Tanfield Chambers in condominium appeal to privy council
11th February 2014
The Privy Council has given leave for an appeal from the Bahamas Court of Appeal, settled by Chris Maynard, in a dispute concerning the management of a condominium in Grand Bahama: Metaxides v Swart JCPC 2013/0062. The issue concerns the naming of parties and the validity of a compromise of the dispute.
In 2006 attorneys for Mr Metaxides commenced proceedings in the Supreme Court of the Bahamas seeking declaratory relief in relation to the management and affairs of a condominium known as Silver Point Condominium Apartments, of which he was a member. Amongst other things, he was concerned with the way in which monies paid out in respect of hurricane insurance for the building were being handled. In the originating process the defendant was named as “Silver Point Limited”. However, there was some doubt as to name of the entity responsible for the management of the condominium and, upon an application for an interlocutory injunction to restrain dealings with the insurance monies made two days after issue of the proceedings, the name of the defendant was amended to “Silver Point Limited (Silver Point Condominium Apartments)”. The originating process as amended was re-sealed and served, together with the injunction. Thereafter, attorneys for the condominium entered a Memorandum of Appearance and the proceedings were defended until an agreement was reached between Mr Metaxides and the board of the condominium to compromise the dispute. In 2009, a consent order which contained the terms of the compromise was approved.
In 2010 some members of the condominium who were dissatisfied with the compromise commenced fresh proceedings in the Supreme Court of the Bahamas in which they challenged the compromise in the original action. They sought declarations that the consent order was invalid and unenforceable and/or should be set aside. Amongst other things, they claimed that the original action had been commenced against a non-existent entity, Silver Point Limited having been the name of the company which originally developed the building in the 1960s, but which had been dissolved in 1996.
At trial in 2012 the Supreme Court held that the board of the condominium had the power to settle the original action if it was acting lawfully and that the board had, indeed, acted lawfully. The original action had proceeded on the basis that the proper parties were before the court and no one had challenged the validity of the proceedings. Therefore the plaintiffs’ claim in the new action failed.
The plaintiffs appealed. In a reserved judgment, the Bahamas Court of Appeal determined, as a preliminary issue, that the original action had been commenced against a non-existent entity and there was no evidence the proceedings had been properly amended. Therefore the original proceedings and all orders made within them were a nullity. The Court of Appeal ordered the order of the Supreme Court to be set aside.
Mr Metaxides’ attorneys and counsel in the Bahamas, Sessions House Chambers, contacted Chris Maynard for assistance. Mr Metaxides then sought permission to re-open the appeal (on the basis that no order on the appeal had been perfected) and to adduce further evidence to show that the amendment had been made pursuant to permission given orally three days after commencement of the original proceedings. The Bahamas Court of Appeal held that it had no jurisdiction to re-open the appeal. Within 3 weeks after that, Mr Metaxides’ application for leave to appeal had been lodged in London by Lawrence Graham LLP as Privy Council Agents.
The issues in the appeal to the Judicial Committee are:
- Whether the identity of parties to the original action had been found as a fact by the Supreme Court and, if so, whether the Court of Appeal was correct to depart from that finding;
- Whether, upon the true construction of the originating process in the action, the original had been brought against the condominium or against a non-existent entity; and
- Whether the Court of Appeal had any power after judgment to receive fresh evidence and/or to reconsider its judgment.