First Citizens Bank (Barbados) Ltd v Jennifer Roseanne Hobbs
| Jurisdiction | Barbados |
| Judge | Madam Justice Sonia L. Richards |
| Judgment Date | 21 June 2020 |
| Neutral Citation | BB 2020 HC 5 |
| Court | High Court (Barbados) |
| Docket Number | CV No. 1624 of 2015 |
| Date | 21 June 2020 |
IN THE SUPREME COURT OF JUDICATURE
HIGH COURT
CIVIL DIVISION
Dr. The Hon. Madam Justice Sonia L. Richards, Judge of the High Court.
CV No. 1624 of 2015
Ms. Richelle M. Nichols, Attorney-at-Law of Clarke Gittens Farmer for the Claimant.
Ms. Sharon Parris, Attorney-at-Law for the Defendant.
This is an application by the Defendant for costs, arising out of an application by the Claimant, as a mortgagee, for possession of the mortgaged property.
By a Facility Letter dated 07 March 2008, the Claimant offered the Defendant a demand loan in the sum of $157,500.00. The loan was repayable over fifteen years by monthly instalments of $1,736.12, inclusive of interest. The Defendant agreed to the terms in the Facility Letter, and the loan was secured by a deed of charge by way of legal mortgage over land owned by the Defendant. The mortgage deed was executed on 10 July 2008.
The Defendant fell into arrears with her repayment of the loan. By letter dated 14 February 2014, counsel for the Claimant demanded full payment of the outstanding principal ($112,772.76); interest ($5,863.22); late fees ($989.24); and legal expenses ($305.00).
A statutory notice dated 02 June 2014 was issued to the Defendant demanding payment of the outstanding principal, with interest due at the date of payment. The Defendant was given one month from the date of service of the notice to comply, failing which the Claimant would take steps to sell the mortgaged property.
Counsel for the Claimant forwarded a pre-action protocol letter to the Defendant dated 05 February 2015. The amounts demanded on behalf of the Claimant were principal ($100,768.84); interest ($3,829.56); late fees (1,309.24); legal fees (3,500.00); and additional interest to be calculated at $23.32 per day from 06 February 2015 until payment.
Nine months later the Claimant filed its claim for possession of the mortgaged property, further or other relief and costs. The matter came on for hearing before this Court on 09 February 2016. A consent order was made for both parties to file supplemental affidavits.
At the reconvened hearing on 21 June 2016, the Claimant's counsel informed the Court that the Claimant had instructed counsel to withdraw the application because the Defendant was up to date with her payments. Consequent upon this development, counsel for the Defendant asked for costs.
The claim was accompanied by the affidavit of the Claimant's collections officer Cynthia Cave. This affidavit referred to principal ($90,753.48): arrears ($4,364.20); interest ($1,405.02); and fees ($1,549.24). The Cave affidavit annexed all the documents referred to at paragraphs [2] to [5] supra.
The Defendant's first affidavit was filed on 14 January 2016. She admitted defaulting on principal and interest repayments, but asserted that the loan was now up to date. The Defendant also contended that after meeting with counsel for the Plaintiff in March 2015, an agreement was brokered for the Defendant to bring the loan account up to date. That agreement was embodied in correspondence from counsel to the Defendant dated 26 March 2015. The correspondence stated inter alia:
“Our client has reviewed and given consideration to your proposal provided on the 19 th day of March 2015. In this regard our client has indicated its willingness to accept your proposal on the following conditions —
1. That payment of the sum of $5,000.00 shall be made on or before March 31, 2015;
2. That payment of the sum of $6,111.36 shall be made on or before April 30, 2015 to settle all outstanding arrears;
3. That payment of the sum of [$1,736.12] be made on or before May 31, 2015 and shall continue each month thereafter;
4. That payments shall be made monthly without any lapses.
Please note that if you should fail to make the payments as agreed above, our client reserves all rights to institute legal proceedings against you without further notice.
Our client's rights herein are expressly reserved”. (See Exhibit JRH 1).
The Defendant also exhibited receipts for loan repayments made between 18 March 2015 and 28 December 2015. These repayments totaled $28,600.00 (Exhibit JRH 2). In addition, the Defendant questioned the sum of $1,549.24 referred to at paragraph 21 of the first Davis affidavit as fees due to the Claimant. The Defendant says that she does not know whether these fees were incurred, and if incurred, whether they are reasonable.
The Claimant responded with its second Davis affidavit filed on 29 February 2016. Davis pleaded that when the claim was filed the arrears on the Defendant's account were $1,100.00, and that a cheque for $2,500.00, tendered by the Defendant on 17 October 2015 had to be returned. Davis conceded that the Claimant's counsel had issued the correspondence of 26 March 2015 to the Defendant. (See paragraph [9] supra). However, a follow up letter dated 14 May 2015 was sent to the Defendant.
The letter of 14 May 2015 is in these terms:
“We refer to……our letter of March 26, 2015.
As at March 17, 2015 the arrears on your account totalled the sum of $ 11,111.36. On March 19, 2015 you attended our office and proposed to clear the arrears by instalments of $5,000.00 by March 31, 2015 and $6,111.36 by April 30, 2015. However, your said proposal failed to take into account that your regular monthly payment of $ 1,736.12 would be due and owing at the end of both March and April 2015.
Our client acknowledges receipt of the following payments:
— $5,000.00 on March 19, 2015;
— $2,500.00 on April 10, 2015;
— $2,500.00 on April 21, 2015; and
— $1,700.00 on May 6, 2015.
However, at May 13, 2015 the amount required to clear all arrears was the sum of $2,883.60. In light of the foregoing you are required to clear the said arrears in the sum of $2,883.60 on or before May 30, 2015 as well as to pay the agreed monthly payment of $1,736.12 on or before May 28, 2015. You are also therefore required to maintain monthly payments of $1,736.12 on or before the 28 th day of each and every succeeding month until the facility is liquidated. All payments] must be made monthly without lapses.
Please note that should you fail to make the payments as set out above, our client reserves its rights to institute legal proceedings against you without further notice.
Our client's rights herein are expressly reserved”. (Exhibit CC1 annexed to affidavit filed on 29 February 2016).
With respect to the fees queried by the Defendant, Davis explained that $1,549.24 were late fees due to the Claimant “as a result of the Defendant's failure to make payments due under the mortgage in time”. (See para.6. of affidavit). Davis added that the Claimant was authorised to charge late fees under clause 3 of the Facility Letter, and clause 1.01 of the mortgage deed. Davis maintained that the Claimant had the right to file its action against the Defendant.
A second and final affidavit was filed by the Defendant on 08 April 2016. The Defendant again admitted default in the repayment of the principal and interest due on the loan. However, she insisted that she was not in default of the arrangement made between herself and the Claimant's counsel. The demand for her to continue paying the monthly instalments of $1,736.12, together with the arrears, was communicated in the letter of 14 May 2015. When this letter was posted by counsel for the Claimant, the arears were $1,083.60, and not $2,883.60. She provided evidence of a payment of $1,800.00 on 15 May 2015, the same days that counsel's letter was posted to her.
The Defendant further alleged that she made a number of payments between 10 June 2015 and 14 September 2015. The cheque returned to her in October 2015 was rectified and returned to the Claimant on 27 October 2015. By this time the arrears were $128.08
With respect to the fees charged by the Claimant, the Defendant says that these charges were debited from her account. However, she was never made aware of the amount of the late fees, and the receipts she received were neither timely nor adequate. In her own words, “[W]hile I have expressly agreed to indemnify the [Claimant] there is an implied term that if these fees are for my account I should receive timely information regarding the same and that they should be reasonable”.
Counsel for the Claimant confirmed in the letter of 14 May 2015 that at that date the Defendant's arrears were $2,883.60. If one adds to this figure the monthly mortgage instalment of $1,736.12, the total due to the Claimant by the end of May was $4,619.72. However, an account must be taken of a payment of $1,800 made on 15 May 2015. Therefore, by May 30 th, the Claimant was owed $2,819.72 and not $4,619.72.
The loan was still in arrears between 15 June 2015 and the end of September 2015, because no payments were made in July 2015. And three additional payments of $1,800 during that period appear to have been insufficient to absorb all the arrears. Two payments totalling $5,000 were made in October 2015 before the claim was filed.
Ms. Davis asserted that at the time of the filing of the claim the Defendant's arrears were $1,100.32. (Para.5 of second Davis affidavit). This is less than the $4,364.20 claimed as arrears in her first affidavit. The lesser figure in the second affidavit appears to be based on the assumption that one of the cheques tendered by the Defendant in October was returned to her. The Court accepts that the Defendant tendered a replacement cheque thereafter, and in October, for $2,500. This was more than the $1,100.32 now said to be due to the Claimant as at 13 November 2015.
The Claimant offered no additional evidence to establish that between the receipt of the...
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