Win Business (Caofeidan) Ltd v Anadarko China Holdings 2 Company
| Jurisdiction | British Virgin Islands |
| Judge | Levy JA [AG] |
| Judgment Date | 05 July 2023 |
| Neutral Citation | VG 2023 CA 32 |
| Docket Number | BVIHCMAP2022/0044 |
| Court | Court of Appeal (British Virgin Islands) |
The Hon. Dame Janice Pereira Chief Justice
The Hon. Mde. Esco Henry Justice of Appeal [Ag.]
The Hon. Mr. Robert Levy Justice of Appeal [Ag.]
BVIHCMAP2022/0044
THE EASTERN CARIBBEAN SUPREME COURT
IN THE COURT OF APPEAL
Interlocutory appeal — Statutory Demand — Judge's refusal to set aside Statutory Demand served on Appellant by Respondents — Appellant arguing new grounds on appeal during hearing of appeal — New grounds of appeal not mentioned in notice of appeal or Appellant's written submissions — New grounds of appeal not advanced in court below — No formal application made to advance new grounds of appeal — Rule 62.4(8) of the Civil Procedure Rules 2000 — Whether the Appellant ought to be permitted to rely on the new grounds of appeal — Whether the new grounds of appeal were pure points of law or further evidence would be needed on appeal — Whether the Respondents would be substantially prejudiced by the new grounds of appeal being advanced at such a late stage in the proceedings — Whether appeal had any merit if the new grounds of appeal were not allowed
On 2 nd March 2022, the Respondents served a Statutory Demand (the “Demand”) on Win Business (Caofeidan) Limited formerly Win Business (Africa) Ltd (the “Appellant” or the “Company”). The Demand related to various sums, in the nature of costs, disbursements, and interest (the “Demand Debt”) payable by the Company to the Respondents following an arbitration between the parties at the London Court of International Arbitration (the “LCIA”).
By application dated 17 th March 2022 (the “Originating Application”), the Company applied to set aside the Demand on the grounds, inter alia, that the Demand was defective, there were issues in English law as to whether one of the parties had submitted to the LCIA's jurisdiction and that the Demand caused the Company substantial injustice. By further application dated 30 th May 2022, the Company sought an adjournment and amendment of the Originating Application. The amendment sought to raise the point that the Demand sought to enforce a claim in respect of tax due in a foreign jurisdiction and the courts of the Territory of the Virgin Islands (the “BVI”) would not enforce the foreign revenue laws of another state. At the hearing on 31 st May 2022, Jack J [Ag.] granted the amendment application and without counsel for the Appellant mentioning the adjournment application, counsel went on to move the application to set aside the Demand.
By judgment dated 2 nd June 2022 (the “Judgment”) Jack J [Ag.] dismissed the application to set aside the Demand. The judge noted that the BVI court would not permit the enforcement of foreign revenue laws. He further noted that the Chinese tax authorities (“TOOTB”) had already been paid in full many years previously and that all that had been in dispute at the LCIA was which of the three private companies was liable to reimburse the other private company. This, he ruled, was a private law issue and had nothing to do with a sovereign nation (in this case the People's Republic of China (the “PRC”)) enforcing its own tax laws and that TOOTB had no interest in the BVI proceedings or the LCIA arbitration. The judge thus concluded that enforcement of the LCIA award did not offend the foreign revenue rule and the Company did not meet the test for setting aside the Demand. The judge dealt with the other grounds of the application in a summary manner as he did not consider them as being of assistance to the Company.
Being dissatisfied with the judge's ruling, the Company appealed. In the notice of appeal dated 23 rd June 2022, the Company asserted that the learned judge erred by (i) applying the wrong test to the question of whether the Demand Debt amounted to vindication of foreign revenue law; (ii) failing to make any determination on the Respondents' argument opposing the set aside application that recognition of foreign revenue law is permitted so long as there is no enforcement; (iii) failing to properly consider whether the Appellant's awards such as costs and disbursements associated therewith should likewise be unenforceable; and (iv) failing to properly consider the jurisdiction issue arising out of the suggestion that BECB Limited (“KMCPL”) was not a party to the arbitration agreement.
At the hearing of the appeal, the fourth ground/jurisdiction issue was abandoned and counsel for the Appellant raised, for the first time, the argument that the Respondents were coerced into the role of nominees of TOOTB and on that basis, made the tax payment. As this new point had been raised, the parties were given an opportunity, post the hearing of the appeal, to file written submissions on the right to rely on new points on an appeal. In written submissions, the Appellant asserted that the nominee/coercion point was not strictly new and rather, it was a point of pure law which they could rely on. In any event, the Appellant argued, any prejudice to the Respondents could be compensated in costs. The Respondents countered that since the Appellant chose not to raise this issue in the lower court, the Court of Appeal did not have the benefit of the judge's judgment on the issue. Further, there were no exceptional circumstances on the facts to allow the new points to be raised and the Appellant failed to explain why the issue was not advanced in their grounds of appeal or addressed in any of their written submissions before the Court.
Held: refusing permission to argue the new points on appeal, dismissing the appeal and subject to any written submissions being filed within seven days, ordering the Appellant to pay the Respondents' assessed costs of the appeal, such costs to be assessed by a judge of the Commercial Court unless agreed within 21 days, that:
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1. Parties should argue all their points at first instance and a trial is not the dress rehearsal for the appeal. When a party seeks to raise a new point on appeal, the party should seek the Appellate Court's permission to so do, and a cogent explanation should be given as to why the point was not raised below. A case need not be exceptional before a new point may be argued on appeal, however, whether or not an Appellate Court will permit a new point depends on where such new point lies on the spectrum between pure points of law that can be argued on the findings of the judge below, and those which, had they been raised below, might have changed the course of the evidence given at trial. Where a new point would require further evidence or, had the new point been argued below it would have resulted in different evidence being filed, an Appellate Court should err on the side of caution in allowing such new points to be raised. This caution is even greater where the other party has not had adequate time to deal with the new point.
Rule 62.4(8) of the Civil Procedure Rules 2000; Notting Hill Finance Limited v Sheikh [2019] EWCA Civ 1337 applied; Singh v Dass [2019] EWCA Civ 360 applied; Ex parte Firth, In re Cowburn (1882) 19 Ch. D. 419 considered; Prudential Assurance Co Ltd v Revenue and Customs Comrs [2017] 1 WLR 4032 applied.
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2. On the facts, in addition to there being no formal application to run the nominee/coercion argument on appeal, the Appellant gave no explanation for the delay in seeking permission to do so. There was also no explanation for the omission to make the points below. In considering the nominee/coercion argument, the Court found that they were not pure points of law. Rather, the argument was a mixture of fact and law since the Court would have to determine whether such a relationship existed and how it came into being. The Court therefore accepted the Respondents' contention that had they known they would face this argument on appeal, they would have wanted to adduce evidence. Thus, contrary to the Appellant's assertion, there was insufficient evidence before the Court to deal with this argument and the Respondents did not have adequate time to deal with it. The Court also noted that the argument was strictly new on appeal, having never been raised in either the Appellant's submissions or before the trial judge. Instead, the Appellant ran the opposite argument in the lower court, denying that the Respondents were representatives of TOOTB. The Appellant, having lost on this particular basis, could not now disavow its earlier position and run a diametrically opposite argument in the Appellate Court. The Court having considered these matters and the fact that the Respondents would be substantially prejudiced if the new points were allowed, decided to refuse permission to the Appellant to run the new arguments on appeal.
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3. Parties to litigation can reasonably be expected to have advanced all proper arguments at both first instance and on any appeal. On the facts, the matter had already taken up a considerable amount of time and resources. If yet further points were to be taken on the appeal, then further court time would have to be afforded to any such hearing. This inefficient use of court time would be to the detriment of court users and a waste of the court's resources. This was a further reason for the Court of Appeal to deny permission to the Appellant to raise any new grounds in the appeal.
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4. As had been conceded by the Appellant, unless the nominee/coercion argument had been established, the Appellant had no case on the appeal. There was no bona fide dispute on substantial grounds whether the Demand Debt was, and remains, due. The Demand did not seek to enforce a tax liability due to TOOTB and there was no evidence whatsoever that TOOTB had an interest in the LCIA proceedings or the proceedings in the BVI. The learned judge therefore did not err in finding that enforcement of the arbitration...
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