2000/33B
5 pages
ROYAL COURT
(Samedi Division)
23rd February, 2000
Before: J.G.P. Wheeler, Esq., Greffier Substitute
Between 1900 Trustee Company Limited Plaintiff
And Nürnberg Company Limited as Trustee Defendant
of the Nürnberg Trust
And Richard Arthur Falle and Daniel Young Parties Cited
t/a Advocate and Solicitor in the name of
Bois & Bois
(action and counterclaim)
Application by the defendant by way of summons dated 29th September, 1999, seeking leave to file an amended answer and counterclaim.
Advocate D. Gilbert for the Plaintiff
Mr S. Schepers, a director for and on behalf of the Defendant.
JUDGMENT
THE GREFFIER SUBSTITUTE: The defendant seeks leave to file an amended answer and counterclaim which application is resisted on behalf of the plaintiff. The answer and counterclaim in question run to some 35 pages.
The procedural background to this matter is a little complicated and I therefore set it out with brief details of the actions. In May 1998, the plaintiff commenced an action by Order of Justice seeking the payment of DM 106,479 which it claimed as being due to it in respect of trustee fees and disbursements. The original Order of Justice contained interim injunctions but these were discharged by the Royal Court on 28th May, 1998. The plaintiff's claim arises from its administration of a trust established under the law of the British Virgin Islands known as the Nürnberg Trust. The plaintiff was Trustee of the Nürnberg Trust until it was replaced by the defendant in October 1997.
On 11th June, 1998, the defendant (represented at that time by Advocate C.G.P. Lakeman) filed an answer and counterclaim denying liability for the fees and counterclaiming for damages for breach of trust. It was alleged in paragraphs 12.1 and 12.2 of the answer and counterclaim that the plaintiff had failed to act as a reasonable prudent professional trustee and had failed to enhance the assets of the Trust. In its reply filed on 16th July, 1998, the plaintiff denied the breach of trust allegations.
It was apparently agreed between the parties that the defendant would provide particulars of the breach of trust allegations. This led on 20th June, 1999, to an 11 page document of particulars being filed on behalf of the defendant company. At that stage it appears that the defendant company no longer had legal representation in Jersey and the case was being handled on its behalf by Mr Stefan Schepers, who was a director.
Matters came before Advocate B.I. Le Marquand as Greffier Substitute on 15th July, 1999, in the form of two summonses:-
(a) by the defendant seeking Further and Better Particulars of the plaintiff's Order of Justice; and
(b) by the plaintiff seeking to strike out paragraphs 12.1 and 12.2 of the original answer and counterclaim filed by the defendant, or alternatively to strike out the Further and Better Particulars filed on 20th June, 1999.
At the hearing on 15th July, 1999, Advocate Le Marquand ordered that an amended Order of Justice be filed by the plaintiff, containing particulars of the fees and disbursements claimed. He also ordered the defendant to file a draft amended answer and counterclaim and to furnish a copy to the plaintiff, this to be done within 42 days of the filing of the amended Order of Justice. Either party could then apply within 28 days by summons so that the question of whether leave to file that draft amended answer and counterclaim should be granted. This is the summons which comes before me today.
As I have said, the draft answer and counterclaim run to some 35 pages. The plaintiff opposes the application by the defendant and, in particular, takes issue with a number of paragraphs in the amended document, namely paragraphs 16, 17, 23, 24, and 25.
A review of the draft amended answer and counterclaim shows that it pleads, inter alia, large tranches of foreign law, detailed matters of fact, many of which can be regarded as evidence, and covers a wide-ranging series of events and allegations. I have to say that it is not easy to identify from the pleading itself exactly what are the specific alleged breaches of trust committed by the plaintiff. The whole subject is undoubtedly complicated but it appears to have become even more complicated by the nature of the pleading. As I have previously indicated, the plaintiff takes issue with the defendant on substantial parts of the draft amended answer and counterclaim.
Rule 6/8 of the Royal Court Rules, 1992, deals with the mode of pleadings in actions which come before the Royal Court. Rule 6/8(1) is in the following terms:-
"Subject to the provisions of this Rule, every pleading must contain, and contain only, a statement in a summary form of the material facts on which the party pleading relies for his claim or defence, as the case may be, but not the evidence by which those facts are to be proved, and the statement must be as brief as the nature of the case admits."
I would also mention Rule 6/8(6) which provides that a party may by his pleadings raise any point of law.
In essence, the plaintiff's objection to the draft amended answer and counterclaim is that in its present form it may prejudice, embarrass or delay the fair trial of the action. This is, of course, one of the grounds on which a pleading may be struck out under Rule 6/13 of the Royal Court Rules, 1992.
Guidance on the matter may be found in the Supreme Court Practice 1999 ("the White Book"), especially in paragraph 18/19/17. The beginning of that paragraph is in the following terms:-
" "Tend to prejudice, embarrass, or delay the fair trial of the action." The Court is "disposed to give a liberal interpretation" to these words (Berdan v. Greenwood (1878) 3 Ex.D.251 at 256). At the same time parties must not be too ready to find themselves embarrassed. "The rule that the Court is not to dictate to parties how they should frame their case, is one that ought always to be preserved sacred. But that rule is, of course, subject to this modification and limitation, that the parties must not offend against the rules of pleading which have been laid down by the law; if a party introduces a pleading which is unnecessary, and it tends to prejudice, embarrass, and delay the trial of the action, it then becomes a pleading which is beyond his right." (per Bowen L.J. in Knowles v. Roberts (1888) 38 Ch. D.263 at 270)."
Later on in the same paragraph it is stated:-
"It is no part of the defendant's duty to reform the plaintiff's pleading; but if wholly immaterial matter may be set out in such a way that the applicant must plead to it, and so to raise irrelevant issues which may involve expense, trouble, and delay, then the irrelevant matter will be struck out, as it will prejudice the fair trial of the action. (See Rassam v. Budge [1983] 1 Q.B. 571; Liardet v. Hammond Electric Light Co. (1883) 31 W.R. 710; and Mudge v. Penge U.D.C. (1916) 85 L.J. Ch.814, CA; 32 T.L.R. 354 at 417; but see London, Mayor, etc. of v. Horner (1914) 111 L.T. 512, CA). So a mass of evidence pleaded unnecessarily may be struck out (Davy v. Garrett (1878) 7 ChD 473)"
It is also helpful to refer to the written judgment delivered by Advocate Le Marquand in respect of the hearing held on 15th July, 1999, to which I have previously referred.
At the bottom of page 2 of his judgment, Advocate Le Marquand says:-
"Although the claim contained in the Order of Justice is relatively straightforward being a claim for fees and disbursements, the answer and counterclaim, if correctly drafted, will be very complicated and will contain complicated allegations of breach of trust and a claim for a sum in excess of £11 million by way of damages. The answer and counterclaim ought to be pleaded most carefully and precisely by a senior Jersey Lawyer who specialises in Trust Litigation or by an English Barrister who specialises in Trust Litigation."
He reiterates his concern on page 4 of the judgment when he explains the reason for the decisions which he made.
In considering the present application, I have decided that it is not appropriate for me to consider and review individual paragraphs in the draft amended answer and counterclaim to examine whether they meet the rules of pleading which apply and to which all parties are subject. Instead I have looked at the draft pleading as a whole and I have taken into account the principles to which I have previously referred. Having done so, I consider that the draft pleading does infringe the requirements of Rule 6/8 of the Royal Court Rules, 1992, and the principles as enunciated in the White Book to which I have referred. In its present form I consider that the pleading would prejudice, embarrass or delay the fair trial of the action. Accordingly, I order as follows:-
(1) that the application by the defendant for leave to file an amended answer and counterclaim in the form of the draft before me is refused; and
(2) that the defendant shall file an amended answer and counterclaim in proper form within 28 days.
I also take the opportunity to echo the sentiments expressed by Advocate Le Marquand in his judgment of 15th July 1999 and particularly the need for the defendant to seek expert legal advice on what is a complicated matter.
Having heard the parties on the subject I also order that the defendant pay the costs of the plaintiff of this application on the standard basis.
Authorities.
Royal Court Rules 1992, as amended: Rule 6/8.
Supreme Court Practice (1999 Ed'n): 18/19/17.