Beatson JA, Goldring P, Moses JA
IN THE CAYMAN ISLANDS COURT OF APPEAL
ON APPEAL FROM THE GRAND COURT OF THE
CAYMAN ISLANDS CIVIL DIVISION
CICA (Civil) Appeal No. 0002 of 2023
(Formerly Cause No. GC 0073 of 2021)
BETWEEN
(1) SAMUEL REID
(2) MERVELIN REID
APPELLANTS
AND
LOOKOUT HOLDINGS LIMITED
RESPONDENT
Before:
The Rt. Hon. Sir John Goldring, President
The Rt. Hon. Sir Alan Moses, Justice of Appeal
The Rt. Hon. Sir Jack Beatson, Justice of Appeal
Appearances
Mr. James Chapman, Chapmans Legal Ltd for the
Appellants
Mr Colm Flanagan and Ms Amanda Minto, Nelsons for the
Respondent
Heard:
30 August 2023
Draft circulated:
8 September 2023
Judgment delivered:
22 September 2023
JUDGMENT
Moses, JA
1.
This is an appeal against a judgment of the Honourable Kirsty-Ann Gunn (Acting)
dated 8 February 2023 in which, in an action brought by the respondents (Lookout)
CICA (Civil) Appeal No. 0002 of 2023 – (1) Samuel Reid (2) Mervelin Reid v Look Out Holdings Ltd – Judgment
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against the Appellants, she declared that a series of agreements entered into between
Lookout and the appellants (Mr and Mrs Reid) had been terminated and made
consequential orders including an order that Mr and Mrs Reid give vacant possession
of parcel 235, the land the subject of the dispute.
2.
On 30 August 2023 the court heard the appeal and dismissed it. These are the court’s
reasons.
3.
The facts found by the judge are central to this appeal. Before identifying some of the
relevant facts I should record that they were found by the judge after a two-day trial in
which the Reids’ credibility was much in issue. In reaching her conclusions of fact,
the judge rejected important aspects of their account of their dealings with Lookout.
4.
In this appeal the appellants, through their counsel Mr Chapman, accepted that it was
not open to him to challenge those factual findings. He was right to do so. The
judge’s factual findings could not be overturned unless it could be shown that she had
reached a conclusion she was not entitled to reach (see e.g. Henderson v Foxworth
Investments Ltd [2014] 1 WLR 2600 at [67].
5.
Lookout sells parcels of land in Bodden Town for the development of single-family
homes. For the assistance of those who may not be able to afford the deposit
necessary to obtain a mortgage, it has developed a scheme which gives an opportunity
for a prospective purchaser to pay a deposit over a one-year period. At the end of that
period, a prospective purchaser may either pay the remaining purchase price, either
with a mortgage or from their own funds or through a finance agreement with
Lookout. Lookout retains title to the land until the purchase price has been paid in
full.
6.
On 23 April 2018 Mr and Mrs Reid entered into an agreement described as a Deposit
Agreement which read:
“We Lookout Holdings Ltd agree to hold the aforesaid Parcel 235 on the basis
that the purchase price is CI $118,108.00 and a deposit of CI $1,108.00 has
been paid as of April 23 2018. The remaining balance of CI $117,000.00 will
CICA (Civil) Appeal No. 0002 of 2023 – (1) Samuel Reid (2) Mervelin Reid v Look Out Holdings Ltd – Judgment
be paid by monthly instalments of CI $500.00 commencing on June 1 2018.
The remaining balance will be interest free for the first year, as long as all
monthly payments are made on a timely basis. In the event that any monthly
payment is not made within seven days of the due date, Lookout has the option
to either terminate this agreement and return all funds paid to date or charge
interest, 10% per annum from the default date for the remainder of the term.
The purchaser will have three options to pay the outstanding remaining
balance on the first day of (12 months after first 500 payment), May, 1 2018.
1) pay the remainder in full
2) obtain a bank mortgage for the remaining balance or
3) financing will be available through Lookout Holdings Ltd on terms and
conditions to be agreed.”
7.
The Judge found, contrary to the evidence of the Reids, that Mr Reid had made only
one payment of $3500 between May 2018 and April 2019, that the Reids were in
breach of the deposit agreement and that, accordingly, Lookout was entitled to
terminate the agreement (Judgment [29]. Numbers in brackets hereafter refer to the
judgment).
8.
In late December 2018 the Reids built a “dwelling structure” on the Plot. The Judge
rejected the evidence that they had been encouraged to do so. On the contrary they
were told they could not do so [28]. Later she described the fact that they had spent
money on filling what was otherwise swamp land and building a small dwelling as
“most unfortunate” but “a misfortune of their own making” [66].
9.
On 5 April 2019 Lookout served a termination letter, and asked the Reids to vacate
the Parcel immediately. Mr Reid acknowledged receipt of the letter but pointed out
that although the letter said it contained a cheque for the return of $4608 paid to date,
no cheque was enclosed. This was correct. The cheque was to be kept until the land
was vacated. The money was, however, offered by Ms Hurlston, the office manager,
but Mr Reid, as the Judge found, refused to take it [42].
CICA (Civil) Appeal No. 0002 of 2023 – (1) Samuel Reid (2) Mervelin Reid v Look Out Holdings Ltd – Judgment
10.
The Judge found that two further irregular payments, as she described them, were
made one of $1000, the day following the termination letter and another of $2000, on
14 June 2019. Both were unsolicited [43]-[44]. Despite a letter from Lookout’s
attorneys dated 17 July 2019, the Reids remained in occupation. This led to a meeting,
the details of which were disputed.
11.
The Judge found, accepting the evidence of Lookout’s Office Manager and Director
and rejecting the evidence of the Reids, that on 5 August 2019, the parties orally
agreed that the arrears owed, agreed at $1000, would be paid forthwith, the remaining
purchase price would be paid in full by the end of September 2019, various works of
extension, clearing and repair would be undertaken, and the house completed within
12 months.[46]
12.
The Judge found that none of those terms were met. In particular, no further payments
were made [56]-[58].
13.
On 22 July 2020, Lookout sent a letter telling the Reids they were in breach of the
second August 2019 agreement and requiring them to vacate.
14.
They did not. On 25 July 2020, Lookout and the Reids entered into a third agreement
on the same terms as the second, August 2019 agreement but with a date for payment
of the full price changed to September 2020. [60]-[61].
15.
No payments were made between July 2019 and August 2020 but some sporadic
payments were made thereafter. By 8 August 2020 despite a payment of $3000, Mr
and Mrs Reid were still in arrears and were in breach of the agreement to pay the full
purchase price by September 2020.[62]-[63]
16.
Lookout served a further letter on 8 April 2021 terminating the third, July 2020,
agreement.
17.
On the basis of those facts the Judge concluded that Lookout had validly terminated
all three agreements and that consequently the Reids remained in illegal possession of
the land [64] and [68].
CICA (Civil) Appeal No. 0002 of 2023 – (1) Samuel Reid (2) Mervelin Reid v Look Out Holdings Ltd – Judgment
18.
Mr Chapman on behalf of the Reids points out that they were unrepresented and
asserts that they must have found the approach of Lookout, in making further
agreements, after the termination of the initial agreement, confusing. There is no
finding to support this assertion. The Reids gave evidence which demonstrates they
understood the issues, and knew what they were required to do. Their evidence was
disbelieved.
19.
Mr Chapman argued that the initial Deposit Agreement was never validly terminated
but that, by accepting and not rejecting a number of unsolicited payments, Lookout is
shown either not to have accepted the Reids’ repudiatory conduct or is, in some way,
estopped from reliance on its purported termination.
20.
This submission is not sustainable. The facts show that there were three linked but
separate agreements. There was a valid termination of all three agreements. The fact
that Lookout chose to enter into two further agreements did not, in any way, debar
them from relying on the termination of all three, once, as the Judge found, the Reids
had failed to comply with the terms of those agreements.
21.
Lookout did not waive its right to terminate the first deposit agreement when it
entered into a second agreement in August 2019. That first agreement was ended. Had
the Reids complied with the terms of that second agreement they would eventually
have been entitled to purchase the land. But when they failed to do so, Lookout was
entitled to terminate that agreement and did not waive that right by entering into a
third agreement in July 2020. Again, when the Reids failed to comply with the terms
of that third agreement, Lookout was entitled to terminate it.
22.
The Reids never acquired any interest in the land. Mr Chapman seemed to suggest
that since the infill and building work was obvious and valuable that conferred on
them some right not to be evicted. This was not properly arguable. It seemed to be
suggested that some form of estoppel had been created in reliance on promises from
Lookout. But no promises were ever made by Lookout. On the contrary, the Reids
knew they should not have spent money on infill and building on land which they had
never acquired.
CICA (Civil) Appeal No. 0002 of 2023 – (1) Samuel Reid (2) Mervelin Reid v Look Out Holdings Ltd – Judgment
23.
The case raised questions only of fact. There was no arguable misapplication of the
law which was straightforward. The judge reached the right conclusions for the right
reasons. It was for those reasons the court dismissed this appeal.
CICA (Civil) Appeal No. 0002 of 2023 – (1) Samuel Reid (2) Mervelin Reid v Look Out Holdings Ltd – Judgment