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High Court of Fiji |
IN THE HIGH COURT OF FIJI
IN THE WESTERN DIVISION
AT LAUTOKA
CIVIL JURISDICTION
Civil Action No.: 214 of 2019
BETWEEN
EVOLUTION FIJI LIMITED a limited liability company having its registered office at Neel Shivam Lawyers, Level 1, 11 Renwick Road, Suva, Fiji.
PLAINTIFF
A N D
RADISSON HOTELS (FIJI) PTE LIMITED trading as RADISSON BLU RESORT FIJI LIMITED a limited liability company having its registered office at its premises at Denarau Island, Nadi, Fiji.
DEFENDANT
Appearances : (Ms) Joana Takali for the plaintiff
Mr. Melvin Chand for the defendant
Hearing : Monday, 30th September 2019.
Ruling : Friday, 24th January 2020.
R U L I N G
[A] INTRODUCTION
(1) The matter before me stems from an inter-parte notice of motion filed by the plaintiff seeking the grant of the following orders:-
(2) The application is made pursuant to Order 29, rule 1 (2) of the High Court Rules 1988 and under the inherent jurisdiction of the High Court.
(3) The prayer (1) and (2) in the inter-parte notice of motion are mandatory injunctions and payer (3) is for a prohibitory injunction. The defendant opposes the application.
(4) The following affidavits have been filed;
(a) Affidavit in Support of Mathew James McKinley and Asilika Edwin both filed on 28th August, 2019 on behalf of the plaintiff.
(b) Affidavit in Opposition of Denny Akira Tanaka filed on 17th September, 2019.
(c) Affidavit in Reply of Mathew James McKinley filed on 25th September, 2019.
[B] BACKGROUND
(01) The plaintiff and the defendant were parties to a contract for the plaintiff to provide water sporting activities at the defendant’s premises for defendant’s guests as well as the general public. The contract was executed on 25th and 26th July, 2016 for a term commencing on 01st September, 2016 and expiring on 31st August, 2019.
(02) To give the whole picture of the action, I can do no better than set out hereunder the avertments/assertions of the pleadings. In the affidavit in support of the Inter-parte Notice of Motion filed on 28th August, 2019, Mathew James McKinley, a director of the plaintiff company deposes as follows in his affidavit sworn on 26th August, 2019.
Background to the termination of the Contract
“(viii) Include the Contractor’s premises on the checklist of the Operator’s roving security guards (but shall not provide full time security for the Contractor’s premises).”
(3) In the affidavit in support, Asilika Edwin, the Operations Manager of the plaintiff Company deposes as follows in the affidavit sworn on 26th August, 2019.
(4) Denny Akira Tanaka, the director of the defendant’s Hotel deposed as follows in his affidavit in opposition sworn on 16th September, 2019.
(a) the Plaintiff be allowed to complete the 43 days remaining term of contract signed by the Plaintiff and Radisson on 25th and 26th July, 2016.
(b) the Plaintiff be allowed to continue its business operations at Radisson’s premises after the completion of 43 days until the determination of these proceedings.
(c) Radisson by itself and/or its servants and/or agents and/or employees or otherwise howsoever be restrained from interfering with the Plaintiff’s business operations at Radisson’s premises.
(d) Costs.
Response to Plaintiff’s supporting affidavits
Fundamental flaws
Expired contract
Damages an adequate remedy
Conclusion
(5) Mathew James McKinley deposed as follows in his affidavit in reply sworn on 24th September, 2019.
1. I am a Director of the Plaintiff Company and am duly authorized by the
Plaintiff to make and swear this affidavit on its behalf. A copy of the Authority from the Plaintiff to me is annexed in my earlier affidavit in support and is marked as Annexure “A”.
7. I refer to my earlier affidavit at paragraph 7 which states as follows:-
“7. The Defendant on the 19th of July 2019, terminated the
Contract citing that the Plaintiff had repudiated the Contract which was not true.
10. I refer to paragraphs 7, 8 and 9 and stated as follows: -
(i) As to paragraph 7, there was no promise made to be Godwins for a
refund and the allegations made in paragraph 7 of the Defendant’s Affidavit are disputed.
(ii) As to paragraph 8, Statements were given by a guest at the Defendant. This statement is annexed to my earlier affidavit in support and marked as Annexure “E”. Had it not being for Mr.. Paul Stachurski, the Godwins would not have stopped their racial abuse towards Ms. Marama.
(iii) Mr. Paul Stachurski and his wife Carol Wills on the 17th of July 2019 also sent an email to the Defendant through one N. Matai.
(iv) I verily believe that the Defendant failed to verify the statement of
Mr.Paul Stachurski and is only relying on the statement of the Godwins to protect their image.
(v) Annexed hereto and marked with the letter “A” is copy of email dated 17th day of July 2019.
(vi) As to paragraph 9, the Defendant has confirmed that it was not able to protect the Plaintiff under Clause 8.1 (viii) of the Contract. The Plaintiff had to seek assistance of the Defendant’s security. The Godwins tried to cancel the booking on the 11th day of July 2019, and not the 10th of July, 2019.
11. As to paragraphs 10, 11, 12 and 13 I state as follows:-
(i) As to paragraph 10, I do not disagree to the contents, however I was
engaged in the business activities, which was the reason why I could not respond to the Defendant on their terms.
(ii) As to paragraph 11, the Defendant should be aware of the Plaintiff’s
Cancellation Policy and should have advised the Godwins to visit us for the refund. The Defendant cannot deny that it did not know about the Plaintiff’s Cancellation Policy as the Plaintiff has been operating from the Defendant’s premises since 2016.
(iii) As to paragraph 12, it’s sad to see that the Defendant trying to uphold its so called international image and preserve its standard and rapport,
decided to promote racial abuse by refunding the Godwins their monies. The Plaintiff does not engage itself in such a manner even though we are known throughout the world for the excellent activities that we provide.
(iv) I verily believe that should there be another incident where staffs of the
Defendant or any other company operating from the Defendant’s premises is racially abused, the Defendant will once again act in the same manner as it did on the 12th of July 2019.
(v) As to paragraph 13, there was no need for the Defendant to refund the Godwins and go against the Plaintiff’s Cancellation Policy. Annexed hereto and marked with the letter “B” is copy of chain of emails from the 11th of July 2019 till the 12th of July 2019, when I sent a detailed facts of what transpired.
40. I therefore humbly ask this Honorable Court for orders in term of the application filed herein.
[C] THE LEGAL PRINCIPLES
(1) Against this factual background, it is necessary to turn to the applicable law and the judicial thinking in relation to the principles governing “Interlocutory Injunction”.
(2) The plaintiff’s application is made pursuant to Order 29, rule 1 (2) of the High Court Rules, 1988, which provides;
Application for injunction (O.29, r.1)
1.- “(1) An application for the grant of an injunction may be made by any party to a cause or matter before or after the trial of the cause or matter, whether or not a claim for the injunction was included in that party’s writ, originating summons, counter claim or third party notice, as the case may be.
(2) Where the applicant is the Plaintiff and the case is one of the urgency and the delay caused by proceeding in the ordinary way would entail irreparable or serious mischief such application may be made ex parte in affidavit but except as aforesaid such application must be made by Notice of Motion or Summons.
(3) The plaintiff may not make such an application before the issue of the writ or originating summons by which the cause or matter is not be begun except where the case is one of urgency, and in that case the injunction applied for may be granted on terms providing for the issue of the writ or summons and such other terms, if any, as the Court thinks fit.”
(3) The governing principles applicable when considering an application for interim injunction were laid down in the leading case of “American Cyanamid Co v Ethicon Ltd”[1] as follows;
(A) Whether there is a serious question to be tried?
(B) Whether damages would be an adequate remedy?
(C) Whether balance of convenience favour granting or refusing
interlocutory injunction?
In that case Lord Diplock stated the object of the interlocutory injunction as follows at p. 509;
“The object of the interlocutory injunction is to protect the plaintiff against injury by violation of his right for which he could not be adequately compensated in damages recoverable in the action if the uncertainty were resolved in his favor at the trial: but the plaintiff’s need for such protection must be weighed against the corresponding need of the defendant to be protected against injury resulting from his having been prevented from exercising his own legal rights for which he could not be adequately compensated under the plaintiff’s undertaking in damages if the uncertainty were resolved in the defendant’s favor at the trial. The court must weigh one need against another and determine where the balance of convenience lies.”
In Hubbard & Another v. Vosper & Another[2] Lord Denning gave some important guidelines on the principles for granting an injunction where his Lordship said:
“In considering whether to grant an interlocutory injunction, the right course for a judge is to look at the whole case. He must have regard not only to the strength of the claim but also to the strength of the defence, and then, decide what is best to be done. Sometimes it is best to grant an injunction so as to maintain the status quo until the trial. At other times, it is best not to impose a restraint upon the defendant, but leave him free to go ahead. For instance, in Fraser v Evans (1969) 1 GB 349, although the Plaintiff owned the copyright, we did not grant an injunction, because the Defendant might have a defence of fair dealing. The remedy by interlocutory injunction is so useful that it should be kept flexible and discretionary. It must not be made the subject of strict rules.”
(4) In this action, the plaintiff, the Evolution Fiji Ltd seeks, inter alia
(i) Judgment in the sum of $110,000.00 (One Hundred Ten Thousand Dollars) for lost revenue.
(ii) A declaration that the termination of the Contract by the Defendant was unlawful.
(iii) Damages for breach of Contract signed by the Plaintiff and the Defendant on the 25th and 26th days of July, 2016.
(iv) An order that the Plaintiff’s Contract be renewed for a further one (1) year commencing from the date of judgment.
The motion now before me is primarily for interlocutory relief in the form of a mandatory injunction to: -
(01) plaintiff be allowed to complete 43 days remaining of the contract signed by the plaintiff and the defendant on the 25th and 26th days of July, 2016.
(02) plaintiff be allowed to continue its business operations at the defendant’s premises after the completion of 43 days until the determination of these proceedings.
“The Cyanamid guidelines are not relevant to mandatory injunctions. There are important differences between prohibitory and mandatory injunctions. By granting a prohibitory injunction, the court does no more than prevent for the future the continuance or repetition of the conduct of which the plaintiff complains. The injunction does not attempt to deal with what has happened in the past; that is left for the trial, to be dealt with by damages or otherwise. On the other hand, a mandatory injunction tends at least in part to look to the past, in that it is often a means of undoing what has already been done, so far as that is possible. Furthermore, whereas a prohibitory injunction merely requires abstention from acting, a mandatory injunction requires the taking of positive steps, and may require the dismantling or destruction of something already erected or constructed. This will result in a consequent waste of time, money and materials if it ultimately established that the defendant was entitled to retain the erection. Kindersley V.C said in Gale v Abbot (1862)10 W.R. 748, 750, an interlocutory application for a mandatory injunction was one of the rarest cases that occurred, “for the court would not compel a man to do so serious a thing as to undo what he had done except at the hearing”. Even if today the degree of rarity of such application is not quite so profound, the seriousness of such an order remains as an important factor. Another aspect of the point is that if a mandatory injunction is granted on motion, there will normally be no question of granting a further mandatory injunction at the trial; what is done is done, and the plaintiff has on motion obtained, once and for all, the demolition or destruction that he seeks. Where the injunction is prohibitory, however, there will often still be a question at the trial whether the injunction should be dissolved or continued; except in relation to transient events, there will usually be no question of the plaintiff having obtained on motion all that he seeks. The case has to be unusually strong and clear before a mandatory injunction will be granted at the interlocutory stage even if it is sought in order to enforce a contractual obligation. On motion, as contrasted with the trial, the court is far more reluctant to grant a mandatory injunction than it would be to grant a comparable prohibitory injunction. In a normal case the court must, inter alia, feel a high degree of assurance that at the trial it will appear that the injunction was rightly granted; and this is a high standard than is required for a prohibitory injunction”[3].
In Honeymoon Island (Fiji) Ltd v Follies International Ltd[4] Pathik, Powell and Bruce JJA in the Court of Appeal said:
“[12] The grant of interlocutory injunctive relief is discretionary. The Court must be satisfied that there is a serious question to be tried, in other words whether the applicant has any real prospect of succeeding in its claim for a permanent injunction at the trial. If the Court is satisfied that there is a serious question to be tried the Court must then consider whether the balance of convenience lies in favor of granting or refusing to grant the interlocutory relief sought: American Cyanamid Co v Ethicon Ltd [1975] UKHL 1; [1975] AC 396.
[13] As a prelude to considering the balance of convenience the Court must consider whether or not the applicant will suffer irreparable loss, being loss for which an award of damages would not be an adequate remedy, either because of the nature of the threatened loss, or because the party sought to be restrained would not be in a position to satisfy an order for damages. “If damages....... Would be an adequate remedy and the defendant would be in a financial position to pay them, no interlocutory injunction should normally be granted”: American Cyanamid (supra) at 408.”
[Emphasis added]
[5] The principles are summarized in Nottingham Building Society v Eurodynamics Systems[5] (summarized in the White Book 1999 at paragraph 29/L/1).
“First, the overriding consideration is which course is likely to involve the least risk of injustice if it turns out to be “wrong” in the sense of granting an interlocutory injunction to a party who fails to establish his right at trial (or would fail if there was a trial) or, alternatively, in failing to grant an injunction to a party who succeeds (or would succeed) at trial.
Secondly, in considering whether to grant a mandatory injunction, the Court must keep in mind that an order which requires a party to take some positive step at an interlocutory stage, may well carry a greater risk of injustice if it turns out to have been wrongly made than an order which merely prohibits action, thereby preserving the status quo.
Thirdly, it is legitimate, where a mandatory injunction is sought, to consider whether the Court does feel a high degree of assurance that the plaintiff will be able to establish this right at a trial. That is because the greater the degree of assurance the plaintiff will ultimately establish his right, the less will be the risk of injustice if the injunction is granted.”
[Emphasis added]
[6] This formulation was approved by Phillips LJ in the English Court of Appeal in Zockoll Group Ltd v Mercury Communications Ltd[6], Phillips LJ stated:
“In Shepherd Homes Ltd v Sandham, Megarry J spelled out some of the reasons why mandatory injunctions generally carry a higher risk of injustice if granted at the interlocutory stage: they usually go further than the preservation of the status quo by requiring a party to take some new positive step or undo what he has done in the past; an order requiring a party to take positive steps usually causes more waste of time and money if it turns out to have been wrongly granted than an order which merely causes delay by restraining him from doing something which it appears at the trial he was entitled to do; a mandatory order usually gives a party the whole of the relief which he claims in the writ and make it unlikely that there will be a trial.........An order requiring someone to do something is usually perceived as a more intrusive exercise of the coercive power of the state than an order requiring him temporarily to refrain from action. The court is therefore more reluctant to make such an order against a party who has not had the protection of a full hearing at trial.”
[Emphasis added]
[7] The note at O.29/1/5 of the White Book ends with a paragraph that begins:
“The Cyanamid guidelines are not relevant to mandatory injunctions. The case has to be unusually strong and clear before a mandatory injunction will be granted at the interlocutory stage even if it is sought in order to enforce a contractual obligation.”
[8] This note is consistent with the statement of Megarry J. in Shepherd Homes Ltd v. Sandham[7] that:
“.....on motion, as contrasted with the trial, the Court is far more reluctant to grant a mandatory injunction than it would be to grant a comparable prohibitory injunction. In a normal case the Court must, inter alia, feel a high degree of assurance that at the trial it will appear that the injunction was rightly granted; and this is a higher standard than is required for a prohibitory injunction.”
[9] The note in the White Book is also consistent with the comment made by Mustill L.J. in relation to that statement by Megarry J. in Locabail Finance Ltd v. Agroexport[8]
“It was pointed out in argument that the judgment of Megarry J. antedates the comprehensive review of the law as to injunctions given by the House of Lords in American Cyanamid Co. v Ethicon Ltd [1975] UKHL 1; [1975] A.C. 396 but to my mind at least, the statement of principle by Megarry J. in relation to the very special case of the mandatory injunction is not affected by what the House of Lords said in the Cyanamid case.”
[D] CONSIDERATION AND THE DETERMINATION
(1) The defendant opposes the plaintiff’s application for interlocutory reliefs for the following reasons; (reference is made to paragraph (69) of the defendant’s written submission filed on 27/09/2019).
(a) The Plaintiff claims loss of revenue which can be calculated and paid in monies worth. The Plaintiff’s claim for damages in the sum of $110,000 in the Statement of Claim is evidence that the Plaintiff itself agrees that damages are an adequate remedy.
(b) Prayers 1 and 2 are requests for mandatory injunctions. The test for mandatory injunctions is higher than the American Cynamid prohibitory injunction test. The Plaintiff has the heavy burden of establishing on the affidavits a strong and clear case which it has failed to.
(c) The Plaintiff does not have a strong clear case to warrant mandatory injunctions. Radisson’s position is that the Plaintiff repudiated the Contract between Radisson and the Plaintiff by contract – non-performance for 7 consecutive days and breach of the dispute resolution process under the Contract. Accordingly, the Plaintiff is not entitled to any remedies, whether under this application or the damages it seeks in the Statement of Claim.
(d) The Contract had an end date of 31st August, 2019 and has expired. The purpose of an interlocutory injunction is to preserve the status quo but it cannot recreate the status quo ante. The 43 days (from 20 July 2019 to 31 August 2019) of performance that the Plaintiff requests have lapsed and an injunction cannot re-create those days for performance.
(e) Under the American Cynamid principles an interlocutory injunction should be granted if the Plaintiff can satisfy likelihood that it will obtain a permanent injunction at the trial. Here the Plaintiff seeks no permanent injunction in its Statement of Claim, there is no claim for orders for specific performance. Instead the Plaintiff claims damages in the sum of $110,000 (without providing any particulars of the figure claimed). This application is accordingly wholly inconsistent with the Statement of Claim and should be dismissed in limine.
(f) A grant of the injunctions prayed for would allow the Plaintiff to perform and recover the $110,000 damages it claims in the Statement of Claim and would remove the need for a trial, the grant of injunctions under this application would amount to granting final orders.
(g) Radisson has already engaged the services of other providers and does not need the Plaintiff’s services anymore. To do so would put unnecessary expenses on Radisson and disrupt its services as well as contractual relations with its new service providers.
(2) The defendant submits that; (Reference is made to paragraph (10) to (16) of the defendant’s written submissions filed on 21/09/2019).
(3) On the other hand the plaintiff submits that; [reference is made to paragraphs (05) to (20) of the plaintiff’s written submissions filed on 27/09/2019].
(*) The Plaintiff disputes that it repudiated the Contract to provide Activities
(hereinafter called “the Contract”) signed between the Plaintiff and the Defendant on the 25th and 26th days of July, 2016.
(*) It was the Defendant through its Solicitors on the 19th day of July, 2019 terminated the Contract. This termination was not given to the Plaintiff but to the Plaintiff’s Solicitors. A copy of letter dated the 19th day of July, 2019 is marked as Annexure “C” in the Plaintiff’s Affidavit in Support filed on the 28th of August, 2019 which states as follows:-
“We refer to your letter of 19th July, 2019 the contents of which are denied. We will respond in more detail shortly.
Radisson regards your client’s behaviour over the last week as amounting to a repudiation of the contract which is now formally at an end. Radisson will make alternative arrangements and your client is required to vacate the premises and property by COB Saturday 20th July, 2019.”
(*) The Defendant by giving the termination letter dated 19th July, 2019 through its Solicitors breached Clause 2.4 of the Contract (page 4 of the Contract) which states as follows:-
“In the event the Contractor fails to carry out the Activities to the reasonable satisfaction of the Operator (including without limitation in accordance with the specifications described in clause 2.3) the Operator shall give notice in writing of such dissatisfaction. In the event that the Contractor fails to rectify such performance shortfalls within one month of the written notice the Operator may terminate the contract on 45 days’ notice and go through a mediation process to solve the issue or alternatively lodge a dispute for arbitration.”
(the bold and underlining is ours)
(*) We further refer to Clause 18.1 of the Contract (page 14 of the Contract) which states as follows:-
“A party must not start arbitration or court proceedings (except proceedings seeking injunctive, declaratory or interlocutory relief) in respect of a dispute arising out of this Contract (“Dispute”) unless it has complied with this clause (18).”
(*) The Defendant in its Affidavit in Opposition in paragraph 18 states that the
Plaintiff breached the Contract and also breached the dispute resolution mechanism.
(*) We submit that the Plaintiff did not breach the dispute mechanism as it did not
receive a 45 days’ notice under Clause 2.4 of the Contract. If the Plaintiff had received the 45 days’ notice it would then had the opportunity to start as dispute resolution.
(*) Any Notice to be given under the Contract has to be followed pursuant to Clause
3.3 of the Contract (page 6 of the Contract) which states as follows:-
“3.3 Any notices which are to be served upon the Contractor of the Operator pursuant to this Contract shall be in writing and shall be deemed to have been sufficiently served if they are delivered in person to the representative of the other party or sent by repaid post in correctly addressed envelope to the other party’s address as listed in Schedule B of this Contract.”
(*) We submit that no Notice from the Defendant was served upon the Plaintiff in
accordance of Clause 3.3 of the Contract, thus the Defendant being in breach.
(*) The Plaintiff is entitled to complete the remaining 43 days being the term of the
Contract which was till the 31st August, 2019. However, we refer to paragraph 23 of the Defendant’s Affidavit which states that the extension was till the 30th of September, 2019.
(*) These proceedings were filed before 30th September, 2019 and at that Contract had not expired. The Plaintiff had filed an Ex-Parte application which was then turned into Inter-parte. We submit that the Plaintiff has now 73days remaining until the expiration of the Contract and seeks an order that it be now allowed to complete the 73 days remaining under the Contract and not 43 days.
(*) The Plaintiff in its application has also asked that it be allowed to operate at the
Defendant’s premises until the determination of these proceedings. The Plaintiff had not repudiated the Contract at any time.
(*) The Defendant had offered the Plaintiff the renewal of the Contract for a further
period of one (1) year, which the Plaintiff accepted. The Defendant had also via email sent to the Plaintiff its comments and requirements for the renewal.
(*) We refer to Annexure “G” in the Plaintiff’s Affidavit in Reply, which is an email dated 12th July, 2019 from the General Manager of the Defendant to Mr. McKinley, a director of the Plaintiff. It was agreed between the parties that the Contract would be renewed for another year.
(*) The offer and acceptance between the parties are clear in the email dated 12th
July, 2019. The terms for renewal were never reached as the Defendant unlawfully terminated the Contract.
(*) Since there is no extension of the Contract, the Plaintiff has a right under Clause
1.4 of the Contract (page 2 of the Contract) to continue operating its business on a month to month basis. Clause 1.4 states as follows:-
“1.4 In the absence of any agreement to extend or renew this Contract in terms of Clause 1.3 then this Contract will be deemed to continue (except for the rights under Clause 1.3) after the expiry of the Terms on a month to month basis unless and until one party gives to the other party one month’s notice in writing that this Contract is to terminate and that notice has expired.”
(*) We submit that there was no proper Notice given by the Defendant to the Plaintiff
terminating the Contract and therefore the Plaintiff ought to be allowed to operate its business from the Defendant’s premises until the determination of these proceedings where the Plaintiff has asked in its Statement of Claim for the Contract to be renewed for a further year from the date of judgment.
(4) Does the Court feel a high degree of assurance about the plaintiff’s chances of establishing its right?
I gather from the affidavit evidence that the plaintiff did not provide water sporting services under the contract at Radisson (the defendant) from 13th July, 2019 to 19th July, 2019. (Mrs) Edwin at paragraphs (10) to (14) and Mr. McKinley at paragraphs (23) and (24) of their respective affidavits in support confirms that the plaintiff ceased operations at Radissons. The plaintiff’s excuse for not providing water sporting services under the contract at Radisson is expressed in paragraph (23) of the affidavit in support of Mr.. McKinley which he swore on 26th August, 2019. He said this:
“The plaintiff employs local citizens for the conduct of its business. After the incident that occurred on the 11th of July, 2019 and the defendant’s failure to ensure the staff of the plaintiff are protected, the staffs of the plaintiff were reluctant to continue with the plaintiff’s business operations.”
[Emphasis added]
(5) I further gather from the affidavit evidence that there were email correspondences and meetings between Mr. Tanaka, Mr. Homsy, (Ms) Spillane (Radissons) and Mr. McKinley (the plaintiff’s director). The purpose of those correspondences and meetings, at least as it appeared was to seek to persuade the plaintiff to negotiate to resolve the issue.
On 14th July, 2019 Mr.. Tanaka (Radisson) emailed Mr. McKinley (Plaintiff’s director) inviting him for a meeting to resolve any issues. Mr. McKinley replied that the plaintiff had engaged lawyers (instead of the mandatory dispute resolution mechanism under clause 18 of the Contract) and that the plaintiff reserved working on Radisson’s premises until the situation was resolved. [Mr. McKinley’s email is at annexure DAT 3 in the affidavit in opposition]. Radisson’s Mr. Homsy responded to Mr. McKinley reminding him to comply with the Contract and resume operations immediately. Mr. Homsy referred to the dispute resolution process under clause 18 of the Contract saying that immediate cessation of guest services was not a reasonable approach. [Annexure DAT 3]. On 14th July, 2019 Radisson’s Financial Controller Ms. Christina Spillane separately emailed the plaintiff’s directors enquiring about the closure of services. 14th July, 2019 was a busy day for Radisson with many guests wanting to utilize the plaintiff’s services. Ms. Spillane requested that operations immediately resume and to discuss any issues in a meeting schedule for the following week, [Annexure DAT 4].
Mr. McKinley walked out of the meeting on 18th July, 2019 which was organized to resolve the issues, because Radisson’s Director of Food & Beverage, Mr. Tanaka, was present. Mr. Tanaka is a senior Radisson staff member and a recognized agent under the Contract. Activities including water sporting activities fall under Mr. Tanaka’s direct management and he was appointed to liaise with the plaintiff, as he had done previously. More relevantly, Mr. Tanaka had first-hand knowledge of the incident with the Godwins.
On 19th July, 2019 the defendant’s solicitors wrote to the plaintiff’s solicitors (annexure ‘C’ in McKinley’s affidavit) accepting the plaintiff’s repudiation and terminated the contract and arranged for the vacation of the premises. The plaintiff complied with and removed its equipment.
(6) It was McKinley’s contention that the meeting was to be between the General Manager of the defendant, himself and (Ms) McKinley. The excuse made by the plaintiff for walking out of the meeting was that the defendant’s General Manager, Mr. Homsy brought with him Mr. Tanaka who is the Food and Beverages Manager and Mr. Clyde who is the Hotel Manager. The plaintiff says that Mr. Homsy should be the only person to meet to resolve the issue.
This contention seems to me to be of little force. I shall return to this later.
(7) The plaintiff raised two issues in its pleadings; First, it denied that it had repudiated the Contract; Secondly, it denied that the defendant could terminate the Contract at the date alleged because Clause 2.4 of the Contract (plaintiff should receive 45 days’ notice) and Clause 3.3 of the Contract (notices should be served on the plaintiff) have not been invoked by the defendant. The plaintiff alleges that (1) the defendant’s letter of termination (annexure “c” in Mr. McKinley’s supporting affidavit) was not served on the plaintiff but was served on the plaintiff’s solicitors.(2) the defendant by giving the termination letter dated 19-07-2019 through its solicitors breached clause 2.4 of the contract which says “in the event the contractor fails to carry out the activities to the reasonable satisfaction of the operator, the operator may terminate the contract on 45 days’ notice”. The plaintiff claimed a declaration that the defendant’s notice of termination dated 19/07/2019 was not valid and claimed damages for breach of Contract by the defendant by termination of the Contract.
(8) I’m deciding the issue of repudiation which arises in this case, the guiding principle is that enunciated by Lord Coleridge CJ in Freeth v Burr[9].
“In cases of this sort, where the question is whether the one party is set free by the action of the other, the real matter for consideration is whether the acts or conduct of the one do or do not amount to an intimation of an intention to abandon and altogether to refuse performance of the contract.”
The matter is to be considered objectively – per Bowen LJ in Johnstone v Milling[10]
“The claim being for wrongful repudiation of the contract it was necessary that the plaintiff’s language should amount to a declaration of intention not to carry out the contract, or that it should be such that the defendant was justified in inferring from it such intention. We must construe the language used by the light of the contract and the circumstances of the case in order to see whether there was in this case any such renunciation of the contract”.
The importance of looking at the whole circumstances of the case was emphasized by Lord Selborne LC in Mersey Steel & Iron Co Ltd v Naylor, Benzon & Co[11] and by Singleton LJ in James Shaffer Ltd v Findlay Durham & Brodie[12]
There is a tract of authority which vouches the proposition that the assertion by one party to the other of a genuinely held but erroneous view as to the validity or effect of a contract does not constitute repudiation. In the Spettabile[13] case the plaintiffs sent to the defendants a letter claiming that certain contracts were no longer binding on them and followed it up with service of a writ seeking declarations to that effect. The Court of Appeal held that the plaintiff’s conduct did not amount to repudiation of the contracts. Warrington LJ said[14] with reference to the letter:
‘It seems to me that that is not telling the defendants that whatever happens, whatever is the true state of the case, whether the contracts are binding on the plaintiffs or not, they will not perform them: but that they have instructed their Solicitors to take proceedings with the object of having it determined that the contracts are not binding upon the plaintiffs and are at an end .....[and with reference to the writ]......I think that it is desirable to say this, that in my opinion where one party to a contract conceives that he is no longer bound by the contract or has a right to have it rescinded or declared null and void, and issues a Writ for the purpose of obtaining that which he believes to be his right, he does not by that mean to repudiate the performance of the contract in any event. It seems to me that he submits to perform it if the court, as the result of the action, comes to the conclusion that he is bound to perform it, and it cannot be taken to be an absolute repudiation.’
Atkin LJ, after observing that it must be shown that the party to the contract made quite plain his own intention not to be bound by it, said[15]:
‘......the substance [of the Writ] appears to me to be this: that the plaintiffs in the action are asking the court to declare whether or not they are any longer bound by the contracts. It appears to me that that is an entirely different state of facts altogether from an intimation by the plaintiffs, apart from the courts of law, that they in any event are not going to perform the contracts. It is something quite different from a repudiation. So far from expressing the intention of the parties not to perform the contracts, it appears to me to leave it to the court to say whether or not the contract is to be performed, and if the court says it is, then it impliedly states that it will be performed. I think, therefore, there was no repudiation of the contract.’
(9) Mr. McKinley, the director of the plaintiff company in paragraphs 23 of his affidavit in support said that the plaintiff did not provide water sporting services from 13/07/2019 because of the defendant’s failure to ensure that the staffs of the plaintiff are protected. (Ms.) Asilika Edwin, the Operations Manager of the plaintiff in paragraphs (10) to (14) in her affidavit in support said that the plaintiff did not provide water sporting services under the Contract at Radissons from 13th July, 2019 to 20th July, 2019.
I desire to observe that the dispute arose with the plaintiff’s own customer (not a Radisson guest) where the plaintiff alleges its staff member was called a ‘monkey’ – a conversation which Radisson was never a party to. Under these circumstances, I feel that the defendant is not required to ensure that the staffs of the plaintiff are protected and it was not open to the plaintiff to rely on the defendant’s failure to ensure that the staffs of the plaintiff are protected to refuse to provide water sporting services under the Contract. The plaintiff ceased operation (water sporting services) unless and until the defendant gives an assurance that the plaintiff’s staffs are protected. I feel that relying on the defendant’s failure to ensure that the plaintiff’s staffs are protected is totally abusive, or lacking in good faith. I believe that the plaintiff’s failure to provide water sporting services under the Contract (relying on the defendant’s failure to ensure that the plaintiff’s staffs are protected) is a conduct deserving condemnation. I feel that the plaintiff did not have a valid reason for immediate cessation of water sporting services under the Contract because; (1) The dispute arose with the plaintiff’s staff and the plaintiff’s own customer (not a Radisson guest); (2) Radisson was never a party to the alleged conversation or dispute. (3) Radisson cannot be held responsible for the conduct of the plaintiff’s own customers. I believe that the plaintiff’s failure to provide water sporting services under the Contract relying on the defendant’s failure to ensure that the plaintiff’s staffs are protected is totally abusive, or lacking in good faith.
I feel that the plaintiff’s conduct has amounted to a repudiation of the Contract which entitles the innocent party (the defendant) to treat the Contract as terminated, and claim damages for the breach by repudiation of the Contract by the plaintiff.
However, I feel that the defendant regarded the Contract as still alive and insisted on performance at the time emails marked as annexure DAT -3 and DAT -4 were written. The defendant had not accepted the repudiation; and repudiation, however wrongful is nugatory until accepted by the other contracting party.
The right to terminate the Contract as a result of the repudiation may be lost where an innocent party has affirmed the Contract. This occurs where the innocent party, although entitled to choose whether to treat the Contract as continuing or to accept the repudiation and treat himself as discharged, decides to treat the Contract as continuing. However, he will not be held to have elected to affirm the Contract unless (1) he has knowledge of the facts giving rise to the breach, (2) he has knowledge of his legal right to choose between the alternatives open to him and (3) if implied affirmation there must be some unequivocal act from which it may be inferred that he intends to go on with the Contract or from which it may be inferred that he will not exercise his right to treat the Contract as repudiated. It must be shown that the unequivocal act was done with knowledge of the breach and of his right to choose. Peyman v Lanjani[16].
I am satisfied by the above email correspondences that the defendant had demonstrated an intention to go on with the Contract. It was an unequivocal act. The only issue that requires consideration is whether at the time the defendant wrote annexure DAT-3 and DAT-4 it had knowledge of its right to choose between terminating the Contract or remaining bound to perform its obligations. In my judgment the answer is in the negative.
At the costs of some repetition, I state that the defendant stated on affidavit that on 14th July, 2019 Mr.Tanaka (Radisson) emailed Mr. McKinley (Plaintiff’s director) inviting him for a meeting to resolve any issues. Mr. McKinley replied that the Plaintiff had engaged lawyers (instead of the mandatory dispute resolution mechanism under clause 18 of the Contract) and that the plaintiff reserved working on Radisson’s premises until the situation was resolved. [Mr. McKinley’s email is at annexure DAT 3 in the affidavit in opposition].
As stated earlier, Radisson’s Mr. Homsy responded to Mr. McKinley reminding him to comply with the Contract and resume operations immediately. Mr. Homsy referred to the dispute resolution process under clause 18 of the Contract saying that immediate cessation of guest services was not a reasonable approach. [Annexure DAT 3].
As stated, on 14th July, 2019 Radisson’s Financial Controller Ms. Christina Spillane separately emailed the plaintiff’s directors enquiring about the closure of services. 14th July, 2019 was a busy day for Radisson with many guests wanting to utilize the plaintiff’s services. Ms. Spillane requested that operations immediately resume and to discuss any issues in a meeting schedule for the following week, [Annexure DAT 4].
Mr. McKinley walked out of the meeting on 18th July, 2019 which was organized to resolve the issues, because Radisson’s Director of Food & Beverage, Mr. Tanaka, was present. Mr. Tanaka is a senior Radisson staff member and a recognized agent under the Contract. Activities including water sporting activities fall under Mr. Tanaka’s direct management and he was appointed to liaise with the plaintiff, as he had done previously. More relevantly, Mr. Tanaka had first-hand knowledge of the incident with the Godwins.
It was McKinley’s contention that the meeting was to be between the General Manager of the defendant, himself and (Ms) McKinley. The excuse made by Mr. McKinley for walking out of the meeting was that the defendant’s General Manager, Mr. Homsy brought with him Mr. Tanaka who is the Food and Beverages Manager and Mr. Clyde who is the Hotel Manager. The plaintiff says that Mr. Homsy should be the only person to meet to resolve the issue. This was the attitude of the plaintiff.
It appears to me that the presence of the defendant’s Food and Beverages Manager, Mr. Tanaka and the Hotel Manager, Mr. Clyde at the meeting does not make a great deal of difference and is not an excuse to the plaintiff’s director Mr. McKinley to walk out of the meeting. I do not believe there was any inappropriateness in Mr. Homsy (the director of the defendant) attending the meeting with Mr. Tanaka (the food and beverages manager of the defendant) and Mr. Clyde ( the hotel manager of the defendant). It seems to me that the plaintiff’s refusal stems not from a genuine dispute as to the participants of the meeting but rather from a desire to reject the performance of the contract.
I see no ground on which Mr. McKinley (the plaintiff’s director) could avoid attending the scheduled meeting arranged by the defendant. Walking out of the meeting is totally abusive or lacking in good faith and would constitute further conduct on the plaintiff’s part which can itself be regarded as having repudiatory character. The plaintiff thereby demonstrated nothing more than an adherence to their position as they had earlier expressed it.
All I need say now is this; when one examines the totality of the plaintiff’s conduct and its impact on the defendant it is plain that the plaintiff was evincing intent not to be bound by the contract. Under these circumstances, I feel that the plaintiff’s continued, long and immediate cessation of guest services (snorkeling activities) may constitute repudiation of the contract. Therefore, it was legitimate for the defendant to regard plaintiff as having repudiated the contract by 19-07-2019. The defendant is entitled to terminate the contract on the stated ground and could claim damages for the breach by repudiation of the contract by the plaintiff.
Next, turning to the question of termination, normally, a letter signifying that the party was terminating the contract would be sufficient notice to the other party that the giver of the notice was terminating the contract. The defendant stated on affidavit that on 19th July, 2019 the defendant’s solicitors wrote to the plaintiff’s solicitors (annexure ‘C’ in McKinley’s affidavit) accepting the plaintiff’s repudiation and terminated the contract and arranged for the vacation of the premises. The plaintiff complied with and removed its equipment. The defendant argued that the plaintiff’s immediate cessation of guest services was a repudiation of the contract which it accepted and there by brought the contract to an end by the termination letter. The question is the defendant’s alleged failure to; (1) serve the notice of termination on the plaintiff personally (2) give 45 days’ notice.
What is the effect of this? Was it a fatal deficiency?
Had the plaintiff waived the time limit requirement or was estopped from relying on it?
Had the plaintiff lost all rights against the defendant by accepting the termination letter?
Besides, the effect of section 12(2) of the Property Law Act is that a breach of a stipulation as to time is not of itself a repudiatory breach.
These are matters which will ultimately have to be resolved at the trial. For the purposes of my task at this interlocutory stage, it is sufficient to say that there was some intention to abandon or repudiate the Contract. This is a case in which I do not feel a high degree of assurance that the plaintiff will succeed in establishing that the Contract was not repudiated by them; or, to put the point the other way round, I feel confidence that the defendant will show that there has been a repudiation of the Contract by the plaintiff.
(10) I remind myself the words of ‘Megarry’ J in ‘Shepherd Homes Ltd v Sandham’[17].
“Third, on motion, as contrasted with the trial, the court is far more reluctant to grant a mandatory injunction than it would be to grant a comparable prohibitory injunction. In a normal case the court must, inter alia, feel a high degree of assurance that at the trial it will appear that the injunction was rightly granted; and this is a higher standard than is required for a prohibitory injunction.
(11) The following passage of Hoffman Justice in “ Films Rover International and Others v Cannon Film Cells Ltd[18], is illuminating;
“ The principle dilemma about the grant of interlocutory injunctions, whether prohibitory
or mandatory, is that there is by definition a risk that the court may make the “wrong” decision, in the sense of granting an injunction to a party who fails to establish his right at the trial (or would fail if there was a trial) or alternatively, in failing to grant an injunction to a party who succeeds (or would succeed) at trial. A fundamental principle is therefore that the court should take whichever course appears to carry the lower risk of injustice if it should turn out to have been “wrong” in the sense I have described. The guidelines for the grant of both kinds of interlocutory injunctions are derived from this principle.
The passage quoted from Megarry J. in Shepherd Homes v. Sandham qualified, as it was, by the words “in a normal case,” was plainly intended as a guideline rather than an independent principle. It is another way of saying that the features which justify describing an injunction as mandatory will usually also have the consequence of creating a greater risk of injustice if it is granted rather than withheld at the interlocutory stage, unless the court feels a high degree of assurance that the plaintiff would be able to establish his right at trial. I have taken the liberty of reformulating the proposition in this way in order to bring out two points. The first is to show that semantic arguments over whether the injunction as formulated can properly be classified as mandatory or prohibitory are barren, the question of substance is whether the granting of the injunction would carry that higher risk of injustice which is normally associated with the grant of a mandatory injunction.
The second point is that in cases in which there can be no dispute about the use of the term “mandatory” to describe the injunction, the same question of substance will determine whether the case is normal and therefore within the guideline, or exceptional and therefore requiring special treatment. If it appears to the court that exceptionally the case is one in which withholding a mandatory interlocutory injunction would in fact carry a greater risk of injustice than granting it, even though the court does not feel a high degree of assurance about the plaintiff’s chances of establishing his right, there cannot be any rational basis for withholding the injunction”.
(Emphasis added)
A similar point was considered subsequently by the Court of Appeal in Leisure Data v. Bell [19] and said that:
Where what is in question is an interlocutory mandatory injunction, general guidelines, which were approved by this court in the Lockabal case, were given by Megarry J. in Shepherd Homes v. Sandham [1971] Ch. 340 at 347, where at B, he approved a passage in Halsbury saying that in the absence of special circumstances a mandatory injunction will not be granted on motion. At page 349 B he said that:
“...it is plain that in most circumstances a mandatory injunction is likely, other things being equal, to be more drastic in its effect than a prohibitory injunction. At the trial of the action, the court will, of course, grant such injunctions as the justice of the case requires; but at the interlocutory stage, when the final result of the case cannot be known and the court has to do the best it can, I think the case has to be unusually strong and clear before a mandatory injunction will be granted, even if it is sought in order to enforce a contractual obligation.”
Whether damages would be a sufficient remedy to the plaintiff if I refuse the injunction sought and the plaintiff ultimately succeeds at the trial?
(12) The court’s do not grant an injunction if damages are an adequate remedy. Diplock LJ in ‘American Cyanamid’ (supra) said at page 510:
“If damages in the measure recoverable at common law would be an adequate remedy and the defendant would be in a financial position to pay them, no interlocutory injunction should normally be granted, however strong the plaintiff’s claim appeared to be at that stage”.
(13) I accept as Counsel for the defendant submits;
“On a perusal of the plaintiff’s statement of claim, the plaintiff is suing for breach of the Contract and seeks inter alia damages in the sum of $110,000. This shows that the plaintiff itself considers damages to be an adequate remedy.”
Counsel went on to submit this; “The plaintiff in this application seeks to perform the remaining 43 days term of the Contract. Ms. Edwini at paragraph 15 of her affidavit in support indicates that the plaintiff on average earned $3,000 per day.
If the plaintiff is allowed to operate for the remaining 43 days terms, it would be able to recover its $110,000 claim and the reliefs sought inter alia in the statement of claim would be satisfied. In other words, the plaintiff would have obtained final remedies and there would be no need for a trial. (I have been referred to Zockoll Group Ltd v Mercury Communications Ltd[20]). Even if the $110,000 claimed does not represent the purported losses for the 43 days, lost revenue for those 43 days can be calculated (like the plaintiff has calculated the $110,000) and paid.”
I acknowledge the force of the submissions of Counsel for the defendant. The position as to damages appears to me to be this; the loss of the plaintiff if the injunction is refused is easy to calculate and is eminently compensable in damages. In above circumstances, there would be no doubt that damages would be an adequate remedy to the plaintiff.
It is common ground that Radisson is an international brand. The defendant’s own evidence suggests that Radisson has substantial assets in Fiji. There is no evidence that it cannot pay any damages. I am satisfied that if the injunction were refused then there is reasonable prospect that the defendant would be in a position to pay damages to the plaintiff if the plaintiff succeeds at trial.
(14) I turn, then, to consider whether damages would be an adequate remedy to the defendant in the event that an injunction is granted at this stage, but the plaintiff fails at trial. The primary difficulty would be in quantifying that claim. As the affidavit evidence shows, tensions have already flared between the plaintiff’s directors /employees and Radisson’s Managers/employees. The defendant says that they have now obtained alternative services from water sporting service provider and says that they no longer required the services of the plaintiff. The mandatory injunctions sought required the Radisson to re-engage the services of the plaintiff. It is quite true and I agree that the re-engagement would mean more disturbances to Radisson’s operations. Radissons will incur reputational risks and possible exposure to legal action. Damage to Radisson’s reputation and business disruptions cannot be quantified.
No permanent injunction sought
(15) In Goundar v Fiesty Ltd[21] Amaratunga JA in the court of Appeal (with whom Chandra and Muthunayagam JJA concurred) held:
“32. The application for injunction needs to be refused in limine, as there is no permanent injunctive relief sought in the claim. The only claim is for damages for trespass and negligence against the 1s 2nd Defendants respectively. In American Cyanamid Co v Ethicon Ltd [1975] UKHL 1; [1975] 1 All ER 504 a Lordock held;
“...So unless less the material available to the court at the hearing of the applicationan interlocutory injunction fails to disclose that the plaintiff has any real prospprospect oceedcceeding in his claim for a permanent injunction at the trial, the court should gto considonsider whether the balance of convenience lies inur of granting or refusing the interlocutory relief that isat is sought.
As to that, the governing principle is the court should first considonsider whether if the plaintiff were to succeed at the trial in establishing his right to a permainju injunction he would be ately compecompensated by an award of damages for the loss he would have sustained as a resf the defendant's continuing to do what was sought to be enjoined between the time of the athe application and the time of the trial' (emphasis is mine)
33. How can a Plaintiff seek interlocutory injunctive relief without seeking a permanent injunction is a fundamental issue that had been overlooked in the court below, but this was central to the application for any injunction and since there was no permanent injunction sought this application for interim injunction should have been rejected in limine.”
(Emphasis added)
Upon the perusal of the plaintiff’s statement of claim, it is clear to me that the plaintiff is suing for breach of the Contract and seeks inter alia damages in the sum of $110,000.
There is no claim for permanent mandatory injunctions in the statement of claim.
In the words of Lord Diplock in American Cyanamid (at p. 510), the plaintiff must have a “real prospect of succeeding in his claim for a permanent injunction at the trial” and here the plaintiff seeks no permanent injunction.
Therefore, the application should be dismissed in limine as there are no permanent injunctions sought in the statement of claim. This complication weighs, and in my judgment, weighs quite significantly, against the grant of the interlocutory relief that is sought.
CONCLUSION
Due to the reasons which I have endeavored to explain above, I see no ground on which the court can grant a mandatory injunction to interfere with the rights of the defendant. For the preceding reasons I do not consider that plaintiff has made out a case for interlocutory mandatory injunctions (prayer one and two in the plaintiff’s notice of motion filed on 28-08-2019.) The prayer three is for a prohibitory injunction contingent upon the mandatory injunction prayed for.
Costs
(16) The defendant seeks indemnity costs on the following grounds;
Radisson through its lawyers on 13th September 2019, (annexure DAT 5 of the affidavit in opposition) wrote to the plaintiff’s lawyers outlining the flaws in this application and requesting them to withdraw the application. The plaintiff was put on notice for indemnity costs.
Despite notice of the defects in its application and that damages would be an adequate remedy, the plaintiff insisted that this application be heard which we submit amounts to abuse of process and a waste of the court’s time.
(17) I turn to the applicable law and the judicial thinking in relation to the principles governing “indemnity costs”.
Order 62, rule 37 of the High Court Rules, 1988 empower courts to award indemnity costs at its discretion.
For the sake of completeness, Order 62, rule 37 is reproduced below.
Amount of Indemnity costs (0.62, r.37)
37.- (1) The amount of costs to be allowed shall (subject to rule 18 and to any order of the Court) be in the discretion of the taxing
officer.
The following passage is illuminating;
G.E. Dal Font, on “Law of Costs”, Third Edition, writes at Page 533 and 534;
‘Indemnity’ Basis
“Other than in the High Court, Tasmania and Western Australia, statute or court rules make specific provision for taxation on an indemnity basis. Other than in the Family Law and Queensland rules - which define the 'indemnity basis’ in terms akin to the traditional ‘solicitor and client basis’-the ‘indemnity basis’ is defined in largely common terms to cover all costs incurred by the person in whose favour costs are ordered except to the extent that they are of general law concept of ‘indemnity costs. The power to make such an order in the High Court and Tasmania stems from the general costs discretion vested in superior courts, and in Western Australia can arguably moreover be sourced from a specific statutory provision.
Although all costs ordered as between party and party are, pursuant to the ‘costs indemnity rule ’, indemnity costs in one sense, an order for ‘indemnity costs' or that costs be taxed on an ‘indemnity basis’, is intended to go further. Yet the object in ordering indemnity costs remains compensatory and not penal. References in judgments to a ‘punitive’ costs order in this context must be seen against the backdrop of the reprehensible conduct that often justifies an award of indemnity costs rather than impinging upon the compensatory aim. Accordingly, such an order does not enable a claimant to recover more costs than he or she has incurred.”
I will pause here to consider the principles underlying the exercise of the courts discretion when considering whether or not to award indemnity costs.
The principles by which courts are guided when considering whether or not to award indemnity costs are discussed by Hon. Madam Justice Scutt in “Prasad v Divisional Engineer Northern (No. 02)[22]”,
As to the “General Principles”, Hon. Madam Justice Scutt said this;
Indeed, as was set out in Carvill v HM Inspector of Taxes (Unreported, United Kingdom Special Commissioners of Income Tax, 23 March 2005, Stephen Oliver QC and Edward Sadler) (Bailii: [2005] UKSPCSPC00468, http:/www.bailii.org/cgibin/ markup.cgi?doc=/uk/cases/UKSC/2005/SPC00468.HTML), “reprehensible conduct” requires two separate considerations (at paragraph 11):
“The party’s conduct must be unreasonable, but with the further characteristic that it is unreasonable to an extent or in a manner that it earns some implicit expression of disapproval or some stigma.”
The crucial question is whether the plaintiff’s conduct has reached this threshold? The answer to this question is in the negative. Is it a correct exercise of the court’s discretion to direct the plaintiff to pay costs on an indemnity basis to the defendant for not paying attention to the defendant’s letter (DAT -5) outlining the infirmities in the plaintiff’s application? I venture to say that neither considerations of hardship to the defendant nor the over optimism of the unsuccessful plaintiff would by themselves justify an award beyond party and party costs. In the result, I am constrained to hold that the ground adduced by the defendant does not warrant me to depart from the normal rule and invoke my discretion to award indemnity costs. In my view, the plaintiff has done no more than to exercise its legal rights to apply for an interlocutory relief. This simply does not approach the degree of impropriety that needs to be established to justify indemnity costs. The plaintiff is not guilty of any conduct deserving of condemnation as disgraceful or as an abuse of process of the court and ought not to be penalized by having to pay indemnity costs. There has been no reprehensible conduct by the party liable.
In light of the above, I have no hesitation in holding that an award of indemnity costs is not warranted.
ORDERS
Jude Nanayakkara
Judge
At Lautoka
Friday, 24th January, 2020
[1] [1975] UKHL 1; (1975) (1) ALL.E.R 504
[2] [1972] EWCA Civ 9; (1972) 2 WLR389
[3] per Megarry J in Shepherd Homes Ltd v Sandham, (1971) 1 Ch. P. 348.
[4] [2008] FJCA 36; ABU0063.2007S (4 July 2008)
[5] [1993] F.S.R. 468 at 474
[6] [1977] EWCA 2317 p.11. At p.10-11
[7] [1971] 1 Ch 340 at 351
[8] [1986] 1 WLR 657 at page 664.
[9] [1874] UKLawRpCP 4; (1874) LR 9 CP 208 at 213, [1874 – 80] All ER Rep 750 at 753
[10] (1886) 16 QBD 460 at 474
[11] (1884) 9 App Cas 434 at 438 – 439, [1881-5] All ER Rep 365 at 367-368
[12] (1953) 1 WLR 106 at 116
[13] (1919) 121 LT 628, [1918-19] All ER Rep 963
[14] 121 LT 628 at 633, [1918-19] All ER Rep 963 at 965-966
[15] 121 LT 628 at 635, [1918-19] All ER Rep 963 at 968
[16] [1984] 3 All ER 703
[17] (1971) Ch.340, 351
[18] (1986) 3 All.E.R. 772
[19] [1988] F.S.R. 367. At page 372 Dillon L.J.
[20] [1997] EWCA 2317
[21] [2014] FJCA 20; ABU0001.2013 (5 March 2014)
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