Industrial Supplies (Fiji) Ltd v Parmars Lautoka [2014] FJHC 93; HBC50.2011 (25 February 2014)

IN THE HIGH COURT OF FIJI
AT LAUTOKA
CIVIL JURISIDCTION

Civil Action HBC No. 50 of 2011

BETWEEN:

INDUSTRIAL SUPPLIES (Fiji) LIMITED
a limited liability company having its registered office at Bouwalu Street, Lautoka in the Republic of Fiji Islands.
PLAINTIFF

AND:

PARMARS LAUTOKA
a limited liability company having its registered office at Lautoka.
DEFENDANT

RULING

INTRODUCTION

1. The plaintiff’s statement of claim, filed on 11 April 2011, claims that it (plaintiff) is the duly authorised and exclusive marketer and agent for safety shoes produced and marketed under the trade name of “Safety Joggers”. This product is produced by a company called Cortina China Limited (“CCL”).
   
2. It is alleged that the defendant is advertising its products under the name of “Safety Joggers” and thereby breaching the plaintiff’s exclusive rights and which breach is depriving the plaintiff of sales and profits.
   
3. It is also specifically alleged that the defendant has made false and disparaging comments about the plaintiff’s product and has deliberately trying to undermine the goodwill between the plaintiff and CCL. There is a particular pleading alleging that the defendant has also breached the provisions of the Fair Trading Decree and has acted in an unfair and unconscionable manner, although no particular provisions of the said Decree is mentioned, nor are the particulars of the alleged unfair and unconscionable conduct pleaded.
   
4. The defendant does not say that the alleged exclusive agreement harms competition in any way and, consequently, should be declared invalid under the same Decree. However, it pleads that it also holds a license from CCL to market the same product. Is CCL then the party that has breached its exclusive agreement with the plaintiff?
   
5. The defendant has filed a summons to strike out under Order 18 Rule 18(1)(a) on the ground that the claim discloses no reasonable cause of action.
   

THE LAW

6. The jurisdiction to strike out proceedings under Order 18 Rule 18 is guardedly exercised in exceptional cases only where, on the pleaded facts, the plaintiff could not succeed as a matter of law. It is not exercised where legal questions of importance are raised and where the cause of action must be so clearly untenable that they cannot possibly succeed (see Attorney General –v- Shiu Prasad Halka 18 FLR 210 at 215, as per Justice Gould VP; see also New Zealand Court of Appeal decision in Attorney -v- Prince Gardner [1998] 1 NZLR 262 at 267.
   
7. His Lordship Mr Justice Kirby in Len Lindon -v- The Commonwealth of Australia (No. 2) S. 96/005 summarised the applicable principles as follows:-
   

1. it is a serious matter to deprive a person of access to the courts of law for it is there that the rule of law is upheld, including against Government and other powerful interests. This is why relief, whether under O 26 r 18 or in the inherent jurisdiction of the Court, is rarely and sparingly provided.

2. to secure such relief, the party seeking it must show that it is clear, on the face of the opponent's documents, that the opponent lacks a reasonable cause of action ....or is advancing a claim that is clearly frivolous or vexatious...

3. an opinion of the Court that a case appears weak and such that it is unlikely to succeed is not, alone, sufficient to warrant summary termination......Even a weak case is entitled to the time of a court. Experience teaches that the concentration of attention, elaborated evidence and argument and extended time for reflection will sometimes turn an apparently unpromising cause into a successful judgment.

4. summary relief of the kind provided for by O 26 r 18, for absence of a reasonable cause of action, is not a substitute for proceeding by way of demurrer....... If there is a serious legal question to be determined, it should ordinarily be determined at a trial for the proof of facts may sometimes assist the judicial mind to understand and apply the law that is invoked and to do so in circumstances more conducive to deciding a real case involving actual litigants rather than one determined on imagined or assumed facts.

5. if, notwithstanding the defects of pleadings, it appears that a party may have a reasonable cause of action which it has failed to put in proper form, a court will ordinarily allow that party to reframe its pleading ......A question has arisen as to whether O 26 r 18 applies to part only of a pleading

6. The guiding principle is, as stated in O 26 r 18(2), doing what is just. If it is clear that proceedings within the concept of the pleading under scrutiny are doomed to fail, the Court should dismiss the action to protect the defendant from being further troubled, to save the plaintiff from further costs and disappointment and to relieve the Court of the burden of further wasted time which could be devoted to the determination of claims which have legal merit.

COMMENTS & CONCLUSION

8. The plaintiff is pleading an exclusive right to market the product in question. The details of this arrangement are not pleaded. What the defendant says however is that:
   

...the defendant is advertising Safety Joggers under the licence and authority of CCL ....

9. These are all triable issues. I am of the view that the facts as pleaded do disclose a reasonable cause of action. Admittedly, the plaintiff's case is not well pleaded. But these could be addressed appropriately through an application to amend pleadings. Accordingly, I dismiss the application to strike out the claim.
   
10. Costs in the cause. Case is adjourned to Monday 10 March 2014 at 8.30 a.m for mention before Master Ajmeer. Matter to take normal course.
    

...............................
Anare Tuilevuka
JUDGE

24 February 2014