Lake Development Company Ltd Appellant v Shell Antilles & Guianas Ltd Respondent

• Jurisdiction: British Virgin Islands
• Court: Court of Appeal (British Virgin Islands)
• Judge: BISHOP, J.A.
• Judgment Date: 17 January 1986
• Neutral Citation: VG 1986 CA 3
• Judgment citation (vLex): [1986] ECSC J0117-1
• Docket Number: CIVIL APPEAL NO. 10 of 1985
• Date: 17 January 1986

[1986] ECSC J0117-1

IN THE COURT OF APPEAL

Before:

The Hon. Mr. Justice Robotham-Chief Justice

The Honourable Mr. Justice Bishop

The Honourable Mr. Justice Moe

CIVIL APPEAL NO. 10 of 1985

Between:

Lake Development Co. Ltd

Appellant

and

Shell Antilles & Guianas Ltd

Respondent

Appearances:

Dr. F. Ramsahoye, Q.C, and E.A. Hewlett for Appellant

J.S. Archibald, Q.C., and Janice Creque for Respondent

BISHOP, J.A.

1 This is an appeal against the refusal of the learned trial judge to grant an application for an interim injunction. The appeal is brought on behalf of Lake Development Company Limited, a company duly registered under the Laws of the British Virgin Islands and carrying on business at Road Town, Tortola. That company sought an order restraining Shell Antilles and Guianas Limited, a company registered in England, and carrying on business in Tortola (with its office at Fish Bay), its servants and or agents and persons claiming by or through the said company from "entering or remaining upon or conducting with any person other than the Defendant on the premises at Lower Estate, Road Town, Tortola, comprising by admeasurement 0.514 acres and used as a Shell Service Station, from changing and or keeping changed any locks used by the Plaintiff on the premises whether on the buildings and erections thereon or on the petrol pumps thereon or on any other place on the said premises whatsoever, from taking any measures concerning the storage and sale of petrol and petroleum products other than these in use by the Plaintiff immediately before the 1st November 1985, free bringing to an end the supply of petrol and petroleum products to the Plaintiff in pursuance of the agreement made between the Plaintiff and the Defendant on the 1st February 1983, and from doing any act or thing to prevent the free use and enjoyment of the said premises by the Plaintiff and the carrying on of the business of a Shell Service Station thereon until after the hearing and determination of a Summons to continue this Order….."

2 The ex parte application was by way of affidavit sworn by Patsy Lake, of John's Hole, a director of Lake Development Company Limited (also hereinafter called the Company), on the 1st November, 1985.

3 Also filed at the same time as the application was a Writ of endorsed with a claim for damages for breach of an agreement made en the 1st February, 1983, by which Shell Antilles and Guiannas Limited (also called Shell) granted a licence to the Company to operate a Shell Service Station at Lower Estate, Road Town, containing by admeasurement 0.514 acres with the building and erections thereon, and for an injunction in terms similar to those set out above.

4 The learned trial Judge allowed Shell, through Counsel present at the time, to be heard on the ex parte application. Clearly this was done in the interest of justice and to save time.

5 The arguments and submissions were confined to the facts disclosed in the affidavit and the law that Counsel regarded as relevant.

THE FACTS

6 On the 1st February 1983, the parties entered into an agreement for the grant of a licensee by Shell to the Company to operate a service station for petroleum and petroleum products supplied by Shell, on premised owned by shell, for a period of 5 years, and thereafter from month to month, until terminated in accordance with the provisions of the agreement.

7 On the 31st July, 1985, or within five years of the date of the said agreement, Shell-through its Marketing Manager-sent a notice to the Company stating that it was acting under clause 15 of their agreement and giving "Notice of Termination of the said Agreement three months after the first day of August 1985, that is to say, with effect from the first day of November 1985".

8 On the 30th October 1985, or about three months after the date of the notice, the solicitor for the Company wrote Shell in the following terms:

"…..upon the proper construction of the agreement your Company may not properly terminate the licence within the first five years of its term unless our clients have been in breach of the agreement. Our clients are not and have never been in breach of the agreement and you have not alleged any breach at any time prior to the service of the notice dated 31st July 1985 or at all.

There is now clearly a dispute involving the proper interpretation of the agreement in relation to rights of termination and our clients are able ready and willing to proceed to Arbitration in terms of the Agreement to resolve the issue. If therefore you maintain your position that the agreement is terminable or terminated at this time without breach on our clients' part we hereby give you notice that we wish to proceed to Arbitration in terms of the agreement."

9 The solicitor's letter also mentioned a method for the selection of an Arbitrator and referred to the eventuality of waiver of arbitral but it is unnecessary to quote these aspects.

10 Now it is not clear when that letter of 30th October 1985 first came to the attention of Shell Antilles and Guianas Limited; bus in my view the facts existing prior to the receipt of the letter permitted the conclusion that Shell was entitled to believe that the Company had acquiesced and that the Notice of Termination remained unopposed. Almost 3 months had elapsed and just about 2 days were left before the notice become effective, according to the letter.

11 On the 1st November 1985, Shell by its servants and or agents went on the premises at Lower Estate, Road Town, and, according to Patsy Bake, they sought to force her therefrom and to close the business by changing the locks on the building and the pumps with petroleum. She also alleged that she was being intimidated and put in fear for her personal safety, while in the office.

THE HEARING

12 The application went before the trial Judge on the afternoon of the 1st November 1985 and learned Counsel for the applicant sought to obtain an answer to the question: whether on a proper construction of the agreement the Notice of Termination was a valid notice which properly had the legal effect of ending the agreement between the parties? This, however, was not the only point that was raised. The Record showed that the Judge was also invited by learned Counsel for the parties to give consideration to the almost 3 months delay on the part of the Company is not responding to the notice dated 31st July 1985, the preservation of the status quo based upon the existing facts end circumstances, the balance of convenience and the fact that the claim sought damages for a breach of contract. I understood learned Counsel for the parties text say that there was no dispute between them as to whether there was a tribal issue or serious question raised for decision, or that such-question involved the interpretation of certain of the 18 clauses of the agreement dated 1st February 1983.

13 Having heard the contentions of learned Counsel, the trial text adjourned until the following day when she delievered an oral judgment refusing the application for an interim injunction.

THE APPEAL

14 There were some 14 grounds of appeal related in some way to the Notice of Termination and the construction of the agreement. Learned Counsel for the appellant submitted that this Court should decide the issue of the proper construction of the agreement and that would bring an end to the whole case. Then, putting aside the question of construction the clauses in the agreement, Dr. Ramsahoye submitted-inter alia-that learned trial Judge had exercised her discretion improperly and had not addressed her mind to the correct principles. He contended that in text the application she could not have seen that (a) there was a serious question to be decided and (b) the balance of convenience merited the grant of and interim injunction. It was pointed out that the grounds of appeal did not refer to the decision of the Judge on these aspects and Counsel contended further that "assuming that she held that there was a serious question to be decided and assuming that she saw where the balance of convenience lay, it was inexplicable how she exercised her discretion the way she did."

15 Learned Counsel for the respondent submitted, among other things, that the facts and circumstances of this case showed that it was not a proper case in which an interim injunction should be granted. Mr. Archibald pointed not that the Statement of Claim filed by the solicitor for the appellant had quantified the damages allegedly suffered as a result of the alleged breach, and he analysed six principles by which, he said, this Court might be guided. Counsel further urged what in his opinion, the function of the Court of Appeal ought to be in an appeal against an interlocutory matter.

16 Learned Counsel on each side cited a number of cases in support of his submissions. I am grateful to them for their assistance. I have read and considered these authorities but I do not think it will help to deal with them in any way other than I have done.

17 In my view it must remain foremost in the mind of this Court that what was before it was the refusal of the trial Judge to grant a specific interial injunction and an appeal against that particular decision. Consequently, we must determine, after hearing both sides, whether or not the appellant has shown that the trial Judge (a) failed to apply the relevant principles or (b) applied the wrong principles of law or (c) applied the proper principles of law wrongly;(d) whether or not the appellant has proved that the trial Judge exercised her judicial discretion in a manner which offended the law. It was not for us to indicate whether we ought to he counted among the "thousands of judges who, in the opinion of Dr. Ramsahoye would grant the injunction, or what or we should be numbered alongside the single judge who refused it. As Diplock said in BIRKETT v JAMES (1978) A.C, 297...