Bale v Fiji Fish Company Ltd No 1 [1998] FJHC 124; Hba0146d.1997s (17 August 1998)

Fiji Islands - Bale v The Fiji Fish Company Ltd No. 1 - Pacific Law Materials

IN THE HIGH COURT OF FIJI

AT SUVA

CIVIL JURISDICTION

CIVIL ACTION NO. 146 OF 1997

BETWEEN:

WAISAKE BALE
PLAINTIFF/Respondent

AND:

THE FIJI FISH COMPANY LIMITED
DEFENDANT/Applicant

Mr. R.I. Kapadia for the Plaintiff
Mr. M. Young for the Defendant n>

DECISION

This is the defendant company's application for an order for setting aside default judgment entered herein on 10 June 1997.

Background facts

This was a personal injuries claim for damages arising out of an accident which happened on the Defendant Company's fishing vessel 'SAN ANTONE' on or about 27 May 1996 when the plaintiff was preparing food for the crew members on the said vessel allegedly in the course of his employment with the defendant company (the "defendant") and the gas exploded causing fire. The plaintiff received injuries as a consequence.

The Writ of Summons was issued on 22 August 1997 and in default of acknowledgment of service default judgment was entered against the defendant on 10 June 1997. On 15 December 1997 Summons to fix date for hearing of assessment of damages was issued and served on the defendant. It was then that the defendant made the present application to set aside default judgment.

It is clear from Ms. Chan's affidavit filed on behalf of the defendant that the defendant after service of the Writ on 23 April 1997 referred the matter to its insurers to attend to instead of complying with the Rules of Court as to filing of Defence etc. Neither the defendant nor the insurer took any steps after the service of the writ.

Consideration of the issue

I have written submissions from both Counsel on this application.

Setting aside is a discretionary matter for the Court.

Mr. Kapadia referred the Court to a Papua New Guinea case of BARKER v THE GOVERNMENT OF PAPUA NEW GUINEA & OTHERS (1976) P.N.G.L.R. 340 where SALDANHA J. laid down that a judgment regularly obtained will not be set aside, as a matter of practice, unless the following conditions are fulfilled:-

(1) There must be a reasonable explanation why judgment was allowed to go by default.

(2) The application must be made promptly and within a reasonable time.

(3) There must be an affidavit stating facts showing a defence on the merits.

Mr. Kapadia submitted that law in Fiji is also the same.

I accept the above criteria and deal with the issue before me in the same order.

Firstly, on the question of why the judgment was allowed to go by default, it is a matter which the Court has to consider before it exercises its discretion. There is no strict rule requiring the defendant to give a reasonable explanation as to why judgment was allowed to go by default. This is what LORD ATKIN in EVANS & BARTLAM (1937) 2 ALL E.R. 646 at p650 has to say on this aspect:

"I do not think that any such rule exists, though obviously the reason, if any, for allowing judgment and thereafter applying to set it aside is one of the matters to which the court will have regard in exercising its discretion."

The High Court Rules provide for time within which certain steps are to be taken after service of Writ. Order 13 rule 2 provides as follows:

"Where a writ is endorsed with a claim against a defendant for unliquidated damages only, then, if that defendant fails to give notice of intention to defend, the plaintiff may, after the prescribed time, enter interlocutory judgment against that defendant for damages to be assessed and costs, and proceed with the action against the other defendants, if any."

The Writ herein was served on the defendant on 23 April 1997 and interlocutory judgment for assessment of damages was entered on 10 June 1997 and served on the defendant on 25 June 1997. Messrs. Howards, solicitors were instructed on 3 July 1997 to act for the defendant. There was communication between the solicitors when Howards indicated that they will apply to set aside the default judgment but the application was not made until 6 April 1998 which is nearly ten months after they became aware of the judgment.

The explanation given for delaying action is that the defendant referred the writ to its insurers. This is no explanation at all when endorsement on the writ is quite clear as to what steps should be taken after service. Mr. Grahame Southwick the Managing Director of the defendant is well versed with these matters and he cannot show ignorance.

For these reasons I find that the defendant has not given a reasonable explanation as to why judgment was allowed to go by default.

Secondly, one has to consider whether the application was made properly and within a reasonable time; it is clear it was not. Even Howards took far too long to take steps after making it known to the respondent's solicitors that they will make an application to set aside. There is no excuse for such a long delay. Why should the Respondent wait so long for appellant to move the Court. The longer the matter takes to finalize the Plaintiff is suffering. Mr. Young of Howards was aware that from 14 January 1998 their case was set down for hearing for assessment on 16 April 1998. Why no action was taken before 16 April 1998 has not been explained.

On the aspect of applying to set aside within a reasonable time Halsbury's Laws of England Vol 22 3rd Ed. on page 789 under para. 1688 has this to say:

"When the judgment or order in default of appearance or defence is regular the application to set it aside should be made as soon as possible after it comes to the knowledge of the defendant."

Even The High Court Rules Or. 2 r4.2 provides as follows on this subject:

"An application to set aside for irregularity any proceedings, any step taken in any proceedings or any document, judgment or order therein shall not be allowed unless it is made within a reasonable time and before the party applying has taken any fresh step after becoming aware of the irregularity".

I therefore conclude that this application was not made promptly and within a reasonable time.

The third aspect to be considered is whether there is a defence on the merits.

Mr. Kapadia submits that there are no merits in the proposed defence. He says that the matters raised, inter alia, go to quantum of damages. They are not defences as such. He refers to DUMMER v BROWN & ANOR (1953) 1 All E.R. 1158 C.A. which is a case in point. The following passage from DUMMER (supra) at p 1159 is pertinent:

It used to be taught that one object of the pleading was to let the other side know what your case was. That practice may not have been followed at all times. It certainly could be said of this defence (which was not settled by counsel for the defendant) that it tells no one anything. It puts everything in issue except that the coach was on the highway and no one can tell from the defence what case the defendant will put forward at the trial or what the issues are. It may be said, as counsels for the defendants argued, that the defendants were saying: "The onus is on the plaintiff. Let her prove her case. We are entitled to put everything in issue. That is what they did.

The Court of Appeal held that it was not sufficient.

Singleton, L.J. said on p.1164, marginal letter E-F:-

"Looking at the substance of the matter, it seems to me to be reasonably plain that, in truth, there is no defence on the issue of liability, and, if there is no defence, then it seems to me eminently desirable that costs should be saved by going straight to the issue of the quantum of damages."

In the Supreme Court Practice 1997 (vol. I) at p 143 are set out the principles upon which a Court acts on an application to set aside a judgment that has been regularly entered. It states:

"On the application to set aside a default judgment the major consideration is whether the defendant has disclosed a defence on the merits, and this transcends any reasons given by him for the delay in making the application...."

This principle has been followed in many cases. In BURNS v KONDEL (1971) 1 Lloyd's L.Rep.554 at p.555 Lord Denning said:

"We all know that in the ordinary way the Court does not set aside a judgment in default unless there is an affidavit showing a defence on the merits. That does not mean that the defendant must show a good defence on the merits. He need only show a defence which discloses an arguable or triable issue."

Also in the case of THE FIJI SUGAR CORPORATION LIMITED AND MOHAMMED ISMAIL (Civ. App. No.28/87 F.C.A. at p.9) it was stated that the Defendants only have to "establish a prima facie defence" and that a "draft defence is not necessary, what is required is the affidavit disclosing a prima facie defence."

Although I am not required to resolve the issue raised by the defendant I am not satisfied that the proposed defences are meritorious but bearing in mind the authorities I refer to hereafter the defendant could be given its day in Court in the interests of justice.

There is no doubt that the Defendant has delayed in making the application. However, Evans v Bartlam (1937) 2 All E.R. 656 at p.656 states that the court while considering delay, have been "lenient in excluding applicants on that ground" and further states that:

"The primary consideration is whether he had merits to which the court should pay heed; if merits are shown the Court will not prima facie desire to let a judgment pass on which there has been no proper adjudication."

Also as Atwood v Chichester [1878] UKLawRpKQB 4; 3 Q.B.D 722 and other cases show:

"the Court while considering delay, have been lenient in excluding applicants on that ground. The Court might also have regard to the applicant's explanation why he neglected to appear after being served, though as a rule his fault (if any) in that respect can be sufficiently punished by the terms as to costs or otherwise which the Court in its discretion is empowered by the rule to impose. The appellant here has an explanation, the truth of which is indeed denied by the respondent, but at this stage I see no reason why he should be disbelieved on what appears to me to be a mere conflict on affidavits."

In considering this application, the interest of the Plaintiff must also be given due consideration. The Plaintiff is unemployed and leads a miserable life. Why should he have to suffer for the defendant's inaction?

The following passage from Davies v Pagett (1986) 10 FLR 226 quoted in the judgment of Miles C.J. in Ryan v Adams (1993) 112 FLR 474 at 477 further highlights the duty of the Court in cases such as this:

"The fundamental duty of the Court is to do justice between the parties. It is, in turn, fundamental to that duty that the parties should each be allowed a proper opportunity to put their cases upon the merits of the matter. Any limitation upon that opportunity will generally be justified only by necessity to avoid prejudice to the interests of some other party, occasioned by misconduct, in this case, of the party upon whom the limitation is sought to be imposed."

For these reasons I order that the default judgment be set aside conditional upon the defendant paying into Court the sum of $20,000.00 within 21 days of this decision. This amount when paid shall be put on Term Deposit with a bank by the Chief Registrar. In the event that such an amount is not paid this application to set aside judgment shall stand dismissed which means that the judgment shall remain standing. The Statement of Defence is ordered to be filed within 21 days from the date of this decision. The defendant is further ordered to pay costs of this application in the sum of $200.00 within 7 days from the date hereof.

D. Pathik
Judge

At Suva
17 August 1998

Hba0146d,97s