Jersey Unreported Judgments

[2011]JRC205

Royal Court

(Samedi)

24 October 2011

Advocate N. S. H. Benest for the Plaintiffs.

Advocate M. L. Preston for the Defendants.

judgment

the bailiff:

1.        This is an application by the plaintiffs for Norwich Pharmacal Relief against the first and second defendants.  The matter initially came before me as an ex parte application but, as Advocate Benest has outlined to us this afternoon, I declined to grant the relief sought ex parte as I could see no good reason for proceeding in that way.  The defendants are reputable trust companies and in my judgment there was no risk of documents being removed or destroyed by reason of the matter being heard inter partes and there was no other possible prejudice which Advocate Benest was able to point to.  Accordingly the matter now comes before the Court on an inter partes basis. 

2.        The matter was also originally against only the first defendant, but following discussions between the plaintiffs and the first defendant, the second defendant was by consent added as a second defendant. 

3.        The background, as it emerges from the order of justice and affidavit sworn in support, is as follows. 

4.        The plaintiffs carry on insurance business in the Isle of Man; the first plaintiff is a subsidiary of the second plaintiff.  At the material time a Mr Ralph Brunswick was a director and also chief executive of the plaintiffs.  His employment ceased in June 2006.  He is said, whilst chief executive, to have stolen some £499,830 from one or other of the plaintiffs.  It is said that Mrs Brunswick was in knowing receipt of these funds as they were paid into a joint account in the Isle of Man in the names of Mr and Mrs Brunswick.

5.        The Avalon Trust was created in October 1995.  Mr and Mrs Brunswick and their children and remoter issue were beneficiaries.  The second defendant was the trustee of the Avalon Trust from its creation until 2000 when it appears that a company called The Professional Trust Company Limited was appointed as trustee in its place.  The trust appears to have been terminated on 22^nd May, 2006, when it would seem that all the assets in the trust were appointed to Mrs Brunswick.  The first defendant acquired The Professional Trust Company Limited shortly afterwards in June 2006 and the business of The Professional Trust Company Limited was subsequently integrated into that of the first defendant.  The first defendant was never actually trustee of the Avalon Trust but it now holds the documents and records in relation to the trust which were previously held by The Professional Trust Company Limited. 

6.        The plaintiffs have brought legal proceedings in the High Court in Birmingham against Mr and Mrs Brunswick and against Mr Brunswick's trustee in bankruptcy.  Evidence has been placed before us to suggest that some of the stolen money may have been paid into the Avalon Trust and may subsequently have been distributed to Mrs Brunswick upon termination of the trust in 2006.  Furthermore she is said to have paid these monies to the trustee in bankruptcy in order to secure her husband's release from bankruptcy.  Accordingly there is a proprietary claim in the Birmingham proceedings against the trustee in bankruptcy.  The plaintiffs now seek disclosure of documents and information held by the defendants in relation to the Avalon Trust in order to confirm whether the facts which we have described above are so. 

7.        In order to grant Norwich Pharmacal Relief the Court must be satisfied of three things:-

(i)        That there is a good arguable case that the plaintiff has been the victim of wrongdoing;

(ii)       There is a good arguable case that the defendant was innocently mixed up in that wrongdoing; and

(iii)      As a matter of discretion that it is in the interests of justice for the defendant to make disclosure. 

The leading authority in Jersey is Macdoel Investments Limited and Others-v-Federal Republic of Brazil and Others [2007] JLR 201. 

8.        The Court is quite satisfied from the evidence before it that there is a good arguable case that Mr Brunswick has stolen the sum of £499,830 from one or other of the plaintiffs and that, accordingly, the plaintiffs are the victim of wrongdoing.  The Court is also satisfied that there is a good arguable case that the trustee at the time of the Avalon Trust became innocently mixed up in this wrongdoing because some of the stolen funds were paid to the Avalon Trust. 

9.        The defendants have been served with these proceedings and have not appeared, although they have written a letter explaining that there are no funds in the trust and they rest on the wisdom of the Court.  In the circumstances the Court is in no doubt that it would be in the interests of justice to order disclosure of the various trust records, so as to ascertain what monies have been paid in and paid out of the trust.

10.      In the circumstances we grant the relief sought in the terms of the prayer of the order of justice. 

11.      We note that there is an undertaking, in the amended order of justice, that the plaintiffs will pay the costs of the proceedings as a whole. 

Authorities

Norwich Pharmacal Co-v-Customs and Excise Commissioners [1974] AC 133.

Macdoel Investments Limited and Others-v-Federal Republic of Brazil and Others [2007] JLR 201.