THE Judicial Committee of the Privy Council has delivered a landmark ruling which paves the way for a judge to make an order to recover costs.
On Tuesday, five Privy Council judges – Lords Lloyd-Jones, Leggatt, Burrows, Stephens and Lady Rose – reversed a judgment of the Court of Appeal in a defamation claim and ordered that costs should be paid to Dr Anthony Elias which must be assessed by a master in chambers.
Elias had been sued by former Trinidad Cement Ltd (TCL) CEO Rollin Bertrand, TCL and Caribbean Cement Ltd.
They alleged that Elias, a shareholder, defamed them at an annual general meeting of TCL, in 2009, “voicing his dissatisfaction about the way Mr Bertrand had provided information about TCL to its shareholders, and the accuracy of such information in relation to a cement quality crisis at CCL’s cement plant in Jamaica in 2006,” according to the history of the claim in the judgment.
The defamation claim alleged that Elias accused Bertrand of being dishonest in the conduct of TCL’s business, mismanaging the affairs of the companies and being prepared to mislead the shareholders and directors, among other allegations. The judgment gave details of Elias’s alleged anger over the cement crisis in 2006 involving the supply of defective cement and losses of $63 million.
On the morning of the trial, on January 20, 2015, the companies’ lawyers withdrew the defamation claim and told the judge Bertrand “no longer had a role to play in TCL or CCL,” he and the board had been removed as directors and he had been terminated as group CEO.
Justice Joan Charles ordered Bertrand and the companies to pay assessed costs to Elias, since it was a joint claim.
The Appeal Court, comprising Justices of Appeal Alice Yorke Soo Hon, Peter Rajkumar and Maria Wilson, overturned Charles’s ruling on costs and ordered instead that the costs be on the prescribed sale.
If costs are quantified as prescribed costs, they would amount to $27,000. In contrast, if costs are assessed, they would amount to $559,695.
Elias appealed to the Privy Council.
The Law Lords held that “the general rule that costs awarded are prescribed costs may not be appropriate in all cases.”
They said the Appeal Court fell into error by not exercising its discretion in quantifying costs.
“The Board considers for several cumulative reasons, in the circumstances of this case where the reasonable estimate of the actual costs is hugely disproportionate to the likely amount of prescribed costs, that this is an exceptional case.”
They pointed out that a “powerful reason” for departing from the general rule in relation to TCL and CCL was that the companies acknowledged the defamation claim was “ill-founded,” and should never have been brought.
“The Board considers that the prescribed costs regime is for genuine claims, and, although it generally applies in cases of discontinuance, it should not be used to protect TCL and CCL from the consequence of reimbursing the defendant in relation to the reasonable costs he actually incurred in defending ill
