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SSP Marble and Granite Ltd v Khan [2014] FJHC 172; HBC166.2011 (10 March 2014)

IN THE HIGH COURT OF FIJI AT LAUTOKA
CIVIL JURISDICTION

CIVIL ACTION NO. HBC 166 OF 2011

BETWEEN:

SSP MARBLE AND GRANITE LIMITED a limited liability company having its registered office in Nadi.
PLAINTIFF

AND :

MOHAMMED AKBAL KHAN also known as IQBHAL KHAN of Lot 5, Salovi, Nadi Back Road, Nadi.
DEFENDANT

Appearances: Mr Anil J. Singh for the Plaintiff
Ms Tabuakoro for the Defendant

Date of Hearing: 10/3/2014

Ruling

Introduction

1. The Notice of Motion dated 14th February 2013 filed by the defendant sought the following orders:

a) That the judgement made against the Defendant on 30th October 2012 by Justice Priyantha Nawana be set aside.

b) That the judgement made against the Defendant on 30th October 2012 by Justice Priyantha Nawana be stayed pending the hearing of the setting aside application.

c) That the Bankruptcy proceedings being Civil Action No. 1 of 2013 filed at the Nadi Magistrate's Court be stayed until the determination of the setting aside application.

d) That the service of this application be abridged to two (2) days.

e) That the costs of this application be costs in cause.

2. This application supported by an affidavit sworn by the defendant on 13th February 2013 was made under Order 35 Rule 2, Order 45 Rule 10 and inherent jurisdiction of the court.

3. The Affidavit of the defendant states the following:

i) That the matter was listed before Justice Nawana on 18th June 2012 at 9am.

ii) That the defendant appeared before the Judge when the Plaintiff and/or its counsel was not present, the matter was struck out for non- appearance by the plaintiff.

iii) That on 13th February 2013 a bailiff came to his place and his neighbours informed him of the same.

iv) That he attended High Court Registry at Lautoka and a copy of the Judgement was given to him.

v) That no documents were served on him in the action herein after 18th June 2012.

vi) That his solicitors have adviced him, his counter-claim has not been struck out by the Judge in the Ruling and that he intends to proceed with his counter-claim.

vii) That on 13th February 2013 the bailiff served him with a bankruptcy Notice marked MA K I

viii) That he has a Prima facia defence and a meritorious counter-claim against the Plaintiff.

ix) That the plaintiff will proceed with Bankruptcy Action if the judgement that was entered against him for non-appearance on 30th October 2012 is not stayed.

x) That in any event the Plaintiff will not be prejudiced if his application is heard before the plaintiff could proceed with the execution pursuant to judgement dated 30th October 2012.

xi) That there has not been an inordinate delay in making the application.

4. The plaintiff company opposes the application and in its affidavit in response sworn by its Director states the following:

i) That the Honourable Court informed the defendant on numerous occasions that the matter was listed for hearing as stated in the judgement of the learned Trial Judge at paragraph 5.

ii) That the defendant made another application seeking that judgement made against the defendant on 30th October 2012 be stayed pending the hearing of the set aside application.

iii) That the defendant alleges that his counter-claim was not struck out therefore the defendant was aware of the proceedings and ought to have been aware by making reasonable enquiries.

iv) That the defendant has passed the 7 days to make this application after the trial.

v) That the plaintiff attended the hearing with two witnesses including the lawyer who drafted the agreement between the Plaintiff and defendant.

vi) That the defendant does not have any merit in regard to his defence or his counter-claim.

vii) That he has been informed that the plaintiff may depart out of Fiji and is merely buying time and that he has avoided service of court documents.

viii) That the application is an abuse of Court process.

ix) If the court is mindful to grant the application now, the judgement sum should be deposited in Court.

The Submissions

5. Both parties have provided written submission on this matter on the request made by court on 20th May 2013.

6. When the matter was mentioned in Court on 10th March 2014 the Counsels agreed to have a ruling delivered on the written summon already filed.

7 (1) By the written submission filed the defendants counsel submits that:

i) The defendant did not receive any application for re-instatement of the matter to the cause list.

ii) The defendant came aware of the judgement against him after attending High Court on 13th February 2013 upon his neighbour informing him that the bailiffs were looking for him.

iii) The defendant claims that no document were served on him by the Plaintiffs solicitors for re-listing the matter to cause list. It also means that he did not receive any NOAH (Notice of Adjourned Hearing) from the Court Registry.

iv) That the defendant has a good and a meritorious counter-claim, stay ought to be granted.

v) That the defendant is relying upon order 35 Rule 2 of the High Court rules on setting aside the default judgement.

vi) As the defendant was not aware of the judgement until sometimes 13th February 2013 sealed order not being served on him he could not make any application within 7 days as required under Order 35 Rules 2 (2).

vii) In any event the High Court has inherent jurisdiction to extend the time.

viii) Further Order 2 Rule (1) of the High Court Rules states that "where ...........at any stage..........in connection with any proceedings, there has,................been a failure to comply with the requirements of these Rules...............the failure shall be treated as an irregularity and shall not nullify the proceedings, .................................."

ix) That there is a prima facia defence and a meritorious counter- claim against the plaintiff and the counter-claim has not been struck out.

x) For the reasons above the judgement entered against the defendant be set aside.

7. (2) The summary of the plaintiffs submissions are as follows:

i) That the defendant appeared in Court on the 19th of March 2012 and 24th April 2012 and informed the court he would appear in person to defend his case.

ii) The defendant failed to appear despite several notices being sent by court indicating the date of trial and the conduct of the defendant is an abuse of court process.

iii) The matter was set down for hearing previously and on that occasion it was adjourned with cost awarded against the defendant, cost yet to be paid.

iv) Plaintiff has suffered damages due to defendant's actions.

v) The judgement entered was not irregular however was a regular judgement.

vi) The defendants affidavit failed to show that his action has some prospect of being partly successful.

vii) The plaintiff will be prejudiced if the judgement is set aside as he is a businessman in Australia and will have to make arrangements to be present once again at the next hearing date and if the court is mindful to set aside the judgement that cost be imposed for the damages.

viii) The defendants applications be struck out.

The Law and Analysis

8. In Anlaby and Others v Praetorioius [1888] UKLawRpKQB 55; (1888) 20 QBD 764 at 769 Fry LJ stated:

"There is a strong distinction between setting aside a judgement for irregularity, in which case the Court has no discretion to refuse to set it aside, and setting it aside where the judgement, though regular, has been obtained through some slip or error on the part of the defendant, in which case the Court has a discretion to impose terms as a condition of granting the defendant relief............."

9. When applying the above principle in setting aside a default judgement the first issue to be considered is whether a judgement is regularly entered or not.

10. Order 2 Rule (1) of the High Court Rules provides that a judgement entered in non compliance with the rules shall be treated as irregular. Order 2 (Rule 2) provides the discretion of Court to set aside irregular judgements.

11. Order 2 Rule (1) states as follows

"Where, in beginning or purporting to begin any proceedings or at any stage in the course of or in connection with any proceedings, there has, by reason of anything done or left undone, been a failure to comply with the requirements of these Rules, whether in respect of time, place, manner, form or content or any other respect the failure shall be treated as an irregularity and shall not nullify the proceedings, any step taken in the proceedings, or any document, judgement or order therein"

Order 2 Rule (2) states as follows

"Subject to paragraph (3), the Court may, on the ground that there has been such a failure as is mentioned in paragraph (1), and on such term as to costs or otherwise as it thinks just, set aside either wholly or in part the proceedings in which the failure occurred, any step taken in those proceedings or any document, judgement or order therein or exercise its powers under these Rules to allow such amendments (if any) to be made and to make such order (if any) dealing with the proceedings generally as it thinks fit."

12. The defendant has deposed in his affidavit that he appeared before the judge on 18th June 2012 and since the plaintiff and/or its counsel was not present, the matter was struck out for non-appearance by the plaintiff and since then he has not received any application for re-instatement of the matter to the cause list or any application from the plaintiff and/or its solicitors.

13. He states further that on or about 13th February 2013 his neighbours informed him that a bailiff came to his place and there after he attended High Court Registry of Lautoka where he was served with a copy of the judgement.

14. He also states that his counter claim has not been struck out by the judge in the ruling and he intends to proceed with the same.

Observations and Conclusion

15. In perusing the case record I find that the following entries therein made are material to this application.

(i) On 24th April 2012 the Honourable Master has referred this matter to the Deputy Registrar for him to forward it to a judge for the purpose of issuing notices to the parties to appear in High Court in order to fix a hearing date.

(ii) The plaintiff has filed an Ex-Parte Notice of Motion dated 30th May 2012 seeking an injunction against the defendant.

(iii) On 18th June 2012 when the matter called with Notice of Adjournment for mention to both parties, Justice Nawana has dismissed the Injunction application of the plaintiff as the plaintiff was not present and unrepresented. It is recorded on the attendance slip that the defendant has appeared in person on said date.

(iv) On 20th June 2012 the matter mentioned in court with Notice to both parties to set a hearing date and adjourned to 28th August 2012 to fix a hearing date. It is recorded that the plaintiff was represented by counsel and the defendant was absent. However, there is no proof of service of the Notice on the defendant.

(v) On 28th August 2012 Trial fixed for 25th-26th October 2012. It is recorded that the plaintiffs counsel was present and the defendant absent. The court has ordered the Notice of trial date to be issued to the defendant returnable on 17th September 2012.

(vi) Registry has issued Notice of Trial date to defendant returnable on 17th September 2012 through bailiff and the bailiff in his report dated 17th September 2012 sates that he was informed by the defendant's house keeper that the defendant was out of the country.

(vii) On 17th September 2012 when the matter was mentioned in court it is recorded by Justice Nawana that the "defendant is absent and unpresented and said to be out to the Country, Registry to issue notice communicating giving the trial dates of 25-26/10/12 early."

(viii) Accordingly, Notice of Adjournment for trial dated [NOAH] issued by the Registry to the defendant through bailiff and the bailiff in his report dated 25th October 2012 states that the defendants residence was empty and closed and on the last visit he was informed by the house girl that the defendant was away overseas and will be back in December.

16. As mentioned in the above paragraph it is evident from the entries made in the case record itself that the NOAH has not been served on the defendant before the date of Hearing and as such he was not aware of the Hearing date.

17. Considering all the above, it is my view that the default judgement dated 30th October 2012 is a judgement obtained without complying with the requirements of the High Court Rules and therefore is irregular, and as such the Court has no discretion to refuse to set aside it.

18. The next issue to be considered in this matter is whether there is delay in bringing this application.

19. Under Order 35 Rule 2 (2) an application to set aside a default Judgement should be made within 7 days after the trial. Under Order 2 Rule 2 (1) an application to set aside a default judgement for irregularity must be made within a reasonable time and before the party applying has taken any fresh step after becoming aware of the irregularity.

20. As I have already determined that the default judgement in this matter is irregular, I must be satisfied that the defendant has brought this application within a reasonable time.

21. The defendant has deposed in his affidavit that he came to know about the default judgement on the 13th of February 2013. There is no evidence before me to prove that the judgement was served on him before that. He has made this application the following day. Therefore, I am of the view that he has acted promptly in bringing this application.

Orders

22. Accordingly, I make the following Order:

a) The judgement made against the defendant on 30th October 2012 be set aside.

b) No costs.

L.S. Abeygunaratne
Judge

31.3.2014