Hazel-Dawn Hewlett v (1) Richard Peters; (2) Richard Parsons; (3) Lewis S. Hunte; (4) Leonard Birmingham; (5) Sheila George; (6) Kieron O'Rourke; (7) Peter Tarn; (8) Philip Kite
| Jurisdiction | British Virgin Islands |
| Judgment Date | 09 December 2004 |
| Date | 09 December 2004 |
| Docket Number | BVIHCV2003/0110 |
| Court | High Court (British Virgin Islands) |
IN THE HIGH COURT OF JUSTICE
BVIHCV2003/0110
Mr. J.S. Archibald Q.C. for the Claimant, Sydney A. Bennet, Q.C. and Michelle Matthew with him.
Mr. Gerard St. C. Farara Q.C. for the Defendants, Mrs. Tana'ania Small-Davis with him.
Mrs. Hazel-Dawn Hewlett was a partner in Harney Westwood & Riegels (Harneys), said to be the largest law firm in common law Caribbean jurisdictions. She became a partner on 1 st January 1991. She ceased being a partner on 29 th November 2002. She says the other partners, the defendants, wrongfully expelled her in breach of the specific terms of the partnership agreement. She claims nearly six million dollars in damages for breach of contract.
The defendants deny that they expelled the claimant. They say they dissolved the partnership. They say the terms upon which she relies were never part of any partnership agreement. They deny that she is entitled to damages for breach of contract. They say they have paid her over a million dollars which is all, they say, she was entitled to.
There is only a little dispute about the facts surrounding the claimant's leaving. A majority of the eight other partners resolved that she should go. Immediately. She says nobody ever warned her of a complaint. The merits of the majority's decision and the justification for their course of action were not relevant, on the pleadings, to any issue in the case. Hence, I steered counsel away from these matters to ensure that Mrs. Hewlett's professional reputation did not get dragged needlessly into these proceedings. That course seemed perfectly innocuous.
The fact is that on 28 th November 2002 the first defendant, Mr. Richard Peters, went to the claimant's office and told her that a majority of the partners wanted her to leave. She was shocked and amazed. She said she asked for specifics of the allegations against her and was given none. Mr. Peters offered her a meeting with the partners who had pushed for her to leave. She said she declined such a meeting as it would have been too embarrassing for her.
The following day, 29 th November 2002, the claimant went to the office. She discovered that she was excluded from the computer network. She met with Mr. Peters and with the eighth defendant, Mr. Kite. She was given a sheet of paper showing an accounting of what was due to her. She was told that she should choose which of two e-mails was to be circulated to staff: that she had resigned or that she had ceased to be a partner with immediate effect. She did not choose. So the defendants sent out the message that she had ceased being a partner.
On that day the claimant was paid US$ 601,682.40 being the value of her capital entitlement calculated in accordance with the terms of their agreement, according to the defendants. She was subsequently paid US$ 329,587 being the value placed upon her shares in HWR Services Ltd., an ancillary company and US$40,383.39 being the value of the claimant's interest in the London branch of the partnership, according to the defendants. In their closing skeleton arguments the defendants say they have paid the claimant a total of $1,021,589.98.
The Claim Form states that the claim is for (i) a declaration that the partnership has been dissolved by the claimant's acceptance of the defendants' repudiatory breach of contract; (ii) alternatively, dissolution by the court by reason of the defendants' repudiatory breach of the partnership agreement; (iii) damages for breach of contract; and (iv) accounts and inquiries.
Much turns on the pleadings so the substance of the Statement of Claim is set out in some detail. Paragraph 5 of the Statement of Claim contains the following averments:
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a. The terms of partnership are contained in a document purporting to be an Agreement made in 1993 (the Document);
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b. The first named defendant explained the terms of the partnership to the claimant at a pre-partnership meeting in 1990;
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c. He represented that these terms had been set out in an unexecuted agreement
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d. Upon being admitted to the partnership the claimant was handed a copy of the Document;
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e. She verified that the terms set out in the Document were the same as had been explained to her;
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f. Minor revisions were made in 1993 and subsequently;
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g. The Document has always been held out as containing the terms of the partnership;
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h. There has never been any alteration or revision of provisions concerning retirement, termination or dissolution.
I treat as part of the Statement of Claim the Further Information (it used to be called Particulars) of the holding out that the claimant provided upon request. I summarize this information in the remainder of this paragraph. The holding out of the Document began with a 1990 meeting when the claimant says she asked Mr. Peters, the first defendant, if there was a partnership agreement and he told her there was a draft partnership agreement (the Agreement) which although not signed represented the heads of agreement and terms upon which the partnership operated. Mr. Peters discussed certain terms of the Agreement with the claimant. (The terms are fully stated in the Further Information.) Mr. Peters indicated that certain decisions, including expulsion, required the unanimous resolution of the partners. Shortly after her admission in January 1991 the claimant reminded Mr. Peters of his promise to let her have a copy of the Agreement. Mr. Peters produced the Agreement and the claimant recognized it contained in substance what had been represented to her in December 1990. The Further Information told of other conduct on which the claimant relied over the years. As this material formed the substance of the claimant's evidence there is no need to set it out here.
In paragraph 6 of the Statement of Claim it is stated, alternatively, that the fact that the terms of the partnership are as set out in the Document is evidenced by the conduct of the parties. The assertion is that the affairs of the partnership have at all times been conducted in accordance with the provisions and stipulations contained in the Document.
In paragraph 7 the claimant stated, further, the defendants are estopped from contending that the terms of the partnership are other than as set out in the Document because on several occasions the defendants represented orally and in writing that the basis of the partnership was the terms set out in the Document.
The bedrock of the pleaded case of the Claimant is paragraph 8 of the Statement of Claim, which quotes the provisions of the document as to compulsory retirement. This reads as follows:
‘(e) Retirement vote
In the event that the disciplinary committee shall be of the opinion that any active partner shall have:
(i) Failed to fulfill his obligations and duties as a partner;
(ii) Acted in breach of this agreement;
(iii) Brought the partnership into disrepute;
(iv) Acted in a grossly negligent and unprofessional manner in the performance of his duties;
(v) Acted in a manner intended to disrupt the affairs of the partnership.
The senior partner shall serve notice on the partner concerned setting forth the allegations giving rise to the opinion of the disciplinary committee and shall invite the said partner to attend before a special meeting of the partners to answer the said allegations. Only after the said partner has had an opportunity to respond to the allegations, and all partners shall have been made aware of the allegations and the said partner's response thereto shall a retirement vote be put to his fellow partners. A retirement vote shall require a unanimous resolution.
‘The entitlements arising by way of salary, and from the active points of any partner who is the subject of a retirement vote shall cease at the end of the month immediately following such vote and such partner shall be deemed to have retired on due notice at the end of the calendar year.’
The Claimant pleaded in paragraph 9 that on 28 th November 2002, Mr. Richard Peters told the Claimant that a majority of the partners had taken a decision to expel her from the partnership with immediate effect. She pleaded that the purported expulsion was in breach of the terms of the partnership agreement and constituted a repudiation of the same and gave full particulars in four sub-paragraphs of the manner in which the actions of the Defendants breached the terms of the partnership agreement. Later in this judgment I will set out the precise language that she pleaded. The Claimant stated that she accepted the repudiation.
By reason of the stated matters, the Claimant alleged, she suffered loss and damage, which she particularized in detail. She pleaded loss of income for a period of 16 years and one month from the date of her wrongful expulsion, which would have taken her up to her 65 th birthday. That would have yielded a minimum aggregate income of $3,474,000.
She pleaded loss of pension rights based upon contributions made by the partnership on behalf of the Claimant to the partnership pension fund of no less than $694,800. She pleaded loss of profit representing the amount over and above her monthly drawings that she received which she said was no less than $100,000 per year. That would have aggregated to at least $1,608,333.
In the alternative, she pleaded she suffered loss of reputation including within the legal profession and otherwise, and in particular in having to disclose the circumstances of the termination of her relationship to prospective employers. Further or alternatively, she claimed damages for career disruption and in...
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