Sharma v Morris Hedstrom Ltd [2009] FJHC 263; HBC116.2009L (26 November 2009)

IN THE HIGH COURT OF FIJI
AT LAUTOKA
CIVIL JURISDICTION

Civil Action No. HBC 116 of 2009L

BETWEEN:

RANJANI DEVI SHARMA
(f/n Shantanu Prasad) of Kulukulu, Sigatoka, Domestic Duties
Plaintiff

AND:

MORRIS HEDSTROM LIMITED
a limited liability company having its registered office at Suva and carrying on business around Fiji
1st Defendant

AND:

KRISHNEEL RAVINESH REDDY
(f/n not known to the Plaintiff) of Olosara, Sigatoka, Acting Manager
2nd Defendant

INTERLOCUTORY JUDGMENT

Of: Inoke J.

Counsel Appearing: No Appearance for the Plaintiff
Ms Prakash for the Defendants

Solicitors: Samusamuvodre Sharma Law for the Plaintiff
Legal Department, Carpenters Fiji Limited for the Defendants

Date of Hearing: 13 October 2009
Date of Judgment: 26 November 2009

INTRODUCTION

[1] This is an application under Order 18 rule 18(1)(a) of the High Court Rules 1988 for orders that the Defendants cease to be a party in this action. Despite the orders being framed in the way that I have just stated, the application proceeded as a striking out application so I will treat it as such.

THE STRIKING OUT APPLICATION

[2] The application was brought by the in-house solicitors for Carpenters Fiji Limited ("Carpenters") which is the correct legal entity under which the Morris Hedstrom group of stores operate in Fiji. The grounds of the application are that the First Defendant does not exist and is not a legal entity and, secondly, that the Writ is defective in that the proper forum is the Employment Relations Court.

[3] As the application is made under Or 18 r 18(1)(a), no evidence is allowed so no affidavits were filed by the Defendants.

[4] The Summons to strike out was filed on 2 September 2009, returnable on 18 September 2009. When the matter was called on 18 September 2009 both Counsels agreed to file written submissions within 21 days and the application heard on 13 October 2009.

THE APPLICATION TO SUBSTITUTE A PARTY

[5] On 6 October 2009, the Plaintiff, obviously being alerted to her mistake by the Carpenters application, filed an application to substitute "Carpenters Fiji Limited" for "Morris Hedstrom Limited" as First Defendant. The application was supported by an affidavit by a law clerk employed by the Plaintiff’s solicitors deposing that after carrying out a company search, he found out that the proper name of the First Defendant was "Carpenters Fiji Limited."

[6] The Summons states that the application is made pursuant to the inherent jurisdiction of the Court.

HEARING OF THE APPLICATIONS

[7] When both applications were called for hearing on 13 October 2009, Counsel for the Plaintiff did not appear. Ms Prakash, Counsel for the Defendants, urged me to hear her application as she had travelled all the way from Suva that morning to attend to this hearing.

[8] I acceded to her request and heard her application. She handed up written submissions for which I am grateful. No submissions were filed for the Plaintiff.

THE CLAIM

[9] The Plaintiff pleaded in her Statement of Claim that she was employed as a variety supervisor at Morris Hedstrom Limited. For the purposes of reciting the facts I will refer to the First Defendant, as currently named in the Writ, as "MHs". The Second Defendant was the acting manager of MHs at Sigatoka. On 9 May 2009, the Second Defendant issued a letter terminating the Plaintiff’s employment, accusing her of being dishonest, unreliable and unfaithful. The Plaintiff says that the allegations were false and that her reputation has been tarnished. She is now living in shame and cannot find suitable employment. She claims loss of salary, damages for unlawful dismissal and damages for defamation.

[10] The Defence is yet to be filed.

CONSIDERATION OF THE APPLICATION TO STRIKE OUT

[11] The law on striking out is well settled. Only in exceptional cases should an action be struck out: Kumar v Kumar [2003] FJHC 247; HBC0033d.2003S (14 August 2003). In National MBF Finance (Fiji) Ltd v Buli [2000] FJCA 28; ABU0057U.98S (6 July 2000), the Court of Appeal[1] 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 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. It follows that an application of this kind must be determined on the pleadings as they appear before the court. In this case the Judge’s task was made more difficult because a considerable amount of factual material was placed before him. We wish to point out that this is inappropriate and undesirable.

[12] Putting aside for the moment, the Plaintiff’s application for substitution, Counsel for the Defendants submits that the Employment Relations Promulgation 2007 requires this action to be brought in the Employment Relations Court.

[13] It is clear that if this case only dealt with the Plaintiff’s employment, then the Promulgation applies. However, the claim here includes a claim for damages for defamation which, in my view, is not "founded on" the Plaintiff’s employment contract. I use this phrase because it used in s 220(1)(h) of the Promulgation in relation to the jurisdiction of the Employment Relations Court. The defamation claim is founded on the alleged defamatory statement that the Plaintiff was "dishonest, unreliable and unfaithful" rather than on her contract of employment. Such a claim on its own would not be subject to the provisions of the Promulgation so the question arises as to whether the inclusion of such a claim with a claim under the Promulgation would take the whole matter out of the Employment Relations Court.

[14] I am unable to find any provision in the Promulgation which expressly reserves to the exclusive jurisdiction of the Employment Relations Court and Tribunal all claims relating to employees and employers. Section 3, which provides that "this Promulgation applies to all employers and workers in workplaces in Fiji", with certain exceptions which do not apply here, seems to suggest that the Tribunal and Employment Relations Court have exclusive jurisdiction. There can be no doubt that where the claim is wholly "founded on" the employment relation between the party, the Employment Relations Court and Tribunal have exclusive jurisdiction. But the position, in my view, is not clear where the claims are mixed, as is the case here.

[15] I think it would be unwise to separate the claims into their employment based and non-employment based components to be adjudicated in two separate tribunals. Both tribunals could come to different and contradictory conclusions of fact. Cases on unfair dismissal have been decided in this Court over many years now and the provisions of the Promulgation do not affect the substantive law in that area. It seems to me therefore, that the High Court in its civil jurisdiction is the proper forum in this case.

[16] I am therefore of the view that this Court has jurisdiction to hear this case where the claim includes a claim founded on the employment relationship between the parties and a claim not founded on such a relationship.

[17] In these circumstances, I do not think that this is one of those exceptional cases in which the action should be struck out.

CONSIDERATION OF THE APPLICATION TO SUBSTITUTE

[18] There remains the Plaintiff’s application to substitute "Carpenters Fiji Limited" as the First Defendant. It is also the second ground on which the Defendants say the action should be struck out because they say the First Defendant as named is not a legal entity.

[19] Ms Prakash, Counsel for the Defendants, did not deal with this issue separately but dealt with it as part of her submissions on the striking out application. She made very helpful submissions on the Court’s inherent jurisdiction but I think the matter should be decided under the specific provisions of the High Court Rules, namely, O 15 r 6(1) – (3) which provides:

6(1) No cause or matter shall be defeated by reason of the misjoinder or nonjoinder of any party; and the Court may determine the issue or questions in dispute so far as they affect the rights and interests of the persons who are parties to the cause or matter.

6(2) Subject to the provisions of this rule, at any stage of the proceedings in any cause or matter the Court may on such terms as it thinks just and either of its own motion or on application –

(a) Order any person who has been improperly or unnecessarily made a party or who has for any reason ceased to be a proper or necessary party, to cease to be a party;

(b) Order any of the following persons to be added as a party, namely

(i) Any person who ought to have been joined as a party or whose presence before the Court is necessary to ensure that all matters in dispute in the cause or matter may be effectually and completely determined and adjudicated upon, or

(ii) Any person between whom and any party to the cause or matter there may exist a question or issue arising out of or relating to or connected with any relief or remedy which in the opinion of the Court it would be just and convenient to determine as between him and that party as well as between the parties to the cause or matter.

6(3) An application by any person for an order under paragraph (2) adding him as a party must, except with the leave of the Court, be supported by an affidavit showing his interest in the matters in dispute or, as the case may be, the question or issue to be determined as between him and any party to the cause or matter.

[20] It seems to me that the proposed substitution falls clearly within these provisions and should be allowed.

[21] Even approaching this issue as a question of amendment, because it could be argued that an entity that does not exist in law is not a "party" as such, I think the amendment should be allowed.

[22] The law on amendment of pleadings has been conveniently summarised by Phillips J in Perry v Gregory [2006] FJHC 83; HBC0064.2003L (29 November 2006):

"It is a guiding principle of cardinal importance on the question of amendment that, generally speaking, all such amendments ought to be made for the purpose of determining the real question in controversy between the parties to any proceeding or of correcting any defect or error in any proceedings" (per Jenkins L. J in G. L. Baker Ltd –v- Medway Building & Supplies Ltd [1958] 1 W.L.R 1216 P. 1231 cited in The Supreme Court Practice 1995 Notes at 20/5-8/6).

Other principles which I am obliged to consider are:

(i) the object of the Court is to decide the rights of the parties and not to punish them for mistakes they make in the conduct of their cases by deciding otherwise than in accordance with their rights.

(ii) mistakes should be corrected by amendment if it can be done without injustice to the other party.

(iii) as soon as it appears that the way in which a party has framed his case will not lead to a decision of the real matter in controversy it is as much a matter of right on his part to have it corrected if it can be done without injustice, as anything else in the case is a matter of right. (The Supreme Court Practice 1995 Notes at 20/5 – 8/6).

[23] This is one of those cases where an amendment should be allowed so that the real controversy between the parties can be determined. The proceedings have just begun, no defence has been filed and prejudice to the First Defendant is minimal. In any event, any prejudice can be adequately compensated in costs.

[24] For the above reasons therefore the Defendants’ application to strike out the Plaintiff’s claim fails and the Plaintiff’s application for substitution or to otherwise amend her Writ and Statement of Claim succeeds. The Plaintiff is given leave to amend her Writ and Statement of Claim by changing the name of the First Defendant to "Carpenters Fiji Limited".

COSTS

[25] These applications have been necessitated by the Plaintiff’s carelessness. She should pay the Defendants’ costs which I fix at $500 to be paid within 21 days.

ORDERS

[26] The Orders are therefore as follows:

• (i) The Plaintiff is granted leave to amend her Writ and Statement of Claim by changing the First Defendant’s name to "Carpenters Fiji Limited".
  
• (ii) The Plaintiff shall file and serve the Amended Writ and Statement of Claim within 21 days.
  
• (iii) The action shall thereafter take its normal course.
  
• (iv) The Plaintiff shall pay the Defendants’ costs of $500 within 21 days.
  

Sosefo Inoke
Judge

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^[1] Sir Thomas Eichelbaum, Sir David Tompkins and Sir Rodney Gallen JJA