Defendant
Counsel: Mr C. Young for Plaintiffs
Mr W. Clarke for Defendant
Hearing: 26th April 2000
Decision: 3rd May 2000
DECISION
This is the Plaintiffs’ application to restrain the Defendant from disconnecting electricity supply to their home on the W Island.
The Plaintiffs ares are the proprietors of CT 26710 and 26711, property containing a house called “Lewadua.” The Defendant Company
owns the Wakaya Island Resort, which owns electricity supply on the Wakaya Island.
The Plaintiffs’ writ of summons states that from 1990 when “Lewadua” was built by the previous owner, Seni Establnt, electricity was
suppliepplied to the house by the Defendant through cables running from the resort to the house. The laying of the cables was paid
for by Seni Establishment.
The Plaintiffs say that the understanding was that the electricity would continue to be supplied to the home, and that the supply
of electricity was one of the reasons that they bought the home.
The Plaintiffs bought the property in Octob96 from Seni Establishment. Between 1996 and 1998 the Plaintiffs and the Defendant had
a se a series of discussions and entered into some correspondence, about the possibility of “Lewadua” being available for private
renting by guests of the resort.
By January 2000, it became apparent that the Plaintiffs and the Defendant would not be to reach an agreement about the rental arrangements.
On 9tOn 9th February 2000 the Plaintiffs were informed by the Defendant, that electricity supply could no longer be supplied to the
house, and that the Plaintiffs should, within the next 75 days, build their own generator.
There was some correspondence between the parties about theding of the generator. It appears that the Defendant Company assisted in
obtaining quotatiotations for the Plaintiff.
However, the Plaintiffs filed the writ of summons on 19th April 2000 and applied for this ction. On the date of the hearing of this
injunction, the ethe electricity supply had not been disconnected, although the seventy five day period had expired.
The Plaintiffs relied on the affidavit of Devanesrma, annexing the affidavit of the first Plaintiff. The Defendant filed the affidavits
of R of Robert Miller and Dong Carlson, both employees of the Defendant Company.
The Plaintiffs claim that the Defendant is estopped by conduct from now disconnecting the electricity, or that the Defendant fraudulently
misrepresented to the Plaintiffs that electricity would be continuously supplied to “Lewadua”.
p class=MsoNormal stal style="margin-top: 1; margin-bottom: 1"> The Plaintiffs also claim that the Defendant is in breach of section 33(1) of the Fair Trading Decree, section 54 of the Fair Trading
Decree and of section 43(2) of the Fair Trading Decree.
The principles governing the grant or refusal of an interlocutory injunction are well-settled since American Cynamid -v- Ethicon.
The court must first consider whether there is a serious question to be tried. Secondly, the court consider whether the plaintiff
could be adequately compenompensated in damages if the injunction were to be refused. If damages are not an adequate remedy, the
balance of convenience and justice of the situation must then be considered.
Counsel for the Plaintiffs submitted that even where the plaintiffs failed the tests in American >Cynamid (supra) an injunction should still be gran granted where the Defendant had acted in clear breach of a legal duty, or in some way
which could be seen to be a deliberate or reckless disregard of the Plaintiff’s rights. He relied in particular on the decision of
the English Court of Appeal in Shelfer -v- City of London Electric Lighting Co. [1894] UKLawRpCh 212; (1895) 1 Ch 287 and the New Zealand Court of Appal decision in New Zealand Milk Corporation -v- McDonald (1993) 2 NZLR 543.
ass=MsoNormal stal style="m-top: 1; margin-bottom: 1"> Counsel also referred to the court’s power to r to grant injunctions under the Fair Tradecree to prevent breaches or continued breaches
of the Decr Decree.
On a reading of the affidavit evidence before me, I am satisfied that the plaintiff has shown that there was a form of agreement or
licence between the parties as to the supply of electricity to “Lewadua”. Although the Sale and Purchase Agreement (to which the
Defendant was not a party) is silent on the supply of electricity, it is clear that since the construction of the house, and of cables
for electricity supply, that the Plaintiffs and the Defendant had an agreement that electricity would be supplied by the resort and
paid for by the proprietors of the house.
Although the Defendant Company did not make the representations contained in Annexure BLR1 to the affidavit of Barry Lee Rosenblatt,
it nevertheless continued to supply electricity to the house without informing the Plaintiffs in writing that the supply was temporary.
I am therefore satisfied that the conduct of the Defendant sug that a form of agreement as to the supply of electricity did exist
between the parties, ans, and that the question of the termination of that agreement will be a matter for the trial court. For the
purpose of this application I am satisfied that there is a serious question to be tried.
Furthermore, I am satisfied that the Plaintiffs shown that there are possible breaches by the Defendant of the Fair Trading Decree
1992. Th2. The Decree was designed “..... to promote the interests of consumers and the effective and efficient development of industry
trade and commerce through the encouragement of fair competition and to prevent the unfair or undesirable trade practices and to
provide for an equitable competitive and informed and safe market place, and provide for regulation, where necessary, for supply
of goods and services and for related purposes.”
Section 39(1) of the Decree provides as follows:
“Every person commits an offence against this Decree who, whether as prin or agent, and whether by himself or his agent, refuses to
s to sell any goods or services except on the condition that other goods or services are also purchased from him or from any other
person nominated by him, or attempts to impose any such condition.”
Section 43(2) of the Decree provides:
span>
“A person who offers goods for sale by retail shall not refuse or fail, on demand of a quantr number of the goods and tand tender
of the appropriate price, to supply the goods in the quantity or number demanded.”
ass=MsoNormal stal style="margin-top: 1; margin-bottom: 1"> Section 54 of the Decree provides as follows:
“(1) &nnbsp; A person shal shall not, an trade or commerce e in conduct that is misleadsleading or deceptive or is likely to mislead
or deceive.
1"> p class=MsoNormaNormal style="text-indent: -34.9pt; margin-left: 70.9pt; margin-top: 1; margin-bottom: 1"> (2) ; Nothing in this Dinisiollshall be taken as limiting by imby implication the generality of subsection (1).”
The facts of this case show that the manifestation of the intention to terminate electricity supply, coincided with the inability
of the parties to agree to a rental arrangement for Lewadua”. Although the Defendants suggest that the Plaintiffs were told in 1998,
this is denied by them, and will clearly be disputed at trial. If the Plaintiffs are believed however, the first intimation of withdrawal
of supply, came in January 2000, when negotiations for the rental agreement had become frustrated. It is not in dispute that the
Defendant Company is the only electricity supplier on the island. I am satisfied that the Plaintiffs have shown that the issue of
whether or not the Defendant Company had been engaged in deceptive conduct in relation to the rental agreement, and whether or not
the Defendant had used its exclusive supply of electricity to force an agreement on the rental arrangements, are serious questions
that warrant trial.
Clearly there are many disputes of fact in this case. However as Lord Diplock said in American Cynamid (supra) at page 510:
“It is no part of the court’s function at this stage of the litigation t to resolve conflicts of evidence on affidavit as to facts
acts on which the claims of either party may ultimately depend nor to decide difficult questions of law which call for detailed argument
and mature considerations. These are matters to be dealt with at the trial.”
Damages
Would damages adequately compensate the Plaintiffs for the termination of the electricity supply?
If the supply is cut off by the Defendant, the Plaintiffs will need to construct their own generatonexure K to Deng Carlson’s affidavit
suggest that a generatnerator would cost about $24,000 to construct. Clearly the building of a generator can be costed and be the
subject of compensation.
Although the Plaintiffs say that the generator would affect the quiet enjoyment of their house, I am not satisfied that this is so.
Firstly the evidence is that all the other houses on the island (except for one) have their own generators. Secondly, if the Plaintiffs
succeed, the generator can simply be removed thus restoring the former electricity supply. Finally, the evidence shows that the Plaintiffs
are not in permanent residence of the house and that the house is in fact occupied by their domestic staff. There is no evidence
that a generator would adversely affect the house’s market/rental value.
The Defendant Company on the other hand, has shown that the resort is undergoing extensions which require a heavier supply of eicity.
Frequent power failufailure would affect business. I accept that such loss of business would be difficult to quantify, and more importantly,
difficult to restore in the competitive hotel business. The Defendant therefore may never be adequately compensated in damages. The
injunction should therefore be refused on this ground.
The principle that an injunction lies even where damages are an adequate remedy, if the Plaintiff shows an infringement of a legaht
(Shelfer -v- City City of London Electric Lighting Company (supra) would apply where the Plaintiff had established a breach of the right. In this case, whilst the Plaintiffs have shown that
there is a triable issue, I consider that it would be oppressive to the Defendant to grant an injunction to continue with supply,
at the risk of enormous loss of business. Furthermore, I am not satisfied that the Defendant Company in giving 75 days notice to
the Plaintiffs of discontinuance of electricity, acted with “a reckless disregard to the plaintiff’s rights ...” (Shelfer -v- City of London (supra at page 323)an>
<
Having refused the injunction in equity, ity, I now turn to section 125 of the Fairing Decree 1992. That section provides:
“(1) An injunctionrundes thitioection may be granted by the Court -
(a)& against a person in thin ohe course of proceedings against that person for an offence against this Decree; or
(b) ;&nspp; as any other time.
(2) ; Ispthe ourt is sati, on , on the application of thef the Minister, the Director or any other person that a person has engaged,
or is proposing to engage, in ct thnstitor woonsti-
(a) & p;&nssp; asp; a contrcontravention of a provision of this Decree;
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(b) attempting to contr vene auch a provision;
(c) &nbssp;&nnsp;& asp; aiding,ding, abetting, counselling or procuring a person to contravene such a provision;
(d) &nnbsp;;&nspp; isp; inducinducing or attempting to inducinduce, whether by threats, promises or otherwise, a person to contravene
such a provision;
(e) being in any way, directli or indirectly, knowingly concerned in, or party to, the contravention by a person of such a
provision; or
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(f) p; conspiwing otth s to contrcontravene such a provisrovision,
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the court may grant an injunction in such terms as the Court determines to be appropriate.
&-GB>
(a) iecludut, b nmised tt, the, the power to gran grant an injunction restraining a person from carrying on a business of supplying
goods or services (whetr notart o incil to,carryn of another bher busineusiness) -ss) -
>
i) & &nbp;&&nbp;;&nbpp; & &nbp; for a speciperd period;
iiGB>ii) &nnsp;&&nsp;;&nspp;&nssp;&nsp; p;&nssp; exceptxcept on specified terms and conditions; &-GB> nbsp;
(b) ;&nbssp; &nsp;&nboes noes not include the power twer to grant an injunction restraining a person from engaging in conduct that
constitutes or would constit conttion y of sections 54 or 55 unless -
i) ;&nbssp; &nsp; &nbs; &nbbp;&nnbp;& &nbbsp; tpan>the appe application is made by the Minister or the Director e grothat sumeror cors gely are, or would be, adve affected by the
conduct; or
ii) p; &nnsp;&nbp;&&nbp;;&nbpp;&nbp;
(4) ; I thet oursati satisfied,fied, on application by the Minister or the Director that a person has engaged in conduct constituting
a contravention of a provision of this Decree thet mayt an ction requiring that phat personerson to t to take specified action (which
may include the disclosure of information or the publication of advertisements) to remedy any adverse consequences of his contravening
any provision of this Decree.
This subsection does not apply in relation to co that constitutes a contravention solely of section 55.
(5) &&nsp;; Tsp power of thrt thrt to grant an injunction rion restraining a person from engaging in conduct may be exercised
-
&nbB> span>
(a) &nbbsp;&&nsp;; wsp; wheth neth not it appears to the Cour Court that the person intends to engage again, or to continue to engage,
in conduct of that kind; (b) &nnbsp;; bsp; whether or not the person hasn has previously engaged in conduct of that kind; and
(c) &nnbsp;; bsptheheor n t thet there is an imminent danger of s of substantial damage to any person if the first-mentioned person
engagesonducthat lang=EN-GB>(6) &nbssp;&nnsp;& Tsp; The powe power of the Court to grant aant an injunction requiring a person to do an act or
thing may be exercised -
(a) wrethenoor t a iearspto thto the Court that the person intends to refuse or fail again, or to continue to refuse or fail,
to do that act or thing;
(b) ;&nspp; wsether or notpersoperson has previously refusrefused or failed to do that act or thing; and
(c) p; &nsp; whether or not theren immi imminent danger of substantial damage to any person if the first-mentioned person
refuses or fails to do that act or thing.
(7) &nnbsp;; An interim injunction may may be granted unde under this section pending the final determination of the application.
(8) &nnsp;& Asp;nalfinjunition tion may, by consent of the parties, be granted under this section without proof that proper grounds
for the injunction exist.
(9) ;&nbssp; bsp; Where the Minister o the Dthe Director applies for an injunction under this section, no undertaking damages
or costs will be required.
(10) &nnbsp;Mine ter ster or irer irector may give an undertadertaking as to damages or costs on behalf of some other applicant
and, in that event, no further undertakill buiredan>
(11) An injunctionrundes thitiyectiy be rescinded or varied ated at any time.”
&n/span: 1"> Counsel for the Plaintiff referred me to the decision of the New Zealand Court of Appeal in Ricegrowers’ Co-operative Ltd. -v- Howling Success Australia Pty Ltd. (1987) ATPR 489 which considered the provisions of section 80 of the Australian Trade Practices Act 1974, which is almost identical
to our section 125. It was held that once the applicant had shown that there was a serious question to be tried in respect of a breach
of the Act, the court should only consider where the balance of convenience lay.
Applying those principles to this case, I have already stated that I am satisfied that there are serious questions to be tri respect
of alleged breacheeaches of the Decree.
However I am not satisfied that the balance of convenience favours the Plaintiff.
Firstly whilst there are triable issues, the facts disclosed (which are mostly in dispute) thus far do not show a clear breach of
the Decree. As Gummow J said in Ricegrowers’ Co-operative Ltd. -v- Howling Success (supra at page 492), “The balance of convenience may ... be itself affected by the Court’s evaluation or perception of the seriousness
of the question, that is, the weight of the applicant’s case: Castlemaine Tooheys Ltd. -v- South Australia (1986) 60 ALJR at p.682.
In the circumstances the balance of convenience dot favour the grant of an interlocutory injunction.
For these reasons, I refuse the Plaintiffs’ application for an injunction restraining the Defendant from terminating electricity supply
to “Lewadua”. The Defendant’s costs are to be paid by the Plaintiffs, which I set at $300.
Nazhat Shameem
JUDGE
At Suva
3rd May 2000
Hbc0189d.00s
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