By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A Bahamian attorney yesterday successfully overturned a verdict ordering she repay $70,000 provided by her late former parents’ in-law to prevent her being jailed for stealing client funds.

The Court of Appeal, in a unanimous September 9, 2025, decision agreed with the arguments advanced by Sonia Timothy-Serrette and her attorney, ex-MP Keod Smith, and set aside “In its entirety” the previous Supreme Court ruling that found the payment was a “soft loan” she was obligated to repay to her former in-laws within two years.

The events behind yesterday’s verdict, which saw the Court of Appeal blast the dispute’s handling by the Supreme Court and Justice Cheryl Grant-Thompson as “a colossal waste of judicial time” (see other article on Page 1B), dated from 2009 when Ms Timothy-Serrette was charged with stealing $96,968 from retired teacher Fiordelisa Bain, who attended the same church.

The Tribune’s records from the time record how Ms Timothy-Serrette was given one month by then-deputy chief magistrate Carolita Bethell to repay the monies to her client otherwise she would be sentenced to a two-year prison term. To raise the funds, which she did not have, she “coerced” her former in-laws to sell property they owned at Yamacraw to Sir Franklyn Wilson’s Arawak Homes.

Stephen Serrette senior and Bessie Serrette, both of whom have now passed and were represented before the Court of Appeal by their respective estates, asserted in their original claim filed in 2015 that they sold the Yamacraw Beach Estates property at a 33 percent discount to its appraised value due to the urgency with which their then-daughter-in-law needed funds - costing them $35,000.

“The defendant had two matters before the courts as it related to monies owed to her clients,” the couple alleged, one of which involved “allegedly misappropriating” monies from a bishop whose name was blanked out by the Court of Appeal. 

“With respect to both matters, the defendant pleaded with the plaintiffs to financially assist her in acquiring a substantial sum of money as she maintained that the courts were willing to consider a Compensation Order dependent on the complainant’s acceptance,” the Serrettes alleged.

They added that their daughter-in-law knew they owned the Yamacraw Beach Estates property, and urged them to “sell the land and loan her the proceeds of the sale” with a promise “she would repay the loan within two calendar years”. Based on this, the Serrettes obtained an appraisal from Bishop Walter Hanchell, who valued it at $105,000.

“The defendant insisted that the said funds were imperative and, as such, pressed the plaintiffs to accept a lower offer of $70,000 made by Harmony Homes Ltd,” the couple alleged, referring to an Arawak Homes affiliate.

“As a result, the plaintiffs conveyed the said property to Harmony Homes Ltd on or about the 30th day of June 2010 for the said amount. The plaintiffs were coerced into selling their said property at an undervalued price and, as a result, suffered an additional loss in the amount of $35,000.” The sales proceeds were paid direct to Ms Timothy-Serrette but the move did not produce family harmony.

The Serrettes alleged that their daughter-in-law failed to repay the money and subsequently divorced their son, Stephen Jnr, on March 25, 2013. This sparked their Supreme Court action, where they sought damages and costs, eventually obtaining a favourable verdict from Justice Grant Thompson on September 30, 2022 - almost eight-and-a-half years after the claim was filed on April 7, 2014.

Justice Grant-Thompson said she was “satisfied” that the $70,000 represented a ‘soft loan, adding that Stephen Serrette senior had “made it clear that he loved his son and daughter-in-law and would do what he could to avoid distress and shame to his family.

“I found his evidence to be credible both by his words and his demeanour. I accept that he liquidated his property in order to realise cash proceeds which he could make available to his daughter-in-law in order to satisfy the outstanding debt which she had to avoid her being incarcerated,” Justice Grant-Thompson added.

Ms Timothy-Serrette said there was no evidence of a binding loan agreement between the two parties, but the judge backed the undervalued sale and payment of the proceeds to her on the same day as the conveyance was executed as signalling “the existence of an agreement”.

“The fact that the transaction closed on April 20, 2010, and the cheque was issued on the same date supported the plaintiffs’ case that there was some urgency which required matters to move quickly,” Justice Grant-Thompson ruled. 

“The court takes judicial note of the defendant’s well-publicised cases of misappropriation of clients’ funds and of her incarceration, which supports the plaintiffs’ pleaded case.” 

Ms Timothy-Serrette, though, moved to overturn the Supreme Court verdict on the basis that there was ““no evidence of a loan” and that he former parents-in-law “did not prove” the existence of a contractual loan arrangement between them.

Mr Smith, acting as her legal representative, asserted that the case against his client was “an action for repayment of a debt based on a verbal arrangement between the parties”. He added that the Supreme Court’s findings that a loan agreement were “clearly erroneous” because there was no signed written agreement as required by the Statute of Frauds (Bahamas) Act.

This stipulates that words, or a verbal agreement alone, are insufficient evidence in the Bahamian judicial system to prove a loan agreement exists. Travette Pyfrom, representing the Serrettes’ estate, argued that there was sufficient evidence to show the $70,000 was not a gift but a loan to enable Ms Timothy-Serrette to avoid jail - especially the fact that the funds were paid on the same day as the conveyance.

But the Court of Appeal, agreeing with Mr Smith, ruled: “We are satisfied that, in this particular case, the learned judge’s findings as to the existence of a loan are plainly erroneous as a matter of law... The claim against the appellant for breach of contract was clearly based on an oral agreement.”

It added that the absence of a written agreement, confirming that the $70,000 was a loan and due to be repaid, was “fatal” to the claim under the Statute of Frauds (Bahamas) Act. As a result, the Court of Appeal found for Ms Timothy-Serrette and reversed the Supreme Court ruling.