Between Hilary Shenika Frederick First Appellant/ First Plaintiff v Monica Veronica Smith Second Appellant / Second Plaintiff and Christobel Pathra Smith Respondent/Defendant

• Jurisdiction: Cayman Islands
• Judge: Sir Michael Birt, JA,Beatson JA,Goldring P
• Judgment Date: 29 August 2024
• Docket Number: CICA (Civil) APPEAL No. 0010 of 2023
• Court: Court of Appeal (Cayman Islands)

Between

Hilary Shenika Frederick

First Appellant/ First Plaintiff

and

Monica Veronica Smith

Second Appellant / Second Plaintiff

and

Christobel Pathra Smith

Respondent/Defendant

Before:

The Rt. Hon Sir John Goldring, President

The Hon. Sir Michael Birt, Justice of Appeal

The Rt. Hon. Sir Jack Beatson, Justice of Appeal

CICA (Civil) APPEAL No. 0010 of 2023

FORMERLY CAUSE NO. GC088 of 2022

IN THE CAYMAN ISLANDS COURT OF APPEAL

ON APPEAL FROM THE GRAND COURT OF THE CAYMAN ISLANDS CIVIL DIVISION

Appearances:

Mr Clayton Phuran for the Appellants / Plaintiffs

Mr Philip Ebanks for the Respondent / Defendant

Sir Michael Birt, JA

1 This is an appeal from a judgment of Walters J (Acting) (“the judge”) dated 27 April 2023 (“the Judgment”) whereby he dismissed the claim of the Plaintiffs for a declaration that a transfer of land executed on 18 December 2012 was valid and that the Land Register should be rectified accordingly. The Plaintiffs now appeal.

Factual background

2 The essential factual background was not in dispute, so much so that the evidence before the judge consisted entirely of affidavit evidence; there was no oral evidence.

3 The dispute between the parties relates to a property registered in the Cayman Islands Land Register (“the Land Register”) as West Bay Northwest, Block 4B, Parcel 322 (“the Property”). The Property was formerly owned by Olice Estermae Smith (“the Deceased”), who was the mother of the Second Appellant (to whom I shall refer as the “Second Plaintiff”) and of the Respondent (to whom I shall refer as “the Defendant”), who are sisters.

4 The First Appellant (to whom I shall refer as the “First Plaintiff”) is the daughter of the Second Plaintiff and, accordingly, the granddaughter of the Deceased and the niece of the Defendant. She resides at the Property with her 8 year old son, her younger sister Claudia and Claudia's 1 year old daughter, the Second Plaintiff and the Second Plaintiff's partner. I should add that the ages are those stated in the writ of summons dated 21 April 2022 and will have increased by now. The First Plaintiff states that she was born in the Property and has lived there all of her life, which was some 29 years at the date of her affidavit in November 2022. The Second Plaintiff has also apparently lived at the Property for most of her life. The Defendant has her own home where she has lived for many years.

5 The Deceased also resided at the Property until shortly before her death. On 18 June 2012, the Deceased and the First Plaintiff executed a form RL1 (being the statutory form for transfer of land) by which the Deceased purported to transfer title to the Property from her sole name into the names of herself and the First Plaintiff (“the Transfer”). It was witnessed by a Justice of the Peace and retained by the First Plaintiff. However, she did not register the Transfer in the Land Register as is required in order to transfer title. The First Plaintiff was 18 at the date of execution of the Transfer.

6 Form RL1 is a printed form which leaves spaces for various parts to be completed in manuscript. I set out below the relevant part of the Transfer as completed in this case. Those words which are in ordinary type represent the pre-prepared parts of the form and the wording in italics represents the manuscript wording inserted by the First Plaintiff and the Deceased. Having described the title to the Property, the Transfer goes on as follows:

“I Olis Esther Mae Smith

In consideration of natural love and affection for my granddaughter (The receipt whereof is hereby acknowledged) HEREBY TRANSFER

To Olis Esther Mae Smith and Hilary Shenika Frederick

Of West Bay PO. General Delivery KY1-1300

The land comprised in the above mentioned title.

The Transferees declare that they hold the combined / undivided share(s) as proprietors in common in the following undivided shares:

(or as Joint Proprietors)”

The Transfer is then signed by the Deceased as transferor and by the Deceased and the First Plaintiff as transferees, with the signatures being witnessed by the Justice of the Peace.

7 As can be seen, the parties did not, as they should have, delete one or other of the sections specifying whether the Property was to be held by the transferees as proprietors in common or as joint proprietors.

8 The Judgment records that the First Plaintiff stated in her affidavit that, initially in conjunction with the Deceased, she was responsible for the upkeep of the Property. Since the death of the Deceased, she has been the sole person responsible for its upkeep. She thought that, once her grandmother signed the Transfer, the Property belonged to both of them. After the death of the Deceased, she borrowed money by way of a loan from a bank and did renovations to the house. By the time she realised she needed to get the Transfer registered in the Land Register, the penalties for late filing would have been very high and she could not afford them.

9 The Deceased died intestate on 25 December 2015. Her estate falls to be divided equally between the Second Plaintiff and the Defendant as her two children. Letters of administration were granted to the Defendant on 6 November 2020 and she was registered in the Land Register as proprietor of the Property in her capacity as administratrix of the estate of the Deceased on 20 January 2021.

10 On 19 February 2021, the Defendant served eviction notices on the Plaintiffs, Claudia and the Second Plaintiff's partner requiring them to vacate the Property within 30 days. The Plaintiffs then instituted proceedings (GC Cause 53 of 2021) seeking injunctions restraining the Defendant from approaching the Property or evicting or interfering with the Plaintiffs. These were granted ex parte on 19 March 2021, but were subsequently discharged on 21 February 2022 against mutual undertakings by the Plaintiffs and the Defendant which effectively preserved the status quo as to occupation of the Property pending resolution of these proceedings.

The proceedings before the Grand Court

11 The proceedings were begun by the Plaintiffs on 21 April 2022. The issues before the Grand Court were whether the Transfer was a valid transfer although it was not registered in the Land Register pursuant to the Registered Land Act (2018 Revision) (“the Act”) and/or whether the Deceased had done all she needed to do to transfer title to the Property so that a gift of the equitable title was complete.. As well as seeking a ruling on the validity of the Transfer, the Plaintiffs sought the removal of the Defendant as administratrix of the estate. However, this aspect does not appear to have been pursued at the trial as it is not mentioned in the Judgment, nor has it been raised on appeal. I shall therefore say no more about it.

12 In his original skeleton argument on behalf of the Plaintiffs before the Grand Court, Mr Phuran referred to the well-known dictum of Turner LJ in Milroy v Lord (1862) 4 De G. F & J 264 at 274 where he said:

“I take the law of this Court to be well-settled, that, in order to render a voluntary settlement valid and effectual, the settler must have done everything which, according to the nature of the property comprised in the settlement, was necessary to be done in order to transfer the property and render the settlement binding upon him. He may of course do this by actually transferring the property to the persons for whom he intends to provide, and the provision will then be effectual. And it will be equally effectual if he transfers the property to a trustee for the purposes of the settlement, or declares that he himself holds it in trust for these purposes; and if the property be personal, the trust may, as I apprehend, be declared either in writing or by parol; but, in order to render the settlement binding, one or other of these modes must, as I understand the law of this Court, be resorted to, for there is no equity in this Court to perfect an imperfect gift. The cases I think go further to this extent, that if the settlement is intended to be effectuated by one of the modes to which I have referred, the Court will not give effect to it by applying another of those modes. If it is intended to take effect by transfer, the Court will not hold the intended transfer to operate as a declaration of trust, for then every imperfect instrument would be made effectual by being converted into a perfect trust.”

13 Mr Phuran accepted (at the second para 7 of his original skeleton) that equity will not perfect an imperfect gift and, for the gift to be valid, the donor must have done everything that according to the nature of the gift, was necessary to have been done by him in order to transfer the property. He submitted that in this case the Deceased had done all that was necessary to be done by her. She had signed the Transfer and handed it to the First Plaintiff who could thereafter register it in the Land Register at any time.

14 Mr Ebanks, on behalf of the Defendant, in his original skeleton before the Grand Court, referred to the Canadian case of MacLeod v Montgomery Estate [1979] A.J. No. 857 and submitted that, in order for everything to be done which was necessary, the Transfer had to be registered in the Land Register as required by the Act. In the absence of registration, there was an incomplete gift which the court could not perfect.

15 In MacLeod, the transferor executed a transfer of land by way of gift in favour of her granddaughter (subject to reservation of a life interest) and handed the transfer document to the granddaughter. The position in relation to title to land in Alberta appears to have been not dissimilar to the position under the Act in that the transfer document needed to be registered in order to transfer title. Thus section 56 of the Land Transfer Act, RSA, 1970 provided (so far as relevant):

“56. After a certificate of title has been...