iTaukei Land Trust Board v Fiji Wai Ltd - Ruling [2015] FJHC 630; HBC74.2014 (28 August 2015)

IN THE HIGH COURT OF FIJI
WESTERN DIVISION
AT LAUTOKA

CIVIL JURISDICTION

CIVIL ACTION NO. HBC 74 of 2014

BETWEEN:

ITAUKEI LAND TRUST BOARD
a statutory body registered under the provisions of the iTaukei Land Trust Act Cap 134, Laws of Fiji, and having its registered office at 31 Victoria Parade, Suva
PLAINTIFF

AND :

FIJI WAI LIMITED
a limited liability company having its registered office at Level 2, Provident Plaza 1, 34 Ellery Street, Suva
DEFENDANT

Mr Inoke Buli Lutumailagi for the Plaintiff
Mr Nilesh Prasad for the Defendant

Date of Hearing:- 20th May 2015
Date of Ruling :- 28th August 2015

RULING

(A) INTRODUCTION

1. Before me is the Defendant's Summons pursuant to Order 2, Rule (2), Order 12, Rule (1), (5), (3), (5) and Order 13, Rule (10) of the High Court Rules, 1988 and under the inherent jurisdiction of the Court seeking the grant of the following orders;

(a) the judgment entered in default of Acknowledgement of Service dated 13 February 2015 be set aside for: (i) irregularity (ii) or alternatively, at the discretion of the court if the judgment is ruled to be regular. (b) the Defendant be given leave to defend his action. (c) there be a stay of execution of judgment until determination of this application or further order of this court; (d) the costs of and occasioned by this application to be assessed summarily; and (e) any further or other relief that this court deems just and expedient in the circumstances.

(2) The application is supported by an affidavit sworn by Sakiusa Bolaira, the Company Secretary of the Defendant.

(3) Upon being served with Summons, the Plaintiff appeared in Court and strongly resisted the application. Regrettably, the Plaintiff did not file an Affidavit in Opposition.

(4) The Plaintiff and the Defendant were heard on the Summons. They made oral submissions to Court. In addition to oral submissions, the Defendant filed a careful and comprehensive written submission for which I am most grateful

(B) THE LAW

An application to set aside a default judgment is not the invocation of an appellate jurisdiction but of a specific rule enabling the court to set aside its own orders in certain circumstances where the action has never been heard on the merits.

A Defendant against whom judgment in default has been entered may apply for it to be set aside under Order 13, rule 10 or under Order 19, rule 9 of the High Court Rules.
In situations where the Defendant has failed to file in the first instance, notice of intention to defend, then order 13 procedure is the correct process.

Order 19 is applicable only where, after notice of intention to defend is filed, no statement of defence had followed.

❖ THE PRINCIPLES OF SETTING ASIDE DEFAULT JUDGMENTS

A default judgment can be obtained regularly or irregularly and both of these forms of judgments can be set aside.

However, there is a distinction between setting aside a default judgment for irregularity and setting aside a judgment which was in fact regular.

Fry L J in Alaby –v- Praetorious [1888] UKLawRpKQB 55; [1888] 20 QBD 764 at 769 succinctly drew the distinction as follows:-

"There is a strong distinction between setting aside a default judgment for irregularity in which case the court has no discretion to refuse to set it aside, and setting it aside where the judgment though regular has been obtained through some slip or error on the part of the Defendant in which case the court has a discretion to impose terms as a condition of granting the Defendant relief." (emphasis added).

This principle was adopted and applied by the Fiji Court of Appeal in "Subodh Kumar Mishra v Rent-a-car" (1985) 31 FLR 52. Thus, where an irregular default judgment is entered (for example time for acknowledging service or for serving a defence had not expired by the time the default judgment was entered) which irregularity cannot be cured the Defendant is entitled as of right to have the judgment set aside.

However, where the default judgment had been entered regularly, the Court has a wide discretion and neither Order 13, rule 10 nor Order 19, rule 9 of the High Court Rules impose any restriction in the manner in which the discretion is to be exercised.

The rationale for the unconditional discretion that allows the court to intervene is explained by Lord Atkin in "Evans v Bartlam", 1937 DC 473 as follows;

"The Principle obviously is that unless and until the Court has pronounced a judgement upon the merits or by consent, it is to have the power to revoke the expression of its coercive power where that has only been obtained by a failure to follow any of the rules of procedure."

Lord Atkins pronouncement was endorsed and followed by the Fiji Court of Appeal in The Fiji Sugar Corporation v Mohammed Ismail FLR Vol 34, p75.

The Principles applicable for analysis of the merit of an application to set aside a default judgment are well known and settled. The leading authority is Evans –v- Bartlam [1937] 2 All E.R. 646. The following passage from the judgment of Lord Atkin in "Evans v Bartlam" is pertinent in the subject of principles on which a court acts where it is sought to set aside a regular Default judgment;

"The primary consideration is whether he has merits to which the Court should pay heed; if merits are shown the court will not prima facie desire to let a judgment pass on which there has been no proper adjudication...........The Court might also have regard to the applicant's explanation why he neglected to appear after being served, though as a rule his fault (if any) in that respect can be sufficiently punished by the terms as to costs or otherwise which the Court in its discretion is empowered by the rule to impose."

The principles of that case have been widely adopted in Fiji, and by the Fiji Court of Appeal in Pankanji Bamola & Anor. –v- Moran Ali Civil Appeal No. 50/90 and Wearsmart Textiles Limited –v- General Machinery Hire & Anor Civil Appeal No. ABU0030/97S.

In "Pankaj Bamola & Anor v Moran Ali" (supra) the Court of Appeal held;

It is not sufficient to show a merely "arguable" defence that would justify leave to defend under Order 14; it must both have "a real prospect of success" and "carry some degree of conviction." Thus the court must form a provisional view of the probable outcome of the action.

In Russell v Cox 1983 NZLR 654, McCarthy J held;

"In approaching an application to set aside a judgment which complies with the rule, the Court is not limited in the considerations to which it may have regard, but three have long been considered of dominant importance. They are; 1. That the defendant has a substantial ground of defence; 2. That the delay is reasonably explained; 3. That the plaintiff will not suffer irreparable injury if the judgment is set aside.

A useful summary of the factors to be taken into consideration is to be found under notes to Or. 13 r9/14 of THE SUPREME COURT PRACTICE 1995 Vol. I at p.142 and which is, inter alia, as follows:-

"The purpose of the discretionary power is to avoid the injustice which may be caused if judgment follows automatically on default.The primary consideration in exercising the discretion is whether thedefendant has merits to which the court should pay heed, not as a rule of law but as a matter of common sense, since there is no point in setting aside a judgement if the defendant has no defence, and because, if the defendant can show merits, the court will not prima facie desire to let a judgment pass on which there has been no proper adjudication. Also as a matter of common sense the court will take into account the explanation of the defendant as to how the default occurred.

Therefore the judicially recognised "Tests" may be conveniently listed as follows;

(a) Whether the Defendant has a substantial ground of defence to the claim. (b) Whether the Defendant has a satisfactory explanation for the default judgment. (c) The promptness with which the application is made. (d) Whether the setting aside would cause prejudice to the Plaintiff.

The same legal tests apply under the Magistrate Court rules.

❖ THE DEFENCE ON THE MERITS

The major consideration on an application to set aside a default judgment is whether there is a defence on the merits. The purpose is to avoid injustice. The Defendant is seeking to deprive the claimant of a regular judgment which the claimant has validly obtained in accordance with the rules; this is not something which the court will do lightly.

In Shocked v Goldsmith (1998) 1 All ER 372 at 379ff Legatt LJ said:

"These cases relating to default judgment are authority for the proposition that when considering whether to set aside a default judgment, the question of whether there is a defence on the merits is the dominant feature to be weighed against the applicant's explanation both for the default and any delays, as well as against prejudice to the other party."

The leading case is Evans v Bartlam [1937] 2 All 646, [1937] AC 473. In this case, the defendant had suffered judgement to be entered against him in default of appearance. The Court of Appeal ([1936] 1 KB 202) allowed an appeal from the judge's order setting aside the judgement. But the House of Lords reversed the decision of the Court of Appeal and restored the Judge's order.

Lord Wright ([1937] 2 All ER 646 at 656, [1937] AC 473 at 489) expressed the conclusion;

"In a case like the present, there is a judgment, which, though by default, is a regular judgment, and the applicant must show grounds why the discretion to set aside should be exercised in his favour. The primary consideration is whether he has merits to which the court should pay heed; if merits are shown, the court will not prima facie desire to let a judgment pass on which there has been no proper adjudication... The court might also have regard to the applicant's explanation why he neglected to appear after being served, though as a rule his fault (if any) in that respect can be sufficiently punished by the terms, as to costs, or otherwise, which the court, in its discretion, is empowered by the rule to impose."

In Vann V Awford (1986) 130 SJ 682, the judge declined to set aside a judgment given against the second defendant in default of appearance, and also a judgement given against him when damages were assessed in his absence. The Defendant had lied when he said on oath that he had no knowledge of the proceedings. On appeal Dillon LJ considered that, despite the prejudice to the plaintiffs, as there were ample arguable defences the award should be set aside and there should be a fresh hearing. He added: "Even for lying and attempting to deceive the court, a judgement for £53,000 plus is an excessive penalty if there are arguable defences on the merits."

This case was followed two weeks later by The Saudi Eagle [1986] 2 Lloyd's Rep 221. After reviewing Evans v Bartlam and Vann v Awford, Sir Roger Ormrod came to the conclusion that the defendants in the case before the court had failed to show that their defence enjoyed a real prospect of success.

These cases relating to default judgments are authority for the proposition that when considering whether to set aside a default judgment, the question of whether there is a defence on the merits is the dominant feature to be weighed against the applicant's explanation both for the default and for any delay, as well as against prejudice to the other party.

❖ THE YARDSTICK THAT HAS TO BE APPLIED IN DETERMINING THE MERITS OF THE DEFENCE

The Defendant must have a case with a real prospect of success, and it is not enough to show a merely arguable defence. (Alpine Bulk Transport Company v Saudi Eagle Shipping Company, 1986 2 Lloyds Report, P 221).

It must both have "a real prospect of success" and "carry some decree of conviction". Thus the court must form a provisional view of the probable outcome of the action. Unless potentially credible affidavit evidence demonstrates a real likelihood that a Defendant will succeed on fact, no real prospect of success is shown and relief should be refused. (Wearsmart Textiles Ltd v General Machinery Hire Ltd, (1998) FJCA 26.)

A person, who holds a regular judgment even a default judgment, has something of value, and in order to avoid injustice he should not be deprived of it without good reason. Something more than merely arguable case is needed to tip the balance of justice to set the judgment aside. (Moore-Bick J in International Finance Corporation, (2001) CLC 1361).

The real prospect of success means that the prospects must be better than merely arguable. The word "real" directs the court to the need to see whether there is a realistic as opposed to a fanciful prospect of success. It saves expense, achieves expedition, avoids the courts resources being used up in cases where that serves no purpose and is in the interest of justice.

There is no room for speculative defences and potentially credible affidavit evidence must demonstrate a real likelihood that a defendant will succeed. Otherwise no real prospect of success is shown and relief should be refused (Allen v Taylor) [1992] PLQR 255)

The test was considered in detail in Swain v Hilman (2001) (1), All E.R. 91 and the court confirmed that;

"The test is the same as the test for summary judgment. The only significant difference is that in a summary judgment application the burden of proof rests on the claimant to show that the defendant has no real prospect of success whereas in an application to set aside a default judgement it is for the defendant to show that his defence has a real prospect of success.

❖ DELAY

An application to set aside default judgment must be made "promptly" and without "delay".

In "Pankaj Bamolc and Another v Moran Ali" FCA 50/1999, a party seeking to set aside an Order had delayed for nearly 08 months. The Court took the view that no adequate explanation had been provided for that and concluded that the application should be refused because it had not been made promptly and without delay.

Promptness will always be a factor of considerable significance and, if there has been a marked failure to make the application promptly, a court may well be justified in refusing relief, Notwithstanding the possibility that the Defendant may well succeed at the trial.

Whether or not there is a defence on the merits may be, the dominant feature to be considered but that does not mean that it cannot be swamped by other features such as unexplained delay in bringing the application to set aside the judgment.

Although the fact that damages have been assessed and a final judgement entered does not deprive the court of jurisdiction to set aside a default judgment; it is highly relevant to the exercise of discretion. It is an aspect of, but separate from, the question of delay. The Saudi Eagle case (supra) is clear authority for the proposition that an application to set aside a default judgement can be made notwithstanding that final judgment has been entered.

In Alpine Bulk Transport Co. Inc v Saudi Eagle Shipping Co. Inc (The Saudi Eagle) [1986] 2 Lloyd's Rep the defendants, believing that they had no assets, deliberately allowed an interlocutory judgment for damages to be assessed to be entered against them by default, and only after damages had been assessed and final judgment entered, realising that they had given security, applied initially to the judge and then on appeal to the Court of Appeal, unsuccessfully at both hearings, to set aside the judgement and for leave to defend. The application was refused on the merits; but it was not suggested that the judge would not have had jurisdiction to set aside the judgment had it been appropriate to do so. Therefore, it cannot be said that a judgement (by default) for damages to be assessed is spent once damages are assessed; it remains the source of the plaintiff's right to damages. Nor can it be said that in such a case the interlocutory judgment is overtaken or superseded by the final judgment for a liquidated sum; it would be more accurate to say that it is completed and made effective by the assessment.

It cannot be safely assumed in every case that any prejudice to the plaintiff can be met by putting the defendant on terms to pay the costs thrown away by the assessment hearing. There can be no rigid rule either way; it depends on the facts of the particular case.

❖ PROCEDURE

An application to set aside a default judgment which has not been entered wrongly must be supported by evidence. Commonly, a draft defence is attached to the affidavit in support of the application.

A draft defence is not necessary, what is required is the affidavit of merits. (The Fiji Sugar Corporation Ltd. v Mohammed Civil Appeal No. 28/87.)

If the Defendant does not have an affidavit of merits, no setting aside order sought to be granted except for some very sufficient reason. (Wearsmart Textiles Ltd v General Machinery Hire Ltd, (1998) FJCA 26.)

In Wearsmart Textiles Ltd v General Machinery Hire Ltd [1998] FJCA 26; Abu0030u.97s (29 May 1998) the Fiji Court of Appeal cited the following passage from the Supreme Court Practice 1997 (Volume 1) at p.143.

"Regular judgment – if the judgment is regular, then it is an inflexible rule that there must be an affidavit of merits, i.e. an affidavit stating facts showing a defence on the merits (Farden v. Richter [1889] UKLawRpKQB 79; (1889) 23 Q.B.D. 124. "At any rate where such an application is not thus supported, it ought not to be granted except for some very sufficient reason." per Huddleston, B., ibid. p.129, approving Hopton v. Robertson [1884] W.N. 77, reprinted 23 Q.B.D. p. 126 n.; and see Richardson v. Howell (1883) 8 T.L.R. 445; and Watt v Barnett [1878] UKLawRpKQB 21; (1878) 3 Q.B.D. 183, p.363).

(my emphasis)

"it is an (almost) inflexible rule that there must be an affidavit of merit i.e. and affidavit stating facts showing a defence on the merits (FARDEN v RICHTER [1889] UKLawRpKQB 79; (1989) 23 Q.B.D. 124)" The Supreme Court Practice 1993 Or 13 r.9 p.137). "At any rate where such an application is not thus supported, it ought not to be granted except for some very sufficient reason" HUDDLESTON, B in FARDEN ibid p.129).

❖ SETTING ASIDE ON CONDITIONS

In the exercise of Court's discretion, the court may attach conditions to an order to set aside judgment. In some cases the defaulting defendant will be ordered to pay the claimant's costs thrown away. In appropriate cases, the court may also require the defendant to pay money into court to await the final disposal of the claim. Such a condition is commonly imposed where,

1. The defendant has satisfied the court that it has a defence with a real prospect of success.

2. The Defendant has an explanation why he neglected to appear after being served.
3. The truth of which is indeed denied by the Plaintiff.

4. The court seeks no reason why the Defendant should be disbelieved in what appears to be a mere conflict on affidavits.

The conditions imposed on setting aside a default judgment are not intended to punish the defendant but to ensure that justice is achieved between the parties (VIJAY PRASAD v DAYA RAM CIV APP 61/90 FCA; SUBODH KUMAR MISHRA s/o Ramendra Mishra v CAR RENTALS (PACIFIC) LTD CIV APP 35/85 FCA). The said judgments do not lay down any basis upon which the discretion is to be exercised.

In GARDNER v JAY (1885) 29 Ch.D 52 at p.58 BOWEN L.J. said on this aspect that:

"... when a tribunal is invested by Act of Parliament or by Rules with a discretion, without any indication in the Act or Rules of the grounds upon which the discretion is to be exercised, it is a mistake to lay down any rules with a view to indicating the particular grooves in which the discretion should run, for if the Actor the Rules did not fetter the discretion of the Judge why should the Court do so?"

(C) THE FACTUAL BACKGROUND AND ANALYSIS

(1) What are the facts here? It is necessary to approach the case through its pleadings bearing all those legal principles in my mind.

(2) To give the whole picture of the action, I can do no better than set out hereunder, the main averments/assertions of the Statement of Claim.

(3) The Plaintiff in its Statement of Claim pleads inter alia;

(i) The Plaintiff is a body corporate duly constituted under the provisions of the iTaukei Land Trust Act, Cap. 134 to control, manage and administer itaukei land for the benefit of its itaukei owners. (ii) The Defendant is a limited liability company having its registered office at Level 2 Provident Plaza, Ellery Street, Suva. (iii) By Native Lease No. 28769 in writing and dated on or about the 21st day of November, 2008, and made between the Plaintiff of the one part and the Defendant on the other part, the Plaintiff leased to the Defendant for a term of 99 years effective from the 1st day of October, 2006, an area of 8.6545 hectares of itaukei land known as Naseyani (Part of) Sub-Division Lot 1 on SO 5897 in the District of Raviravi in the Province of Ra (hereinafter referred to as "the said land") for Industrial purposes (hereinafter referred to as "the said lease") at an annual rental of $20,000.00 (Twenty Thousand Dollars) (hereinafter referred to as "the said rent"). (iv) The said land is owned by the Mataqali Tawa of Naseyani Village in the District of Raviravi in the Province of Ra. (v) The said lease is subject to the provisions of Regulations 14 of the iTaukei Land Trust (Leases & Licenses) Regulations 1984. (vi) There is implied in the said lease by virtue of above mentioned section a condition and covenant that the rent payable under the lease shall be paid by the Defendant not later than the day or days as specifically required by the said lease. (vii) The Defendants has failed to pay the rent due under the said lease and his rent is in arrears. (viii) By a Notice under the above mentioned section in writing dated the 3rd day of April, 2014 (hereinafter referred to as "the said notice") and served on the Defendant's registered office on the 7th day of April, 2014, 2011, the Plaintiff gave the Defendant one (1) month from the date of receipt of the said notice to pay rent arrears to the said date in the sum of $101,636.49 (One Hundred and One Thousand Six Hundred and Thirty Six Dollars and Forty Nine Cents). (ix) The Defendant was also informed in the said notice that the sum of $172.50 (One Hundred and Seventy Two Dollars and Fifty Cents) will be reflected in the total sum claimed as Arrears Collection Fee. (x) The said notice also provided that if the said arrears were not paid the Defendant's lease would be terminated and that it would be required to quit the said land and give vacant possession of the same to the Plaintiff. (xi) The said notice has expired and the Defendant has not paid the said arrears. (xii) The Plaintiff is also separately pursuing its right of re-entry of the land in question on the grounds of non-development as required under clause 2 (1) of the said lease.

(4) In its Statement of Claim, the Plaintiff seeks the following orders;

(a) An order for vacant possession of the land in question.

(b) Judgment for the sum of $101,808.99 (One Hundred and One Thousand Eight Hundred and Eight Dollars and Ninety Cents).

(c) Costs limited to the jurisdiction of this court.

(d) Any further or other orders that this Honourable Court may deem just and expedient.

(5) The Plaintiff instituted the proceedings herein against the Defendant on 13th May 2014.

According to the Affidavit of Service filed on 04th July 2014 by the Plaintiff, the Writ of Summons was served on the Defendant on 16th June 2014. On 10th February 2015, the Plaintiff, having searched and finding that the Defendant had failed to give Notice of Intention to Defend within the prescribed time, entered judgment against the Defendant. The Default Judgment was sealed on 13th February 2015. The sealed Default Judgment reads as follows;

DEFAULT JUDGMENT NO ACKNOWLEDGEMENT OF SERVICE having been filed by the Defendant in this action. IT IS THIS ADJUDGED: (a) An order that the Defendant vacates the land comprised in Native Lease No. 28769 being iTaukei Land known as "Naseyani (Part of) Sub-Division Lot 1 on SO 5897 comprising 8.6545 Hectares in the District of Raviravi in the Province of Ra. (b) Judgement for Ground Rental Arrears together with Arrears Collection Fees of $172.50 in the total sum of $101,808.99 (One Hundred and One Thousand, Eight Hundred and Eight Dollars and Ninety Nine Cents). (c) Costs of this action. SEALED this 13th day of February, 2015. BY THE COURT (signed) DEPUTY REGISTRAR

(6) In its Affidavit in Support of the Summons, the Defendant's Company Secretary, Mr. Sakiusa Bolaira, deposed that the Default Judgment was irregularly obtained.

Reference is made to paragraph (11) and (19) of the Affidavit in Support;

(11) I have received advice from our solicitors that the Default Judgmentdated 13 February 2015 was irregularly issued since prior to it being filed on 10 February 2015 the Defendant had duly filed its Acknowledgment of Service of the Writ of Summons and Statement of Defence, which was not issued by the High Court Registry. (19) We are advised by our solicitors that the default judgment for vacant possession is procedurally defective since the Plaintiff has not presented any evidence and/or formally proved its case for vacant possession.

(7) Further, Mr Sakiusa Bolaira deposed that the Defendant possesses a perfectly good Defence.

(8) The Counsel for the Defendant in both his oral as well as written submission contended that the Defendant has a prima facie defence and should be allowed to come in and defend the action.

(9) The Plaintiff's Counsel submitted that there is no ground to set aside the Judgment which had been regularly obtained. Further the Counsel argued, the Writ had been properly served on the Defendant, the Affidavit of Service filed and followed by search for Defence, before the Judgment in default of Notice of intention to Defend/Acknowledgement of Service was entered. The Counsel forcefully submits that there is no instance of irregularity at all.

(10) Before I pass to consideration of the arguments, I ought to mention one thing. The Defendant filed an affidavit by its Company Secretary in support of its Summons to set aside the Default Judgment. The Plaintiff chose not to reply. The Plaintiff did not take objection to the Defendant's Affidavit.

Since there is no affidavit in opposition filed by the Plaintiff, I am inclined to accept the evidence of deponent "Sakiusa Bolaira" in toto. In doing so, I am fortified in my view by the Court of Appeal judgment in "Jay Prakash v Savita Chandra" Civil Appeal No: ABU 0037/1985. It was held; "Of course he did have to respond in our view the cause of events have taken and the consequences, if did not respond, rendered it as matter of prudence that he should reply if indeed he had a reply. And in the circumstances of the case in the absence of a reply, we hold the inference inescapable what the respondent had said to be true." (Emphasis Added)

(11) Be that as it may, the real issue and the only issue which this Court has to consider at the outset is whether the default judgment was regularly entered. Thus, where an irregular default judgment is entered (for example time for acknowledging service or for serving a defence had not expired by the time the default judgment was entered) which irregularity cannot be cured the Defendant is entitled as of right to have the judgment set aside.

However, where the default judgment had been entered regularly, the Court has a wide discretion and neither Order 13, rule 10 nor Order 19, rule 9 of the High Court Rules impose any restriction in the manner in which the discretion is to be exercised.

The prescribed time for the filing of Notice of Intention to Defend and the Acknowledgment of service of Writ is stipulated under Order 12, rule 4 as fourteen days. In this instance, the Writ was served on the Defendant on 16th June 2014. The default judgment was obtained on 10th February 2015. Therefore, there was sufficient time to file the Acknowledgment of Service.

Nevertheless, is the default judgment entered in accordance with the High Court Rules, 1988?

The answer to this question is obviously "No."

(12) The Default Judgment reads as follows;

DEFAULT JUDGMENT NO ACKNOWLEDGEMENT OF SERVICE having been filed by the Defendant in this action. "IT IS THIS ADJUDGED: (a) An order that the Defendant vacates the land comprised in Native Lease No. 28769 being iTaukei Land known as "Naseyani (Part of) Sub-Division Lot 1 on SO 5897 comprising 8.6545 Hectares in the District of Raviravi in the Province of Ra. (b) Judgement for Ground Rental Arrears together with Arrears Collection Fees of $172.50 in the total sum of $101,808.99 (One Hundred and One Thousand, Eight Hundred and Eight Dollars and Ninety Nine Cents). (c) Costs of this action. SEALED this 13th day of February, 2015." BY THE COURT (signed) DEPUTY REGISTRAR

What does the Default Judgment represent?

It appears that the Plaintiff has obtained a final Judgment for claim for Possession of land.

The relief (a) sought in the Statement of Claim is a claim falling within Order 13, Rule 4 and Order 19, Rule 5 of the High Court Rules. Put another way, where an order for possession of land is sought and the Defendant fails to give notice of intention to defend, a Judgment can be obtained only under Order 13 Rule 4 of the High Court Rules, 1988. If the Defendant fails to serve a defence on the Plaintiff, a judgment can be obtained only under Order 19, Rule 05 of the High Court Rules.

To be more precise, where an order for possession of land is sought and the Defendant fails to give notice of intention to defend or fails to serve a defence on the Plaintiff, a judgment can be obtained only at a hearing before a judge. Regrettably, in the instant case, the Plaintiff has entered a judgment in default of notice of intention to defend without a hearing before a Judge. If judgment was to be entered, it could be done only upon calling evidence from the Plaintiff. No evidence is taken from the Plaintiff in respect of its claim for possession of land. There could be no judgment in Default without the hearing of evidence. In the absence of hearing evidence, the court has no jurisdiction to enter Default Judgment. Therefore, the entry on the record of judgment in Default does not have a proper foundation. Can it be said that there was "evidence" before the court upon which the judgment for possession of land was based??? I say no more on this!!!

For the sake of completeness Order 13 Rule 4 and Order 19, Rule 05 is reproduced below.

Claim for Possession of Land (Order 13, Rule 4) 4-(1) Where a writ is indorsed with a claim against a defendant for possession of land only, then, subject to paragraph (2), if that defendant fails to give notice of intention to defend the plaintiff may, after the prescribed time, and on producing a certificate by his solicitor, or (if he sues in person) an affidavit stating that he is not claiming any relief in the action of the nature specified in Order 88, rule 1, enter judgment for possession of the land as against that defendant and costs, and proceed with the action against the other defendants, if any. (2) Where there is more than one defendant, judgement entered under this rule shall not be enforced against any defendant unless and until judgment for possession of the land has been entered against all the defendants. Claim for Possession of Land (Order 19, Rule 5) 5-(1) Where the plaintiff's claim against a defendant is for possession of land only, then, if that defendant fails to serve a defence on the plaintiff, the plaintiff may after the expiration of the period fixed by or under these Rules for service of the defence, and on producing a certificate by his barrister and solicitor, or (if he sues in person) an affidavit, stating that he is not claiming any relief in the action of the nature specified in Order 88 rule 1, enter judgement for possession of the land as against that defendant and for costs, and proceed with the action against the other defendants, if any. (2) Where there is more than one defendant, judgement entered under this rule shall not be enforced against any defendant unless and until judgment for possession of the land has been entered against all the defendants.

If there are irregularities in the Default judgment but they are de minimis or merely clerical errors, the court will not set the judgment aside. Rather, it will correct the errors. The court will not make the Plaintiff start again.

But in this case, the Default Judgment has been entered irregularly and not in compliance with the High Court Rules.

Therefore, it is clear beyond question that the irregularities were more than de minimis and were not clerical errors. It will be ridiculous for me to penalise the Defendant for the irregularities which are more than de minimis and not just clerical errors. I cannot simply uphold the Default Judgment. My function is to decide whether or not to grant the Defendant's application to set aside the Default Judgment.

The Court of Appeal in White v Western [1968] 2 Q.B. 647 held:

"That where there is an irregularity in the entry of default judgment the party against whom judgment is obtained is entitled to have the judgment set aside and the court should impose no terms whatever on him, not even contingent term such as that the costs should be costs in the cause."

Given the above, I certainly agree with the sentiments which are expressed inferentially in the Defendant's submission.

The rules are there to be obeyed. In the context of the present case, I am mindful of the rule of law enunciated in the following decisions;

In Ventakamma v Ferrier Watson CIV. APP. CBV0002/92 – Judgement delivered 24th November 1995) said:-

"We now stress, however, that the rules are there to be obeyed. In future Practitioners must understand that they are on notice that non-compliance may well be fatal to an appeal."

In Ratnam vs Cumarasamy and Another: [1964] 3 All E.R. at page 935;

Lord Guest in giving the opinion of the Board to the Head of Malaysia said, inter alia:

"The rules of court must, prima facie, be obeyed, and, in order to justify a court in extending the time during which some step in procedure requires to be taken, there must be some material on which the court can exercise its discretion. If the law were otherwise, a party in breach would have an unqualified right to an extension of time which would defeat the purpose of the rules which is to provide a time table for the conduct of litigation. The only material before the Court of Appeal was the affidavit of the appellant. The grounds there stated were that he did not instruct his solicitor until a day before the record of appeal was due to be lodged, and that his reason for this delay was that he hoped for a compromise. Their lordships are satisfied that the Court of Appeal were entitled to take the view that this did not constitute material on which they could exercise their discretion in favour of the appellant. In these circumstance, their Lordships find it impossible to say that the discretion of the Court of Appeal was exercised on any wrong principle."

Therefore, there is no need for me to express any view on the strength of the Defence, since this matter can go no further.

(D) Conclusion

Having found that the judgment was irregularly obtained and in view of the authorities to which I have referred, there is no alternate but to set aside the Default Judgment entered on 10th February 2015.

(E) Final Orders

(1) The default judgment entered against the Defendant dated 13th February 2015 is set aside.

(2) The defendant is at liberty to defend the claim unconditionally.

(3) The defendant is ordered to file its Acknowledgement of Service and Statement of Defence within 07 days and 14 days respectively from the date hereof.

(4) I make no Order for costs.

.......................................
Jude Nanayakkara
Acting Master of the High Court

At Lautoka
28th August 2015