Raier v Correa and others
9 June 2023, Grand Court of the Cayman Islands, Financial Services Division.
Richard Morgan KC and Rosanna Foskett acted for the successful Defendants, instructed by Richard Annette and Adam Russell-Knee of Stuarts Walker Hersant Humphries.
The underlying substantive proceedings involve a shareholder dispute over a Cayman-incorporated group of companies. The Plaintiff brought proceedings for rectification of the share register of a Cayman-incorporated company and for permission to bring a derivative claim on behalf of the company against a director. The Plaintiff joined parties in Chile and Barbados and had sought on an ex parte basis orders for permission to serve the proceedings out of the jurisdiction, for permission for substituted service by various different means and for an order extending the validity of the writ beyond its initial period of validity. One Defendant applied to strike out the summons and two other Defendants applied to set aside the ex parte orders. All three Defendants were successful.
The Court set aside the ex parte orders against two Defendants for failures of full and frank disclosure and fair presentation duties. There was no re-grant. In particular, the Court criticised the Plaintiff for:
- not putting proper evidence before the Court at the ex parte stage explaining what was and was not valid service under the law of the jurisdictions in which service was to take place (Chile and Barbados);
- repeatedly giving the impression to the Court in evidence and in submissions that the Chilean- and Barbados-based Defendants had evaded or might seek to evade service when there was no proper justification for making that allegation;
- failing to take proper steps to locate the Barbados-domiciled Defendant when they found out that it had been re-domiciled away from the Cayman Islands;
- delaying in seeking permission to serve the proceedings out of the jurisdiction.
The Court concluded that the Plaintiff made errors because of “an aggressive, unfair and unbalanced approach” to the ex parte proceedings.
The Court struck out the proceedings against the other Defendant on the basis that there was no reasonable cause of action against it. It was not justifiable to have joined it as a party to the proceedings and no claim was made against it.
The Judgment sets out helpful summaries of the principles relating to:
- the duties of full and frank disclosure and fair presentation on ex parte applications;
- permission to serve proceedings outside the jurisdictionl;
- substituted service; and
- the extension of validity of a writ.
These are very similar to English law principles, but the Judgment refers to a number of useful recent Cayman cases on these issues.
A link to the judgment can be found here.