N.H. International (Caribbean) Ltd v Clico Investment Bank Ltd et Al
| Jurisdiction | Trinidad & Tobago |
| Judge | Rajkumar, J. |
| Judgment Date | 28 January 2011 |
| Neutral Citation | TT 2011 HC 32 |
| Docket Number | CV 3844 of 2009; 3400 of 1999; CV 1205 of 2006 |
| Court | High Court (Trinidad and Tobago) |
| Date | 28 January 2011 |
High Court
Rajkumar, J.
CV 3844 of 2009; 3400 of 1999; CV 1205 of 2006
Mr. Alvin Fitzpatrick S.C, Ms. Lesley-Ann Lucky Samaroo, Mr. Shiv Sharma instructed by Mr. Adrian Byrne for the claimant
Mr. Seenath Jairam S.C., Mr. Dharmendra Punwasee instructed by Ms. Marcelle Ferdinand for the defendant, National Stadium Project Corporation
Trust and Trustees - Determination of existence of trust — Assignment of legal chose in action
- BACKGROUND – 3 2. THE ISSUES – 7 3. THE CLAIM – 8 4. CHRONOLOGY – 9 5. THE PROJECT DOCUMENTATION – 10 6. THE LAW
-
A. THE QUISTCLOSE ARGUMENT – 12
THE CASES
-
(i) QUISTCLOSE – 21
-
(ii) CARRERAS – 24
-
(iii) TWINSECTRA – 33
-
(iv) GENERAL COMMUNICATIONS – 50
-
(a) IRREVOCABILITY – 53
-
(b) COMMUNICATION – 57
-
(c) REPAYMENT -58
-
-
-
B. THE ASSIGNMENT ARGUMENT – 60
-
(i) MATTERS RELEVANT TO WHETHER AN ASSIGNMENT OCCURRED – 60
-
(a) ASSIGNMENT — FACTUAL ISSUES – 75
-
(b) ASSIGNMENT — LAW – 76
-
-
-
C. NATIONAL STADIUM'S DEFENCE – 83
-
D. NATIONAL STADIUM'S CLAIM TO THE DEPOSITED AMOUNT – 85
-
E. THE CLAIM AGAINST CIB – 90
-
F. THE QUESTION OF INTEREST – 92
-
G. LACHES – 99
-
7. FACTORS AFFECTING CREDIBILITY – 103
-
8. CONCLUSION AND DISPOSITION – 105
-
9. ORDERS - 106
In 1996, the Government of Grenada (the government) decided to construct a sporting complex (the Project).
In 1996 Mr. Colm Imbert formed a company (ICSL) in Trinidad and made a proposal to the Government of Grenada for ICSL to implement and develop this project including arranging the finance for its construction. The financing was to be from investors arranged by and through Clico Investment Bank (CIB).
The company ICS Grenada [ICS or ICS Grenada] was later formed for the purpose of the construction aspect of this project and the company National Stadium [NS] was formed to be the Project Company.
Mr. Imbert was one of the principals of ICSL, ICS Grenada, and National Stadium. Mr. Elias' company N.H. INTERNATIONAL (CARIBBEAN) LIMITED [NH] was awarded a subcontract by ICS Grenada for construction work to be performed, initially of 70 % of the value of the initial project cost.
NH alleges that before it embarked on its construction activities for the project it sought assurances from Mr. Imbert, (who was one of the principals of ICSL, ICS Grenada, and the project company- National Stadium) – that NH would be paid directly from the funds arranged via CIB from investors– and that the sum, equivalent to its payment for work to be done under its subcontract, would be assigned to it by ICS. This would obviate the need for its having to wait to be paid through ICS after ICS first received payment from the project company - NS.
It alleged that CIB was a party to this arrangement which was arrived at in a meeting at which Mr. Imbert and CIB's representative, Mr. Archer were present and that this assignment arrangement was confirmed/evidenced by two letters in which it sought and received confirmation that this arrangement was in place.
It further contends that a trust was constituted in favour of NH of the sum due to it under its construction contract for work done and approved, out of the sum that CIB had arranged to finance the project. As the purpose of the financing was specifically the construction activities of NH - and other contractors for the Project, this gave rise to a special purpose Quistclose type trust, enforceable by NH as a beneficiary thereunder against the holder of the fund held by CIB.
ICS purported to terminate the contract with NH when on 29th October 1999 ICS wrote to NH purporting to give 14 days' notice of its intention to terminate the Construction Agreement.
NH then sought and obtained an interim injunction restraining CIB from paying, out of monies to thereafter become due and payable under the Facility Agreement, any monies which would reduce the balance available for disbursement thereunder below the sum of EC$7,430,724.70 (“the said EC Sum”).
On November 5, 1999 NH obtained an ex parte injunction before the Honourable Justice Tam which injunction was continued on the inter partes hearing on November 30, 1999 in the following varied form:
“That CIB whether by its… be restrained and an injunction is hereby granted restraining CIB from doing any of the following acts, that is to say, from paying to ICS or NS out of monies to hereafter become due and payable by CIB under the Facility Agreement … an monies which would reduce the balance of advances available thereunder below the sum of EC $7,430,724.70 until the hearing and determination of this action or under further order” [Tab 10 Agreed Bundle].
NH's order in effect froze the sum held by CIB which had not yet been advanced to NH in respect of NH's contract with ICS [the frozen sum or the EC sum]
The EC Sum therefore represented advances under the Facility Agreement not disbursed by CIB as a result of the interim injunction
An indenture dated 24th September 2001(“the Indenture”) made between National Stadium and CIB recited the former's indebtedness under the Facility Agreement at US$29,935,525.03 including the original indebtedness of US$23,000,000.00 the amount originally payable under the Facility Agreement being US$23,000,000.00. and a further loan in the sum of US$1,231,067.60 (see Indenture dated the 24th September 2001 exhibited as “EPE56” to the witness statement of Mr. Elias found at pages 806-811 of the Trial Bundle)
On 8th August 2002 the Government of Grenada repaid the Facility to CIB including the original financing and the additional loan.
NH commenced arbitration proceedings against ICS and on 18th March 2002 obtained an award in its favour for the net figure of EC$8,412,636.83 together with interest.
NH seeks to recover some part of the award against the frozen sum.
The claim against CIB arises in respect of:
-
(i) The funds frozen by injunction, and
-
(ii) Interest which allegedly should have accrued thereon, as well as
-
(iii) An alleged short payment arising on the non direct conversion of the EC fund held by CIB to US dollars when it was so ordered by the High Court.
EC Sum — The sum of EC $7,430,724.70
Deposited Amount — the sum actually deposited by CIB pursuant to the order of the Honourable Justice Tam dated July 23 rd 2004 into a joint interest bearing account in the name of attorneys at law for the parties.
Additional sum- the amount by which the sum actually paid by CIB fell short of the EC sum converted directly into US dollars.
At issue therefore are:
-
(a) Whether an assignment from ICS exists in favour of NH in respect of the Monies payable by CIB for NH's work on the Project (“the frozen sum').
-
(b) Whether a trust exists in respect of the frozen sums for the benefit of contractors on the project.
-
(c) If so whether such a trust is enforceable by NH.
The claimant NH's claim arises out of 2 actions which were consolidated and in which it seeks the following relief (inter alia):
(i) By a Writ of Summons filed on November 5, 1999 (now CV No. 2009 — 03844), amended on January 6, 2000 the plaintiff, NH International (Caribbean) Limited (hereinafter called “The plaintiff' or “NH”) brought an action against CLICO Investment Bank Limited (hereinafter called “CIB”) I.C.S. (Grenada) Limited (hereinafter called “ICS”) and National Stadium Project (Grenada) Corporation (hereinafter called “NS”), and claimed:
-
(ii) A declaration that NS is a trustee for ICS of the rights and obligations accruing to it under the Facility Agreement between CIB and NS.
-
(iii)A declaration that there is a binding assignment in favour of NH of so much of the monies due and to become due from CIB under the Facility Agreement as would from time to time be due and payable to NH under the construction agreement dated June 6, 1997.
-
(iv)As against ICS and NS a declaration that there is a binding assignment in favour of NH of so much of the monies due and to become due from NS to ICS under the agreement annexed to the Development Agreement as would from time to time be due and payable to NH under the Construction agreement.
-
(i) further and/or alternatively a declaration that the sum of $7,430,724.70 (the EC Sum) was held on trust for NH;
-
(ii) a declaration that the sum of US 2,682,719.24 (the Deposited Amount, together with all interest accumulated thereon and the Additional sum of US 93,174.54 are held on trust for NH;
-
(iii) alternatively, a declaration that the Deposited Amount and the Additional Sum are held on trust for the sole purpose of applying the same in payment of suppliers and other providers of goods and services in relation to the Project;
-
(iv) a declaration that NH as a supplier of goods and services in relation to the Project is entitled to enforce the said trust for its benefit;
-
(v) an order that the Deposited Amount and the Additional sum, be paid out to NH;
-
(vi) Interest;
-
(i) March 19 1996 — Incorporation of ICSL in Trinidad.
-
(ii) 1996-The Proposal.
-
(iii) 24th December, 1996 — letter of award.
-
(iv) January, 1997- Memorandum of Understanding [EPE2].
-
(v) April 11, 1997 -The incorporation of National Stadium NS.
-
(vi) April 11, 1997 -The formation of ICS in Grenada.
-
(vii) April, 1997-The Supplemental Memorandum of Understanding.
-
(viii) May 1, 1997- Submission of Tender by NH.
-
(ix) May 9, 1997 -Enactment of Act No. 8 of 1997 by the Parliament of Grenada.
-
(x) May 15 1997 - The Conduit Agreement
-
(xi) May 15 1997 - The Facility Agreement
-
(xii) May 15 1997 - The Development Agreement
-
(xiii) June 6 1997 - The Construction...
To continue reading
Request your trial