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Nagamma v Khan [2004] FJHC 385; HBC0168.2003L (9 March 2004)

IN THE HIGH COURT OF FIJI
AT LAUTOKA
CIVIL JURISDICTION

CIVIL ACTION NO. HBC0168 OF 2003L

BETWEEN:

NAGAMMA
1st Plaintiff

AND:

SAIRA BEGUM
2nd Plaintiff

AND:

MOHAMMED SHEIKH KHAN
1st Defendant

AND:

AFZAL KHAN
2nd Defendant

AND:

RAJINDAR KAUR
3rd Defendant

AND:

COLONIAL MUTUAL LIFE ASSURANCE SOCIETY LIMITED
4th Defendant

Counsel for the Plaintiffs: Ms. N. Khan & Mr F. Khan
Counsel for the 3rd & 4th Defendants: Mr. Chen B. Young

Date of Hearing & Judgment: 9 March 2004

EXTEMPORE JUDGMENT

This matter comes before the court by way of a Summons filed by the 3rd and 4th defendants wherein they seek an order that the interim injunction granted against the 4th defendant on the 22nd of May 2003 be dissolved upon the grounds in the affidavits of Moira Tamton, Rajindar Kaur Gounder and Vipul Mishra.

On the 22^nd of May 2003 Byrne J. in chambers granted orders ex-parte after reading the affidavits in support of Saira Begum and Nagamma sworn on the 20^th of May 2003 and upon hearing Mr. F.F. Khan, counsel for the plaintiffs. Orders then made by His Lordship were that and I summarize:-

1. That the 4^th defendant be restrained from exercising its power of sale of the subject land;
   
2. That the 4^th defendant provide particulars of the cheque in the sum of Fifty Two Thousand Dollars ($52,000.00);
   
3. The 2^nd defendant provide particulars of how the cheque in the sum of Fifty Two Thousand Dollars ($52,000.00) was paid out;
   
4. Ancillary orders for the implementation for those orders.
   

The application before the court by the 3^rd and 4^th defendants relies on several grounds but firstly on the ground that there has been material non-disclosure by the plaintiffs at the time the injunction was sought and granted.

It is trite to say that an applicant for ex-parte orders must be frank and candid in disclosing material matters to the court. This obligation of candour includes, especially disclosure of matters that may be adverse to the applicant’s case. Any breach of that obligation of candour on an application for interlocutory injunction will generally lead to the dissolution of any orders made pursuant to that application.

The defendants in their submission take the court to Rex v Kensington Income Tax Commissioners [1917] 1 KB 486 which is approved in Fiji by Civil Appeal No. 66 of 1984, a decision of the Fiji Court of Appeal in Rauzia Mohammed v ANZ Banking Group. In that decision the court cited a statement made in Dalglish v Jarvie [1850] EngR 688; 2 Mac. & G. 231 which statement was cited with the approval by Lord Cozens-Hardy M.R. in Rex v Kensington Income Tax Commissioners and I quote:

“It is the duty of a party asking for an injunction to bring under the notice of the court all facts material to the determination of his right to that injunction; and it is no excuse for him to say that he was not aware of the importance of any facts which he has omitted to bring forward.”

The Court of Appeal also relied upon the Republic of Peru v Dreyfus Bros. & Co. 55 L.T.R 802 Kay J. stated and I quote:-

“I have always maintained, and I think it most important to maintain most strictly, the rule that, in ex-parte applications to this court, the utmost good faith must be observed. If there is an important misstatement, speaking for myself, I have never hesitated, and never shall hesitate until the rule is altered, to discharge the order at once, so as to impress upon all persons who are suitors in this court the importance of dealing in good faith with the court when ex-parte applications are made.”

Again the Fiji Court of Appeal noted that this passage was previously cited with approval in Rex v Kensington Income Tax Commissioners. There can be no doubt that any failure to disclose material facts will justify and cause the court to set aside orders granted ex-parte.

The reason for what may otherwise appear to be a draconian standard and is indeed obvious. The court when considering to grant or not to grant an injunction ex-parte has before it only the material contained in the affidavit in support of the motion. There is no opportunity for that material to be tested nor indeed is there any opportunity for any submissions to be made by the respondent or anybody on the respondent’s behalf. It is therefore essential that all facts and particularly those facts which are perhaps not favourable to the applicant, are indeed put before the court when an ex-parte injunction is sought.

The power of an injunction makes that even more necessary than it might be in other ex-parte applications.

The 3^rd and 4^th defendants submit that there has been a number of non disclosures, being a letter dated 13 February 1998 from Saira Begum witnessed by Rashid Ali and a further letter dated 8 January 1999 from Saira Begum to Moira Tamton, a letter dated 5 March 1999 from R. Kumar & Co. and a letter dated 5 August 1999 from Benjamin Kumar to Moira Tamton. These letters are each annexed to the affidavit of Moira Tamton filed on 14 October 2003.

The first of letters is MT-23 to that affidavit and that letter most relevantly contains a very clear acknowledgement of the debt and thanks the 4^th defendant for its co-operation in agreeing to extend the time for payment of the mortgage. It also acknowledges that a dispute exists but the 4^th defendant is not part of that dispute.

The second letter is MT-32A to that same affidavit and that is a handwritten letter to Moira Tamton dated 8 January 1999 and that deals with the transfer by the 2^nd plaintiff of an interest in the title to the 2^nd plaintiff’s husband.

The third letter is MT-34 to that same affidavit being a letter from R. Kumar & Co., Barrister & Solicitor to the 4^th defendant written on behalf of the 2^nd plaintiff and also bearing the signature of the 2^nd plaintiff and Benjamin Kumar which signatures confirm the contents of the letter. The letter is again a very clear acknowledgement of the debt to the 4^th defendant.

MT-41 is a letter to Moira Tamton dated 5 August 1999 signed by Benjamin Kumar and again is an acknowledgement of the debt and deals with other issues as one would expect a borrower to do with respect to the secured property and its dealings with the lender.

Counsel for the plaintiffs submit that all of these letters were written after a point in time when the 2^nd plaintiff became aware of the existence of the mortgage and that they were written after the 2^nd plaintiff was coerced or placed in a position of duress by the 4^th defendant to acknowledge the debt to enable a repayment program to be arranged or some extension of time to be granted and that the general content of those letters was in fact contained in the plaintiffs’ affidavit in support of the motion for the injunction and that there is therefore no material non disclosure by the failure of the plaintiff to disclose the particular letters when seeking the injunctive relief. As I have said earlier the bar is indeed high when the court considers the need for there to be full and frank disclosure by the plaintiff seeking ex-parte injunctive relief.

It is my opinion that the plaintiff in this instance has failed to disclose matters which in my opinion are or would have been at that time material to the court in considering whether or not to grant the relief sought. I again emphasise that the test as imposed by the court for more than a century is a very severe test.

On being satisfied that there has been material non disclosure I find it unnecessary to consider the other issues raised by the 2^nd and 4^th defendants in support of the summons and I don’t therefore addressed those issues.

The Orders of the Court are:

1. Order in terms of the summons; and
   
2. The plaintiffs pay the 3^rd and 4^th defendants’ costs of this application which I assess in the sum of One Thousand Dollars ($1,000.00).
   

JOHN CONNORS
JUDGE

AT LAUTOKA
9 March 2004