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Vanualevu Harware Fiji Ltd v Labasa Town Council [2014] FJHC 650; Civil Action 29.2012 (9 September 2014)

In the High Court of Fiji at Labasa
Civil Jurisdiction
Civil Action No. 29 of 2012

Between:

Vanua Levu Hardware Fiji Limited
Plaintiff

And :

Labasa Town Council
Defendant

Appearances : Mr S.Valenitabua for the plaintiff
Mr S.Sharma for the defendant
Date of hearing: 13th May,2014

Judgment

1. This is an application by the plaintiff seeking leave to appeal from an interlocutory decision of the Master of 20th September, 2013.
   
2. I will briefly reiterate the events that transpired in this case:
   
   • By writ of summons filed against the defendant on 17th May,2012,the plaintiff claimed specific performance of a contract and damages for breach of contract.
     
   • The defendant failed to serve its defence within the stipulated period of 14 days.
     
   • On 27th November,2012,default judgment was entered in favour of the plaintiff.
     
   • On 25thJanuary,2013, default judgment was set aside by consent on the conditions that the defendant file its statement of defence on or before 8th February, 2013, and costs of $300.00 be paid, prior to the filing of the defence.
     
   • On 21st March,2013,the plaintiff filed summons for assessment of damages .
     
   • On 10thApril,2013,the Master noted that "No defence filed as per order of 27/11/12..There also being no costs paid the Default judgment remains". (emphasis mine)
     
   • On 17thApril,2013, the defendant made an application under O.19, r.9 to vacate the order granted on 10th April,2013,and to comply with the orders of 25th January,2013.The defendant attached a statement of defence to his supporting affidavit.
     
   • On 6thMay,2013,when the matter was taken up, the defendant was neither represented nor present. The application was declined. The statement of defence was struck out by the Master.
     
   • On 6th June,2013, there followed a second application by the defendant to set aside the Master's Orders of 10th April,2013, and 6th May,2013, and to grant leave to comply with the Orders given on the 25th January 2013.
     
   • The Master, in his Ruling dated 20thSeptember,2013, held that the defendant should be given an opportunity to defend this matter on merit. He made the following Orders:-
     

1. That the Defendant is given 14 days from today's date to file a defence;

2. That the defendant to pay the cost of this application which I assess summarily as $500.00 also payable within 14 days from today's date;

3. That the above costs does not include the amount of costs already granted against the Defendant which amounts to $800.00; and

4. UNLESS the Defendant files its defence within the stipulated 14 days and pays ALL the costs under paragraphs (3) and (4) within that period of 14 days the default judgment first obtained against the Defendant stands.

5. The matter is further adjourned before me for directions on the Monday 7 October 2013.

• The plaintiff seeks leave to appeal from this decision.
  

3. The proposed grounds of appeal

The plaintiff has set out the following proposed grounds of appeal in its

1. The Learned Master erred in law and in fact in allowing further 14 days to the Defendant to file a defence when by its act and omissions it has defaulted on numerous times as follows:-
   
   • (a) By failing to file its Statement of Defence within time stipulated by the High Court Rules, i.e. within 14 days after the filing of Acknowledgment of Service, which was ordered as a consequence of the Respondent's application to set-
     

aside judgment in default entered against the Respondent by the Appellant.

(b) By failing to comply with Master's Orders of 10th April 2013 which were conditions to be met by the Respondent before the Default Judgment is set-aside. The Respondent failed to pay $300.00 costs and also did not file its Statement of Defence on or before 8th February 2013.

(c) By failing to attend Court on 6th May 2013 to move its Motion to vacate the Courts orders of 10th April 2013 which resulted in the same. Motion being struck-out by Order of the Court on 6th May 2013.

2. The Learned Master erred in law and in fact in holding that the Court is not functus and has a wide discretion to make further orders in this matter, an opinion which is inconsistent with the principles of 'unless-orders' or case management.
   
3. The Learned Master erred in law and in fact in stretching the principles held in Samat v. Qelelai HBC 201 of 2002L applied and adopted in Westmall Limited v. Cul (Fiji) Limited HBC 175 of 2001L so that the facts of this matter are consistent with the principles enunciated therein. Westmall relies on a different set of facts and circumstances of error or mistake. The Respondent's default conduct in this matter is more than an error or mistake.
   
4. The Learned Master erred in law and in fact in holding that it has the jurisdiction to determine the Respondent's third application filed on 6th June 2013.
   
5. The Learned Master erred in law and in fact in not considering the fact that the Respondent had lodged its Statement of Defence out of time for filing which in turn was accepted by the Court Registry against the Respondent's application as a show of desperation and direct contempt.
   
6. The Learned Master erred in law and in fact in holding that the failure by the Appellant to serve the Summons for Assessment of Damages upon the Respondent was an issue that needed to be considered in deciding the Respondent's application. In any event, when the Summons for Assessment of Damages was called on 11th June 2013 for hearing before the Master, counsel for the Respondent was present to move the Motion it filed on 6th June 2013 – a fact that waived service due to presence of counsel.
   
7. The Learned Master further erred in law and in fact in failing to consider that the hearing of the assessment of damages application by the
   

Appellant did not proceed as expected due to the application by the Respondent and there was no need to serve on a Defendant who continuously defaulted from filing its Defence so forth showing disinterest in the matter.

4. The determination

4.1. The arguments raised by Mr Valenitabua, counsel for the plaintiff in his application for leave to appeal and elaborated in the proposed grounds of appeal of the plaintiff are twofold.

4.2. The first is that the Master had no power to set-aside his Orders of 10th April, 2013, and 6th May,2013. Mr Valenitabua submitted that the Master was functus, once a judgment is perfected. In support, he cited the case of Chandra v Chand, (2013) FJHC 389.

His second contention was that the failure of the appellant to serve summons for assessment of damages on the defendant was not an issue that needed to be considered in deciding the defendant's application. It was argued that the plaintiff was not required to serve the summons, as the defendant had defaulted. The case of Andrew Skerelec v Tompkins and Others,(HBC 111 of 2008) was cited in support of that proposition.

4.3. Mr Sharma, counsel for the defendant argued that the Master was not functus. He contended that the Master could deal with non-compliance of unless orders.

4.4. The Master held that:

he "could still exercise its powers to deal with non-compliance of unless orders and is not functus. This power is derived from Order 32 Rule 9 and Order 59 Rule 2. It can exercise a power similar to a judge in all chamber applications including all procedural matters and that this is one of those applications including all procedural matters and that this is one of those applications. In support of the proposition that the Court could still make further orders the Defendant referred to the decision of Justice Wickramasinghe in Samat –vs- Qelelai (2012 FJHC 844) in which the Master's orders was set aside where there was non-compliance by the plaintiff. In this particular matter Justice Wickramasinghe agreed with the view of Justice Inoke in Westmall

Limited –vs- Cul (Fiji) Limited HBC 175 of 2001L that the function of the Court is:-

It is a well established principle that the object of the Court is to decide the rights of the parties, and not to punish them for mistakes they make in the conduct of their cases by deciding otherwise than in accordance with their rights.

4.5. The Master held further that he "has a wide and discretion to make further orders in this matter" and granted the defendant an opportunity to defend.

4.6. I find it difficult to understand how further orders could be made in the aftermath of the breach of the unless order of 25thJanuary,2013, and the default judgment remaining on foot. Interestingly, the Master preceded his final orders with the following observation:

..however it is inappropriate or impractical for this Court to revisit the Orders of 25 January as prayed for and that the only way his matter could proceed quickly is for an unless order or orders to be made.(emphasis added)

4.7. I would also note that the Master quite correctly noted that the affidavit in support of the application to set aside the orders "made no reference as to the reason why it did not comply with the initial order of the Court granted by consent on the 25 January 2013 in which leave was granted that it file its defence and pay costs. This affidavit did not help the Court in any way in deciding this matter. It referred mostly to the inability of the staff.. to keep tab of the filing of their documents...It is not a satisfactory answer or reason for the delay in not filing their defence to the claim as initially ordered".(emphasis added)

4.8. The Master relied on the decisions in Samat vs Qelelai, (supra) and in Westmall Limited vs Cul (Fiji) Limited,(supra).Both cases dealt with applications to reinstate actions struck out for non-compliance with an unless order. But the facts are not comparable to the present case, as urged in the plaintiff's third proposed ground of appeal. In the first case, an unless order was made when both parties were not present in Court, nor represented. In the second case, the Court found that the terms of the unless order were not clear.

4.9. The next point of contention is the service of summons for the assessment of damages on the defendant. In this regard, the Master held that the plaintiff had not complied with the rules regarding service of summons.

4.10. I am inclined to agree that the service of summons for assessment of damages on the defendant was not an issue to be determined, in the application before the Master.

4.11. In my view, the plaintiff has presented an arguable defence. In my judgment, the plaintiff has sufficient prospects of succeeding in the appeal. I would allow the application for leave to appeal from the interlocutory ruling of the Master.

5. Orders
   • (a) The application for leave to appeal from the interlocutory ruling of the Master of 20th September, 2013, is granted.
     
   • (b) The costs of this application are to be costs in the appeal.
     

9th September, 2014

A.L.B.Brito-Mutunayagam
Judge