by Mark James Morgan
OMeara Food Products Ltd, Marie Kavanagh and Sharif
Mohammed v- Agricultural Development Bank of Trinidad
Before: Lords Hoffman, Hope of Craighead, Scott of Foscote,
Walker of Gestingthorpe and Baroness Hale of Richmond.
Judgment delivered February 28, 2005.
Fenton Ramsahoye SC and Anand Ramlogan for the Appellants
and Michael Cristal QC (of the English bar), Fyard Hosein
SC and Hannah Thornley (of the English bar) for the Respondent.
The Agricultural Development Bank made a loan to OMeara
repayable in one year. Kavanagh and Mohammed were joined
Under Sections 35 and 42 of its incorporating act, the ADB
was given wide general powers to make loans on conditions
prescribed by its board. Sandwiched between these sections
were provisions which provided for three classes of loans:
short-term loans (not exceeding 18 months), medium-term
loans (between 18 months and 10 years) and long-term loans
(between 10 and 30 years).
The section dealing with medium-term loans (s. 37) provided
that such loans could have sureties, but the section dealing
with short-term loans (s. 36) had no such provision.
The act also made provision for the forms to be used; for
short-term loans, it prescribed Form 18 which was a simple
form without sureties and for the longer term loans, it
prescribed Form 19 which was in a more elaborate form and
made provision for sureties.
Though the loan to OMeara was a short-term loan, the
ADB processed the loan using Form 19 and took sureties for
In an action by the ADB to recover the loan, OMeara
and the sureties argued that in using the wrong form, the
bank went outside of its powers and that the loan was therefore
The Privy Council disagreed. Lord Walker, giving the judgment
of the board, stated that while a statute must be read as
a whole, where a statutory body has several powers which
overlap, there was no principle of construction which restricted
its powers to the limited area common to all the powers.
He acknowledged that sections 36 to 41 of the act, and the
prescribed forms, contained a fairly detailed code.
Lord Walker stated that though this was no doubt of great
practical utility in enabling the officers of the bank and
their customers to arrange a considerable volume of relatively
small loans without incurring unduly large legal costs,
these detailed provisions could not cut down the width of
the general powers granted by sections 35 and 42.
He held therefore it was within the ADBs powers under
the act to decide that a 12-month period was appropriate
for its loan and that it was also appropriate to require
sureties and to use the relatively elaborate form of charge
On that basis the Privy Council dismissed the Appeal.