We are often advised against leaving things to the last minute (and for good reason). However, for those working in the financial services industry, sometimes the “last minute” simply cannot be avoided. Often the “last minute” is also the first minute a task can be completed. Regardless of time available, we of course also need to get the job done right.
The themes of getting things done in the last minute and getting things done the right way feature throughout the below discussion of recent jurisprudence from the Cayman Islands Grand Court and an update from the Cayman Islands Monetary Authority in relation to anti-money laundering regulations.
As we move closer to the end of 2018 and towards end of year deadlines, at least we can take comfort that holiday season (and a chance to reflect on our accomplishments over the year) is not far away.
Settling litigation on the courthouse steps
“Settling on the courthouse steps” is a common expression which usually elicits images of slightly disheveled (and perhaps sleep-deprived) lawyers signing documents on the back of a briefcase early in the morning before being summoned to appear before a judge.
While it is true that many settlements happen immediately before a court hearing takes place, the phrase “settling on the courthouse steps” could equally apply to parties settling not on their way in but on their way out of court. In complex matters, judges will often reserve their decisions for weeks or months. This may give parties further time to settle disputes after the hearing, but before judgment is given. There are good reasons that many disputes are only resolved at the last minute. Understandably, it is sometimes only after each party has had an opportunity to review and consider each other’s evidence and arguments (and perhaps witness the judge’s approach to the dispute) that the parties have enough information to reach settlement.
On two recent occasions, the court has been asked to consider whether it should release judgments in circumstances where the parties had reached settlement after trial:
- In the Aug. 30, 2018, unreported judgment of Justice Ingrid Mangatal in Toby v Allianz Global Risks US Insurance Company Cause no. FSD 152 of 2013, the parties announced to the court that they were at an advanced stage of settlement only after a 200-page draft judgment had been circulated to the parties (and after over four years of litigation). The parties then asked the court not to publish the judgment.
- In the Sept. 13, 2018, unreported judgment of Justice Robin McMillan in In re Torchlight Fund L.P. Cause no. FSD 103 of 2014, the court was asked to consider whether it could deliver judgment notwithstanding that the parties reached settlement after the hearing had been completed, but before the parties had received a copy of the judgment.
Both Justice McMillan and Justice Mangatal took into account the comments of Lord Neuberger MR in Barclays Bank v Nylon Capital LLP  All ER (Comm) 912 at paragraph 74: “Where a case has been fully argued, whether at first instance or on appeal, and then it settles or is withdrawn or is in some other way disposed of, the court retains the right to decide whether or not to proceed to give judgment. Where the case raises a point which it is in the public interest to ventilate in a judgment, that would be a powerful reason for proceeding to give judgment despite the matter having been disposed of between the parties. Obvious examples of such cases are where the case raises a point of potential general interest, where an appellate court is differing from the court below, where some wrongdoing or other activity should be exposed, or where the case has attracted some other legitimate public interest.”
Justice Mangatal and Justice McMillan both reached the same conclusion. In exercising the court’s discretion to release the judgment, Justice McMillan noted his concern “in this day and age with the paramount aspect of public access to justice.” Justice Mangatal’s decision to publish also highlights the importance of judgments to the wider public. While the wishes of the parties are to be taken into account by the judge, they are not an overriding factor, particularly in circumstances where a trial is concluded. Suppressing judgments prevents the court from providing useful guidance to the public and the legal profession.
A competing concern is that releasing judgments after settlement may discourage parties from settling their differences at a late stage. However, the court must balance this against the importance of public access to justice. These judgments serve as clear notice that if parties to Grand Court proceedings delay settlement until after a hearing is concluded, they may be too late to prevent release of a judgment. At such time, the decision of whether or not to publish will be in the court’s hands.
Conyers Dill & Pearman is Cayman Islands counsel for Torchlight Fund L.P.
This article was first published in Cayman Financial Review.