IN THE HIGH COURT OF JUSTICE DWAINE PATRICK RAWLINS AND

Transcription

1 BRITISH VIRGIN ISLANDS Claim No. BVIHMT2001/0041 BETWEEN: IN THE HIGH COURT OF JUSTICE DWAINE PATRICK RAWLINS AND Petitioner/Respondent BERNADETTE DIANE RAWLINS Respondent/Applicant Appearances: Mrs. Tana ania Small-Davis for the Petitioner/Respondent Ms. Melanie Williams for the Respondent/Applicant : September 28, 29 October 22 December January JUDGMENT [1] RAWLINS, J.: The Parties were married on 2 nd August There are 2 children of the marriage. They were born in 1988 and 1992, respectively. In August 2001, Mr. Rawlins brought a Petition seeking to dissolve the marriage. He also prayed for an Order granting him joint custody of the children. The decree nisi was pronounced on 19 th October On 28 th January 2004, Mr. Rawlins applied to proceed with the prayer in his Petition relating to the care and custody of the children. In that Application, he stated that the Parties had agreed to certain arrangements for their welfare.

2 [2] However, on 30 th April 2004, Mrs. Rawlins applied for Ancillary Relief. In that Application, she gave notice of her intention to apply for various Orders pursuant to Rule 51 of the Matrimonial Proceedings Rules These include Orders relating to the arrangements for the welfare of the children. They also include Orders that pronounce on her entitlement to funds held in various accounts in their joint names, as well as an Order that Mr. Rawlins should transfer to her his interest in property that is located at Church Ground, Nevis. They were registered owners as tenants-in-common. Order of September 2004 [3] On 24 th September 2004, I ordered that both Parties should have joint custody of the children. The Order provides that the children are to reside with Mrs. Rawlins. Mr. Rawlins was given reasonable access in terms that were to be provided subsequently. Inadvertently, these terms were not provided or canvassed at the hearing. The Parties have agreed that Mr. Rawlins shall have custody of both children from 9:00 o clock Saturday mornings until 5:00 o clock on Sunday afternoons, unless he otherwise notifies her at least 2 days prior to the time for access. Mrs. Rawlins shall give at least 7 days notice to Mr. Rawlins if she wishes to vary his weekend access to the children and obtain his consent to the variation. The Parties have decided that they will come to an agreement between themselves that will permit the children to spend alternate holidays with either of them. The Parties have liberty to apply in relation to the access provisions. [4] Mr. Rawlins is to pay $ per month for the maintenance of each child of the marriage. Inadvertently, no provision was made for the time at which maintenance payment should terminate. For consistency with other provisions of the Order, I now direct that Mr. Rawlins shall make maintenance payments until each child attains the age of 18 years or sooner is gainfully employed or married. [5] The Order of 24 th September 2004 directed Mr. Rawlins to pay $ per month as a contribution towards Mrs. Rawlins house rent. This contribution is to be made for such time as either child resides with her until their completion of tertiary education, or each 2

3 sooner obtains gainful employment or marries. Mr. Rawlins was ordered to pay one-half of the educational expenses of each child over and above the scholarships or other financial awards that they now have or may obtain. He is to pay this until the children complete tertiary education, or sooner obtain gainful employment or marry. Mr. Rawlins will also pay one-half of the medical expenses of each child in the same terms. [6] In relation to property, Mr. Rawlins would have full ownership of the property that is located at Church Ground, Nevis. However, he was directed to transfer full title in 2 parcels of land situate at Prospect and Braziers Estate, Nevis, free of incumbrances, to Mrs. Rawlins. The largest parcel is about 1 acre in size. Both parcels were registered in the joint names of the Parties. Remaining issues [7] The issues that now remain for consideration relate to Mrs. Rawlins entitlement to funds that are or were held in bank accounts that were in the joint names of both Parties. Mrs. Rawlins claims an equal share of the funds in the accounts as at the time of their separation in She admits that Mr. Rawlins wholly funded the relevant accounts, except one. She does not claim entitlement on the ground of direct contribution. Rather, she claims on the ground of indirect contribution to household expenses. She alleges that Mr. Rawlins deprived her of her interest in the accounts because he removed the monies from them and closed them without her prior knowledge or consent after they separated. She referred to 2 certificates of deposit (CDs) that Mr. Rawlins held in trust for the benefit of the children. She insisted that the Parties treated the monies in the other relevant accounts as a joint pool of funds for the benefit of the family. The Relevant Bank Accounts [8] The Parties had a number of accounts in their joint names at various banks in this Territory. They also had accounts in Nevis. At the hearing, Mrs. Rawlins indicated that 3

4 she is interested in the CD accounts that were held in banks in this Territory in trust for the children, as well as certain accounts in Nevis. The accounts held on trust [9] In her Affidavit of Means, Mrs. Rawlins stated that the Parties had a CD at ScotiaBank (BVI), which contained about $22, at the time when they separated. She claimed an equal share of the funds and asked that Mr. Rawlins should be ordered to account for the monies because he closed the account. [10] In response, Mr. Rawlins deposed that the funds that were held in this account were saved towards the children s tertiary education. He stated, in his Second Affidavit, that he transferred the funds to other CD accounts that he holds in trust for the children. He exhibited copies of 2 CD confirmation certificates to his Fourth Affidavit. These indicate that these accounts, which are held at ScotiaBank (BVI), are numbered and , respectively. An amount of $10, was deposited in each account. The issue date was 20 th August The maturity date was 20 th September However, they are, in effect, month-to-month rollover accounts that are opened for a term of 30 days. The maturity instructions provide for the renewal of the principal and the maturity interest. The confirmation certificate indicates that Mr. Rawlins holds these CDs in trust for each child of the marriage. [11] Additionally, Mr. Rawlins disclosed in his Fifth Affidavit that he holds account No at FirstBank (BVI) in trust for his daughter Renee. He said that he opened it from his own account. [12] At the hearing, Mrs. Rawlins said that she no longer claimed any interest in the CD accounts for herself. Rather, she requested that the CD accounts should remain intact for the children. I agree. 4

5 [13] I expressed concern when Mr. Rawlins revealed in his oral evidence that he was able to withdraw interest from the CD accounts. It is trite principle that a trustee should not interfere with trust funds except to promote the interest of the beneficiaries for whom he holds. He cannot seek to benefit from such funds, and cannot do so, except with the consent of the beneficiaries. These trust accounts are held for minor children. They cannot consent. It is incumbent upon the banks and upon Mr. Rawlins that they deal with these accounts as trust accounts. [14] Since the funds were intended for the tertiary education of children, it might have been helpful to have that stated in the words that created the trust. In any event, on the trust that is expressed on each CD, each child would be entitled to have the proceeds or the legal capacity to give instructions thereon at the age of majority. [15] In the meantime, I shall direct ScotiaBank (BVI) and Mr. Rawlins to do all things that are necessary to ensure the integrity of the funds in the 2 CDs that Mr. Rawlins holds on trust for the children in CD accounts numbered and I shall also direct FirstBank (BVI) and Mr. Rawlins to do all things that are necessary to ensure the integrity of the funds in CD account No at FirstBank (BVI) in trust for his daughter Renee. ScotiaBank (BVI) and FirstBank (BVI) shall inform Mrs. Rawlins, immediately of the present balance in these accounts. In the future, they shall also inform Mrs. Rawlins of any proposed dealing with the accounts, before hand. They must obtain her consent before any dealings with them until each child attains the age of 18 years. Neither Mr. Rawlins nor anyone else will be permitted to interfere with or take any of the monies in the accounts other than in accordance with these directions. The Other subject accounts [16] Mrs. Rawlins states, in her Second Affidavit, that the Parties maintained 8 accounts in their joint names in Nevis. In her oral evidence, she said that they held 2 accounts, a saving account and a checking account, at ScotiaBank Nevis. They also held a US$ account at the said bank that she opened with US$1, She further stated that they held a 5

6 savings account at the Co-operative Credit Union. They held 2 accounts a US$ and an EC$ savings account at the Bank of Nevis. They also held 2 accounts a checking and a savings account at RBTT Bank. [17] In her Affidavit of Means, Mrs. Rawlins stated, additionally, that the Parties maintained a CD account at FirstBank (BVI), which contained about $10, at the time of their separation in She exhibited an interest payment notice for the period 21 st August 1999 to 21 st September The account number was The balance on the account was $10, at the maturity date, 21 st September The names on that account were stated as follows: Dwaine Rawlins &/or Bernadette Rawlins. Mr. Rawlins stated that he withdrew this sum from the account to repay a car loan when he was not gainfully employed. Pussers terminated his employment on 31 st July He recently found employment in Nevis. [18] Mrs. Rawlins said that except for the US$ account at ScotiaBank, Nevis, Mr. Rawlins provided all of the funds for these accounts. According to her evidence, he only had those monies to put into savings because she provided food, paid utilities and rent, and contributed generally to the upkeep of the home. This is a bald assertion. She provided no particulars or evidence to support it. She said that he closed the accounts in 2001 and has refused to account to her for the funds, notwithstanding her many requests. [19] On the other hand, Mr. Rawlins deposed that he held only 2 accounts in Nevis, which were opened a long time ago. His evidence is that their balances are $2, and $5,500.00, respectively. The monies that were sent to these accounts were intended for and were used to maintain his house in Nevis. He put Mrs. Rawlins name on the accounts to facilitate this on his instructions when she traveled to Nevis. [20] In his fifth Affidavit, however, Mr. Rawlins provided particulars of the 2 accounts that he said were held in their joint names at the RBTT Bank in Nevis. He said that these were in addition to the Credit Union Account. They were savings account No and checking account No According to Mr. Rawlins, they contained balances of EC$

7 and nil, respectively. In his oral evidence he said that these 2 accounts were opened in 1981 or This was before their marriage. [21] The Credit Union Account, No , shows that Mrs. Rawlins name was deleted from it on 15 th May The document that was provided does not show the date when it was opened. The first balance that it shows was at 28 th June It was EC$5, The last balance that it shows was at 24 th July It was $5, [22] In his oral evidence, Mr. Rawlins said that the Parties held 2 joint accounts at ScotiaBank, Nevis, but Mrs. Rawlins closed both. Mrs. Rawlins did not deny this in her evidence. Mr. Rawlins did not recall having a joint US$ account No at ScotiaBank Nevis. No evidence was brought by Mrs. Rawlins to prove that the Parties held such a joint account. Mr. Rawlins admitted that they held a joint savings account at the Bank of Nevis, and that he closed it. He noted Mrs. Rawlins statement that the closing balance was EC$14, He insisted that the monies on that account were funds from a loan that he took to effect repairs to his house. [23] It has been quite difficult to determine definitively what accounts did in fact exist when the Parties separated. Neither Party assisted the process as well as they might have with documentary evidence. It appears that their Solicitors experienced some difficulties accessing information from the financial institutions. Apparently, the institutions do not keep records that can be easily accessed after a certain period. This is unfortunate. However, Ms. Williams estimated that Mrs. Rawlins entitlement at the time of their separation was between $30, $40, Before considering what evidence there is to support this assertion, I shall consider the applicable legal principles that govern entitlement. The applicable principles [24] Ms. Williams submitted that the applicable principle is that a presumption of advancement or gift arises where, during the course of a marriage, one spouse is the sole financier of a 7

8 bank account that is held in the joint names of the spouses. The one is presumed to have made a gift of one half of the funds in the account to the other spouse. This presumption arises where the account is intended for the benefit of the family as a whole, and there is no restriction as to the purpose of the account. [25] Ms. Williams further submitted that the presumption is not rebutted solely because one spouse was the only or main provider of the funds. She said that where the presumption arises, one spouse is not entitled to assume full ownership of the funds held in the account without the consent of the other, unless that spouse first obtains an Order of the Court. She cited as authorities Dunbar v Dunbar [1909] 2 Ch. 639; Jones v Maynard [1951] 1 ALL E.R. 802; Re Bishop (deceased). National Provincial Bank Ltd. [1965] 1 ALL E.R. 249 and Franklyn Daley v Harriet Daley, Privy Council Appeal No. 45 of [26] I do not think that Jones v Maynard is helpful. Its principles govern cases in which both spouses put savings into a joint pool and used them for personal and family expenses. The husband invested from it. When the spouses separated, he entreated the Court to divide the proceeds proportionately to their respective contributions to the pool. It was obvious that he had contributed significantly more to the pool than the wife did. It was held that when spouses pool their resources in such a common purse, they cannot thereafter ask the Court to dissect the funds in this manner because the rules of equality apply. Re Bishop (deceased) confirms this. [27] Re Bishop (deceased) goes further, however. Its true principle is that where spouses open a joint account on which either may draw, each spouse may draw for his or her own benefit, unless the account was intended for some other specific purpose. Any property that either spouse purchases with the funds that he or she draws from the pool for individual benefit is not joint, but individual property. [28] The Franklyn Daley case involved, inter alia, the question of a wife s entitlement to an equal share in the proceeds that the husband removed from a joint CD account. He closed the account. The Parties accepted that he withdrew $70, from it. The 8

9 question in our case, whether the wife was an equal beneficiary in the CD account, was not a live issue in the Franklyn Daley case. It was accepted that she was an equal beneficiary. The question in Franklyn Daley was whether the wife had already withdrawn or misappropriated her equal share from a larger sum through the business that they operated. To this extent the Privy Council upheld the finding of the trial judge who had found that Mrs. Daley had not acted improperly or dishonesty. She was therefore entitled to receive her equal share of the $70, that Mr. Daley took from the account when he closed it. [29] Mrs. Small-Davis submitted that Mrs. Rawlins would only be entitled to an equal share of the monies that Mr. Rawlins withdrew from the relevant joint accounts if the Court finds that there was a common intention that Mr. Rawlins conferred such an interest on her. She cited as authority the Privy Council decision in Helga Stockert v Margie Geddes (Executrix of the estate of Paul Geddes), Privy Council Appeal N. 56 of [30] The Geddes case was concerned, inter alia, with a claim by an unmarried woman for an equal share of the monies that Mr. Geddes, deceased, held in accounts in Europe in their joint names. The trial judge and the judges of the Court of Appeal of Jamaica found that she would have been entitled if the facts showed that there was a common intention that she should have had that interest. It was accepted that she would not have been entitled if her name was placed on the accounts only as a signatory to facilitate her ability to conveniently access the accounts, particularly when she was in Europe. [31] In my view, however, the notion of common intention in the Geddes case was not intended to replace the presumption of advancement in a wife s favour, where, as in our present case, a husband joins her on his accounts. The presumption is rebuttable by evidence that the husband did not intend to advance an equal share to the wife. The burden is upon the husband. The question, therefore, is whether Mr. Rawlins rebutted the presumption. This requires a consideration of the evidence in this case. 9

10 The evidence [32] Mrs. Rawlins insisted that the monies in these accounts were to be used for the benefit of the family, generally, and to fund the tertiary education of the children. Mr. Rawlins denies this. He insisted that they had no discussions about the accounts being used for the benefit of the family, but he chose to use some of the monies for that purpose. [33] In his fourth Affidavit, Mr. Rawlins deposed that he placed Mrs. Rawlins name on the accounts because she was his wife. He wanted her to be able to access them in the event that anything happened to him. He removed her name from them because she physically abused him. They separated after she poured an acidic solvent over his right arm. He sustained severe burns and scars to the entire arm. He was hospitalized and had to undergo 2 surgical procedures for which he incurred expenses upwards of $4, There is still extensive scarring. He also removed her name from the accounts because she withdrew funds from them, even after they separated, without his knowledge. [34] In cross-examination, Mr. Rawlins admitted that he never told Mrs. Rawlins that she did not have any interest in the accounts. He said that he placed her name on the accounts not to confer a beneficial interest on her but for convenience. He admitted that he gave her monies from the accounts from time to time. His evidence is that he purchased a motor vehicle for her, took her on vacation and cruises, and maintained an account for her at Banco Popular. In re-examination, he said that they held this account jointly. He deposited money in it every month. He left that account to her because he intended it to be for her benefit. [35] I believe the evidence that Mr. Rawlins gave that he placed Mrs. Rawlins name on the accounts for convenience. Thereby she would have been able to access them if anything happened to him. He could transact from them without her consent, approval or signature. Apparently she was able to do the same. She has not denied that she withdrew monies or closed joint accounts after they separated. However, her evidence indicates that she has very little knowledge of the particulars of the accounts. It is obvious that Mr. Rawlins had 10

11 almost exclusive control of them. According to Mrs. Rawlins, letters relating to the accounts were sent to a post box for which Mr. Rawlins had the key. He was the sole financier of the accounts. [36] I believe Mr. Rawlins evidence that he expended from the accounts for the family s home needs and vacations. He purchased a motor vehicle for Mrs. Rawlins. She benefited from those savings in other ways. Even after they separated she withdrew funds from them. Mr. Rawlins did the same to repay his car loan when he was unemployed. Prior to that he paid for the surgical procedure that became necessary when Mrs. Rawlins poured an acidic substance over his arm. [37] They had the joint account at Banco Popular. I believe that Mr. Rawlins contributed substantially to that account, notwithstanding that Mrs. Rawlins said he did not. He left that account to her because he saw it as hers. He has not claimed a half share in it. He holds CDs on trust for the children. [38] When the Parties were married in 1986, Mr. Rawlins was a night manager at the Sugar Mill Hotel, while Mrs. Rawlins was a Sales Clerk. According to Ms. Williams, Mrs. Rawlins assisted with the household expenses and managed the family s finances to permit them to have the joint savings accounts. They treated their assets, including the accounts as common property. However, Mrs. Rawlins did not provide this evidence. Mrs. Rawlins employment record and earnings over the years do not indicate that she could have contributed much financially to the home. [39] During the hearing, there were indications that Mrs. Rawlins has at least one other account in her sole name, but she provided no particulars of the account. Mrs. Williams said that Mrs. Rawlins contributed to the welfare of the family by being the primary care giver. I have no doubt that Mrs. Rawlins has seen to the welfare of the children. There is evidence that Mr. Rawlins also did so. The children are now both recipients of scholarships. 11

12 [40] I think that the evidence that Mr. Rawlins gave is sufficient to rebut the presumption of advancement or gift of an equal share in the accounts to Mrs. Rawlins. He opened, maintained and operated the accounts as his own. In the foregoing premises, I dismiss Mrs. Rawlins Application for an Order that pronounces her entitlement to an equal share in the accounts. Costs [41] Mrs. Small-Davis submitted that if the Court finds that Mrs. Rawlins is not entitled to an equal share in the funds in the accounts, it should order her to pay Mr. Rawlins costs in these proceedings. Her bases for this submission are, first, that Mr. Rawlins would have prevailed in these proceedings, and, second, because the outcome would basically be in the same terms as an offer to settle that was made by Mr. Rawlins prior to hearing. [42] Part 64.6(1) of the Eastern Caribbean Supreme Court Civil Procedure Rules 2000 provides that where the Court decides to make an Order for costs in any proceedings, the general rule is that costs follows the event. Costs will not follow the event, however, if there are good reasons that it should not. Part 65.5(4) confers a discretion upon the Court to award only a proportionate part of prescribed costs having taken into account Parts 64.6(4) and (5) of the Rules. Under Part 64.6(3)(a) & (b), the Court may order a party to pay costs from or up to a certain date only, or the costs that relates to a distinct part of the proceedings. In my view, the circumstances for these orders did not arise in this case. However, Part 64.6(2) gives the Court the discretion to order a successful Party to pay all or part of the costs or make no order as to costs. Parts 64.6(5) and (6) provide guidance to the Court on the exercise of its discretion. In the first place, the Court must have regard to all of the circumstances. In particular, it must consider the conduct of the Parties both before and during the proceedings. [43] Part 35 of the Rules deals with offers to settle cases and the consequences of such offers. Part 35.4 states that an offer to settle may be made under Part 35 at any time before the commencement of the trial of a case. Part 35.5 of the Rules deals with the procedure by 12

13 which an offer to settle is to be made. Under this Rule, the offer must be in writing. The offeror must serve it on the offeree. The Court should not be informed that an offer was made, or that payment was made into court in support of the offer before the Court determines the case. [44] Part deals with the procedure for acceptance of offers. Part deals with the effect of acceptance. Part deals with the manner in which costs is to be awarded where a pre-trial offer was not accepted. Part 35.3 of the Rules provides for the manner in which offers to settle are to be made. Under this Rule, a Party may make a without prejudice settlement offer to another Party and reserve the right to disclose the terms of the offer to the Court after judgment is given for the purposes of allocating costs. [45] In the present case, the conduct of Mrs. Rawlins in the initial stage of this matter brought me close to striking out her Application. She did not appear and Mr. Rawlins did. Her cooperation at that stage would have caused less inconvenience to Mr. Rawlins and this case could have been concluded sometime ago. Outside of this, I think that she is entitled to costs. The procedure that is required under Part 35 was not followed. Even if it were, it is my view that Mrs. Rawlins correctly pursued the issues that she brought on her Application. Ms. Williams assisted the Court, as Mrs. Small-Davis did, to achieve the settlement of the issues in the Order of 24 th September She was not unwise or unreasonable to pursue the claim for entitlement to an equal share of the funds in the accounts. Although she did not prevail on this, the Court will make an Order to preserve the trust funds. In the circumstances, Mr. Rawlins shall pay 75% of her costs. I assess this to be $3, taking into consideration the pleadings and the litigation time. Summary of the Order [46] The Order and directions therein are premised on the foregoing, and is hereby summarized in the following terms: (1) The Application that the Respondent/Applicant made for an equal share in the funds that were held in their joint names is dismissed. 13

14 (2) The terms of access to the children of the marriage that Mr. Rawlins was granted in the Order of 24 th September 2004 shall be settled on 31 st January (3) By consent, Mr. Rawlins shall have custody of both children from 9:00 o clock Saturday mornings until 5:00 o clock on Sunday afternoons, unless he otherwise notifies her at least 2 days prior to the time for access. (4) Mrs. Rawlins shall give at least 7 days notice to Mr. Rawlins if she wishes to vary his weekend access to the children and obtain his consent to the variation. (5) The Parties shall agree on the arrangement by which the children shall spend alternate holidays with either of the Parties. (6) The Parties have liberty to apply in relation to the access provisions. (7) The direction that was made in the said Order of 24 th September 2004, that Mr. Rawlins shall pay to Mrs. Rawlins $ for the maintenance of each child of the marriage, is amended by adding at the end of the direction the words until each child attains the age of 18 years or sooner is gainfully employed or married. (8) ScotiaBank (BVI) and Mr. Rawlins shall do all things that are necessary to ensure the integrity of the funds in the 2 CDs that Mr. Rawlins holds on trust for the children in CD accounts numbered and (9) FirstBank (BVI) and Mr. Rawlins shall do all things that are necessary to ensure the integrity of the funds in CD account No at FirstBank (BVI) in trust for his daughter Renee. (10) ScotiaBank (BVI) and FirstBank (BVI) shall inform Mrs. Rawlins, immediately of the present balance in these accounts. (11) In the future, ScotiaBank (BVI) and FirstBank (BVI) shall also inform Mrs. Rawlins of any proposed dealing with the accounts, before hand, and obtain her consent before any dealings with them until each child attains the age of 18 years. (12) Neither Mr. Rawlins nor anyone else shall interfere with or take any of the monies in the accounts other than in accordance with these directions. 14

15 (13) Costs on the Application assessed at $4,000.00, of which Mr. Rawlins shall pay Mrs. Rawlins 75% or $3, Hugh A. Rawlins High Court Judge 15