Eyre v Estate Management Services Ltd [1997] FJHC 234; Hbc0407d.92s (26 September 1997)

IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION

CIVIL ACTION NO. 407 OF 1992

Between:

PETER GERVAISE JOSEPH EYRE
Plaintiff

and

ESTATE MANAGEMENT SERVICES LIMITED
Defendant

and

MINAMI TAIHEYO KAIHATSU KABUSHIKI KAISHA
Third Party

Mr. P. Knight for Plaintiff
Mr. S. R. Valenitabua for Defendant
Mr. G. P. Lala for Third Party

DECISION
(On applications for stay)

There are two separate applications by the Defendant and Third Party seeking a stay of execution of a judgment delivered by me herein on 30 April 1997 pending the hearing and determination of an appeal against the judgment so entered.

The judgment reads:

"For these reasons the Plaintiff succeeds in his claim. There will therefore be judgment for the Plaintiff against the Defendant in the sum of £30,625.00 together with interest thereon at the rate of 7% per annum from 30th September 1991 to the date of this judgment and costs which is to be taxed unless agreed. There will also be a declaration that Third Party indemnify the defendant in the amount of the said judgment against the defendant and interest as well as costs in the third party proceedings to be taxed if not agreed."

Whilst opposing the application, Mr. Knight for the Plaintiff says that if the Court is minded to grant a stay then he would ask that moneys be paid into Court and that the Appellants prosecute the Appeals with vigour so that they could be heard early in the 1998 Sessions with liberty to come back and seek a review.

The Defendant's counsel submits that it would cause prejudice to it if stay is refused. If the Third Party is granted an order for a stay the indemnity enjoyed by the Defendant by virtue of the Order will be ineffective thus exposing the Defendant to the possibility of the execution of the Judgment against it. The amount involved in the judgment is substantial and if it is paid and the Third Party is successful then the recovery of the amount would be difficult.

Looking at the grounds of appeal shown to me during the hearing, what chances the defendant has of succeeding on appeal it is difficult for me to say; there are two grounds which in substance state that the court was "wrong" in coming to the decision it came to and in making an order for the amount stated therein. The defendant was out of time in appealing and I am informed that it has already obtained leave to appeal from the Fiji Court of Appeal.

As for the Third Party, it has appealed in time and has complied with the Order for "security for costs".

Mr. Lala says that the Company is a substantial company and there is no likelihood of judgment not being satisfied if the appeal is not successful. The court was referred to the relevant principles applicable to an application of this nature.

Consideration of the issue

It is the general rule that when a party exercises its undoubted right of appeal, the Court should ensure that the appeal if successful is not rendered nugatory. (See WILSON v CHURCH (No. 2) [1879] UKLawRpCh 233; (1879) 12 Ch. D. 454 at 458).

It is well established by authority that the discretion to order a stay of proceedings is only to be exercised where special circumstances exist which justify departure from the ordinary rule that a successful litigant is entitled to the fruits of his litigation pending the determination of any appeal (vide The ANNOT LYLE [1886] UKLawRpPro 31; (1886) 11 P.D. 114 at p.116, SCARBOROUGH v LEW'S JUNCTION STORES PTY LTD [1963] VicRp 20; (1963) V.R. 129 at p.130). The test applied by ADAMS J in SCARBOROUGH (supra) at p.130 is "whether there is a real risk that the appeal would prove abortive if the applicant were not granted a stay".

In the granting of an order for stay the Court has "an absolute and unfettered discretion". (Halsbury's 4th Ed. Vol 17 para 455).

Examples of situations where appeal could be rendered nugatory is stated by DAWSON J in THE COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA AND THE MYER EMPORIUM LIMITED [1986] HCA 13; (1986) 160 CLR 220 at p.223 as follows:

"Generally that will occur when, because of the respondent's financial state, there is no reasonable prospect of recovering moneys paid pursuant to the judgment at first instance. However, special circumstances are not limited to that situation and will, I think, exist where for whatever reason, there is a real risk that it will not be possible for a successful appellant to be restored substantially to his former position if the judgment against him is executed: see McBride v Sandland [No.2] [1918] HCA 59; (1918) 25 C.L.R. 369 at p. 375."

The most important thing to bear in mind is as stated in the headnote to LINOTYPE-HELL FINANCE LTD v BAKER (1992) 4 All E.R. 887 which states:

"Where an unsuccessful defendant seeks a stay of execution pending an appeal to the Court of Appeal, it is a legitimate ground for granting the application that the defendant is able to satisfy the court that without a stay of execution he will be ruined and that he has an appeal which has some prospect of success. The old rule that a stay of execution would only be granted where the appellant satisfied the court that if the damages and costs were paid there would be no reasonable prospect of recovering them if the appeal succeeded is now far too stringent a test and does not reflect the court's current practice (see p 888 f to h, post)."

Although Mr. Knight objects to the application, when asked by Court, he said to the effect that he does not doubt the ability of the applicants to satisfy the judgment but that is not in issue except that, as I understand him, the Plaintiff should be able to enjoy the fruits of the action.

It is pertinent to note here that the Plaintiff resides in England and most of the directors of the defendant and Third-Party Companies are overseas. The decision that I propose to make has to be made with the residential status of the parties in mind.

I have also taken into account the Grounds of Appeal, particularly that of the Third Party, which raise serious questions for determination. I have already commented on the defendant's Grounds hereabove. The Applicants are entitled to have the issues they raise determined by the Appellate Court. I am not too concerned about the chances of their success for the purpose of this application.

Bearing in mind the submissions made by counsel and the principles applicable in an application for stay, in the exercise of my discretion, in all the circumstances of this case I will grant a stay upon the execution of the judgment on condition, namely, that the Defendant and Third Party each of them pay into Court half the amount of the principal sum under the Judgment into Court (without interest that has been ordered) within 28 days of this decision to be held by the Chief Registrar until the hearing and determination of the Appeals or further order. The Chief Registrar is directed to place the said sum deposited into Court on interest bearing term deposit initially for a period of six months and thereafter at three-monthly intervals should it be necessary. It is further ordered that the Appellants take all reasonable steps to expedite the appeals.

The Applicants are each ordered to pay the costs of this application which is to be taxed unless agreed.

D. Pathik
Judge

At Suva
26 September 1997

HBC0407D.92S