UNITED STATES v. CARVER and FOUR OTHERS 02-December-1982
[1980–83 CILR 297]
UNITED STATES v. CARVER and FOUR OTHERS
COURT OF APPEAL (Kerr, Ag. P., Rowe and White, JJ.A.): December 2nd, 1982
Evidence—assistance to foreign court—examination of documents and witnesses—under Evidence (Proceedings in Other Jurisdictions) (Cayman Islands) Order 1978, court given general power to make orders for access to documents and witnesses—powers of court in relation to confidential information subject to local legislation, i.e. Evidence Law, 1978, ss. 7–8 and Confidential Relationships (Preservation) Law, s.3A
Evidence—assistance to foreign court—examination of documents and witnesses—if foreign request seeks access to documents and witnesses from bank not party to foreign proceedings, court may order it under Evidence Law, 1978, s.7 only for special cause—special cause established if all other means of obtaining information exhausted and court is last resort
Evidence—banker’s books—production of banker’s books—request for production of “all correspondence, ledgers, day books and account books” used by bank recording particular transactions within definition of “particular documents” in Evidence (Proceedings in Other Jurisdictions) (Cayman Islands) Order 1978, Schedule, s.2(4)(b)—such request not of fishing nature although court may sever offending words
Evidence—banker’s books—inspection of banker’s books—request for court order under Evidence (Proceedings in Other Jurisdictions) (Cayman Islands) Order 1978, Schedule, s.2(1) to inspect banker’s books appropriate even if not made in original letter of request but later by amended summons—order for inspection merely facilitative of order for discovery and no additional right of discovery given
Confidential Relationships—application to court for directions—foreign application for judicial assistance—parties ordered under Evidence (Proceedings in Other Jurisdictions) (Cayman Islands) Order 1978 to produce banker’s books and appear as witnesses must then apply to Grand Court for directions under Confidential Relationships (Preservation) Law, s.3A
Evidence—assistance to foreign court—videotaping of evidence—court should assist foreign court by authorising videotaping of evidence if requested—videotaping challengeable by witness if threat to life or liberty—court can rule upon substantive objections
    The US District Court for the District of Columbia applied by letter of request to the Grand Court for judicial assistance in obtaining evi-
1980–83 CILR 298
dence material to proceedings pending in that court against five persons charged with offences involving fraud.
    Two of the accused in the US proceedings were directors of Cayman companies and it was believed that they had paid the proceeds of the alleged fraud into their companies’ bank accounts in the Islands. Officials of the two Cayman banks concerned refused to testify in the proceedings in the United States or to produce copies of the banks’ records in respect of the companies’ accounts and all governmental attempts to secure their compliance failed.
    As a last resort, the US court made the present application to the Grand Court for orders pursuant to the Evidence (Proceedings in Other Jurisdictions) (Cayman Islands) Order 1978 and the Confidential Relationships (Preservation) Law, as amended, to permit the examination of two named bank officials and to cause both banks to produce “all correspondence, ledgers, day books, account books and all other books, documents and papers” relating to the accounts held by the two companies, “including all records” relating to the receipt of certain sums of money credited to those accounts. It also requested that the examination of the witnesses be videotaped. Subsequently, by way of amended summons during the proceedings, a further request was made for an order permitting the inspection of these documents by an authorised person. The Grand Court (Summerfield, C.J.) refused to grant any of the orders requested.
    On appeal, the appellants submitted that the court had erred in law in denying the requests because (a) the Evidence (Proceedings in Other Jurisdictions) (Cayman Islands) Order 1978, s.2 gave a wide and unequivocal power to the court to make such orders upon an application for judicial assistance from a foreign court, notwithstanding any domestic statutes to the contrary; (b) even if local legislation applied, s.7 of the Evidence Law, 1978 gave the court power, for special cause, to make the orders requested even though neither the banks nor their officials had been made parties to the action and, given that the court was the last resort (all other efforts having failed) through which access could be gained to the documentation, this was a circumstance sufficient to establish special cause; (c) the Confidential Relationships (Preservation) Law, as amended, ought not to be interpreted as establishing a public policy that would allow the laundering of the proceeds of crime in the Cayman Islands, secure from detection and punishment, and so should not in this case be construed narrowly so as to prevent disclosure; (d) where the request referred to “all other books, documents and papers . . . including all records” relating to the particular accounts, it was clear that the specific intention was to examine only those sources which recorded the particular transactions on the particular dates and in the specified forms mentioned; and even if these terms might invalidate the request by being too vague or of a fishing nature, this was an appropriate case for severing and deleting the offending words; and (e) other Commonwealth courts had permitted the videotaping of evidence and although this was not the practice of the Cayman courts, the court should exercise its discretion to allow videotaping of the proceedings
1980–83 CILR 299
since it was central to the request, as the evidence obtained would otherwise be useless in the US court.
    The respondent submitted in reply that the application should not succeed because (a) the request for judicial assistance was unacceptable in that it called for the examination of classes of documents, using terms so wide as to amount to a fishing expedition through the entire accounts of the two companies involved, whereas s.2(4)(b) of the Evidence (Proceedings in Other Jurisdictions) (Cayman Islands) Order 1978 limited the jurisdiction of the court to ordering the production of particular documents only; (b) the court’s power to narrow the scope of the request was confined to circumstances in which the offending words were severable and did not extend to adding to, altering or rewriting the request; as such it was not possible, without offending the statute, to transform classes of documents into particular documents; and (c) in any event, the request for inspection of the banks’ documents did not form part of the original letter of request but had been introduced after the proceedings had started and could not therefore be considered by the court.
    Held, allowing the appeal:
    (1)    Although the Evidence (Proceedings in Other Jurisdictions) (Cayman Islands) Order 1978 generally provided for the court to make orders for the examination of witnesses and the production of documents, such as those specifically requested in the present proceedings, its jurisdiction and powers were subject to the relevant local legislation, i.e. the Evidence Law, 1978, ss. 7 and 8 and the Confidential Relationships (Preservation) Law, s.3A. In response to the request for judicial assistance by the US court, these Laws would have to be considered when making any orders under the 1978 Order (page 311, line 24 – page 312, line 15).
    (2)    Because neither the banks nor their officers were parties to the US proceedings and because the request sought the disclosure of confidential information, by the Evidence Law, 1978, s.7 the court could only assist the US court by issuing such an order for special cause. All other attempts to obtain the material information having failed, the applicant could now only proceed through the court and this circumstance was enough to establish special cause. Consequently, a proper exercise of the Grand Court’s discretion would have been to order the banks and their officers to produce the relevant documents and permit the examination of the named employees in the request as witnesses. The court would therefore make such an order (page 313, line 35 – page 314, line 10).
    (3)    The form of the request for judicial assistance was generally acceptable and it should therefore have been acted upon by the Grand Court. Since it specifically referred to “all correspondence, ledgers, day books and account books used [by the bank] in the ordinary course of business,” in which had been cited or recorded the transactions concerning the receipt of particular sums of money, on particular days, this description sufficiently satisfied the statutory requirement for confining the order to “particular documents” as specified in s.2(4)(b) of the Schedule
1980–83 CILR 300
to the 1978 Order and could not be considered to be of a fishing nature. Other general terms, such as those asking for the examination of broad categories of documents (e.g. “all other books, documents and papers . . . including all records”) which were so vague as to lead to random searches in the hope of obtaining specific evidence, should have been deleted in the exercise of the Grand Court’s discretion. The court would therefore order that such words be deleted (page 319, lines 32–40; page 321, lines 18–31).
    (4)    The court would also order that the inspection of the relevant books and documents be allowed and copies taken. By virtue of the Evidence Law, 1978, s.8 the Grand Court had the power (subject to the Confidential Relationships (Preservation) Law) upon the application of a party to legal proceedings, to order that such a party be allowed to inspect and take copies of a banker’s books and documents. Although the request to inspect them had not been included in the original letter of request, under s.2(1) of the Schedule to the 1978 Order, the court could accept and rule upon a request by way of amended summons; such an order for inspection would not give an additional right of discovery to the appellants but would merely be facilitative of the primary order for discovery and the Grand Court should have authorised the inspection (page 321, line 35 – page 322, line 28).
    (5)    After the order had been made, it was mandatory under the Confidential Relationships (Preservation) Law, s.3A that the parties who were the subjects of the court’s order, apply to the Grand Court for directions within the time specified before any confidential information could be disclosed or any evidence given about it. Accordingly, the court would order the bank officials to make the necessary application under s.3A. When determining such an application, the Grand Court should consider whether, to what extent and under what conditions the confidential information could be given or produced and was to be guided in the exercise of this discretionary jurisdiction by s.3A(6) of the Law (page 316, lines 2–33).
    (6)    There was neither statutory nor judicial authority prohibiting the videotaping of the evidence and the proceedings. Since this was essential to the presentation of the evidence in the foreign court and there was an obligation to assist that court as far as was possible, the court would make an order authorising the videotaping to be done. This was a procedural matter, an order for which was within the general discretionary jurisdiction of the Grand Court. A witness would still have a right to challenge the videotaping of his evidence before the examiner on the basis that it would pose a threat to his life or liberty and the court would then be required to rule upon the substantive objection (page 325, line 17 – page 326, line 7).
Cases cited:
(1)      Arnott v. Hayes (1887), 36 Ch. D. 731, followed.
(2)      Emmott v. StarNewsp. Co. (1893), 62 L.J.Q.B. 77, considered.
1980–83 CILR 301
(3)      Rio Tinto Zinc Corp. v. Westinghouse Elec. Corp., [1977] 3 All E.R. 703; on appeal, [1978] A.C. 547; [1978] 1 All E.R. 434, applied.
(4)      South Staffs. Tramways Co. v. Ebbsmith, [1895] 2 Q.B. 669, dictum of Lord Esher, M.R. applied.
(5)      Tournier v. National Provncl. & Union Bank of England, [1924] 1 K.B. 461; [1923] All E.R. Rep. 550.
(6)      U.S. v. General Elec. Co., District of York County Court, November 19th, 1980, unreported.
(7)      Waterhouse v. Barker, [1924] 2 K.B. 759; [1924] All E.R. Rep. 777, dictum of Scrutton, L.J. applied.
Legislation construed:
Confidential Relationships (Preservation) Law (Law 16 of 1976), s.3A, as added by the Confidential Relationships (Preservation) (Amendment) Law, 1979 (Law 26 of 1979), s.4: The relevant terms of this section are set out at page 312, lines 18–24; page 316, line 35 – page 317, line 4.
Evidence Law, 1978 (Law 13 of 1978), s.7: The relevant terms of this section are set out at page 311, line 32 – page 312, line 5.
s.8: “Subject to the provisions of the Banks and Trust Companies Regulation Law (Revised) and the Confidential Relationships (Preservation) Law on the application of any party to a legal proceeding a court may order that such party be at liberty to inspect and take copies of any matter in a banker’s book for the purpose of such proceeding, and an order under this section may be made with or without summoning the bank or any other party, and shall be served on the bank three clear working days before the same is to be obeyed unless the court otherwise directs.”
Evidence (Proceedings in Other Jurisdictions) (Cayman Islands) Order 1978 (S.I. 1978/1890), Schedule, s.2: The relevant terms of this section are set out at page 302, line 18 – page 303, line 12.
s.5: The relevant terms of this section are set out at page 303, lines 22–24.
Rules of the Supreme Court (England), O.70, r.2:
“Subject to rule 3 an application for an order under the Act of 1975 must be made ex parte and must be supported by affidavit.”
N. Hill, Q.C. and S. McField for the appellant;
R.D. Alberga, Q.C. and J. Martin, Senior Crown Counsel for the Attorney General of the Cayman Islands.

      ROWE, J.A.: By the Evidence (Proceedings in Other Jurisdic- 
  tions) (Cayman Islands) Order 1978, Her Majesty in Council 
  extended to the Cayman Islands the provisions of the United 
  Kingdom’s Evidence (Proceedings in Other Jurisdictions) Act 
  1975 (with the necessary exceptions and modifications to formal 
1980–83 CILR 302

  parts thereof in order to render the Act relevant to the Cayman 
  Islands). This Imperial Order makes provision for the Grand 
  Court of the Cayman Islands to receive applications from terri- 
  tories outside the Cayman Islands for assistance in obtaining evi- 
5  dence for use in those territories in civil as well as in criminal 
  proceedings. 
      If such an application relates to civil proceedings, s.1(b) of the 
  Schedule to the Imperial Order, which is in exactly the same 
  language as s.1(b) of the Imperial Act referred to above, states 
10  that the Grand Court has jurisdiction to hear the application if, 
  inter alia, it is satisfied that the civil proceedings have either been 
  instituted before the requesting court or their institution before 
  that court is contemplated. If either of these conditions precedent 
  is satisfied, the powers of the Grand Court to give effect to the 
15  application for assistance are contained in s.2 of the Schedule to 
  the Imperial Order. Section 2(1), (2), (3) and (4) all have rel- 
  evance to this appeal and I will set them out below: 
          “(1) Subject to the provisions of this section, the Grand 
      Court shall have power, on any such application as is men- 
20      tioned in section 1 above, by order to make such provision 
      for obtaining evidence in the Cayman Islands as may appear 
      to the court to be appropriate for the purpose of giving effect 
      to the request in pursuance of which the application is made; 
      and any such order may require a person specified therein to 
25      take such steps as the court may consider appropriate for 
      that purpose. 
          (2) Without prejudice to the generality of subsection (1) 
      above but subject to the provisions of this section, an order 
      under this section may, in particular, make provision— 
30          (a) for the examination of witnesses either orally or in 
                writing; 
          (b) for the production of documents; 
          . . . 
          (3) An order under this section shall not require any par- 
35  ticular steps to be taken unless they are steps which can be 
  required to be taken by way of obtaining evidence for the pur- 
  poses of civil proceedings in the court making the order 
  (whether or not proceedings of the same description as those 
  to which the application for the order relates); but this sub- 
40  section shall not preclude the making of an order requiring a 
  person to give testimony (either orally or in writing) otherwise 
1980–83 CILR 303

      than on oath where this is asked for by the requesting court. 
          (4) An order under this section shall not require a per- 
      son— 
          (a) to state what documents relevant to the proceed- 
5                ings to which the application for the order relates 
                are or have been in his possession, custody or 
                power; or 
          (b) to produce any documents other than particular 
                documents specified in the order as being docu- 
10                ments appearing to the court making the order to 
                be, or to be likely to be, in his possession, custody 
                or power.” 
      Special provision is made in the Imperial Order for giving 
  assistance when the request from the foreign court is in relation to 
15  criminal proceedings. By s.5 of that Order, the provisions of ss. 
  1–3 of the Order (which relate to civil proceedings) are made 
  applicable to criminal proceedings with certain stated exceptions. 
  The first important exception is that it is not enough that proceed- 
  ings of a criminal nature should be contemplated in the request- 
20  ing country; they must have actually been instituted. And the 
  second important exception is stated in s.5(1)(c) in these terms: 
      “No order under section 2 above shall make provision other- 
      wise than for the examination of witnesses, either orally or 
      in writing, or for the production of documents.” 
25      It is to be observed at this stage that whereas s.2(2) gives an 
  unexhaustive list of six separate orders that the Grand Court may 
  make in a request touching civil proceedings, when the request 
  relates to criminal proceedings only those enumerated in 
  s.2(2)(a) and (b) are permissible. That sub-section was, however, 
30  expressly made to be without prejudice to the generality of s.2(1). 
  To these provisions I will return. 
      There is pending in the US District Court for the District of 
  Columbia, an Indictment No. 8100342 which charges five accused 
  persons, viz. Roy A. Carver, Joseph C. Lemire, Lionel W. 
35  Achuck, Jon T. Stephens and Interconex, Inc. on seven counts, 
  five of which are alleged to be in violation of US Code, Title 18, 
  para. 1343 and the other two counts in violation of Title 18, para. 
  2314. This indictment was presented by a grand jury and in sup- 
  port of the application for the judicial assistance of the Grand 
40  Court, Mr. John D. Arterberry, an attorney of the US Depart- 
  ment of Justice, swore to an affidavit on October 20th, 1981, in 
1980–83 CILR 304

  which he summarized the facts upon which the grand jury based 
  its findings. That affidavit reads in part: 
          “Through my familiarity with the documents obtained in 
      this matter and the statements of witnesses, I can state that 
5      the following facts, in part, formed the basis for the grand 
      jury’s finding of probable cause in this matter, and can be 
      established by the United States in a trial on the indictment 
      in this case. 
          In early 1976, Raytheon Middle East Systems Co. . . . 
10      required the construction and transportation of modular 
      homes to be delivered to Saudi Arabia in connection with 
      Raytheon’s air-defence system contract with the Saudi 
      Government. The homes were to house Raytheon 
      employees working on the air-defence project and also 
15      Saudi military personnel, once the sites became operational. 
          Recognizing that the contracts for the modular homes 
      would involve substantial shipping costs, the defendants 
      devised a scheme to exploit this situation by manipulating 
      Raytheon procurement procedures so that defendant Inter- 
20      conex, Inc. would receive transportation sub-contracts with 
      nearly $3m. in inflated charges. This scheme was accom- 
      plished by inducing the prime contractor, International 
      Modular Systems Ltd. (hereinafter ‘IMS’), to award ship- 
      ping sub-contracts to defendant Interconex, after IMS had 
25      been awarded prime contracts from Raytheon through a bid 
      evaluation process manipulated by the defendants. 
          The defendants’ scheme called for the diversion of the 
      excess shipping costs to foreign banks to disguise and conceal 
      the existence and subsequent distribution of the scheme pro- 
30      ceeds. To that end IMS was further induced by the defend- 
      ants to shift portions of the shipping sub-contracts with 
      defendant Interconex to Generation Holdings Ltd., an entity 
      controlled by one or more of the defendants. Thus between 
      September and December 1976, Raytheon unwillingly paid 
35      approximately $2.1m. in excess shipping costs under the con- 
      tracts, which funds IMS then caused to be transferred to 
      Generation Holdings’ account at the Credit Suisse in 
      Geneva, Switzerland. This $2.1m. represents the amount 
      that Raytheon was defrauded by this scheme. Raytheon 
40      avoided further losses by cancelling the shipping sub-contract 
      upon discovery of the inflated transportation charges. 
1980–83 CILR 305

          At the direction of defendant Lionel W. Achuck, the 
      General Holdings Administrator distributed approximately 
      $lm. of these funds to defendants Roy A. Carver and Joseph 
      C. Lemire by means of checks payable to Redcon Establish- 
5      ment and Redcon Ltd., companies controlled by Carver and 
      Lemire, and another $lm. of these funds to Coraldo Trust 
      Reg., a company controlled by defendant Jon T. Stephens.” 
  He then illustrated this distribution by a chart. 
      Mr. Arterberry gave a further affidavit sworn to on January 
10  12th, 1982 in which he dealt specifically with the Cayman connec- 
  tion. He said: 
          “The materiality of the testimony of the following named 
      foreign witnesses, and of other evidence sought in the Cay- 
      man Islands, and the proof of the unavailability of these wit- 
15      nesses in the United States, is set forth below: 
          Witnesses 
      A. David Challice, Barclays Bank International Ltd., Grand 
      Cayman. 
          At least $294,000 of the bribe funds received by Carver and 
20      Lemire were deposited into an account held by International 
      Resource Management Consultants at Barclays Bank Inter- 
      national Ltd. in Grand Cayman. International Resource 
      Management Consultants was a Cayman Island company 
      controlled by Carver and Lemire. The deposits were made by 
25      means of a $200,000 wire transfer to a Barclays Bank account 
      from a Swiss bank account controlled by Carver and Lemire 
      and by means of two checks payable to Carver’s wife, Heid- 
      run, which were endorsed by Mr. Challice, a Barclays Bank 
      officer, and deposited into the same International Resource 
30      Management Consultants’ account at Barclays Bank . . . . 
      . . . . 
      C. Cyrus Regnart, Bank of Nova Scotia, Grand Cayman. 
          Redcon Ltd., another Cayman Island entity controlled by 
      Carver and Lemire, held an account at the Bank of Nova Sco- 
35      tia in Grand Cayman. That account received at least $500,000 
      of the bribe funds paid to Carver and Lemire. These funds 
      were deposited into the account by means of three checks, 
      two payable to Redcon Ltd. and the third payable to Redcon 
      Establishment, a Liechtenstein entity controlled by Carver 
40      and Lemire. Cyrus Regnart, a bank officer, is believed to 
      have been employed at the bank during the relevant period.” 
1980–83 CILR 306

  The affidavit further stated that both Mr. Challice and Mr. Reg- 
  nart had advised the Cayman Islands Police that they would not 
  voluntarily testify in the United States nor produce or authenti- 
  cate the records of Barclays Bank or the Bank of Nova Scotia. 
5      On the basis of the facts sworn to by Mr. Arterberry in support 
  of the allegations contained in the indictment referred to earlier, 
  the United States Government approached the Government of 
  the Cayman Islands and requested that Government to use its 
  good offices to secure the testimony in the United States of, inter 
10  alia, the officials of the Bank of Nova Scotia and of Barclays Bank 
  International Ltd. and for the production in the United States of 
  bank records in connection with the accounts of International 
  Resource Management Consultants at Barclays Bank and of Red- 
  con Ltd. at the Bank of Nova Scotia. The banks and their officers 
15  refused to co-operate. 
      Another administrative procedure was resorted to. Under the 
  provisions of s.3(2)(b)(iii) of the Confidential Relationships (Pre- 
  servation) Law of the Cayman Islands as amended by the Confi- 
  dential Relationships (Preservation) (Amendment) Law, 1979 
20  (hereinafter referred to . as the “Confidential Relationships 
  Law”), a disclosure of confidential information to a constable of 
  the rank of inspector or above, who is specifically authorised by 
  the Governor of the Cayman Islands in that behalf for the pur- 
  pose of investigating an offence committed or alleged to have 
25  been committed outside the Cayman Islands which offence, if 
  committed in the Islands, would be an offence against its laws, 
  would not be prohibited or in any way regulated by the provisions 
  of the Confidential Relationships Law. 
      An inspector of police acting under the authorisation of the 
30  Governor endeavoured to obtain the relevant bank records 
  referred to above and to obtain statements from Mr. Challice and 
  Mr. Regnart, but he did not succeed. Accordingly, the Govern- 
  ment of the Cayman Islands declined to take any further persua- 
  sive action and advised the United States Government to adopt 
35  alternative strategies, if it was so minded, but advised that in that 
  event it would have to proceed through its own attorney-at-law 
  and could no longer depend upon the good offices of the 
  Attorney General of the Cayman Islands. 
      And so it came about that a formal request for international 
40  judicial assistance by the US District Court for the District of Col- 
  umbia to the Grand Court dated February 10th, 1982, came 
1980–83 CILR 307

  before the Grand Court by summons filed on March 18th, 1982. 
  As a result of an order made by the learned Chief Justice of the 
  Cayman Islands on the hearing of this summons, a supplemental 
  request was issued by the US District Court in the same proceed- 
5  ings dated April 20th, 1982, and this supplemental request came 
  before the Grand Court by means of a summons filed April 27th, 
  1982. The portion of the request relevant to this appeal is set out 
  below: 
          “This Court further requests the Grand Court to make 
10      orders pursuant to the Evidence (Proceedings in Other Jur- 
      isdictions) (Cayman Islands) Order 1978 and Confidential 
      Relationships (Preservation) Law, as amended, and the 
      Bankers and Trust Companies Regulation Law, as 
      amended, to permit the following witnesses to give evidence 
15      on all matters raised by the indictment and matters directly 
      related thereto and to produce documents as set forth in the 
      following schedule. 
          David Challice and the proper officer of Barclays Bank 
      International Ltd., Grand Cayman, as custodian of records, 
20      to produce all correspondence, ledgers, day books, account 
      books and all other books, documents and papers used in 
      the ordinary course of business relating to the account or 
      accounts held by International Resource Management Con- 
      sultants, including all records relating to the account or 
25      accounts held by International Resource Management Con- 
      sultants, [sic] including all records relating to the receipt of 
      $294,000 on or about June 27th, 1977 and two checks 
      ($44,000 and $50,000) payable to Heidi Carver and 
      deposited into the account or accounts on or about 
30      November 4th, 1977, and of the subsequent disposition of 
      the said funds. 
          Cyrus Regnart, Bank of Nova Scotia, Grand Cayman, to 
      produce all correspondence, ledgers, day books, account 
      books and all other books, documents and papers used in 
35      the ordinary course of business relating to the account or 
      accounts held by Redcon Ltd., including all records relating 
      to the receipt of $500,000 which funds were credited to the 
      account or accounts by means of three checks ($300,000; 
      $100,000 and $100,000) payable to Redcon and deposited 
40      into the account or accounts on or about November 8th, 
      1977, and the subsequent disposition of the said funds. The 
1980–83 CILR 308

      proper officer of the Bank of Nova Scotia, as custodian of 
      records, to produce all correspondence, ledgers, day books, 
      account books and all other books, documents and papers 
      used in the ordinary course of business relating to the 
5      account or accounts held by Redcon Ltd., including all 
      records relating to the receipt of $500,000, which funds were 
      credited to the account or accounts by means of three checks 
      ($300,000; $100,000; $100,000) payable to Redcon and 
      deposited into the account or accounts on or about 
10      November 8th, 1977, and the subsequent disposition of the 
      said funds.” 
  It is to be noted that the original request of February 10th, 1982 
  contained this express request: 
      “And this court further requests that you will be pleased to 
15      cause the evidence of the said witnesses to be reduced into 
      writing and recorded by means of videotape.” 
      The amended summons of April 27th, 1982, asked, inter alia, 
  for an order that the examination of the witnesses be videotaped 
  and for an order of inspection in the following terms: 
20          “And further for an order pursuant to s.8 of the Evidence 
      Law 1978 authorizing John D. Arterberry, Attorney of the 
      US Department of Justice or any other lawful representative 
      of the United States of America, to inspect and take copies 
      of all entries in any ledgers, day books, cash books, account 
25      books or correspondence and in any other books used in the 
      ordinary course of business of Barclays Bank International 
      Ltd., Grand Cayman; the Bank of Nova Scotia Ltd., Grand 
      Cayman; Anglo-Dutch Insurance Co., Grand Cayman and 
      the Registrar of Companies, Cayman Islands, relating to all 
30      the matters, transactions and accounts raised by the indict- 
      ment and matters, transactions and accounts directly related 
      thereto.” 
      The learned Chief Justice in his judgment of April 19th, 1982, 
  refused to make an order for the inspection of documents and for 
35  the videotaping of the proceedings, and he made no order in 
  respect of the two commercial banks or of their officers, Mr. 
  Challice and Mr. Regnart. In his further order of May 12th, 1982, 
  he did not resile from any of the positions he had taken in April. 
  As a consequence of his later order, the US Government 
40  appealed to this court and the six grounds of appeal filed and 
  argued sought to show that in denying the requests to (a) Messrs. 
1980–83 CILR 309

  Challice and Regnart to give evidence; (b) the custodian of the 
  records of the Bank of Nova Scotia Ltd. and Barclays Bank Inter- 
  national Ltd. to produce the requested documents; (c) the video- 
  taping of the evidence of witnesses and (d) the inspection of the 
5  banks’ documents, the learned Chief Justice erred in law. 
      When an application is made to the Grand Court for inter- 
  national judicial assistance, that court acts in accordance with the 
  procedure contained in the English Rules of the Supreme Court, 
  O.70. Order 70, r.2 prescribes that the application must be made 
10  ex parte and it is stated in 1 The Supreme Court Practice 1982, 
  para. 70/1–6/23 that if an order is made, which must perforce be 
  ex parte, an application may be made by summons supported by 
  affidavit to discharge the order. The effect of these provisions is 
  that an ex parte order made by the Grand Court on a request for 
15  judicial assistance is in the nature of a provisional order which can 
  only become absolute if the person to whom it is directed does 
  not seek to have it discharged or if his challenge to the order is 
  rejected. It further means that the ex parte order must be served 
  upon the person to whom it relates—and so give him an oppor- 
20  tunity to challenge it. 
      It was common ground that the principles which govern the 
  exercise of the jurisdiction to grant requests for international 
  judicial assistance in England are applicable to the Cayman 
  Islands and I can do no better than to quote certain passages from 
25  the judgment of Summerfield, C.J. of April 19th, 1982, as to what 
  these principles are: 
          “As to the procedure for applications of this nature, my 
      view is that O.70 (in conjunction with the rules specified 
      therein of O.39) of the English Rules of the Supreme Court 
30      1965 apply by virtue of s.20 of the Grand Court Law read 
      with r.62 of the Grand Court (Civil Procedure) Rules. The 
      Grand Court (Foreign Process) Rules do not appear to be 
      appropriate. 
          . . . . 
35          In England, the general principles which should be fol- 
      lowed in relation to a request from a foreign court for assist- 
      ance in obtaining evidence for the purposes of proceedings 
      in that court, are that the English court will ordinarily give 
      effect to such request so far as is proper and practicable and 
40      to the extent that is permissible under English law. This 
      principle reflects judicial and international comity and it 
1980–83 CILR 310

      conforms with the provisions of the Hague Convention and 
      the 1975 Act as it conformed with the spirit of the former 
      statutes. It is the duty and the pleasure of the English court 
      to do all it can to assist the foreign court, just as the English 
5      court would expect the foreign court to help it in like circum- 
      stances. Just as the English court ought to give full faith and 
      credit to a foreign judgment, so should it give full faith and 
      credit to the request of a foreign court for evidence to assist 
      its proceedings. 
10          In dealing with a request for evidence from a foreign 
      court, the English court has first to decide whether it has jur- 
      isdiction to make an order to give effect to the request and, 
      secondly, if it has, whether as a matter of discretion it ought 
      to make or refuse to make such an order. As a matter of jur- 
15      isdiction, in the ordinary way and in the absence of evidence 
      to the contrary the English court should be prepared to 
      accept the statement of the foreign court in its request that 
      the evidence is required for the purposes of civil or criminal 
      proceedings; as the case may be, in that court. On the other 
20      hand, the form of the letter of request is not conclusive; the 
      court must examine the request objectively by the nature of 
      the testimony sought, and it has to look at the substance of 
      the matter, but it may have regard to what was said in the 
      foreign court when the request for evidence was issued. If 
25      there is any doubt about the matter, the English court may 
      allow the parties to refer back to the foreign court or judge 
      who issued the request for evidence. 
          As a matter of discretion, again in the ordinary way, the 
      English court should exercise its discretion to make the 
30      order asked for unless it is satisfied that the application 
      would be regarded as falling within the description of frivo- 
      lous, vexatious or an abuse of the process of the court. The 
      English court has power to accept or reject the foreign 
      request in whole or in part, whether as to oral or documen- 
35      tary evidence; and it can and should delete from the foreign 
      request any parts that are excessive either as regards wit- 
      nesses or as regards documents. The English court will act 
      on the principle that it should salve what it can, but should 
      decline to comply with the foreign request in so far as it is 
40      not proper or permissible or practicable under English law 
      to give effect to it. The English court, moreover, ought not 
1980–83 CILR 311

      to embark on the process of restructuring or re-casting or re- 
      phrasing the foreign request so that it becomes different in 
      substance from the original request. The court has no power 
      so to modify the original foreign request as to substitute a 
5      different category of documents for the category which has 
      been requested by the foreign court.” 
      In support of his several grounds of appeal Mr. Hill argued, 
  first, that s.2 of the Imperial Order stands by itself and gives a 
  wide power to the court notwithstanding any other law to the con- 
10  trary. By this he meant that the domestic statutes of the Cayman 
  Islands ought not to be looked at in determining the circum- 
  stances in which international judicial assistance could be 
  afforded by the Grand Court. In so far as this argument pro- 
  ceeded on the basis that the common law rules relating to the 
15  duties of bankers to disclose information cannot be derogated 
  from by statutory enactment unless the statute expressly, unambi- 
  guously and unequivocally so states, it does not in my view have 
  merit. The decision of the Court of Appeal in Tournier v. 
  National Provncl. & Union Bank of England (5) is subject to any 
20  statutory provision in the Cayman Islands and the principles 
  adumbrated in that case cannot be relied upon in a case of this 
  nature without reference to the provisions of ss. 7 and 8 of the 
  Evidence Law, 1978 and to the provisions of the Confidential 
  Relationships Law of the Cayman Islands. Notwithstanding the 
25  apparent clarity of the language of s.2 of the Imperial Order, it 
  must be read in conjunction with the domestic statutes of the 
  Cayman Islands and in a case where the disclosure of confidential 
  information is sought from the books of bankers, resort must be 
  had to the provisions of the Evidence Law. 
30      Provision is made in s.7 of the Evidence Law for the method in 
  which proof of entries in a banker’s books may be obtained. 
          “(1) Subject to the provisions of the Banks and Trust 
      Companies Regulation Law (Revised) and the Confidential 
      Relationships (Preservation) Law and to subsection (2), a 
35      copy of an entry in a banker’s book certified by an officer of 
      such bank in an affidavit made before a Justice of the Peace 
      or by oral testimony to be a true copy is receivable in every 
      court as prima facie evidence of such entry and of the 
      matters, transactions and accounts therein recorded. 
40          . . . . 
          (3) No bank or officer of such bank shall in any proceedings 
1980–83 CILR 312

      before any court in which the bank is not a party, be compell- 
      able to produce any banker’s book the contents of which can 
      be proved under subsection (1), or appear as a witness to 
      prove the matters, transactions and accounts therein 
5      recorded, unless by order of a court made for special cause.” 
      One of the enactments to which s.7 above is made subject, is 
  the Bank and Trust Companies Regulation Law (Revised). That 
  statute has no relevance to these proceedings. The other enact- 
  ment is of great significance not only to this case but for the econ- 
10  omic well-being of the Cayman Islands. Except as is provided in 
  s.2 of the Confidential Relationships Law, no one may disclose 
  confidential information, which is defined to include information 
  concerning any property which the recipient thereof is not, other- 
  wise than in the normal course of business, authorized by the 
15  principal to divulge, except under the procedure outlined in s.3A. 
  All the provisions of s.3A are relevant to this appeal but for the 
  moment I will content myself in referring to sub-s. (1) thereof: 
          “Whenever a person intends or is required to give in evi- 
      dence in, or in connection with, any proceeding being tried, 
20      inquired into or determined by any court, tribunal or other 
      authority (whether within or without the Islands) any confi- 
      dential information within the meaning of this Law, he shall 
      before so doing apply for directions and any adjournment 
      necessary for that purpose may be granted.” 
25      Where a request is made to a banker for the production of a 
  certified copy of entries in his books, he may be perfectly willing 
  to accommodate the requisitioning party. But because of s.3A of 
  the Confidential Relationships Law, he must apply for directions 
  under that Law before he can give the evidence. On the other 
30  hand, the banker may be unwilling to give any co-operation. Sup- 
  pose as in the instant case, he refuses to take any steps whatever 
  to comply with the request. What must the requesting party do? 
  If he serves him with a subpoena duces tecum, the banker may 
  ignore it. And if he so acted he would have authority on his side 
35  to buffer his action. According to Paget’s Law of Banking, 8th 
  ed., at 170–171 (1972)— 
      “it is very improbable that a banker would ever now be 
      simply served with a subpoena duces tecum in proceedings to 
      which he was not a party. If he were, he might disregard it, 
40      the only legitimate method of compelling his attendance 
      being the special order under s.6 . . . .” 
1980–83 CILR 313

      In Emmott v. Star Newspaper Co. (2), the Divisional Court in 
  England construed ss. 2 and 3 of the Bankers’ Books Evidence 
  Act 1879, the provisions of which are similar to ss. 7 and 8 of the 
  Evidence Law of the Cayman Islands. Lord Coleridge, C.J., after 
5  setting out the common law position in regard to the duty of a 
  banker to supply evidence, referred to the provisions of the Act 
  and then concluded (62 L.J.Q.B. at 78): “If the banker does not 
  choose to follow out these provisions of the Act, he is left with the 
  old burden of personal attendance and production of the books.” 
10  Later he said (ibid., at 79): “If there were evidence that the 
  banker was setting the Act at defiance and would do nothing, 
  then the Court ‘may’ interfere with an order . . . .” 
  The opinion of A.L. Smith, L.J. was to the same effect. He said 
  (ibid.): 
15      “It is a mistake to say that section 6 absolves a banker from 
      coming in person, or from producing his books in every case 
      to which his bank is not a party. It only does so when he 
      craves the aid of, and follows out the provisions laid down in 
      sections 2 to 5. Then comes section 7, which gave rise to the 
20      discussion in Arnott v. Hayes . . . . There it was laid down 
      that the two objects of the Act were—first, to give relief to 
      bankers from the production of bank-books, unless, under 
      special circumstances, it became advisable to have the actual 
      books produced . . . . 
25  Mr. Hill submitted that the words “special circumstances” are 
  wide, comprehensive and flexible words in relation to which a court 
  ought not to lay down any exhaustive definition and he referred us 
  to 5 Words and Phrases Legally Defined, 2nd ed., at 94 (1970) for 
  support. I do not dissent from his proposition. What are special 
30  circumstances must depend upon the facts of each case. Mr. 
  Alberga, in his very helpful presentation, agreed that if a banker 
  flatly refused to co-operate with a requesting party and declined to 
  provide examined copies of his books, that refusal could amount to 
  special cause within the meaning of s.7(3) of the Evidence Law. 
35      In my view, there were factors in this case which could amount 
  to special cause. Evidence was being sought for use in a foreign 
  judicial tribunal and if the actual books were not produced before 
  the examiner, the evidence obtained would be useless in the 
  foreign tribunal. There was no question of the bankers’ books 
40  being taken out of the jurisdiction and the minor inconvenience 
  to the bank to take its books before the examiner and produce 
1980–83 CILR 314

  them would be greatly outweighed by the court’s obligation to 
  take all necessary steps to give effect in comity to the foreign 
  request. All earlier efforts by the US Government to obtain the 
  information from the bankers in circumstances where the Confi- 
5  dential Relationships Law would not be applicable had been 
  unsuccessful. Therefore, in the face of the bankers’ intransigence, 
  there was no method by which the requesting party could gain 
  access to the bankers’ books without the order of the court made 
  for special cause. In my view special cause was abundantly made 
10  out. 
      But even if special cause is shown under s.7(3), that is not an 
  end of the matter as, in the instant case, the accounts from which 
  evidence is being sought are not in the names of any of the 
  defendants indicted in the requesting court. An undoubted rule 
15  which applies to applications for inspection of bankers’ books 
  prior to the trial, equally applies in my view to an application for 
  examined copies of the bankers’ books or for the production of 
  these books. That rule as to inspection is best exemplified in the 
  case of South Staffs. Tramways Co. v. Ebbsmith (4) where the 
20  issue was whether an order for inspection under s.7 of the 
  Bankers’ Books Evidence Act 1879 could be made when the 
  account was in the name of a person not a party to the action and 
  if so in what circumstances. Lord Esher, M.R. said ([1895] 2 Q.B. 
  at 674–675): 
25      “The application is for an order to inspect before the trial an 
      account which is prima facie not that of a party to the suit. I 
      am disposed to think that the rule of conduct which the 
      Court would observe in relation to such an application— 
      though it is impossible to define it exhaustively—would be 
30      that, if the Court were satisfied that in truth the account 
      which purported to be that of a third person was the account 
      of the party to the action against whom the order was 
      applied for, or that, though not his account, it was one with 
      which he was so much concerned that items in it would be 
35      evidence against him at the trial, and there were no reason 
      for refusing inspection, then they might order the inspec- 
      tion; but, unless they were so satisfied, they ought not to do 
      so . . . . I think that the party asking for the inspection ought 
      to be able to shew the Court very strong grounds for suspi- 
40      cion, almost amounting to certainty, that there are items in 
      the account which would be material evidence against the 
1980–83 CILR 315

      defendant upon the matters in issue. I requested the counsel 
      for the plaintiffs to tell me what grounds he had for the 
      suggestion that there were items of that character in this 
      account.” 
5      In applying the principles adumbrated by Lord Esher, M.R. to 
  the facts of the instant case, one finds that the allegations in the 
  indictment, supported by the affidavit of Mr. Arterberry, are that 
  International Resource Management Consultants, a Cayman 
  company, was controlled by the defendants Carver and Lemire 
10  and that some $294,000 were transferred to its account by means 
  of a transfer of $200,000 from a Swiss bank account controlled by 
  Carver and Lemire and by two cheques payable to Carver’s wife. 
  Further, that Redcon Ltd. was controlled by Carver and Lemire 
  and that company received $500,000 from a Liechtenstein entity 
15  controlled by the said Carver and Lemire. These allegations were 
  so specific that, in my view, they would easily have satisfied Lord 
  Esher when he propounded his test of “suspicion, almost 
  amounting to certainty.” Lord Esher was prepared to accept the 
  argument of counsel as to the effect of the pleadings. In the 
20  instant case, in the face of the affidavit of Mr. Arterberry, there 
  was ample evidence which the learned Chief Justice could have 
  taken into consideration on the ex parte application. 
      As soon as it was established that there was sufficient evidence 
  to move the court to decide that special cause existed for ordering 
25  the banker to produce his books, it is beyond question that a 
  court would exercise its discretion to make the appropriate order. 
  The next legal step which would be mandatory would be the ser- 
  vice of that order upon all interested parties. Were this a wholly 
  municipal case, the order of the court that special cause existed 
30  would be immediately operative and would be effective only sub- 
  ject to the provisions of the Confidential Relationships Law. But 
  as was pointed out earlier, because an application for inter- 
  national judicial assistance must be initiated by an ex parte pro- 
  cedure, the first opportunity that an interested party, be he 
35  banker or other category of person, would have to contest the 
  validity of the order would be after service thereof upon him. If 
  he chooses not to contest the ex parte order, then he must comply 
  with its terms. Should such an interested party seek to have the 
  order set aside, he would after the appropriate hearing be com- 
40  pelled to abide by the order of the court. 
      Messrs. Challice and Regnart were required to give evidence in 
1980–83 CILR 316

  their personal capacities and they could not avail themselves of 
  any of the provisions of s.7 of the Evidence Act. If, however, on 
  the request for judicial assistance, an order were made for them 
  to give evidence, in the event that that evidence related to confi- 
5  dential information, they would fall into the category of persons 
  required to give evidence under s.3A of the Confidential Rela- 
  tionships Law and would be obliged to seek directions of the 
  Grand Court before complying with that order to give evidence. 
  A person so required to give evidence is not afforded the option 
10  to decide whether or not it is convenient for him to give the evi- 
  dence or even to apply under s.3A for directions. Under the pro- 
  visions of s.3A it is mandatory for him to make the application 
  and I might add, where a time-limit is stipulated, he must act 
  within that fixed period. 
15      One must never make the mistake of blurring the lines of the two 
  separate jurisdictions which have an interplay when an application 
  for international judicial assistance touches and concerns confi- 
  dential information. The first question to be determined in any 
  given case is whether a person can be required to give evidence as 
20  to confidential information and the second is to determine, accord- 
  ing to the special statutory provisions of the Cayman Islands 
  whether, to what extent, and subject to what conditions, such a 
  person is to be allowed to give the evidence. The two jurisdictions 
  are vested in the Grand Court and may indeed be exercised by the 
25  same personage but the rules of law relevant to the first enquiry 
  may be wholly irrelevant to the other. The judge of the Grand 
  Court must never, when exercising his functions to determine the 
  first question, take into consideration questions of policy which 
  might have the effect of prejudging the situation as to how he 
30  would rule on the aspect of the question when an application is 
  made under s.3A. In particular, the Grand Court is given guide- 
  lines as to the matters to be taken into consideration when exercis- 
  ing jurisdiction under s.3A of the Confidential Relationships Law. 
      Section 3A(6) provides: 
35          “In considering what order to make under this section a 
      Judge shall have regard to— 
          (a) whether such order would operate as a denial of the 
                rights of any person in the enforcement of a just 
                claim; 
40          (b) any offer of compensation or indemnity made to 
                any person desiring to enforce a claim by any per- 
1980–83 CILR 317

                son having an interest in the preservation of secrecy 
                under this Law; 
          (c) in any criminal case, the requirements of the inter- 
                ests of justice.” 
5      It would therefore appear that the policy of the legislature is 
  that the confidentiality laws of the Cayman Islands should not be 
  used as a blanket device to encourage or foster criminal activities. 
  As Mr. Hill puts it, there is nothing in the statute to suggest that it 
  is the public policy of the Cayman Islands to permit a person to 
10  launder the proceeds of crime in the Cayman Islands, secure from 
  detection and punishment. I can find no disharmony between s.2 
  of the Imperial Order, s.7 of the Evidence Law and the provisions 
  of the Confidential Relationships Law, as in my view each statute 
  is relevant to different stages of the proceedings. There is nothing 
15  in the Imperial Order to indicate that it was establishing a regime 
  and a procedure unaffected by any provisions that may exist in 
  the statute law of the Cayman Islands. On the contrary, s.2(3) 
  thereof makes particular reference to the procedures of the civil 
  courts in the Cayman Islands. Although ss. 7 and 8 of the Evi- 
20  dence Law are made subject to the provisions of the Confidential 
  Relationships Law, what this means is that before a banker can 
  supply either examined copies, or produce the originals of his 
  books, he must seek the directions of the Grand Court under the 
  Confidential Relationships Law. The final stage is reached only 
25  when the application is made to the Grand Court by the prospec- 
  tive witness and the Grand Court will then make an order after 
  considering and giving full weight to the provisions of s.3A(6). 
  The substantial question which next arose for decision was 
  whether the request for judicial assistance was transmitted in a 
30  form which could be accepted and acted upon by the Cayman 
  court. Section 2(4)(b) of the Schedule to the Imperial Order 
  which confers the jurisdiction upon the Grand Court places a 
  limitation upon the documents, the production of which can be 
  ordered. It states: 
35          “An order under this section shall not require a person— 
          . . .  
          (b) to produce any documents other than particular 
                documents specified in the order as being docu- 
                ments appearing to the court making the order to 
40                be, or to be likely to be, in his possession, custody 
                or power.” 
1980–83 CILR 318

      In s.2(4)(a), a court is prohibited from making an order for 
  general discovery of documents as such an order would be in the 
  nature of a fishing expedition. The two sub-sections must there- 
  fore be read together to discover the true intention of the legisla- 
5  ture as to the documents in respect of which an order for 
  production may be made. Section 2(4)(b) of the Imperial Act was 
  judicially considered by the.House of Lords in Rio Tinto Zinc 
  Corp. v. Westinghouse Elec. Corp. (3). 
      Lord Diplock, after reference to the facts of that case, said 
10  ([1978] 1 All E.R. at 463): 
          “The request for the production of documentary evidence 
      by the two RTZ companies must satisfy not only the require- 
      ments of sub-s. (3) which exclude fishing discovery, but also 
      the stricter requirements of sub-s. (4). Under the procedure 
15      of the High Court of England there is no power to order dis- 
      covery of documents by a person not a party to the action, 
      but such a person can be required by subpoena duces tecum 
      to produce documents to the court or, where his evidence is 
      taken before an examiner prior to the trial, at such examin- 
20      ation. There is a good deal of authority cited by Lord Den- 
      ning M.R. in his judgment as to how specific the reference to 
      documents must be in subpoena duces tecum. Classes of 
      documents, provided the description of the class is suf- 
      ficiently clear, may be required to be produced on subpoena 
25      duces tecum. 
          The requirements of s.2(4)(b), however, are not in my 
      view satisfied by the specification of classes of documents. 
      What is called for is the specification of ‘particular docu- 
      ments’ which I would construe as meaning individual docu- 
30      ments separately described.” 
      The request for judicial assistance in that case failed on the 
  ground of privilege. When this case was in the Court of Appeal, 
  Lord Denning, M.R. had suggested that the test of whether the 
  documents should be treated as particular documents was that 
35  they should be specified with such distinctiveness as would be suf- 
  ficient for a subpoena duces tecum. The Master of the Rolls ela- 
  borated by saying ([1977] 3 All E.R. at 710): 
      “The description should be sufficiently specific to enable the 
      person to put his hands on the documents or the file without 
40      himself having to make a random search, in short, to know 
      specifically what to look for . . . . The person ought not to 
1980–83 CILR 319

      be required to chase through masses of documents to see 
      whether this or that may or may not relate to the dispute.” 
      The documents referred to in the Westinghouse case were of 
  the most diverse, varied and complex variety. Consequently, the 
5  language of the members of the House of Lords must be looked 
  at against those facts. On the other hand, the traditional descrip- 
  tion of bankers’ books used by bankers in the ordinary course of 
  business has been “ledgers, day books and account books.” 
  When therefore these terms are used in a statute or in business 
10  correspondence they must be taken to relate to the actual books 
  used by the particular bank in the keeping of its accounts. An out- 
  sider would be at a disadvantage if he were to be compelled to 
  know the precise system of accounting used by the bank and the 
  precise and particular documents in which the bank’s accounting 
15  records are kept. What such a third person must show is that he 
  requires information regarding a particular transaction made on a 
  particular day, in respect of a particular account. Where the 
  banker is merely required to place his hands upon and to pick up 
  the letter which forwarded the cheque, or the lodgment slip which 
20  evidenced the transaction or the cable confirming the transaction, 
  could that be said to be in the nature of a fishing expedition? I 
  think not. These documents are manifestly the conduits through 
  which money may be transferred to the credit of an account and 
  the request for their production is at least analogous to the 
25  request for the letter in reply to correspondence, the existence of 
  which is either admitted or is not denied. 
      I am not persuaded that any of the members of the House of 
  Lords who made speeches in the Westinghouse case, had they 
  been discussing a case concerning bankers’ books, would have 
30  established a rule that a call for the books in which a banker in the 
  ordinary course of business accounted for a specific transaction, 
  would not be a call for particular documents. Accordingly, in my 
  view, a banker to whom an order was made to produce “all corre- 
  spondence, ledgers, day books and account books used in its 
35  ordinary course of business” in which it recorded the receipt of a 
  particular sum, on a particular day, which funds it credited to a 
  particular account, would be able to place his hands directly on 
  such records, and therefore to that extent such a description 
  would sufficiently satisfy the statutory requirement of “particular 
40  documents, etc.“ in s.2(4)(b). 
      But the amended request and the attendant summons con- 
1980–83 CILR 320

  tained certain words and phrases which Mr. Alberga submitted 
  were too wide, vague and of a fishing nature. These words of 
  request referred to “all other books, documents and papers” and 
  “including all records” relating to the particular accounts. It was 
5  clear from the whole tenor of the request that the US Govern- 
  ment was not seeking an oversight of all the accounting trans- 
  actions of the two entities named in the request. Their concern 
  was as to particular sums emanating from particular sources, 
  which were transmitted to the banks on particular dates in speci- 
10  fied forms and credited to particular accounts. Indeed, the sup- 
  porting evidence was that the returned cheques were in the 
  possession of the US Government. 
      Mr. Hill submitted that although the intention of the request 
  was manifest, if indeed the court was of the view that there was 
15  language therein which could be considered too wide, vague or of 
  a fishing character, which if allowed to stand could invalidate the 
  request, it was an appropriate case for the deletion of the offend- 
  ing words. Mr. Alberga, while supporting the principle that the 
  court in appropriate cases has power to sever one part of the 
20  request from the rest, submitted that in the instant case the docu- 
  ments requested were “classes of documents” and not “particular 
  documents” and since the blue pencil rule could only be applied 
  where it was possible to do so without the addition or alteration 
  of a word, or of re-writing the request, this was not a case in 
25  which the court could use the blue pencil. The gravamen of Mr. 
  Alberga’s submission was that the court could not use the blue 
  pencil in the instant case as it would be impossible by such a pro- 
  cedure to transform “classes of documents” into “particular 
  documents” and so bring them within the ambit of the relevant 
30  statutory provisions. 
      I need refer to no authority earlier than Rio Tinto Zinc Corp. v. 
  Westinghouse Elec. Corp. (3), for the proposition that the court 
  has an undoubted power to narrow down the ambit of the 
  request. Viscount Dilhorne expressed himself most strongly when 
35  he pointed out that this power of severance should be sparingly 
  resorted to and only in specific circumstances. In commenting on 
  the action taken by the Court of Appeal to salvage the request, he 
  said ([1978] 1 All E.R. at 453–454): 
          “In the Court of Appeal it was held that the words which 
40      so often appear in Sch. B ‘any memoranda, correspondence 
      - or other documents relating thereto’ were too wide and the 
1980–83 CILR 321

      words ‘relating thereto’ were struck out. In their place the 
      words ‘referred to therein’ were inserted. 
          That court thus recognised that a part of the letters was of 
      a fishing character. Letters of request may take a variety of 
5      forms. Some, it may clearly appear, are wholly directed to 
      the obtaining of evidence; some, it may equally clearly 
      appear are not; one part of a request may be for evidence 
      and the remainder not. The language of others may be such 
      that it is not possible with any degree of certainty to decide 
10      into which category they fall. 
          If it is clear that part of the request is for the obtaining of 
      evidence and that part is severable from the rest, it might be 
      right to hold that that part satisfies s.1 of the 1975 Act. If it is 
      clear that the request is substantially for the obtaining of evi- 
15      dence although a minor part is not, again it might be right to 
      hold that the barrier imposed by that section was passed. 
      The order made by the court could ignore the fishing part.” 
      As I have already indicated, I am of the view that the substan- 
  tial request was one for “particular documents” within the mean- 
20  ing of the Schedule to the Imperial Order. The words “all other 
  books, documents and papers” are too wide as they could lead to 
  a fishing expedition through the entire accounts of the subjects of 
  the request. I am also of the view that the words “including all 
  records” add nothing to the wide words “all other books, docu- 
25  ments and papers” but that they fall in the same category and are 
  likely to lead to a fishing expedition. These surplus words are 
  clearly severable from the remainder of the request. They form 
  but a minor part of that request and they ought to be deleted. 
  Upon their deletion the request remains grammatically agreeable 
30  and fully understandable without the necessity for the addition of 
  any words whatever. 
      I turn now to consider the question of the request for inspec- 
  tion of the relevant bankers’ books as contained in the amended 
  summons. There was no mention of a request for inspection in 
35  either the original or the amended letter of request. However, it 
  is undoubted law that the Grand Court has power on the appli- 
  cation of a party to legal proceedings, to order that such a party 
  be at liberty to inspect and take copies of any matter in a banker’s 
  books. This is so by virtue of s.8 of the Evidence Law, 1978 but 
40  such power to inspect is made subject, inter alia, to the Confiden- 
  tial Relationships Law. The reason for permitting inspection 
1980–83 CILR 322

  before trial is well set out in the judgment of Scrutton, L.J. in 
  Waterhouse v. Barker (7). There he said ([1924] 2 K.B, at 
  769–770): 
      “The power to inspect was given to any party, and there was 
5      no need for him to give notice to the other party unless the 
      judge ordered him to give such notice. It appears to me that 
      the primary object of the Act [Bankers’ Books Evidence Act 
      1879] was to amend the law of evidence as to proof of 
      matters recorded in bankers’ books, and incidentally to faci- 
10      litate proof by giving the person desiring to prove such trans- 
      actions a right to see the books in order to extract the 
      requisite evidence . . . I cannot think it was intended that 
      the trial must commence before he could inspect and get 
      copies, and that an adjournment must take place to enable 
15      him to get his evidence.” 
      This power of inspection is therefore ancillary to and facilita- 
  tive of the primary order for discovery. In answer to the conten- 
  tion that inspection could only be considered at all if it formed 
  part of the request, I would say that the provision in s.2(1) of the 
20  Schedule to the Imperial Order is wide enough to cover this ancil- 
  lary and supportive question. The Grand Court is by this section 
  expressly empowered to order appropriate procedures for giving 
  effect to the request which can include an order for “a person to 
  take appropriate steps.” If an order for inspection of a banker’s 
25  books has never been considered as an additional right of dis- 
  covery, but merely facilitative of it, why on principle should a 
  court preclude itself from the jurisdiction to make such an order 
  within the safeguards provided by the Evidence Law? 
      Attention must be directed to the fact that “discovery of docu- 
30  ments” under ss. 2 and 5 of the Schedule to the Imperial Order is 
  treated quite separately from “inspection of property.” Section 
  5(2)(c) did not seek to set out the procedure to be followed when 
  taking evidence from a witness orally or in writing, nor did it 
  place any limitation upon the common law position dealing with 
35  discovery of documents. Although discovery and inspection are 
  dealt with under separate sections of the Evidence Law, in their 
  interpretation the courts have treated inspection as the vehicle by 
  which the documents required for production in evidence through 
  discovery can be ascertained. 
40      In Arnott v. Hayes (1), Cotton, L.J. speaking of s.7 of the 
  Bankers’ Books Evidence Act 1879 said (36 Ch. D. at 737): 
1980–83 CILR 323

      “Then it enables copies of the entries to be given in evi- 
      dence. How can the suitor know what entries are wanted? 
      Only by examination of the books, and though this order 
      gives a wider power of inspection than a suitor had before, it 
5      is an inspection for the very purpose of the Act. It was 
      urged, and I was at first struck by the observation, that this is 
      making the Act give a power of discovery. But that is a fal- 
      lacy. This is not giving the Plaintiff discovery from the 
      Defendant to assist the Plaintiff’s case, but giving him a 
10      power of examination for the purpose of ascertaining what 
      copies he will require for the purpose of being put in evi- 
      dence.” [Emphasis supplied.] 
      Fry, L.J. was equally explicit as to the nature of inspection 
  under the Act. In his concurring judgment he said (ibid., at 739): 
15          “Then as to the general consideration of the Act, it is said 
      that this order gives the Plaintiff a discovery of documents 
      which he has no right to inspect. But this inspection is 
      necessary for the purposes of the Act. Before the Act it was 
      necessary to call the banker by a subpoena duces tecum, and 
20      the party could not see the books till they were put in. The 
      books are not now to be produced, but copies are to be used. 
      How are copies to be obtained? The party requiring them 
      cannot call on his adversary for copies; he therefore must 
      himself make a copy, and he must have liberty to look at the 
25      books for that purpose.” 
      Where the letters rogatory are in respect of criminal proceed- 
  ings, the court is not empowered to order the “inspection, photo- 
  graphing, preservation, custody or detention of any property.” 
  This is so by virtue of ss. 2(2)(c) and 5(1)(c) of the Schedule to the 
30  Imperial Order. However, “documents” are given specific and 
  peculiar treatment under the Schedule and are not to be included 
  in the general term “any property” in s.2(2)(c). The express 
  power which is given to the court by ss. 2(2)(b) and 5(1)(c) to 
  order the production of documents in criminal cases, in order to 
35  be effective, must include a power in the court to order inspection 
  prior to trial. In the instant case, special cause existed under s.7 of 
  the Evidence Law for the court to issue orders for the bankers to 
  produce their books and there was sufficient evidence before the 
  learned Chief Justice that the defendants named in the indictment 
40  control the companies in respect of whose accounts discovery was 
  sought. Had the learned trial judge construed the relevant statu- 
1980–83 CILR 324

  tory provisions as enabling him to make orders for the inspection 
  of the documents requested, I entertain no doubt that he would 
  have exercised his discretion to make the appropriate orders. 
      It is not the practice in the courts of the Cayman Islands to per- 
5  mit judicial proceedings to be videotaped; but at the same time 
  there is neither statutory prohibition nor judicial authority to the 
  contrary. We were referred to the practice in other jurisdictions 
  and to reported cases in which orders for videotaping of proceed- 
  ings before examiners were made. There is an Australian article 
10  on the topic—Video-tape trials, 48 Australian Law Journal at 338 
  (1974)—in which the author advocated five purposes for which 
  the Australian courts should make use of videotaped trials. These 
  included— 
      “ . . . to record evidence given abroad on commission, to be 
15      reviewed by the trial court in conjunction with the tran- 
      scripts of such evidence . . . . [The author continues:] 
      Ideally, it would of course be an advantage for an appellate 
      court to have available a videotape record of the trial under 
      appeal, in addition to the transcript of evidence contained in 
20      the appeal book.” 
      His Honour Judge Locke sitting in the County Court of the 
  Judicial District of York, Canada, in the case of the U.S. v. 
  General Elec. Co. (6) heard on November 19th, 1980, made an 
  order for the videotaping of evidence although no request there- 
25  for was contained in the letter of request. He held that the ques- 
  tion of videotaping was a matter of procedure and not one of 
  substantive law. After some hesitation, the Supreme Court of 
  Bermuda in proceedings with a similar genesis as the request in 
  the instant case ordered that the proceedings before an examiner 
30  in that country be videotaped. 
      In s.2(3) of the Imperial Order it is provided that: 
          “An order under this section shall not require any particu- 
      - lar steps to be taken unless they are steps which can be 
      required to be taken by way of obtaining evidence for the 
35      purposes of civil proceedings in the court making the order 
      (whether or not proceedings of the same description as those 
      to which the application for the order relates); but this sub- 
      section shall not preclude the making of an order requiring a 
      person to give testimony (either orally or in writing) other- 
40      wise than on oath where this is asked for by the requesting 
      court.” 
1980–83 CILR 325

      Order 70, r.4 amplifies the procedure for the examination of 
  witnesses by providing that subject to the question of privilege 
  the examination shall be taken in manner provided by O.39, rr. 
  5–10 and 11 (1)–(3). In 17 Halsbury’s Laws of England, 4th ed., 
5  para. 329, footnote 6, at 229 in commenting upon the above statu- 
  tory and regulatory provisions, the learned authors say that the 
  examination is to be taken as in the case of an ordinary examin- 
  ation out of court: 
      “I.e. in the manner provided by RSC Ord. 39, rr. 5–10, 11 
10      (1)–(3) . . . which apply with the necessary modifica- 
      tions . . . . The rules of evidence applicable in the foreign 
      court should be applied where they are known and, even 
      where they are not known, the strict rules of the English law 
      of evidence should be relaxed so as to admit whatever ques- 
15      tions may be reasonably expected to throw light on the 
      matter in issue . . . .” 
      As I said earlier, there is no statute either permitting or inhibit- 
  ing the Grand Court from ordering that the examination of the 
  witnesses be videotaped. Both the original and the amended 
20  letter of request contained an application that the proceedings be 
  videotaped. When one considers that it is permissible to relax the 
  strict rules of evidence applicable in an English court in an exam- 
  ination conducted as a result of an order made on a letter of 
  request expressly to assist the foreign court, is there any principle 
25  which would prohibit the videotaping of the proceedings at the 
  request of the foreign court where that is the precise form of 
  assistance which that court needs? During argument the court 
  was informed by counsel that without the videotapes the evidence 
  taken on an examination would be worthless in the US court. The 
30  advantages of videotaping were conceded in argument, that is to 
  say, videotapes bring the witnesses to life and show their demean- 
  our to the tribunal which eventually has the responsibility to 
  determine questions of fact. 
      I am of the view that videotaping as requested is a matter of . 
35  procedure and as this procedure is not expressly prohibited by 
  any of the provisions of the Imperial Order it was open to the 
  judge of the Grand Court who has power to regulate the proceed- 
  ings of his court, to make an order for the proceedings to be 
  videotaped. When the hearing before the examiner subsequently 
40  takes place, a witness is privileged to object to being videotaped 
  if, in his opinion having regard to his particular circumstances, 
1980–83 CILR 326

  the videotaping of his evidence would expose him to danger to 
  life or liberty. It would then be for the examiner to rule on the 
  substantive objection. I am of the view that the learned Chief Jus- 
  tice adopted too narrow a construction of the requisite statutory 
5  provisions referred to by him in his judgment and was in error 
  when he concluded that he had no jurisdiction to order videotap- 
  ing. 
      The final question with which I propose to deal on this appeal 
  concerns the witness Challice. He had left the jurisdiction of the 
10  Cayman Islands after the hearing of the original application on 
  March 19th, 1982. The allegation then was that he had relevant 
  information touching the request. Considerations peculiar to 
  bankers which form the subject-matter of ss. 7 and 8 of the Evi- 
  dence Act do not apply to Mr. Challice, an employee of the bank, 
15  who was required to give evidence in his personal capacity. The 
  information which was required of Mr. Challice fell within the 
  provisions of the Confidential Relationships Law and he was 
  bound to comply with its provisions. Section 3A(1) of the Order 
  has extra-territorial effect. The Grand Court of the Cayman 
20  Islands has jurisdiction to try a person of any nationality who, 
  being possessed of confidential information within the meaning of 
  that statute, discloses that information anywhere in the world 
  without the prior permission and under the stipulations of the 
  Grand Court. It is immaterial that Mr. Challice, who continued 
25  to be an employee of Barclays Bank International, had left Cay- 
  man before the Grand Court handed down its decision. If an 
  order was made by the court he could elect to obey it. A court 
  with jurisdiction to make an order does not contemplate that the 
  person to whom that order is issued will refuse to obey. If Mr. 
30  Challice chose to disobey the order he would be in contempt of 
  court with all its consequences should he ever set foot again on 
  Cayman territory. The order sought in respect of Mr. Challice in 
  the form amended on appeal ought to issue. 
      For these reasons I concurred in the decision which was handed 
35  down on June 4th, that the appeal should be allowed and con- 
  curred in the order proposed by the learned Acting President. 
    
      WHITE, J.A. concurred. 
    
40      KERR, Ag. P.: Rowe, J.A. has expressed fully and with careful 
  lucidity his reasons for concurring in the order which we made on 
1980–83 CILR 327

  June 4th. I am in agreement with his reasons and his conclusions. 
  For completion I append hereto the form of the order made in 
  disposition of the appeal. 
      “IT IS HEREBY ORDERED that David Challice of Barclays 
5      Bank International Limited, Grand Cayman; Edwin Gil- 
      mour of Barclays Bank International Limited, Grand Cay- 
      man; Cyrus Regnart of Bank of Nova Scotia, Grand 
      Cayman; W. Bayko and/or Tony Connolly of Bank of Nova 
      Scotia, Grand Cayman do attend before the Honourable 
10      Gerard D. Reilly, who is hereby appointed Commissioner, 
      on Monday, the 5th day of July 1982, at 10:00 o’clock in the 
      forenoon, at the Board Room of the offices of Messrs. A. 
      Steve McField and Associates, George Town, Grand Cay- 
      man, or such other day and time as the said Commissioner 
15      may appoint, and do there submit to be examined upon oath 
      or affirmation, touching the testimony so required and relat- 
      ing to the matters set forth in the LETTERS OF REQUEST for 
      International Judicial Assistance of the United States Court 
      for the District of Columbia, and in the affidavit of John D. 
20      Arterberry, attached to the affidavit of A. Steve McField 
      filed herein and marked as Exhibit ASM I. 
          And, special cause being shown, namely that an Order is 
      necessary in order to give effect to the Request of the United 
      States District Court for the District of Columbia, IT IS 
25      FURTHER ORDERED— 
          (i) that David Challice do appear and give evidence on all 
      matters related to the receipt and disposition of the sum of 
      $294,000 which funds were credited to the account or 
      accounts of International Resource Management Consul- 
30      tants at Barclays Bank International Limited, Grand Cay- 
      man by means of wire transfer of $200,000 on or about June 
      27th, 1977 and two checks ($44,000 and $50,000) payable to 
      Heidi Carver and deposited to the said account or accounts 
      on or about November 4th, 1977; 
35          (ii) that Edwin Gilmour, the proper officer of Barclays 
      International Limited, Grand Cayman, as custodian of 
      records do produce all correspondence, ledgers, day books, 
      account books, used in the ordinary course of business relat- 
      ing to the account or accounts held by International 
40      Resource Management Consultants, relating to the receipt 
      of $294,000 which funds were credited to the account or 
1980–83 CILR 328

      accounts by means of a wire transfer of $200,000 on or about 
      June 27th, 1977, and two checks ($44,000 and $50,000) pay- 
      able to Heidi Carver and deposited into the account or 
      accounts on or about November 4th, 1977 and of the sub- 
5      sequent disposition of the said funds, and that the said 
      Edwin Gilmour of Barclays Bank International Limited do 
      appear to prove the relevant matters, transactions and 
      accounts recorded in their records; 
          (iii) that Cyrus Regnart of Bank of Nova Scotia, Grand 
10      Cayman do produce all correspondence, ledgers, day books, 
      account books used in the ordinary course of business relat- 
      ing to the account or accounts held by Redcon Limited relat- 
      ing to the receipt of $500,000 which funds were credited to 
      the account or accounts by means of three checks ($300,000; 
15      $100,000 and $100,000) payable to Redcon and deposited 
      into the account or accounts on or about November 8th, 
      1977 and the subsequent disposition of the said funds, and 
      that the said Cyrus Regnart of Bank of Nova Scotia do 
      appear to prove the relevant matters, transactions and 
20      accounts recorded in their records; 
          (iv) that Tony Connolly and/or W. Bayko, the proper offi- 
      cers of the Bank of Nova Scotia as custodian of records, do 
      produce all correspondence, ledgers, day books, account 
      books used in the ordinary course of business relating to the 
25      account or accounts held by Redcon Limited relating to the 
      receipt of $500,000 which funds were credited to the account 
      or accounts by means of three checks ($300,000; $100,000 
      and $100,000) payable to Redcon and deposited into the 
      account or accounts on or about November 8th, 1977 and 
30      the subsequent disposition of the said funds, and that the 
      said Tony Connolly and/or W. Bayko of Bank of Nova Sco- 
      tia do appear to prove the relevant matters, transactions and 
      accounts recorded in their records. 
          AND IT IS FURTHER ORDERED that the said witnesses do 
35      apply to the Grand Court pursuant to s.3A of the Confiden- 
      tial Relationships (Preservation) Law for directions as to 
      manner of giving evidence and the production and inspec- 
      tion of the said documents within seven days of the service of 
      the said order herein. 
40          AND IT IS FURTHER ORDERED that John D. Arterberry, 
      Attorney, United States Department of Justice, or any other 
1980–83 CILR 329

      lawful representative of the United States Department of 
      Justice, or any other lawful representative of the United 
      States of America, is hereby authorized to inspect and take 
      copies of the said documents to be produced by the said wit- 
5      nesses herein. 
          AND IT IS FURTHER ORDERED, in accordance with the 
      Request of Her Honour Judge Norma Holloway Johnson, 
      contained in the Request for International Judicial Assist- 
      ance, that a verbatim stenographic recording be made of the 
10      said evidence and that the proceedings in respect thereof be 
      videotaped by means of videotape recording to be supplied 
      by the authorities of the United States of America. 
          AND IT IS FURTHER ORDERED that the said videotape 
      recordings be neither edited nor copied, without leave of 
15      Her Honour Judge Norma Holloway Johnson, or such other 
      judicial authority as may be appropriate in the said United 
      States of America. 
          AND IT IS FURTHER ORDERED, in accordance with the said 
      Request of Her Honour Judge Norma Holloway Johnson, 
20      that the taking of said evidence be governed by the Federal 
      Rules of Evidence and Procedure, save that any of the said 
      witnesses may refuse to answer any question tending to cri- 
      minate himself, AND FURTHER, that all evidentiary objec- 
      tions under the laws of the United States of America shall be 
25      noted and preserved for the trial court as provided in Rule 
      30(c) of the Federal Rules of Civil Procedure. 
          AND IT IS FURTHER ORDERED that after the evidence has 
      been transcribed and recorded as aforesaid, it be filed in the 
      Registry of the Grand Court and that the Clerk of the Grand 
30      Court do forward the said transcripts, exhibits and videotape 
      recordings, together with a copy of this Order to the United 
      States District Court for the District of Columbia, in accord- 
      ance with the Grand Court (Foreign Process) Rules, 1977. 
          AND FURTHER, that this order be served on the said wit- 
35      nesses and the Attorney General of the Cayman Islands.” 
    
  Appeal allowed.