John Oliver Dyrud v Palmavon Jasamin Webster
| Jurisdiction | Anguilla |
| Judge | Farara JA |
| Judgment Date | 27 April 2022 |
| Judgment citation (vLex) | [2022] ECSC J0427-1 |
| Docket Number | AXAHCVAP2021/0010 |
| Court | Court of Appeal (Anguilla) |
THE EASTERN CARIBBEAN SUPREME COURT
IN THE COURT OF APPEAL
The Hon. Mde. Louise Esther Blenman Justice of Appeal
The Hon. Mr. Mario Michel Justice of Appeal
The Hon. Mr. Gerard Farara, QC Justice of Appeal [Ag.]
AXAHCVAP2021/0010
AXAHCVAP2021/0011
Ms. Jean M. Dyer and Ms. Liska Hutchinson for the Appellant/Respondent John Dyrud
Mrs. Tana'ania Small-Davis QC for the Respondent/Appellant Palmavon Jasamin Webster
Interlocutory appeal — Section 268 of the Companies Act of Anguilla — Judicial discretion — Overriding objective of the Civil Procedure Rules 2000 — Part 26 of the Civil Procedure Rules 2000 — Appeal against case management orders of trial judge — Expert evidence — Part 32 of the Civil Procedure Rules 2000 — Failure to comply with Part 32 of the Civil Procedure Rules 2000 — Delay in application for appointment of expert witness — Delay in trial dates as a result of late application for appointment of expert witness — Impartiality and independence of expert witness — Whether expert evidence was necessary to determine the matter justly — Whether learned judge erred in refusing to appoint named expert witnesses — Whether learned judge had discretion to make order for the appointment of expert witness in the absence of a live application by the parties — Whether decision to make order for the appointment of expert witness was wrong for failure to consider factual and legal issues to be determined — Whether learned judge had discretion to order amendment and filing of supplemental witness statement — Costs
Mr. John Oliver Dyrud (“Mr. Dyrud”) and Ms. Palmavon Jasamin Webster (“Ms. Webster”) are 50/50 shareholders of the second respondent, First Anguilla Trust Company Limited (“FATCL”), a licensed trust and company management entity incorporated under the laws of Anguilla. Mr. Dyrud was at all material times the managing director of FATCL and Ms. Webster, a non-executive director. In November 2018, Ms. Webster brought a claim against Mr. Dyrud seeking certain relief under section 268 of the Companies Act of Anguilla (“the Companies Act”) on the basis that the affairs of FATCL have been, are being, or are likely to be conducted in a manner oppressive or unfairly discriminatory or unfairly prejudicial to her in her capacity as a member of FATCL. She also claimed that the business and affairs of FATCL were conducted as a quasi-partnership from the inception of the company until 31 st December 2006 when the quasi-partnership ended. In her amended claim form, Ms. Webster sought orders including that her shareholding in FATCL be bought-out by Mr. Dyrud or/and FATCL, the price of such buy-out to be determined by a professional valuer as at certain alternative dates, such valuer to be agreed by the parties by a certain date, failing which, the court shall direct the appointment of a valuer from a short list to be provided by the parties, directions for the terms and criteria to be used for the valuation including the costs of the valuation, and interest on the price of the share buy-out (“the section 268 Claim”).
At the first case management conference in December 2020, the parties were ordered to file and exchange witness statements on or before 26 th February 2021, which witness statements shall stand as examination-in-chief. The parties were also granted liberty to apply for further directions and orders, such applications to be made on or before 19 th March 2021 (“the December 2020 CMC Order”). No sanction was imposed by this order for failure to comply. A further case management conference was fixed for 25 th March 2021 and the trial date, to be determined by the court in 2021.
Pursuant to the December 2020 CMC Order, Ms. Webster filed the witness statement of Mr. Christopher Horne (“Mr. Horne”) on 26 th February 2021 which included matters of expert opinion on such matters as the financial statements of FATCL and his purported valuation of the shares in FATCL (“the Horne Witness Statement”). No permission had been sought or granted for Mr. Horne to be appointed as an expert witness to assist the court with expert opinion on any issue in the proceedings.
On 15 th June 2021, almost three months beyond the time frame stipulated by the December 2020 CMC Order, Ms. Webster filed an application in which she sought, pursuant to rules 26.1(2)(k) and (w) and 32.6 of the Civil Procedure Rules 2000 (“CPR”) an extension of time to 15 th June 2021 to file an application for the appointment of experts; orders deeming Mr. Horne an expert in the field of accountancy, including financial reporting, auditing, forensic accounting, corporate finance, and accounting systems and processes and valuation of a company for the purpose of sale; an order permitting Ms. Webster to rely at trial on the Horne Witness Statement and/or an expert report that he may provide; and an order permitting Ms. Webster to call Mr. Johnny Law (“Mr. Law”) at trial as an expert witness in the field of corporate secretarial governance and trust company management and compliance (“the Webster Application”). Ms. Webster urged that the trial court would benefit from the expert evidence of Mr. Horne in respect of the valuation of the shares in FACTL and that he had the expertise required to undertake the analysis of the audited accounts of FACTL and to provide an opinion as to the interpretation of the said accounts and the conclusions that may be drawn therefrom. In respect of Mr. Law, she averred that he had extensive experience in corporate governance and, as such, he was qualified to assist the court in understanding all the corporate governance issues both from a regulatory and practical point of view. She also contended that the court's determination of the issues of oppression, unfair prejudice and unfair discrimination will be assisted by the evidence of the experts concerning the manner in which FACTL's governance, administration and financial affairs were conducted by Mr. Dyrud and its impact, if any, on the value of the company.
On 11 th October 2021, the learned judge delivered his decision on the Webster Application (“the Judgment”). The learned judge summarised at paragraph 4 of the Judgment, the seven issues which arose for his consideration. After analyzing the facts and submissions, the learned judge found that Mr. Horne lacked the impartiality and independence necessary of an expert witness as his interests went beyond mere familiarity with the litigation and the parties. He accordingly found that Mr. Horne ought not to be permitted to give expert evidence at the trial. The learned judge also found that the Horne Witness Statement did not conform with CPR 32.14 and that this failure to comply with the rule meant that it could not stand as an expert report. As it relates to the areas in which Ms. Webster sought to have Mr. Law give evidence, the learned judge was of the view that those areas brought into play the provisions of section 97 of the Companies Act dealing with the duty of care to be exercised by directors of a company, and are matters best left to be determined by the court as matters of fact and law.
He held that the issues identified in the section 268 Claim involved questions of fact and law which the court was well placed to determine having regard to the Companies Act, the Company's By-Laws, the Resolutions passed by FATCL, and other documentary and oral evidence. The learned judge was of the view that the only issues which require the court to receive assistance by way of expert evidence was in respect of which of the remedies provided for by section 268(2) of the Companies Act is better suited to meet the exigencies of the relationship of the parties within the corporate context, and if the remedy contemplated by section 268(2)(a) is desirable in the circumstances, the methodology to be used in determining the value of Ms. Webster's shareholdings in FATCL and the time at which the valuation is to be determined. However, the learned judge ultimately only ordered expert evidence in the area of the valuation of Ms. Webster's shares in FATCL and the time at which such valuation is properly to be made.
The learned judge dismissed the application for an extension of time to apply to the court for the appointment of the named experts and for permission to rely on their respective witness statements and or expert reports (the Webster Application) at paragraph 105(1) of his judgment. The learned judge then, in reliance of his purported discretion under CPR 32.9, ordered at paragraphs 105(2) to (6) that the parties agree on the appointment of one expert in relation to the valuation of the shares in FATCL and made other consequential directions and orders pertaining to the obtaining and deployment at trial of such expert evidence, and awarded costs of the Webster Application to Mr. Dyrud at paragraph 105 (7).
Upon the oral application of Ms. Webster, the learned judge: (1) ordered that the Horne Witness Statement l be redacted so as to exclude all matters and expressions of expert opinion contained therein; (2) granted leave to Ms. Webster to file and serve a supplemental witness statement of Mr. Horne within 10 days; (3) granted leave to Mr. Dyrud to file a supplemental witness statement within 7 days of the date of service by Ms. Webster of the supplemental witness statement of Mr. Horne; (4) ordered that any objections to a supplemental witness statement filed by the parties be taken at the trial; (5) fixed new trial dates for the 6 th to 8 th December 2021; and (6) ordered trial bundles to be filed in accordance with CPR 39.1 (“the Order”).
Dissatisfied with the Judgment and the Order, Mr. Dyrud appealed against paragraphs 105(2)...
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