First Caribbeaninternational Bank (Barbados) Ltd v Desron Paul

• Jurisdiction: St Vincent and the Grenadines
• Judge: ‘Henry, J.’
• Judgment Date: 27 April 2022
• Judgment citation (vLex): [2022] ECSC J0427-2
• Docket Number: SVGHCV2020/0113
• Year: 2022
• Court: High Court (Saint Vincent and the Grenadines)

THE EASTERN CARIBBEAN SUPREME COURT

IN THE HIGH COURT OF JUSTICE

Before:

The Hon. Mde. Justice Esco L. Henry High Court Judge

SVGHCV2020/0113

Between

First Caribbeaninternational Bank (Barbados) Ltd.

Claimant

and

Desron Paul

Defendant

Appearances:

Mr. Jadric Cummings for the claimant.

Defendant unrepresented, absent.

BACKGROUND

‘Henry, J.’

1 First Caribbean International Bank (Barbados) Ltd. (the bank) carries on banking business as a licensed financial institution in Saint Vincent and the Grenadines. It alleged that Mr. Desron Paul borrowed over $200,000.00 from it in 2008 secured by a mortgage of property he owns at Yambou. The bank claims that Mr. Paul has defaulted on repayment of the loan. It seeks an order from the court for possession of, and immediate access to the mortgaged property and the costs of bringing this claim. Mr. Paul presented no defence. He filed no documents and did not attend court. Judgement is entered for the bank.

ISSUES

2 The issuesare:

• (1) Whether Mr. Desron Paul is liable to the bank in respect of the referenced mortgage loan? and

• (2) To what remedies is the bank entitled?

ANALYSIS

Issue 1 – Is Desron Paulliable to the bank in respect of the referenced mortgage loan?

3 Mr. Desron Paul took no part in these proceedings. The bank secured an order from the court to serve pleadings and other documentation on him by depositing originals at the court office for retrieval by him. The bank provided evidence 1 that the Fixed Date Claim Form, the statement of claim, affidavits containing its testimony and notice of the date set for the hearing were served on Mr. Paul. The court also directed 2 that notice of the hearing date be given to Mr. Paul by advance publication in a local newspaper. This was done.

4 I am satisfied that the several publications in the local newspapers of notice of the commencement of proceedings and the date set for the summary trial would have provided ample opportunity for Mr. Paul to retrieve all necessary pleadings and other documentation from the court office. He was also afforded adequate notice of the hearing date.

5 The bank's evidence was adduced through its Analyst Ms. Celine Coward. Ms. Coward's testimony is largely outlined in her affidavit filed on 28 ^th March 2022. The contents were admitted into evidence along with the documents relied on which were produced collectively as ‘ex. CC1’. Her account was credible and corroborated by the documentary evidence. In the premises, the court

accepts itin its entirety as being factual and probative of the matters under consideration, no contrary position having been advanced or being discernible from the factual matrix supplied

6 It emerged that Mr. Paul successfully applied to the bank for a mortgage loan of $225,000.00. He surrendered title to his property (registered by Deed of Conveyance 5105 of 2006 3) at Yambou as security for the loan. An interest rate of 8% per annum was agreed by the parties and applied to the loan. The bank executed a mortgage over that property by Deed of Mortgage No. 4056 of 2008 4. Ms. Coward exhibited copies of both deeds. They were produced into evidence along with the corresponding facility letter outlining the terms of the mortgage.

7 The mortgaged property is described in the Schedule to the Deeds as:-

‘ALL THAT lot piece or parcel of land situate at Yambou in the Parish of Charlotte in the State of Saint Vincent and the Grenadines formerly admeasuring Seven Thousand Five Hundred (7,500) Square Feet but by recent survey admeasuring Seven Thousand Five Hundred and Nine (7,509) Square Feet as delineated and described in a registered Survey Drawing prepared by Colin Alexander Licensed Land Surveyor and approved and lodged in the Lands and Surveys Office on the 20 ^th day of October 2006 bearing No. C16/52 and is butted and bounded on the NORTH by a proposed Road on or towards the SOUTHby lands of one Isaac on or towards the EAST by remaining lands of Ruth Frank and on or towards the WEST by a 20' road or howsoever otherwise the same may be butted bounded known distinguished or described …’

8 By paragraph 8 of the mortgage deed, the parties agreed that the bank would be granted a power of sale over the mortgaged property and would be able to invoke it in on the occurrence of any of three specified events. The first such circumstance would involve the service on Mr. Paul of a demand notice by the bank to pay off the mortgage loan or any outstanding balance, coupled with non-payment by himfor the succeeding 3-month period, of the full amount. The second would arise if Mr. Paul defaulted in the payment of interest, as a consequence of which arrears accumulated and remain unpaid for four weeks thereafter. The third scenario would arise by any breach by Mr.

Paul of any other term of the mortgage agreement. The agreement stipulated that the purchase price realized on the exercise of such power of sale is to be applied first towards the expenses associated with effecting the sale, and the rest towards discharging the mortgage debt with any remainder to be paid to Mr. Paul

9 Mr. Paul agreed to repay the mortgage loan by monthly payments. He failed to do so consistently. As a result, he was sent a demand letter from the bank (authored by its lawyers 5) dated March 8 ^th 2018 for payment of the full balance which at that time was $208,128.94 6, comprising the principal of $152,901.57, arrears of $54,351.20, and interest of $55,227.37. He has not satisfied the debt.

10 As at 1 ^st February 2022, the outstanding balance on the mortgage had increased to$282,131.13 and attracted a daily interest rate of $38.38. Of that sum, the principal balance amounted to $175,143.55 and the interest due and owingwas $106,987.58. Mr. Paul had by then made 101 payments totaling $155,884.67. He made his last payment of $800.00 towards the debt on February 1 ^st 2018.

11 Ms. Coward averred that this case does not require that notice be given to any person because of a registered interest under the Matrimonial Causes Act. It is also a matter of record that no third party has made any such representation to the court.

12 Ms. Coward's testimony was clear and unequivocal. I believe her. I am satisfied that Mr. Paul remains indebted to the bank in the sum of $282,131.13 and that a daily interest of $38.38 is accruing. I also accept Ms. Coward's account that the principal and interest components of the debt are $175,143.55 and $106,987.58respectively. I find on a balance of probabilities that Mr. Paul is liable to the bank for those sums together with interest on the principal sum at the rate of 8% per annum.

Issue 2 – To what remedies is the Bank of Nova Scotia entitled?

13 The bank submitted that a legal mortgage entitles the mortgagee as against the mortgagor to immediate possession or receipt of the rents and profits at any time after execution of a mortgage. Citing Four-Maids Ltd. v Dudley Marshall (Properties) Ltd. 7 and Halsbury's Laws of England 8, the bank submitted that it is entitled to go into possession of the mortgaged property even if there is no default. It reasoned that by virtue of Mr. Paul's default of his repayment obligations, it is entitled to exercise its power of sale.

14 The bank submitted further that it was necessary for it to obtain a court order to secure possession of the mortgaged property. It relied on the decisions in Ropaigealach v Barclays Bank Plc 9 and Birmingham Citizens Permanent Building Society v Caunt 10 and pronouncements by the learned authors of Halsbury's Laws of England 11 as authorities for the proposition that a mortgagee may by reasonable force take possession of mortgaged property and treat the mortgagor as a trespasser....