Roberson v Belize Freight & Trade Services Ltd et Al
| Judge | Conteh, J. |
| Judgment Date | 01 January 2000 |
| Court | High Court (Belize) |
| Docket Number | 187 of 1982 |
| Date | 01 January 2000 |
High Court
Conteh, J.
187 of 1982
Mr. Michael Young S.C. for the plaintiff.
Mr. Jeremy Courtenay for the defendants.
Real property - Agreement for the sale of land — Conveyance executed — Option to resell shares to defendant — Second defendant failed to honour agreement — Second defendant sold property to first defendant — Default judgment entered against second defendant — Whether the conveyance to the first defendant was voidable as in fraud of creditors — Whether the first defendant had notice of the judgment registered against the second defendant — Section 149(1) of the Law of Property Act, Chap. 154 — Finding that as a judgment creditor the plaintiff could clearly proceed against the second defendant under the provisions of the Supreme Court Rules.
The facts of this case can, in a sense, be stated in a short compass. The plaintiff was the owner of a piece of land measuring 17.4 acres in Warrie Head in the Cayo District. Sometime in August 1980 he sold this land to the second defendant in this action for the agreed price of $50,000. For this consideration, the plaintiff was to receive 50,000 shares in the second defendant company valued at $50,000 (Exhibit “JR 2”). The plaintiff was also given “the option to resell these shares to the company between the 1st day of February 1981 and the last day of April of the same year at a minimum guaranteed price of $50,000 cash payment.” In due course, on 13 August 1980, a conveyance was executed between the plaintiff and the second defendant conveying the land to the second defendant.
On 28 April 1981, the plaintiff through his then Attorney wrote the second defendant exercising his option to resell the shares to it. It is the case of the plaintiff that he received no money from the second defendant and consequently had to take an action against it. The writ of summons in this action dated 5 August 1981 was tendered as Exhibit “JR 4”.
Subsequently, a default judgment was entered against the second defendant in favour of the plaintiff for the sum of $50,000 with costs to be taxed. In the meantime (the first defendant on 7th January 1982 bought the property from the second defendant) by a conveyance dated 7 January 1982, the land was for the consideration stated therein to be $50,000, transferred by the second defendant to the first defendant(Exhibit “JR 7”).
It is against this backdrop that the plaintiff by a writ dated 1st July 1982 sued both defendants claiming as follows:
1. “A declaration that the conveyance of 7th January, 1982 between the first-named and second — named defendant istoidable as being in fraud of creditors.
2. An order setting aside the said Conveyance.
3. An injunction restraining the first-named and second-named defendant from dealing with or disposing of the property described in the said conveyance.
4. Further or other relief.”
In due course, by the end of 1982, pleadings were filed and changed between the parties and by February 1983 issues had been joined between them and the matter was slated for hearing. Unfortunately, however, for one reason of the other, the action could not be brought to resolution by a hearing in the court. It became caught in the interstices of what has been colloquially termed as the backlog. This refers to the mounting number of cases that have for sometime not been disposed of and are still pending in the Supreme Court.
This case therefore came to acquire the status of an “Ancient”, when it is realized that the writ commencing it was first issued in 1982 and it was not until the year 2000 when its old bones were agitated as it were, and it was given a new lease of life and sprang into action.
Early this year an application was made by the plaintiff to amend his Statement of Claim. This was duly granted by the court in February and the defendant was also granted leave to file an amendment Defence.
Thus it was on the amended Statement of Claim and Defence that issue was finally joined between the parties when this action came before me for trial on 27 September 2000.
By this action the plaintiff now claims:
1. “A Declaration that the Conveyance of 7th January 1982 between the first-named and second-named defendants is voidable as being in fraud of creditors.
2. An Order setting aside the Conveyance.
3. An injunction restraining the first-named and second-named defendant; from dealing with or disposing of the property described in the said Conveyance save and except by Order of the court.
4. An Order that an incumbrance be recorded against the property as security for the judgment of 1st September, 1981 in Supreme Court Action No. 256 of 1981 from the date of such judgment.
5. Further or other relief.”
I must point out here that the fourth relief the plaintiff sought was grounded in paragraphs 11 and 12 of his Amended Statement of Claim as follows:
11. “Further or in the alternative, by virtue of Order 42, rule 4 of the Supreme Court Rules the judgment of 1st September, 1981 in Supreme Court Action 256 of 1981 bound the property and became attached thereto.
12. The said judgment is registerable as an incumbrance against the property by virtue of s.103 (d) of the Law of Property Act.”
For its part, the first-named defendant in its Amended Defence, avers that it was not a party to the matters contained in paragraphs 1, 2 and 3 of the Amended Statement of Claim and had no knowledge before trial of any of the matters alleged. I should state here in parenthesis that the matters alleged in these paragraphs of the plaintiffs Amended Statement of Claim relate to the sale in August 1980 by the plaintiff of the property in question to the second-named defendant at an agreed price of $50,000, and that the said sum of $50,000 was never paid, and that the second-named defendant was on 1st September 1981 ordered by the court to pay the said sum of $50,000 plus costs in Supreme Court Action No. 256 of 1981.
The first-named defendant avers that indeed the consideration for the purchase of the property was $50,000 and denies that no monies were paid by it to the second-named defendant in respect of the property, and avers instead, that at the material time of the conveyance, the second-named defendant was indebted to it (the first-named defendant) for a sum in excess of $50,000 and that the transfer of the said property by the second-named defendant to it was in part payment of that indebtedness. The first-named defendant further denies the averment by the plaintiff that the transfer of the property by the second-named defendant to the first-named defendant was effected with intent to defraud the creditors of the second-named defendant. The first-named defendant avers instead that at all material times it was a creditor of the second-named defendant who was and still is indebted to the first-named defendant for a considerable sum and that it was right and proper that the second-named defendant should transfer the property to the first-named defendant as part payment towards that indebtedness. The first–named defendant therefore denies the averment of the plaintiff that the natural consequence of the transfer of the property resulted in the inability of the creditors of the second-named defendant to enforce their claim.
The first-named defendant also averred that the plaintiff failed to register the judgment of 1st September 1981 in Supreme Court Action 256 of 1981 as an incumbrance against the property pursuant to s.103 (d) of the Law of Property Act and that it (the first-named defendant) had no notice of the said judgment.
For its part, the second-named defendant denied the plaintiffs claim and put up the shield of satisfaction against his claim. That is to say, the agreed purchase price for the land between it and the plaintiff was paid for in the manner agreed between the plaintiff and itself, namely the issue of 50,000 shares of a nominal value of $1.00 each in the capital of the second-named’ defendant company, and that in fact, the plaintiff had in writing acknowledged!, payment for the property.
The second-named...
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