Tassinari Enterprises Ltd v Yasawa Paradise of Fiji Ltd [1991] FJHC 53; Hbc0185d.91s (30 August 1991)

IN THE HIGH COURT OF FIJI
(AT SUVA)
CIVIL JURISDICTION

ACTION NO. 185 OF 1991

BETWEEN:

TASSINARI ENTERPRISES LIMITED
Plaintiff

AND

YASAWA PARADISE OF FIJI LIMITED
Defendant

Mr. J. Jamnadas: For the Plaintiff
Mr. I.C.S. Akhil: For the Defendant

Date of Hearing: 30th August 1991
Date of Ruling: 30th August 1991

RULING

By the Indorsement of Claim annexed to the Writ herein which was issued on the 20th of March 1991 the Plaintiff claims from the Defendant:

(a) The sum of $84,045.33 for goods supplied and services rendered by the Plaintiff to the Defendant at the Defendant's request;

(b) Damages for breach of a catering contract between the Plaintiff and Defendant whereby it was agreed that the Plaintiff would supply certain catering services to the Defendant;

(c) Damages for breach of a contract between the Plaintiff and the Defendant whereby the Plaintiff agreed to supply and the Defendant agreed to take delivery of 300 cubic metres of Vesi Timber; and

(d) An injunction restraining the Defendant from proceeding on the Demand issued by the Defendant pursuant to section 211 of the Companies Act 1983 and dated 26th of February 1991 to present a petition for winding up of the Plaintiff, advertising the same or otherwise.

The Writ then claims further and other relief and costs of the action.

On the same day on which the Writ was issued the Plaintiff issued an Ex-parte Notice of Motion for an injunction in the terms of Paragraph (d) of the Indorsement of Claim which was supported by an affidavit sworn that day by Teupola Toroca, the Managing Director of the Plaintiff.

Paragraphs 2, 3, 4 and 5 of the affidavit purport to give details of the Plaintiff's claim. They annex copies of certain invoices which allegedly provide evidence of the Plaintiff's claim and details of a quotation dated the 14th of August 1990 from the Plaintiff to the Defendant and apparently counter-signed by the Plaintiff's representative which is said to constitute the catering service contract referred to in Paragraph (b) of the Indorsement of Claim.

Paragraph 5 of the Plaintiff's affidavit refers to a contract with the Defendant by which the Plaintiff agreed to supply the Defendant with 300 cubic metres of Vesi Timber, delivery dates of which are set out in a letter from the Plaintiff to the Defendant dated the 2nd of February 1990.

The Plaintiff alleges that pursuant to this contract the Defendant paid $60,000.00 deposit to the Plaintiff on the 2nd of February 1991 but that because the Defendant was not in a position to accept delivery of the timber on the dates stated in the letter, the contract was varied to the extent that the Plaintiff would provide the timber on receipt of the Defendant's request for delivery. During January 1991, the Defendant requested the first delivery and the Plaintiff pursuant to such request sent 10 cubic metres more or less to the Defendant.

The Plaintiff alleges that the Defendant then without notice and unilaterally refused to take delivery and has never given any reason for such refusal. The Defendant through its solicitors requested a refund of the deposit of $60,000.00 by letter dated 4th of February 1991 which was followed by a Demand pursuant to section 221(a) of the Companies Act 1983.

The Plaintiff claims to have suffered damage as a result of the Defendant's actions and that the Defendant intends to proceed with a petition to wind up the Plaintiff and to advertise the same unless restrained from doing so, which action would cause irreparable harm to the Plaintiff. On the 21st of March 1991 my brother Jayaratne, J. granted the Plaintiff an interim injunction, which was to operate initially until the 11th of April 1991 and was continued on the 10th of April until the 29th of August 1991.

On the 7th of May 1991 the Defendant issued a Summons to have the injunction dissolved. This was supported by an affidavit by Layton James Wilkinson, Company Secretary of the Defendant and in due course the Plaintiff swore and filed an affidavit in reply to that of the Defendant on the 26th of August 1991.

My brother Jayaratne, J. was unable to hear the application for dissolution on the 28th of August and it was re-fixed that day by the Chief Registrar for hearing before me today. Basically the Defendant alleges non-disclosure of material facts by the Plaintiff with a view to misleading the Court and counsel has submitted to me today that had those facts been disclosed to Jayaratne, J. at the very beginning His Lordship would in all probability not have granted the interim injunction.

The Defendant alleges that it never entered into any agreement with the Plaintiff for the supply of any goods or any services from the Plaintiff nor has it issued any official purchases order for such goods or services. Two letters dated the 19th of March 1991 from the Defendant to the Plaintiff are exhibited to the Defendant's affidavit denying any agreement or authorisation for the Plaintiff to perform any services to the Defendant.

Also exhibited to the affidavit is a letter of the 19th of March 1991 from the Defendant to the Fiji Development Bank asking whether the Plaintiff had ever been involved in negotiations with the Bank for a loan which the Bank approved to the Defendant for development on Naukacuvu Island in the Yawasa Group by the Defendant, and a reply from the Bank dated the 3rd of April 1991 denying any dealings by the Bank with the Plaintiff in respect of such loan.

Again on the 19th of March 1991 the Defendant wrote to the Lautoka Rural Authority asking whether the Plaintiff had been involved in any way with development proposals for a resort hotel to be built by the Defendant on Naukacuvu Island, Naviti.

The Defendant exhibits a letter of reply from the Lautoka Rural Local Authority dated the 10th of April 1991 denying any such involvement by the Plaintiff. The Defendant claims that none of these letters was disclosed to the Court by the Plaintiff when seeking to obtain its interim injunction.

The Defendant admits that it agreed to purchase 300 cubic metres of Vesi Timber from the Plaintiff and it paid a deposit of $60,000.00 for this timber on the 2nd of February 1990 but that after it received 10 cubic metres of timber from a company called Toorak Builders Limited it rejected any further timber and the 10 cubic metres on the ground that it was not of the standard specified in an agreement between the Defendant and the Plaintiff relating to such timber. The Defendant alleges that the Plaintiff failed to disclose a letter from it to Mr. Tassinari confirming that the timber was not of the grade contracted for.

In its reply the Plaintiff denies any suppression of material facts, and referring to the letters of the 19th of March 1991 says that as these bear a stamp that they were received on the 19th of March 1991 and were not actually received by the Plaintiff until the 29th of March 1991, the Plaintiff could not suppress something that it had not received and had no knowledge of at the time the Plaintiff swore its affidavit on the 20th of March 1991.

In his submissions to me today Mr. Akhil states that since the bulk of the Plaintiff's claim is for commission in obtaining a loan for the Defendant and the Rural Authority's approval it is very strange that for its services for which the Plaintiff claimed $76,250.00 no contract has been disclosed by the Plaintiff. Furthermore Mr. Akhil relied on an agreement between the Defendant and Toorak Builders Limited in respect of the Defendant's development at Naukacuvu Island and says the Plaintiff is not a party to this agreement under which in any event the contractor was to supply materials. Furthermore Mr. Akhil refers me to Article 14(c) of the agreement under which it is the responsibility of the Defendant and nobody else to provide accommodation and food for the contractor's workforce.

Mr. Akhil submits that these facts were also not disclosed to Mr. Justice Jayaratne. Mr. Akhil also claims, and this was not disputed by Mr. Jamnadas, that the receipt stamp dated the 19th of March 1991 appearing on the Defendant's letters which I have mentioned above was actually the stamp of Mr. Akhil's own office and that the Plaintiff has attempted to mislead the court by alleging that the stamp was the Plaintiff's.

In reply Mr. Jamnadas denied any deliberate suppression of material facts by the Plaintiff but in my view this is not borne out by the evidence.

In a statement which has often been quoted in support of actions to dissolve injunctions Kay J. said in 1888 in The Republic of Peru v. Dreyfus and Company 55 L.T.R. 802 at 803:

"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 mis-statement, 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."

There have been later statements to similar effect by other Judges. Thus in Rex v. Kensington Income Income Tax Commissioners, Princess Edmond De Polignac, Ex-parte (1917) 1 K.B. 486 at pages 495 and 496 Viscount Reading C.J. said:

"Before I proceed to deal with the facts I desire to say this: Where an ex parte application has been made to this Court for a rule nisi or other process, if the Court comes to the conclusion that the affidavit in support of the application was not candid and did not fairly state the facts, but stated them in such a way as to mislead the Court as to the true facts, the Court ought, for its own protection and to prevent an abuse of its process to refuse to proceed any further with the examination of the merits. This is a power inherent in the Court, but one which should only be used in cases which bring conviction to the mind of the Court that it has been deceived. Before coming to this conclusion a careful examination will be made of the facts as they are and as they have been stated in the applicant's affidavit, and everything will be heard that can be urged to influence the view of the Court when it reads the affidavit and knows the true facts. But if the result of this examination and hearing is to leave no doubt that the Court has been deceived, then it will refuse to hear anything further from the applicant in a proceeding which has only been set in motion by means of a misleading affidavit."

In my view the statements of these Learned Judges are relevant to the facts as now disclosed in this case and I am firmly of the view that had the material now disclosed by the Defendant been disclosed by the Plaintiff when seeking to obtain the interim injunction herein, my brother Jayaratne, J. would not have granted it.

I am satisfied that the injunction should be dissolved and that if the Plaintiff has any remedy against the Defendant this is by way of damages. I therefore dissolve the injunction and order the Plaintiff to pay the Defendant's costs to be taxed if not agreed.

John E. Byrne
J U D G E

HBC0185D.91S