Bluewater Craft Pte Ltd v Coralview Island Resort and Travel Tours Ltd [2021] FJHC 27; HBC284.2020 (18 January 2021)

IN THE HIGH COURT OF FIJI AT SUVA

CIVIL JURISDICTION’

Civil Action No. HBC 284 of 2020

BETWEEN

BLUEWATER CRAFT PTE LIMITED a limited liability company registered

under the laws of Fiji having its registered office at

Lot 3 Naitata Road, Navua

PLAINTIFF

AND

CORALVIEW ISLAND RESORT AND TRAVEL TOURS LIMITED,

a limited liability company registered under the laws of Fiji having

its registered address at Tavewa Island, Nacula, Lautoka.

FIRST DEFENDANT

AND

YALODU ENTERPRISE COMPANY PTE LIMITED a limited liability

company registered under the laws of Fiji having its

registered office at MV Solar (Fiji) Building,

13 Bowalu Street, Lautoka.

SECOND DEFENDANT

AND

MARITIME SAFETY AUTHORITY, a statutory body registered under the

laws of Fiji, a statutory authority having perpetual succession

established pursuant to section 7 of the Maritime

Safety Authority of Fiji Act 2009 and a limited liability

company registered under the laws of Fiji having its

registered office at Kadavu House, 414

Victoria Parade, Suva.

THIRD DEFENDANT

AND

MERCHANT FINANCE PTE LIMITED, a limited liability company

having its registered office at Level 1, Ra Marama House,

91 Gorden Street, Suva

FOURTH DEFENDANT

Counsel : Ms. Ali A. for the Plaintiff

Mr. Jamnadas K. for the 1^st & 2^nd Defendants

Ms. Latianara W. for the 3^rd Defendant

Mr. Tuitoga T. for the 4^th Defendant

Date of Hearing : 10^th December 2020

Date of Ruling : 18^th January 2021

RULING

(On the application for injunction)

[1] The plaintiff filed a writ of summons which was subsequently amended seeking the following orders:

(a) An order that the vessels are the legal property of the plaintiff and they be returned to the plaintiff.
(b) An order that the 2^nd defendant’s name be omitted from the Register of Fiji Ships maintained by the Maritime Safety Authority in terms of section 75(1)(b) of the Ships Registration Act 2013 in respect of the Vessels and replaced with the plaintiff’s name.
(c) An order for payment by the 1^st and 2^nd defendants to the plaintiff $90,000.00.
(d) An order for payment by the 1^st and 2^nd defendants to the plaintiff for the sum of $5000.00 per month from 15^th September 2020 until Vessels are back in the possession of the plaintiff and operational.
(e) Damages for loss of revenue due to the 1^st and 2^nd defendant’ breach of the joint venture between them and the plaintiff.
(f) General damages for breach of contract to return the Vessels to the plaintiff upon failure to pay the purchase price for the same.
(g) General damages for breach of contract and for fraudulent encumbering the Vessels.
(h) An order that the 1^st, 2^nd, and 3^rd defendants indemnify the plaintiff from any and all actions which may arise involving the Vessel “SEABUS 1”.
(i) An order that the 1^st and 2^nd defendants account of all profits from their use of the Vessels from the date of delivery until 15^th March 2019.
(j) Exemplary damages.
(k) Costs on an indemnity basis.
(l) Interest at a rate of 8% from the date of judgment.
(m) Any other orders that this Honourable Court deems just and equitable.

[2] The plaintiff on 30^th November 2020 filed an ex-parte notice of motion pursuant to Order 29 of the High Court Rules 1988, which was converted by the court to an inter-parte notice of motion, seeking the following orders:

1. A declaration that the plaintiff is the legal and beneficial owner of the following motor vessels:
   • (a) MV Tavewa Seabus; and
   • (b) MV Tavewa Seabus 2,

together the “Motor vessels”.

2. An order that the 3^rd defendant henceforth restrain the 2^nd defendant from utilizing or operating the Motor Vessels immediately.
3. An order that the plaintiff may immediately recover and repossess the Motor Vessels and that the 2^nd defendant immediately releases said Motor Vessels to the custody of the plaintiff.
4. An order that 2^nd defendant and/or its servants and/or agents howsoever be restrained from concealing, altering, dismantling, removing, transferring, encumbering, using, disposing of, selling or in any way threatening to diminish the value of the Motor Vessels until further orders of the Honourable Court.
5. An injunction restraining the 2^nd defendant and/or its servants from hindering or interfering in any way with:
   • (a) the plaintiff’s recovery and repossession of the Motor Vessels;
   • (b) the dismantling and removal of the 2^nd defendant’s outboard motors, rigid life raft, life jackets, EPRIB (Emergency Position Radio Indicating Beacon) and Global Positioning System (the “2^nd defendant’s items”) from the Motor Vessels by independent third parties contracted by the plaintiffs at the 2^nd defendant’s cost;
   • (c) the delivery of the 2^nd defendant’s items to its registered address;
   • (d) the plaintiff’s ongoing possession and legal and beneficial ownership of the Motor Vessels;
6. An order that the 2^nd defendant’s name be omitted from the Register of Fiji Ships maintained by the Maritime Safety Authority in terms of section 75(1)(b) of the Ships Registration Act 2013.
7. An order that the plaintiff be at liberty to engage and enlist the services of Police and/or Bailiffs in the execution of these orders.
8. Costs of this action on an indemnity basis.
9. Such other relief as the court deems just.

[3] The plaintiff is in the business of boat building. The plaintiff and the defendant discussed about having a partnership or a joint venture however, there is not written agreement. According to the plaintiff the 1^st defendant agreed to contribute FJD60,000.00 for a 10% shareholding, the plaintiff’s Director, Apostolos Christos Tsantikos would personally hold a 10% shareholding and the plaintiff would own 80% as all costs of construction was to be borne by the plaintiff.

[4] At the time of the delivery of SEABUS 1 to the 1^st defendant, the latter had paid FJD45,000.00 out of agreed FJD60,000.00 and later 1he 1^st and 2^nd defendants had paid FJD20,000.00.

[5] The plaintiff built SEABUS 2 and the 1^st defendant had contributed FJD2000.00 for the construction. SEABUS 2 was launched in June 2017 and the 2^nd defendant started it operation.

[6] The joint venture failed and the plaintiff and the agreed to sell the Vessels, however, there is no written sale and purchase agreement. The only document tendered in evidence is “Heads of Agreement” which not an agreement enforceable in law.

[7] I will now proceed to consider the application for injunctions of the plaintiff.

[8] In American Cyanamid Co. v Ethicon Ltd [1975] UKHL 1; [1975] 2 W.L.R. 316, [1975] A.C. 396, Lord Diplock set down certain guidelines for the courts to consider in granting or refusing an application for interim injunction. They are as follows:

(i) Whether there is a serious question to be tried at the hearing of the substantive matter;
(ii) Whether the party seeking an injunction will suffer irreparable harm if the injunction is denied, that is whether he could be adequately compensated by an award of damages as a result of the defendant continuing to do what was sought to be enjoined; and
(iii) In whose favour the balance of convenience lie if the injunction is granted or refused.

[9] It is also important to bear in mind that injunction is an equitable remedy granted at the discretion of the court. The power which the court possesses to grant injunctions should be cautiously exercised only on clear and satisfactory grounds. An application for injunction is an appeal to an extraordinary power of the court and the applicant is bound to make out a case showing clearly a necessity of its exercise.

[10] Order 1 sought in the notice of motion is not an injunctive relief but a declaration of the ownership which cannot be granted in an interlocutory application of this kind. The title of these vessels are not registered in the name of the plaintiff nor is in the name of the defendants. Therefore, it is an issue that the court has to decide in the substantive matter and that is the first order the plaintiff has sought in its amended statement of claim. It is also important to note that the defendants also have contributed to the cost of the construction of these two Vessels.

[11] Order 3 sought in the Motion is for the plaintiff to recover Vessels immediately. Since the question of ownership is yet to be decided that order cannot be granted as an interim relief.

[12] In Hubbard & Another v Vosper & Another [ 1972] 2 Q.B. 84 Lord Denning 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 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. .... 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.

[13] The main purpose of granting an interlocutory injunction is to maintain the status quo that is to prevent a party from doing anything that would render the final judgment nugatory.

[14] In this instance the defendants have been operating these two Vessels for four years since the dispute between them and the plaintiff arose but the plaintiff did not take any action against the defendants to recover the Vessels instead he continued to receive money from them.

[15] Order 4 sought in the Motion is to restrain the defendants from concealing, altering, dismantling, removing, transferring, encumbering, using, disposing of, selling or in any way threatening to diminish the value of the Motor Vessels until further orders of the court.

[16] There is no material before this court to show that the defendant was at least making arrangements to do to any of those acts. One cannot seek an injunctive order based on assumptions. In the affidavit in support it is averred that the 2^nd defendant operates SEABUS 1 in breach of mandated maximum number of passengers but no injunction has been sought to restrain the 2^nd defendant from acting contrary to the regulations.

[17] The only injunctive relief is the order 5 sought in the Motion. There is no purpose of granting that order since the court has decided above to refuse the orders 1 and 3 sought in the Motion.

[18] The orders 2 and 6 in the Motion are sought against the 3^rd defendant. The 3^rd defendant is an independent statutory authority apart from registering the Vessels it has no interest in the dispute between the plaintiff and the 1^st and 2^nd defendants.

[19] Section 75(1)(d) provides that an entry incorrectly exists in the register a person aggrieved or the Registrar may apply to the High Court for rectification of the Register.

[20] In this matter the plaintiff waited for about four years to raise this issue and also the plaintiff does not say the registration done without its consent or it objected to the registration. From the material available it is clear that the registration was done with the consent of the plaintiff.

[21] In the case of In re Ownership of MV Endeavour [1997] FJHC 166; HBG0004d.1997s (4 November 1997) it was held:

What's more even if I accept that an 'order for rication' may be graby the Court, suc, such a remedy is undoubtedly in the nature of equitable relief and may be withheld at the discretion of ourt ding to general equitable principles including thng the doctrine of 'laches and and acquiescence'; prejudice to innocent third parties; and absence of clean hands to name but a few.

[22] In this matter the plaintiff is guilty of both s and acquiescence.

[23] For the reasons aforementioentioned the court makes the following orders.

ORDERS

1. The Notice of Motion filed on 30^th September 2020 is struck out and the orders sought are refused.
2. The court will not make order as to costs of this application.
   

Lyone Seneviratne

JUDGE

18^th January 2021