Pampellonne and Pampellonne v Royal Bank Trust Company (T'dad Ltd)

• Jurisdiction: Trinidad & Tobago
• Court: High Court (Trinidad and Tobago)
• Judge: Roopnarine, J.
• Judgment Date: 04 November 1977
• Neutral Citation: TT 1977 HC 69
• Docket Number: No. 393 of 1969
• Date: 04 November 1977

High Court

Roopnarine, J.

No. 393 of 1969

Pampellonne and Pampellonne

and

Royal Bank Trust Co. (T'dad Ltd.)

Appearances:

Thorne Q.C. and Mr. Nelson for plaintiffs

Wharton Q.C. and Mr. Daly for defendant Co.

Tort - Negligence.

Roopnarine, J.

1 This is an action brought by the plaintiffs against the defendant company for damages resulting from negligent mis-statements and/or financial advice of the defendant, its servant and/or agent in or about the month of February, 1964.

2 In the plaintiff's amended Statement of Claim, which was filed on the 4th October 1977 more than eight years after the writ was issued, inter alia alleges that in or about the month of December, 1963 or January, 1964 the 1st plaintiff, at an interview with the defendant's General Manager one Ian Kennedy (hereinafter referred to as ‘Kennedy’) at the office in Port of Spain informed Kennedy that he desired to make certain investments, and that the company known as Davies Investments Ltd. (hereinafter referred to as ‘Davies’) had been suggested to him and he orally requested Kennedy to investigate and report on Davies and to advise him whether he should place his investments with Davies and that the defendant viz. Kennedy orally undertook to do so.

3 In pursuance of the request and undertaking the defendant by letter dated the 23rd January 1964 advised the 1st plaintiff that Davies was a respectably constituted private limited company and that it might be regarded as trustworthy for its ordinary business engagements.

4 In reliance upon this advice of the defendant by Kennedy the plaintiffs from time to time (between 1.4.65 – 28.4.66) invested ($41,000 plus) with Davies, by way of deposit various sums of money.

5 Further in or about November 1964 the plaintiffs at another interview with Kennedy sought the defendant's advice in connection with investment of certain monies and the defendant by Kennedy, orally advised the plaintiffs, that they might safely invest their monies with a company known as Pinnock Finance Company (Great Britain) Ltd., (hereinafter referred to as ‘Pinnock’).

6 In reliance of such advice the plaintiffs from time to time (20.11.64 – 4.8.66) invested various sums of money (amounting to almost $76,000.00) by way of deposit with Pinnock and that the defendant in giving the advice referred to was negligent —

7 Particulars of Negligence

• (a) Offering the statements contained in the said letter of January 23, 1964 in relation to Davies as being relevant to the said request made by the first plaintiff or to the purpose for which he sought advice of the defendant, and/or as a basis upon which hey might with reasonable safety make a deposit investment with Davies;

• (b) Failing to advise the plaintiffs, having regard to their age and circumstances, of the advisability of making investments of such a nature;

• (c) Failed to make any or any adequate inquiries or investigations or financial assessments prior to the giving of such advice; end would upon proper inquiries investigations and/or assessments have discovered or determined that it was improper to advise as it did;

• (d) Failing to advise and/or to warn the plaintiffs, or either of them of the abnormally high risk involved in making such deposit investments at rates of interest significantly higher than those generally prevailing and/or failing to advise and/or to warn the plaintiffs, or either of them that the interest rates being paid by Davies and Pinnock indicated that movies deposited with them were being placed in high risk investments;

• (e) Failing to make any or any adequate inquiries into the circumstances of the plaintiffs, or of either of them upon receiving the said requests for financial advice;

• (f) Failing to exercise reasonable skill and care as a professional investment adviser in giving information and/or advice and/or opinion to the plaintiffs, or either of them in relation to Davies and Pinnock respectively.

8 Both Davies and, Pinnock went into liquidation the former on or about January 24, 1967, the date of the passing of a winding up resolution, and the latter on or about April 4, 1968, though trading was suspended on March 31, 1967 and by reason of the negligence of the defendant the plaintiffs suffered loss and damage viz:–

9 Special Damage — Principal and Interest $101,475.71 and the plaintiffs claim (general) damages.

10 The amended defence was delivered on the 20.11.72 and was not further amended as a result of the amended Statement of Claim. By its defence the defendant inter alia stated — that it admits that the defendant is a trust company duly incorporated under the Companies Ordinance Ch. 31 No. 1 and in the course of its business gives advice to its clients concerning investments, and undertakes investments on behalf of its clients.

11 It further admitted that an interview did take place between the 1st plaintiff and Kennedy in or about December 1963 or January 1964 but denied that the request stated by the plaintiff was made or any undertaking was given to him.

12 It further admitted that it wrote to the plaintiffs on 23rd January 1964 giving him certain information but denied that by such letter it offered counsel to the 1st plaintiff to the effect alleged by the plaintiffs.

13 It was further admitted that an interview did take place at Kennedy's office in November 1964 but denies that any advice was sought or given by it.

14 Further the defendant will contend that in respect of both Davies and Pinnock, Kennedy provided the 1st plaintiff with information which the first plaintiff knew was procured or to be procured from third parties and that such information was correct to the best of the defendant's knowledge at the time it was provided to the first plaintiff.

15 Further the defendant will contend that [it was under no duty to make any inquiries, investigations or financial assessments but in any event the said information was procured as a result of proper and/or adequate inquiries and/or investigations and/or financial assessments.]

16 Further and/or alternatively the defendant will rely on section 5 of the Limitation of Personal actions ordinance Ch. 5 No. 6.

17 On the 4th October 1977 I heard argument on the application filed on the said date on behalf of the plaintiff to amend the Statement of Claim by adding the words underlined in it, but more particularly abandoning two of the three grounds of particulars of negligence to para.8 of the Statement of Claim as originally filed and adding thereto four other sub-paragraphs as particulars of negligence. Having heard the defendant's objection to the grant of the application, I considered it advisable to have all the evidence available to the Court and I did not think that prejudice or injustice to either party might result. Accordingly on the same day I made an order allowing the application in terms.

18 It has not been in dispute that to succeed in this action that the plaintiffs must establish that:–

• (a) In the particular circumstances of this case, which according to the plaintiffs' counsel themselves are unusual, that the defendant owed the plaintiffs a duty of care;

• (b) the defendant was in breach of that duty; and;

• (c) as a result of such breach the plaintiffs suffered the alleged loss.

19 I find the facts from the evidence to be that as a result of a discussion the 1st plaintiff (hereinafter referred to as the plaintiff) had with one Keith Urich about certain investment in Davies, the plaintiff sometime in December 1963 or January 1964 went to the Royal Bank Trust Company (hereinafter referred to as the defendant) armed with the address of Davies given to him by Urich. Ex. A, because of his long association with the Royal Bank of Canada (hereinafter referred to as R.B.C.) which he knew advises on investments.

20 When he got to defendant's office which at the time also housed R.B.C. he met a Mr. Slack who was an old acquaintance of his and told him he would like to see the General Manager of the defendant. Slack escorted and introduced him to Mr. Kennedy. At the time Mr. Slack had an earlier report of Davies which he handed to Kennedy and the plaintiff handed to him Urich's letter and requested him to investigate Davies for him and asked him whether he could assist him in making out his will. Mr. Kennedy undertook to fulfill his request and as a result he received a letter from Kennedy in January 1964 — Ex. A2 in these terms:–

21 “Dear Pampellonne,

22 With reference to your recent visit here, we are now advised that Davies Investment Ltd., is a respectably constituted private limited company with an authorised capital of £150,00. The last published balance sheet as at 30.6.62 indicated capital and general reserves of £512,806 and current liabilities of £99,256 against current assets of £1,227,249. All our reports indicate that this company may be regarded as trustworthy for its ordinary business engagements.

We trust this information will assist you in making up your mind as to the deposit.

Yours very truly,

Ian M. Kennedy

Manager”

On 28.1.64 the plaintiff replied to this letter in the following terms. ( Ex. 2A ₂)

“Dear Sir,

Your letter of January 23rd is hereby acknowledge with thanks.

Will endeavour to call at your office at earliest opportunity for further discussion on the subject.

Yours truly,

J.N. Pampellonne.”

23 No other discussion or correspondence took place between the plaintiff and Kennedy in respect of the Davies investment. When the plaintiff made his request of Kennedy in January 1964 he did not do so for the purpose of making any investment in Davies but filed the letter he received from Kennedy for future reference. In fact the plaintiff made his first investment in Davies on 1.4.65 more than one year after the correspondence, and subsequent investments on 9.2.66 and 20.4.66 on his own totaling $42,000 and without any further...