Atkinson v Namale West Inc [2012] FJHC 1363; HBC166.2008 (9 October 2012)

IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION

Civil Action No. HBC 166 of 2008

BETWEEN:

BARRY ATKINSON of Nadi, Fiji Islands.
PLAINTIFF

AND:

NAMALE WEST, INC,
a foreign company incorporated in California in the United States of America and registered as a foreign corporation in the Republic of the Fiji Islands and situated at the offices of Munro Leys & Co., Barristers & Solicitors in Suva.
DEFENDANT

BEFORE : Master Deepthi Amaratunga
COUNSELS : Mr. Vakacakau N. & Ms. Vanua M. B. for the Plaintiff
Mr. Prasad N. for the Defendant

Date of Hearing : 20th September, 2012
Date of Decision : 9th October, 2012

DECISION

1. INTRODUCTION
   

1. The Plaintiff filed this action seeking damages for alleged wrongful termination of his employment contract by the Defendant. The alleged termination happened on 14th March 2008. The action was filed on 4th September, 2008. The limitation period for wrongful termination of a contract is six years. So, the Plaintiff's action is not barred under the Limitation Act bringing an action even now. The Plaintiff did not take a step for more than 6 months and the Defendant filed the summons to strike out the action for want of prosecution. The Defendant has alleged prejudice to them due to delay as a principle witness has left the company. Since the Plaintiff could bring an action for breach of a contract within 6 years from the alleged breach, the alleged prejudice cannot be considered as prejudice due to delay as the Plaintiff could have waited six years till 2014 to institute this action and any movement of witnesses during that time cannot be considered as prejudice. If the action is struck off the Plaintiff could bring another action since he is still within the limitation period, which would cause further delay to the Defendant who is already alleging prejudice due to the movement of witnesses. The ratio of Birkett v James [1978] A.C is applicable and the summons to strike out should be dismissed. Neither party addressed this pertinent issue at the hearing, though both parties relied on the said judgment.
   

2. ANALYSIS
   

2. The Plaintiff was directed to deposit a security for cost on 9th September, 2011 and no security for cost was deposited within the stipulated time in the said ruling. After 9 months the Defendant filed this summons to strike out on 15th June, 2012.
   
3. The Plaintiff on 25th July, 2012 filed a motion seeking extension of the time to deposit the security for cost. The said motion seeks 14 days to deposit the security for cost.
   
4. The affidavit of the Plaintiff filed on 26th July, 2012 states as follows
   

'5. I was making the installments into my solicitors' office account and not their trust account as they had instructed me. Annexed hereto and marked BJ 01 a copy of Viet Com Bank telegraphic transfer receipt dated 13 September 2011, 7 October, 2011 and 2 December, 2011.

6. The payments into my solicitors' bank account also included my payments for legal fees.'
   
5. So, the Plaintiff has by 2nd December, 2011 paid the entire security for cost and this is evidenced from the amounts that were transferred to the solicitors' office account. I do not wish to say anything about the legality of the said remittance. The client's security for cost being remitted to solicitors' office account on the instructions of the solicitors and this has not been deposited timely. This is a matter for Chief Registrar and relevant authorities. The solicitors did not deposit the security for cost or sought extension of time to deposit what they received till this summons for strike out for want of prosecution, was served on to them.
   
6. The affidavit of Mereseni Belinda Vanua, filed on 26th July, 2012 confirmed the receipt of the security for cost, and at paragraph 8 states as follows
   

'8. The Plaintiff was making payment of both the Security and our legal fees into the Lowing and Associates office account.'

9. Our office had informed the plaintiff on numerous occasions to deposit the security monies into the Lowing Nandan and Associates Trust account, but the installments continued to be made into the Lowing & Associates office accounts, as such, our accounts clerk accepted the deposits as payment for our legal fees.'

7. The above averments are clearly contradictory to the averment of the Plaintiff who had stated that he was instructed to remit the funds to the office account as opposed to the trust account. If the client continued to remit such funds it would have been deposited timely and would have deposited security for cost in High Court Registry at least by 2nd December, 2011, after seeking an extension of time. So, the reason for the inordinate delay is clearly attributable to the solicitors and not to the Plaintiff.
   
8. Birkett v James [1978] A.C. 297 at page 319-320 Lord Diplock stated as follows
   

'(1) Non –expiry of limitation period

Under this head your Lordships are not concerned with cases where the purpose of dismissing the action is not be because there would be risk of injustice in allowing it to be brought to trial but is to punish the dilatory plaintiff by mulcting him in costs before allowing him to proceed further with his claim. There are other ways of doing that, short of dismissing the action, in those cases where legal aid does not render the plaintiff immune to any sanctions of this kind.

Crucial to the question whether an action ought to be dismissed for want of prosecution before the expiry of the limitation period is the answer to a question that lies beyond it, viz., whether a plaintiff whose action has been so dismissed may issue a fresh writ for the same cause of action. If he does so within the limitation period, the effect of dismissing the previous action can only be to prolong the time which must elapse before the trial can take place beyond the date when it could have been held if the previous action had remained on foot. Upon issuing his new writ the plaintiff would have the benefit of additional time for repeating such procedural steps as he had already completed before the action was dismissed. This can only aggravate; it can never mitigate the prejudice to the defendant from delay.

9. In the circumstances I need not go further than this to dismiss this application for strike out since the alleged breach of contract happened on 14th March, 2008 and the limitation for a breach of written contract is six years in terms of Section 4 of Limitation Act.
   
10. Birkett v James [1978] A.C. 297 at page 319-320 Lord Diplock further elaborated his reasoning for disallowing an application for strike out when the time period for limitation is yet to be expired and stated as follows. I cannot do better than quoting it.
    

P 320 para c-

'It is an attractive argument that if a court has power to dismiss an action already started because it considers that the time which the plaintiff has allowed to elapse since his cause of action first accrued has resulted in a substantial risk that justice may not be done to the defendant at the trial, the court by parity of reasoning should also have power to prevent a fresh action being started. But this begs the very question that your Lordships must decide. It assumes that the court has power to treat as amounting to inordinate and inexcusable delay in proceeding with an action a period shorter than that within which Parliament by a Limitation Act has manifested its intention that a plaintiff should have a legal right to commence proceeding with his action. No one has been bold enough to argue that if the plaintiff has not issued a pervious writ he could be deprived of that right at the discretion of a judge because the judge thought that in the circumstances of the particular case the statutory limitation period was too long. So, in such a case, at any rate, time elapsed before issue of the writ which does not extend beyond the limitation period cannot be treated as inordinate delay; the statue itself permits it.

Can that same period of time elapsed become inordinate delay so as to entitle the court to prevent the plaintiff from issuing his writ within the limitation period by reason of the fact that he had started previous proceedings for the same cause of action which have become abortive? In the ordinary way the prejudice caused to the defendant by lapse of time is likely to be greater where no previous proceedings had been brought to have given him more notice of what is intended to be alleged against him than if they had not been brought at all. So, there is nothing here to transform into inordinate delay time that has elapsed before the expiry of the limitation period.

There may be exceptional cases, of which Spring Grove Services Ltd v Deane (1972) 116 S.J. 844 (to which I shall be referring later) may be an example, where the plaintiff's conduct in the previous proceedings has induced the defendant to do something which will create more difficulties for him in presenting his case at the trial than he would have had if the previous proceedings had never been started. In such a case it may well be that the court, in the exercise of its inherent jurisdiction, should stay the second proceedings on the ground that, taken as a whole, the plaintiff's conduct amounts to an abuse of the process of the court. But, such exceptional cases apart, where all that the plaintiff has done has been to let the previous action go to sleep, the court in my opinion would have no power to prevent him starting a fresh action within the limitation period and proceeding with it with all proper diligence notwithstanding that his previous action had been dismissed for want of prosecution.

If this be so, it follows that to dismiss an action for want of prosecution before the limitation period has expired does not, save in the exceptional kind of case to which I have referred, benefit the defendant or improve his chances of obtaining a fair trial; it has the opposite tendency.

The court may and ought to exercise such powers as it possesses under the rules to make the plaintiff pursue his action with all proper diligence, particularly where at the trial the case will turn upon the recollection of witness to past events. For this purpose the court may make peremptory orders providing for the dismissal of the action for non-compliance with its order as to the time by which a particular step in the proceedings is to be taken. Disobedience to such an order would qualify as "intentional and contumelious" within the meaning of the first principle laid down in Allen v Mc Alpine. But where no question of non-compliance with a peremptory order is involved the court is not in my view entitled to treat as "inordinate delay" justifying dismissal of the action in accordance with the second principle in Allen v Mc Alpine a total elapsed since the accrual of the cause of action which is no greater than the limitation period within which the statue allows plaintiffs to start that action. To dismiss the action in such circumstances would, in my view, involve an error in principle in the exercise of judicial "discretion" which it is the function of the appellate court to correct. (emphasis is mine)

.............

P 322 para D

'For my part, for reasons that I have already stated, I am of opinion that the fact that the limitation period has not yet expired must always be a matter of great weight in determining whether to exercise the discretion to dismiss an action for want of prosecution where no question of contumelious default on the part of the plaintiff is involved; and in cases where it is likely that if the action were dismissed the plaintiff would avail himself of his legal right to issue a fresh writ the non-expiry of the limitation period is generally a conclusive reason for not dismissing the action that is already pending. (emphasis is mine)

11. I fully endorse the sound reasoning of the said decision and wish to add only that a person who comes to court quickly without waiting to the end of limitation period is at an advantages position as against a person who delayed and waited till the near end of such limitation period to institute the action when there is a delay subsequently. Though both would initially be successful in instituting the action, if there is a delay later in the action for more than the time stipulated in Order 25 the action for the person who's limitation period has not expired will not be struck off for want of prosecution. There is a logic behind the rationale as no party can abandon an action beyond the limitation period for the alleged cause of action.
    
12. In Allen v Sir Alfred Mc Alpine & Sons Ltd et al [1968] 2 Q.B 229 more extensively discussed the principles in striking out and though it was held nearly decade earlier and much water has gone under the bridge on this issue of striking out for want of prosecution, this decision was affirmed by Lord Diplock in Birkett v James [1978] A.C. 297 at page 318-319 held as
    

'My noble and learned friend Lord Salmon and I myself were parties to the decision in Allen v Mc Alpine. My noble and learned friends Lord Edmund-Davies and Lord Russell of Killowen have been parties to subsequent decisions of the Court of Appeal in which those principles have been applied. In the instant appeal no one has sought to question them. For may part I think they are correct and should receive the approval of this House, though possibly with some reservations as to the general application of what my noble and learned friend Lord Salmon and I said in Allen v Mc Alpine about the relevance of the absence of an effective remedy for the plaintiff against his own solicitor.'

13. For brevity Lord Diplock referred to the earlier decision Allen v Sir Alfred Mc Alpine & Sons Ltd as Allen v Mc Alpine in the subsequent decision. So, the decision in Allen v Sir Alfred Mc Alpine & Sons Ltd et al [1968] 2 Q.B 229 is good law except to the minor change that dealt regarding the issue of availability of effective remedy against the solicitor, which I am not going to discuss in this decision. Save that, the decision pronounced ten years ago was held a sound law on the issue of striking out. In Allen v Sir Alfred Mc Alpine & Sons Ltd (supra) LORD DENNING M.R. stated as follows
    

Page 244

"In the none of the three cases has the party himself been at fault. The widow, the nurse and the man of business, each one of them wanted to get on. The fault, I regret to say, has been with the legal advisers. It is not that they willfully neglected the cases. But they have put them on one side, sometimes for months, and even for years, because of the pressure of other work or of other claims on their time."

Page 245

"To this there is a short answer. The delay of justice is a denial of justice. Magna Carta will have none of it. "To no one will we deny or delay right or justice."

It was argued before us that the court should never, on the first application, dismiss the action. Even if there was long delay, the court should always give the dilatory solicitor one more chance. The order should be that the action should be dismissed "unless" he takes the next step within a stated time. Such has been the practice, it was said, for a great many years. It was confirmed by Sir George Jessel M.R. in Eaton v. Storer and it should not be changed without prior notice. I cannot accept this suggestion. If there were such a practice, there would be no sanction whatever against delay. The plaintiff's solicitor could put a case on one side as long as he pleased without fear of the consequences.

If you read Eaton v Storer carefully, you will see that the practice described by SIR George Jessel applies only to moderate delays to two or three months. It does not apply when "there is some special circumstance such as excessive delay". (emphasis is mine)

14. Lord Denning categorically refused the need of 'unless' order to strike out an action and this has not been overruled in Diplock in Birkett v James [1978] A.C. 297 though certain other findings were overruled as regard to the consideration of effective remedy against the solicitors.
    
15. In Allen v Sir Alfred Mc Alpine & Sons Ltd et al [1968] 2 Q.B 229 DIPLOCK L.J who a decade later in Birkett v James [1978] A.C. 297 affirmed major part of earlier judgment. The following passages were not overruled subsequently as the only deviation was regarding the consideration of effective remedy against their own solicitor who delayed the action.
    
16. Allen v Sir Alfred Mc Alpine & Sons Ltd et al [1968] 2 Q.B 229 at Page 254
    

"The procedure of the English courts is based upon the adversary system. The underlying principle of civil litigation is that the court takes no action in it of its own motion but only on the application of one or other of the parties to the litigation, the assumption being that each will be regardful of his own interest and take whatever procedural steps are necessary to advance his cause.

So long as the solicitor is diligent in his duty to his client, the assumption that there will be taken timeously whatever procedural steps are necessary to advance the party's cause is valid, and the adversary system works. But the assumption is falsified and our system for administering justice is in danger of breaking down if the solicitor either deliberately or through forgetfulness puts his own convenience before the interests of his client in a particular action." (emphasis is mine)

Page 255

"The chances of the court's being able to find out what really happened are progressively reduced as time goes on. This puts justice to the hazard. If the trial is allowed to proceed, this is more likely to operate to the prejudice of the plaintiff on whom the onus of satisfying the court as to what happened generally lies. But there may come a time when the interval between the events alleged to constitute the cause of action and the trial of the action is so prolonged that there is a substantial risk that a fair trial of the issues will be no longer possible. When this stage has been reached, the public interest in the administration of justice demands that the action should no be allowed to proceed." (emphasis is mine)

Page 256

"Delay which justifies dismissal of an action for want of prosecution, as distinct from dismissal for disobedience to a peremptory order of the court, is ex hypothesis so prolonged that it involves a serious risk that there will not be a fair trial of the issues."

SALMON L.J in Allen v Sir Alfred Mc Alpine & Sons Ltd et al [1968] 2 Q.B 229 held at

Page 267

"It is much in the interests of solicitors as a whole as it is of everyone else that the grossly inordinate and inexcusable delays which sometimes disfigure litigation should cease.

The real evil, however, lies in those cases which, for no reason at all, save sheer dilatoriness on the part of the plaintiff's solicitor, do not come on for trial until many years, sometimes five, six or even ten years after the accident out of which they arose."

Page 269

"It must consider also the prejudice which the plaintiff may suffer in having his action dismissed, bearing in mind the apparent merits of his case, and not forgetting the fact that it was his agent and not the defendant who caused the delay. In the end, the court must decide whether or not on balance justice demands that the action should be dismissed."

Page 270

"Nor can I accept the argument that an application to dismiss an action for want of prosecution should not succeed unless the plaintiff's solicitor has first been warned by the defendant and continued the delay after the warning. To accede to this argument would be an encouragement to the careless and lethargic................On this point I cannot usefully add anything further to what has fallen from my Lords or to what I have said about it in Fitzpatrick's case. ([1967] 1 WLR 706).

They have no idea that it is usually the fault of their own solicitor that their case has been tried or settled long ago. Whenever such cases are dismissed for want of prosecution, the court should, in my view take steps to ensure that the plaintiff is personally informed of the decision and briefly of the reasons for which it was made." (emphasis is mine)

100. CONCLUSION
     

17. There is no need of unless order to strike out an action for want of prosecution. This is expressly stated in Allen v Sir Alfred Mc Alpine & Sons Ltd et al [1968] 2 Q.B 229 by Lord Denning. In this action the Plaintiff is alleging wrongful termination. The cause of action alleged in the statement of claim is based on contract. The plaintiff is alleging breach of some implied conditions as well. The alleged cause of action for wrongful termination on the written contract allegedly occurred on 14th March, 2008. The time period for limitation has not expired, and in the circumstances, based on the ratio of the judgment of Lord Diplock where his lordship stated 'non-expiry of the limitation period is generally a conclusive reason for not dismissing the action that is already pending,' the summons for strike out is dismissed, but considering the delay I would make further orders as to the progress of this action without delay as follows.
    

4. FINAL ORDERS
   
   1. The summons to strike out the action is dismissed.
   2. The Plaintiff is ordered to deposit the security for cost forthwith.
   100. If the security for cost is not deposited within 7 days from today, the plaintiff's action is deemed struck off.
   4. The Plaintiff is further directed to file and serve the summons for direction within 7 days from today.
   5. If no summons for directions filed within 7 days the plaintiff's action will be struck off.
   6. The cost of this application will be cost in the cause.
      

Dated at Suva this 9th day of October, 2012.

.................................................
Master Deepthi Amaratunga
High Court, Suva