Hawker Pacific Pty Ltd v Air Fiji Ltd [2009] FJHC 99; HBC576.2007 (3 April 2009)

IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION

CIVIL ACTION NO: HBC 576 OF 2007

IN THE MATTER of the Foreign Judgments (Reciprocal Enforcement) Act, Cap 40, Law of Fiji

AND:

IN THE MATTER of a Judgment of the Supreme Court of New South Wales, Sydney Registry, Equity Division, Australia
obtained in Case No. 4462 of 2007 by
HAWKER PACIFIC PTY LIMITED as Plaintiff against
AIR FIJI LIMITED as Defendant entered on 29 October 2007.

Mr. P. Sharma for Defendant
Mr. T. Tuitoga for Plaintiff

Date of Hearing: 1st April 2009
Date of Ruling: 3rd April 2009

RULING

(On the Defendant’s application for Stay and Leave to Appeal)

A. BACKGROUND

[1]. On 29 October 2007, Hawker Pacific Pty Limited ("Hawker Pacific") (Plaintiff), a company duly incorporated in Australia having its registered office in New South Wales, obtained a default judgment against Air Fiji Limited ("Air Fiji") (Defendant), a company duly incorporated under the laws of Fiji having its registered office at Nausori, in the sum of "AUD766,020.70 inclusive of interest and costs" in the Supreme Court of New South Wales, Sydney Registry, Australia (the "NSW Judgment").

[2]. That judgment was registered in Fiji as an Order of the High Court of Fiji pursuant to the provisions of the Foreign Judgments (Reciprocal Enforcement) Act, Cap 40 on 21 December 2007.

[3]. Air Fiji applied by Motion filed in the High Court at Suva on 22 January 2008 for the following orders:

"(a) That the registration of the judgment obtained by Hawker Pacific Pty Limited be set aside; and

(b) That all execution of the said judgment be stayed forthwith pending final determination of this application by Air Fiji Limited..."

[4]. The Air Fiji application was heard on 17 and 18 December 2008 and Mr Justice Singh delivered the Court’s Judgment on 29 January 2009 (the "Fiji Judgment").

[5]. The Fiji Judgment affirmed the validity of the registration of the NSW Judgment in Fiji but stayed "enforcement of the judgment for a temporary period in which time Air Fiji can make an application to set aside the NSW judgment in the New South Wales Court."

[6]. Air Fiji now applies for an extension of that stay and leave to appeal against the affirmation of registration of the NSW Judgment and abridgement of time to appeal if so required.

[7]. I thought it more expedient that I hear the application for the Stay first before the Leave application so I heard Counsel on 1 April 2009.

B. APPLICATION FOR EXTENSION OF STAY OF ENFORCEMENT

[8]. The Air Fiji application came by way of Notice of Motion filed on 18 February 2009.

[9]. The motion was supported by two affidavits by SADA SIWAN GOUNDER, Air Fiji’s Human Resources Manager, the first filed on 18 February 2009 and the second filed on 31 March 2009.

[10]. The Respondent/Plaintiff, Hawker Pacific, did not file any affidavits in reply.

[11]. Both Counsels filed written submissions, for which I am grateful for their effort and assistance, in addition to making oral submissions on the hearing of this application.

AIR FIJI’S CASE

[12]. Counsel for Air Fiji referred me to paragraph [38] of the Fiji Judgment which states:

"Accordingly, I do not set aside registration but stay the enforcement until 15th March 2009 thereby giving an opportunity to Air Fiji to make the necessary application to set aside default judgment in NSW Court. Once that application is made, Air Fiji is at liberty to apply for extension of stay in the event the application is not determined by 15th March 2009 by the New South Wales Court."

[13]. He submitted that Air Fiji having filed the "necessary application" by its NSW solicitors in terms of paragraph 38 of the Fiji Judgment on 11 March 2009 (see paragraph 5 of the Second Affidavit of SIDA SIWAN GOUNDER) before the deadline of 15 March 2009, and that application having not been determined by the deadline, Air Fiji is at liberty to apply for an extension of the stay initially granted by Mr Justice Singh. This was the main thrust of Air Fiji’s application.

[14]. Counsel further submitted that the Judgment debt is disputed. He says that where invoices, issued out of the same transaction, had not been disputed, Air Fiji had paid on demand. He referred to a payment of $200,000 already made. However, where invoices are disputed, payments were not made, such as the alleged debt on which the Fiji Judgment is based.

HAWKER PACIFIC’S CASE

[15]. Counsel for Hawker Pacific argued that this is not one of those exceptional cases which would displace the normal rule that the judgment creditor is entitled to enjoy the fruits of its judgment immediately. I am grateful for counsel’s reference in his submissions to the case authorities and his analysis of the application of the law to the facts of this case.

THE LAW

[10]. As Counsel for Hawker Pacific submitted, the leading case on stay in Fiji is the Court of Appeal decision in: Natural Waters of Viti Ltd v Crystal Clear Mineral Water (Fiji) Ltd [2005] FJCA 13; ABU0011.2004S (18 March 2005). At paragraph [7] the Court sets out the principles on stay applications:

"Principles on a stay application

[7] The principles to be applied on an application for stay pending appeal are conveniently summarised in the New Zealand text, McGechan on Procedure (2005):

"On a stay application the Court’s task is "carefully to weigh all of the factors in the balance between the right of a successful litigant to have the fruits of a judgment and the need to preserve the position in case the appeal is successful": Duncan v Osborne Building Ltd (1992) 6 PRNZ 85 (CA), at p 87.

The following non-comprehensive list of factors conventionally taken into account by a Court in considering a stay emerge from Dymocks Franchise Systems (NSW) Pty Ltd v Bilgola Enterprises Ltd (1999) 13 PRNZ 48, at p 50 and Area One Consortium Ltd v Treaty of Waitangi Fisheries Commission (1993) 7 PRNZ 200:

(a) Whether, if no stay is granted, the applicant’s right of appeal will be rendered nugatory (this is not determinative). See Philip Morris (NZ) Ltd v Liggett & Myers Tobacco Co (NZ) Ltd [1977] 2 NZLR 41 (CA).

(b) Whether the successful party will be injuriously affected by the stay.

(c) The bona fides of the applicants as to the prosecution of the appeal.

(d) The effect on third parties.

(e) The novelty and importance of questions involved.

(f) The public interest in the proceeding.

(g) The overall balance of convenience and the status quo."

See also Lal & Ors v Kumar & Ors: Civil Action 213 of 1994.

[16]. I will now consider each of these factors as are relevant to this application.

APPLICATION OF LAW AND REASONS

APPEAL RENDERED NUGATORY IF NO STAY?

[17]. Counsel for Air Fiji submitted that if no stay is granted, Air Fiji "will" be wound up because of the large sum that is involved here, AUD$766,020.70, which is close to a million Fiji dollars at the current exchange rate. Although this is not deposed to in the affidavit material, I believe I can take judicial notice of the fact that this is a very large sum of money for this country even for an airline such as Air Fiji. Counsel argued that if Air Fiji is made to pay this amount either to the Plaintiff or into court, (as counsel for Hawker Pacific suggested as an alternative order), there maybe no point in proceeding with the appeal.

[18]. I accept Air Fiji’s submission that if there is no stay, its appeal may be rendered nugatory. I also agree that a conditional stay, i.e. a stay on the condition that the money is paid into court, would have the same effect.

SUCCESSFUL PARTY INJURIOUSLY AFFECTED BY THE STAY?

[19]. A factor which I am very mindful of is that referred to by Mr Justice Singh at paragraph [36] of his Judgment:

"One factor stands out in these proceedings and that is the parties had chosen New South Wales laws as the applicable law and submitted to its jurisdiction..."

[20]. And at paragraph [37] His Lordship said this:

"It would be unwise of this court to impose Fiji’s jurisdiction, a different jurisdiction, onto the parties in trying to determine substantive issues. In none of the cases I referred to earlier in my judgment had the parties agreed in writing to a particular jurisdiction. Those cases therefore can be distinguished in that respect. The ends of justice can best be served if I stay enforcement of the judgment for a temporary period in which time Air Fiji can make an application to set aside the NSW judgment in the New South Wales Court".

[21]. I agree with and share His Lordship’s concerns. For me to refuse to extend the stay would in effect circumvent Air Fiji’s application in NSW to set aside the default judgment which underpins the Fiji Judgment. It would, as Mr Justice Singh says, "be unwise of this court to impose Fiji’s jurisdiction, a different jurisdiction, onto the parties in trying to determine substantive issues."

[22]. Further, it would be equally unwise if I were to lift the stay allowing Hawker Pacific to enforce its judgment debt in Fiji where the NSW Court may well set aside the underpinning default judgment and allow the parties to litigate the substantive issues in the dispute in NSW.

[23]. Counsel for Hawker Pacific vigorously argued that not only is Air Fiji’s appeal destined to fail but also its application in NSW to set aside the default judgment. Obviously, I am not in a position, nor is it necessary, in my view, for me to decide such prospects of success.

[24]. The bottom line is that the parties must be allowed to litigate the substantive issues in NSW. This is implicit in the reasoning of Mr Justice Singh and the orders that His Lordship made in the Fiji Judgment. I agree with His Lordship.

[25]. It is my view that Air Fiji will suffer more hardship and prejudice than Hawker Pacific if the stay is not extended pending the Fiji appeal or the outcome of the NSW application. Hawker Pacific will not, in my view, be injuriously affected by the stay remaining for this interim period.

[26]. These are exceptional circumstances, in my opinion, to displace the normal rule.

ORDERS

[27]. I therefore make the following orders:

• (a) Enforcement of the Judgment of Mr Justice Singh dated 29 January 2009 is stayed pending the outcome of the appeal.
  
• (b) The parties are at liberty to apply if Air Fiji’s proposed appeal in the Fiji Court of Appeal or its application in the NSW Court to set aside the default judgment do not proceed.
  

C. APPLICATION FOR LEAVE TO APPEAL:

[28]. I note that both Counsels have made written submissions on the application for leave to appeal. I indicated to them that I would hear argument on the leave application after I deliver my Ruling on the Stay application. However, I note and commend Counsel for their comprehensive written submissions on the leave application so I will deal with that application now to avoid further delay.

INTERLOCUTORY OR FINAL ORDER?

[29]. The first issue to decide is whether the Fiji Judgment is a final or interlocutory judgment.

THE LAW

[30]. The leading case is: Goundar v Minister for Health [2008] FJCA 40; ABU0075.2006S (9 July 2008), a decision of the Fiji Court of Appeal (Byrne, Powell and Khan JJA) which clarified the law as follows (at paragraphs 37 and 38 of the judgment):

"37. This is the position. Where proceedings are commenced in the High Court in the Court’s original jurisdiction and the matter proceeds to hearing and judgment and the judge proceeds to make final orders or declarations, the judgment and orders are not interlocutory.

38. Every other application to the High Court should be considered interlocutory and a litigant dissatisfied with the ruling or order or declaration of the Court needs leave to appeal to that ruling order or declaration. The following are examples of interlocutory applications:

1. an application to stay proceedings;

2. an application to strike out a pleading;

3. an application for an extension of time in which to commence proceedings;

4. an application for leave to appeal;

5. the refusal of an application to set aside a default judgment;

6. an application for leave to apply for judicial review."

(emphasis added)

THE FACTS

[31]. The NSW Judgment in favour of Hawker Pacific was registered in the High Court of Fiji by Order made on 21 December 2007. The Order was served on Air Fiji on 7 January 2008. Air Fiji applied by Motion filed in the High Court at Suva on 22 January 2008 for the following orders:

"(a) That the registration of the judgment obtained by Hawker Pacific Pty Limited be set aside; and

(b) That all execution of the said judgment be stayed forthwith pending final determination of this application by Air Fiji Limited..."

[32]. The Air Fiji application was heard on 17 and 18 December 2008 after full and comprehensive written submissions supplemented by oral submissions by Counsel, and the Court delivered a 13 page (39 paragraph) fully reasoned judgment on 29 January 2009 (the Fiji Judgment).

APPLICATION OF LAW & REASONS

[33]. It is my opinion that the Fiji Judgment fell within the category of final judgments in accordance with the decision in Goundar (supra) i.e. the matter had proceeded to hearing and judgment and the judge had made final orders.

[34]. The substance of the Fiji Judgment is in respect of the registration of the NSW Judgment as an order of the High Court of Fiji and the Stay of enforcement is only ancillary, in my view. Similarly, the making of ‘no order as to costs’ is ancillary too. To hold that because some ancillary part of the judgment is interlocutory therefore the whole of the judgment is interlocutory even though the substantive part is final would in my view create more uncertainty and put the law back in the position that existed before Goundar (supra).

[35]. I am therefore of the opinion that the Fiji Judgment is a final judgment and no leave to appeal is required.

[36]. The time limited for filing and serving of the notice of appeal is therefore 6 weeks calculated from the date on which the judgment or order of the Court below was signed, entered or otherwise perfected: (Rule 16(b) of the Court of Appeal Rules).

[37]. The Fiji Judgment was dated 29 January 2009 and the Order setting out the terms of the judgment was filed on 30 January 2009 but sealed on 2 February 2009. I take 2 February 2009 as the date from which the time limited to appeal ran from. The six weeks then expired on 16 March 2009.

[38]. Air Fiji filed its Motion for leave to appeal on 18 February 2009, thinking that leave was required. The motion was not heard until 1 April 2009 because of the transfer of Mr Justice Singh to Lautoka, who would, normally, have heard the leave and stay applications, and the lack of other civil judges in Suva. It is through no fault of Air Fiji that the Leave application was not heard in sufficient time to allow it to file its Notice of Appeal. I would therefore allow more time for Air Fiji to file its Notice of Appeal and order that it do so within 28 days.

ORDERS

[39]. I therefore make the following orders in respect of both applications for Stay and Leave to appeal:

• (a) Enforcement of the Judgment of Mr Justice Singh dated 29 January 2009 is stayed pending the outcome of the appeal.
  
• (b) The parties are at liberty to apply if Air Fiji’s proposed appeal in the Fiji Court of Appeal or its application in the NSW Supreme Court to set aside the default judgment do not proceed.
  
• (c) Air Fiji is given leave to file and serve its Notice of Appeal and other Appeal documents within 28 days from the date hereof.
  

[40]. I will now hear Counsel as to the costs of the substantive motion and this motion for Stay and Leave to appeal.

[Sosefo Inoke]
JUDGE

At Suva
3rd April 2009