BH Riu Hotels Ltd v Barbara Johnson
| Jurisdiction | Bahamas |
| Judge | Madam Justice G. Diane Stewart |
| Judgment Date | 08 March 2022 |
| Court | Supreme Court (Bahamas) |
| Docket Number | 2019/CLE/gen/00436 |
The Hon. Madam Justice G. Diane Stewart
2019/CLE/gen/00436
IN THE SUPREME COURT
COMMON LAW AND EQUITY DIVISION
Mr. Leif Farquharson and Mr. Gabriel Brown for the Plaintiff
Ms. Rodger Outten for the Defendant
By an Amended Summons filed 12 th November 2019, the Defendant, Ms. Barbara Johnson ( the “Defendant”) seeks an order setting aside the judgment in default of appearance filed 3 rd June 2019 (the “Default Judgment”) and the subsequent writ of possession filed 17 th June 2019 (the “Writ of Possession”) obtained by the Plaintiff, BH RIU Hotels Ltd. (the “Plaintiff”) (the “Set Aside Application”).
The Set Aside Application is made pursuant to Order 2 Rules 1 and 2 and Order 13 Rules 7 and 8 of the Rules of the Supreme Court (“RSC”) and the inherent jurisdiction of the Court.
The Defendant claims that she was not served with the Writ of Summons filed 2 nd April 2019 (the “Original Writ”) but only the Amended Writ of Summons filed 24 th May 2019 (the “Amended Writ”), after the Default Judgment had been entered. As proof of service of the Original Writ is a requirement and an essential condition prior to the Default Judgment being entered pursuant to Order 13 Rules 7 and 8 of the RSC and accordingly, she is entitled to have the Default Judgment and Writ of Possession set aside ex debito justitiae because it was obtained irregularly.
The Plaintiff resists the Set Aside Application and has moved the Court to hear its application made by way of an Amended Summons filed 1 st November 2019 for an order pursuant to Order 18, rule 19 (1) (b) and/or (d) of the RSC and/or the inherent jurisdiction of the court, to strike out, in part, the Defendant's defence and counterclaim filed 29 th July 2019 (the “Defence and Counterclaim”).
More particularly, the Plaintiff seeks to strike paragraphs 2, 3 and 4 of the Defence, paragraphs 2, 4, 6, 13 and 14 of the Counterclaim and paragraphs 1, 2, 3, 4, 5 and 6 of the prayer in the Counterclaim (the “Strike Out Application”). Alternatively, the Plaintiff seeks an order pursuant to Order 14, rules 1 and/or 3 of the RSC that judgment be given in favour of the Plaintiff for the possession of the subject premises.
The grounds the Plaintiff rely on are:-
“(a) The parties were previously in the relationship of landlord and tenant; the lease of which expired on 31 st July 2017, leaving the Defendant with no legal entitlement to be replaced or remain in possession of the subject premises. This makes certain paragraphs of the Defence and Counterclaim frivolous and vexatious and/or an abuse of process.
(b) The now expired lease provided that any costs and expenditures associated with construction or remodeling of the subject premises were to be borne by the sole expense and risk of the tenant; again making certain paragraphs of the Defence and Counterclaim frivolous and vexations and/or an abuse of process.
(c) In Farrington v BH Riu Hotels Ltd Action No. 2017/CLE/gen/00436, by ruling dated 30 th July 2018, it was held with respect to the subject premises that the said lease had expired, no proprietary estoppel or other equitable interest arose in favour of the tenant, there was no entitlement for the tenant to be reimbursed for expenditures made and the tenant was to surrender the said premises to the Plaintiff. Therefore the mentioned paragraphs of the Defence and Counterclaim were to be rendered frivolous, vexatious and/or an abuse of process (the “Strike Out Application”).
By the Amended Writ, the Plaintiff claims delivery up and possession of a souvenir, food and snack shop situate at 6307 Casino Drive, Paradise Island (the “Demised Premises”) which it leased to the Defendant from 2006 at a rent of seven hundred dollars per month. To honor this arrangement, a written lease agreement dated 1 st January 2006 was executed which contained a termination date of 31 st December 2006 (the “First Lease”). There were subsequent lease arrangements entered into between the parties.
Throughout the terms of the various leases, the rent increased to one thousand two hundred and fifty seven dollars and five cents per month. The last lease agreement between the parties was entered into on 15 th November 2016 and terminated on 31 st July 2017 ( the “Final Lease”). A clause contained in the Final Lease stated that the Defendant was to yield and surrender the Demised Premises to the Plaintiff on or about 31 st July 2017. The Plaintiff refused to vacate the Demised Premises and also failed to pay the agreed rent.
The Plaintiff seeks damages for trespass in the monthly amount of one thousand two hundred and fifty seven dollars and seventy five cents from 31 st July 2017 until possession is delivered up of the Demised Premises.
After filing the Original Writ and purportedly serving it on the Defendant, the Plaintiff conducted a search on Thursday, 30 th May 2019 of both the Supreme Court Registry Cause List and the Court file. The search revealed that no appearance had been entered by the Defendant as confirmed by the Affidavit of Search filed 4 th June 2019.
Application was then made for an order for judgment in default of appearance and on 3 rt June 2019, the Default Judgment was entered and subsequently a Praecipe for Writ of Possession was filed 6 th June 2019 followed by the Writ of Possession.
By her Defence and Counterclaim, the Defendant claims that because she had been previously permitted to remain in possession of the Demised Premises upon the expiration of other written lease agreements between her and the Plaintiff, she had expected that the Final Lease would be renewed.
The Defendant also claims that there was an understanding that she would eventually be able to purchase the Demised Premises for her business which led to her making renovations to her financial detriment worth approximately three thousand dollars.
By her Counterclaim, the Defendant claims that the renovations were carried out at the encouragement of the Plaintiff as she was going to be allowed to rent it for a very long period of time and eventually purchase it. Additionally, the Plaintiff had failed to carry out any structural repairs or repairs to the electrical wiring and air condition systems over the course of the twelve year relationship in breach of the lease agreements to do so.
Accordingly, the Defendant seeks an order estopping the Plaintiff from denying the Defendant's right to reimbursement or continued possession, an order that the Defendant be allowed to continue renting the premises at the original rent and that the Demised Premises be transferred to her, a determination of the Defendant's right to recovery of her investments in the Demised Premises, damages, an order that the Defendant has a proprietary interest in the Demised Premises and not less than fifty thousand dollars in respect of the improvement of the Demised Premises.
By the Defendant's Affidavit of Delvin Hanna filed 19 th September 2019 and Karen Davis filed 19 th September 2019, the Defendant set out the events which led to a Barbara Miller instead of the Plaintiff being served with the Original Writ. Both Mr. Hanna and Ms. Davis aver that they witnessed officer Stanley Knowles serve the Original Writ on Barbara Miller despite her and other beach vendors' insistence that she was not the Plaintiff.
The Plaintiff concedes that the Original Writ was not served on the Defendant. Affidavit of Barbara Johnson filed 26 th September 2019
The Defendant avers that she co-owns Demised Premises with Naomi Farrington. On or about 1988 she began working poolside with the Plaintiff and after several years she was allowed to stay and sell her goods poolside and in its lobby to their visitors.
In late spring of 2004, she approached the Plaintiffs general manager at the time about the requirements to rent one of the stalls opposite the Hotel from which she could sell her goods and on or about 1 st June 2005 she received approval to rent the Demised Premises. They eventually executed the First Lease with a rental value of seven hundred dollars a month and subsequently executed numerous lease agreements, ending with the Final Lease.
The general manager informed them that they would be able to make improvements, provided that she obtained the Plaintiffs approval to do so. This led to the Defendant spending several thousands of dollars renovating the Demised Premises. As they had paid their rent on time, she and her business partner expected the Plaintiff to honor its obligations to maintain the Demised Premises.
A key term of every lease executed over the years was for the Plaintiff to maintain and repair the building however, year after year the Plaintiff took their money but never made the required repairs. She began to notice some obvious challenges to the space. One such challenge was that there was no access to power outlets, which led them to spend seven hundred dollars of their own money to install an electricity power line and an electrical power box.
The Defendant had informed the Plaintiffs new general manager of their lack of access to power outlets. In turn they were told that they had to obtain utilities and pay for the power connection at their own expense. After a large portion of the Demised Premises was damaged by Hurricane Irene, she also thought that the Plaintiff would replace the roof in conformity with a clause for repair of the Demised Premises if the damage sustained was through no fault of the Defendant. The Plaintiff never fixed the roof despite their repeated requests and they were still, required to pay their rent on time and in full.
Another general manager of the Plaintiff called the engineering manager in her presence to find...
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