Praveena's BP Service Station Ltd v BP South West Pacific Ltd [2012] FJHC 871; HBC093.2005 (14 February 2012)

IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION

Civil Action No. HBC 093 of 2005

BETWEEN:

PRAVEENA'S BP SERVICE STATION LIMITED a limited liability company having its registered office at its Service Station premises at Kings Road, Ba Town, Fiji
PLAINTIFF

AND:

BP SOUTH WEST PACIFIC LIMITED a company having its registered office at 7th Floor, Vanua House, Victoria Parade, P O Box 118, Suva, Fiji
FIRST DEFENDANT

AND:

NEMANI KOBITI of Palm Drive, Delainavesi, Suva, Retail & Reseller, Business Manager.
SECOND DEFENDANT

BEFORE: Master Deepthi Amaratunga

COUNSEL: Ms. Kenelorea for the Plaintiff
Ms. Devan S P. for the Defendant

Date of Hearing: 3rd November, 2010
Date of Ruling: 14th February, 2012

RULING

1. INTRODUCTION
   

1. The Plaintiff has filled this action to remove the caveats and for alleged damages by the lodgment of three caveats on three properties by the 1st and 2nd Defendants. One out of the three caveats one caveat was ordered to be removed and the other two remained over the said properties. The Defendant has installed equipment on the said three properties and claimed caveatable interest as a Lessor and court has unequivocally held that Defendants were not clearly lessors on the property on which the caveat was removed. The Court held that at least one caveat was lodged without a caveatable interest. The Defendant has filled this summons for strike out on the basis that the payment made in pursuant to the settlement in action HBC 56 of 2005.
   

2. FACTS
   

2. This action was instituted on 10th March, 2005 by way of originating summons seeking removal of three caveats and damages and for costs.
   
3. On 2nd June, 2005 upon an order of the court the Plaintiff filled a statement of claim seeking damages for the lodgment of caveats by the Defendants.
   
4. The Plaiintiff and 1st Defendant, in another action HBC 056 of 2004 has entered terms of settlement on 23rd September, 2008 as follows
   

"a. The Defendant shall pay the sum of $150,000 into the trust Account of Mishra Prakash & Associates within seven days of the date hereof by way of Bank cheque.

2. The Plaintiff and the Defendant shall withdraw and/or discontinue all acitons in respect of the matters contained in this claim and counter-claim including matters in Fiji Court of Appeal.
   

100. The Defendant shall forthwith withdraw it Proof(s) of Debt lodged with the Official Receiver within 10 days and the payment of $150,000 shall be in full and final settlement of any liabilities in respect of the proceedings mentioned herein.
     

4. It shall be the responsibility of the Plaintiff to deal with the official receiver.'
   

100. ANALYSIS AND LAW
     

5. The Defendant state that the said settlement reached in HBC 056 of 2004 includes the claim in this case, but I have not been submitted the statement of claim in that case by both parties to determine the whether the said settlement covers the action before me. This is primarily the responsibility of the Defendant who is seeking strike out of this action based on the said settlement that was entered in the court, but it has not done so. Though the Plaintiff objects to this summons and state that the said settlement does not include the present action they have also not filled the pleading in the said action of HBC 056 of 2004, which would have easily resolved the issue, without much difficulty.
   
6. I have been submitted, an affidavit marked NK 13 to the affidavit in support, and that affidavit was filled in relation to the assessment of damages in the said case of HBC 056 of 2004 and this does not specifically deals with the issue of the caveats and alleged damage due to lodgement of them over the three properties.
   
7. The Defendants' summons to strike out is made under Order 18 rule 18 (1) (a), (b) and (c) though the heading of the summons contain Order 18 rule 18 (1) (a)(b) and (d) though this has been taken as an objection by the Plaintiff I do not think that this irregularity has prejudiced any body and in any event this cannot be a ground for strike out of the summons, in terms of Order 2 rule 2 (1) & 2 (2) of the High Court Rules of 1988.
   
8. Before the hearing of the strike out application, the Defendants objected to paragraph 18 of the Plaintiff's Affidavit in reply. After much discussion, the Court indicated that it will not take into account paragraph 18 of the affidavit when considering the Defendant's application and parties agreed to said compromise and I will not consider the said averment in this decision as it deals with an issue that is not before me.
   

Order 18 Rule 18(1) (a), (b), and (c) reads as follows:-

(a) The claim discloses no reasonable cause of action;

(b) It is scandalous, frivolous or vexatious;

(c) It may prejudice, embarrass or delay the fair trial of the action

9. There has been an affidavit of Nemani Kobiti filed on the 4th June 2010 and another one on the 19th of October 2919. There is affidavit evidence and Order 18 Rule 18(2) of the High Court Rules 1988 which states as follows:
   

"(2) No evidence shall be admissible on an application under paragraph 1(a)."

10. Thus the affidavits filed are not able to be used in relation to the Order 18 rule 18 (1)(a). Nothing in the affidavits restricts use of the affidavits to sub-paragraphs (b) and (c). No affidavit evidence is permitted with respect to the first ground for striking out. Order 18 Rule 1 of the High Court Rules 1988 relied upon by the Defendant has specific law relating to it.
    
11. The over-riding principle is that such applications are only granted in the clearest of cases so that a Plaintiff is not deprived of his cause of action or relief without a proper and full hearing.
    
12. Footnote 18/19/3 of the 1988 Supreme Court Practice where the following is stated in respect of applications such as the present:-
    

"It is only plain and obvious cases that recourse should be had to the summary process under this rule, per Lindley MR. in Hubbuck v. Wilkinson [1898] UKLawRpKQB 176; (1899) 1 Q.B. 86, p91(Mayor, etc., of the City of London v. Homer (1914) 111 L.T. 512, CA). See also Kemsley v. Foot and Qrs. (1951) 2KB. 34; (1951) 1 All ER. 331, CA. affirmed (1952) AC. 345, H.L. The summary procedure under this rule can only be adopted when it can be clearly seen that a claim or answer is on the face of it obviously unsustainable' (Att-Gen. of Duchy of Lancaster v. L. & N.W. Ry. Co. [1892] UKLawRpCh 134; (1892) 3 Ch. 274, CA). The summary remedy under this rule is only to be applied in plain and obvious cases when the action is one which cannot succeed or is in some way an abuse of the process or the case unarguable (see per Danckwerts and Salmon L.JJ. in Nagle V. Feliden (1966) 2 Q.B. 633, pp. 648, 651, applied in Drummond Jackson v. British Medical Association (1970) 1 W.L.R. 688 (1970) 1 All ER 1094, CA). (emphasis is added)

13. The Plaintiff's statement of claim is on the basis that the Defendants had lodged caveats on the 10th day of December 2004 against the Plaintiffs titles. Clauses 1, 2 and 3 of the statement of claim reads as follows:-
    

"1. The Plaintiff is the registered proprietor of Crown Lease Nos 38764 and 38765 and Native Lease No. 22248.

2. The Plaintiff had entered into Agreements for Sale and Purchase of Native Lease No. 22248 and Crown Lease No. 38765. Settlement was to take place on Friday the 18th day of February 2005.

3. Neither of the defendants have any interest in the subject properties but they had jointly lodged Caveat Nos 555731, 555732 and 555733 dated 10th of December 2004 against the above-mentioned titles."

14. It is also pleaded in the Statement of Claim paragraphs 6 and 7 that the Plaintiff took High Court Action No. 093 of 2005 for removal of the caveats. Paragraph 7 clearly pleads Caveat No. 555733 over Native Lease No. 22248 was ordered to be removed forthwith.
    
15. As to the other two caveats the Defendants were allowed to keep the same on. The basis on which Justice Singh allowed the continuance of the same on the two Crown Leases were as follows and he quoted Justice Fatiaki on page 4 of the decision:
    

"Justice Fatiaki (now the Chief Justice) in Sir Sathi Narain v. Phyllis Kathleen Malley – 34 FLR 118 at 121C stated that "it is inappropriate for this course at this stage to determine the rights of the parties to this action in a summary manner particularly where there are conflicting affidavits or where the question of a caveatable interest is distinctly arguable one"

He therefore suggested a "distinctly arguable" test which the Caveator has to satisfy to justify continued existence of a caveat pending full hearing."

16. In regard to the first caveat on the Native Lease, on page 5 it was stated that;
    

"However the caveat number 555733 over Native Lease 22248 is concerned, there was no deed of lease over this property. There is no nexus between the Deed of Lease dated 16th June 1999 and this land. Mr. Fa countered this by submitting that the defendants had carried out improvements on this land. However, that is shifting grounds for caveat. A caveator cannot shift his grounds for lodging his caveat."

Page 6

"However caveat number 555733 over Native Lease 22248 is ordered to be removed forthwith".

17. The Plaintiff was thus successful in removing Caveat No. 55573 over Native Lease No. 22248 and in this aciton the Plaintiff is claiming as follows
    

(b) Damages and interest be paid by the Defendants to the Plaintiff which is to be assessed by the Judge and/or Deputy Registrar of the High Court.

(c) Defendants do pay damages to the Plaintiff in respect of the Caveat against Native Lease No. 22248.

(d) The Defendants do pay damages to the Plaintiff in respect of the caveat against Crown Lease No. 38764 and 38765.

(e) Interest at 10% per annum.

(f) Costs to be taxed if not agreed.

18. Section 114 of the Land Transfer Act which specifically provides as follows:-
    

Compensation for lodging caveat without reasonable cause

114. Any person lodging any caveat with the Registrar without reasonable cause shall be liable to make, to any person who may have sustained damage thereby, such compensation as the court shall order and such compensation may be recovered by proceedings at law if the caveator has withdrawn such caveat and no proceedings have been taken by the caveatee then such compensation shall be decided by the court acting in the same proceedings..."

19. This gives the Plaintiff cause of action under the Land Transfer Act and for breach of its right in respect of caveats being lodged without just cause on its titles, this aspect of the claim cannot be dealt by the affidavits and clearly cannot be considered as subject matter of strike out. Even if there is no damage as alleged by the Defendants, the court can grant nominal damages taking in to consideration of the circumstances of the case. In this case already Justice Singh has held that as regards to Caveat 55573 there was no caveatable interest as stated in the caveat and has also stated that the caveator cannot shift the interest stated in the caveat. So, the court has already held that as regards to the said property the Defendants lacked caveatabel interest as the lessors, as stated in the caveat. So, prima facie there should also be a claim for wrongful lodgment of the caveat, that was removed by an order of the court.
    
20. The Defendants seeks to rely on the settlement of High Court Action No. 056 of 2004 as an estoppels in this case. That Terms of Settlement was in respect of that action and is dated 23rd September, 2008 and it clearly provides that it is in respect of that action and the Appeal relating thereto. The only leeway that was allowed in the said terms of settlemt is the use of words 'discontinue all actions in respect of the matters contained in this claim and counter-claim..' but if the Defendant seeks to include the present claim to the said term of settlement, it has to establish that the damages sought here were in fact included in the said action. The Defendants have not done so, by filling the statement of claim in that case and this alone would be sufficient to dismiss this application for strike out.
    
21. The settlement makes no mention of the present case which was a separate cause of action based on wrongful lodgement of caveats against the Plaintiff's title. Mr. Tulsi Ram Khelawan the Managing Director of the Plaintiff had also given an affidavit which is "NK13" in that action and the absence of the matters relating to damages for wrongful lodgement of caveats also indicate that this aspect has not been covered in the said case.
    
22. Whether the Defendant had just cause in lodging Caveats against the two Crown Leases can only be determined after hearing oral evidence at trial.
    
23. Footnote 18/19/3 of the 1988 Supreme Court Practice where the following is stated in relation to the exercise of the Court's power under this rule:-
    

"It cannot be exercised by a minute and protracted examination of the documents and facts of the case, in order to see whether the plaintiff really has a cause of action (Wenlock v. Moloney (1965) 1 W.L.R. 1238; (1965) 2 All ER. 871, CA)".

Footnote 18/19/4 of the 1988 Supreme Court Practice where the following is stated in relation to striking out applications:-

"On an application to strike out the statement of claim and to dismiss the action, it is not permissible to try the action on affidavits when the facts and issues are in dispute (Wenlock v. Moloney [1965] 1. W.L.R. 1238; [1965] 2 All E.R. 87, CA).

It has been said that the Court will not permit a plaintiff to be 'driven from the judgment seat' except where the cause of action is obviously bad and almost incontestably bad (per Fletcher Moulton L.J. in Dyson v. Att.-Gen. [1910] UKLawRpKQB 203; [1911] 1 KB 410 p. 419)."

24. In the case of Electricity Corporation Ltd v Geotherm Energy Ltd [1992] 2 NZLR 641, where the headnote at kube 50 states as follows:-
    

"Held: 1 The jurisdiction to strike our a pleading for failure to disclose a cause of action is to be sparingly exercised and only in a clear case where the Court is satisfied that it has all the requisite material to reach a definite and certain conclusion; the plaintiff's case must be so clearly untenable that it could not possibly success and the Court would approach the application, assuming that all the allegations in the statement of claim were factually correct (see p 645 line 25)." (the underlining is ours)

25. The Fiji Court of Appeal has applied similar principles in National MBF Finance (Fiji) Ltd v Buli, Fiji Court of Appeal Civil Appeal No. ABU 0057 of 1998S (6 July 2000) at page 2 of 4, second paragraph, where it stated as follows:-
    

"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. The Judge's task was also made more difficult by the wording of both statements of claim and defence which do not raise the questions at issue with clarify."

26. Here there is a considerable amount of evidence which will have to be taken in respect of the Caveats and the Defendants will have to justify the reasons for the lodgment of the caveats and this cannot be done through only through documentary evidence.
    

4. CONCLUSION
   

27. Clearly this is not a matter for strike out. The Plaintiff is seeking damages for the lodgement of three caveats and at least one caveat was ordered removed and prima facie any loss due to the lodgement can be claimed by the caveatee. On the affidavit evidence I cannot reject such a calim for damages as that needs a hearing of the matter to assess the damages sometimes even nominal damages can be awarded without the proof of actual damages, and this should be dealt by a judge at trial.
    
28. The summons for strike out the statement of claim is dismissed and struck out and the plaintiff is also granted a cost of $1,000 assessed summarily to be paid by the Defendants within 21 days.
    

5. FINAL ORDERS
   

1. The summons dated 4th June, 2010 is struck off.
   
2. The Plaintiff is granted a cost of $1,000 assessed summarily to be paid by the Defendants within 21 days.
   

100. Matter should take its normal cause.
     

Dated at Suva this 14th day of February, 2012

Mr. Deepthi Amaratunga
Master of the High Court
Suva