Todd v Bayside (South Pacific) Ltd [1996] FJHC 163; Hbc0405.94s (29 November 1996)

IN THE HIGH COURT OF FIJI
(AT SUVA)

CIVIL ACTION NO. HBC 405 OF 1994S

BETWEEN:

HARRY TODD and LILLY GENE TODD
Plaintiffs

and

BAYSIDE (SOUTH PACIFIC) LIMITED
1st Defendant

and

JOHN WRIGHT
2nd Defendant

Sir Vijay R. Singh for the Plaintiffs
A.H.C.T. Gates for the Defendants

JUDGMENT

On about 29 April 1994 a game fishing launch "Lilly G III" owned by the Plaintiffs sank while anchored at the Royal Suva Yacht Club. A writ was issued the following August in which the Plaintiffs claimed that the accident was caused by the failure of the Defendants to install a self priming automatic bilge pump into the launch.

On 7 September 1995 this Court Ordered by consent that the Action be referred to a special referee namely Miles Granger Johnson Esq. under the provisions of RHC O 36 r2. Mr. Johnson delivered his Report on 3 September 1996. He found in favour of the Plaintiffs and awarded them the sum of $45038.89 as special and general damages. He also awarded interest at the rate of 12% from 30 April 1994 until payment. Sir Vijay now moves the Court for an Order that the Report be accepted under the provisions of O 36 r 3 (3) (a).

Mr. Gates asks that the Award be varied under the provisions of O 36 r 3 (3) (b). His concern is the rate and period in respect of which interest was awarded.

Mr. Gates first submits that since the Plaintiffs' letter of demand prior to commencement of proceedings was dated 23 May interest should only accrue from that date, not the date of the sinking. With respect, I disagree. While it is clear that a claim for interest must be specifically pleaded (see Tacirua Transport v Vinod Chand FCA Reps 94/67) and was indeed here so pleaded (see paragraph (c) of the prayer of the Statement of Claim) the Court has power to award interest at a reasonable rate from the date the cause of action arose until Judgment (see Law Reform (Misc. Provisions) (Death and Interest) Act - Cap 27 - Section 3). Here the cause of action arose on the day the Lilly G III sank and therefore 30 April is the proper commencement date.

Mr. Gates' second objection is to the rate awarded. He submitted, citing Nebulite Aluminium Ltd v Padarath Suva HC 228/88 that the proper rate was 4%. I disagree in part. It is important to distinguish between interest which may be awarded for the period which runs from the date of the cause of action to Judgment and the period which runs from Judgment to payment. Different considerations and legislation apply to the two periods. The first period is governed by Cap 27 (and see also Queensland Insurance (Fiji) Ltd v Prasad FCA Reps 90/46) whereas the second period is governed by Section 17 of the (Imperial) Judgments Act 1838 ( see Suresh Charan v SCC FCA Reps 89/102 and John Byrne v J.S. Hill and Associates FCA Reps 94/385).

In regard to the first period the rate awarded which is supposed to reflect what it would have cost the Plaintiff to borrow the sum owed has during recent years varied between 10 and 13.5% as interest rates have fluctuated. I was told from the bar table that no argument was addressed to Mr. Johnson as to the proper rate. I am not satisfied that he erred in awarding 12%.

The second period is unfortunately still fixed at 4% since the 1838 Act has not been amended insofar as it applies to Fiji. I am not certain what the current Judgment Act rate is in England but in 1988 it was 15%. This appears to be a matter for the Law Reform Commission . The rate between the dates of Judgment and payment must be varied from 12% to 4% and to that extent only the application to vary the Report succeeds. Subject to this variation I adopt Mr. Johnson's excellent Report as a Judgment of this Court.

M.D. Scott
JUDGE

29 November, 1996.

HBC0405.94S