Law Lords award $30M to Dipcon

THE Judicial Committee of the Privy Council yesterday awarded close to $30 million in damages, interests and costs to Trinidad company, Dipcon Engineering Services Ltd, in a suit brought against the Grenada government. The Privy Council, comprising Lords Nicholls, Hoffmann, Hope, Brown and Baroness Hale, reversed a decision of the Grenada Court of Appeal and ruled that Dipcon was entitled to damages and costs. Dipcon is to receive EC $11,202,632 (TT $24 million) along with interest dating back to 1996, along with costs incurred in the Grenada Courts to the Privy Council.

Dipcon had obtained a judgment from the Grenada HIgh Court on December 9, 1996 against the Grenada Government for EC$11,202,632 plus interest, but the Grenada Court of Appeal comprising Sir Dennis Byron, Justice Singh and Justice Redhead, reversed the decision on January 14, 2002. By a written agreement dated September 30, 1994, the Grenada Government leased to Dipcon a quarry at Mount Hartman, St George and provided for it to be worked for an initial period of 10 years on terms as to the supply of aggregate and other materials to the Government and the payment of royalties by Dipcon.

The Government terminated the agreement on November 1, 1995 and on January 8, 1996, forcibly dispossessed Dipcon from the quarry. Writs were issued by Dipcon in January and July 1996 in which the Trinidad company sought EC $19 million. On December 9, 1996, no defence having been delivered, judgment was entered for Dipcon against the Government for damages to be assessed. Following the default judgment, Dipcon and the Government entered into lengthy negotiations as to the damages payable, leading to a consent order on December 11, 1998 for payment of EC $3 million. However, Dipcon claimed not to have authorised this settlement and the consent order was set aside. Dipcon took steps to have damages assessed in the High Court, but the Government resisted.

Justice Alleyne heard submissions and on July 31, 2001, awarded damages to Dipcon in the sum of EC $11.2 million plus interest and costs. The Government appealed and on January 14, 2002, the Court of Appeal agreed with the Government and set aside the default judgment. Dipcon appealed to the Privy Council and contended, among other things, that it was not open to the Court of Appeal to set aside the default judgment against the assessment of damages. But the Trinidadian company failed on this ground. Dipcon also contended that the Court of Appeal was wrong to find that the trial judge had misdirected himself as to the proper test to apply on a setting aside application. The Law Lords agreed with this submission.

Lord Brown, who delivered the judgment, asked, “could it really be right, five years after a regular judgment was entered following the Government’s unexplained breach of a peremptory order, to deprive Dipcon of its benefit and at that stage require them to litigate a claim which for four and half years they had no reason to suppose would be contested?” He continued, “It seems unlikely that it could, and certainly to have done so would have required a process of reasoning beyond that to be found in the Court of Appeal’s judgment.”