Ritz Investment (Fiji) Ltd, In re [2018] FJHC 396; HBE29.2016 (14 May 2018)

IN THE HIGH COURT OF FIJI
AT SUVA

Winding Up Action No. HBE 29 of 2016

IN THE MATTER of RITZ INVESTMENT (FIJI) LIMITED a limited liability company having its registered office at 77 Vanua Arcade, Level 2, Victoria Parade, Suva.

A N D

IN THE MATTER of the Companies Act 1983, Section 221

BEFORE : Master Vishwa Datt Sharma

COUNSELS : Mr. Emmanuel Narayan : for the Petitioner

: Ms. L. Bali : for the Respondent Company.

Date of Ruling : 14^th May, 2018

RULING

[Summons to Re-instate the Winding up Application struck out on non-appearance on 9^th March, 2018 to the cause list pursuant to Order 32 Rule 6 of the High Court Rules,1988 and the Inherent Jurisdiction of the High Court]

APPLICATION

1. This is the Summons filed by the Applicant Company, Ritz Investment (Fiji) Limited seeking the following orders-
   
   • (a) That this action which was struck off the cause list on the 09^th days of March, 2017 be Re-instated to the cause list upon the grounds set for the in the Affidavit of Vicky Chand.
     
2. The Summons is supported by the Affidavit deposed by Vicky Chand in his capacity as the Director of the Company.
   
3. The application is made pursuant to Order 32 Rule 6 of the High Court Rules, 1988 and the Inherent Jurisdiction of this Honourable court.
   
4. The Applicant’s application was strongly opposed by the Respondent and filed an Affidavit in Opposition.
   

AFFIDAVITS FILED:

(i) Affidavit in Support deposed by Vicky Chand on 29^th March, 2017;
(ii) Affidavit in Opposition deposed by Sang Chan Lee on 09^th May, 2017; and
(iii) Affidavit in Reply deposed by Vicky Chand on 05^th June, 2017.

THE LAW

5. Order 32 Rule 6 of the High Court Rules, 1988 deals with the setting aside of an order made Ex-Parte and stipulates as follows-
   

6. The Court may set aside an order made ex parte.

ANALYSIS AND DETERMINATION

6. The Applicant filed and commenced the Winding Up action against Ritz Investment (Fiji) Limited on 28^th March, 2016.
   
7. The Winding Up Rules 16(2)(b) was complied with by the applicant and accordingly issued with the Rule 19(1) certification on 12^th January, 2017.
8. The Affidavit in Opposition was filed by the Respondent Company on 19th January, 2017.
9. Affidavit in Reply to the Affidavit in Opposition was filed by the Applicant on 26^th January, 2017.
10. The matter was then listed before court [Master] on 16^th February, 2017.
11. Both Counsels representing the parties to this Winding Up proceedings confirmed to court that the matter was being settled and the court therefore adjourned the matter to 09^th March, 2017.
12. There was no appearance by the Applicant/Counsel on 09^th March, 2017. The Respondent Counsel made an application that the matter ought to be struck out. The court whilst acceding to the application, had no alternative but proceed to strike out the Winding Up Application on the non-appearance of the Applicant/Counsel.
13. Subsequently, on 29^th March, 2017, the Applicant filed a Summons seeking an order to have the matter re-instated to the cause list and explained the grounds as follows-
    • (i) That the Counsel for the Applicant made an error relating to the diary entry when not entering the next mention date of the within action and as a result , the Applicant’s Solicitors failed to appear on the 09^th March, 2017;
    • (ii) This matter was only highlighted when counsel in carriage of this matter went through the file on 20^th March, 2017 along with the court attendance sheet for the court appearance on 16^th February, 2017;
    • (iii) That the action was at an advance stage and ready to be fixed for hearing and the Applicant complied with the provisions of the Rule 19 of the Companies (Winding Up) Rules, 2015 in that the Statutory Affidavit has been filed and served, the written consent of the Liquidator has been filed and the Application has been advertised in the local Newspaper and Gazette.
    • (iv) That there has been definite and irreparable harm caused to the Applicant by striking out the matter as they have not been given a proper opportunity to a fair hearing on the merits of the case and as such has been denied natural justice or procedural hearing.
    • (v) That the Applicant will be greatly prejudiced if their Application is not heard and determined by this Honourable Court.
14. On the other hand, I have taken note of the Respondent’s Affidavit in Opposition filed on the 30^th May, 2017 wherein Sang Chan Lee in her capacity as the Company Director stated-
    
    • (i) That the Applicant did not respond to the letter annexed at “D’ written by Shelving Singh Lawyers disputing as to the amount owing totalling to $30,000;
    • (ii) The Applicant failed to confirm a date to meet and discuss the issue of settlement and inconsistent amount owed to the Applicant;
      
15. In Reply, the Applicant submitted that the matter was struck out due to non-appearance of the Applicant/Counsel and not because parties were unable to meet to finalise settlement.
    
16. After a careful perusal of both parties Affidavit in Support and Affidavit in Opposition respectively, this court wishes to bring to the attention of the parties to this proceedings the following-
    
    • (a) This is a Winding Up Application seeking an order to wind up Ritz Investment (Fiji) Limited;
    • (b) On the grounds that the Respondent Company is alleged to be owing a Debt;
    • (c) That the parties had the desire to settle the matter but there was a Dispute as to “Quantum” of Debt owed to the Applicant [Letter from Shelvin Singh Lawyers dated 14^th February, 2017 to Patel Sharma Lawyers and Letter from Patel Sharma Lawyers dated 07^th February, 2017 also refers and annexed in the Affidavit in Opposition at ‘C’ refers.]
    • (d) That Applicant’s Winding Up application was struck out on non-appearance of the counsel. Therefore the striking out order made by the Court was not in itself a final order of the court.
17. The arguments raised by both parties to this proceeding clearly show that there is a Dispute as to the Debt owed in terms of the Quantum.
18. A party to a Winding Up proceedings will only tend to seek settlement [as in this case as per the Master’s minutes of 16^th February, 2017, if the Respondent Company is well aware that a Debt is owed] but may tend to dispute the total Debt owed as claimed by the Applicant.
19. However, the current matter was struck out by the court on 09^th March, 2017 on non-appearance by the Applicant/Counsel and not heard and determined on the merits of this case. I also note the fact that the matter was adjourned from 16^th February, 2017 to 09^th March, 2017 for mention on a joint application of both Counsels wherein the court was informed that the parties were settling the matter. The matter was therefore for mention and not hearing and in any event the matter should not have been struck out rather dealt otherwise appropriate in the circumstances.
20. Further, the Respondent Company, Ritz Investment (Fiji) Limited seems to be disputing the total debt owed but still had the desire to discuss and settle the matter upon a meeting.

IN CONCLUSION

21. I accept the explanation furnished to court for the non-appearance of the Applicant/Counsel resulting in the matter being struck out on 09^th March, 2017.
22. I find that there are triable issues in terms of the total Debt owed by the Respondent Company and it is only appropriate in these circumstances that I accede to the Applicant’s application seeking an order to Re-Instate the Winding Up Application struck out on 09^th March, 2017 to the cause list and allow the Respondent Company to defend the action as he wishes to do so in the circumstances.
23. The Applicant’s Summons seeking the Re-Instatement of the Winding Up Action to the cause list succeeds and is accordingly granted.
24. In terms of the Costs issue: Obviously the Respondent Company Ritz Investment (Fiji) Limited is entitled to a reasonable cost in the circumstances summarily assessed at $500 to be paid within 21 days timeframe.
25. Section 528 of the Companies Act 3 of 2015 requires an action for a Company to be wound up in Insolvency, to be determined within 6 months after it is made. The current action was initiated on 28^th November, 2016. The 6 months’ time frame would have expired on 28^th May, 2017. The Applicant’s Summons seeking an order for Reinstatement was filed on 29^th March, 2017, before the expiration of 6 the month’s timeframe. Therefore, it became necessary for court to determine the Applicant’s Summons first before proceeding any further with the Substantive Winding up Application.
26. Therefore, in terms of Section 528 (2) (a) of the Companies Act 3 of 2015, this Court is justified that special circumstances did exist as hereinabove and therefore it justified the extension to hear and determine the substantive Winding Up Application at its earliest without any further delay.
27. Accordingly, I grant an extension in terms of Section 528 (2) (a) of the Companies Act 03 of 2015.

FINAL ORDERS

1. The Applicant’s Summons for Reinstatement of the Winding Up Application to the cause list succeeds;
2. The Winding Up Application is accordingly Reinstated to the cause list.

100. Time is also extended beyond the 6 months’ time frame to hear and determine the substantive Winding Up Application at its earliest.

4. Costs is summarily assessed at $500 against the Applicant and to be paid within 21 days to the Respondent.
5. Matter stands adjourned for further directions and scheduling of a hearing date on 14^th May, 2018 @ 9 am.
6. Orders accordingly.
   

DATED AT SUVA THIS 14^TH DAY OF MAY 2018

................................................

Master

VISHWA DATT SHARMA

cc: Patel Sharma Lawyers, Suva.
Shelvin Singh Lawyers, Suva.