Oasis Investment II Master Fund Ltd and Others v Jardine Strategic Holdings Ltd
| Jurisdiction | Bermuda |
| Judge | Hargun CJ |
| Judgment Date | 24 November 2022 |
| Neutral Citation | [2022] SC Bda 90 Civ |
| Docket Number | CIVIL JURISDICTION (COMMERCIAL COURT) |
| Court | Supreme Court (Bermuda) |
| Year | 2022 |
In the Matter of Jardine Strategic Holdings Limited
And in the Matter of the Amalgamation Agreement Between JMH Investments Limited and JMH Bermuda Limited and Jardine Strategic Holdings Limited
And in the Matter of Section 106 of the Companies Act 1981
BM 2022 SC 85
[2022] SC (Bda) 90 Civ.
The Hon. Chief Justice Hargun
CIVIL JURISDICTION (COMMERCIAL COURT)
2021: No. 107, 108, 109, 111, 112, 113, 114, 115, 116, 117, 118, 119, 120, 121, 123, 124, 125 & 126
In The Supreme Court of Bermuda
Application to cross-examine a deponent on his affidavit filed in relation to a discovery application; circumstances where it is appropriate to order such cross-examination
Jonathan Adkin KC, Laura Williamson of Kennedys Chudleigh Limited, Matthew Watson of Cox Hallett Wilkinson Limited, Delroy Duncan KC and Ryan Hawthorne of Trott and Duncan Limited for the Plaintiffs
Martin Moore KC and John Wasty of Appleby (Bermuda) Limited for Jardine Strategic Holdings Limited and Jardine Strategic Limited
In these 18 separate actions commenced by Originating Summonses the Plaintiffs (“the Dissenting Shareholders”) seek, pursuant to the terms of section 106(6) of the Companies Act 1981 (“the Act”), appraisal of the fair value of their shares in Jardine Strategic Holdings Limited (“the Company”). These proceedings arise out of the amalgamation of the Company with JMH Bermuda Limited (“JMH”) on 14 April 2021 (“the Amalgamation”) pursuant to the provisions of the Act, on which date JMH and the Company continued as Jardine Strategic Limited (“Jardine Strategic”). The background to these proceedings is set out at paragraphs 2 to 11 of the Judgment of this Court dated 12 November 2021 and is not repeated here.
Commencing 12 December 2022, the Court is scheduled to hear an application by certain Dissenting Shareholders seeking an order that the Defendants give discovery on the footing the documents over which they have possession, custody or power include the documents held by the following entities or their agents:
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(i) Jardine Matheson Limited;
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(ii) Jardine Matheson Holdings Limited;
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(iii) Hongkong Land Holdings Limited;
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(iv) DFI Retail Group Holdings Limited (formerly known as Dairy Farm International Holdings Limited);
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(v) Mandarin Oriental International Limited;
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(vi) Jardine Cycle & Carriage Limited;
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(vii) PT Astra International Tbk;
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(viii) Jardine Motors Group Holdings Limited;
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(ix) Jardine Pacific Holdings Limited;
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(x) Zhongsheng Group Holdings Limited (“the Principal Group Companies”).
This discovery application is supported by the second affidavit of Mr Mark Chudleigh dated 8 August 2022. In that affidavit Mr Chudleigh states at paragraph 51 that it is the Dissenting Shareholders' position that the evidence presented to the Court by the Defendants at the previous directions hearing, which provided the basis for the Order then made by the Court, together with what is apparent from the documents in fact disclosed, is consistent, and only consistent, with there being in place between the Company and at least the Principal Group Companies, and remaining in place between Jardine Strategic and the Principal Group Companies, an arrangement or understanding the effect of which was that the Defendants had and have free access to the documents of those entities.
Paragraph 51 of Mr Chudleigh's second affidavit seeks to assert that even if the Defendants may not have a legally enforceable right to the documents of the Principal Group Companies, the Defendants have practical control and as such these documents are within the possession, custody or power of the Defendants. Relying upon the line of authorities which include North Shore Ventures Ltd v Anstead Holdings Inc [2012] EWCA Civ 11, Schlumberger Holdings Ltd v Electromagnetic Geoservices AS [2008] EWHC 56, and Berkeley Square Holdings Ltd v Lancer Property Asset Management Limited [2021] EWHC 849 (Ch) the Dissenting Shareholders contend that the Defendants are obliged to give discovery of the documents which are within the practical control of the Defendants.
The discovery application is opposed by the Defendants and the Defendants' evidence in relation to the application is set out in Ms Khiyara Krige's second affidavit dated 30 September 2022 and Mr Jeremy Parr's fifth affidavit dated 29 September 2022. Mr Parr is the former Group General Counsel of the Jardine Matheson group of companies. In paragraph 11 of his affidavit, Mr Parr states that the alleged agreement or understanding referred to in paragraph 51 of Mr Chudleigh's second affidavit does not exist and, so far as he is aware, has never existed. Mr Parr positively asserts that the Defendants do not have “free access” to the documents of the Principal Group Companies (or any Group companies). He says that on conventional principles, those documents are under the control of the respective boards of each relevant Group company.
In light of the evidence of Mr Parr, the Dissenting Shareholders have made the present application under RSC Order 38, rule 2 for an order that Mr Parr attend the discovery application hearing for cross-examination on the matters arising out of his affidavit evidence relevant to the discovery application. In making this application, Mr Adkin K.C, appearing for the Dissenting Shareholders, expresses concern that the Court should not seek to determine issues which are properly going to be argued and determined by the Court at the December hearing. In the circumstances, the Court will confine itself to the narrow issue whether it should order that Mr Parr attend the December hearing for the purposes of being cross-examined on his affidavit evidence touching upon the issue of practical control. Nothing said in this judgment represents any concluded view of the Court in relation to the factual assertions made in the respective affidavits touching upon the issue of practical control.
The Company itself has made an application for an order pursuant to RSC Order 24, requiring the Dissenting Shareholders to produce for inspection the documents identified in Mr Chudleigh's third affidavit as being allegedly “inconsistent and incompatible” with Mr Parr's evidence. It is said that the application is made on the basis that the documents will assist the parties in resolving the Dissenting Shareholders' discovery application. Further, if (contrary to the Company's position) the Court was to require Mr Parr to be cross-examined, the relief sought under RSC Order 24, rule 11 would enable the Company, and Mr Parr, to understand the case which the Dissenting Shareholders would wish to put to him.
Mr Adkin KC says that the application for cross-examination of Mr Parr is based on RSC Order 38, rule 2(3) which provides that:
“In any cause or matter begun by originating summons, originating motion or petition, and on any application made by summons or motion, evidence may be given by affidavit unless in the case of any such cause, matter or application any provision of these Rules otherwise provides or the Court otherwise directs, but the Court may, on the application of any party, order the attendance for cross-examination of the person making any such affidavit, and where, after such an order has been made, the person in question does not attend, the person's affidavit shall not be used in evidence without leave of the Court.”
Mr Adkin KC relies upon the English Court of Appeal decision in Comet Products UK Ltd v Hawkex Plastics Ltd [1971] 2 QB 67 as to the proper approach to be adopted by the court in the exercise of the power set out in RSC Order 38, rule 2(3). In that case an application was made under Order 38, rule 2(3) to cross-examine the deponent accused of contempt upon his affidavit answering that allegation. In considering the exercise of the discretion conferred by Order 38, rule 2(3), Megaw LJ stated the position at page 76G as follows:
“… the judge had a discretion under RSC Ord. 38, r. 2(3) whether or not to allow cross-examination of Mr Hawkins on his affidavit. In general I think that in interlocutory proceedings, where there is a bona fide application to cross-examine a deponent on his affidavit, that application should normally be granted.”
Cross LJ expressed the approach to be taken in relation to the exercise of discretion under Order 38, rule 2(3) at page 77F, as follows:
“It is, I think, only in a very exceptional case that a judge ought to refuse an application to cross-examine a deponent on his affidavit.”
Reliance is also placed on cases which followed the approach set out in Comet Products including the decision of the Grand Court of the Cayman Islands in Jorek Shipping Company v Palmerston Chartering Co Ltd [1986–87] CILR 350 per Hull J at 357–358, this Court's decisions in Bank of Bermuda v Todd [1992] Bda LR 42, and Wong v Grand View Private Trust Co Ltd (action No 2018: 44) BM 2020 SC 67 (7 December 2020).
In considering these authorities, cited on behalf of the Dissenting Shareholders, it is to be noted that...
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