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You are here: BAILII >> Databases >> Jersey Unreported Judgments >> Representation of Reva Holdings Limited [2014] JRC 026 (27 January 2014) URL: http://www.bailii.org/je/cases/UR/2014/2014_026.html Cite as: [2014] JRC 026, [2014] JRC 26 |
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Doléance - reasons for refusal of petition by way of doléance
Before : |
J. A. Clyde-Smith, Esq., Commissioner, and Jurats Le Cornu, Nicolle, Liston, Blampied and de Veulle. |
IN THE MATTER OF THE REPRESENTATION OF REVA HOLDINGS LIMITED
AND IN THE MATTER OF A DOLEANCE APPLICATION
Jayne Clara Grant appeared for Reva Holdings Limited.
Advocate M. W. Cook appeared for Jersey Home Loans Limited.
Advocate A. J. Clarke appeared as Amicus Curiae.
judgment
the commissioner:
1. On 12th November, 2013, the Superior Number of the Royal Court refused the petition of Reva Holdings Limited ("Reva") by way of doléance and we now set out our reasons.
2. Reva was represented by its director and beneficial owner, Miss Jayne Clara Grant, but she was happy to rest on the submissions helpfully put forward by Mr Clarke, who the Court had appointed amicus curiae. Mr Cook appeared for Jersey Home Loans Limited, who resisted the petition.
3. Reva first applied for a Remise de biens on 20th September, 2013, at which time the Court, in accordance with Article 2 of the Loi (1939) sur les Remises de Biens, appointed Jurats Morgan and Kerley ("the Jurats") to examine Reva's property and report on the appropriateness of a Remise. The application came back before the Court on 4th October, 2013, at which time the Jurats presented their report which recommended against the granting of a Remise. Following submissions on behalf of Reva, the Court adjourned the matter to 14th October for further argument and reserved its decision.
4. We were informed by Mr Cook that the Court circulated its draft judgment declining a Remise on 21st October, 2013, and following representations on behalf of Reva deferred issuing its final judgment until 24th October, 2013, in order to see whether an offer for the property as a whole at a price which would provide a meaningful surplus was forthcoming. No such offer was forthcoming and on 25th October, 2013, the Court issued its final judgment refusing the Remise.
5. The factual background is set out in the Court's judgment as follows:-
6. At the hearing on 14th October, 2013, Miss Grant produced an estimate from Mr Barry Pickersgill for the legal work required to enable the flats to be sold off separately in the sum of £6,000. She submitted that the Court should not proceed on the valuation agreed between Le Gallais, Broadlands and Mr Labesse and produced an e-mail valuation of 11th October from Mr Nigel Sweeney, a chartered surveyor, who valued the property on the basis of selling the four flats individually in the total sum of £670,000 or, if the property were to be sold as a whole, a likely valuation of between £600,000 and £650,000, Miss Grant had advertised the flats for sale via the Web and an individual had expressed an interest in acquiring Flat 2. She also referred to the fact that Geoffrey Wills Associates, chartered surveyors, had in April 2010 valued the property at £625,000 (and £780,000 after completion of the necessary work). The same firm had produced a valuation of £650,000 in January 2011, based on the then current condition of the property. The Court's judgement continued as follows:-
7. After a further short adjournment to look into the precise amount due to Jersey Home Loans Limited, the Court concluded as follows:-
8. The law in relation to Doléance is well established and was helpfully summarised by Birt, then Deputy Bailiff, in the case of AG v Michel and Gallichan [2006] JRC 089 at paragraphs 7-9 as follows:-
9. In its representation Reva put forward the following grounds in support of its petition for a doléance:-
10. It was asserted that the Population Office had interfered in correspondence over the property, causing the valuations made by Le Gallais and Broadlands to be reduced. It would seem that the Attorney General had abandoned a prosecution against Miss Grant and Reva for allowing up to five persons to lodge in the property with Miss Grant as opposed to letting out the four units to qualified persons. Le Gallais had inquired into the housing status of the property and ascertained that it was subject to standard 1(1)(a-h) conditions in respect of the three units that existed when Reva acquired the property and on any newly created units. The Population Office had confirmed that each of the now four units should be let to or otherwise occupied by persons who are "entitled". Miss Grant's ability to take up to five lodgers had been a short term concession to her which would not be extended to any new owner. This "interference" was stated to be in breach of the rights of Miss Grant and Reva under the ECHR and in particular their Article 8 right to respect for private and family life.
11. We could see no evidence of any "interference" by the Population Office and if there had been a breach of the Article 8 rights of Miss Grant and Reva it was a matter to be pursued separately. It had no relevance to the petition.
12. The Jurats had listed a Michael and Paul Dineen as unsecured creditors in the sum of £69,040.51, which represented a large proportion of the total unsecured claims of £81,340.84. Their claim was disputed by Miss Grant, who wanted them removed from the list of unsecured creditors so that she could demonstrate that if the Remise was granted all the secured and unsecured creditors would be paid in full.
13. A note to the schedule produced by the Jurats acknowledged that this claim by Messrs Dineen was disputed and was the subject of court proceedings. They were therefore contingent creditors who had been properly listed as such.
14. In any event the decision of the Court was not based upon or influenced by the amount of the unsecured claims, but whether there would be a surplus over the secured claims. This ground again had no relevance to the petition.
15. Under these grounds, which can be taken together, it was asserted that Mr Labesse had met with Robin Sappe of Le Gallais and Roger Trower of Broadlands to agree upon a valuation of the property without Miss Grant's knowledge or consent. According to the representation, Miss Grant had organised a second valuation by Mr Nigel Sweeney so that at the hearing on 14th October, 2013, she would have two valuations in her favour. However, as a result of this meeting, the valuation by Mr Labesse had been "interfered with" so that she was only left with one valuation in her favour. This it was again said was an interference with the Article 8 ECHR rights of Miss Grant and Reva.
16. Mr Clarke suggested that these grounds might be better expressed as a breach of natural justice in that Miss Grant had been denied the ability to cross-examine Mr Labesse at the hearing on 14th October, 2013. None of the three experts were present at that hearing, the Court relying on their joint e-mail of 9th October, 2013, in which they had agreed on a valuation of £595,000 if the flats were sold off individually or £500,000 if the property was sold as a whole.
17. Whilst there had been no order of the Court requiring the three agents to meet, the suggestion was made by the Deputy Bailiff in open Court on 4th October, 2013. It is always helpful for any Court faced with experts with differing opinions to ask them to meet to see if consensus can be reached and we saw nothing in the process here which could possibly be described as a breach of natural justice. If Miss Grant has any complaint about the conduct of Mr Labesse in cooperating with the Court in this way, then that is a matter between them. Leaving aside the issue of whether leave would have been given to Miss Grant to cross-examine her own expert, there was nothing to have prevented her from arranging for Mr Labesse to be present on 14th October, 2013, in order to answer any questions that might have been put to him. As it was she relied instead on a further valuation produced by Mr Sweeney. There was no merit in this ground.
18. The person who had shown an interest in Flat 2 had e-mailed Miss Grant on 22nd October, 2013, saying he thought he would go ahead and revise his offer to £150,000 on acceptance of which he would arrange for the mortgage to be in place by mid-November, subject to a satisfactory survey.
19. This offer was £13,000 above the joint valuation attributed to it by the three experts. If sold at this level, and assuming the valuations of the other flats were achieved, this would leave a surplus for the unsecured creditors. If the valuations of the other three flats had been similarly understated, it was submitted that there would be ample funds to cover secured creditors, the unsecured creditors, the fees, legal costs and six months' interest without taking into consideration the income derived from the existing occupants.
20. This was the substantive argument put forward in support of the petition by way of doléance to which we now turn.
21. It was not suggested on behalf of Reva that the Royal Court had made a legal or judicial error of any kind or acted in excess of its jurisdiction. In our view, it could not be contended that there had been a breach of natural justice. On the contrary, the Royal Court approached its decision with great care allowing Reva every opportunity to put its case.
22. In essence, Miss Grant was seeking a second opportunity to convince the Court that she was capable of achieving sales beyond the joint valuation put forward by the three experts. As the Royal Court said at paragraph 26 of its judgment, the joint valuation had been reached after discussion and debate and reflected a spread of expertise between estate agents and surveyors. It must be borne in mind that all valuations are by their nature speculative and it was perfectly reasonable for the Royal Court to prefer the joint valuation to that of Mr Sweeney.
23. All that had changed since the decision of the Royal Court was the receipt of the offer of £150,000 for Flat 2. That offer was within 10% of the joint valuation, a reasonable margin of error, which could of course have worked both ways. Furthermore, this offer for one flat (subject to a mortgage and survey) ignored the practical difficulty the Royal Court identified in selling off the flats individually at different times, namely that the secured creditors could not be forced to agree to be a party to a contract in order to release their charges. Secured creditors had not agreed to release their charges for the sale of Flat 2 or indeed for any of the individual flats. The practice in a Remise is for the whole property to be sold at once, so as to clear all the secured debt.
24. We concluded that Reva came nowhere near discharging the heavy burden upon it of showing that a grave injustice would result if the decision of the Royal Court was not overturned. The petition by way of doléance therefore failed.