Supreme Court
Action No. 30 of 1992
5th January, 1996
GEORGE D. MEERABUX, P.J.

Mr. Dylan Barrow for the applicant/defendants
Mr. E. Courtenay for respondents/plaintiffs.

Application for enlargement of time to file a notice of motion to set aside a judgment - O.65 r.6 - misinterpretation of relevant appeal rules by then attorney-at-law - Alleged consequent loss of right to appeal - No authority covering case of oversight, lack of diligence or negligence or tardiness on part of counsel as a ground for enlargement of time - New material evidence - Conditions to be satisfied before it can be received - Conditions not met in instant case - Pre-incorporation contracts - Inference from acts of plaintiffs' companies that a new contract was entered into incorporating the previous agreement - Delay - No solid grounds for depriving plaintiffs of their judgment - application refused - Costs to the respondents/plaintiffs.

J U D G M E N T

This is an application pursuant to 0.65 r. 6 for enlargement of time to file a Notice of Motion to set aside my judgment given on the 8th December, 1994, and a stay of execution and proceedings by the plaintiffs in the said judgment.

The application is supported by affidavits filed by the defendants as well as by their Counsel in this matter.

The substance of the two affidavits depose that:-

(1) owing to a misinterpretation of the relevant appeal rules by their attorney on the record, the applicant/defendants lost their right to appeal the said judgment; and

(11) compelling new material evidence came to the applicants/defendants attention after the judgment which casts doubt on the proprietary title of the respondents/plaintiffs title to the said land.

Counsel for the applicants/defendants submitted that:-

(a) the sale of the caye to the plaintiffs took place before incorporation of the plaintiffs companies and submitted that pre-incorporation contracts are a nullity, citing Newborne v. Sensolid (Great Britain) Ltd. 1954 1 Q.B. 48; and that the contract for the purchase of land is a nullity.

(b) application was filed on the 19th of September, 1995, nine months after the judgment, when new material evidence came to light on 30th August, 1995.

Counsel for the respondents/plaintiffs replied that:-

(a) a stay of execution cannot be based on 0.65 r. 6 which deals only with enlargement of time and that the court has ruled that the applicants/defendants lease be forfeited since 1994, further that this transaction took place since 1986.

(b) the application could not succeed because the respondents/plaintiffs Certificate of Title to the lands cannot be impugned except for fraud or that the title of the registered proprietor has been superseded by a later title acquired under section 42 of the Land Property Act or barred by the Limitation Act citing:-

(i) section 41 of the Land Property Act;
(ii) Crawford v. Goscinski C.A. Belize Law reports Vol. 1 page 376; and
(iii) Caribe Farms Industries Limited v. Atlantic Bank Limited and others Civil Appeal No. 4 of 1995.

(c) there is a misconception on pre-incorporation Contract in that such contracts cannot be enforced against the company by the other party to the contract unless the company subsequently ratifies the contract and if the company fails to do so the promoters are liable. In this case the company was not incorporated at the time of the sale but adopted the contract subsequent to incorporation.

Therefore, it was submitted, the facts of the case can be distinguished from the Newborne case Supra.

(d) there was excessive delay in bringing this application to the court and the court should not exercise its direction to grant the application.

0.65 r. 6 confers on the court power to abridge or enlarge time "for doing any act or taking any proceeding, upon such terms (if any) as the justice of the case may require" etc.

The object of the rule is to give the court a discretion to extend time with a view to the avoidance of injustice to the parties Schafer v. Blyth (1920) 3 K.B. 143; but if substantial delays occur without any explanation being offered, the court is entitled in the exercise of its discretion to refuse the extension of time. The Supreme Court Practice, 1985 Vol. 1 0.3 r, 5 under caption "Scope of Rule".

I shall now deal with the main grounds of the application:-

(1) That because of the misinterpretation of the relevant appeal rules by the then attorney on record the applicants lost their right to appeal the said Judgement.

I find that there is no authority to cover a case involving a case of oversight, lack of diligence and even negligence and tardiness on the part of the counsel as a ground for enlargement of time. I find no merit in this ground.

(2) The second ground is that compelling new material evidence came to the applicants attention since the judgement which casts doubts on the proprietary title of the plaintiffs to the said land.

The law is quite clear that:-

"When a litigant has obtained a judgement in a court of Justice... he is by law entitled not to be deprived of that judgement without very solid grounds" (Brown v. Dean [1910] A.C. 373, p. 374, per Lord Loreburn L.C. who adds that the maxim interest reipulicae ut finis sit litium is applicable) if it is sought to deprive him of his judgement by further evidence, there are conditions which must be satisfied before it can be received:" first, it must be shown that the evidence could not have been obtained with reasonable diligence for use at the trial; secondly, the evidence must be such that, if given, it would probably have an important influence on the result of the case, thought it need not be decisive; thirdly, the evidence must be such as is presumably to be believed, or, in other words, it must be apparently credible though it need not be uncontrovertible" (Ladd v. Marshall [1954] 1 W.I.R. 1489: [1954] 3 All E.R. 745, C.A., per Lord Denning L.J. p. 1491, approved in Skone v. Skone [1971] 1 W.L.R. 812; [1971] 2 All E.R. 582, H.L: Roe v. Robert McGregor and Sons Ltd. [1968] 1 W.L.R. 925; [1968] 2 All E.R. 636, C.A.)."
The Supreme Court Practice 1985 Vol. 1, 059/10/7.

I find that although the above learning deals with Appeals to the Court of Appeal, the principles are applicable to this application before me where the Court is asked to receive "compelling new evidence" which may have the effect of the court reviewing and possibly overrule its own judgment.

"For the importance of the first condition, see Shedden v. Patrick (1869) L.R. 1 H.L. (Sc.) 470, per Lord Chelmeford, p. 545. It is not sufficient that reasonable diligence was exercised by the legal advisors; the condition will not be satisfied if the party himself failed to exercise reasonable diligence (Weller v. Dunbar. January 27, 1984 (unrep) C.A.). A new trial will not be ordered where the fresh evidence is a document which could have been obtained by discovery during the proceedings. (Turnbull v. Duval [1902] A.C. 429, P.C.). Moreover, evidence not called at the trial is necessarily regarded with caution. It may be prompted or coloured by a knowledge of what happened in the court below; and in any case it is the duty of the party "to bring forward his whole case at once and not to bring it forward piecemeal as he found out the objections in his way" (Re New York Exchange Ltd. (1888) 39 Ch. D 415, P. 420). But where a note of the oral evidence taken in the court below had been lost, it was allowed to be given on appeal (Ex p Firth. re Cowburn (1882) 19 Ch. D 419). The discretion of the Court to admit fresh evidence will be more readily exercised where there has been surprise (Technograph Printed Circuits Ltd. v. Mills and Rockley (Electronics) Ltd. [1969] R.P.C. 395, per Sachs L.J.; Bogsby v. Dickinson (1876) 4 Ch. D 24; and, a fortiori, where there is suspicion of deception (Skone v. Skone, above).
The Supreme Court Practice Supra

At the trial the applicants had the services of two Counsels who together with the applicants had the task of exercising reasonable diligence in procuring the facts and relevant documents. I find that an Order for administration of interrogatories or discovery of documents would have revealed the substance of the "compelling new evidence".

Furthermore, I find from the judgement at the trial that the question was raised as to the proprietary title of the plaintiffs when Frederick James Dodd, one of the share holders/directors of the plaintiffs was cross-examined by counsel for the applicants/defendants but was not pursued since it was not pleaded. It reads as follows:-

"The Lamonts has consistently refused to allow him access to the Island because they claim the entire Island is theirs and further claimed that the sale to Glovers Ree and Long Cave Ltd. were not good". (my emphasis)

See lines 13-16 of page 7 of the Judgement No. 30/92 in the said case.

I therefore find that both applicants/defendants as well as their counsel on record must have had some knowledge which may have cast doubts in the respondents/plaintiffs title to the said property during the trial when the issue was raised by them but for some reason unknown they failed to pursue it.

"As regards the second condition, the view of Lord Loreburn L. C. in Brown v. Dean above, was that, in order to be received, the new evidence "must at least be such as is presumably to be believed, and if believed would be conclusive." Lords Atkinson and Mersey apparently agreed; but the last six words go further than Lord Shaw was prepared to go in his speech: it was sufficient, he thought, if the new matter was "so gravely material and so clearly relevant as to entitle the court to say that material and relevant fact should have been before the jury in giving its decision- (p. 376). Neither of these statement have been generally acted upon in subsequent cases; the former has been generally treated as going too far; the latter as not going far enough. Hanworth M.R. in R. v. Copestake [1927] 1 K.B. 468. p. 474, thought "the evidence must be of such a character that not merely is it relevant but of such importance that it would have affected the judgement of the tribunal if it had been before them at the original hearing of the case." Scrutton L.J. , p. 477, thought "it must be of such weight as. if believed, would probably have an important influence on the result" (and see per Birkett L.J. in Corbett v. Corbett [1953] P. 205, P.215). The Privy Council in Hip Foong Hong v. Neotia and Co [1918] A.C. 888, P. 894, thought that the evidence must be "of such a character that it would, so far as can be foreseen, I have formed a determining factor in the result" (words adopted by Lord Maugham in Rowell v. Pratt [1937] A.C. 101, p. 116, by Evershed. M.R. in Corbett v. Corbett, above page 215 and again by the Privy Council; in Andrew v. Andrew [1953] 1 W.L.R. (1454).
The Supreme Court Practice Supra

The question in a nutshell is whether the "new compelling evidence" is "of such a character that it would so far as can be foreseen have formed a determining factor in the result."

The undisputed facts of this case are that the respondents/plaintiffs obtained a Certificate of Title to the said land. Section 41 of the Laws of Property Act provides that a registered title to land under Part 11 of the General Registry Act shall be an absolute and undefeasible title except where it is found that:-

(a) a fraud was committed in respect of the issue of the Certificate of Title; or

(b) the title of the registered proprietor has been superseded by a later title acquired under Section 42 or barred by the Limitation Act in favour of the person making the challenge.

I find that the proposed fresh evidence reveals no fraud or that the plaintiff's title has been superseded by a later title etc. which could have been a determining factor in the result." The cases of Crawford v. Goscinski Belize Court of Appeal Belize Law Report p. 376 and the recent case of Caribe Farms Industries Ltd. et al v. British American Cattle Company Civil Appeal No. 4 of 1995 is illustrative of this point.

The third condition, which is, in effect, subsidiary to the second, is taken from the words of Lord Loreburn L.C., in Brown v. Dean, above and the judgements of the Court of Appeal in Ladd v. Marshall (1954). The fact, for example, that a witness now takes the view that he was mistaken in the evidence he gave in the court below is not usually sufficient to justify his recall (Purseli v. Railway Executive [1951] 1 All E.R. 536).
The Supreme Court Practice Supra.

I therefore find that the said three conditions for the reception of the new evidence have not been satisfied.

I shall now deal with the Newborne v. Sensolid (Great Britain) Ltd. Supra case.

The legal principle as I understand it is stated as follows:
"SUBJECT. (5) Contracts

(i) Contracts before Incorporation or Commencement of Business.

824. Extent of liability of company. A company is not bound by contracts purporting to be entered into on its behalf by its promoters or other persons before its incorporation (q). The company cannot, after incorporation, ratify or adopt any such contract because there is in such cases no agency and the contract is that of the parties making it (r). The adoption and confirmation by a resolution of the directors of the contract made before the incorporation of the company by persons purporting to act on its behalf does not create any contractual relation between the company and the other party to the contract, or impose any obligation on the company towards him (s).

825. Adoption of pre-incorporation contracts. In order that the company may be bound by agreements entered into before its incorporation, there must be a new contract to the effect of the previous agreement (t). This new contract may, however, be Inferred from the acts of the company when incorporated (u), except where such acts are done in the mistaken belief that the agreement is binding (a).

If the company has notice of a contract made before its incorporation between the persons under whom it claims property of which it takes possession and a former owner of the property, whereby a charge or encumbrance was imposed on the property, the company takes subject to the charge or encumbrance, although it is not liable to be sued for breach of the contract (b)."

Halsbury Laws England 3rd Edition Vol. 6 Paras. 824 and 825.

I find that there is evidence that the contract to purchase the land was made prior to the incorporation of the plaintiff's company but there is no evidence before me that the company failed to enter a new contract incorporating the previous agreement or that the vendors took steps to have the contract declared a nullity bearing in mind that the contract of sale was only between the vendor and the plaintiffs and not the applicants/respondents.

On the contrary, I find that the subsequent acts of the plaintiff's companies in instituting this action can lead to the only reasonable inference that a new contract was entered into incorporating the previous agreeement. Re. Empress Engineering Co. (1880) 16 Ch. D. 125 C.A. at p. 128.

I therefore find the facts in Newborne v. Sensolid case is to be distinguished from this case and that the legal principle enunciated in that case has no relevance.

I shall finally deal with the delay in filing the application.

This application has been filed nine months after the judgement was delivered on the 8th December, 1994, which was dealt with by the Court of Appeal and the Privy Council without success. The plaintiffs "is by law entitled not be deprived of their judgement without very solid grounds."

I can find no solid grounds for depriving the plaintiffs of their judgement.

The application for enlargement of time to file a Notice of Motion is refused for the reasons outlined in my judgement.

Costs to the respondents/plaintiffs to be taxed or agreed.

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