Reserve Mgmt v Branch Banking
| Jurisdiction | Cayman Islands |
| Judge | (Jones, J.) |
| Judgment Date | 29 June 2010 |
| Date | 29 June 2010 |
| Court | Grand Court (Cayman Islands) |
(Jones, J.)
K.J. Farrow, Q.C. for the second defendant;
A. Akiwumi for the investment manager;
S.R. Folpp for the liquidators;
The plaintiff and the first defendant did not appear and were not represented.
(1) Kirkconnell v. Cook-Bodden, 1996 CILR 326, referred to.
(2) Lawrie v. LeesELR(1881), 7 App. Cas. 19, dicta of Lord Penzance applied.
(3) R. v. Cripps, ex p. Muldoon, [1984] Q.B. 686; [1984] 3 W.L.R. 53; [1984] 2 All E.R. 705, dicta of Donaldson, M.R. applied.
(4) Swire, In re, Mellor v. SwireELR(1885), 30 Ch. D. 239, dicta of Lindley, L.J. applied.
(5) Thynne v. Thynne, [1955] P. 272; [1955] 3 W.L.R. 465; [1955] 3 All E.R. 129, applied.
(6) Woods v. Francis, 1988–89 CILR 298, referred to.
Grand Court Rules 1995, O.20, r.11: The relevant terms of this rule are set out in para. 7.
Civil Procedure-judgments and orders-correction of errors-under Grand Court Rules, O.20, r.11 or inherent jurisdiction, court may correct inadvertent failure to express decision as intended, e.g. by deleting irrelevant and incorrect bank account numbers, but may not reconsider substance-may correct order even if perfected
The plaintiff”s investment manager brought an action seeking to recover money owed to the plaintiff by the defendants.
The defendant banks held funds to the credit of the plaintiff. On discovering that the plaintiff had entered liquidation in the British Virgin Islands, the second defendant unilaterally moved the funds it held from the plaintiff”s Cayman bank account into a suspense account maintained in New York, in order to avoid repaying the money inadvertently. The plaintiff”s liquidators sought an order recognizing them as the only parties having the right to act on behalf of the plaintiff in the Cayman Islands.
The Grand Court (Jones, J.) made a declaration that the plaintiff”s liquidators were recognized in the Cayman Islands as the only persons having authority to act on behalf of the plaintiff fund. Nonetheless, the investment manager brought actions in the Cayman Islands and in New York seeking repayment of the sums held by the defendants, which, faced with conflicting instructions from the investment manager and the liquidators, took out interpleader summonses.
The Grand Court (Jones, J.) made an anti-suit injunction against the investment manager, and ordered that the defendants each pay the plaintiff the amounts owing on the instructions of the liquidators, not the investment manager. In the order, the amounts to be paid to the plaintiff were identified as standing in the original Cayman bank accounts, which were identified by their numbers. The order was then perfected (signed, sealed and filed). It subsequently came to light that the second defendant had moved the funds it held into a suspense account, and therefore the order was inaccurate.
The liquidators applied to the Court of Appeal (Quin, Ag. J.A.) for an adjournment of proceedings in order to seek to amend the order, which was granted (in proceedings noted at 2010 (1) CILR N [12]).
The liquidators applied to amend the order to the effect that the defendants be required to pay the sums due, without identifying the relevant bank accounts, on the instructions of the liquidators, submitting that (a) the order contained a factual error that gave rise to ambiguity, and did not reflect the court”s manifest intention; (b) the order could therefore be amended pursuant to the Grand Court Rules, O.20, r.11 as the error arose from an ‘accidental slip or omission’; (c) the fact that the order had been perfected did not remove the court”s jurisdiction to amend; and (d) in the alternative, the court could amend the order pursuant to its inherent jurisdiction.
The court considered the scope of its jurisdiction to amend a perfected order.
Held, amending the order:
The court could amend the order pursuant to O.20, r.11 of the Grand Court Rules, notwithstanding that it had been perfected. Its jurisdiction under O.20, r.11 extended to the correction of an inadvertent failure to express the decision as intended, and was not restricted to mere typographical errors-although the court had no jurisdiction to reconsider the substance of its decision. Furthermore, the fact that an order had been perfected did not deprive it of jurisdiction to correct its own records, which under O.20, r.11 it could do ‘at any time.’ In the event that this was not the correct interpretation of O.20, r.11, the court would also be able to amend such an order under its inherent jurisdiction. Since the errors in the original order were an inadvertent failure to identify the location of the funds correctly, rather than reflecting the court”s substantive decision-which was that the defendants be required to pay the sums due on the instructions of the liquidators-and since the errors had given rise to ambiguity, the order would be amended to reflect clearly the court”s actual intention that the defendants be required to pay the sums due, without identifying the relevant bank accounts from which they were to be paid (paras. 11–14; para. 19).
1 JONES, J.: On April 13th, 2010, I ordered, inter alia, that Branch Banking and Trust Company (‘BB&T’) and Société Générale each pay the sum of US$10m. plus interest then due and owing to Reserve Intl. Liquidity Fund Ltd. (‘the fund’) on the instructions of Mr. Walker and Mr. Carter in their capacity as its official liquidators. The order was perfected (signed, sealed and filed) on the same day that it was made, but my written reasons for that order were not issued until April 19th. In the meantime, on April 16th, Société Générale”s attorneys wrote a letter addressed to me, with copies to the parties, for the purpose of informing the court and the parties that a statement contained in an affidavit sworn on behalf of Société Générale by Mr. Tipton, its managing director and general counsel...
To continue reading
Request your trial