that there were exceptional circumstances and
accordingly exercised its discretion against Mertal SA and Mr.
Azevedo. In particular, the Court found that it was just to make Orders
against Mertal SA and Mr. Azevedo as: (1) Mr. Azevedo conducted the
defence of the petition in his own interest (essentially, the only
interested parties were Mr. Azevedo and the petitioner); (2) the Court
found that Mr. Azevedo’s defence of the petition was conducted in an
improper manner (Mr. Azevedo put forward three different and
inconsistent defences) and (3) Mr. Azevedo consistently failed to
comply with Orders for directions, which led to multiple interlocutory
applications, which ultimately led to increased expenses and delays.
Although the ultimate beneficial owner of the Company was not held
fully liable for the debts of the Company, it does show that in
questions of costs the Courts are willing to look behind the corporate
veil to hold Mr. Azevedo accountable as he had acted solely in his own
interest as the sole beneficial owner of the Company to the detriment
of the creditors.
REDEMPTION OF SHARES – RECTIFICATION OF THE REGISTER OF MEMBERS – SECTION 37(7) OF THE COMPANIES LAW – UNDER SECTION 112 OF THE COMPANIES LAW
Primeo Fund (in official liquidation) –v– Herald Fund SPC (in official liquidation), FSD 27/2013, per Jones J (12 June 2015)
This case concerned Herald Fund SPC (In Official Liquidation) (“Herald”),
which was an open-ended investment fund, which was incorporated on
24 March 2004. Herald invested the majority of its funds in the Bernard
L. Madoff Investment Securities LLC (“BLMIS”). The Primeo Fund (In
Official Liquidation) (“Primeo”) was incorporated on 18 November 1993
and also carried on business as an open-ended investment fund. Primeo
initially placed funds for investment directly with BLMIS in 1993 but, from
2004 onwards, it invested in Herald which resulted in it becoming an
indirect victim of the Madoff Ponzi scheme.
The above proceedings concerned an application that certain issues
involved the liquidation of Herald (which included an additional liquidator
(the “Additional Liquidator”) acting as Herald’s representative) and
Primeo be resolved through the direction of the Court. Primeo was
placed into voluntary liquidation on 23 January 2009 and its liquidation
was brought under the supervision of the Court on 8 April 2009. Herald
had suspended the calculation of its net asset value (the “NAV”) and the
issue and redemption of shares on 12 December 2008 (the day after the
revelation of the Madoff fraud) but remained under the control of its
Directors until 23 July 2013 when a winding up order was made on the
petition of Primeo.
The first issue in question was whether Section 37(7)(a) of the
Companies Law applies in relation to the Participating Non-Voting
Shares, which form the subject of redemption requests submitted to
Herald by various shareholders in December 2008 (the “December
Redeemers”). HSBC Securities Services (Luxembourg) SA (“HSSL”),
acting on behalf of Herald in its capacity as administrator, received
requests from the December Redeemers requesting the redemption of
Participating Non-Voting Shares (the “December Redeemer Shares”) for
a redemption day of 1 December 2008. On or about June 2011, HSSL
acting for, and on behalf of, Herald sent the December Redeemers
confirmation that their shares had in fact been redeemed. One of the
December Redeemers ultimately was paid prior to the suspension of
trading on 12 December 2008 (as a result of Madoff’s confession of his
fraud on 11 December 2008) whilst the others were not.
The Court considered Section 37(7) of the Companies Law issue
regarding the redemption of shares. In Culross Global SPC Limited –v–
Strategic Turnaround Partnership Limited (2000) 23 CILR 364, it was
indicated that the question of when shares are redeemed is a question
not only for the Companies Law but also for the relevant company’s
articles of association. On the basis of the facts, this was non-contentious
and it was clear that the December Redeemers had redeemed their
shares in accordance with the Company’s articles of association. In that
case, it was determined that the plaintiff shareholder had in fact served a
valid redemption request before the suspension of trading. The Privy
Council held that the power to suspend the redemption process did not
apply to the Plaintiff in question as the redemption had already taken
place. Similarly in RMF Market Neutral Strategies (Master) Limited –v– DD
Growth Premium 2X Fund (Unreported, 17 November 2014), the Chief
Justice concluded that the effect of the articles was that upon service of
a valid redemption notice, the shares in question ceased to be
outstanding on the relevant valuation day, whereupon the shareholder
became a creditor in respect of the redemption proceeds. Jones J held in
favour of Primeo.
11
CAYMAN ISLANDS
In addition to the issue of redemption, the Court also considered the
matter of rectification of the register of members. In particular, the
Courts considered whether: (a) the NAVs determined pursuant to the
articles of association during the period from 24 March 2004 (being the
date of its incorporation) to 10 December 2008 (being the date
immediately before the revelation of the Madoff fraud) in respect of each
class of Participating Non-Voting Shares issued by Herald were not
binding on Herald by reason of ‘fraud or default’ within the meaning of
Section 112 of the Companies Law and Order 12, Rule 2 of the Companies
Winding Up Rules and (b) Section 112 of the Companies Law and Order
12, Rule 2 of the Companies Winding Up Rules applied so as to empower
the Additional Liquidator of Herald to rectify its register of members.
Section 112(2) of the Companies Law empowers an official liquidator to
rectify the register of members in the case of a solvent liquidation of a
company, which has issued redeemable shares at prices based upon its
NAV from time to time. Jones J reasonded that for the NAVs not to be
binding between the company and its members, there must be some
conduct on the part of the company or its agent, which has the effect of
vitiating the company/member contract. Further, he reasoned that the
mere fact that Herald’s NAVs were negatively affected by the BLMIS
scandal would not be sufficient to vitiate the contract (see Fairfield
Sentry Ltd –v– Migani [2014] UKPC 9). Furthermore, Jones J held:
“I think that it is highly improbable that Rule 2 was intended to
operate in a way which would make the determination of a company’s
NAV open to challenge whenever it could be said, with the benefit of
hindsight, that it had been mis-stated by reason of the fraud or default
in some way which would not have the effect of vitiating the contract”.
The key issue is when the Additional Liquidator should use this power
under Section 112 of the Companies Law and what methodology
should be used by the Additional Liquidator to determine how the
rectification of the register of members should take place. Jones J
ultimately adjourned this question until the next hearing.
JUDGMENT ON COSTS – COSTS THROWN AWAY AND OCCASIONED ON PLAINTIFF’S AMMENDMENT TO STATEMENT OF CLAIM – COSTS OF AND THROWN AWAY BY ABANDONED CLAIMS IN DECEIT – INTERIM PAYMENT ON ACCOUNT PENDING TAXATION
Weavering Macro Fixed Income Fund Limited (In Official Liquidation) –v– Ernst and Young Chartered Accounts (a Firm) and Others (5 May 2015)
The Judgment concentrated on three key issues relating to costs: (i)
costs thrown away and occasioned by amendments to the Plaintiff’s
statement of claim; (ii) costs thrown away by the abandoned claims in
deceit and (iii) an invitation for the Court to exercise its discretion and
to award an interim payment on account pending taxation.
On the first issue the Court took guidance from Order 20 Rule 8 of the
Supreme Court Practice, 1999 where Paragraph 20/8/52 states that:
“The usual penalty imposed on a term for giving leave to amend is that
the party seeking the amendment should pay in any event all the costs
incurred and thrown away by the amendment and the costs of any
consequential amendment”.
The Defendants argued that the Plaintiff should pay costs of and
occasioned by preparing, issuing and serving of the summons. Justice
Quin ordered that the Plaintiff pay the costs of, thrown away and
occasioned by the amendments to its amended statement of claim up
to and including the first day of the hearing (10 February 2015) in any
event and further that these costs be taxed on the standard basis if
not agreed.
The Defendants’ second submission related to costs thrown away by
abandoned claims in deceit against Ms. Allen and Mr. Barber. They
argued that the costs should be paid by the Plaintiff in any event and
further that these costs should be assessed on an indemnity basis. The
Plaintiff took the position that the claim in deceit in relation to the
2006 audit would continue and the claim in negligence in relation to
the 2007 audit would continue but the deceit claim be abandoned. As
a result, the Plaintiff submitted that they could not say that none of
the costs incurred in relation to the original case were of no value to
the amended case, but also that the Defendants could not say that all
the costs incurred in relation to the original case were of no value to
the amended case and therefore useless.
Justice Quin agreed that there must be a high degree of overlap
between the work done in relation to the withdrawn allegations and
the work which will be necessary for the Claim as amended, however,
separating what work would be of value would be incredibly difficult.
Furthermore, Justice Quin believed this exercise would be unjust to
both parties due to the time and expense involved. The Defendants’
followed the position as in Sagicor General Insurance (Cayman) Ltd.
–v– Corporate Adjusters (Cayman) Ltd. [2008] CILR 482, contending
12
CAYMAN ISLANDS
that an award as to their costs of the abandoned claims in deceit be
on an indemnity basis.
The court held that “...such an award should be made only in
exceptional circumstances, such as where the losing party has
behaved improperly, negligently or unreasonably”. It found no
exceptional circumstances, in this case and at this stage of
proceedings, and decided to reserve the question of any costs in
relation to the abandoned allegations of deceit – whether on a
standard or on an indemnity basis – until the outcome of the trial of
this action. However, in relation to the abandoned allegations of deceit
against Mr. Barber and the Plaintiff’s discontinued claim in deceit
relating to the 2007 audit, the Defendants were awarded costs to be
taxed on a standard basis if not agreed. The question of indemnity
costs remains a live issue.
The third point that Justice Quin considered was the Defendants’
application for an interim payment. The Defendants’ contended that
the costs of dealing with the abandoned claims were substantial and
would need to be taxed. Consequently, they were seeking a payment
on account of those costs, pending taxation. The Defendants
submitted that it would be unjust to keep the Defendants out of their
costs of the abandoned Claims until the conclusion of the
proceedings. Relying on the decision in Al Sadik –v– Investcorp Bank
BSC (2012) (2) (CILR) 33 the Defendants maintained that an award on
an interim basis would be justified on the facts. The Court held that an
interim award of costs was not within the inherent jurisdiction of the
Court, not following Al Sadik –v– Investcorp Bank (unreported) 3 July
2012, and found no basis for making an interim order in this case, and
ordered costs to be costs in the case.
DIVIDEND DECLARED BY COMPANY – WHETHER SHAREHOLDERS ENTITLED IMMEDIATELY TO PAYMENT – DISPUTE ARISING OVER CERTAIN PAYMENTS MADE AMIDST ALLEGATIONS AND COUNTER-ALLEGATIONS OF FRAUD
Talent Business Investments Ltd. –v– China Yinmore Sugar Company Ltd. and Another (24 April 2015)
The case arises out of a Claim by the Plaintiff, Talent Business
Investments Limited (“Talent”) for unpaid dividends, claiming as a
shareholder of the Defendant, China Yinmore Sugar Company Ltd.
(“China Yinmore”). Talent’s Claim, which was for US$5,663,761, was
supported by evidence of Mr. Zhang Nan, acting as its majority
shareholder and sole director. The Claim was met with a defence and
Counterclaim by China Yinmore, alleging not only that Talent received
its dividend but also that it was overpaid by some US$2.8 million, the
amount for which the Counterclaim was raised.
The law on entitlement to dividends, once they are declared, is settled
and its applicability to the circumstances of this case was not disputed
once the dispute over the circumstances of the payment was resolved.
In Inland Revenue Commissioners –v– Laird Group Plc [2003] UKHLL
54, Lord Millet speaking on behalf of the Court, explained that:
“…by declaring a dividend, the directors [of the company] effectively
release the funds due to the shareholders from their [i.e. the directors’]
power to retain them in the business”.
It follows that once declared, the Company has no power to retain the
money; it has been released to those entitled to share in the amount
payable by way of dividend. Under the Companies Law, there is no
provision stipulating the time for a company to distribute the
dividends. Accordingly, Smellie CJ accepted that the Common Law
Rule applied.
On 24 May 2012, a resolution was passed which declared dividends
payable to Talent at US$5,663,761.37 (the “Dividend”) without
stipulating a date for payment, therefore, in accordance with common
law, the Dividend was (and remains) immediately due and payable.
There was a further dispute over a payment instruction to Great Ally
Group Limited (the “GAPI”), dated 31 July 2012, bearing the Great Ally
corporate seal, for the payment of US$8,503,460 in respect of
dividends to which they were entitled. The dispute pivoted on
whether the payment was made and received by Ms. Wen Xia on
behalf of Mr. Zhang Nan (76.86% shareholder of Talent) as an
overpayment of Talent’s dividends (as China Yinmore contended) or
whether it was made to and received by her on behalf of Great Ally on
Mr. Li Jinquan’s (68.42% shareholder of Great Ally Group Limited)
instructions, as Mr. Zhang Nan (and through him Talent) contended.
Smellie CJ found that the GAPI was created as Mr. Zhang Nan testified
under the instruction of Mr. Li Jinquan. The payment of US$8,503,460
was accepted by Ms. Wen Xia on behalf of and at the request of Mr. Li
Jinquan and the money therefore represented a payment from China
Yinmore to Great Ally. Accordingly Smeille CJ found that Talent had
not received any of its dividends for the year 2011 and that China
Yinmore was indebted to Talent for the payment of the Dividend in
the amount of US$5,663,761.37, as was claimed. The defence and
Counterclaim brought by China Yinmore was rejected.
13
CAYMAN ISLANDS
COURT OF APPEAL
CIVIL PRACTICE AND PROCEDURE – APPLICATION FOR SECURITY FOR COSTS OF AN APPEAL – SUB-SECTION 19(2) OF THE COURT OF APPEAL LAW (2011 REVISION) – SECTION 74 OF THE COMPANIES LAW (2013 REVISION) (JUSTICE MANGATAL SITTING AS A SINGLE JUDGE OF THE COURT OF APPEAL)
DD Growth Premium 2X Fund –v– RMF Market Neutral Strategies (Master) Limited. CICA 24/2014 (was FSD 33/2011), per Mangatal J (29 May 2015)
Conyers Dill & Pearman (“Conyers”) represented RMF Market Neutral
Strategies (Master) Limited (“RMF”). This case concerned a fund
named DD Growth Premium 2X Fund (In Official Liquidation) (“2X”),
which suffered severe financial difficulties in the wake of the Lehman
Brothers’ collapse in 2008. RMF was an investor in 2X for some time
and redeemed shares from 2X on multiple occasions. RMF’s
redemption of shares is the primary basis for this dispute.
The issue in this case primarily concerned redemption requests made
by a group of redeeming shareholders known as the “December
Redeemers” when 2X was of questionable solvency. Certain parties,
such as RMF amongst others, were able to redeem their shares and
obtain payment whilst others received nothing. Consequently, the
dispute involved 2X’s Joint Official Liquidators attempting to “claw
back” monies paid to RMF during this period. The Judge ultimately
agreed with Conyers’ point regarding Section 37(6)(a) of the
Companies Law. In particular, Section 37(6)(a) – (b) of the Companies
Law states:
(a) A payment out of capital by a company for the redemption or
purchase of its own shares is not lawful unless immediately
following the date on which the payment out of capital is
proposed to be made, the company shall be able to pay its debts
as they fall due in the ordinary course of business.
(b) The company and any director or manager thereof who
knowingly and wilfully authorises or permits any payment out of
capital to effect any redemption or purchase of any share in
contravention of paragraph (a) commits an offence and is liable
on summary conviction to a fine of fifteen thousand dollars and
to imprisonment for five years”.
This case has significant legal implications because it concerned the
capital maintenance doctrine which is designed to protect the
creditors of a company. Smellie CJ held that ultimately, RMF did not
have to repay the redemption monies despite the fact that 2X was
insolvent when the payments were made. Smellie CJ reasoned that as
the funds were paid from share premium, they were not legally
classified as capital and as a result, the redemptions did not breach the
Companies Law.
The above referenced hearing concerned an application for security
for costs of an appeal under Section 19(2) of the Court of Appeal Law
and Section 74 of the Companies Law. 2X appealed the prior
Judgment made by the Honourable Chief Justice Smellie on 17
November 2014. In particular, Section 19(2) of the Court of Appeal Law
states:
“The appellant shall, at the time of lodging the notice of appeal
required by subsection (1), deposit in the Grand Court the sum of fifty
dollars as security for the due prosecution of the appeal together with
such further sum as security for costs of the appeal as a Judge of the
Grand Court may direct, and such security for costs may be given by
the appellant entering into a bond by himself and such sureties and in
such sum as the Judge of the Grand Court may direct, conditioned for
the payment of any costs which may be awarded against the appellant
and for the due performance of the judgment of the Court”.
Furthermore, Section 74 of the Companies Law states:
“Where a company is plaintiff in any action, suit or other legal
proceeding, any Judge having jurisdiction in the matter, if he is
satisfied that there is reason to believe that if the defendant is
successful in his defence the assets of the company will be insufficient
to pay his costs, may require sufficient security to be given for such
costs, and may stay all proceedings until such security is given”.
In support of the application for security for costs, RMF argued,
amongst other things, that: (1) unlike a court of first instance, the Court
of Appeal has to take into account the fact that 2X, the Appellant, had
already had the issue of security for costs determined against it; (2) it
would be an injustice to allow the Appeal by 2X to proceed without
security for costs being furnished as RMF would be unable to enforce
a costs order against 2X due to its impecuniosity and (3) when
determining whether an Order for security for costs would prevent an
Appeal, it is necessary for 2X to establish not only that it is unable to
furnish security from its own resources but it is also unable to realise
the money from elsewhere, namely shareholders (i.e. banks and large
institutional investors) or third party funders.
14
CAYMAN ISLANDS
In determining that 2X should provide security for costs, the Court
ultimately held, amongst other things, that 2X did not provide suffice
evidence: (1) of its investors or backers; (2) of its investors’ inability, as
opposed to unwillingness, to provide the security for costs and (3) to
satisfy the Court that RMF, which had previously obtained a Judgment
in its favour and an Order for security for costs, was attempting to
stifle a genuine appeal by 2X.
15
INDEX
CASES BY SUBJECT
SECTION:
Trusts
2 BERMUDA - SUPREME COURT - TRUSTS (SPECIAL PROVISIONS) ACT, 1989
- BEDDOE RELIEF - NON CHARITABLE PURPOSE TRUST - INDEMNITY
- DEFENCE BY TRUSTEES
4 BERMUDA - SUPREME COURT - TRUSTS - COURT’S FUNCTION IN APPROVING
EXERCISE OF TRUSTEE’S DISCRETION - DOES REGARD NEED TO BE GIVEN TO
WIDER SOCIAL EFFECTS OF PROPOSED SETTLEMENT
Practice and Procedure
3 BERMUDA - SUPREME COURT - RULING ON COSTS - THE EVIDENCE ACT,
1905 (AS AMENDED) - ORDER 70 OF THE RULES OF THE SUPREME COURT,
1985
4 BERMUDA - COURT OF APPEAL - INTERNATIONAL COOPERATION (TAX
INFORMATION EXCHANGE AGREEMENTS) ACT, 2005 (THE “ACT”) -
DISCLOSURE OF DOCUMENTS PLACED BEFORE THE COURT
5 BERMUDA - COURT OF APPEAL - RSC ORDER 45 - BERMUDA
INTERNATIONAL CONCILIATION AND ARBITRATION ACT, 1993 (THE “1993
ACT”) - APPEAL AGAINST REFUSAL OF STAY OF ENFORCEMENT
7 BVI - COURT OF APPEAL - CIVIL APPEAL - WHETHER LEARNED MASTER
ERRED IN REFUSING TO SET ASIDE DEFAULT JUDGMENT - WHETHER
LEARNED MASTER ERRED IN THE EXERCISE OF DISCRETION
8 BVI - COURT OF APPEAL - INTERLOCUTORY APPEAL - DEALING WITH
FIXED DATE CLAIM SUMMARILY RULE 27.2(3) OF THE CIVIL PROCEDURE
RULES, 2000 - APPELLANT’S DEFENCE STRUCK OUT BY LEARNED JUDGE
IN COURT BELOW AND FIRST HEARING OF CLAIM TREATED AS TRIAL AND/
OR MATTER DEALT WITH SUMMARILY - NO EVIDENCE RECEIVED FROM OR
ON BEHALF OF RESPONDENT/CLAIMANT BY JUDGE IN DEALING WITH
CLAIM AND JUDGMENT ULTIMATELY ENTERED FOR RESPONDENT/
CLAIMANT - WHETHER LEARNED JUDGE ERRED IN ADJUDICATING CLAIM
IN THIS MANNER
Costs
3 BERMUDA - SUPREME COURT - EX TEMPORE RULING ON COSTS - COSTS
FOLLOW THE EVENT - REAL WORLD SUCCESS OF CLAIM - CONSIDERATION
OF THE BACKGROUND TO THE LITIGATION
7 BVI - COURT OF APPEAL - INTERLOCUTORY APPEAL - ASSESSMENT OF
COSTS - RULE 65.12 OF THE CIVIL PROCEDURE RULES, 2000 - WHETHER
LEARNED MASTER ERRED IN ASSESSING COSTS WHERE THERE WAS NO
ADEQUATE MATERIAL OR ITEMISED BILL OF COSTS - WHETHER LEARNED
MASTER ERRED IN APPLYING ENGLISH HIGH COURT CASE TO ASSESSMENT
OF COSTS UNDER CPR 65.12 - WHETHER LEARNED MASTER ERRED IN
AWARDING REFRESHER FEES TO COUNSEL
9 CAYMAN ISLANDS - GRAND COURT - THIRD PARTY COSTS ORDER - COSTS
AGAINST NON-PARTIES TO PROCEEDINGS
11 CAYMAN ISLANDS - GRAND COURT - JUDGMENT ON COSTS - COSTS
THROWN AWAY AND OCCASIONED ON PLAINTIFF’S AMMENDMENT TO
STATEMENT OF CLAIM - COSTS OF AND THROWN AWAY BY ABANDONED
CLAIMS IN DECEIT - INTERIM PAYMENT ON ACCOUNT PENDING TAXATION
13 CAYMAN ISLANDS - COURT OF APPEAL - CIVIL PRACTICE AND PROCEDURE
- APPLICATION FOR SECURITY FOR COSTS OF AN APPEAL - SUB-SECTION
19(2) OF THE COURT OF APPEAL LAW (2011 REVISION) - SECTION 74 OF THE
COMPANIES LAW (2013 REVISION) (JUSTICE MANGATAL SITTING AS A
SINGLE JUDGE OF THE COURT OF APPEAL)
Companies
6 BERMUDA - COURT OF APPEAL - INTERPRETATION OF CONTRACTS - SHARE
REPURCHASE AGREEMENTS
10 CAYMAN ISLANDS - GRAND COURT - REDEMPTION OF SHARES -
RECTIFICATION OF THE REGISTER OF MEMBERS - SECTION 37(7) OF THE
COMPANIES LAW - UNDER SECTION 112 OF THE COMPANIES LAW
12 CAYMAN ISLANDS - GRAND COURT - DIVIDEND DECLARED BY COMPANY
- WHETHER SHAREHOLDERS ENTITLED IMMEDIATELY TO PAYMENT -
DISPUTE ARISING OVER CERTAIN PAYMENTS MADE AMIDST ALLEGATIONS
AND COUNTER-ALLEGATIONS OF FRAUD
INDEX
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