HSBC Bank Bermuda Ltd v White

• Jurisdiction: Bermuda
• Judgment Date: 24 April 2023
• Court: Supreme Court (Bermuda)
• Docket Number: Civil Jurisdiction 2017 No 81

Between:

HSBC Bank Bermuda Limit4ed

Plaintiff

and

John Percival White (Formerly Simmons)

Defendant

[2023] Bda LR 47

Civil Jurisdiction 2017 No 81

In The Supreme Court of Bermuda

Mortgage — Application to set aside default judgment — Whether defence has real prospect of success

The following cases were referred to in the judgment:

Smith v Stoneham and Stoneham [2015] Bda LR 64

Lusher v King [1997] Bda LR 14

Alpine Bulk Transport In v Saudi Eagle Shipping Co Inc “The Saudi Eagle” [1986] 2 Lloyd's Rep 221

Evans v Bartlam [1937] AC 473

M&M Construction Ltd v Vigilante [2012] Bda LR 6

Mr D Griffin for the Plaintiff

Defendant in person

RULING of Mussenden J

Introduction

1. This matter came before me by the Defendant Mr White's Summons dated 12 May 2022 which sought the following:

• (a) The order dated 24 March 2022 giving judgment to the Plaintiff (the “Bank”) in the sum of $1,029,732.79 (the “Judgment Sum”) be set aside; and

• (b) Disclosure of the sale price of the three properties, the subject of this matter, and all other costs related to the calculation of the judgment debt against him. The mortgaged properties (the “Mortgaged Properties”) are:

  • ii. 37 Spice Hill, Warwick;

  • iii. 13 Marsh Folly Road, Pembroke; and

  • iv. 23 Marsh Folly Road, Pembroke.

2. Mr White's Summons is supported by his affidavit sworn 29 April 2022 (“White 1”).

3. The Bank in response filed the third affidavit of counsel Dan Griffin sworn 30 June 2022 (“Griffin 3”). Mr White filed an affidavit in reply sworn 27 July 2022 (“White 2”).

4. There was a hearing before me on 9 February 2023 when I heard submissions. On Mr White's application, I adjourned the hearing to 2 March 2023 in order to allow him to obtain various relevant records about the Mortgaged Properties from his former counsel, Cox Hallett Wilkinson Limited (“CHW”), and to file and serve them with any submissions.

5. On 28 February 2023 Mr White filed an affidavit sworn that same date (“White 3”) along with exhibits. Some of those exhibits showed documents obtained from CHW including email correspondence between Mr White and Ms. Adenike Carmichael of the Bank.

6. On 2 March 2023, in my Chambers list, Mr White appeared as a litigant person. After some short submissions I adjourned the matter to 22 March 2023 for further submissions.

7. On 22 March 2023, I refused Mr White's application for Mr Gordon Woolridge to represent him in any capacity as Mr Woolridge informed me that the Bermuda Bar Council had refused to extend to him a practising certificate. I heard final submissions then reserved my Ruling.

Background

8. By Originating Summons dated 9 March 2017 the Bank commenced proceedings for the possession and sale of the Mortgaged Properties securing lending to Mr White of approximately $1,600,000. The Bank obtained an order for possession and sale of the Mortgaged Properties on 16 June 2017 albeit with matters left unresolved by the Judgment of Hellman J relating to a credit for rental income and the total sum due from Mr White to the Bank.

9. The Bank issued a summons on 15 February 2022 for a judgment sum in order to resolve those matters. Alison Phillips first affidavit sworn 9 March 2022 (“Phillips 1”) gave evidence for the Bank in relation to the rental income Mr White may have received had the Bank not taken possession of 37 Spice Hill prior to obtaining the necessary authority of the Court. She calculated that for the Lower North Apartment, in respect of a tenancy terminated by eviction, the loss of rental income amounted to eight months at the leased monthly rental amount of $1,300 for a total credit of $10,400 to Mr White. In respect of the Lower South Apartment, the tenant had failed to pay the rent and a judgment was obtained against that tenant. As rent was never received from this tenant during the relevant period, no credit could be given.

10. Phillips 1 also provided a detailed breakdown of the sale prices obtained by the Bank and the shortfall on the proceeds of sale of the Mortgaged Properties. The details of the sale of the Mortgaged Properties are as set out below.

• (a) The gross sale of 37 Spice Hill was $495,000. The net proceeds to the Bank were $446,109.30. The sum of $257,415.97 was applied to principal, $130,681.21 was applied to interest, and $58,012.12 was applied to the general ledger to pay off the enforcement costs through to 22 September 2017.

• (b) The gross sale price of 13 Marsh Folly was $220,000. The net proceeds to the Bank were $192,335.34. The sum of $83,623.19 was applied to principal and $108,712.03 was applied to the general ledger to pay off the enforcement costs.

• (c) The gross sale price of 23 Marsh Folly was $250,000. The net proceeds to the Bank were $211,857.98. The sum of $172,088.98 was applied to principal and $39,769 was applied to the general ledger to pay off the enforcement costs.

• (d) The amount outstanding and owed by Mr White to the Bank following the sale of the Mortgaged Properties as at January 2022 was $1,032,467.79 which comprised of $1,021,982.79 being principal and $10,485.00 being costs of enforcement.

11. The Bank obtained an order for substituted service on 15 February 2022 by newspaper advertisement as they had unsuccessfully attempted to serve Mr White personally. An advertisement appeared in the Royal Gazette on 14 March 2022 and 18 March 2022 serving Mr White. The Bank obtained default judgment on 24 March 2022.

Evidence for the application to set aside default judgment

12. The thrust of the White 1 evidence was as follows:

• (a) Mr White was in Jamaica on business from 24 December 2021 and eventually returned to Bermuda. The Bank's attorneys had knowledge that he would travel to Jamaica from time to time as he had a construction company there as well as in Bermuda.

• (b) The Bank's attorneys had corresponded with him by email...