April Raquel Penn (Appellant) v First Caribbean International Bank (Bahamas) Ltd (Respondent) (Bahamas)

Case summary

Case ID

JCPC/2025/0048

Jurisdiction

Bahamas

Parties

Appellant(s)

April Raquel Penn

Respondent(s)

FirstCaribbean International Bank (Bahamas) Ltd.

Issue

Is the mortgage agreement between the parties void or voidable on the basis of (i) total failure of consideration or (ii) mistake or frustration? Did the respondent bank have a duty to deliver good and marketable title? Did the instructed attorneys act for the bank such that the bank ought to sue them rather than the appellant for negligence in failing to report on title defects?

Facts

On 4 March 2004, the respondent bank granted a loan of $150,850.00 to the appellant. The loan was secured by a mortgage in the bank’s favour over a property in New Providence. The property was condemned in 2010. A qualified opinion on title was produced by the instructed attorneys, highlighting their observations, and that the appellant would receive good and marketable title. In fact, the property had previously been sold to two separate individuals such that the appellant had not received good and marketable title. As a result, the mortgage failed as a security. The appellant made some payments per the loan agreement but ceased once the property was condemned. The respondent commenced proceedings for payment of the principal loan sum with interest on 28 December 2011. Both courts below held that the appellant breached the terms of the loan agreement by failing to make payments and that neither the doctrines of mistake nor frustration have any application on these facts in relation to the loan agreement. In addition, both courts below held that the attorneys acted for the appellant. The appellant contends that the attorneys act for the respondent bank, such that her position is that the bank’s remedy lies against the attorneys for damages in negligence. The Court of Appeal in the Bahamas granted final leave to appeal to the Judicial Committee of the Privy Council.

Date of issue

3 June 2025

Case origin

Appeal As of Right

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