Grenada government loses appeal in Rex Grenadian expropriation case

The Eastern Caribbean Supreme Court of Appeal has stalled the Keith Mitchell-led New National Party (NNP) government in its efforts to acquire the Grenadian by Rex Resorts in the south of the island.

A three-member Court of Appeal Justices handed down a judgment in December dismissing an appeal by the Grenada government against an earlier Supreme Court order of February 22, 2017, temporarily preventing the government from taking further steps under the Land Acquisition Act to compulsorily acquire property leased to Rex.

The 172-room hotel has a 99-year lease of the land in question with the government, which is seeking to terminate unilaterally, and to effectively expropriate the property.

In its ruling, the Court of Appeal noted that it is settled law that an appellate court would be wary of interfering with the exercise of discretion by a judge unless it is shown that the judge in exercising his discretion blatantly erred in principle or failed to take into account relevant factors or took into account irrelevant factors, or his decision was so unreasonable that it exceeded the generous ambit within which disagreement is permissible.

In last week’s issue, THE NEW TODAY carried the first part of the judgement from the OECS Court of appeal.

Following is the final part of the Judgement:

Omission of relevant matters

[17] Mr. Astaphan, QC identified the following as relevant matters which the single judge failed to take into account in considering the balance of justice: (a) there was no impediment to the acquisition; (b) no status quo to be preserved; (c) the merits of the appeal; (d) the public interest; (e) whether damages would be sufficient.

[18] Mr. Astaphan, QC submitted that the single judge failed to take into account that Adrien-Roberts J did not restrain the Crown from making a future acquisition of the property. There was therefore no impediment to the Crown acquiring the property. Also there was no challenge to the legality of the acquisition of the property. The property was therefore lawfully acquired pursuant to the provisions of the Land Acquisition Act.

There was also no status quo to be preserved since at the time of the application for an interim conservatory order and indeed at the time of the filing of the appeal the acquisition of the property had been completed.

[19] The matters referred to by Mr. Astaphan, QC are all issues which were included in the Government’s submissions before the single judge and which the single judge made reference to in his judgment. When the judgment is read as a whole it is clear that the single judge was seized of these issues and he rightly rejected the arguments of the Government on these issues.

[20] In relation to the merits of the appeal, Mr. Astaphan, QC argued that the Property was lawfully acquired and there was no challenge to the acquisition. Further, the reliefs sought on appeal being prohibition and a permanent injunction are discretionary reliefs which cannot be granted save in exceptional circumstances and not where the compulsory acquisition was not challenged. The appeal therefore has no prospect of success.

[21] Mr. Carrington, QC submitted in response that the onus was on the Crown to show that the appeal had no prospect of success and they failed to do so. No reason for the decision having been given by the lower court that was sufficient for the single judge to conclude that the appeal has a real prospect of success.

Mr. Carrington, QC further submitted that the lower court having granted a permanent injunction against breach of the covenant for quiet enjoyment, one of the issues in the appeal is whether the December acquisition was done in breach of the order of the lower court.

[22] The court allowed the appeal because the judge in setting aside the injunction had only taken into consideration whether damages would be an adequate remedy.

(23). It is a well settled rule of law that a judge should not only give reasons for his decision but that the reasons should be in sufficient detail so as to inform the parties and the Court of Appeal if necessary of the principles which the judge acted on and the reasons he came to his decision.

The reasons need not be elaborated nor is there a duty on the judge to deal with every argument advanced by counsel.

While the single judge did not mention the phrase prospect of success, or strength of the applicant’s case, or the merits of the appeal, in my view when paragraphs 9 -11 are read conjointly the single judge considered the case of both parties.

The single judge was not required to make any findings on the merits of the parties‟ case.

In the Supreme Court Practice Volume 1 the learned authors in discussing the prospect of success stated as follows:
“…The prospects of the plaintiff’s success are to be investigated to a limited extent. All that has to be seen is whether he has prospects of success which in substance and reality exist. Odds against success do not defeat him, unless they are so long that the plaintiff can have no expectation of success, but only a hope.

If his prospects are so small that they lack substance and reality, then he fails; for he can point to no question to be tried which can be called “serious” and no prospects of such success which can be called “real”.

(24). Mr. Astaphan, QC also submitted that the single judge failed to consider the public interest element in the matter. He contended that the Government has a public duty to pursue an economic developmental agenda and an injunction would effectively upend an unchallenged acquisition of property. To injunct the Crown from exercising property rights over property it has lawfully acquired is an exceptional measure which a court should only take where the acquisition itself is impugned.

He submitted that the single judge did not consider that any loss suffered by the Grenadian Hotel could be adequately compensated in damages.

(25). Mr. Carrington, QC submitted that the Crown did not put any evidence before the single judge of any prejudice that would be suffered if the order was made. Having regard to the consequences to the parties of the grant or refusal of the order, damages would not be an adequate remedy and the balance of justice was clearly in favour of making the order.

(26). As stated earlier, in cases involving a public law element, in considering where the balance of justice lies, the public law element is a special factor which the court must take into account. In this case as Mr. Carrington, Q.C. correctly submits, the Government did not put any affidavit evidence before the single judge of any prejudice if the injunction is granted nor indeed how the public interest would be affected.

(27). The authorities of Factortame and Chief Fire Officer which were relied on by the Government emphasize that a public authority acting within the law should be permitted to exercise its functions and duties for the benefit of the public. It is also in the public interest that businesses managed by private citizens should be permitted to continue to operate where their operation pose no harm to the society. In the absence of an injunction the Grenadian Hotel would have to cease its business forthwith and vacate the property. Its business is operating an international hotel. If the injunction is granted the Government would have to wait until the determination of the appeal to proceed with its venture if it is successful.

In my view the detriment to the public interest that would have occurred if the Grenadian Hotel fails on appeal does not outweigh the detriment that would be suffered if an injunction was not granted and the Grenadian Hotel was successful on appeal. Having regard to the circumstances of this case damages would not be adequate. The course that would cause the least irremediable harm was to grant the injunction.

(28). In view of the above, I am of the opinion that the single judge did not err in the exercise of his discretion in granting the injunction. In any event, even if the single judge had erred and this court was required to exercise the discretion afresh, for the reasons stated above the result would be the same. Consequently, the appeal is dismissed.

The Government shall pay the costs of the respondent to be assessed within 21 days if not agreed.

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