Narayan v Public Employees Union [2009] FJHC 257; HBC161.2009 (24 November 2009)

IN THE HIGH COURT OF FIJI
AT LAUTOKA
CIVIL JURISDICTION

Civil Action No. HBC 161 of 2009

Between:

ADISH KUMAR NARAYAN
of Yalalevu, Ba, Legal Practitioner practicising
under the name and style of AK Lawyers.
Plaintiff

And:

PUBLIC EMPLOYEES UNION
a registered Trade Union under the Trade Union and the
Trade Union Recognition Acts (Cap 96 and 96A) and
having its officers at 73 Edinburgh Drive, Suva, Fiji.
Defendant

Before: Master Anare Tuilevuka

Counsel: Mr. C. B. Young for the Plaintiff
Mr. H. Rabuku for the Defendant

Date of Hearing: 12th November 2009
Date of Decision: 24th November 2009

RULING

Introduction

1. The Plaintiff, Mr. Adish Kumar Narayan ("Narayan") is a prominent Ba lawyer whose firm, AK Lawyers, was retained by the Defendant ("PEU") for several years during which time Narayan rendered various legal services to PEU. Before me is a summary judgment application of Narayan on his claim against PEU for unpaid legal fees and costs. The application is supported by an affidavit of Narayan filed on 01st October 2009. PEU has responded with the Affidavit of Viliame Kautia sworn on the 2nd day of November 2009 and filed the day after. On the 10th day of November 2009, Narayan’s Affidavit in Reply to the Affidavit of Viliame Kautia. I heard the application on the 12th day of November 2009.

Affidavit of Adish Kumar Narayan filed on 01st October 2009

2. This Affidavit of Narayan deposes that PEU is justly and truly indebted to his firm in the sum of $75,136.22 as at the 5th day of September 2009.

3. Narayan verifies the particulars in his Statement of Claim in paragraph 2 of his Affidavit. The Statement of Claim, filed on the 04th day of September 2009, alleges that Narayan’s firm had rendered various legal services to PEU. The claim further alleges that PEU had agreed with the rate for payment.

4. The Claim does not set out clearly when exactly PEU had agreed with Narayan’s rates. Were these quoted by Narayan to PEU at the outset or much later when Narayan rendered his Bill of Costs and Statements of Accounts to PEU?

5. In any event, it appears that PEU has paid Narayan some money towards settling fees and costs due.

6. Narayan pleads that some $68, 064.93 remains outstanding as at 24th October 2008. To this sum, he adds interest at 12% per annum from 24th October 2008 to 4th September 2008.

7. Annexed and marked "AKN-1" to Narayan’s Affidavit is a letter dated 5th September 2009 from his office to PEU attaching a Statement of Account of fees owing for various matters. The letter then encloses Narayan’s Memorandum of Costs totalling $96,607.47 in all PEU files. The letter then states: "Please note that the said payment has to be made by 4pm on 12th September, 2008 or we will have no option but to proceed with legal action to recover our costs".

8. Narayan also annexes to his Affidavit marked "AKN-2" and "AKN-3" two letters both dated 15th September 2008. AKN-2 is a letter from PEU signed by its then President, a Mr. Kautoga who (has since deceased) commits PEU to a first payment of $10,000 by Wednesday 17th September 2008, a second payment of $10,000 by Friday 26th September 2008, and weekly payments of $3,000 thereafter from 3rd October 2008 for the next 25 weeks or so until the debt is completed.

9. On my calculation, Kautoga’s commitment was to a debt of $96,500 to be paid by instalments.

10. AKN-3 is a letter also dated 15th of September 2008 by Narayan. The letter was addressed to Mr. Viliame Kautia, Acting General Secretary, Public Employees Union stating the following:

"We acknowledge receipt of your letters dated 8th September 2008 written to Gledvil Law copied to us and the National President’s letter of undertaking dated 15th September, 2008.

Please note that we accept the undertaking to settle our outstanding fees in the manner proposed and look forward to the first payment on 17th instant"

11. Narayan deposes that PEU then made some part payments but then failed to honour its undertaking to completion.

12. Annexed to his Affidavit and marked AKN-4 is a letter he wrote dated 9th of December 2008 to Kautia stating inter alia that "PEU has not complied with its undertaking of payment as per letter dated 15th of September, 2008". That is followed by a reminder that PEU owes a balance of $68,064.93 in fees outstanding and that if PEU did not settle it within seven days, Narayan would institute legal proceedings.

13. AKN-5 is another letter dated 20th February 2009 by Narayan to a Mr. Malakai Kaitu’u, SIRO, PRU in which Narayan again reminds Kaitu’u that some $68,064.93 remains outstanding in unpaid fees.

14. AKN-6 is a response dated 25th February 2009 by S. Tagilala & Co. Writing on PEU’s behalf. In that letter, S. Tagilala pleads with Narayan to "consider receiving monthly commitments from PEU effective immediately on flexible payment amounts due to inherent financial constraints". Notably, that letter was copied to Kautia.

15. In his response to S. Tagilala (annexure AKN-7), Narayan seeks clarification on "what exactly would be the monthly payments and the timeline for such payments".

Affidavit of Viliame Kautia

16. Mr. Kautia is the General Secretary of PEU. He assumed this role when his predecessor passed away. Upon assuming office, Kautia immediately embarked on reforming the PEU management. One of the first things he did was to engage a new lawyer. He states in his Affidavit that PEU could no longer retain Narayan as Narayan had started representing the state in various matters which conflicted with Narayan’s position with PEU.

17. According to Kautia, there was a period in-between the time PEU severed its ties with Narayan and before it was able to engage another lawyer, when PEU was basically carrying on business without the benefit of legal advice or guidance or legal representation.

18. It appears from the tone of Kautia’s affidavit that this "transitional period’ as he calls it should be considered by this court when assessing the actions of Mr. Kautoga (see paragraphs 8 and 9 above) and S. Tagilala & Co. (see paragraphs 14 &15 above)) who had unwittingly committed PEU to the amount on Narayan’s Bill of Costs without scrutiny and clearly when it was not within their powers to do so under the PEU Constitution.

19. Kautia denies he was ever issued "with the invoices for each amount due on each case". He says at paragraph 7 of his Affidavit that PEU did:

"not have an update on the status of each case and a detail of all of our instructions to indicate how much work he has done. Until today, we have engaged GLEDVIL LAW to attend to some of the matters that he is claiming costs on. Furthermore, all our case files have not been returned to my office until today despite several requests to the Plaintiff. I am not in a better position to agree with his bills when I do not have access to the case files that belongs to the Union in the Plaintiffs possession".

20. In paragraph 9 of his Affidavit, Kautia admits receiving AKN-4, but insists that he was not properly invoiced. He is adamant that the fees claim has not been properly explained or justified. He also deposes that AKN-5 was not addressed to him and adds that S. Tagilala & Co. was not authorised "to make financial commitments to service providers of PEU".

Narayan’s Affidavit in Answer

21. Narayan’s Affidavit in answer to Kautia’s Affidavit was sworn on 10th November 2009 and filed on the same day. Notably, he deposes that it was his office that had severed its ties with PEU because of the outstanding fees and not vice versa as Kautia would have this Court believe. He says that Kautia had called him on several occasions in his office in Ba and pleaded with him to carry on working for PEU.

22. Narayan attaches to his Affidavit marked AKN-8 and AKN-9 respectively a letter he wrote dated 25th August 2008 to PEU to that effect, and a letter dated 8th September 2008 by Kautia to Gledvil Lawfirm which states inter alia as follows:

"You are hereby instructed to represent Public Employees Union only in the above cases as per the above subject since our Solicitor and Legal Advisor AK Lawyer and Associate has informed us that they are not able to represent us as per the above cases unless a lump sum down payment is made to them which we are not able to do at this point in time"

23. Narayan attaches to his Affidavit in Answer (annexure AKN-11) invoices for all outstanding payments that were rendered to PEU as at 31st August 2008.

24. Narayan then deposes that Kautia had personally called into his Ba office on 17th September 2008 and paid $10,000 and then collected two files. Kautia also sent to his office the following week another cheque to the sum of $10,000 but then advised Narayan not to bank it as there were no funds in the Account. Kautia was to advise Narayan later when to bank the cheque.

25. Narayan also deposes that Kautia subsequently made arrangements for payments of $3,000 on 17th October 2008 and on 24th October 2008.

Consent Judgement in the Sum of $39,000

26. At this point, it must be noted that in the course of arguments before me, Mr. Rabuku produced in Court a letter of 29th July 2008 written by Kautia (without any objections by Mr. Young) which states the following:

"I understand PEU owes a substantial amount of $39,000 to your firm for your services and it has been accumulating over the years.

"As the new Acting General Secretary after the passing away of the late MR Pita Delana, I would like to assure you that we are committed to clearing our outstanding dues on a weekly payment of $750.00"

27. On the basis of the above letter, and Mr. Rabuku confirming so verbally in Court, judgement by consent to the sum of $39,000 was entered against PEU from 29th July 2008.

Issues

28. What I then have to decide now is whether:-

(i) Narayan has proved his claim for the balance

(ii) PEU is able to set up a bona fide defence or raise an issue against the claim which ought to be tried.

Principles for Summary Judgment

29. Where there is no defence to a claim, or where any defence raised will merely have the effect of delaying judgement, the summary judgment procedure under Order 14 is available for the Plaintiff who wants to obtain a quick judgment and avoid delay and the expense of a full trial.

30. The task of the court is to determine whether there ought to be a trial.

31. The Court of Appeal in Carpenters Fiji Ltd –v- Joes Farm Produce Ltd Civil Appeal Number ABU 0019/2006 at pages 9 and 10 of the judgment stated the summary judgement principles as follows:-

"Here it is timely to state some of the well established principles relating to the entry of summary judgment:

(a) The purpose of 0.14 is to enable a plaintiff to obtain summary judgment without trial if he can prove his claim clearly and if the defendant is unable to set up, a bona fide defence or raise an issue against the claim which ought to be tried.

(b) The defendant may show cause against a plaintiffs claim on the merits e.g. that he has a good defence to the claim on the merits or there is a dispute as to the facts which ought to be tried or there is a difficult point of law involved.

(c) It is generally incumbent on a defendant resisting summary judgment, to file an affidavit which deals specifically with the plaintiffs claim and affidavit and states clearly and precisely what the defence is and what facts are relied on to support it.

(d) Set off, which is a monetary cross claim for a debt due from plaintiff, is a defence. A defendant is entitled to unconditional leave to defend up to the amount of the set of claimed. If there is a set off at all, each claim goes against the other and either extinguishes or reduces it Hanak v. Green (1958) 2 QB 9 at page 29 per Sellers LJ.

(e) Like wise where a defendant sets up a bona fide counterclaim arising out of the same subject matter of the action, and connect with the grounds of defence, the order should not be for judgment on the claim subject to a stay of execution pending the trial of the counter claim but should be fore unconditional leave to defend, even if the defendant admits whole or part of the claim; Morgan and Son Ltd v. S. Martin Johnson Co (1949) 1 KB 107(CA).

32. The onus is on the Plaintiff to prove each claim clearly and to satisfy the Court that the Defendant has no defence which has any realistic prospect of success.

33. Once a claim is established, at least the evidential and persuasive burden, shifts to the Defendant (see Thomas J in Hibiscus Shopping Town Pty Ltd -v- Woolworths Ltd [1993] FLR 106 at 109) who must adduce affidavit evidence dealing specifically with the plaintiffs claim and affidavit and also state clearly and precisely what the defence is and what facts he relies on to resist the entry of summary judgment; Magan Lal Brothers Ltd. –v- L. B. Masters & Company Civil Appeal No: 31/84.

34. And of course, if the Defendant has not filed an affidavit, but has filed a defence, the Court must then turn its attention on the issues raised in the defence to see whether it has merits and is not just a sham defence to delay judgment or avoid the necessity of showing cause by Affidavit (see the Fiji Court of Appeal in Magan Lal Brothers Ltd –v- L.B. Masters (supra); see also Halsbury’s Laws of England (4th Edition) volume 37 para 413 – 415, notes 4).

Discussion

35. It is not in dispute that Narayan did provide various legal services to PEU. It is clear also from Narayan’s Bills of Costs that his claim against PEU pertains to unpaid fees for various work he did for PEU from as far back as 2003. It also appears from the material before me that PEU was being billed for these for the first time in 2008.

36. Mr. Rabuku submitted that most of Narayan’s Bills were inherited by the current General Secretary upon his appointment to the position in June 2008. The relevance of that argument to his case is unclear to me.

37. Mr. Young emphasises that the late National President of PEU, Mr. Kautoga, had acknowledged the outstanding bills in his letter to Narayan dated 15th September 2008 (see AKN-2). Kautoga in the same letter had then committed PEU to a certain scheme of part-payments to Narayan. Narayan did in fact later agree to the part-payment scheme.

38. Following Mr. Kautoga’s letter of 15th September 2008, some payments were made by PEU to Narayan. There was a first payment of $10,000 made on 17th September 2008 by Kautia at Narayan’s Office in Ba. The evidence shows that Kautia then forwarded to Narayan another cheque to the sum of $10,000 a week after the first payment (though this was never cashed) and that on 17th October 2008 and 24th October 2008, Kautia arranged payments of $3,000 on these two occasions to Narayan by TMO through Post Fiji. I note though that the AKN-13 contains only one slip which records a payment of $3,000 on 17th October 2008 by one Livai Rabia.

39. Mr. Young submits that the above payments were made in compliance with the commitment by the late National President of PEU, Mr. Kautoga (see paragraphs 8, 9 and 38 above). When PEU started to default on that agreed scheme from October 2008, that then prompted S. Tagilala & Co, a firm of Business Consultants to write to Narayan on 25th February 2009 explaining PEU’s difficulties with keeping up with payments but nonetheless committing PEU to settlement of the outstanding fees and costs in due course.

40. Mr. Young urges the court to consider that, apart from having acknowledged its debt to Narayan as pleaded in the Claim, Kautia’s Affidavit does not sufficiently (if at all) condescend the particulars of a meritorious defence. All that Kautia has said consistently throughout his Affidavit is: "it was not referred to me". The onus is on PEU to show sufficient facts and particulars in its Affidavit to show it has a genuine defence (Magan Lal Brothers Ltd. –v- L. B. Narayan & Company Civil Appeal No: 31/84). But PEU has simply failed to discharge this onus. And it is no defence to say merely that PEU does not owe Narayan the amount he claims.

41. Mr. Young further submits that the late National President of PEU in his letter to Narayan dated 15th September 2008 (see AKN-2) did not in any way deny that a Bill of Costs was ever rendered by Narayan. Nor has he made any allegation whatsoever in AKN-2 that Narayan’s services were below standard. Mr. Young has drawn my attention to the fact that Kautia himself had acknowledged PEU’s commitment in AKN-2 when he (Kautia) signed the Cheques of $10,000 paid to Narayan and who had gone to Fiji Post on 17th October 2008 to make a $3,000 payment in favour of Narayan. He also highlighted that there is no denial by PEU about the interest component of the claim.

42. Mr. Rabuku refers to AKN-11. He observed that Narayan’s billings were all done on 31st of August 2008.

43. Mr. Rabuku argues that PEU used to make payments to Narayan prior to 31st August 2008 for which PEU had not been invoiced beforehand. Mr. Rabuku submitted that PEU had made payments without first scrutinising the Bills and had not received any legal advice or guidance. Mr. Rabuku also highlighted that the Bills included work from as far back as 2003 for which PEU was being billed for the first time 5 years later in 2008.

44. Mr. Rabuku also highlighted that some of the work for which Narayan had billed PEU for were still pending in the courts. He pointed these cases out in Court. He highlighted for example three specific cases for which Narayan had billed PEU but which have been listed for formal proof in Ba Magistrates Court for formal proof and other cases he highlighted where PEU would have to file setting aside applications. In all these cases, Mr. Rabuku highlighted that no defence had been filed yet PEU had been billed for them. Other cases are still on-going in Court. Mr. Rabuku argues that the claim is too excessive.

45. I do note that most of Mr. Rabuku’s submissions were on allegations of fact which were not referred to in Kautia’s Affidavit. He had in fact highlighted his predicament on this point at the outset of the hearing as he did not have any right of reply to the second Affidavit of Narayan which was in fact filed and served the day before the hearing as timetabled.

46. Mr. Young, in reply, highlights that the letter of 29th July 2008 that Mr. Rabuku had produced in Court acknowledges a $39,000 debt. He then asked for judgement on this sum, to which Mr. Rabuku consented and I accordingly entered a consent judgement on the sum.

47. Both Affidavits filed by Narayan appear to set up a watertight claim against PEU. The debt was acknowledged by the late National President of PEU. Mr. Kautoga in AKN-2 who then committed PEU to a scheme of payment. That scheme of payment appeared to have been complied with, albeit in part only, by Kautia himself and also later by a firm of Business Consultants acting on behalf of PEU on 25th February 2009 (see AKN-6).

48. On the other hand, it is hard to ignore the point raised by Mr. Rabuku (though from the bar table) that PEU had been billed substantively for some cases for which a default judgement has been entered against PEU as no defence was ever filed. I accept that these allegations are not in the Affidavit of Kautia.

49. But it appeared that Rabuku was only alerted to this when he was served Narayan’s Affidavit in Answer the day before the hearing of this application. That Affidavit then attached invoices for all outstanding payments that were allegedly supplied to PEU as at 31st August 2008 which of course Mr. Rabuku could not have addressed appropriately because it was only timetabled to be filed and served on the day before the hearing and also as Mr. Rabuku was not given any right of reply.

50. I do bear in mind that the invoices included work done in 2003 and for which PEU appeared to have been billed for the first time in 2008. I also note that Mr. Rabuku had more or less conceded that Narayan was entitled to some payment, but whether that $39,000 was all that Narayan was entitled to, or whether he was entitled to more, and if so how much is disputed.

Conclusion

51. To reiterate, Narayan has mounted what I would assess at this preliminary stage as a watertight case against PEU. PEU had acknowledged the debt and the amount claimed through its former National President, Mr. Kautoga. PEU also appeared to have then made payments in acknowledgement of the commitments made by Mr. Kautoga.

52. But Mr. Rabuku has raised some issues questioning some of the Bills. He also highlights that the Bills pertain to work carried out as far back as 2003 and were not properly scrutinised. Why the delay in billing in some of these matters? Admittedly, Mr. Rabuku has not addressed the points raised in Narayan’s second affidavit in any great detail. At this stage however, I am prepared to accept that the reason for that is because he did not have a right of reply to that affidavit. Perhaps if the invoices were attached to Narayan’s first Affidavit, Rabuku might have dealt with them in his Affidavit in Reply.

53. But, be that as it may, it is hard to ignore the issues raised by Mr. Rabuku which in my view, deserve a proper trial hearing. In adopting that view, I have taken into account the following: -

(a) the Bills of Costs rendered on 31st August 2008 included work from 2003

(b) there are matters still pending in Court for which default judgements were entered against PEU – but for which PEU has been billed by Narayan (I caution myself that I am not now accepting this as fact, but am merely giving PEU the benefit at this stage to highlight this in a defence and whatever impact it will have on the claim if at all)

(c) the fact that the Bills of Cost were only attached to Narayan’s second affidavit (rather than the first Affidavit) which procedurally, hindered PEU from addressing it in detail.

(d) that PEU will have to go through its records from 2003 in order to deal with the issue

54. Even in the possibility that this case may unfurl to an issue of quantum only, I am of the view that the interest of justice dictates that PEU should have their day in Court on the issues raised by Mr. Rabuku.

ORDERS

(i) 21 days to PEU to file defence

(ii) 14 days thereafter for any reply by Narayan

(iii) In the way proceedings have unfolded, I award costs in the sum of $250-00 to be paid to the Plaintiff within 21 days.

Case adjourned to 22nd January 2010 for mention.

Tuilevuka
Master

25th November, 2009.