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High Court of Fiji |
IN THE HIGH COURT OF FIJI
IN THE WESTERN DIVISION
AT LAUTOKA
CIVIL APPELLATE JURISDICTION
Civil Appeal No.: HBA 17 of 2018
BETWEEN
NALESH NAND of Kings Road, Yalalevu, Ba, Quantity Surveyor
APPELLANT
A N D
FIJI DEVELOPMENT BANK a corporate body having its head office at 360 Victoria Parade, Suva, Fiji.
RESPONDENT
Appearances : The appellant in person
(Ms.) Akosita Raitivi for the respondent
Hearing : Friday, 01st May, 2020.
Judgment : Friday, 29th May, 2020.
J U D G M E N T
[01] This is the judgment in an appeal from the decision of the Magistrate Court at Ba. In his worship’s ruling of 12.09.2019, the Magistrate dismissed the appellant’s application in which the appellant had sought to set aside judgment entered by default in civil suit no- 65 of 2016. In this civil suit, the respondent had sued the appellant by Writ of Summons for recovery of $ 10,602.42, the unpaid debt under the Bill of Sale and the Loan agreement made between the respondent bank and the appellant.
[02] The respondent filed a Writ of Summons against the appellant in the Magistrate Court on 02nd September, 2016 claiming a sum of $10,602.42 together with post judgment interest at the rate of 5% but limited to $50,000.00.
[03] The appellant filed his Statement of Defence on 25th October, 2016 and the respondent filed its Reply to Defence on 24th February, 2017.
[04] On 22th November, 2017 a NOAH was issued on both parties to be present in court on 24th November 2017 for mention to fix a hearing date. The appellant did not appear and the respondent appeared on 24th November, 2017.
[05] On the 24th November, 2017 the case was set for hearing on 05th June, 2018.
[06] On the day of the hearing, i.e. 05-06-2018 the appellant was not present but the respondent was present in court together with its witness and were ready to proceed with the hearing. The Statement of Defence was struck out and the respondent’s suit was heard ex parte. The respondent called (Ms.) Margaret Hazelman, a representative of the bank working in the Asset Management Unit, based in Suva.
[07] The court considered the evidence of (Ms.) Hazelman and their being no Statement of Defence on foot, the Court entered judgment in favor of the respondent. The ex parte judgment was delivered on 08.06.2018. The appellant was ordered to pay $10,602.42 together with the post judgment interest of 4%.
[08] On 21st June, 2019 the appellant filed a Notice of Motion in the Magistrate Court of Ba seeking the following relief;
“That the judgment entered by default in favour of the plaintiff as per the content of judgment made in the Magistrate Court Ba with confused dates be set aside”.
(Emphasis added)
[09] I note with concern that the application to set aside the default judgment had been made pursuant to the inherent jurisdiction of the Court.
[10] The appellant’s application was heard by the Magistrate on 16-07-2019. After considering the principles of setting aside default judgments, the Magistrate dismissed the application on 12-09-2019. The Magistrate held that the appellant does not meet the threshold for the setting aside of default judgment.
[11] Being aggrieved by the decision of the learned Magistrate, the appellant appealed against the decision to the High Court.
[12] There are nine (9) grounds of appeal set out in the Notice of Appeal filed on 01-10-2019. They are not drafted in a way which suggests with perfect clearness the grounds upon which relief was being asked. The grounds of appeal are;
(1) THAT the honourable Magistrate did not consider all the relevant evidence provided in my Statement of Defense filed on 25th October, 2016 and in my Submission to set aside Ex-Parte Judgment on hearing day on 16th August, 2019. This is straight forward case, this does not need an open court hearing or trial proper. The Defendant has a valid defense in this matter.
(2) THAT the hearing at Magistrate Court Ba on 8th June, 2018 as per content in the judgment without my presence as well as date not matching with date issued to me. Usually in Magistrate Court dates are written in a piece of paper and issued.
The Ruling at Magistrate Court Ba on 5th June, 2018 as per content in the Judgment with my absence besides something very serious to note.
(3) THAT the claim made in the Judgment read as follows: Plaintiff filed a Writ of Summons on 2nd September, 2009 seeking to recover the loan.
Once again its wrongdoing and a very serious matter as there was no loan on 2nd September, 2009.
(4) THAT I do not agree with the Final Order made in the Judgment on 5th June, 2018 at Magistrate Court, Ba. As per offer letter in Facility Schedule Agricultural and Development Page more than Twenty Five Thousand Seven Hundred Fifteen Dollars was paid to Plaintiff (Ba Branch) as at 30th November, 2013 and the securities were not discharged.
In any bank statement there is a Debit Column, a Credit Column and a Balance Column, so Debit Column indicates interest charged Credit Column indicates the amount I have paid and its total amounting to $25,715.00.
According to Loan offer letter dated 11th December, 2009 and as per Facility Schedule Agriculture and Development Page I have already paid my loan and paid interest up to one hundred fifty percent.
Therefore, I do not agree with the claims made by the Plaintiff.
(5) THAT an expression of dissatisfaction in terms of loan offer letter dated 11th December, 2009 addressed to me whereby in the Facility Schedule Agriculture and Development Page does not reconcile in accordance with account made in operation.
The initial stage of operation has created dissatisfaction and it is question of doubt as I have raised concern in the above matter. It was some kind of money making technique. It appears that there has been overcharged payments and interest subject to the said offer letter by the Plaintiff. It’s total confusion.
As the Plaintiff has breached loan offer letter agreement and the Defendant in this matter is suffering the greater injustice.
(6) THAT my consistent repayment on 31st July, 2013 and it to do appear on Bank Statement as well as a receipt being issued on the same day and to my surprise arrears fees is charged. It’s breach of Loan Offer Agreement, its wrong doing and dishonesty. It’s vague.
Plaintiff is not consistent with repayments record as well as to any accounting accuracy with opening balance for new month and closing balance for month end and in this subject issue it becomes total confusion to reconcile bank statement and analyse monthly records.
(7) THAT the Defendant requested for discounted debt settlement figure on 25th May, 2012 and a reply through a letter on 8th June, 2012, the Plaintiff declined the request and advise the Defendant to continue normal repayments.
In this matter Plaintiff (Bank) approach to help Defendant was not good as they never helped me in any of the natural disasters compared to other customers. It is to be noted Plaintiff is a Financial Institute and their purpose is to serve people.
This clearly indicates that the Plaintiff had some personal agenda towards the Defendant. It was a money making technique by Plaintiff towards Defendant.
(8) THAT the Plaintiff in this matter on 2nd September, 2016 filed Writ of Summons. As per paragraph 1 of the Writ of Summons it reads as follows:
The Plaintiff is a body corporate established under section 3 of the Fiji Development Bank Act Chapter 214 (“the act”) with perpetual succession and a common seal and is capable of suing and being sued.
The Defendant in this matter on 25th October, 2016 filed Statement of Defense as my paragraph 1 read as follows:
Absolutely yes and we can get compensated for this dissatisfaction service.
(9) THAT the Loan Agreement was breached by the Plaintiff and there was delay of time from Plaintiff to solve this subject issue since 23rd June, 2014 and taking this matter to Magistrate Court, B a filed on 2nd September, 2016.
[13] The respondent’s suit was heard ex-parte. The appellant’s notice of motion filed before the learned Magistrate of Ba dated 21-06-2019 is irregular as the application has been made to:
“That the judgment entered by default in favour of the plaintiff as per the content of judgment made in the Magistrate Court of Ba with confused dates be set aside”.
[Emphasis added]
[14] The first issue that the court must deal with is whether there was proper application before the Magistrate? I find that there was no proper application before the Magistrate. The appellant cannot file an application to set aside default judgment but an application to set aside ex-parte judgment because the respondent’s suit was heard ex-parte. There is a world of difference between a default judgment and an ex-parte judgment. A default judgment can be obtained as a matter of course following the defendant’s failure to give notice of intention to defend or default of defence. The ex-parte judgments are essentially provisional in nature and they are made by the Judge or Magistrate on the basis of evidence and submissions emanating from one side.
[15] The appellant’s application for setting aside is concerned with the judgment written and delivered by the Magistrate dated 08-06-2018 on the basis of evidence and submissions emanating from the respondent’s side (the original plaintiff) only there being no appearance by the appellant (the original defendant). It is an ex-parte judgment after the formal proof hearing held before the court on 05-06-2018.
[16] The procedure adopted was not the right procedure to set aside the judgment dated 08.06.2018. The appellant should have come under order xxx, Rule 5 of the Magistrate’s Court Rules to rescind the ex-parte judgment. For the sake of completeness Order xxx, Rule 5 is reproduced below in full.
“Any judgment obtained against any party in the absence of such party may on sufficient cause shown, be set aside by the court, upon such terms as may seem fit”.
[Emphasis added]
[17] The procedure is important, since the Magistrate Court has no inherent jurisdiction to set aside its own orders. In accordance with Section 5 of the Administration of Justice Act of 2009, the upper courts such as High Court, Court of Appeal and Supreme Court have inherent jurisdiction. Section 5 of the Administration of Justice Act says;
“5.(1) Each of the High Court, the Court of Appeal and the Supreme Court has the jurisdiction, including the inherent jurisdiction, conferred on it by this
Decree or by any other law.
No court shall be vested with jurisdiction same as is or may be conferred on it by this Decree or any other law”.
Lord Sumpton stated in Barton v Wright Hassall[1];
“The rules provide a framework within which to balance the interest of both sides. That balance is inevitably disturbed if an unrepresented litigant is entitled to greater indulgence in complying with them than his represented opponent.... Unless the rules and practice directions are particularly inaccessible or obscure, it is reasonable to expect a litigant in person to familiarize himself with the rules which apply to any step which he is about to take”.
[18] Setting aside ex-parte judgment is not automatic. In any case in which a decree is passed ex-parte against a defendant, he or she may apply to the Court by which the decree was passed for an order to set it aside; and if he or she satisfies the court that the summons or notice of hearing was not duly served or that he or she was prevented by any sufficient cause from appearing when the suit was called on for hearing, the court shall make an order setting aside the decree as against him or her upon such terms as to costs or otherwise as it thinks fit and shall appoint a day for proceeding with the suit.
[19] The principles governing the determination of what amounts to sufficient reason or cause for setting aside an ex-parte decree have been severally enunciated in the jurisprudence. The sufficient reason or cause depends on the circumstances of each case.
[20] Noteworthy is the fact that when the case was called on 22-11-2017 to fix for hearing the appellant and the respondent were not present in court and NOAH has been issued on both parties to be present in court on 24-11-2017. On 24-11-2017, counsel for the respondent was present in court but the appellant was absent. The case was fixed for hearing on 05-06-2018.
[21] It is critical to note that the case was fixed for hearing when the appellant was not present in court.
[22] In paragraph (4), (5) and (6) of the affidavit in support of setting aside application, Mr Nilesh Nand, the appellant–deponent avers and there is no reason for disbelieving him that he was never notified or made aware of the date the matter was heard ex parte.
(4) So on 20thJune, 2018 on my way to Magistrate Court, Ba I saw some renovation work taking place at main Magistrate Court house and it can be clarified by the court assistants so I stepped in to the court side to confirm my date schedule and I saw some court assistants sitting inside Court number 2 with door open and upon inquiring I found that the hearing has taken place and judgment was given to me on the same day. Upon inquiry with court assistant what can be done and they advised me you can appeal this matter.
(5) The actual court mention date was set for 6th December, 2017 as well as the date was shifted to 24th November, 2017 via a phone call by court assistant from Magistrate Court, Ba on 23rd November, 2017 advising that the new Magistrate is coming to Ba and we have to come to Ba Court since we have 2 separate cases with the Plaintiff.
Since the Honourable Magistrate was trying to fix hearing for our both cases with the Plaintiff on the same day and at same time Plaintiff’s lawyer asked for 2 different hearing dates within 3 months of time frame.
Our presence to the Magistrate Court, Ba on the hearing for the other civil case with the same Plaintiff which took place o 26th September, 2018 was the same date given to us on 24th November, 2017.
(6) The hearing at Magistrate Court, Ba on 8th June, 2018 as per content in Judgment made without my presence as well as date not matching with dates issued to me of 26th June, 2018.
The Ruling at Magistrate Court, Ba on 5th June, 2018 as per content in Judgment made without my presence besides it is a very serious matter whereby the Hearing is on 8th June, 2018 and the Ruling is on 5th June, 2018.
[23] The question which confronts me in limine is this; whether there was proper service of NOAH on the appellant? Therefore, the substantive question with which I have to deal with is whether the ex parte judgment was regular. It is unfortunate that no argument was addressed to me on the issue of service of NOAH. But I can tell from the case record that the appellant has not been satisfactorily served with the notice issued on 22-11-2017.There is no proof returned in Court. I can conclusively tell from the court record that the NOAH issued by the court on 22-11-2017 was never served on the appellant. Needless to say, a NOAH must be served in person or by post. No evidence of date of service and the mode of service availed. Therefore, the appellant was not properly notified or made aware of the date the matter was fixed for hearing and he had no notification of the date the matter was heard ex parte. This is a failure/irregularity which goes to the root of our conceptions of the proper procedure in litigation and this failure/irregularity invalidates the ex parte judgment. I find that this amount to sufficient reason or cause for setting aside the ex-parte judgment. The appellant has met the threshold for the setting aside of ex-parte judgment. The judgment should be set aside as the appellant was not served with the NOAH for the suit issued by the court on 22-11-2017. It is unfortunate that the learned Magistrate did not advert to the question on the issue of proper service of notice on the appellant. This has created an injustice and prejudice to the appellant. I find that the Magistrate erred in law by failing to consider whether there was proper service of NOAH on the appellant. The Magistrate erred in law and the result arrived at was wrong. On the day of the hearing the Magistrate should have asked the respondent (the original plaintiff) to show proof that the appellant (the original defendant) had been served with NOAH before the matter proceeds for ex-parte hearing. It should be noted that the duty of the court is to do justice and justice for all the parties involved. I find that the NOAH issued by the court was either not duly served on the appellant or was not served at all on the appellant and therefore the consequential judgment was irregular and ought to be set aside by the court ex debito justitiae and the court has no power to impose any terms upon him except as a condition of giving him his costs. Such a judgment is not set aside in the exercise of discretion but as a matter of judicial duty in order to uphold the integrity of the judicial process. The appellant is entitled to have the judgment dated 08.06.2018 set aside ex debito justitiae as being an irregularity. There is a strong distinction between setting aside a 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. But although the court is bound to set aside an irregular judgment ex debito justitiae, it has always exercised discretion as to costs, and has imposed terms as a condition of the exercise of that discretion – a common term being that the defendant shall not bring any action.
[24] The former Court of Appeal for Eastern Africa, in Ali Bin Khamis v. Salim Bin Khamis Kirobe & Others[2] expressed the view that where an order is made without service upon a person who is affected by it, procedural cockups will not deter the court, ex debito justitiae, from setting aside such an order.
Briggs J with whom Worley J and Sinclair, VP. Concurred, stated thus:
On the appeal before us Mr Khanna relied on Craig v Kanseen [1943] 1 All ER 108 as showing that where an order is improperly made without serving a person known to be affected by it and having a statutory right to be served before it can be made, the order is a nullity in the sense that it must be set aside ex debito nullity procedure is unimportant, since the court has inherent jurisdiction to set aside its own order. I accept these principles, as laid down by Lord Greene, MR”.
[Emphasis added]
The appellant applied to set aside the judgment because he wanted to be heard. He was interested in defending the suit. I find that the appellant has met the threshold for the setting aside of ex parte judgment. I am satisfied that the Magistrate was plainly wrong. I should without hesitation set aside the ex parte judgment entered against the appellant on 08.06.2018.
Orders :
4. I make no order as to costs.
........................
Jude Nanayakkara
[Judge]
At Lautoka
Friday, 29th May, 2020.
[1] LLP [2018]UKSC 12
[2] (1956) 1 EA 195
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