Apostle Gospel Outreach Fellowship International v Fiji Development Bank [2015] FJCA 42; ABU35.2014 (13 March 2015)

IN THE COURT OF APPEAL
ON APPEAL FROM THE HIGH COURT

CIVIL APPEAL: ABU 35 OF 2014
(High Court HBC 277 of 2011)

BETWEEN:

APOSTLE GOSPEL OUTREACH
FELLOWSHIP INTERNATIONAL
First Appellant

AND:

POATA MATA UCULOA
TAITO WAQAVAKATOGA
JOKATAMA BOLA
(as trustees for the First Appellant)
Second Appellants

AND:

FIJI DEVELOPMENT BANK
Respondent

Coram : Calanchini P
Counsel : Mr N Tuifagalele for the Appellants
Mr P Sharma for the Respondent

Date of Hearing : 20 January 2015
Date of Ruling : 13 March 2015

RULING

[1] This is an application by the Appellants for an order for an enlargement of time in which a notice of appeal may be filed and served.

[2] The application was made by motion filed on 6 May 2014. In accordance with Rule 26(1) of the Court of Appeal Rules (the Rules) the application was deemed to have been made by summons and was heard as a chambers application. In support of the application the Appellants filed an affidavit sworn by Poata Mata Uculoa on a date that cannot be determined as the details of jurat were not completed. The affidavit was improperly filed on 6 May 2014. The application was opposed. The Respondent filed an answering affidavit sworn on 29 May 2014 by Surendra Prasad. With leave the Appellant filed an amended affidavit in support sworn by Poata Mata Uculoa on 18 June 2014. An amended answering affidavit sworn on 1 July 2014 by Surendra Prasad was subsequently filed with leave by the Respondent. Prior to the hearing of the application both parties filed written submissions.

[3] The Court's jurisdiction to determine this application is derived from section 13 of the Court of Appeal Act Cap 12 (the Act) and Rule 27 of the Rules. Pursuant to section 20(1) of the Act the power of the Court of Appeal to make such an order may be exercised by a justice of appeal.

[4] The Appellants are seeking an enlargement of time to appeal the judgment of the High Court delivered on 18 October 2013 whereby the learned Judge granted an order for vacant possession of State Leases 15054 and 15055 to the Respondent as mortgagee. A stay of execution of six was granted and the Appellants were ordered to pay costs summarily assessed at $1500.00. It should be noted that pursuant to section 3(e) of the Interpretation Act Cap 7 (as amended) where in any written law, instrument or document in force the word "Crown" appears, it is to be replaced by the word "State." The Respondent had commenced the proceedings in the High Court under Order 88 of the High Court Rules. Order 88 enables a mortgagor with a right to foreclose to seek an order for possession against any person in actual possession of the properties.

[5] In his Judgment at paragraph 6 the learned Judge identified facts that were not in dispute. The Respondent held a mortgage over state leases and a debt was owed under the mortgage. The debt under the mortgage was acknowledged by the Appellants. The Respondent gave the Appellants several opportunities to rectify the default which the Appellants failed to do. The Respondent called for tenders for the sale of the two leases (the mortgaged properties). Tenders were received and one had been accepted.

[6] Whether the application should be granted and time enlarged involves the exercise of a discretion. The factors to be considered by a court in such an application were considered by the Supreme Court in NLTB v. Ahmed Khan and Another (unreported CBV 2 of 2013; 15 March 2013 per Gates CJ) in order to ensure that the judicial discretion is exercised in a principled manner. They are (a) the length of the delay; (b) the reason for the delay; (c) whether there is a ground of merit justifying the appellate court's consideration or, where there has been substantial delay, nonetheless is there a ground of appeal that will probably succeed and (d) if time is enlarged, will the respondent be unfairly prejudiced? These matters should be considered in the context of whether it would be just in all the circumstances to grant or refuse the application.

[7] In this case the final judgment of the High Court was pronounced on 18 October 2013. Pursuant to Rule 16 of the Rules the Appellants were required to file and serve the notice of appeal within 42 days from that date, that is, by 29 November 2013. The notice of appeal was filed on 27 November 2013 but was not served within time. There was non-compliance with the Rules and as a result there was no appeal before the Court. To proceed further it was necessary for the Appellants to seek leave for an enlargement of time. The motion seeking the enlargement of time was filed on 6 May 2014 and was served on the Respondent on 14 May 2014.

[8] The length of the delay is determined by calculating the length of time between the last day on which the Appellants were required to have filed and served the notice of appeal and the date on which they filed and served the application for the enlargement of time. In this case the length of the delay is the period of time between 29 November 2013 and 14 May 2014 being a period of about 5½ months.

[9] The reason for the delay is set out in paragraphs 10 to 14 in the affidavit filed on 6 May 2014 and in paragraphs 11 and 12 of the amended affidavit filed on 19 June 2014. The explanation appears to be that the notice of appeal was not served because the parties were engaged in negotiations in an attempt to come to an arrangement for repayment of the mortgage debt. However that explanation hardly justifies a decision not to serve an appeal notice which had however been filed within time. Furthermore the explanation is unconvincing since the Appellants had filed on 28 November 2013 an application for a stay which had been subsequently served on 12 December 2013. If the Appellants were serious about the appeal rather than using the appeal as a negotiating tool, then they should have ensured that the notice was both filed and served within time. The explanation is not satisfactory and does not exercise non-compliance with the Rules, non-compliance in the form of delay which can only be described as inordinate.

[10] Under those circumstances, the exercise of the judicial discretion does depend to some extent on the merits of the proposed appeal. As Thompson JA in Tevita Fa –v- Tradewinds Marine Ltd and Another (unreported ABU 40 of 1994; 18 November 1994) observed at page 3:

"However, as important as the need for a satisfactory explanation of the lateness is the need for the applicant to show that he has a reasonable chance of success if time is extended and the appeal proceeds."

[11] In view of what I have described as inordinate delay but which is undeniably substantial and the wholly unsatisfactory explanation for that delay, the Appellants must show more than that the appeal has a reasonable chance of succeeding. It is necessary for the Appellants to establish that the appeal will probably succeed. In effect this means that the Appellants must show that the appeal, or at least one ground has a high probability of establishing that the trial Judge was wrong in his judgment or that it would be an "injustice" to allow the judgment to stand. However the Court's task at this stage is not to consider in detail the merits of any particular ground of appeal, but rather to assess whether in the circumstances the appeal has met the necessary threshold for consideration by the Court of Appeal. Although the distinction between the two tasks is subtle, it must be recalled that it is not the function of a single judge exercising the jurisdiction under section 20 of the Act to determine the appeal.

[12] In the event that leave is granted the Appellants seek to rely on the following grounds of appeal that are set out in the supporting affidavit:

"1. The learned Judge erred in fact and in law by not considering the totality of the evidence adduced and submissions advanced by the Appellants and failed to consider what justice required in the circumstance.

2. The learned Judge erred in fact and law by failing to consider that the Appellants had made numerous proposals to the Respondent to salvage its situation as a mortgagor to save its secured properties.

3. The learned Judge erred in fact and in law by failing to consider that the First Appellant is a religious body that survives on the goodwill offering of its members and companies that were proposed to the Respondent who were willing to assist the Appellants were turned away by the Respondent without any explanation.

4. The learned Judge erred in law and in fact to consider that the Respondent has failed to disclose to the Court either through its filed affidavit or vide its oral and written submission as to who has been offered the mortgaged properties and this is a clog to the Appellants' right to redeem the mortgage as this right is extinguished once the Respondent enters into a contract of sale with the Purchaser.

5. The learned Judge erred in law and in fact by failing to consider the submission of the Appellant that the Respondent had offered one of the mortgaged properties afore-named to the building contractor appointed by the Appellants."

[13] In relation to ground one it is only necessary to make two observations. The first is the ground does not state specifically nor concisely what evidence the judge failed to consider. It is vague and expressed in the most general of terms. The second observation is that the learned trial Judge was not obliged to give any weight to the submissions of counsel. His obligation goes no further then to consider the admissible evidence and give what weight be considered to be appropriate to that evidence.

[14] The remaining four grounds are all concerned in one way or another with the application of the law by the trial Judge to the evidence adduced by affidavit. This is not a case where the Appellants rely on a breach by the Respondent of any of the requirements specified in the Land Transfer Act Cap 131. Nor is it a case where the Appellants allege that the Respondent is in breach of any term in the mortgage agreement. Nor is it submitted that the Respondent had failed to comply with the procedural requirements of Order 88. The Appellants have not paid any of the debt, let alone the full amount owing to the Respondent nor has the full amount owing under the mortgage been paid into court. This is simply a case where there is in existence an acknowledged debt of some FJD$6m owed to the Respondent by the Appellants under the mortgage agreement. In my judgment the negotiations that took place between the parties do not in way affect the rights that accrued to the mortgagee upon default by the mortgagor. In my view this appeal does not meet the threshold test that the Appellants must satisfy in order for the Court to exercise its discretion in favour of the Appellants.

[15] In addition the prejudice to the Respondent in this case is substantial. No repayments have been made since these proceedings commenced. The debt is increasing and the Appellants are still in possession. There was no material to suggest that the Appellants have any realistic possibility of raising the funds to meet the debt. Any sale that may be pending is placed at risk the longer the Appellants remain in occupation.

[16] For all of the above reasons I have concluded that it would not be just to grant an enlargement of time and the application should be dismissed with costs fixed summarily in the sum of $1800.00 to be paid within 28 days from the date of this Ruling.

Orders:

(1) Application for enlargement of time is dismissed.

(2) The Appellants to pay costs to the Respondent fixed in the sum of $1800.00 within 28 days from the date of this Ruling.

____________________________________

Hon. Mr Justice W. D. Calanchini
President, Court of Appeal