Merchant Finance & Investment Company Ltd v Shah [2015] FJHC 798; HBC101.2014 (23 October 2015)

IN THE HIGH COURT OF FIJI
WESTERN DIVISION
AT LAUTOKA

CIVIL JURISDICTION

CIVIL ACTION NO. HBC 101 of 2014

BETWEEN:

MERCHANT FINANCE & INVESTMENT COMPANY LIMITED a limited liability company having its registered office at Level 1 Ra Marama House, Gordon Street in Suva.
PLAINTIFF

AND:

HAROON ALI SHAH of 7 Yasawa Street, Lautoka in Fiji
DEFENDANT

Mr. Armish Amendra Pal for the Plaintiff.
No appearance for or on behalf of the Defendant.

Date of Hearing: - 20th August 2015
Date of Ruling : - 23rd October 2015

RULING

(A) INTRODUCTION
(1) The matter before me stems from the Plaintiff's Summons dated 30th April 2015, made pursuant to Order 59, rule (2) and (4) of the High Court Rules 1988 and the inherent jurisdiction of the Court seeking the grant of the following Orders;

1. That this within action be reinstated;

2. The Plaintiff comply with Orders made pursuant to the Summons for Directions within 21 days of these Orders being made;

3. That the cost of this application be costs in cause;

4. Any other Orders that this Court deems just, fair and necessary.

(2) The Summons was first called on 20th May 2015. The Summons is strongly resisted by the Defendant.

(3) The Defendant filed an Affidavit in Opposition opposing the Summons followed by an Affidavit in reply thereto.

(4) The Plaintiff was heard on the Summons. Neither the Defendant nor the Counsel appeared in Court on the hearing date.

(B) BACKGROUND

(1) The Plaintiff is a financial institution registered pursuant to the Banking Act of Fiji and is engaged in the Business of providing loans to its customers.

(2) On the 21st June 2012, the Defendant entered into a loan Contract with the Plaintiff in the sum of FJD 300,000.00.

(3) The Plaintiff alleges that the Defendant defaulted in his repayments and this breached the said loan agreement.

(4) Wherefore, the Plaintiff prays for the following Orders;

• ❖ Judgment against the Defendant in the sum of FJD $306, 360.58
• ❖ Pre-Judgment interest.
• ❖ Post-Judgment interest.
• ❖ Costs on a Solicitor – Client indemnity basis.
  

(C) THE STATUS OF THE SUBSTANTIVE MATTER

(1) The Plaintiff instituted the proceedings against the Defendant on 26.07.2014.

(2) The Pleadings in the action begun by the Writ are closed.

(3) On 26th September 2014, the Plaintiff filed Summons for Directions.

(4) The Summons for Directions was heard on 07th November 2014. There was no appearance for or on behalf of the Defendant on 07th November 2014. The Plaintiff obtained Orders in terms of Summons for Directions and the matter was listed for mention on 01st December 2014 directing the Plaintiff to:

• ❖ Seal and serve the Order for Summons for Directions
  

AND

❖ To file and serve the Plaintiff's List of Documents.

(5) On 01st of December 2014, although the Order for Summons for Directions was not sealed and served as directed on the last occasion, the Court granted further time to the Plaintiff to seal and serve the Order on or before 19th January 2015.

(6) On 19th January 2015, the Plaintiff moved for further time to seal and serve the Order

on Summons for Directions. The Court granted final 07 days to the Plaintiff to seal and serve the Order on or before 02nd February 2015.

(7) On 02nd February 2015, the Plaintiff moved further time to seal and serve the Order. The Court granted further 07 days for the Plaintiff to seal and serve the Order on or before 09th February 2015. Moreover, the Court made an unless Order requiring the Plaintiff to seal and serve the Order on Summons for Directions by 09th February and specified the consequences of the default. Clearly, the unless Order was made by Court in exercising its inherent jurisdiction. The Court made the unless Order since the Plaintiff is breaching the Court Order made "relating to procedural compliance" either intentionally or contumaciously or acting lethargically.

(8) On 12th February 2015, there was no appearance for or on behalf of the Plaintiff. The Court struck out the action on the basis that the Plaintiff failed to seal and serve the Order on Summons for Directions as directed in the unless Order dated 02nd February 2015.

(9) I note without comment that almost 2 ½ months have elapsed since the action was struck out. Nearly 2 ½ months later, the Plaintiff filed Summons to reinstate the action.

(D) THE PLAINTIFF'S SUMMONS FOR REINSTATEMENT

(1) The Plaintiff's Summons is supported by an Affidavit sworn by "Michael Arun", the Legal Clerk in the employment of Messrs AP Legal, the Solicitors for the Plaintiff, which is substantially as follows (so far as relevant):

Para 5. Ms Tavakuru of Messrs Vijay Naidu & Associates appeared on our instructions on the 7th of November and there was no appearance by the Counsel for the Defendant. Ms Tavakuru obtained Orders in terms of the Summons for Directions and the matter was then listed for mention on 1st December 2014. The report from our agent advising the above is annexed and attached as "A".

6. On 1st December 2014 our agents appeared again on our instructions and sought 14 days to allow the Plaintiff to have its List of Documents filed and served on the Defendant. The Master then scheduled the matter to be called for mention on 19th January 2015 allowing the Plaintiff to:

(a) Seal and serve the Order for Summons for Directions; and

(b) To file and serve the Plaintiff's List of Documents.

The Counsel for the Defendant was also not present on this occasion. The report from our agent advising the above is annexed and attached as "B".

7. When the matter was called on 19th January 2015 the Master allowed the Plaintiff 7 days to seal and serve the Order for Summons for Discretions. The matter was then adjourned to the 2nd of February 2015. The report from our agent advising the above is annexed and attached as "C".

8. On 2nd February 2015, although the Order for Summons for Directions was not sealed and served as directed on the last occasion the Master allowed final 7 days to the Plaintiff to seal and serve the Order on or before the 9th of February 2015 when the matter was scheduled for mention. The report from our agent and advising the above is annexed and attached as "D".

9. On 9th February 2015 our Principal, Mr Amish Pal personally attended to have the Order filed for sealing at the Lautoka High Court registry. He was able to personally attend to the filing of the Order since he was in Lautoka for a hearing in the matter of Anthony Richmond Elliot v Fiji Development Bank & Ors Lautoka High Court Civil Action No 190 of 2014.

10. Our agents then attended to file the Plaintiff's List of Documents on 26th February 2015 however they were advised by the Clerk at the registry that the matter was struck out on 12th February 2015 on the basis that the order was not sealed within the final 7 days granted by the Master.

11. The matter should not have been struck out on the basis that the Order was not filed on time as directed by the Master since our Principal had personally attended to file the Order on the 9th of February 2015.

12. The action appears to have been struck out as a result of the registry's failure to insert the Order in the court file and also to notify the Master that the Order was filed on time. The Plaintiff should not be unduly punished for the administrative shortcomings of the registry.

13. I believe that the Defendant will not be prejudiced by this application as we have been consistently attending to the matter and from the Defendant's lack of appearance on a few occasions they seem to have no interest in the matter. The Plaintiff has a legitimate claim with a great prospect of success and it will be prejudicial to the Plaintiff if this matter is not reinstated.

(2) The Defendant filed an Affidavit in Opposition which is substantially as follows: (so far as relevant)

Page 2. THAT I oppose the Plaintiff's application and ask that the application to restore be dismissed forthwith as the whole action now stands dismissed. The only recourse was for Plaintiff to appeal the Master's Order.

3. THAT additionally there are other valid reasons to dismiss the said application with costs and I recite but a few.

(a) The application should be summarily dismissed as the Plaintiff's Affidavit is based on hearsay from one Armish Pal. The deponent did not attend to the alleged filing. Moreover, there is no attachment of a copy of the alleged sealed Order thereby rendering the deponent's Affidavit weak and not plausible.

(b) The Plaintiff's Affidavit is doubly weak as it does not explain absence of representation by or for the plaintiff on the 12th day of February, 2015. There is nothing from the Plaintiff which would have alerted the Master to the truth of the Plaintiff's present claim.

(c) Critically; whenever there is presented a document or documents for filing at the Counter of the High Court Registry, the clerks; and I say this from my previous personal experience, firstly must retrieve the Court file in question and scrutinize the following:

• (i) The last Order (s) of the Judge/Master/Deputy Registrar.
• (ii) Check the time line to ensure that documents are within the stated prescribed time frame.
• (iii) Check the last entry on the Court file jacket.
• (iv) Check the correctness of the documents; refer to Deputy Registrar if necessary and obtain approval by indorsement from DR.
• (v) Check the prescribed fees and payment method.
• (vi) After approval of DR (if necessary) submit to Cashier for issuance of receipt.
• (vii) Indorse on the Original document the receipt number and date paid.
• (viii) Issue documents if in Order and pin original in Court file.
• (ix) Enter on Court Jacket nature of documents accepted and date filed.
• (x) Enter in the Master Register the nature of the document filed and date.
• (xi) Release to Law Clerk presenting documents copies together with original receipt or place the same in the outward dip for Law firms.
  

(3) The Plaintiff filed an Affidavit in Rebuttal deposing inter alia (so far as relevant):

Para 3. I disagree with paragraph 3 (a) and c (i)-(xi) and wish to state that I will not address the issue of law however, since my Principal is also in carriage he cannot depose the Affidavit. I do not have reasons to doubt his version of events. As indicated, order was lodged for vetting on the 9th February 2015 and they were not returned on the same day.

4. In response to paragraph 3 (b) of the Affidavit, our office was incorrectly updated on the Court appearance. Our agents had informed us that the matter was to be called on the 9th of February 2015. Annexed herewith is the email from our agent dated 3rd February 2015 and marked as "A".

6. In response to paragraph 5 of the said Affidavit, I wish to state that the basis of this application is for reinstatement of the proceeding on the ground that there was an attempt to file the Order and it was not an act of non-compliance. The Plaintiff was put in quandary due to non-appearance and on 12th February 2015 due to incorrect feedback from the agents. Had this not have happened we would have explained the matters to the Court at the time.

7. Likewise, in response to paragraph 5 of the said Affidavit, I further state that the Defendant is attempting to avoid legitimate claims of the Plaintiff and this will be unfair and unjust on the Plaintiff and the Defendant's counsel had not attended court regularly once pleadings have been completed and is basically trying to avoid legitimate claims of the Plaintiff which is prejudicial on the Plaintiff. The Plaintiff's claim is legitimate as a creditor and no viable defence had been presented. Furthermore, the documents filed by the Plaintiff demonstrates that the Plaintiff was genuine and sincere about the claim and was proceeding with the same by filing its list of documents after the Plaintiff's claim was struck out.

(E) ANALYSIS

(1) Before I pass to consideration of the arguments, I ought to mention that there are two problems that concern me. First, the Plaintiff filed an affidavit in support of its summons through a litigation clerk from its solicitor's firm.

I must stress here that the Plaintiff's Summons for an Order re-instating the action is a contested hearing and therefore it is not appropriate for a litigation clerk to depose on behalf of the Plaintiff. To make matters worse, the affidavit contains material which is irrelevant and pure hearsay.

In this regard, I cannot help but recall the sentiments expressed in the following judicial decision.

In "Rupeni Silimuana Momoivalu v Telecom Fiji Ltd", Civil Action No:- HBC 527 of 1997, the court held;

"The habit of supporting or opposing applications to decide the rights of parties based on the information and belief of law clerks is an embarrassment to the clerk, her firm and the court file. Justice Madraiwiwi (as he then was) had this say about the practice of using law clerks in this way:

"It is being made to clear to counsel that affidavits by law clerks were not being entertained other than in non contentious matters such as service of documents where not disputed. The most appropriate person to have sworn the affidavit in these proceedings was Mr.Joji Boseiwaqa who appeared on instructions from the plaintiff at the relevant time. The court respectfully endorses the general thrust of dicta by Lyons J in Michael Harvey v Michael Kelly & Ray McGill, Civil Action No. HBC 323 of 1977 about the propriety of law clerks deposing affidavits".
(Emphasis Added)

It is worth remarking that the Defendant offered response to this Affidavit by the law clerk.

No argument was addressed to me by the Counsel for the Defendant on the admissibility of the affidavit of the law clerk. The Defendant did not make any reference to the admissibility of the affidavit of the law clerk in his affidavit in opposition. I must confess that the affidavit of the law clerk is an embarrassment to the clerk, his firm and the court file.

I am at a substantial loss to understand why the Defendant chose to offer response to the affidavit of the law clerk.

In the absence of any objection being taken by the Counsel for the Defendant on the issue of admissibility of the affidavit of the law clerk, I can do little about it. Consequently, I leave open the issue on the admissibility of the affidavit in support of Summons.

(2) Secondly, the Plaintiff filed its application for reinstatement under Order 59, rule (2) and (4) of the High Court Rules 1988.

I desire to emphasize that the application should have been made under Order 32, rule (6).

I should quote Order 32, rule (6) which provides;

Order made ex parte may be set aside (O.32, r.6)

6. "The Court may set aside an Orde made ex parte."

It seems to me clear beyond question that Order 59, rule (2) and (4) of the High Court Rules have no application even by any stretch of imagination to the instant case.

Order 59, rule (2) relates to the jurisdiction of the Master.
Order 59, rule (4) relates to reference of matter to a Judge.

The instant case stands on an entirely different footing. I have heard no word said on behalf of the Defendant in relation to the irregularity of the Plaintiff's Summons for reinstatement. Nevertheless, this Court is of the view that the Court is bound to look into the "regularity" of the Summons for reinstatement.

On the other hand, the Plaintiff has not sought an Order setting aside the Order that terminated the action. It is an elementary principal of law in any civilized legal system that in order to have an action reinstated, it is first necessary to obtain an Order setting aside the Order that terminated the action in the first place. It is clear beyond question that the Plaintiff can only have its claim reinstated if it is successful in its application to have the Order terminated the action set aside. Having said that I wish to emphasize that in the instant case there is no application to set aside the Order that terminated the action.

For the reasons which I have endeavored to explain, I have no hesitation in reaching the conclusion that the Plaintiff's Summons is defective. In applications such as this, the technicalities are strictly construed because of the drastic consequences that follow for one of the parties upon the relief sought being granted. At this point I cannot resist in saying that it behoved the Plaintiff and it's Counsel to have exercised more diligence in this regard.

In the Court's view, the mistake is fundamental, which cannot be rectified simply by the use of the Court's discretion.

In the context of the present case, I cannot help but recall the rule of law enunciated in the following judicial decisions.

In "Ventakamma v Ferrier – Watson" (CIV. APP. CBV0002/92), (Judgment delivered on 24th November, 1995) the Court held;

"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."

(Emphasis added)

In the decision of the Privy Council 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 circumstances, their lordships find it impossible to say that the discretion of the Court of appeal was exercised on any wrong principle."
(Emphasis Added)

On the strength of the authority in the above judicial decisions, I wish to emphasize that the rules are there to be followed and non-compliance with those rules is fatal.

Having said that, I venture to say beyond a per-adventure that the application in respect of reinstatement must fail for non-compliance with the rules.

In the result, I am constrained to hold that the Plaintiff's Summons can go no further.

Accordingly, there is no alternate but to dismiss the Summons.

I cannot see any other just way to finish the matter than to follow the law.

(3) In view of the approach I have adopted, I do not consider it necessary for me to express my views on the merits of the application for reinstatement.

(F) FINAL ORDERS

(1) The Plaintiff's Summons dated 30th April 2015 is dismissed.

(2) I make no Order as to costs.

Jude Nanayakkara
Acting Master of the High Court

At Lautoka
23rd October 2015