National Stadium Project (Grenada) Corporation v NH International (Caribbean) Limited

A notice of appeal should be struck out without a merits hearing only in a clear case where the appeal is effectively unarguable. A first appellate court must be especially cautious before shutting out an apparently serious appeal. It should not decide disputed legal or factual issues summarily where detailed inquiry is required. An appeal remains competent even if success may affect only costs, although the court retains a discretion based on overall justice. A defect in the notice should rarely justify striking out if amendment can cure it without new factual issues and prejudice can be addressed by costs.

The dispute concerned funds remaining from financing arrangements for the construction of a national stadium and sporting complex. NH claimed that the funds were held on trust for suppliers, while NS counterclaimed for a declaration that they belonged to NS. Rajkumar J found for NH and ordered payment of the frozen fund. NS appealed, but its notice did not expressly challenge a separate finding that it had no basis for claiming the fund. On NH’s application, the Court of Appeal of the Republic of Trinidad and Tobago dismissed the appeal without a merits hearing. The central issue before the Privy Council was whether that summary dismissal was justified and whether NS should be permitted to amend its notice of appeal.

The appeal was allowed. The order dismissing NS’s notice of appeal was set aside, subject to NS amending the notice to identify the basis on which it challenged paragraph 178 of the High Court judgment. The Board expressed no view on the substantive merits of the trust and assignment issues.

1. The power to strike out an appeal without a full hearing is reserved for clear cases in which the appeal is effectively unarguable. A first appellate court should be particularly careful not to shut out an apparently serious appeal unless it can be satisfied, without undue detailed inquiry, that it is not realistically arguable.
2. The approach in Credit Foncier of Mauritius Ltd v Paturau & Co (1876) 35 LT 869 had to be read in its particular context. The Board explained that the more flexible approach in Elders Pastoral Ltd v Bank of New Zealand [1990] 1 WLR 1090 required the court to exercise a discretion, even where only costs appeared to remain in issue. It was generally inappropriate to strike out an appeal where the deficiency could be cured by amendment without new factual issues or irremediable prejudice.
3. NS’s proposed case rested on construction of the contractual documents and the undisputed history. It was arguable that NS, as the entity responsible for raising and repaying the bond finance, could have a resulting trust in residual proceeds after completion of the project and repayment of the bondholders. That was sufficient to prevent summary dismissal.
4. The Board also noted, obiter, that NS might have an interest beyond costs because a freezing injunction may give rise to a claim under its undertaking in damages, and because the fund had been placed in a joint interest-bearing account indicating competing potential interests. The justice of the case therefore favoured a full hearing.

Costs submissions, if not agreed, were to be made within 21 days. The Board was minded to make the costs of the application and appeal costs in the substantive appeal.

• Privy Council: Allowed the appeal and set aside the dismissal of the notice of appeal, subject to amendment concerning paragraph 178.
• Court of Appeal of the Republic of Trinidad and Tobago: On 25 June 2012 upheld NH’s application and dismissed NS’s appeal without a hearing on the merits.
• High Court: Rajkumar J held on 28 January 2011 that the frozen fund was held on trust for NH and ordered payment with interest.