Family's claim against Jersey trust company is ruled within time limit

Thursday, 03 July 2014
Jersey's Royal Court has ordered the financial and trust services group Minerva to pay GBP11.5 million in damages to the Nolan family, following fraudulent investment.

The 13 family members lost large sums through fraudulent investments they were induced to make by one Gerard Walsh, a former client of one of Minerva's predecessor companies, PTCL. The family alleged that PTCL had dishonestly assisted Walsh by helping him transfer the Nolan's investments to other accounts, some of them available for him to spend for his own use. The basis of the dishonest assistance claim was thus a fraud giving rise to a constructive trust.

Minerva took over PTCL in 2007, after the Nolan incidents had occurred. Its main defence to their suit was that the claims were time-barred, because they should have been made within the usual tort claim limitation period of three years of the family becoming aware of their losses. The Nolans had argued that a claim in dishonest assistance was either not time-barred at all, or only time-barred after ten years.

In a complex judgment just published, the Jersey Royal Court accepted Minerva's assertion of a three-year time limit. But in fact it decided the case in the Nolans' favour.

It reasoned that, although the Nolans knew by January 2008 that they had lost the money which they had invested, they only discovered the role played by PTCL in 2010, when Minerva was forced by injunction to yield up the relevant documents to them. 'We conclude, therefore, that it was not until 2010 that the Nolan family acquired knowledge of all the facts necessary to found an action in dishonest assistance', said the court (Nolan & Ors v Minerva Trust Company Limited and Ors (2014 JRC078A).

The Jersey doctrine of empĂȘchement de fait states that prescription is suspended while it is practically impossible for the plaintiff to bring an action. The clock in the Nolan case therefore did not start until they were in possession of documents sufficient to be able to plead an allegation of fraud or dishonesty. The family launched their action well within three years of receiving the injuncted documents and thus their action was not time-barred.


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