Ali v Westpac Banking Corporation [1997] FJHC 168; Hbc0457d.97s (10 November 1997)

Fiji Islands - Ali v Westpac Banking Corporation - Pacific Law Materials

IN THE HIGH COURT OF FIJI

AT SUVA

CIVIL ACTION NO. 0475 OF 1997S

p class=MsoNormal amal align=center style=text-align:center>BETWEEN:

ISLAM ALI
(f/n Amzad Ali)
Plaintiff

AND:

WESTPAC BANKING CORPORATION
Defendant

S. Chandra for the Plaintiff
J. Howard for the Respondent

DECISION

On 5 November 1997 I dismissed this application and I now give my reasons.

On 29 October 1997 the Plaintiff commenced the proceedings by filing his writ. The subject matter of the Action is a property mortgaged to the Defendant and the principal relief sought is an injunction restraining the Defendant from exercising its powers of sale pending the determination of the Action. It is not at all clear from the Statement of Claim what substantive legal right said to be enjoyed by the Plaintiff is alleged to have been breached by the Defendant.

On the same day the writ was filed the Plaintiff also filed an ex parte application for the injunction sought in the Statement of Claim. The Notice of Motion was dated 23 October, 6 days earlier, as was the supporting affidavit, the oath date being subsequently altered to the 29th. There is nothing to show that the affidavit was re-sworn after it was altered.

On the day the application was filed I directed that it proceed to hearing inter partes on 5 November. Notwithstanding this direction and receipt of it on the day it was made (as confirmed by Mr. Chandra) the Plaintiff chose not to serve the Defendant with the papers until 3 November, only one clear day before the hearing of the application. Such delay in serving the Defendant is quite unacceptable. Whether by design or not the effect of such a delay is to embarrass a Defendant who is not afforded adequate opportunity to file evidence in answer to the supporting affidavit and who is usually therefore forced to seek an adjournment while conceding an interim injunction or is pressured into offering an undertaking. Given the state of the Courts business it is not always easy to find an early date for the adjourned hearing.

Where, as in this case, the original application was filed ex parte the delay in serving the document on the Defendant is even more inexcusable. If the Notice of Motion and supporting affidavit were ready to be filed on 23 October there can have been no excuse for resorting to the ex parte procedure 6 days later. This procedure is only allowed by O.29 r.1(2) in exceptional cases of urgency coupled with irreparable mischief. Once a direction had been given by the Court to serve the other side the Plaintiff should have immediately complied, and not delayed until one working day before the hearing.

In the event, given the nature of the application and the papers filed I did not in fact find it necessary to adjourn but my remarks are intended to give fair notice that this kind of slipshod approach is not good enough.

Returning to the application itself, as has been repeatedly emphasised by this Court the law in Fiji is that save in the most exceptional circumstances, failing payment into Court of the amount claimed, a mortgagee will not be restrained from exercising its power of sale (see e.g. Deo Narayan v Ram Raji HBC 0077/94S). No offer or payment in has been forthcoming from the Plaintiff.

Mr. Chandra who, at very short notice, made a valiant effort on behalf of the Plaintiff conceded this difficulty but put his client’s case in another way. He suggested payment in did not arise since the mortgagee, who it was accepted had entered into a sale and purchase agreement in respect of the property, had not actually sold it and accordingly, under the provisions of Section 72 of the Property Law Act (Cap. 130) the mortgagor was entitled to redeem. Mr. Chandra referred to Annexure L of the supporting affidavit, a letter from Habib Bank agreeing to redeem on behalf of the Plaintiff and therefore submitted that the mortgagee Defendant should be restrained from selling the property.

Mr. Chandra also advanced a second argument. Relying on Jai Narayan v. Mohammed Dean (FCA Reps 86/273) and referring to Annexures I and J of the supporting affidavit he submitted that it was clear that the mortgagee was proposing to sell the property at significant under-value and accordingly the sale should be stopped.

In answer, Mr. Howard, whom I allowed to tell me from the Bar table that he had in his hand a copy of the completed sale and purchase agreement, relied on two authorities. As an aid to interpreting Section 72 he pointed to Section 81(1) of the New Zealand Property Law Act 1952 and cited Hawson v Little [1948] NZLR 1073. He suggested that once a binding sale and purchase agreement had been entered into the property had been “sold” within the meaning of Section 72. I agree. It is also worth noting that although the mortgagee gave clear warning to the Plaintiff on 2 October that it had reached agreement with a purchaser for the property and was about to settle, solicitors for the Plaintiff did not reply until 17 October by which time settlement had already taken place (see Annexures D, E and G of the supporting affidavit).

As to the allegation of undervalue, while I accept that a mortgagee owes a mortgagor a duty of care when exercising its powers of sale, first, there is no Action pending before this Court alleging a breach of such duty and secondly, it is perfectly clear that a Court will only interfere to restrain completion of a conveyance in such circumstances (a) if the moneys due under the mortgage are tendered by the mortgagor and (b) if the Court is satisfied that the mortgagee has not acted in good faith (see Property and Bloodstock Ltd v Emerton [1968] Ch. 94).

Mr. Howard told me that his instructions were that the valuation exhibited to the supporting affidavit was not accepted as being bona fide. The allegation of undervaluation was rejected. There was, in any event, no good reason to prevent this sale proceeding. The Plaintiff who resided overseas and who had so far failed to file any evidence himself was not losing a property of special emotional significance to him and, in the unlikely event that the Action was eventually determined in his favour then he could adequately be compensated in damages. I agree with these submissions.

In my view the Plaintiff by his own procrastination is the principal author of his own misfortune. I do not believe that intervention by the Court at this stage can be justified. It is for these reasons that I dismissed the application.

M.D. Scott
Judge

10 November 1997

Hbc0457d.97s