Wonderland Real Estate v Tikalou [2015] FJHC 574; HBA06.2012 (6 August 2015)

IN THE HIGH COURT OF FIJI
WESTERN DIVISION AT LAUTOKA
APPELLATE JURISDICTION

Civil Appeal No. HBA 06 of 2012

BETWEEN:

WONDERLAND REAL ESTATE
of Naviti Street, Lautoka
APPELLANT

AND:

ASESELABA TIKALOU
of Rifle Range, Lautoka
RESPONDENT

Counsel : Ms Q. Vokanavanua for Appellant
Mr K Tunidau for Respondent

Date of Judgment: 6 August 2015

JUDGMENT

Introduction

[1] This judgment concerns an appeal filed by appellant against the ruling dated 16 September 2011 of learned Magistrate sitting at Lautoka on the following grounds of appeal namely:

1. THE Learned Magistrate erred in Law and facts when he granted leave to appeal out of time to the Respondent without taking into consideration all the relevant considerations.
   
2. THE Learned Magistrate erred in Law and facts in not taking into consideration all the relevant facts and taking into account irrelevant facts when he made an Order against the Appellant for payment of costs in the sum of $1,000.00 (One Thousand Dollars).
   

100. THE Learned Magistrate erred in law and facts when he allowed the Respondent's Appeal against the Ruling made by the Learned Tribunal.
     

[2] The appeal was listed for hearing on 23 April 2012 before Y I Fernando, J when both parties agreed that the appeal may be decided on the submissions. As such, Fernando, J allowed both parties to file their relevant written submissions within seven days. However, only the appellant had filed the written submissions. The respondent did not file any.

[3] Unfortunately, Fernando, J could not deliver the judgment before he left the bench in 2013.

[4] The matter is now listed before me to deliver the judgment. I propose to deliver my judgment upon reading the materials that are available on the record.

Facts of the case

[5] The appellant was the applicant in the Small Claim Tribunal ('SCT'). It filed an application in the SCT claiming the sum of $1493.17 against the respondent. On 3 August 2010 the appellant served the application on the respondent. The returnable date of the summons was 25 August 2010. On the returnable day the Respondent did not appear in the SCT. The SCT set down the matter for ex parte hearing on 8 October, 2010. The STC after hearing the appellant entered a default judgment against the Respondent. The appellant filed a Judgment Debtor Summons ('JDS') in the Magistrates' Court at Lautoka to execute the judgment. The JDS application was served on the respondent. On 15 June 2011 the respondent filed a motion to set aside the JDS. On 23 June 2011 the respondent filed another motion in the Magistrates' Court to seek leave to appeal out of time. The learned Magistrate dealt with both applications together. The learned Magistrate in his ruling dated 16 September 2011 ordered that: '1. The application for leave to appeal out of time is allowed. 2. The Judgment Debtor Summons dated 4th of February 2011 is set aside. 3. The cost is summarily assessed in the sum of $1000.00.' The current appeal to this court is against that decision.

Determination

[6] The appellant appeals a decision made by learned Magistrate sitting at Lautoka. This decision was made in the respondent's application for leave to appeal out of time an ex parte judgment entered by the SCT against him. In his decision the learned Magistrate granted leave to appeal out of time and set aside the JDS and ordered summarily assessed cost of $1000.00.

[7] The issue to be determined by this court in this appeal is whether the learned Magistrate erred in granting leave to appeal out of time an ex parte judgment made by the SCT.

[8] It is pertinent to note that the learned Referee at the STC granted Default Judgment in favour of the appellant when the respondent failed to appear before the SCT after summons being issued and served on the respondent.

[9] Counsel for the appellant submits that, no appeal can be made on default judgment. Even in the Magistrate's Court Rule ('MCR') there is no provision to appeal a default judgment. One can only make application to appeal out of time if the decision by the Lower Court is made after the conduct of the hearing wherein both parties are heard.

[10] Unfortunately, the respondent did not make any submission on this issue. Although the court granted time for the respondent to file his written submission, he failed to do so.

[11] It will be noted that there is no explicit provision in the Small Claim Tribunal Decree ('SCTD') to set aside default judgment. However, it has provisions for rehearing under s. 32 which provides as follows:

'32.-(1) Subject to subsection (2), a Tribunal may, upon the application or[f] a party to any proceedings, order the rehearing of a claim, to be had [sic] upon such terms as it thinks&#1t.

(2) A rehearing may be ordered under subsection (1) only if an order has been made under section 15(6) or section 31(2) and, in the lattse, shall be limited to rehearing the enforcement proceedineedings taken under that section

(3) Every aery application for a rehearing shall be in Form 5 of the first Schedule, shall be lodged together with the fee prescribed in the Second Sch and be made within 14 days after the Tribunal's orde order andr and shall be served upon the other parties to the proceed

(4) Whe) When a rehearing is ordered:

(a) the Registrar shall notify all parties to the prongs o maki the order and of the time and place appointed for the rehearing; and

(b) the order of the Tri made tpon the first hearing shall cease to have effect.

(5) Notwithstanding subsection (4)(b), if the party ose application a rehearing is ordered does not appear at the time and place for the rehearehearing or at any time and place to which the rehearing is adjourned, the Tribunal may, without rehearing or further rehearing the claim direct that the original order be restored to full for60;an0;ef60;effect.

(6) This Decree shall apply to a rehearing in all respects as it applies to an original hearing' (Emphasis provided).

[12] Under s. 15-(6) of the STCD, the Tribunal may grant relief in respect of any claim which is not disputed. In doing so, the Tribunal can make one or more of the orders which is empowered to make under s.16 or under any other law.

[13] The STC had entered default judgment in favour of the appellant on the basis that the claim was not disputed as the respondent failed to appear before the Tribunal.

[14] Since the STC entered the default judgment on the ground that the claim was not disputed, the respondent had every opportunity to make application under s.32 for rehearing. The respondent failed to do so. Instead of making an application for rehearing in the STC, the respondent filed in the Magistrate's Court an application for leave to appeal the default judgment out of time.That application emerged only after the appellant commenced execution proceedings by way of JDS to execute the default judgment.

[15] The learned Magistrate granted leave to appeal out of time when he also set aside the JDS dated 4 February 2011 and filed by the appellant with the cost of $1000.00 to be paid by the appellant to the respondent. Unfortunately, the learned Magistrate did not set a time limit within which the respondent should file his appeal. As a result of it, the respondent never filed an appeal in the Magistrate's Court. The respondent was happy with set setting aside of the JDS and he lost interest in the matter.

[16] What must be emphasised here is that when granting leave to appeal out of time the learned Magistrate would have set a time limit within which the appeal should be filed and it is always preferable to set the time frame with an unless-order that the appeal will be deemed to have been abandoned if the appeal were not filed within that time frame set by the court.

[17] It is to be noted that the SCTD has no explicit provisions that allow the Referee to set aside a default judgment. However, s.29 of the STCD empowers an STC to adopt suitable procedure where no provision is made. S.29 provides as follows:

'Subject to this Decree and any rules made hereunder, a Tribunal shall adopt such procedure as it thinks best suited to the ends of justice.'

[18] 'MCR' under Order XXX Rule 5 carries provisions in relation to set aside set aside a judgment made in absence of a party. Therefore an SCT may exercise jurisdiction given to a Magistrate's Court under O.XXX, r.5 to set aside a default judgment because s.29 of the STCD allows doing so, in order to meet the ends of justice.

[19] The respondent, in my opinion, should have made either an application before the STC for rehearing under s.32 or an application to set aside the default judgment delivered against him. The respondent without seeking either of the two remedies that were available to him, he opted to file an application to seek leave to appeal out of time.

[20] In WEA Records Ltd v. Visions Channel 4 Ltd., and Others [1983] 1 WLR 721, Sir John Donaldson, M.R. with Dunn and Purchas L. JJ agreeing dismissed the appeal not on the merits but on the ground that it is an abuse of process of the court. And Donaldson, M.R further observed that:

'... Ex parte orders are essentially provisional in nature. They are made by the Judge on the basis of evidence and submissions emanating from one side only. Despite the fact that the applicant is under a dutyto make full disclosure of all relevant information in his possession, whether or not it assists its application, this no basis for making a definitive order and every Judge knows this. He expects at a later stage to be given an opportunity to review his provisional order in the light of evidence and argument adduced by the other side and, in so doing, he is not hearing an appeal from himself and in no way feels inhibited from discharging or varying his original order.

This being the case it is difficult, if not impossible to think of circumstances in which it would be proper to appeal to this court against an ex parte order without first affording the Judge who made it or, if he is not available, another High Court Judge an opportunity of reviewing it in the light of arguments from the defendant and reaching a decision. This is the appropriate procedure to be followed even when an order is not provisional, but is made at the trial in the absence of one party.'(Emphasis provided).

[21] The above case was cited by Fiji Court of Appeal (Calanchini, P, and Lecamwasam and Kumar, JJA) in Public Employees Union v Kumar Sami Reddy [Civil Appeal No: ABU 0037 of 2011 (High Court Civil Action No. HBC 220 of 2010)].

[22] On default judgment and setting aside default judgment Halsbury's Laws of England (4th Ed, Vol. 37) under paras. 393 & 403 states as follows:

'A judgment in default is not a judgment on the merits, but it is expression of the coercive power of the court where the default judgment has only been obtained by a failure to follow any of the rules of procedure or orders of the court. Accordingly, no appeal lies against a default judgment, but the court had power to set it aside or to vary it. Nevertheless, while it stands, a default judgment has many of the attributes of a judgment after trial.

A defendant against whom a default judgment has been entered, either for failure to give notice of intension to defend or failure to serve a defence or appear at the trial, may apply to the court without the need to obtain leave, even where he has failed to give notice of intension to defend. The application should, of course, be made promptly and within a reasonable time of getting to know of the judgment.' (Emphasis added).

Conclusion

[23] I, for the reasons given above, would conclude that the respondent should have made either (i) an application for rehearing under s.32 of SCTD or (ii) an application to set aside the default judgment delivered against him by the SCT for failure to appear at the trial. It was not proper for the respondent to appeal to the Magistrate's Court against an ex parte order without first affording the Referee who made it or, if he is not available, another Referee an opportunity of reviewing it or rehearing the matter in the light of arguments from the respondent and reaching a decision. This means that there is no appeal lies against a default judgment. Therefore, it was an abuse of process of the court to make application for leave to appeal out of time a default judgment. In my view the learned Magistrate fell into error when he granted leave to appeal out of time an ex parte order and setting aside the JDS with the costs of $1000.00. I accordingly set aside the learned Magistrate's decision granting leave to appeal out of time a default judgment. I would make no order as to costs.

Orders of the court

1. Appeal allowed.
2. Magistrate's decision set aside
3. No order as to costs.
   

...........................................
M H Mohamed Ajmeer
JUDGE

At Lautoka
6 August 2015