3G Technologies Ltd v Rudranand Maharaj
| Jurisdiction | Trinidad & Tobago |
| Judge | M. Dean Armorer J.A.,V. Kokaram J.A. |
| Judgment Date | 28 July 2022 |
| Neutral Citation | TT 2022 CA 33 |
| Docket Number | Civil Appeal No. P046 of 2022 |
| Court | Court of Appeal (Trinidad and Tobago) |
| Year | 2022 |
M. Dean Armorer J.A.
V. Kokaram J.A.
Civil Appeal No. P046 of 2022
Claim No. CV2014-02872
IN THE COURT OF APPEAL
Mr. Donald G. Seecharan and Mr. Riaz P. Seecharan for the Appellants.
Mrs. Deborah Peake S.C. leads Mr. Kerwyn Garcia instructed by Ms. Marcelle A. Ferdinand for the First Respondent.
Mr. Darrell P. Allahar instructed by Ms. Laura Persad for the Second Respondent.
This procedural appeal is against a decision made by the case management judge dismissing all four of the Appellants' procedural applications 1 seeking, among other things, the provision of accounts from both the First Respondent 2 as receiver (“the receiver”) of the First Appellant, 3G Technologies Limited (“3G”) and from the Second Respondent for rents due to 3G paid to the receiver. The Appellants criticised the case management judge for, among other things, failing to actively case manage this dispute to order these accounts, notwithstanding the absence of a pleaded claim for such relief, as it will ultimately resolve this claim without the need for a trial.
It is true that under the Civil Proceeding Rules 1998 (“CPR”) the resolution of a claim by trial is a last resort. One of the main duties of the case management judge is to encourage parties to settle the entire claim or issues that may arise for disposition. Equally, it is true that it is the court's duty to actively manage the shape and pace of litigation to give effect to the overriding objective. Involved in the exercise of active case management is achieving the main goals of identifying relevant issues in the claim for resolution, determining the method of resolving them, encouraging settlement and preparation for trial, if necessary. The greatest challenge in actively managing cases lies in achieving the right balance of the principles of equality, economy, proportionality and fairness when making process choices for the resolution or determination of the issues in a claim. 3
Actively managing cases however does not mean that the case management judge should use the overriding objective as a magic carpet to whimsically glide over central issues and relevant interests arising from the pleaded case. Further procedural fairness remains a key aspect of active case management in addressing the relevant issues in the claim and how they should be properly navigated in the context of the dispute. To go beyond this remit would require a deeper level of co-operation and informed consent of the parties to consensually depart from the clear roadmap set out in the pleaded issues of their case. That will be more easily and preferably achieved in an alternative dispute resolution process or non-adversarial style of dispute adjudication.
While this procedural appeal is not against a decision made at a case management conference, the decision of the case management judge was in the context of the judge actively managing the Appellants' claim which concerned the validity of the receiver's appointment. The decision was made against the backdrop of two significant events: a direction by the Court of Appeal 4 that there should be a speedy trial of that claim and second, where the case management judge had already given directions for that trial to proceed.
The upshot of the applications, were they successful, would have resulted in the stay of the proceedings and further delay of the trial with no guarantee that if accounts were provided a trial of the main issue of the validity of the receiver's appointment would not be necessary. For the reasons set out in this judgment, the case management judge's dismissal of the applications in the context of the proceedings was not plainly wrong. Our main findings with respect to the main issues raised by the Appellants on their applications in this appeal are as follows:
A. Whether the case management judge failed to actively case manage this dispute by not ordering the Respondents to provide accounts.
Finding: The case management judge was not plainly wrong to await the determination of the main issue of the legitimacy of the appointment of the receiver before considering any issue with respect to a duty to account. To do otherwise would be to side step the pleaded case of the Appellants and in the context of the proceedings such a duty was at best a premature consideration.
B. Whether the case management judge breached the Appellants' right to a fair hearing and due process.
Finding: There was no basis to make any constitutional challenge in these proceedings to the approach adopted by the case management judge in his determination of the procedural applications. In any event the manner in which the case management judge provided the Appellants a full opportunity to be heard and ruled on all the applications which were submitted by the Appellants to him for decision satisfies any requirements of due process or procedural fairness.
C. Whether the case management judge's decision was tainted by apparent bias.
Finding: Any challenge to the case management judge's ability to hear the case should be first made to him. In any event there is nothing that was said in the decision which would amount to apparent bias on the basis that the case management judge had pre-determined this claim against the Appellants. Any robust criticism made by the case management judge did not cross the line into having a closed mind against the Appellants which will prevent him from determining the claim otherwise than on its merits.
The facts have been well rehearsed in the case management judge's reasons and that of the decision in the Court of Appeal 5. All of these applications relate to the Appellants' claim that the appointment of a receiver over the proceeds of their rental income from their property at 112-114 Duke Street, Port of Spain (“the Duke Street property”) was invalid and illegal. The trial of that claim is now fixed for hearing on 22 nd and 23 rd November 2022.
The claim arose out of an all assets debenture given to 3G from Scotiabank as guarantee in favour of Scotiabank by the Seecharans and a collateral deed of mortgage over the Duke Street property. This represented the security for a loan borrowed by 3G from Scotiabank to construct a building on the Duke Street property. The Judiciary occupied portions of the Duke Street property paying for it a monthly rent and a portion of electricity charges incurred with respect to its use of the property.
When the receiver was appointed by Scotiabank under its powers under the debenture, the First and Second Appellants, the directors of 3G, the Seecharans, contended among other things that the appointment of the receiver was illegal. They took the view that their instalments on the loan were being paid in a timely manner, it was not in arrears of the mortgage and the receiver's appointment was in breach of the Bankruptcy and Insolvency Act 2007 (“BIA”), the BIA regulations, the Companies Act Chap. 81:01, the Conveyancing of Law and Property Act Chap 56:01, the Financial Institutions Act Chap 79:09 (“FIA”) and the Rules and Regulations of the Institute of Chartered Accounts. 6
The Appellants also alleged that certain representatives of Scotiabank acted in bad faith in appointing the receiver. They sought several
There are some events of significance in the proceedings.
On 6 th July 2017 the Attorney General was added as an interested party on its application to be joined solely for the purpose of obtaining directions from the Court as to whom outstanding rents should be paid by the Judiciary. On 12 th June 2019 the court ordered that all arrears of rent and future rents were to be paid to the receiver (“the June 2019 order”). The Appellants' appeal against that order was dismissed and the order that the arrears of rent held in an escrow account and future rents which were to be paid to the receiver was affirmed. 7
The Court of Appeal's judgment affirming that order is an important aspect of the context of this dispute to understand the case management judge's approach to these applications.
In that appeal, the Appellants had submitted that the receiver could not receive these sums when he was invalidly appointed and it was not enough for the receiver to simply rely on his instruments of appointment when the validity of his appointment was directly challenged. The Court of Appeal agreed that where the appointment of the receiver is challenged, he must establish at least a prima facie case that one of the events that gives rise to the power to appoint has arisen.
Mendonça J.A. and Jones J.A. held that the receiver had established that demand was made for the moneys secured by the debenture thereby giving rise to the exercise of the power to appoint a receiver. They
concluded that the “Receiver has established, at least on a prima facie basis, the validity of his appointment. The Receiver was therefore in a position to receive the rents of the property if it be the property of the company.” 8The Court of Appeal also agreed that while the Duke Street property was owned by the Seecharans the rent was the property of 3G and is charged by the debenture. 9 It also made the important finding that the case management judge was not plainly wrong to have the monies paid to the receiver until the validity of his appointment is determined at trial. 10
Importantly, the Court of Appeal had in mind that...
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