Fiji Development Bank v Thomas [1994] FJHC 77; Hbc0290d.94s (6 July 1994)

IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION

CIVIL CASE NO. HBC0290 OF 1994

FIJI DEVELOPMENT BANK
of 360 Victoria Parade, Suva
Plaintiff

and

ALFRED THOMAS
of Lautoka, Manager
Defendant

Counsel: Mr. V. Kapadia for Plaintiff

Date of hearing: 22nd June 1994
Date of decision: 6th July 1994

DECISION OF PAIN J.
ON EX PARTE MOTION FOR
INTERLOCUTORY INJUNCTION

The plaintiff has filed a writ against the defendant with an indorsement of claim seeking orders:

1. That the defendant forthwith return and deliver to the plaintiff Certificate of Title No.20508 together with discharge of mortgage No.184175.
   
2. Damages
   
3. Costs
   

At the same time the plaintiff filed an ex parte motion for an order that "the defendant do forthwith return and deliver Certificate of Title No.20508 and Discharge of Mortgage No.l84l75 to the plaintiff". The motion does not specify the particular rule relied upon. Counsel advises that it is an application for an interlocutory injunction under Order 29 Rule 1.

The basic facts are set out in the affidavit of Salote Tabakanaca filed in support of the motion. The defendant is the registered proprietor of the land contained in Certificate of Title No.20508. The title shows a first mortgage in favour of Morris Hedstrom Limited and further mortgages to the Fiji Development Bank (registered l0th March l986) and to Fiji National Provident Fund Board (registered 26th August l987). A Memorandum of Priority of Mortgage registered on 10th September l987 appears to give the Mortgage to the National Provident Fund Board priority over the mortgage to the Fiji Development Bank. There is also a further charge in favour of the Fiji National Provident Board registered on the 30th January l990.

In paragraph 4 of her affidavit Salote Tabakanaca states that "the debt owing to Morris Hedstrom Limited has been paid in full by the Defendant and through an oversight the relevant discharge of Mortgage No.l84l75 in favour of Morris Hedstrom Limited and the relevant Certificate of Title was handed over to Alfred Thomas". The Plaintiff has requested the Discharge of Mortgage and Certificate of Title from the Defendant but these have not been delivered up to the Plaintiff. As the Defendant is in default under the Mortgage to the Plaintiff, the Plaintiff has exercised its powers under the mortgage and sold the property. The Plaintiff requires the Discharge of the First Mortgage and Certificate of Title to settle this sale and asserts that "the prospective purchaser has been putting pressure on the Plaintiff to complete the transaction".

I interpolate here that, according to the memorials on the Certificate of Title, the mortgage to Fiji National Provident Fund Board appears to have been given priority over the earlier mortgage registered in favour of the Plaintiff. However Salote Tabakanaca in paragraph 5 of her afffidavit asserts that the Plaintiff "now being the first mortgagee after the discharge of the mortgage in favour of Morris Hedstrom Limited is entitled to the possession of Certificate of Title No.20508". Counsel for the Plaintiff also submitted that the Plaintiff is the mortgagee now entitled to the Certificate of Title and Morris Hedstrom was under an obligation to forward it to the Plaintiff. It has not been explained how the mortgage to the Plaintiff now takes priority over the mortgage registered in favour of Fiji National Provident Fund Board. However for the purpose of determining the merits of the present application, I am prepared to assume that the Plaintiff's mortgage ranks as a first mortgage after the discharge of the mortgage to Morris Hedstrom Limited.

When this ex parte motion was heard by me I expressed my concern to counsel for the Plaintiff that an order was sought on identical terms to the relief sought in the writ, namely, delivery of the discharge of Mortgage and Certificate of Title to the Plaintiff.

Counsel for the Plaintiff agreed that he was seeking an ex parte mandatory injunction against the Defendant. He submitted that the Plaintiff was clearly entitled to possession of the Discharge of Mortgage and Certificate of Title. If they are not obtained the Plaintiff will not be able to fulfil its obligations to the purchaser. Proceeding to judgment on the writ may be long delayed. He said that if the Defendant is given notice of this application, there is no knowing what the Defendant might do with the documents. The Plaintiff could suffer irreparable harm if, for instance, the Defendant endeavoured to sell the land to an unsuspecting purchaser. Counsel stressed that if an injunction is granted it will have a "return date" within which time the Defendant could apply to have the order set aside.

I have carefully considered the papers and submissions of counsel. In my view it is quite inappropriate to grant the injunction sought, despite the apparent strength of the Plaintiff's claim and disadvantages that may be caused to the Plaintiff by delay.

The usual purpose of an interlocutory injunction is to preserve the status quo until the rights of the parties have been determined in the action. (The Supreme Court Practice l993 Volume 1 page 511 para 29/l/2). This application by the Plaintiff is not to preserve the status quo but to obtain the final relief sought in the substantive action. The Plaintiff is really using the interlocutory injunction procedure to obtain final judgment without the Defendant having any opportunity of being heard. In my view this is inappropriate and inconsistent with accepted principles of justice.

The authorities on this topic clearly illustrate the reluctance of the Court to grant an interlocutory injunction that effectively puts an end to the substantive action. The reason for this is the real risk of injustice to a defendant who is denied the opportunity of having his rights determined by trial. (See Cambridge Nutrition Ltd. v British Broadcasting Corp. (1990) 3 ALL ER 523; Cayne & anor. v Global Natural Resources (l984) 1 ALL ER 225; N.W.L. Ltd. v Woods (1979) 3 ALL ER 614). In this case the Plaintiff seeks, not only to deny the defendant the opportunity to dispute the claim at trial if he so wishes, but also to deny him the opportunity of being heard at all. An ex parte application in the present circumstances is totally inappropriate.

Furthermore, it is not shown, on the papers, that "the case is one of urgency and the delay caused by proceeding in the ordinary way would entail irreparable or serious mischief". This threshold requirement must be satisfied before the Court has jurisdiction to make on ex parte order under Order 29 Rule 1. Ex parte interlocutory injunctions are not lightly granted and it is encumbent upon an applicant to lay all relevant facts before the Court. In this case the sale of the property by the Plaintiff is being delayed but no details of that sale have been given. Paragraph 8 of the affidavit of Salote Tabakanaca states that "the prospective purchaser has been putting pressure on the Bank to complete the transaction failing which the Bank may be sued for damages for breach of contract with the purchaser". However no details have been given of the nature of this pressure, the current situation between the parties or of any imminent action being threatened. Also, there is no foundation for an assumption that the Defendant may take some action to prejudice the Plaintiff, such as endeavouring to sell the land to an unsuspecting purchaser.

A further point is that the Plaintiff is seeking a mandatory injunction which is an exceptional form of relief. Usually an interlocutory injunction is in a negative form to restrain the defendant from doing some act. The factual circumstances of this case may be more consistent with and amenable to the granting of a mandatory injunction. Nevertheless the Court should proceed with particular caution before granting such an injunction which would effectively determine the substantive action between the parties. It would be exceptional to do this on an ex parte basis.

The argument that any disadvantages in making an ex parte order could be cured by incorporating a "return date" by which the Defendant may apply to set aside the order is untenable. This places the Defendant at a disadvantage. Instead of defending an application he is given the burden of applying to rescind an order of the Court. More particularly, however, the fact that a defendant could apply to set aside the order is absolutely no ground for making an order that is not justified on the papers. Proper grounds must first be established.

Although it is not a decisive matter in this case I note that the affidavit in support of the application was sworn on the 10th June l994 and the Writ was filed on the 16th June l994. The affidavit should be sworn after the writ is issued. (The Supreme Court Practice l993 Volume 1 page 516 para 29/1/11)

In all the circumstances this is not a case for the granting of an interlocutory injunction in the terms sought. Grounds have not been made out for that.

Understandably, the Plaintiff will have some concern about the situation. On the face of it, the Plaintiff has a strong prima facie case against the Defendant for delivery of the title and discharged mortgage. Counsel advises that there is likely to be considerable delay in hearing the action and the Plaintiff is concerned about what may happen to the documents. However the Plaintiff is not bereft of remedies. The High Court Rules exist to regulate the procedure for civil matters in order to do justice between the parties. That includes the making of appropriate interlocutory orders and, where necessary, the expedition of an action to finality. For instance Order 29 Rule 2 empowers the Court to make an order for the detention of any property pending trial, Order l4 provides for summary judgment procedures and Order 3 provides for abridgement of time. In appropriate cases advantage should be taken of such Rules to ensure that justice is done.

For the reasons given the application is refused.

JUSTICE D.B. PAIN

HBC0290D.94S