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NEWS
RECENT CASES OF INTEREST
1. PRICEWATERHOUSECOOPERS VERSUS PURSEM AND GOORIAH [2018] SCJ.
On 1st May 2014, Messrs. M. Oosman and Yogesh Basgheet were appointed special administrators of BAI Co. (Mauritius) Ltd and its related companies by the Financial Service Commission (F.S.C.).
The special administrators had an working arrangement with Pricewaterhousecoopers Ltd (PwC) in order that the latter provides them with accountancy and administrative support.
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The special administrators were entitled to call for external specialist advice on legal matters. In that context, the services of lawyers, namely, Messrs. Clarel Benoit (Barrister), Rishi Pursem SC (Barrister), Rajesh Bucktowonsing SA (Attorney) and Dharmalingum Goorriah (Notary) were used.
Messrs. Clarel Benoit , Rishi Pursem and D. Gooriah (the Claimants) contend that they contracted with PwC. They thus served upon PwC statutory demands claiming respectively Rs 31,169,187.15 Rs 2,012,500 and Rs 381,800. The statutory demands pertain to liquidated sums allegedly due to each of the three abovenamed with respect to professional services rendered in connection with the special administration and conservatorship of the BAI Group, together with disbursements.
The Claimants invoke the prism of “stipulation pour autrui†in support of their argument. According to them, the situation between the parties through the prism of stipulation pour autrui would yield the following cast: the Special Administrators, as “stipulantsâ€, Messrs Gooriah, Pursem and Benoit as “promettants†and the Applicant as “tiers bénéficiaireâ€.
They also attempted to justify their Statutory demand by placing reliance on the institution of délégation (article 1275 of the Mauritian Civil Code).
PwC had lodged three separate applications for the setting aside of these statutory demands. The three cases were consolidated. The contention of the PwC is that it not indebted to Messrs. Benoit , Pursem and Gooriah there is a substantial dispute inasmuch as it has never contracted with the latter, it has a serious defence to the claim.
The hearing of PwC’s applications was completed on the 22nd May 2018.
In a judgment delivered on the 12th June 2018, the judge stated that her task when dealing with such setting aside applications of a statutory demand is as explained in Mibor Investments Pty v Commonwealth Bank of Australia (1994) 2 VR 290, not to embark upon any extended enquiry in order to determine whether there is a genuine dispute between the parties and not to attempt to weigh the merits of that dispute. All that the legislation requires is that the Court conclude that there is a dispute and that it is a genuine dispute.
The judge decided that given PwC had laid a proper foundation for the dispute, there were hotly contested issues which needed further investigations that could only be resolved after hearing viva voce evidence.
In consequence, the learned judge granted PwC’s applications and set aside the three statutory demands
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LANDMARK CASES
1. MAURILAIT PRODUCTION LTEE V LA LAITERIE DE CUREPIPE [2017] SCJ 125.
Maurilait Ltée (“Maurilaitâ€) has, since February 1980, been producing, commercializing, marketing and selling curdled milk under the name of “Dahi†and since 1981 under the name “Super Dahiâ€. READ MORE >
In 1981, Maurilait obtained a court order restraining La Laiterie de Curepipe (“La Laiterieâ€) from using the words “Dahi†and/or “Super Dahi†on curdled milk which it was selling to the public. In 2010, Maurilait obtained a perpetual writ of injunction prohibiting Innodis Ltd from commercialising or selling commodities and products under the name “Dahi†written in any manner whatsoever on its packaging. In February 2011, it came to the knowledge of Maurilait that La Laiterie was distributing/ commercializing/ selling “Lait caillé†and “Lait caillé sucré’ in containers with the words†Fresh Dahi†on the labels. Maurilait applied for and obtained an interim injunction prohibiting La Laiterie from doing same. In July 2011, La Laiterie gave an undertaking that it would stop the commercialization and sale of any product which bears the word “Dahi†on its label, pending the determination of a main case. However in November 2011, Maurilait found that La Laiterie was continuing to sell its products using a packaging with the words “Fresh Dahiâ€.
The claim of Maurilait against La Laiterie was on the basis that the distribution/ commercialization and selling by La Laiterie of its commodities/ products with the words “Fresh Dahi’ on its labels were both unlawful and misleading inasmuch as: (a) in view of the goodwill acquired by Maurilait on the word “Dahiâ€, Maurilait was the sole person/ entity entitled to use the said word “Dahi†in respect of “Lait Caillé and/ or curdled milk (b) the Defendant was acting in contravention of the court order restraining La Laiterie from using the words “Dahi†and/or “Super Dahi†on curdled milk sold to the public.
At first instance, the trial Judge found that: (a) Maurilait had failed to establish that it had proprietary rights which were being violated by la Laiterie’s use of the words “Fresh Dahiâ€, (b) it cannot be said that there is any attempt on the part of La Laiterie to deceive customers by passing off its products as being those of Maurilait, (c) there was no evidence of any member of the public being induced to believe that La Laiterie’s product is a product of Maurilait, (d) there was no likelihood of any confusion between the product of Maurilait and that of La Laiterie, the two having a completely dissimilar packaging and visual appearance.
As it appeared that the emphasis had been put on the passing off action under common law, a fundamental question that arose in the course of the present appeal: “Could Maurilait rely on a passing off action which finds its source wholly in English common law in order to obtain the legal remedy sought against La Laiterie?â€
The Court of Appeal held that: (a) it would not be in order to determine the issues in accordance with English common law, (b) the source of the law relating to the issues under consideration are essentially the Civil Code, the Protection Against Unfair Practices Act 2002 and the Patents, Industrial Designs and Trademarks Act 2002, and (c) a complaint for any act or conduct which amounts to a passing off, may be actionable as ‘faute†(“concurrence déloyaleâ€) under Articles 1382 and 1383 of the Civil Code.
It followed that the issue as to whether Maurilait had acquired any proprietary legal right which entitled it to the exclusive use of the word “Dahi†in Mauritius could only be determined in the light of legal principles embodied in the above-mentioned legislations and which are now applicable in Mauritius.
The Appellate Court added that English case law and authorities may be of valuable assistance to interpret the application of the law in relation to any question regarding unfair practices under the Protection Against Unfair Practices Act 2002 and the Patents, Industrial Designs and Trademarks Act 2002 where the language is comparably similar to English law on the subject.
The Court of Appeal concluded that the learned trial Judge wrongly proceeded to decide the case by virtue of the legal principles enunciated under English common law instead of applying the legislation in force in Mauritius such that the judgment given was not well founded in law.
Although invited to proceed with the determination of the case in the light of the principles applicable in respect of an “action en concurrence déloyaleâ€, the Appellate Court decided that it would not be appropriate to do so since such action has several features which are quite distinct from a “ passing off†action under English common Law. However, since the issues which could arise between the parties were not finally determined on the merits, the court non-suited the claim. READ Less >
2.EMTEL LTD V THE INFORMATION AND COMMUNICATION TECHNOLOGIES AUTHORITY AND ORS[2017] SCJ 294
On the 9th August 2017, the Supreme Court of Mauritius handed down a ground-breaking judgment in the case of Emtel Ltd v The Information and Communication Technologies Authority & Ors. For the first time the Information and Communication Technologies Authority (“ICTAâ€) and State Controlled operators were found liable for unfair competition.
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The case was brought by Emtel against ICTA, Mauritius Telecom Ltd (“MTâ€), Cellplus Mobile Communications Ltd (“Cellplusâ€) and the Ministry. Emtel pleaded “faute†under article 1382 of the Civil Code against all four defendants. It was Emtel’s case against the defendants that: (i) ICTA had failed in its duty to ensure that the conditions of the global system for mobile communications licence granted to Cellplus were complied with and to effectively prevent cross subsidisation; (ii) Mauritius Telecom and Cellplus had breached the conditions of the global system for mobile communication licence and engaged in unfair competition thus causing damages to Emtel; (iii) the Ministry had failed to ensure that the directions of the Ministry to ICTA were complied with.
After a thorough analysis of the numerous documents produced and relying on the detailed and elaborated expert evidence given, the Supreme Court held that: (i) there was a responsibility on ICTA to ensure compliance with the licence conditions, (ii) ICTA completely disregarded its responsibility, failed to administer “des prescriptions plus fermes†and showed tolerance of the breach of condition, thereby committing a “faute lourde†(iii) MT and Cellplus breached the condition against cross-subsidisation that they implicitly agreed to comply with and which was stated by ICTA as “conditions to be met†when Cellplus was granted the GSM licence, (iv) both Cellplus and MT have intentionally made use of unfair means leading to a “rupture d’égalité dans les moyens de la concurrence…†and have committed an “act fautif†(v) the “faute†of the Ministry had not been established.
The court then proceeded to assess damages incurred by Emtel, it began by reiterating the fundamental principles to the effect that damages suffered must (i) constitute “un prejudice direct et certainâ€, (ii) be a direct consequence of the “acte fautifâ€, (iii) not be hypothetical and (iv) must be ascertainable.
The court then went on to assess the economic loss claimed by Emtel, it acknowledged that very few Mauritian cases had dealt with economic loss and relied on an article entitled “L’Évaluation des Préjudices Économiques†by Professeur Maurice Nussenbaum. According to Professeur Nussenbaum, economic loss should be assessed by an analysis of the economic situation resulting from a tortious act and that which would have been “but for†the tortious act. Further, where economic loss has been proven but the quantum is uncertain, the defendant should be required to give its assessment “mis à contributionâ€.
The court relied on the calculation of the expert, Mr Nicholas Forrest for the loss of tariff income suffered by Emtel in the counterfactual case for the years 1996-1998, calculation of the revenue which Emtel would have earned had Cellplus not breached the licence conditions and been compelled to charge reasonable tariffs and revenues.
The court then relied on article 1153 of the Civil Code to award interest. Pursuant to article 1153, “where the defendant has on account of his bad faith caused to the claimant a loss distinct and separate from the loss resulting from the delay in settling an amount due, an award in compensatory damages with interest may be madeâ€. The court held that Emtel had proven “un prejudice indépendant de ce retard†as well as “la mauvaise foi†of Cellplus and MT and that compensatory damages with interest pursuant to article 1153 was warranted running from the date of the tortious act.
As a result of the joint “fautes†of the ICTA, Mauritius Telecom and Cellplus Mobile Communication Ltd, the court awarded Emtel damages of Rs 554,139,900. with interests and costs. READ Less >
3. BANQUE POPULAIRE DE LA RÉGION ECONOMIQUE DE STRASBOURG v/s ALAIN TANGUY [2016] SCJ 28 in respect of an application for exequatur.
We appeared for the Respondent. The Court held against the Applicant Bank inasmuch as the consequence of the fusion exercise which took place between Banque Populaire de la Région Économique de Strasbourg, the amalgamating company and Banque Populaire d’Alsace, the amalgamated company, made the Applicant as presently styled, a non-existent entity. It thus set aside the case with costs.
4. FIRST GLOBAL FUNDS LIMITED PCC & ANOR v/s FINANCIAL SERVICES COMMISSION OF MAURITIUS & GOVERNMENT OF THE REPUBLIC OF INDONESIA [2016] SCJ 14 on state immunity, submission to jurisdiction and forum non conveniens.
We appeared in this case for the Government of the Republic of Indonesia (GOI); we raised novel and fundamentally important preliminary objections relating to the doctrine of state immunity. The three main issues for the determination of the Court were:
(a) whether the GOI is immune from the jurisdiction of Mauritius on the basis of the doctrine of state immunity;
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(b) whether GOI has submitted itself to the jurisdiction of Mauritius;
(c) whether the present Court is the appropriate forum for the relief sought by the applicants in view of existing related proceedings in the Courts of the Hong Kong Special Administrative Region of the People’s Republic of China (principle of forum non conveniens). The Supreme Court found in favour of the GOI on all three issues.
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PRIVY COUNCIL CASES OF INTEREST
1. RIVNU INVESTMENT LIMITED AND ANOR V UNITED DOCKS LIMITED AND ANOR[2017] UKPC 24.
Axys Group Ltd (then ACMS holding) was the holding company of ACMS Ltd. On the 30 June 2006, four shareholders of Axys Group Ltd namely Rivnu Investment (RIVNU), Portfolio Investment Management company (PIM), Compagnie Desmem Ltée and United Docks Ltd (UDL) entered into an agreement, by which clause 11, each of them granted to the others an option to purchase all or part of its shares “should there be any change in [its] shareholding structure…, resulting in the loss of the controlling interest of the shareholder(s) which/ who currently hold(s) such controlling interest in the said party.â€
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On 18th July 2006, Horus Ltée acquired 18,27% of shareholding in UDL and on 17th October 2006 a new Board was constituted for UDL (more than half of which members were nominated by Horus).
UDL was called upon by the other three shareholders to transfer its shareholding in Axys Group Ltd to them, pursuant to clause 11 of the said Agreement. UDL refused to do so on the basis that the option conferred by clause 11 had not been triggered.
RIVNU, PIM and CIDL (with which Desmem had by now been amalgated) commenced proceedings.
At first instance the judge dismissed the claim and found for UDL, considering that prior to Horus’s purchase of the shareholding “there was no shareholder having a controlling interest and that as such there “cannot be a shareholder having a controlling interest losing that controlling interest when Horus came into the pictureâ€.
The Court of Civil Appeal dismissed the appeal brought by RIVNU, PIM and CIDL considering that clause 11 was clear, that it would be contrary to the express terms of clause 11.2 and would “dénaturer orâ€modifier†clause 11 to interpret the phrase “loss of controlling interest†as “change of controlâ€.
RIVNU, PIM and CIDL were granted leave to appeal to the Privy Council. The Board dismissed their appeal on the following grounds:
(a) Even if clause 11 of the Agreement indicates that all parties probably thought that each had one or more controlling shareholder(s), that does not mean that each actually did have and there is no basis in its language or otherwise for any suggestion that each represented to the others that such controlling shareholder(s) existed.
(b) There is nothing to show that UDL had any controlling shareholder(s)
(c) On the face of it, clause 11 only applied if there was a change in UDL’s shareholding structure (which must mean in the identity of those holding shares in UDL) which resulted in the loss of their controlling interest by the shareholder(s) currently holding such controlling interest in UDL.
(d) Although terms of a contract must be interpreted to give effect to the common intention of the parties, the Board considered that if a common intention is to shape the meaning which a written contractual clause would otherwise bear, it will have to have been in some way expressed and accepted by both parties, even if only tacitly.
In the present case, the Board saw no basis on which it should be understood as to enable a court to rewrite or adapt the clear wording of clause 11 as if the word “loss†read “change or “acquisition†to cover the present situation. The Board hence dismissed the appeal.
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2. GREWALS (MAURITIUS) LTD v/s KOO SEEN LIN and KOO SEEN LIN v/s GREWALS (MAURITIUS) LTD [2016] UKPC 11 in relation to constructive dismissal.
In a Judgment delivered on the 5th of May 2016, Lord Hughes pronounced as follows:-
(a) When constructive dismissal is in question, the acid test is not whether the employer intended to dismiss; it is whether he has by his conduct, objectively judged, repudiated the contract. If he has, the employee is entitled, by accepting the repudiation, to treat the conduct as constructive dismissal;
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(b) The repudiatory conduct of the employer need not be directly addressed at the employee;
(c) Constructive dismissal is a matter not of fact but of the legal consequences of the facts;
(d) Concerning the apportionment of the car benefit, the value of the car to the employee was not limited to a percentage of its cost, but rather lay in the fact that it was always available to him for private use whenever he wished to use it. That is a legitimate and practical view of the value to an employee of the provision of a company car; and
(e) The Board will not normally entertain an argument, which was not advanced in the Courts below unless it can be done without injustice.
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3. SURINAM SHIPPING v/s DEN DANSKE BANK & MAURITIUS COMMERCIAL BANK [2014] UKPC 10 about documentary credit.
The dispute concerns a letter of credit issued in favour of the Appellant (SURINAM SHIPPING). A dispute arose regarding SURINAM SHIPPING’s non-compliance of its obligations under the letter of credit. SURINAM SHIPPING brought an action against Mauritius Commercial Bank (MCB) for payment of the outstanding remaining sum of US$75,000. READ MORE >
MCB applied to join DEN DANSKE BANK and another bank to indemnify it in respect of the amount that it might be ordered to pay to SURINAM SHIPPING. The main issue was whether, in relation to an irrevocable documentary credit issued in relation to the sale of a Long Liner Shipping Vessel, MCB went beyond its role as an advising bank and assumed the role of a confirming bank such that it was bound to honour the letter of credit. The Judicial Committee held that under UCP 500, the duties of an advising bank are clearly defined and do not include any guarantee to the beneficiary for the payment of sums due under the documentary credit from the issuing or confirming bank. In the present case, the letter of credit and the letter from MCB to SURINAM SHIPPING made it clear that MCB’s role was that of an advising bank. The Appeal to the Privy Council was set aside. READ Less >
4. COPRIM LTÉE v/s MENAGÉ [2008] UKPC 12 on labour law.
On an appeal from the Supreme Court of Mauritius, the Privy Council ruled that the exception “unless good cause is shown†had to be interpreted and applied in such a way as not to undermine the sanction provided in section 39(5) of the Labour Act 1975. READ MORE >
The Privy Council added that the whole system would be rendered ineffective if a failure to notify the Minister did not carry with it, a sanction that was potentially onerous for the employer as the possible outcome of any consideration by the Termination of Contracts Employment Board of its proposed reduction in its workforce. As a result the Appellant was obliged to notify the Minister of Labour, Industrial Relations and Employment of its intention to reduce its work force together with a statement of the reasons for the reduction and its failure to do so rendered the Appellant, liable to the punitive sanction as there was nothing in the circumstances advanced by it which would constitute good cause for holding that the company should not be so held liable. READ Less >
5. TYACK v/s THE STATE [2006] UKPC 18 on sentencing principle.
The Appellant was charged on two counts of conspiracy to defraud, an offence that carried a maximum penalty of five years' penal servitude. The charges related to two specific transactions. The Appellant pleaded guilty to those charges. He was sentenced to three years' penal servitude under each count. READ MORE >
He appealed to the Supreme Court of Mauritius on the grounds, inter alia, that the trial magistrate had erred in taking into consideration extraneous and irrelevant matters, which went beyond the charges preferred. The Supreme Court dismissed the appeal, and considered the whole period of the conspiracy without limiting itself to the isolated offences constitutive of the two charges. On appeal to the Privy Council, it was decided that the Intermediate and Supreme Courts had erred in considering the whole period and total amount of the fraudulent transaction and that they ought to have limited themselves to the charges to which the Appellant had pleaded guilty. Their Lordships reviewed the discounting factors to be considered for sentencing. The appeal was allowed by their Lordships of the Judicial Committee and the sentence was reduced. READ Less >
6. MON TRESOR AND MON DESERT LTD (ILLOVO) v/s MINISTRY OF HOUSING AND LANDS AND BOARD OF ASSESSMENT [2008] UKPC 31 about compulsory acquisition.
The land in lite consisted of a plot of land, zoned for agricultural purposes and owned by the Appellant. It was subject to compulsory purchase by the first Respondent for the purpose of building a Hospital. The second Respondent, whose duty was to evaluate the land, READ MORE >
took the view that the direct comparison method could not be used in the instant case, as none of the comparable produced by the parties had sufficiently similar characteristics to the land in issue, and resorted to a residual method of valuation based on a hypothetical development for ultimate sale to purchasers. Dissatisfied with the second Respondent’s valuation, the Appellant appealed to the Supreme Court. The value of an interest in land compulsorily acquired was the amount which that interest, if sold on the open market by a willing seller, might be expected to realise at the date of first publication of the statutory notice of purchase. In assessing the value, the best evidence was comparison with figures from other sales of comparable property. The land acquired had to be valued not merely by reference to the use to which it was being put at the time, at which its value had to be determined, but also by reference to the uses to which it was reasonably capable of being put in the future. Where there were no comparable sales, resort could have been the residual value method, however that should be reserved for exceptional cases and would not be applied where the open market value was otherwise ascertainable. In circumstances where a spot valuation, based upon comparison plus an element of hope value, could give a realistic figure for the amount that a speculative developer might be willing to pay for the land, it would be wrong to adopt the residual value method. In the instant case, the comparables relied on by the Chief Government Valuer gave an acceptable basis for assessing the value of the land, with an appropriate adjustment for a modest amount of hope value. Accordingly, the Judicial Committee of the Privy Council decided that the Supreme Court of Mauritius had been right to reverse the decision of the second Respondent and was justified in its adoption of its method of calculating the value of the land. READ Less >
7. HURNAM v/s PARATHIAN [1998] AC 707, [1998] 2 WLR 790 in respect of a litigant in person.
The Appellant, a barrister, sought leave to conduct his own defence in defamation proceedings. The judge, on granting leave, exercised his discretion to impose such conditions as he thought fit, and ruled that the Appellant would not be permitted to make an opening speech or put forward an argument in law, READ MORE >
or to make submissions in law and on facts. When the Appellant made an application to address the court, the judge took the view that a litigant in person had no such right and refused the application. The Appellant’s appeal to the Civil Court of Appeal, on the ground that his right to a fair hearing under the Constitution had been infringed, was unsuccessful. This decision was challenged before the Judicial Committee of the Privy Council where it was held that:
(a) The trial judge should have exercised his discretion to ensure that each party received a fair hearing pursuant to the Constitution;
(b) If one party had the opportunity to address the court on law and facts and the other did not, then the trial could not be fair, irrespective of whether one of the parties was a litigant in person;
(c) Consequently, the judge’s initial ruling to prevent the Appellant from addressing the court was unjustified;
(d) The judge might have had a legitimate concern that the Appellant would abuse his right to address the court but, given that he had conducted his case properly, the judge ought to have reconsidered the matter before making his second ruling. Thus, the Appellant had been denied a fair hearing guaranteed by the Constitution and the appeal was allowed.
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