Belgrove v Belgrove et Al
| Jurisdiction | Trinidad & Tobago |
| Judge | Mendonca, J. |
| Judgment Date | 23 February 2001 |
| Neutral Citation | TT 2001 HC 29 |
| Docket Number | H.C.A. No. 1510 of 1991 |
| Court | High Court (Trinidad and Tobago) |
| Date | 23 February 2001 |
High Court
Mendonca, J.
H.C.A. No. 1510 of 1991
Mr. A. Sinanan for the plaintiff.
Mr. I. Bajnamin for the defendants.
Company law - Shares — Whether held as beneficial owner or nominee — first defendant transferred into his own name certain shares belonging to plaintiff — Plaintiff sought inter alia, declaration of entitlement to same shares and that defendant held shares on trust for plaintiff and order setting aside registration of shares in name of defendant — Defendants contended that plaintiff held shares not as beneficial owner but rather as nominee for his brother — Whether defendant sought to secure interest of true beneficial owner — Whether transfer should be set aside — Plaintiff had not established title to shares — Claim failed and action dismissed.
The plaintiff in his Statement of Claim alleges that on June 9th 1978 that he was appointed director of the defendant company and that there was allotted to him 29,281 ordinary shares in the defendant company. The plaintiff further alleges that in or around the month of September 1984 he needed to travel to Canada in order to receive medical attention. The first defendant advised the plaintiff that he should sign a transfer form with respect to his shares in the defendant company which would enable the plaintiffs children to benefit easily should the plaintiff not survive the medical treatment. The plaintiff signed the transfer form and went abroad.
The plaintiff returned to Trinidad in around October 12th 1984 and requested the return of the share transfer form and thereafter made numerous requests for its return but the first defendant however failed to return it to him and on July 18th 1986 the defendant transferred the shares to his own name. As a consequence the plaintiff claims:
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(a) A declaration that he is a shareholder of the defendant company and is entitled to 29,281 Ordinary Shares therein.
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(b) A declaration that the first defendant is holding the said shares in trust for the plaintiff:
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(c) An order that the transfer of the aforesaid 29,281 share be set aside.
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(d) An injunction restraining the defendants and each of them whether by themselves their servants and/or agents or howsoever otherwise from prohibiting the plaintiff from attending and participating in any meeting whatsoever of the shareholders of the defendant company and/or from holding any meeting of the shareholders of the defendant company unless the plaintiff is given due notice thereof and allowed to attend and participate therein.
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(f) An order setting aside the registration of the said shares in the name of the first defendant.
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(g) Damages.
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(h) Costs.
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(i) Further and/or other relief.
There is also a claim in the Statement of Claim by the plaintiff relating to his alleged dismissal from the position as Manager of the Production Department of the defendant company. However that was not pursued.
The defendants in their defence admit that on June 9th 1978 the plaintiff was appointed a Director of the defendant company and that 29,281 shares were allotted to him. The defendants however deny that such shares were allotted or intended to be allotted to the plaintiff as the beneficial owner thereof. The defendants contend that the shares were allotted to the plaintiff as nominee for his brother, Reynold Belgrove, and as the plaintiff well knew were allotted to him so that he could hold them as such nominee until they could be beneficially vested in due course in the said Reynold Belgrove who was at all material times a citizen of the USA and required a licence to hold the shares. The defendants deny, that the transfer form was sighed in the circumstances alleged by the plaintiff and allege that the plaintiff had several years previously signed a blank transfer form so that Reynold Belgrove could at any time have the shares transferred to him or any person at his direction.
The defendants also admit that the shares were transferred to the first defendant in 1986 but they contend that they were so transferred by Reynold Belgrove in exercise of his lawful right as beneficial owner thereof.
The defendants have counterclaimed for delivery of certain records, papers and documents allegedly removed from the defendant company by the plaintiff and damages for their retention. The counterclaim however wag not pursued.
The central factual issues which arise the pleadings are therefore (1) whether the shares in the defendant company which were allotted to the plaintiff on June 9th 1978 were allotted to him as beneficial owner thereof or in trust for Reynold Belgrove. and (2) whether the transfer form was signed at the time of the transfer to the plaintiff on June 9th, 1978 or in the circumstances outlined by the plaintiff in his Statement of Claim.
It is common ground that the shares in question were allotted to the plaintiff at a meeting on June 9th 1978. According to the first defendant the plaintiff had been informed sometime previously of the arrangement that the shares were to be transferred to him on bust for Reynold Belgrove and he agreed to that. In pursuance of this arrangement the first defendant stated that the plaintiff signed a transfer form in blank and after it was signed the first defendant took the form into his possession together with the share certificate with respect to the said shares and lodged them for safe keeping at the Chase Manhattan Bank in San Fernando. There the documents stayed until they, were released to Reynold Belgrove in 1986.
The plaintiff on the other hand stated in evidence that he did not sign a blank transfer form at the meeting in 1978. in his witness statement which formed part of the plaintiff's evidence in chief, he stated that the only document he signed was the share certificate. It is however quite clear from the share certificate that it was not signed by the plaintiff: It is therefore not surprising that he sought to correct this and stated in further evidence in chief given orally that the document he signed was the coupon on the shares certificate. The impression given by the plaintiff' in his evidence in chief is that the coupon was the only document he signed. But in cross-examination he accepted having signed two documents.
He did not acknowledged the signature purporting to be that of Lionel Belgrove, his father, on the instrument by which the shares were transferred to him by his father to be that of his father. In fact he stated quite categorically that his father did not transfer the shares by a transfer form signed by him and that when the shares were transferred to him at the meeting in June 1978 his father did not “put any transfer form across the table”. It is of course entirely consistent with the plaintiff's case that the transfer form whereby the shares were transferred to him is a genuine document. The evidence of the plaintiff' is therefore surprising. But yet the plaintiff did acknowledge his signature on the form under the declaration that he had acquired the shares. He was however very emphatic that the other signature on the transfer for purporting to be his witnessing that of Lionel Belgrove, was not his.
On a visual comparison, the two signatures purporting to be that of the plaintiff, the one he acknowledged and the one he did not, appear to be similar. Be that as it may it is not the plaintiff's case that there was any forgery or irregularity surrounding the transfer of the shares to him and I am not prepared to accept the plaintiff's evidence that the signature of “Stephen Belgrove” on the transfer form witnessing the signature of Lionel Belgrove is not that of the plaintiff.
It seems to me in the circumstances that the plaintiff's evidence as to what in fact he signed at the meeting is unreliable.
As I mentioned before, the plaintiff admits having signed a blank transfer form. He however said it was signed in 1984 and not at the meeting in June 1978. The plaintiffs evidence on this aspect is that he signed the form in 1984 while leaving to go to the airport. At that time the plaintiff said he was on his way to Miami with his two youngest children to seek medical treatment for himself and one of the children. The first defendant stopped the car in which the plaintiff was a passenger and represented to him that it would make the transfer of his shares simple in the event that he did not survive the operation he was about to undertake if he were to site a transfer form. The plaintiff agreed and signed the transfer form on the hood of the vehicle before proceeding to the airport.
These allegations are denied by the first defendant. He said that the plaintiff was not going for surgery but was going to explore the possibility of what could he done about his hip. According to the first defendant the primary purpose of the plaintiff's trip aboard was to seek medical attention for his child who had a speech defect. I prefer the evidence of the first defendant. I find it improbable that if the plaintiff was in fact going away for medical attention, which posed such a great. risk to himself; he would have travelled with his two youngest children who were aged 8 and 3-5 and one of whom was to have medical treatment. It seems to be more probable that the plaintiff was not going away to undergo such medical treatment but as the first defendant contends to ascertain or explore whether there was anything which could be done for his hip. If that is so it removes the basis on which, according to the plaintiff, he allowed the first defendant to persuade him to sign the blank transfer form.
There are however other areas of concern in the plaintiff's evidence relating to the circumstances surrounding the signing of the transfer form.
According to the plaintiff when he signed the form he did so on the hood of the vehicle in which he...
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