Fiji National Provident Fund v Prasad [2001] FJLawRp 101; [2001] 2 FLR 395 (12 November 2001)

FIJI NATIONAL PROVIDENT FUND v JAGDISH PRASAD
High Court Civil Jurisdiction
31 October, 12 November, 2001 HBA 15/01S

Tort – negligence – whether superannuation fund can be liable in negligence – whether Appellant's negligent advice resulted in nomination being invalid – whether magistrate erred in holding the Respondent had made out his case on the balance of probabilities

Constitutional law – whether the Magistrates' Courts (Civil Jurisdiction) Decree 35/88 has force of law – operation of ss194(1) and 195(1)(e) of the 1997 Constitution – define decrees to be legislative Acts

Civil procedure - whether the Respondent is entitled to commence proceedings in the Magistrates' Court when funds deposited in the High Court – cross appeal on award of further general damages and interest – interest claim not pleaded – whether interest should have been awarded

Fiji National Provident Fund ss34, 35, 43(2); FNPF Regulations regs 51, 53; Magistrates' Courts (Civil Jurisdiction) Decree 35/88; 1997 Constitution. ss194(1) and 195(1)(e)

An account hold holder Vijay Kumar wished to nominate the Respondent under section 34 of the FNPF Act and completed a nomination form which the Respondent then witnessed. Upon Kumar's death, the Appellant advised the nomination was invalid for the Respondent's attestation. The Respondent claimed damages for his loss, owing to negligence advice of the Appellant. The Magistrates' Court found a want of care and awarded him $11,667.59 plus costs. The Appellant appealed on the grounds that the magistrate erred in concluding that Prasad had made out his case on the balance of probabilities. The Court found that the Appellant presented no contradicting evidence thus the ground was dismissed. As the Magistrates' Court was a court of summary jurisdiction, and taking into account the fact that the Respondent was unrepresented, and the Appellant's concession, it properly assessed the Respondent's damages, notwithstanding it was not pleaded. There was no reason why the fund should invoke reg. 51 relating to invalid nominations. The appellate Court found no merit in a cross appeal on award of further general damages and interest.

Held–(1) In this day of growing awareness of the benefits of consumer protection, the Appellant's primary duty is to embers is to advise vise a member that his nomination is invalid either when it accepts it or promptly when the error is discovered to prevent a beneficiary's loss occurring. It is unrealistic to suggest that a large well endowed specialist organisation such as the Appellant has no duty of care to persons with whom its but who are nare not it members.

(2) Notwithstanding that the Appellant had deposited disputed funds into the High Court, a litigant is free to coe proceedings within jurisdictional limits wherever conveninvenient. The Resident Magistrate hadsdiction to entertain thin this action commenced in negligence. Under s43(2) of the Fiji National Provident Fund Act, moneys paid out by the Appellant on tath oember are not part of the deceased's estate and dand do noto not constitute an inheritance.

(3) The Respondent is not entitled to interest, which is not pleaded, and is not entitled to general damages which is not proved, except for funeral expenses, which would ordinarily come out of the fund.

Obiter dictum – the Magistrates' Courts (Civil Jurisdiction) Decree 35/88 is a perfectly valid piece of legislation because the operation of ss194(1) and 195(1)(e) of the 1997 Constitution which define Decrees to be Acts, define written laws to include Acts and continue in force written laws passed before the commencement date of the Constitution. The statement "no Decree can amend an Act of Parliament" is simply incorrect.

The appeal and cross-appeal fail ae dismissed.

Cases referred to in Judgment
Benmax v Austior Corp [1955] 1 Al 1 All ER 326
Hedley Byrne & Co. Ltd v Heller and Partners Ltd [1963] UKHL 4; [1964] AC 465

Haroon Lateef with Ilsaad Razak for the Appellant
Suresh Chandra for the Respondent

12 November, 2001 JUDGMENT

Scott, J
In July 2000 the Respondent herein (Prasad) commenced proceedings in the Suva Magistrates' Court. In hitement of Claim he sthe stated that in June 1999 he and his uncle Vijay Kumar who were both members of the Fiji National Provident Fund (the Fund) went to the Fund's office. Vijay Kumar wishenominate nate Prasad under the provisions of section 34 of the FNPF Act (Cap. 219-the Act) and upon enquiries being made he was asked to complete a nomination fhich Prasad then witnessed.

The fong February VijayVijay Kumar died. When Prasad went to the Fund's Office he was advised that the nomination was invalid.
Regulation 53 of the FNPF RegulRegulations (Cap 219-Subs-the Regulations) provides that:

"Any perso attests the signature of a nominator to a nomination shal shall not be entitled to any benefit thereunder."

Prasad's cas quite simp simple: owing to the negligent advice of the Fund the nomination was invalid. Hadnomination been valid ilid it would have been worth $11,667.59 to him. He sought compensation fs his loss by anby an award of damages.

The Filed a Stat of Deff Defence. It repeated the nome nominnomination was invalid but denied negligence and in particular denied thasad ver advised to wito witness his uncle's signature. From paragraph 5 e statemeatement ment of Defence it appears that the Fund became aware that there was an invalid nomination and attempted to advise Vijay Kumar of this fact but was unsuccessful in doing so tole rectification to occur bcur before his death.

In para 8 of the Statemtatement of Defence the Fund pleaded that on 10 May 2000 the sum of $11,667.59 was paid into the High Court under the provisions of section 35 of the Act (as amended – se 29/86) and that therefore fore the Plaintiff should have applied to the High Court for the release to him of the funds claimed to be standing to his credit.

In paragr of the Statemtatement of Defence the Fund pleaded that no particulars of negligence had been provided by Prasad. On 13 October when the mate matter came fore the Resident Magistrate (Jiten Singh Esq. RM) this pois point was raised by Mr. Razak. On 23 Oc Prasad was ordererdered toish particulars of the negligence upon which he relied.
.

November 2000 10 particarticulars of negligence were filed.; A copy is at pages 20 & 21 of the record of the proceproceedings in the Magistrates' Court. Thticulars are really dint dint ways of making the 3 bas3 basic complaints which Prasad laid before the Resident Magistrate on oath when the matter came on for he on 29 January 2001.

Pra evidence was thas thas that when he and his uncle went to the Fund's office they explained that they each wanted to make a nomination. Vijay Kumar wish to nom Prte Prasad and Prasad wished to nominate his wife. The clerk e office was nams named Tui Fasala and it was he who suggested that they witness each other's nominations. After the wereletedwitnesitnesstnessed they were handed in to and accepted by Tui Fasala. About onet one month latas Prasad went back to the e where it was confirmed to him that he was indeed his uncle's nominee. About 7 monthmonths later his uncle died and he then weck to the office to arrange withdrawal of the funds. 160; He completwithdrawal awal form which was handed in. The followinth the Fuvisedvised him that the nomination was invalid beid because he had witnessed his uncle's signature and therefore the nominafell of regulation 53.n 53. Later Prwent to the High Cigh Court where he was advised that that nothing had been received in his name. He then filed his writ.

In his careful Judgmee the Resident Magistrate first accepted that the Fund owed a duty of care "to ensure that nominations are properly done and ifproperly done to promptly inform the member and the nominee". Hessed the importaportancetance and the special nature of the transaction under consideration and relied on and applied the leading authority b>Hedley Byrne & Co.; Co. Ltd v Heller and Partners Ltd [1963] UKHL 4; [1964] AC 465.

Thident Magistrate then then evaluated Prasad's evidence noting that it was not contradicted by evidence called on behalf of the Fund. He did not overlook tct that Prasad's evidence was not always entirely consistenistent observing for example that Prasad first said that he had read the ntion form but then claimed to have overlooked the warning contained on the form against nomt nominees witnessing nominations. B found that Prasad had esad established on the balance of probabilities that he did indeed sign the nomination form at the sugge of the Fund's counter clerk.

In these circumstances the Resident Magistrate cate concluded that as a result of the Fund's want of care Prasad had been led into error and had lost the entitlement which he would have had, had the nomination been val160; He awarded Prasad $11, $11,667.59 plus costs.

The Aant's grounds of a of appeal are set out on pages 3, 4 & 5 of the record. They were amplifi a most cost comprehensive written submission filed by Mr. Razak. Mr. Chandra filed a helpful written submissionssion in answer.

Mr. Razak took the firgt 3 grounds together. He highld each of the weae weaes in Prasad's evidence and suggested that the Resident Magistrate erred in concluding that that Prasad had made out his case on the ce ofabilities. 160; This is always ficulticult ground of d of appeal to argue successfully since it is well settled that in the absence of misdirection an appeal Court will seldom reverse findings of fact reached at first instance (see e.g. Benmax v Austin Motor Corp [1955] 1 All ER 326). Mr. Razak pointed out that the evidence of Prasad was not corroborated but as a general rule there is no requirement for corroboration. In the present chere o evio evidence to contradict the Plaintiff. These grounds fail Inbr>In ground 4 it was argued that the ResiMagistrate was wrong to hold that the Fund had a duty to advise Prasad that the nomination tion was invalid. In ground 5 it wased the Fund owed no duno duty of care to Prasad. While I ae I agree that une Fund's primary duty is to imbers the circumss umss of this case are such that had the Fund advised Vijay Kumar that his nomination was invalinvalid either when it was accepted or pro whenerror was discovescovered the effect would have been to preo prevent Prasad's loss occurring. Il also be remembered that that Prasad was also a member of the Fnd wished, at the same same time as becoming his uncle's nominee, to nominate his wife.&#16 this era of growing awareness of the benefits of consumer umer protection my view is that it is quite unrealistic to suggest that a large well endowed specialist organisation has no duty of care to persons with whom it deals bu are nare not its members. Desphe several authoritiesities referred to by Mr. Razak I am satisfied that Hedley Byrne was properly applied.The 7th & 8th grounds raised a number of technical objections to the pleadings angs and pointed to the fact that no evidenc placed before the court that $11,667.59 was lost by Prasadrasad. It was also suggested that a nominated person is, by virtue of regulation 51 of the Regulations not entitled as of right to the amount standing to the late member's credit. Takhe eve as a whole and tand the concession contained in para paragraph 8 of the Defence, bearing in mind that Prasad was a litigant inon and that Magistrates' Courts are essentially summary in their nature I do not find that that there was any error in the Resident Magistrate's approach. In rto my question Mr. Raz. Razak was unable to advance any reason at all why the Fund should have invoked regulation 51. These grofail.

The final ground of appeal argued by Mr. Razak was that esident Magistratstrate had no jurisdiction to entertain Prasad's action since it was concewith the validity of an inheritance and was therefore excluded by section 2(1)(i)(iii>(ii) of the Magistrates' Courts (Civil Jurisdiction) Decree 35/88.

In view of ce obiter reer remarks recently made by an acting judge of this court it may be worth pointing out that this Decree in common with many other Decrees is a perfectlid piece of legislation. This cause of the oper oper operation of sections 194 (1) and 195(1)(e) of the 1997 Constitution which define Decrees to be Acts, define written laws to include Acts and continue in force written laws passed before the commencement date of the Constitution. Thtement "no Decree can aman amend an Act of Parliament" is simply incorrect.

Under sect3(2) of the Athe Act moneys paid out by the Fund on the death of a member are not part of the deceased's estate. I am thereforesfied that that the Residenistrate had jurisdiction to entertain this action whic which, it should not be forgotten, was in negligence.

Wimirable dili diligencigence Mr. Razak advanced every possible argument in support of this appeal but I am satisfied that the Resident Magistrate reached the right conclusion. Accordingly the l fails anls and is dismissed.

There was a cross-appeal by Prasad the first limb of which was a claim that the Resident Magistrate should have awarnterest on the sum given to Prasad. tatement of t of Claim didm did not seek interest and accordingl Resident Magt Magistrate was right not to award it.

Thend claim advanced byed by the Respondent was for an award of damages over and above the $1159 awarded. Since Prasad gave no evi once of separatearate loss apart from funeral expenses which would reasonably be expected to come out of the nominated funds I find no merit in this argument. The cross-appeal also fails andismissed.

.

Appeal and cross-appeal dismissed.

Marie Chan