Mobile Crane Hire Services Ltd v BW Holdings Ltd [2007] FJHC 86; HBF 49.2007 (19 December 2007)

IN THE HIGH COURT OF FIJI
AT LAUTOKA
CIVIL JURISDICTION

Civil Action No : HBF 49 of 2007

BETWEEN:

MOBILE CRANE HIRE
SERVICES LIMITED
Plaintiff

AND:

B.W. HOLDINGS LIMITED
Defendant

Counsels: Ms N. Khan for the Petitioner
Mr. A. Patel for Sherani & Co. for the Company
Ms N. Khan for Sinclair Knight for Supporting Creditor

Date of Hearing: 17th October 2007
Date of Judgment: 19th December 2007

JUDGMENT

BACKGROUND:

[1] Mobile Crane Hire Services Limited has filed a winding up petition against B.W. Holdings Ltd. (the Debtor Company). The petition is supported by another creditor Sinclair Knight Merz which alleges that a sum of $117,954.00 is owed to it. The amount claimed in the petition is $54,500.00 for services rendered. The nature of services rendered was dredging of 20,000 cubic meters of silt. The document I believe erroneously says 20,000 cubic centimeters.

THE SUBJECT MATTER – CONTRACT:

[2] The entire text of the agreement reads:

"We hereby submit our quotation to Dredge 20,000cm3 silt and sand at Denarau. Our price shall be $4.00cm3.

The above price is based on 14 weeks thereafter $2,500.00 per week shall be charged.

Mobilization and Demobilization shall be charged $1,500.00.

Supply of Barge, Insurance and security shall be your care.

Operator’s transport shall be charged $60.00 per week."

[3] The quotation is self-explanatory. It is also apparent from the affidavits that the parties conducted themselves in accordance with this quotation so the provisions of the quotation became the terms of their contract as they were adopted as such.

DISPUTE AS TO HOW MUCH WORK DONE:

[4] The quotation is dated 13th December 2005 so the works must have commenced round about this time. The agreement does not say if work was to be done for fourteen consecutive weeks. Attached to the affidavit of Saten Prasad are the weekly work dockets. These dockets commence from 23rd November 2005 that is some twenty days prior to the quotation. On what basis the petitioner says that work done prior to the quotation formed part of the fourteen weeks, I cannot say, as no explanation has been given.

[5] These weekly work dockets do not assist the petitioner much as the price to be paid was by volume and not number of hours spent. For the first fourteen weeks, payment was by volume. The Debtor Company says the volume of de-silting done was 9,000 cubic meters. The petitioner has not produced any documents to counter that saying that this evidence must be with the company. This is the central material fact – the volume of silt removed. There is also some uncertainty as to whether fourteen weeks of work had in fact been done. It is only upon completion of the fourteen weeks of work that the flat rate of $2,500.00 per week would come into effect.

LAW ON DISPUTE ON SUBSTANTIAL GROUNDS:

[6] The law is clear that there is discretion in a court seized of a winding up petition to decline to hear the petition where the debt is contested on substantial grounds. Offshore Oil N.L. v. Investment Corporation of Fiji Ltd. 30 FLR 90. A petition for winding up with a view to enforcing a disputed debt is an abuse of process of court and should be dismissed with costs: In the matter of Silimaibau Sunset Express (Fiji) Ltd. Winding up 40 of 1996. Substantial means having substance and not frivolous. It is for the Company to bring forward a prima facie case to satisfy the court that there is something material which ought to be tried by oral evidence. If a company bona fide disputes a debt then it has not "neglected to pay" the debt as contemplated by Section 221(a) of the Companies Act: Re: London and Paris Banking Corporation – (1874) 19 L.R. (Equity) 444.

CONCLUSION:

[7] I am of the view that there is substantial dispute on the material facts. Accordingly I dismiss the petition but I make no order as to costs as it was only after the petition was fixed for hearing that the company paid $10,500.00 to the petitioner.

[ Jiten Singh ]
JUDGE

At Suva
19th December 2007