Court dismisses appeal as name change was a substantive error, not a clerical one, under Order 63 Rule 1(15).

THE SUPREME COURT

Hardiman J. 420/2005

Fennelly J.

Macken J.

SANDY LANE HOTEL LIMITED

Plaintiff/Respondent

and

TIMES NEWSPAPERS LIMITED, ZOE BRENNAN and WENDY LEITH

Defendants/Appellants

JUDGMENT of Mr. Justice Hardiman delivered the 16th day of November, 2009.

This is an appeal by the defendants from an order of the High Court, Johnson J., (as he then was) made the 7th

November, 2005, whereby the High Court granted the application of the plaintiff to substitute “Sandy Lane Hotel Co.

Limited” for “Sandy Lane Hotel Limited” in the present proceedings.

This order was made pursuant to Order 63 Rule 1(15) of the Rules of the Superior Courts.

The underlying cause of action here is libel. The plaintiff takes exception to an article published by the defendant as long

ago as the 1st March, 1998. Proceedings by the present plaintiff were instituted in June 1998. In the course of the

discovery process a variation between the name of the plaintiff, and the name of the Company shown on various Hotel

accounts was noticed. The proceedings, after discovery, went dormant between 2001 and 2004. In June of the latter

year a Notice of Intention to Proceed and a Notice of Trial were served. The present application was subsequently

brought.

The High Court judgment.

The High Court judgment was very brief and the agreed note of counsel may be set out in full:

“Having considered the affidavit’s evidence and the submissions by counsel for the parties, Johnson J., having

expressed the views during oral argument that (a) he believed that the defendants were at all times aware of the

fact that the person taking the case was the owner of the Sandy Lane Hotel and (b) that justice would not be

served if the position adopted by the defendants on the application were to succeed, ruled as follows:

‘I will grant an order in terms of the plaintiff’s Notice of Motion. In my view there is no injustice in so doing.’ ”

The Notice of Motion.

The Notice of Motion seeks an order “pursuant to Order 63 Rule 1(15) of the Rules of the Superior Courts for the

correction of the name of the plaintiff in these proceedings to “Sandy Lane Hotel Co. Limited”.

Order 63, Rule 1(15) provides that the Master of the High Court may make:

“An order for the correction of clerical errors or errors in the names of parties in any proceeding, whether on

consent or not, but subject to re-service when not on consent.”

The issue of this appeal may be stated simply: the plaintiff claims that the present application is within the rule just cited.

The defendant denies this and says that the application should more properly be brought under Order 15, Rule 2 or Order

15, Rule 13 of the Rules. The defendant does assert that if the plaintiff were to bring an application under the last

mentioned rules, it would not only contend that there was no mistake made but would further contend that the

application should not be granted because the cause of action in the proposed plaintiff is statute barred. It would make a

similar submission in relation to an application under Order 15, Rule 13.

The facts.

The Sandy Lane Hotel is a very widely known luxury hotel in Barbados. Since 1961 it had been operated by a Barbados

Company called Sandy Bay Hotel Limited. This company owned the hotel, its grounds, and an adjacent golf course. At

some stage it became part of the Trust Houses Forte Group.

In 1996 there was a sale to a “consortium of businessmen” by the Trust Houses Forte Group and this was achieved by

selling the Company to a St. Lucia Company, Sandy Lane Hotel Limited. This Company then bought Sandy Bay Hotel

Limited, which seems to have been a Barbados Company. About the same time a further Barbados Company, Sandy Lane

Properties Limited was set up so that it could purchase some 500 acres of land 2 kilometres from the hotel but touching

the furthest point of its grounds.

Sandy Lane Properties Limited is in turn owned by another St. Lucia Company, Sandy Land Holdings Limited. The effect of

all this is that the two Barbados Companies, Sandy Bay Hotel Limited and Sandy Lane Properties Limited, were owned by

two St. Lucia Companies, Sandy Lane Hotel Limited and Sandy Lane Holdings Limited.

On the 22nd April, 1997, Sandy Bay Hotel Limited, the Company which both owns and operates the Sandy Lane Hotel,

changed its name to Sandy Lane Hotel Co. Limited. That is how and when the proposed plaintiff came into being.

All of these complex corporate transactions were carried out for tax planning purposes and to facilitate acquisitions.

The above account is based on a letter from the plaintiff’s solicitors, William Fry and Company of the 16th May, 2005 and

on the affidavit of Brian O’Sullivan of the 11th June, 2005.

Mr. O’Sullivan is the Company secretary of the present plaintiff. He says frankly that:

“At the time of change of name in 1997, I thought nothing of the inclusion of the word ‘Co.’ in the title of the

plaintiff.

Indeed, when the article appeared in the Sunday Times, and when proceedings were subsequently issued, I

understood the name of the plaintiff company was Sandy Lane Hotel Limited. It was only when the issue was

recently drawn to my attention that I recalled that the word ‘Co.’ had in fact been included in its title on the

initiative of [a Barbados lawyer] as set out above.”

He further says that:

“The reason the error [that is, the alleged error in the name of the plaintiff] occurred is that the inclusion of the

word ‘Co’ in the name of the plaintiff was not originally intended.”

It may be noteworthy that in the written submissions of the plaintiff, what they say is an error in the plaintiff’s name in

the title of the proceedings is called “a clear case of an administrative error”.

They go on to submit that the plaintiff in making the present applicant:

“was not seeking to add a new party or to substitute a different party for the party who instituted the

proceedings. It was simply seeking to correct an error in the name of the plaintiff as appearing in the title of the

proceedings… this is not a case of the wrong plaintiff suing the defendant. The proceedings were issued on behalf

and with the instructions of Sandy Lane Hotel Co. Limited through administrative inadvertence, the plaintiff was

named as “Sandy Lane Hotel Limited” in the title to the proceedings.”

The plaintiffs then go on to characterise the defendant’s opposition to the application as “opportunistic”. They say “as a

matter of happenstance, the plaintiff’s parent has the name Sandy Lane Hotel Limited. It is this happenstance that

permits the defendants the opportunity to contend that the plaintiff ought to have applied for an order of substitution of

one party for another as the plaintiff under Order 15 as opposed to Order 63.”

The Companies, of course, bear the names the “consortium” chose, and altered when they pleased. This is not

“happenstance”.

The submissions quoted above, in my view, go to the nub of the case. I am not sure that they are helpful to the plaintiff.

Order 63 Rule 1(15), which is a relief that may be granted ex parte by the Master, relates to “the correction of clerical

errors or errors in the names of parties in any proceeding”.

This is to be contrasted with Order 15 Rule 2 which provides:

“Where an action has been commenced in the name of the wrong person as plaintiff, or where it is doubtful whether

it has been commenced in the name of the right plaintiff, the court may, if satisfied that it has been so commenced

through a bona fide mistake, and that it is necessary for the determination of the real matter in dispute so to do,

order any other person to be substituted or added as a plaintiff upon such terms as may be just.”

Order 15 Rule 13 provides:

“No cause or matter shall be defeated by reason of the mis-joiner or non-joiner of parties, and a court may in every

cause or matter deal with the matter in controversy so far as regards the rights and interests of the parties

actually before it. The Court may at any stage of the proceedings, either upon or without the application of either

party, and on such terms as may appear to the court to be just, order that the names of any parties improperly

joined, whether as plaintiffs or as defendants, be struck out and the names of any parties, whether plaintiffs or

defendants who ought to have been joined or whose presence before the court may be necessary in order to

enable the court effectually and completely to adjudicate upon and settle all questions involved in the cause or

matter, be added…”.

In construing Order 63 Rule 1(15) it is necessary first to note that the term “clerical error” has been the subject of judicial

decisions.

In R. v. Commissioner of Patents, ex parte Martin [1953] 89 CLR 381, Fullager J. held that:

“… the characteristic of a clerical error is not that it is in itself trivial or unimportant, but that it arises in the

mechanical process of writing or transcribing.”

In a later case, re Meres Application [1962] RPC 182 the term “clerical error” was described as follows in another patent

case, in words which plainly followed the case cited above:

“The words ‘clerical error’ must, I think, be taken to mean a mistake made in the course of a mechanical process

such as writing or copying as distinct from an order arising, e.g. from lack of knowledge, or wrong information, in the

intellectual process of drafting language to express intentions.”

Having regard to the structure of Order 61 Rule 1(15) I believe that the phrase “errors in the names of parties” must be

construed in the same sense as the proceeding phrase, with which it is “eiusdem generis”, “clerical errors”. Either

category of error must be construed in contradistinction from another sort of error arising from “lack of knowledge or

“wrong information…”. It appears to me, from a consideration of Mr. O’Sullivan’s affidavit on behalf of the plaintiff, that

the mistake made in this case is not one which can be described as a clerical error, or anything like it. He frankly admits

that the name “Sandy Lane Hotel Co. Limited” was not originally intended to be used in the proceedings. This was

because, although he knew of the history of the companies, it was not present to his mind, or to the mind of the lawyers,

that the company actually operating the hotel was the Sandy Lane Hotel Co. Limited. This in turn was because, as he

very frankly says “At the time of the change of name in 1997 I thought nothing of the inclusion of the word ‘Co.’ in the

title of the plaintiff.”

This is not in my view a clerical error. The error here arose due to a mistaken belief and a failure to ascribe any

significance to the change of name of 1997. This is a misguided state of mind with which one cannot have much

sympathy, given that it was made by or on behalf of “a consortium of businessmen”, in the course of a complicated series

of arrangements made for tax planning purposes, in which they obviously had the benefit of the best legal and taxation

advice.

The consortium running the Sandy Lane Hotel were of the view that it was important for corporate or tax planning

purposes that the entity operating the hotel should be the Sandy Lane Hotel Co. Limited. Nor did this simply involve a

change of name: there was another, completely different, Company called the Sandy Lane Hotel Limited. The operating

Company was a Barbados Company but the latter Company, which appears as plaintiff at present, is a St. Lucia Company.

The plaintiff’s case would in my opinion have been a stronger one if they had simply failed to get the name of the

operating company right. But in the events that happened they actually used the name of an entirely different Company,

which however appears to be the parent Company of the operating Company. This in my view is not a clerical error or

anything similar to a clerical error. It requires, if it is to be remedied, the substitution of a new entity which co-existed

the plaintiff at all material times. Because of the delay (and there has been gross delay) the defendants might be able to

object to the substitution of a new party on the grounds that the statute of limitations has run as against that party.

Since this is a separate issue which may well come before the courts, I will say nothing about it. But I would not be

prepared to deprive the defendants of the opportunity of raising it.

I do not believe that this is an application appropriate to Order 63 Rule 1(15) and would therefore allow the appeal and

refuse the relief sought by the plaintiff.