Exquisite Homes Ltd v Geest Industries (Estates) Ltd
| Jurisdiction | St Lucia |
| Judge | Thom JA |
| Judgment Date | 28 February 2024 |
| Neutral Citation | LC 2024 CA 3 |
| Docket Number | SLUHCMAP2023/0001 |
| Court | Court of Appeal (Saint Lucia) |
The Hon. Mde. Gertel Thom Justice of Appeal
The Hon. Mde. Vicki-Ann Ellis Justice of Appeal
The Hon. Mr. Trevor Ward Justice of Appeal
SLUHCMAP2023/0001
THE EASTERN CARIBBEAN SUPREME COURT
IN THE COURT OF APPEAL
Commercial appeal — Frustration — Compulsory acquisition by the Crown — Whether the acquisition of the respondent's lands before the completion of its agreement with the appellant amounted to a frustrating event — Breach of contract — Repudiatory breach — Whether the respondent breached its agreement with the appellant prior to the Crown's acquisition of its lands — Pleadings — Pleading dishonesty offences — Whether the pleadings sufficiently particularised bribery or secret profit — Costs — Whether the judge was justified in not awarding the successful party their costs
On 16 th December 2013, the appellant entered into an agreement to purchase land (“Parcel 314”) from the respondent (“the 2013 agreement”). The appellant paid the deposit but failed to comply with their further payment obligations. They also failed to obtain the required approvals from the Development Control Authority (“DCA”) before the completion date of the 2013 agreement. The events that followed were that in or around August 2014, the respondent's Managing Director, Mr. Maximilus Johannes informed the Board of Directors that there were nine occupiers on part of Parcel 314. The respondent decided some time after, that the Government should acquire all its lands. In furtherance of their decision, they submitted a proposal to the Government and on 29 th March 2019, the Government agreed to acquire their lands.
On 27 th June 2019, another agreement was executed between the parties (“the 2019 agreement”), similarly for the sale and purchase of Parcel 314. According to the 2019 agreement, the completion date was 27 th July 2019. The appellant had paid the required deposit, however, on 16 th July 2019, a declaration for the compulsory acquisition of the respondent's land was gazetted. Following a second publication in the Gazette on 22 nd July 2019, the respondent returned the deposit to the appellant.
The appellant consequently commenced an action in breach of contract and unlawful interference with contractual relations. The respondent, who all the while disputed Mr. Johannes' authority to execute the 2019 agreement on their behalf, counterclaimed that Mr. Johannes and the respondent's legal advisor, Mr. George Charlemagne did not receive the required permission from the Board of Directors to contract on its behalf, and they were therefore conspiring to induce the respondent to contract with the intent to injure and cause loss to its business.
The judge found that the 2019 agreement superseded the 2013 agreement. However, even though the 2019 agreement was valid, it was frustrated by the Government's acquisition of Parcel 314 prior to that agreement's completion date, rendering the respondent unable to transfer title and vacant possession. On the counterclaim, the judge found that there was no evidence to support the respondent's assertions. Both the claim and counterclaim were dismissed, and each party was ordered to bear their own costs.
The issues for the Court's determination on appeal were whether the judge erred in finding that the 2019 agreement was frustrated, and whether the judge erred in failing to find that the respondent breached the 2019 agreement prior to the acquisition of Parcel 314. The respondent's counter-appeal concerned the validity of the 2019 agreement. The respondent contended that the judge erred in her treatment of a payment by the appellant of $75,000.00 to Mr. Johannes, and the survey plan, which the respondent contended, should have been produced and registered by the appellant. The respondent also took issue with the judge's decision to not award them costs, having dismissed the appellant's claim.
Held: dismissing the appeal and directing that the appellant pay the respondent its costs on appeal and in the court below, to be assessed by a judge or master of the court below, such costs on appeal not exceeding two-thirds of the costs below; and dismissing the counter- appeal save for the issue of costs, directing that the respondent pay the appellant 75% of the costs of the counter-appeal, such costs to be assessed by a judge or master of the High Court, that:
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1. According to section 3(3) of the Land Acquisition Act, the procedure by which land is acquired by the Crown is through publication of a declaration to that effect in the Gazette. Upon the second publication of the said declaration, the land vests absolutely in the Crown. Therefore, the respondent's lands became vested absolutely in the Crown upon the second publication of the declaration of compulsory acquisition on 22 nd July 2019. The second publication amounted to a frustrating event as it occurred on 22 nd July 2019 which was prior to the completion date of the 2019 agreement. The respondent, upon the second publication, was rendered unable to perform its obligation under the 2019 agreement to convey the land to the appellant.
Sections 3 and 4 of the Land Acquisition Act Cap. 5.04 of the Revised Laws of Saint Lucia applied; Section 3 of the Land Acquisition Act Cap. 228 of the Revised Laws of Barbados considered; E Johnson & Co (Barbados) Ltd v N S R Ltd (1996) 49 WIR 27 distinguished.
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2. It is settled law that a party to a contract may treat the contract as discharged where the other party has committed a fundamental or repudiatory breach. In the present case, the appellant failed to show evidence that there was such a breach of the 2019 agreement. Firstly, the appellant relied on a letter dated 24 th July 2019, informing Mr. Charlemagne that the respondent would not proceed with the 2019 agreement. The Court found that the letter could not lead to a repudiatory breach of the 2019 agreement as it was sent after that agreement was frustrated. The appellant further submitted that since the notice to acquire was published after the 2019 agreement was executed, there must have been an agreement between the Government and the respondent between 27 th June 2019 and 16 th July 2019. However, the Court found that there was no evidence in support of that contention.
Blairmont Rice Investment Inc. v Kayman Sankar Investments Limited and Others [2021] CCJ 7 (AJ) GY applied; Hong Kong Fir Shipping Co. Ltd v Kawasaki Kisen Kaisha Ltd [1962] 2 QB 26 applied; Bunge Corporation (New York) v Tradex Export SA (Panama) [1981] UKHL 11 applied.
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3. The evidence showed that the discussions and proposal between the respondent and the Government happened before the execution of the 2019 agreement. However, the Government only took steps to acquire the lands after the 2019 agreement was executed. This was to no fault of the respondent, because the respondent did not have control over whether the Government would proceed with its decision to acquire its lands.
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4. A party who wishes to rely on fraud or dishonest conduct must include such matters in their pleaded case, so that the opposing party would know the case they have to meet at trial. On its pleaded case, the respondent was counterclaiming in conspiracy to interfere with its business relations; there was no allegation of a bribe or secret profit. Therefore, even though it is not disputed that the appellant paid to Mr. Johannes, $75,000.00, the respondent led no evidence as to the purpose of that payment.
Three Rivers District Council v Governor and Company of the Bank of England [2001] UKHL 16 applied; Ramdass v Jairam and Others [2008] CCJ 6 (AJ) applied; Joseph v Mangal [2016] CCJ 22 (AJ).
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5. The Court did not find reason to interfere with the judge's finding that, a mutation was completed and a land register was issued for Parcel 314 which reflects a survey plan and that as the vendor, it was primarily the respondent's responsibility to ensure that the land it agreed to sell was with vacant possession. Furthermore, the Court found that in any event the absence of a survey plan in relation to Parcel 314 did not in any way nullify the 2019 agreement. The land to be sold was clearly identified in the schedule to the 2019 agreement.
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6. The general rule is that the successful party is entitled to their costs. The Court may in the exercise of its discretion depart from that rule. However, in the instant case, the judge did not give a reason as to why the respondent, as the successful party on the claim, was not awarded their costs. The Court found that the judge erred in the manner in which the issue of costs was treated.
Mr. Horace Fraser for the Appellant/Counter-Respondent
Mrs. Cynthia Hinkson-Ouhla for the Respondent/Counter-Appellant
The appellant, Exquisite Homes Ltd. (“Exquisite Homes”) appeals against the decision of the learned judge dated 29 th December 2022 in which the learned judge dismissed its claim against Geest Industries (Estates) Limited (“Geest”) for breach of contract and unlawful interference with contractual relations. Geest counter-appeals against the dismissal of its counterclaim against Exquisite Homes for conspiracy to injure and unlawful interference with its business.
On 16 th December 2013, Exquisite Homes and Geest entered into an agreement for the purchase of 52.6 acres of land (“Parcel 314”) which was to be dismembered from a larger parcel of land registered as Block 0642 B Parcel 261 situate at Belair, Castries, Saint Lucia, for the sum of $1,500,000.00 (“the 2013 Agreement”). The purpose for purchasing the land was to construct a housing scheme for sale to low-income earners. The appellant paid the initial deposit of $100,000.00 as required.
The appellant encountered difficulties with obtaining approval from the Development...
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