Delaporte Point Ltd v King Enterprises Ltd

• Jurisdiction: Bahamas
• Judge: Charles Snr. J
• Judgment Date: 29 November 2022
• Court: Supreme Court (Bahamas)
• Docket Number: 2016/CLE/gen/01346

Between

Delaporte Point Limited

Plaintiff

and

(1) King Enterprises Limited

First Defendant

and

Leonette Ferguson

Second Defendant

BS 2022 SC 153

Before:

The Honourable Madam Senior Justice Indra H. Charles

2016/CLE/gen/01346

IN THE SUPREME COURT

Common Law & Equity Division

Costs — Summons of Plaintiff to declare Second Defendant owner of Unit dismissed — Second Defendant has appealed Judgment — Dispute as to who is the successful party

Both Defendants alleged that they are the owners of a Unit situate within the Delaporte Point Community. As management fees on the Unit were owed (and are still owing), the Plaintiff sued both Defendants. On 21 July 2017, the Court entered a Judgment on Admission against the First Defendant in the presence of the Second Defendant. The Judgment on Admission remained wholly unsatisfied. The Plaintiff proceeded to have a Receiver appointed to sell the Unit with a view to liquidating the debt owed. A Receiver was appointed and, in the process of selling the Unit, the Second Defendant intervened asserting ownership of the Unit. As a result, on 6 May 2019, the Plaintiff filed a Summons seeking (i) to reinstate the Second Defendant to the action; (ii) to declare her the legal and beneficial owner of the Unit and (iii) Judgment to be entered against her for the full amount owed to the Plaintiff for outstanding management fees. On 15 July 2019, the Court heard the first limb of the application and reinstated the Second Defendant to the action. The Second Defendant did not appeal that decision. Directions were given for the hearing of the remaining two issues.

In a written Judgment delivered on 24 August 2022, the Court dismissed the Plaintiff's Summons filed on 6 May 2019 to declare the Second Defendant the owner of the Unit and reinstated the Judgment on Admission, extending the time for the First Defendant to comply with the 21 July 2017 Order failing which the Receiver would be at liberty to sell the Unit. The issue of costs on the Summons was reserved.

The parties are now before me to determine who is entitled to costs as the successful party. As I understand it, both parties claim to be the successful party: the Second Defendant says that the Plaintiff's Summons was misconceived and hence, dismissed. On the other hand, the Plaintiff says that it got what it wanted: for the Court to determine the ownership of the Unit which was at the root of the action. The Plaintiff further stated that the Second Defendant lost her bid for the Court to declare her the owner of the Unit. In short, she was unsuccessful.

The Second Defendant has since appealed the Judgment. She seeks, in paragraph 7 of her Notice of Appeal an Order that (1) the Judgment be set aside in its entirety, or alternatively, in part; (2) the appeal be allowed….” She further submitted that the Court should not give any consideration to the fact that she has appealed the entirety of the Judgment.

HELD: Finding that the Plaintiff is the successful party in the action and ordering that the Second Defendant do pay costs to the Plaintiff be taxed if not agreed

• 1. Notwithstanding that part of the Plaintiff's Summons filed on 6 May 2019 to declare the Second Defendant the owner of the Unit was dismissed, the Plaintiff got what it wanted and, therefore, was the successful party in the action.

• 2. A critical issue which arose at the trial was for the Court to determine the ownership of the Unit. The Second Defendant was unsuccessful in her bid to be declared the owner of the Unit.

• 3. The Second Defendant's allegation that the Plaintiff's Summons was misconceived and that the Plaintiff wasted precious judicial time and caused unnecessary costs to be incurred cannot be supported by the evidence. On the contrary, it was the Second Defendant who inserted herself in this action and prevented the Receiver from selling the Unit. Had she not done so, there would have been no need for the Plaintiff to re-approach the Court seeking, among other things, an Order that she be declared the owner of the Unit. In fact, that was the very Order that she was seeking but failed in her attempt to persuade the Court to do so.

• 4. The Second Defendant has appealed the Judgment and has asked the Court of Appeal to set aside the Judgment in its entirety or, alternatively, in part; that the action be held dismissed against her with costs. Only unsuccessful parties appeal judgments in their entirety or call for a dismissal of the action.

• 5. The general rule is, where the issue of costs arises, the Court will award costs on a party to party basis. The Court does so in the judicial exercise of its discretion and would only depart from this well-established principle when there are exceptional circumstances for doing so.

• 6. An award for indemnity costs can be made in exceptional cases where the conduct of a party can be considered egregious or disgraceful or exceptional or deserving of moral condemnation. The fact that the Second Defendant fought hard to be declared the owner of the Unit does not make her conduct egregious or disgraceful or exceptional or deserving of moral condemnation: Levine v Callenders & Co. et al [1998] BHS J. No. 75 per Sawyer CJ.

• 7. Costs are awarded to the Plaintiff on a party to party basis. Costs are to be taxed if not agreed.

Appearances:

Mrs. Eugeina Butler of Providence Law for the Plaintiff

Mr. Oscar O. Johnson KC with him Mr. Keith Major Jr. of Higgs & Johnson for the Second Defendant

The First Defendant not participating as a result of a Judgment on Admission already entered against the Company on 21 July 2017

RULING

Charles Snr. J

Introduction

1 By Summons filed on 6 May 2019, the Plaintiff (“Delaporte”), a company which carries on the business of the management of all matters related to the Delaporte Point Condominiums, sought (i) a Declaration to reinstate the Second Defendant (“Ms. Ferguson”) to the action; (ii) a Declaration that Ms. Ferguson is the legal and beneficial owner of the Unit and (iii) Judgment to be entered against Ms. Ferguson for the outstanding management fees, accumulated interest and costs.

2 At the heart of the dispute was whether Ms. Ferguson owns Unit H-9B (“the Unit”) located in Delaporte in the Western District of New Providence.

3 The Court heard the Summons and, on 24 August 2022, delivered a written Judgment (“the Judgment”) in this matter. The Court concluded that:

• 1. Delaporte's Summons filed 6 May 2019 to declare Ms. Ferguson to be the owner of Unit No. H-9B (“the Unit”) located within the Delaporte Point Community situate in the Western District of the island of New Providence, one of the islands of the Commonwealth of The Bahamas is dismissed.

• 2. Judgment on Admission entered against King Enterprises Limited in favour of Delaporte Point Limited on 21 July 2017 and filed on 27 July 2017 in the sum of $61,184.64 (and continuing), interest at the statutory rate of 6.25% from 21 July 2017 to the date of payment and costs of $8,000.

• 3. King Enterprises is to comply with paragraph 2 of this Order by 31 October 2022 failing which the Receiver is at liberty to sell the Unit. A Penal Notice is to be affixed to this Order and;

• 4. The issue of costs on this Summons is reserved. Both parties will submit written submissions by 15 September 2022.

4 For reasons which will become clearer in this Ruling, I find, notwithstanding that Delaporte's application to declare Ms. Ferguson the owner of the Unit was dismissed (which was only part of the Order made by the Court), Delaporte was the successful party in this action in that the Court reaffirmed that King Enterprises was the true owner of the Unit and the Receiver is at liberty to sell the Unit. Delaporte is entitled to its costs to be taxed if not agreed. It is not entitled to indemnity costs.

Procedural history

5 The procedural history is worth narrating again as it will give a better perspective of the determination of the sole issue which is before me: who is the successful party to be awarded their costs.

6 By a Specially Indorsed Writ of Summons filed on 14 September 2016, Delaporte seeks from both Defendants (both of whom claim to be the owner of the Unit), the payment of management fees on the Unit assessed as at 5 September 2016 to be in the sum of $36,849.19 as well as unrestricted access to it to effect necessary repairs so that it does not negatively impact the adjoining units and the entire Condominium community as a whole.

7 The crux of Delaporte's allegation was that (i) King Enterprises is the owner of record of the Unit and still asserts that it is the rightful owner and (ii) Ms. Ferguson claims to be the current owner of the Unit and has produced a copy of an unstamped and unrecorded conveyance executed by the President and Director of King Enterprises.

8 On 25 October 2016, the Defendants filed a Joint Defence. At paragraph 2, they admit that King Enterprises is the owner of record of the Unit. At paragraph 3, the Defendants neither admit nor deny Ms. Ferguson's allegation that she is the current owner save to the extent of confirming that she has advanced funds to King Enterprises in respect of the Unit, as authorized by its beneficial owner. Thereafter, they neither admit nor deny most of the allegations in the Statement of Claim and put Delaporte to strict proof of them.

9 Delaporte filed a Reply to Defence on 30 November 2016 and, before the matter came up for Case Management Conference, Delaporte filed an application on 20 February 2017 seeking Summary Judgment against both Defendants for the principal sum of $52,682.43, interest and costs. Delaporte also sought an order that it be allowed unrestricted access to the Unit to effect necessary repairs in order to prevent the risk of electrical, fire or flooding.

10 On 21 July 2017, in the presence of Ms. Ferguson, King Enterprises, through its Counsel, admitted the judgment debt (“Judgment on...