Re Ontario Secs Commn

• Jurisdiction: Cayman Islands
• Judge: (Smellie, J.)
• Judgment Date: 26 June 1994
• Court: Grand Court (Cayman Islands)
• Date: 26 June 1994

Grand Court

(Smellie, J.)

IN THE MATTER OF THE ONTARIO SECURITIES COMMISSION

A.J. Jones for the Cayman companies;

H. St.J. Moses and Mrs. T. Escalante for the Commission;

S.T. McCann for the respondents;

W. Helfrecht, Crown Counsel, for the Attorney General.

Cases cited:

(1) Boeing Co. v. PPG Indus. Inc., [1988] 3 All E.R. 839, distinguished.

(2) Hasselbad (G.B.) Ltd. v. Orbinson, [1985] Q.B. 475; [1985] 1 All E.R. 173, followed.

(3) I.G. Farbenindustrie A.G. Agreement, In re, [1944] 1 Ch. 41; [1943] 2 All E.R. 525, dictum of Lord Greene, M.R. applied.

Legislation construed:

Confidential Relationships (Preservation) Law (Law 16 of 1976), s.3A, as added by the Confidential Relationships (Preservation) (Amendment) Law, 1979 (Law 26 of 1979), s.4: The relevant terms of this section are set out at page 136, lines 1–15.

Evidence-assistance to foreign court-setting aside order for assistance-locus standi-applicant to have legal interest in foreign proceedings or as respondents to request for assistance-mere commercial or proprietary interest not enough

Confidential Relationships-application to court for directions-locus standi-restricted by Confidential Relationships (Preservation) Law, s.3A(1) and (2) to persons intending or required to give confidential information, or parties to proceedings in which information to be given-commercial, proprietary or legal interest does not per se make interested person into party-right to intervene or be heard governed by same rules as right to apply

Civil Procedure-right to address court-discretion of court-under court”s inherent jurisdiction interested non-party may be allowed to address court-strong case if no one else in proceedings has duty to represent views of person with proprietary interest in subject-matter of proceedings

Companies registered in the Cayman Islands sought to discharge an order granting assistance to a foreign court and to intervene in an application under the Confidential Relationships (Preservation) Law, s.3A for directions pursuant to that order.

The Ontario Securities Commission had submitted letters rogatory to the Grand Court seeking the disclosure of certain confidential information to assist proceedings in Ontario. The Commission believed that some of the parties to the Ontario proceedings were the beneficial owners of companies in the Cayman Islands, and some of the persons whose evidence it wished to obtain may at some time have been officers or agents of those companies, but the companies themselves were not parties to the Ontario proceedings. The Grand Court made an ex parte order under the Evidence (Proceedings in Other Jurisdictions) (Cayman Islands) Order 1978, directing the respondents to attend to give or produce evidence and, although the respondents no longer had fiduciary obligations to the companies, the companies sought to have the order discharged.

When the respondents were required to disclose confidential information, they applied for directions under the Confidential Relationships (Preservation) Law, s.3A. The Bank in possession of the information took

a neutral stance as to what should be disclosed and the companies, having for some reason been served with notice of the application, sought to intervene with a view to preventing the disclosure of the information.

They submitted that (a) they had locus standi to seek the discharge of the order for assistance by virtue of their commercial or proprietary interest in the information sought; (b) they were entitled to intervene and be heard on the s.3A application for directions since they had been given notice of the application and were a ‘party’ to the Ontario proceedings (in the extended meaning which should be given to the word), by reason of their interest in the information sought; or (c) the court should in the alternative exercise its inherent discretion to allow them to be heard in the light of their interest since no one else involved in the proceedings had a duty to represent their views.

The Commission submitted in reply that (a) the companies had no locus standi to challenge the order for assistance as they had no legal interest in the Ontario proceedings, their commercial interest being insufficient; and (b) they were not entitled to intervene in the s.3A application for directions, as they were neither the persons required to disclose the confidential information (under s.3A(1)) nor persons to whom notice had been given who were also parties to the Ontario proceedings, their interest in the subject-matter of the application being insufficient to make them into such parties.

Held, dismissing the applications in substantial part:

(1) The companies had no locus standi to seek the discharge of the order acceding to the letters rogatory. They were themselves neither parties to the Ontario proceedings from which the letters originated nor respondents in the Cayman Islands and had no legal interest which fell to be determined in either set of proceedings. Their commercial or proprietary interest in the information sought was not a sufficient interest and accordingly they could not be heard on their summons to set the order aside (page 134, line 1 – page 135, line 18).

(2) Nor could they intervene or be heard as of right on the s.3A application. They were not within the classes of persons specified by either (a) s.3A(1) as entitled to apply for directions because they themselves (as distinct from their former officers or agents) were not the persons required to give the confidential information; or (b) s.3A(2) as persons to whom notice had been given because they were not also actual parties to ‘the proceedings in question,’i.e. the Ontario proceedings, and no interest-commercial, proprietary or even legal-could make them into such parties (page 135, line 38 – page 137, line 6).

(3) None the less, the court had an inherent jurisdiction, which was not affected by s.3A, to allow a person who was not otherwise entitled to do so to address it. It would...