British American Insurance Company v Cross

• Jurisdiction: Bermuda
• Judgment Date: 29 March 2010
• Date: 29 March 2010
• Docket Number: Civil Jurisdiction 2001 No. 232
• Court: Supreme Court (Bermuda)

In The Supreme Court of Bermuda

Civil Jurisdiction 2001 No. 232

BETWEEN:

BRITISH AMERICAN INSURANCE COMPANY

Plaintiff

v

KAREN CROSS

Defendant

Mr K Taylor for the Plaintiff

Mr J Durham for the Defendant

The following cases were referred to in the judgment:

Gijsels v BelgiumHRC (1998) 25 EHRR 1

Blunt v Park Lane HotelELR [1942] 2 KB 253

AT&T Istel v TullyELR [1993] AC 45

Memory Corp v SidhuELR [2000] Ch 645

Bank of Bermuda v ToddBDLR [1992] Bda LR 42

Alpine Bulk Transport Co Inc v Saudi Eagle Shipping Co IncUNK [1986] Lloyd's Rep 221

Abstract:

Stealing by employee - Application to set aside default judgment - Whether real prospect of success

RULING of KAWALEY, J

Procedural history

1. On July 16, 2001, the Plaintiff issued its Writ for damages in excess of $300,000 allegedly stolen by the Defendant while in the Plaintiff's employ. On December 19, 2001, the Defendant filed a Re-Amended Defence and Counterclaim admitting in paragraph 1 that she owed the Plaintiff "approximately $200,000". She asserted the right to set off various sums claimed in her Counterclaim totalling in excess of $175,000, most of which was a pension claim.

2. The action was eventually stayed pending a criminal trial which resulted in the Defendant being convicted of stealing some $31,675.60 from the Plaintiff in the course of her employment. This amount was determined by the Chief Justice on August 23, 2004, following a Newton hearing, after the Defendant pleaded guilty to three counts on a six count indictment in which a general deficiency was relied upon rather than specific amounts. Trial was initially fixed for October 16, 2006 on which date the matter was adjourned pending determination of the admissibility of admissions made by the Defendant in her contempt of court committal proceedings.

3. It does not appear to me from the record that these admissions in the civil committal proceedings played any part in the pleaded cases on which the Default Judgment was crucially based. The Defendant applied to re-amend her Defence in the form of a draft pleading which admitted owing the Plaintiff "approximately $200,000". This application was granted, over the Plaintiff's opposition, by Wade-Miller J on December 13, 2001 on the grounds that "it is clear that the Defendant has an arguable case" (Ruling, page 2). It is this pleaded admission that the Plaintiff has relied upon in the present application, not any other admissions made in the course of the contempt application. The only other admission relied upon, which was admittedly less explicit, was the Defendant's implied admission when first told by her employer that she had stolen sums in excess of $300,000. This occurred before the present proceedings had even been commenced.

4. It had long become clear that the only issues in dispute in the present action were (a) the quantum of the Plaintiff's claim, and (b) the merits and quantum of the Defendant's Counterclaim. After early skirmishes around discovery and quantum and

access to pension monies, the action seemingly went to sleep between 2007 and 2008. On February 5, 2009, the action was ordered to be tried. By the same Order, I directed the Plaintiff to produce "route supplementary and cash turning sheets created during the period the period of the Defendant's employment and relevant to the Plaintiff's claim". This was to enable the Defendant to substantiate her claim that the sums that she misappropriated were not as great as the Plaintiff alleged. I also directed the Defendant to supply (a) particulars of the sums she admitted owing within 28 days of the Plaintiff's production and (b) particulars of her counterclaim for medical expenses on or before March 31, 2009. On February 12, 2009 the Defendant's initial attorneys ceased acting. Shortly thereafter, the Defendant retained her second set of attorneys.

5. It is accepted by the Defendant that she attended the Plaintiff's offices on or about April 29, 2009 to inspect certain documents after she had attended the Plaintiff's attorneys offices with her then lawyer on March 19, 2009 to review documents produced pursuant to the February 5, 2009 Order. No complaints were made about the adequacy of the disclosure made. On March 31, 2009, the Plaintiff applied for an Order striking out the Defence for non-compliance with the February 5, 2009 Order. This application was initially heard on April 23, 2009 when the Defendant's counsel was unable to appear. Mr. Taylor advised the Court that his opponent had on April 2, 2009 promised to supply the requisite particulars by the first return date of the Plaintiff's Summons.

6. On April 23, 2009, I ordered that unless the Defendant complied with paragraphs 2 and 3 of the February 5, 2009...