Suncoast East No. 2 Inc. et Al v Riva et Al
| Jurisdiction | Bahamas |
| Judge | Hayton, A.J. |
| Judgment Date | 17 July 2000 |
| Court | Supreme Court (Bahamas) |
| Docket Number | 1048 of 1998 |
| Date | 17 July 2000 |
Supreme Court
Hayton, A.J.
1048 of 1998
Mr. Michael Scott, Mr. Stephen Turnquest and Ms. Jasmine Jones for the plaintiffs.
Mrs. Krystal Rolle for Third defendant.
Practice and procedure - Service out of jurisdiction — Application for leave to service writ out of jurisdiction — Whether the third defendant is entitled to order for (1) the discharge of an order pursuant to Order 11, r 4 giving leave to issue and serve writ of summons out of jurisdiction on the third defendant (2) the writ and summons to be set aside because they were not personally served on the third defendant (3) all subsequent proceedings against the third including judgment in default of appearance to be set aside.
By summons tiled on 17 April 2000 the third defendant seeks an Order pursuant to Order 12, rule 7 that
- the Order of 21 October 1998 as amended and re-amended on 22 and 28 October 1998 giving the plaintiffs leave to issue a Concurrent Writ of Summons and to serve Notice of the Concurrent Writ of Summons on the Third defendant out of the jurisdiction be discharged; 2. the Writ of Summons, the Concurrent Writ of Summons and service of the Notice of the Concurrent Writ of Summons be set aside against the Third defendant as not having been personally served on him; and 3. all subsequent proceedings herein as against the Third defendant, including the Judgment in Default of Appearance of 23 December 1998, be set aside.
At the hearing of this Summons the grant of leave to serve out of the jurisdiction is reconsidered afresh: see The English Supreme Court Practice 1999 at 11 / 1 /2.
By order of the Registrar on 6 April 2000 an extension of time had been granted for this Summons to be filed. I heard the Summons on 12 July 2000 and granted the third defendant the requested Order concerning the first and third reliefs, the plaintiffs to pay the third defendant's costs in the proceedings. Because some matters of general importance arose, I reserved giving my reasoned judgment, but, to save further appearances before me, at the plaintiff's counsel's request, (concerned with possible implications for other defendants) I gave leave to appeal in case my written judgment may be considered to raise any grounds for appeal.
Should the Summons be adjourned? No.
It transpired that due to conflicting affidavit evidence as to personal service of the relevant legal documents upon the third defendant, the plaintiffs had present for giving oral evidence the Miami Dade process server, Mr. Cranston Freeney, for the better contradiction of paragraph 44 of the third defendant's affidavit filed on 4 July 2000 denying personal service. Counsel for the third defendant was prepared to permit this in the absence of the third defendant believing her case to be a strong one, irrespective of the personal service issue.
Counsel for the plaintiffs sought an opportunity to have an adjourned hearing at which the third defendant could be cross-examined on many parts of his affidavit or the opportunity for an adjournment to respond in an affidavit to deal in detail with the third defendant's affidavit.
I rejected affording the plaintiffs such opportunities for this would involve something of a trial before the trial of the action (see Viscount Dilhorne in Derby v. Larsson [1976] 1 W.L.R. 202 at p.203). In my view, the plaintiffs had to justify their actions on the basis of the currently available affidavit evidence supported by Mr. Freeney's oral evidence. If they failed then it would, in my opinion, be open to them to file a statement of claim (in support of their writ of 21 October 1998) which, if it clearly linked the third defendant to specific allegations, might then justify making an application (supported by a further affidavit) to serve proceedings on the third defendant out of the jurisdiction, but subject to problems under Order 11, r. 4(2). Support for the propositions in this paragraph is to be found in The English Supreme Court Practice 1999 at 11/4/16.
Were the legal documents duly personally served on the Third defendant on 3 November 1998? Yes.
In Exhibit “CDC3” to the affidavit of Ms Cheryl Denise Cartwright (filed on 17 December 1998) is the “Return of Service Affidavit” of Mr. Cranston Freeney, a duly authorised process ser-t in Miami Dade, stating that he served the Third defendant with the relevant legal documents at 2601 South Bayshore Drive, #1775, Coconut Grove, Florida on 3 November 1998 at 10:48 a.m. This is denied by the third defendant in para 44 where he states the first document received relevant to these Bahamian proceedings was the Notice of Assessment of Damages, received on 23 March 2000.
To effect personal service the server must first satisfy himself that he has found the correct person. Mr. Freeney's evidence was that he attended the above address, suite 75 of floor 17, believed to be the office where the third defendant worked, and identified himself as a process server to the young lady at a desk behind the counter and asked to see Mr. Bernard Werner, the third defendant, so he could personally serve him with the relevant legal documents. She said she was authorised as his secretary to receive service for him. Mr. Freeney said he must personally serve Mr. Werner so she went in search of Mr. Werner, going down a hallway and into an office off it. She returned, saying Mr. Werner was taking a conference call nn the telephone. Mr. Freeney said that he would wait for it to finish. A minute or so later the secretary went back to the office and then signalled to Mr. Freeney that he could come to the office to see Mr. Werner, despite the conference call. As he entered the office, he saw Mr. Werner sitting behind his desk and upon the secretary saying ‘Mr. Werner”, Mr. Werner held up his hand to acknowledge the presence of Mr. Freeney and the secretary. Mr. Freeney then read the style of the case heading but, because Mr. Werner was busy on the phone call and did not speak to him, Mr. Freeney gave the legal documents to Mr. Werner's secretary.
In the above circumstances, I hold that Mr. Freeney found Mr. Werner but did not actually hand to, or leave with, Mr. Werner himself the legal documents. However, I find it more likely than not that Mr. Werner knew the nature of the documents left with his apparent secretary in his office. In the circumstances, leaving the documents with her was to leave them as nearly in Mr. Werner's possession or control as Mr. Freeney could. Thus, personal service was effected upon the third defendant, although in circumstances where some ambiguity existed which the third defendant has tried to exploit in his own favour, faced with actions against himself on two fronts, first in Florida and then in the Bahamas, both, essentially, relating to the same matter.
The background to proceedings in Florida and The Bahamas
The plaintiffs are Florida companies that were vehicles for investing over ten million US dollars on behalf of a group of Dutch investors interested in condominium or redevelopment schemes in Florida. The first three defendant individuals (all resident in Florida) are alleged in conjunction with the fourth, fifth and sixth defendants (all Florida limited partnerships) to have caused about nine million dollars to be lost by virtue of their negligent and fraudulent conduct in Florida.
The seventh defendant is a duly licensed Bahamian Bank, while the eighth defendant is a Bahamian International Business Company serving as a holding vehicle for the first defendant's Galena Condominium.
While much has come to light in pursuing substantive proceedings in Florida, the plaintiffs had to issue substantive proceedings in The Bahamas in order to obtain a Mareva freezing injunction restraining the first six defendants and the eighth defendant from disposing of any Bahamian assets in their names or subject to their direction up to the value of 9,640,000 US dollars, and also to obtain ancillary information from the seventh defendant.
Under the current state of Bahamian law the lack of jurisdiction to grant freezing orders in support of foreign proceedings has led to ingenuity in framing a Bahamian substantive action in the hope that it will be sufficient to support such freezing orders. It may, for example, be possible to allege conspiracy against a Bahamian entity set up to facilitate wrongdoing conduct of defendants overseas or to allege that a transfer to a Bahamian entity by defendants overseas can be set aside as a fraudulent transfer or to allege that a Bahamian entity holds assets on constructive trust for the plaintiff.
However, it is still necessary to obtain leave to serve the overseas defendants under Order 11, r.4 of The Bahamian Supreme Court Rules.
Does the court have jurisdiction under Order 11, rules 1(j) and 4(1) to grant leave to serve the third defendant out of the jurisdiction? No.
By Order 11, rule 4
“(1) An application for the grant of leave…. must be supported by an affidavit stating the grounds on which the application is made and that, in the deponent's belief, the plaintiff has a good cause of action, and showing in what place or country the defendant is, or probably may be found.
(2) No such leave shall be granted unless it shall be made sufficiently to appear to the court that the case is a proper one for service out of the jurisdiction under this Order.”
I should mention that the more recent English Order 11, r.4 adds to the three requirements in (1) a fourth requirement where under the English rule 1(1)(c) (“the claim is brought against a person duly served within or out of the jurisdiction and a person out of the jurisdiction is a necessary or proper party thereto”). In such a case the fourth requirement is that the affidavit must state “(d)… the...
To continue reading
Request your trial