Kumar v Kumar [2003] FJHC 247; HBC0033d.2003S (14 August 2003)

IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION

CIVIL ACTION NO. HBC0033 OF 2003

Between:

HEMANT KUMAR
f/n Bans Raj
Plaintiff

and

SURESH KUMAR
f/n Bans Raj
WESTPAC BANKING CORPORATION
RAMAN PRATAP SINGH
f/n Ram Jati Singh
REGISTRAR OF TITLES
Defendants

Mr. G. P. Lala for the Plaintiff
Mr. V. Maharaj for the 1st Defendant
Mr. A. Bale for the 2nd Defendant
Mr. Y. Singh for the 4th Defendant

DECISION

This is the first (D1) and second (D2) defendants’ application by summons to strike out the plaintiff’s Statement of Claim as disclosing no reasonable cause of action against them pursuant to Or.18 r18(1)(a) of The High Court Rules 1988.

As ordered, written submissions have been filed by D1 and D2 but not by the fourth defendant (D4) who is only a nominal defendant.

I have considered the legal submissions made by counsel.

First defendant’s submission

The first defendant submits that the pleadings do not disclose a reasonable cause of action against him. The plaintiff knew that the Mortgage instalments had been defaulted and D2 was proceeding towards Mortgagee sale but the plaintiff failed to act there and then. The Defendant not being an agent, occupier or tenant of the property properly submitted the tender of the property which was accepted in good faith by D2. The property has been properly and legally transferred to D1 and in the absence of fraud which is specifically and properly not pleaded herein, D1 is the proprietor of an indefeasible title.

The D1 says that his action has not been fraudulent against the Plaintiff, hence the Plaintiff’s claim does not disclose a reasonable cause of action against D1.

Second defendant’s submission

The second defendant contends that the plaintiff does not have a cause of action against it. Counsel submits that D2 does not owe the plaintiff the duty of care as alluded to by the plaintiff and hence D2 cannot be held to carry out the duties as pleaded by the plaintiff.

Counsel states in his written submission the law in regard to mortgagee and mortgagor relationship. The mortgagee (D2) acted in good faith throughout the ‘mortgagee sale’ proceedings. The D2 in advertising the subject property awarded the tender in good faith to a ‘total stranger’ and there is no suggestion of any fraud or recklessness.

The plaintiff’s response

Counsel for the plaintiff submits that D2 had breached a number of duties required of it, namely, failure to act in good faith when exercising its power of sale, failure to obtain true market value of the property and failure to act fairly as a mortgagor.

In view of these alleged breaches counsel submits that the statement of claim does disclose a cause of action against the defendants and the mere fact that the case is allegedly weak and not likely to succeed is no ground for striking out the action.

Consideration of the issue

Background facts

As ordered, counsel representing the plaintiff, the first and second defendants filed written submissions for my consideration.

The plaintiff commenced this action after his property was sold under a ‘mortgage sale’ by the second defendant. It was sold to the first defendant who is the brother of the plaintiff. The third defendant acted as the solicitor for D1 as well as for the plaintiff but it is alleged that he failed to act in the plaintiff’s interest. It was the plaintiff who engaged him to act as his solicitor in this matter. The D4 who is only a nominal defendant has been excused from further proceedings.

The law

Counsel have in their written submissions clearly set out the law governing the subject of ‘reasonable cause of action’.

These applications are made under Or.18 r.18(1)(a) of the High Court Rules 1988 which provides:

18(1) The Court may at any stage of the proceedings order to be struck out or amended any pleading or the indorsement of any writ in the action; or anything in any pleading on the ground that –

(a) it discloses no reasonable cause of action or

defence, as the case maybe; or

(b) .....
(c) .....
(d) .....
(e)

On the facts and circumstances of this case I apply the following principles of law: “it is not the practice in the civil administration of our Courts to have a preliminary hearing, as it is in crime” (per Sellers L.J. in Wenlock v Moloney & Others [1965] 1 W.L.R. at p.1242). As stated in the Notes to Or.18 r.19 in The Supreme Court Practice 1979 Vol I, 312 that: ‘it is only in plain and obvious cases that recourse should be had to the summary process under this Rule’ and that ‘it can only be adopted when it can be clearly seen that a claim or answer is on the fact of it obviously unsustainable’. (A.G. of Duchy of Lancaster v L. & N.W. Ry. Co [1892] UKLawRpCh 134; [1892] 3 Ch 274, C.A.). It cannot be said here that the action is one which cannot succeed or is in some way an abuse of the process.

Also, in the context of this case I find the following statement of Megarry V.C. in Gleeson v J. Wippell & Co. [1977] 1 W.L.R. 510 at 518 apt:

“First, there is the well-settled requirement that the jurisdiction to strike out an endorsement or pleading, whether under the rules or under the inherent jurisdiction, should be exercised with great caution, only in plain and obvious cases that are clear beyond doubt. Second, Zeiss No. 3 of [1970] Ch.506 established that, as had previously been assumed, the jurisdiction under the rules is discretionary; even if the matter is or may be res judicata, it may be better not to strike out the pleadings but to leave the matter to be resolved at the trial”.

The applicants’ main ground for striking out is that there is no ‘reasonable cause of action’ against them. The following notes to Order 18 r.19 of the Supreme Court Practice (U.K.) 1979 Vol 1 Or 18/19/11 on what is meant by the term ‘a reasonable cause of action’ sufficiently provide the answer to the applications.

“.......... A reasonable cause of action means a cause with some chance of success when only the allegations in the pleadings are considered (per Lord Pearson in Drummond Jackson v British Medical Association [1970] 1 WLR, 688; [1970] 1 All E.R. 1094 C.A.). So long as the statement of claim or the particulars (Davey v Bentinck [1892] UKLawRpKQB 216; [1893] 1 Q.B. 185) disclose some cause of action, or raise some question fit to be decided by a Judge or a jury, the mere fact that the case is weak, and not likely to succeed is no ground for striking it out (Moore v Lawson (1915) 31 T.L.R. 418, C.A.; Wenlock v Moloney [1965] 1 W.L.R. 1238 [1965] 2 All E.R 871, C.A.)...”

Similarly, Lindley M.R. in Hubbuck & Sons, Ltd v Wilkinson, Heywood & Clark Limited [1898] UKLawRpKQB 176; [1899] 1 Q.B. 86 at page 91 said:

“... summary procedure is only appropriate to cases which are plain and obvious, so that any master or judge can say at once that the statement of claim as it stands is insufficient, even if proved, to entitle the plaintiff to what he asks. The use of the expression “reasonable cause of action” in rule 4 shews that the summary procedure there introduced is only intended to be had recourse to in plain and obvious cases”.

In Attorney General v Shiu Prasad Halka [1972] 18 FLR 210 Marsack J.A. said of the predecessor to order 18, r.18 of High Court Rules at page 215:

“... I think it is definitely established that the jurisdiction to strike out proceedings under Order 18 rule 19 should be very sparingly exercised where legal questions of importance and difficulty are raised”.

The Fiji Court of Appeal in its decision of National MBf Finance (Fiji) Limited v Nemani Buli, (Civil Appeal No. ABU 0057 of 1998) very clearly enunciated and determined the principles for striking out. At page 2 of the judgment their Lordships said:-

“The law with regard to striking out pleadings is not in dispute. Apart from truly exceptional cases the approach to such applications is to assume that the factual basis on which the allegations contained in the pleadings are raised will be proved. If a legal issue can be raised on the facts as pleaded then the courts will not strike out a pleading and will certainly not to do so on a contention that the facts cannot be proved unless the situation is so strong that judicial notice can be taken of the falsity of a factual contention...”

Conclusion

Upon reading the pleadings, considering the submissions of counsels and the authorities referred to hereabove, I hold that the Statement of Claim discloses a reasonable cause of action raising issues of fact and law particularly duties of a mortgagee in a mortgagee sale as well as a solicitor’s duty acting for a client. A number of allegations have been made against the defendants. The plaintiff is entitled to bring the action. It is not an abuse of the process of the Court. However, the plaintiff has to prove his case on a ‘civil standard’ but this is not a case which calls for the striking out of the statement of claim.

The applications are therefore dismissed. Costs to be costs in the cause.

D. Pathik
Judge

At Suva
14 August 2003