Payment for devaluation: caribbean judgments in foreign currency

• Author: Winston Anderson
• Position: PhD (Cantab); Attorney and Parristet-ar-I-aw
• Pages: 24-36

PAYMENT

FOR

DEVALUATION:

CARIBBEAN

JUDGMENTS

IN

FOREIGN

CURRENCY

WINSTON

ANDERSON*

I.

Introduction

Foreign

currency

litigation

is

traditionally

associated

with

offences

committed

by

persons

who

attempt

to

leave

Caribbean

jurisdictions

with

large

quantities

of

local

or

foreign

currency

but

without

the

appropriate

clearance

from

the

central

b

ank

or

other

regulatory

authority

.

1

However,

the

mercurial

volatility

in

the

foreign

exchange

rates

of

some

Caribbean

currencies

has

begun

to

make

its

presence

felt

in

an

emerging

body

of

private

international

law

cases.

These

cases

suggest

that

instability

in

the

value

of

the

local

currency

has

important

implications

for

commercial

type

litigation

in

transnational

transactions.

In

truth,

volatility

and

‘

instability

’

are

accurate

but

inadequate

descriptions

of

the

changes

that

have

taken

place

in

some

Caribbean

currencies.

Guyana,

Jamaica,

and

Trinidad

and

Tobago

have

been

plagued

with

currency

changes

but

only

in

one

direction,

i

.

e,

steep

decline

in

the

value

of

the

dollar

against

virtually

all

other

currencies.

Devaluation

of

the

Guyana

dollar

has

been

particularly

dramatic

.

2

That

decline

in

social

and

economic

conditions

is

well

documented

in

the

literature

on

Caribbean

economics

.

3

What

the

private

international

law

cases

*

PhD

(

C

antab);

Attorney

and

Barrister-at

-L

aw;

Genera!

Counsel

to

CARICOM;

Senior

Lecturer

in

Law,

University

of

the

West

Indies

with

special

interest

in

International

Law

(Private

and

Public),

Environmental

Law

(International

and

Caribbean)

and

Commercial

Law.

1.

See

e.g,

M

aragh

v.

Comptroller

of

Customs

and

the

Attorney

General,

Unreported,

Supreme

Court

of

Barbados,

No.

760

of

1991,

March

17,

1994.

2.

In

1981

there

was

a

fixed

rate

of

Guyana

$3

to

US

$1;

by

1990

the

currency

had

been

devalued

to

Guyana

$65

to

US

S

1

;

the

situation

worsened

by

a

decision

in

September

1991

to

allow

the

currency

to

float

so

that

by

1993

it

hovered

around

Guyana

$125

to

US

$1;

today

it

is

about

Guyana

$185

to

US

S

1

.

3.

See

eg,

Karl

Bennett,

“

Exchange

Rare

Policy

and

External

Imbalances:

The

Jamaican

Experience

”

Social

and

Economic

Studies,

Vol.

32

No

.

4

December

1983,

5

1

;

Michael

Witter,

Exchange

Rate

Policy

in

Jamaica:

A

Critical

Assessment

,

”

Social

and

Economic

Studies,

Vol.

32

No.

4

December

1983,

1.