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Court of Appeal of Fiji |
IN THE COURT OF APPEAL
ON APPEAL FROM THE HIGH COURT
CIVIL APPEAL NO. ABU 0035 of 2011
(High Court of Fji HBC No. 247 of 2010L)
BETWEEN:
KHAN BUSES LTD
Appellant
AND:
JANARDHAN
Respondent
Coram : Calanchini P
Basnayake JA
Corea JA
Counsel : Mr. N. Nand for the Appellant
Mr. R. W. Pillay for the Respondent
Date of Hearing : 22 November 2013
Date of Judgment : 05 December 2013
JUDGMENT
Calanchini P:
[1] I agree that the appeal should be dismissed with costs in the sum of $5000.00 to be paid to the Respondent.
Basnayake JA:
[2] This is an appeal filed by the appellant (plaintiff) inter alia to have the judgment dated 24 June 2011 of the learned High Court Judge at Lautoka set aside. By this judgment the learned Judge had ordered to strike out the plaintiff's originating summons and dismissed the action with costs. In the same appeal the plaintiff seeks to set aside another interlocutory judgment of the learned High Court Judge dated 24 May 2011. By this order the learned Judge had dissolved an interim injunction issued against the respondent (defendant) restraining the defendant from presenting, advertising or publishing a winding up petition.
[3] The learned counsel for the defendant submitted that the order dated 24 May 2011 being an interlocutory order, the plaintiff should have first obtained leave. Considering the complexity involved in this case, the court acting under Section 12 (2) (f) of the Court of Appeal Act Cap. 12 decided to grant leave.
[4] The defendant had been the registered owner of Crown lease No. 7893 with an extent of 9 acres and 07 perches. This lease was issued to the defendant in 1980 for a period of 15 years (pg. 280 of the Record of the High Court (RHC)) and was subsequently extended for another period of 20 years.
[5] On 11 September 1995 one Mohammed Nasir Khan, a director of the plaintiff's company, had entered into a sale and purchase agreement (hereinafter referred to as the contract) with the defendant to purchase the land of 9 acres and 07 perches (described in the schedule) for a sum of $170,000. Out of this amount a sum of $5000 was deposited at the execution of the contract and the balance sum of $165,000 was agreed to be paid on the date fixed for the settlement, that was 8 December, 1995. Khan assigned his rights to the plaintiff on a later date.
[6] According to the contract, in the event of default of payment by the purchaser (plaintiff) the defendant (vendor) had the right to terminate the contract and to recover the loss. In the event of default by the defendant, the purchaser (plaintiff) was able to move for specific performance and also to claim for special and general damages.
[7] The defendant rescinded the contract and sued the plaintiff in the High Court in case No. 358 of 2004L. The High Court on 7 November 2005 gave judgment in favour of the defendant. In that the defendant was allowed to retain the sum of $94,300 paid by then by the plaintiff and the deposit of $5000.
[8] The Court of Appeal on 7 November 2008 in the Civil Appeal No. ABU 0122 of 2005 S, set aside the judgment of the High Court, dated 7 November 2005. By this judgment the Court of Appeal ordered the defendant to bring about a settlement within a period of 90 days. The Court of Appeal also ordered the plaintiff to pay the defendant a sum of $70,700 and compound interest at 10% per annum until the date of settlement. The Supreme Court on 27 August 2010 dismissed the defendant's petition for special leave.
[9] After delivery of the Supreme Court Judgment the defendant made several attempts to bring about a settlement with no success (Pgs. 107, 111, 112 to 147 of the RHC). The defendant claimed that the plaintiff refused to pay the balance purchase price and the compound interest. The defendant thereafter instituted proceedings for the winding up of the plaintiff's company. The winding up notice was served on the plaintiff on 10 December 2010 returnable on 31 December 2010.
[10] On 31 December 2010 the plaintiff filed the present action in the High Court of Lautoka by originating summons together with the supporting affidavits and (pgs. 24 and 164 of the RHC) obtained an interim injunction against the advertising etc., of the winding up petition by the defendant (pgs 165-166). The defendant on 28 January 2011 filed an affidavit in opposition and moved to strike out the plaintiff's originating summons (pgs 169-296 of the RHC).
The Plaintiff's Summons
[11] The plaintiff sought the following orders in the originating summons filed on 31 December 2010, namely:
The 3rd and the 4th claims are not reproduced as they are not relevant.
[12] In a lengthy affidavit the plaintiff disclosed the following facts, namely:-
The Court of Appeal on 7 November 2008 set aside the High Court Judgment.
[13] The plaintiff filed this action on the basis that the plaintiff does not owe any debt to the defendant. The plaintiff claims that he became the registered proprietor of the land which was leased to the defendant previously by virtue of permit issued by the Director of Lands on 4 May 2009 (pg. 180 RHC). On 25 August 2009 (pg. 179 RHC) an eviction notice was issued on behalf of the plaintiff directing the defendant to vacate the land prior to 24 August 2009. The defendant had replied to this letter on 8 September 2009 (pg. 186). The plaintiff again wrote to the defendant on 9 September 2009 (pg. 188) stating that the new lease has no bearing on the contract which is the subject matter of the litigation in the Supreme Court. Eventually the defendant had sought redress from the Supreme Court (An order of stay made on 19 January 2009 which was confirmed by the Supreme Court Ruling on 3 December 2009 at pg. 310) preventing the plaintiff from using the new lease to evict the defendant until the final disposal of the case.
The Supreme Court Judgment
[14] The appeal filed in the Supreme Court was heard on 9 August 2010. The Supreme Court referred to the Court of Appeal judgment dated 7 November 2008 (pg. 216 at 218) as follows:-
"The Court of Appeal also ordered Khan and his company (plaintiff) to pay Janardhan (defendant) compound interest on the balance of the purchase price at the rate of 10% from 8 December 1995, the date of settlement under the Contract, until the date of actual settlement".
The Supreme Court had also observed the Ruling of the Chief Justice dated 3 December 2009 (pg 310). The Supreme Court made reference to the new lease executed in favour of the plaintiff on 4 May 2009. The Supreme Court confirming the Judgment of the Court of Appeal held that "compound interest ran from 8 December 1995 continuously throughout and does not stop until the contract is actually settled, which seems to be, for all practical purposes, the actual date the Respondents (plaintiff) actually pay the petitioner (defendant). (emphasis added).
[15] The plaintiff never raised an argument that the debt was wiped off with the issuance of the new lease. The debt was confirmed by the Court of Appeal as well as the Supreme Court. The entire proceedings revolved around the debt not having been settled by the plaintiff since 1995. All these orders now confirmed the plaintiff's obligation to settle the balance payment together with interest at 10% from 8 December 1995 until payment in full. The plaintiff by filing this present action is seeking to litigate again on the same issue that both parties have been litigating from 2004. This litigation ended with the Supreme Court judgment pronounced on 27 August 2010. The plaintiff is seeking a declaration from the High court that the debt is not payable or in the alternative that the debt is disputed when the debt had been confirmed and all disputes with regard to the debt has been resolved.
The Judgment
[16] The learned Judge stated that (quoting from his interlocutory order dated 24 May 2011 which dissolved the interim injunction issued in favour of Khan Busses) the originating summons rested on one main point. "Its counsel argued that because Janardhan could not deliver title, because it is now held by her client, Janardhan was not in a position to settle, therefore he could not specifically perform the sale and purchase agreement. Because Janardhan could not perform the agreement, he was therefore not entitled to any payment and it followed that no debt was owed by Khan Buses (plaintiff) to ground the statutory demand against the company".
[17] The learned Judge stated that "the argument totally ignores the reality of the situation. Khan Buses sought specific performance of the agreement for Janardhan to sell the land in question to it. The Court of Appeal granted what it wanted. Khan Buses, by some "dubious means" got itself registered as the lessee of the very same land. It got exactly what it wanted. I do not think that Khan busses can avoid paying for what it wanted and the Court of Appeal granted on 7 November 2008".
[18] He stated that this application (to strike out the originating summons) was made pursuant to Order 18 Rule 18 of the High Court Rules 1988 on the grounds that the plaintiff's claim discloses no reasonable cause of action is frivolous, vexatious and scandalous and is an abuse of process.
[19] According to these rules the court may strike out a statement of case if it appears to the court that:
(a) It discloses no reasonable cause of action or defence, as the case may be; or
(b) It is scandalous, frivolous or vexatious; or
(c) It may prejudice, embarrass or delay the fair trial of the action; or
(d) It is otherwise an abuse of the process of the courts;
and may order the action to be stayed or dismissed or judgment to be entered accordingly, as the case may be.
[20] Considering the question whether the debt had been genuinely disputed the learned Judge again quoted from his judgment dated 24 May 2011 that "the Court of Appeal on 7 November 2008 ordered Janardhan "to take all necessary steps required of him to bring about a settlement of the sale and purchase agreement of 11 September 1995, such settlement to take place within 90 days of the date of the handing down of this judgment". The Court of Appeal also ordered Khan Buses to pay Janardhan "compound interest at the rate of 10% per annum on the sum of $70,700 from 8 December 1995 until the date of settlement of the sale and purchase agreement dated 11 September 1995". That judgment was not disturbed on appeal to the Supreme Court. Whilst these court proceedings were on foot, Khan Buses made it impossible for Janardhan to perform the agreement by having itself registered as the registered proprietor...".
[21] The learned Judge referred to these proceedings as nothing more than an attempt to drag the matter through the courts again to delay and avoid payment of the purchase price. This litigation must come to an end (Reserve Bank of Fiji v Gallagher [2006] FJCA 37 where Lord Bingham was quoted in Johnson v Gore Woods & Co (2001) 1 All ER 481 at 498-9).
Submissions of the learned Counsel for the Plaintiff
[22] The learned counsel crystallized the grounds of appeal in to two grounds, namely:
The learned counsel submitted that:
[23] With regard to the question of striking out, the learned counsel relied on the judgment of Kirby J in London v Commonwealth [No. 2] [1996] HCA 14; 70 ALJR 541 at 544-5 quoted by Prakash J in Ratumaiyale v Native Land Trust Board & Pacific Octopus Ltd [2000] 1 FLR 3.
[24] The whole of the submission of the learned counsel appears to rest on the issuance of a lease by the Director of Lands to the plaintiff. The learned counsel submitted that this frustrated the performance of the Court of Appeal Judgment. The defendant was not able to perform the sale at the time the notice of winding up was issued, namely, on 10 December 2010. The plaintiff became the owner of this land by virtue of the new lease issued on 4 May 2009. Therefore the learned counsel submitted that the filing of the winding up application was an abuse of the process of court. The learned counsel further submitted that the only way the plaintiff could obtain an injunction to prevent the publication of the winding up petition was by filing an originating summons.
The Submissions of the learned Counsel for the Defendant
[25] The learned counsel for the defendant submitted that the plaintiff has not pleaded a cause of action at all and has abused the process of court by filing a frivolous, vexatious and scandalous action.
[26] From the time of signing the contract the plaintiff had made 39 payments, the last payment being on 2 July 2004 totaling $94,300. In all, the plaintiff had paid $99,300 ($5000 paid as deposit). When the defendant was about to file action in 2004, the plaintiff had offered to pay the total balance on 12 October 2004 which the defendant had refused to accept. Thereafter the plaintiff had filed a counterclaim and moved for specific performance. The Court of Appeal on 7 November 2008 ordered the plaintiff to pay the balance together with interest at 10% up to the final payment. The Supreme Court on 27 August 2010 confirmed the Court of Appeal Judgment. The Supreme Court had observed the new lease issued to the plaintiff in the judgment. However the Supreme Court reiterated the obligation of the plaintiff to make the balance payment together with interest ordered by the Court of Appeal.
[27] The courts have finally resolved the dispute between the plaintiff and the defendant which has been spanning for more than fifteen years (from 1995). The whole dispute relates to a debt. This has now been resolved. There cannot be any more disputes over this debt now. The plaintiff by filing this action is seeking court to inquire in to this debt over and over again.
[28] I am of the view that the learned Judge was correct in holding that the originating summons does not disclose a cause of action and striking the same and dismissing it. Hence I find no merit in this appeal and is dismissed with costs fixed at $5000.
Corea JA:
[29] I agree with the reasons and conclusions of Basnayake JA.
[30] The Orders of the Court are:
........................................
Hon. Justice W. D. Calanchini
President, Fiji Court of Appeal
.........................................
Hon. Justice Eric L. Basnayake
Justice of Appeal
..........................................
Hon. Justice Mayadunee Corea
Justice of Appeal
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URL: http://www.paclii.org/fj/cases/FJCA/2013/130.html