Ormiston Arnold Boyea Hudson Willliams Claimants v Eastern Caribbean Flour Mills Ltd Defendant [ECSC]
| Jurisdiction | St Vincent and the Grenadines |
| Judge | Thom J |
| Judgment Date | 27 September 2006 |
| Judgment citation (vLex) | [2006] ECSC J0927-2 |
| Court | High Court (Saint Vincent) |
| Docket Number | HIGH COURT CLAIM NOS. 211 AND 212 OF 1998 |
| Date | 27 September 2006 |
EASTERN CARIBBEAN SUPREME COURT
IN THE HIGH COURT OF JUSTICE
HIGH COURT CLAIM NOS. 211 AND 212 OF 1998
This is a claim for wrongful dismissal. The Defendants have counterclaimed for damages for breach of contractual and fiduciary duties.
During the cross-examination of the Claimant Ormiston Boyea objection was made by the Claimants to certain documents which were disclosed by the Defendants. Several hundreds of documents have been disclosed by the parties in this case. Learned Queen's Counsel Mr. Bennett for the Claimants informed the Court that the Claimants intended to object to several of the Defendant's documents. The Court decided to hear all of the arguments on admissibiiity of documents before further cross-examination of the Claimant Ormiston Boyea.
The Claimants objected to the following documents:
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(a) The Report of Mr. Karl Hudson Phillips Q.C.
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(b) The KPMG report and the witness statement of Mr. James McAuley.
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(c) Documents in support of issues not arising on the pleadings.
The Claimants' grounds of objections were stated as follows:
(a) Hearsay
(b) — Ultimate issue for the Judge to determine
— Irrelevance
— Failure to observe the rules of natural justice
— Private Injury
(c) Non— impartiality of the proposed expert
(d) Matters not in issue on the pleadings.
Learned Queen's Counsel for the Defendant Mr. Gale submitted that the application should be dismissed for the following reasons:
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(a) Delay in making the application in relation to the KPMG report.
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(b) The Court has no jurisdiction to exclude admissible evidence
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(c) Impartiality goes to weight not to admissibility
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(d) Matters found to be hearsay or irrelevant could be excluded at the time of considering the judgment.
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(e) Whether an issue arises on the pleadings must be determined not only on the pleadings but also on the witness statements and the documents disclosed.
I will consider first the submission dealing with delay since if I agree with the submission of the Defendant there would be no need for me to consider the other submissions.
Learned Queen's Counsel for the Defendant Mr. Gale submitted that there has been substantial delay in making the application and the application ought to be dismissed. Learned Queen's Counsel referred the Court to an order made by Justice Cenac on February 6, 1998 for both parties to adduce expert evidence of accountants. A similar order was made at Case Management on the 3rd April 2003. The KPMG report was served on the Claimants since September 23,2003 in keeping with the terms of the Order.
Learned Queens' Counsel referred the Court to the case ofliverpool Roman Catholic Archdiocesan Trustees Incorporated V David Goldberg [2001] Lloyd's Rep P.N. 518., the decision of Justice Neuberger where he outlined the approach that should be taken by the Court when considering application to exclude expert evidence. Learned Queen's Counsel submitted the Defendant was relying on the fifth consideration which reads:
"In principle it seems to me that if there is real doubt as to whether or not expert evidence ought to be put in as admissible, the issue should be determined in favour of admissibility…"
Learned Queen's Counsel also referred the Court to CPR Part 11.3 (1) which reads:
"So far as is practicable all applications relating to pending proceedings must be listed for hearing at a case management conference or pre— trial review."
Learned Queen's Counsel further submitted that to exclude the KPMG Report at this stage the trial having commenced would adversely affect the Defendant's case since the report forms a substantial basis for proof by the Defendant of matters both in the defence and counterclaim.
Learned Queen's Counsel Mr. Bennett for the Claimants submitted in response that the application should have been made at Case Management. CPR 32.4 requires that the application to call expert evidence must name the expert to be called and there was no such application made before the court naming Mr. McAuley or KPMG as an expert. Had the Defendant named KPMG or Mr. McAuley in the application at Case Management the Claimants would have objected. Further if the report is inadmissible for non— compliancewith procedural requirements or because of improper or irrelevant content or hearsay it does not become admissible because objection is made at a late stage.
I agree with the submission of Learned Queen's Counsel Mr. Gale that the application is made very late. Whilst it is correct that neither Mr. McAuley nor KPMG were named in the Order made at Case Management, the Claimants received the report and had it in their possession for almost three years prior to trial. They were therefore fully aware that the Defendant's expert was Mr. McAuley Senior Vice President of KPMG Forensic Inc.
However if an expert report contains hearsay or irrelevant matters then the fact that the application to exclude such matters is late should not preclude the Court from excluding them. The same applies to documents that are inadmissible because they are irrelevant.
Further CPR 2000 Part 11.3 (2) gives the Court a discretion to hear an application at trial which should have been made before trial. Part 11.3 (2) reads as follows:
"If an application is made which could have been dealt with at case management conference or at pre— trial review the court must order the applicant to pay the costs of the application unless there are special circumstances."
In view of the above I will not dismiss the application on the ground of delay.
The Defendant included in their list of documents a report prepared by Mr. Karl Hudson Philips Q.C. in relation to the business affairs of the Defendant. The report states that Mr. Karl Hudson Phillips was engaged by the Government of St. Vincent and the Grenadines to examine, analyze and advise on all matters pertaining to the proposed acquisition of additional shares by the Government in the Defendant. Maple Leaf Mills Ltd owned forty percent (40%) of the shares of the Defendant, Phillip Veira Investment Ltd owned thirty— six and one quarter percent (361/4%); three and three quarters percent were held by local shareholders with the voting rights held by PH Veira, and twenty percent (20%) held by the Government of St. Vincent and the Grenadines. The report shows that Mr. Karl Hudson Phillips Q.C interviewed persons. It is not disputed that he did not interview either of the Claimants. It is also not disputed that the Report was the result of a private inquiry.
Learned Queen's Counsel Dr. Archibald for the Claimants submitted that the Hudson Phillips report is inadmissible on the following grounds:
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•Ultimate issue was for the Judge to determine
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•Irrelevance
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•Failure to observe the rules of natural justice
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•Private inquiry
Leaned Queen's Counsel referred the Court to the case ofThree Rivers District Council and others V Bank of England No 3 [2001] 2 AER p. 513, the judgment of Lord Hope of Craighead at paragraphs 31-33 where whilst dealing with the Report of Lord Brigham Lord Hope said:
Paragraph 31:
"The first point that has to be borne in mind is that neither the Report itself nor any of its findings or conclusions will be admissible at any trial in this case."
At Paragraph 32:
"the investigation which Brigham LJ conducted was a private and not a statutory inquiry
And at paragraph 33:
"A further point that should be noted at this stage about the findings and conclusions in the Brigham report is that they were the result of an investigation that lacked the benefit of statutory powers and was conducted behind closed doors. The Claimants were not present nor were they represented. In the conduct of this fact finding exercise Brigham LJ was as he said in his covering letter greatly assisted by the co— operation which he received especially from the Bank and Price Waterhouse, But he had no power to compel the attendance of witnesses or to require the production of documents and there was no Counsel."
Learned Queen's Counsel also referred the Court to the case ofSavings and Investment Bank Ltd v Gesco Investments (Netherlands) BV and others [1984] 1AER p. 296 where the Court held:
"A report of inspectors appointed under ss 165 and 172 of the Companies Act 1948 to investigate the affairs and ownership of a company contains only opinionsand is inadmissible as evidence in Court proceedings save for the limited purpose of winding up proceedings brought by the Secretary of State or by a person for whose protection the inspectors were appointed in which case the Court is permitted to treat the report not as evidence in the ordinary case but as material on which it can make a winding up order if that material is not challenged by proper evidence. Furthermore even if the inspector's inquiry contained in their report are referred to in an affidavit sworn for the purposes of being used in interlocutory proceedings such references to the inspectors opinions may be struck out under Order 41 r. 6 as being references to evidence which is otherwise inadmissible and therefore irrelevant."
Learned Counsel submitted that like the Brigham Report the Hudson Phillips Report contained findings of facts, it was a private inquiry, the Claimants were not present nor were they represented. Learned Queens' Counsel further submitted that the report was commissioned not by the Defendant, but by a shareholder of the Defendant. The Board of Directors of the Defendant noted several inaccuracies in the findings of fact in the report as outlined in the minutes of the meeting after Board of Directors of the Defendant held on April 24,1995.
Learned Queen's Counsel for the Defendant Mr....
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