Bank of Bermuda v Todd 1991 Civil Jur. No. 400, Talbot and Delro Ltd v Todd 1991 Civil Jur. No. 225

• Jurisdiction: Bermuda
• Judgment Date: 14 May 1992
• Docket Number: Civil Jurisdiction 1991 No. 400
• Date: 14 May 1992
• Court: Supreme Court (Bermuda)

In the Supreme Court of Bermuda

LA Ward, J

Civil Jurisdiction 1991 No. 400

Civil Jurisdiction 1991 No. 225

The Bank of Bermuda

Plaintiff

and

Arnold J. Todd

Defendant

Rodwell Delmon Talbot

and

Delro Limited

Plaintiffs

and

Arnold J. Todd

Defendant

Mr. Bell for the Bank of Bermuda

Mr. Froomkin for Talbot

Mr. Riihiluoma for the Defendant

Rules of the Supreme Court 1985 Order 38, rule 2(3)

Bermuda Constitution Order 1968 s. 6(7)

Applications for attendance for cross-examination — Mareva injunction — Possible criminal proceedings pending

RULING

These are two applications by the respective plaintiffs under 0. 38 r. 2(3) of the Rules of the Supreme Court 1985 for the attendance for cross-examination of the defendant.

In each action respectively, by way of Summons of 20th November 1991. supported by affidavits of 19th November 1991. the defendant sought to have the two Mareva injunctions obtained ex parte by the respective plaintiffs on 14th November 1991 discharged or varied.

The two issues for determination are:

• (1) whether cross-examination of the defendant should be allowed, and

• (2) the scope of such cross-examination should the same be allowed.

Under 0.38 r.2(3) the Court has discretionary power to order the attendance of a deponent for cross-examination. The question in each case is whether the Court should exercise its discretion to so order.

In the notes to the 1979 Supreme Court Practice under the said rule at p. 592 it is stated:

‘There is a discretion as to ordering cross-examination on affidavits filed on interlocutory applications. Cross-examination upon affidavits sworn in applications for interlocutory injunctions is very rare.’

Mr. Riihiluoma submitted that cross-examination of the defendant should not be allowed for the following reasons inter alia:

• 1. That from a review of reported cases as a general rule cross-examination upon affidavits is not permitted where the discharge or variation of a Mareva injunction is sought;

• 2. That the fact that there is a conflict of evidence is by itself not a sufficient reason for ordering cross-examination upon affidavits;

• 3. That cross-examination should not be allowed where the same is likely to be a rehearsal of the cross-examination at the substantive trial'

• 4. That many of the claims against the defendant are of a criminal nature and the defendant has a statutory right not to incriminate himself, and it would be wrong to order cross-examination upon an affidavit in circumstances where the witness may be put in the position of being asked to answer questions that might tend to incriminate him;

• 5. That the defendant should not be subjected to cross-examination in the light of the present weak state of the plaintiff's pleadings, for effectively he would be called upon to supply evidence for the plaintiffs in disregard of the rule that he who alleges must prove.

Mr. Bell submitted that the defendant should be ordered to attend for cross-examination for the following reasons inter alia:

• 1. That it is only in a very exceptional case that the judge ought to refuse an application to cross-examine a deponent on his affidavit;

• 2. That cross-examination of a deponent on his affidavit is a proper course for the purpose of ensuring that the exercise of the Mareva injunction should be effective to achieve its purpose.

• 3. That the privilege against self-incrimination does not apply in contempt of court proceedings which are civil in nature.

As to the scope of the proposed cross-examination, Mr. Bell conceded that it would be inappropriate to cross-examine on the issue in the main action.

Mr. Froomkin submitted that there were no special rules which applied to cross-examination on affidavits in Mareva proceedings, that cross-examination of a deponent on his affidavit is the best means of testing the genuineness of his assertions and that by filing an affidavit the defendant waived his privilege against self-incrimination.

As to the scope of the cross-examination, Mr. Froomkin adopted a more robust approach than Mr. Bell and indicated his intention not only to go into the subject matter of the substantive claim, but also the Police investigation.

I must now address the question whether the defendant should be ordered to attend for cross-examination.

In Comet Products U.K. Ltd. v Hawkex Plastics Ltd.ELR(1971) 2 Q.B. 67 Cross L.J. stated that only very exceptionally should a judge refuse an application to cross-examine a deponent on his affidavit. However, in an exceptional case such as Comet Products it was clear that the cross-examination would be directed to a collateral purpose and admissions might be extracted from the defendant which might assist the plaintiffs in the action and therefore leave would be refused.

Comet Products is also instructive because of the criminal nature of the contempt alleged by the plaintiffs. In dealing with that aspect of the case Denning M.R. in quoting Bowen L.J. in Redfern v RedfernELR(1891) P. 139 at p. 147 said:

‘It is one of the inveterate principles of English law that a party cannot be compelled to discover that which if answered, would tend to subject him to any punishment, penalty, forfeiture ……….. no one is bound to criminate himself.

And in referring to the scope of the cross-examination the learned Master of the Rolls continued:

‘If the cross-examination could be limited to the particular circumstances of this alleged contempt, then it might be right to permit it.’

He then proceeded to deal with the effect of a wider...