Senior Reporter
The Court of Appeal will have to decide whether a law firm or a Bahamas-based subsidiary of CL Financial (CLF) should have exclusive access to legal costs that the estate of former CLF executive chairman Lawrence Duprey was awarded for a discontinued lawsuit against him (Duprey) and other former CLF executives, over their alleged roles in the conglomerate’s collapse.
Guardian Media understands that British American Insurance Company Ltd (BAICO) filed an appeal after High Court Judge Vigel Paul ruled that Chersons, which initially represented Duprey in the now-discontinued proceedings, was entitled to receive its fees from the legal costs to be paid by the Central Bank of T&T (CBTT) and CLF subsidiary Clico, with BAICO having access to what remains.
In the appeal, BAICO is claiming that Justice Paul was wrong to find the existence of a solicitor’s equitable lien in relation to Chersons and to grant it (Cherson) equitable relief.
The Court of Appeal is yet to set a date for the hearing of the procedural appeal, which is expected to be heard later this year.
BAICO’s substantive case seeking to freeze assets linked to Duprey to recoup US$122 million in court-ordered damages came up for hearing before Justice Paul yesterday morning and it (the case) was adjourned to October 1.
The significant damages sought by BAICO related to legal proceedings in the United States (US) over Duprey’s breach of fiduciary duty in the company’s investment in the Green Island real estate development in Osceola County, Florida.
BAICO invested US$295 million in the project, which resulted in over US$100 million in losses.
The losses forced the company into insolvency and led to subsequent multinational insolvency proceedings.
BAICO first filed its US lawsuit against Duprey and its other executives in September 2009.
While the executives came to out-of-court settlements with the company, Duprey, a former director, and former chairman Brian Branker continued to challenge the claim.
Duprey, Branker and their attorneys were active in the case initially as they opposed several aspects of BAICO’s claim.
After Duprey and his legal team were absent from the proceedings periodically between 2013 and 2015, the company obtained a default judgment against the duo.
Duprey then challenged the default judgment, as he claimed his attorney had withdrawn from the case and he was not aware of its status. However, he failed to overturn the default judgment.
In 2018, BAICO, through its attorneys Bryan McCutcheon, Andre Rudder, and Candace Layers, of J D Sellier and Company, registered the judgment debt locally so that it could begin the process of seeking to recoup the debt from Duprey’s assets.
In 2011, CBTT and Clico filed its case seeking to hold Duprey, former CLF executive Andre Monteil, their private companies, former CLF corporate secretary Gita Sakal liable for decisions which allegedly led to the collapse of the company and a multi-billion dollar government bail-out and takeover in 2009.
They were accused of mismanaging the company by misapplying and misappropriating the company’s income and assets to the detriment of policyholders and investors.
The case sought damages and restitution for the losses suffered by the company during the group’s tenure.
Duprey passed away in 2024. The case only went on trial in January this year, but was stopped while the proceedings were ongoing.
The case was eventually withdrawn after Attorney General John Jeremie announced plans to end civil litigation related to the conglomerate and its subsidiaries.
BAICO then applied for access to the reasonable costs awarded to Duprey’s estate for the failed case to partially satisfy its debt. Chersons intervened as it claimed that it had an equitable lien on all or part of the funds.
In determining which party was entitled to the funds, Justice Paul noted that the exact figure awarded was only revealed to him and not the litigants based on a request from CBTT and Clico.
He upheld Chersons’ claim as he ruled that the funds were not the beneficial property of Duprey’s estate and BAICO could only access what remains.
While he acknowledged the plight of over 3,500 BAICO policyholders seeking to recoup their investments by recovering the debt from Duprey’s estate, he noted that he could not ignore the firm’s valid claim.
“Equity must, however, be administered according to principle, not according to the relative sympathies of the parties,” Justice Paul said.
“To deny the lien on the basis that other creditors deserve the money more would be to undermine the very principle of access to justice that the lien exists to vindicate,” he added.
He stated that the law had to afford protection to lawyers who act on credit for “impecunious” clients.
“To erode that assurance would be to make access to justice harder, not easier, for the very people whom the doctrine is designed to assist,” Justice Paul said.
Chersons was represented by Russell Huggins, Cherisse Huggins, and Rynelle Ruben. CBTT and Clico were represented by Ian Benjamin, SC, and Elena Araujo.
