Prasad v Hussein [2012] FJMC 134; Civil Action 486.2009 (20 June 2012)

IN THE RESIDENT MAGISTRATE'S COURT OF FIJI ISLANDS
AT SUVA

Civil Action No 486/2009

BETWEEN

RAKESH PRASAD
PLAINTIFF

AND

MOHAMMED RIAZ HUSSEIN
DEFENDANT

Plaintiff - Mr Narayan E.
Defendant - Mr Khan M.A.

RULING

1. This is the Defendant's application to set aside default judgment.
   
2. The writ of summons was first called on 21.01.2010. Affidavit of service confirms that the Defendant was served with the claim on 27.01.2010.
   
3. The defendant filed his notice to intention to defend on 01.02.2010. On the following day he informed the Court that the proceedings are in progress for a settlement. This was endorsed by the plaintiff.
   
4. On 11.03.2010 both counsels informed that they have actually 99% settled the matter. The learned Magistrate granted 01.04.2012 for the parties to submit their terms of settlement.
   
5. However on 01.04.2010 the matter was called at 9.45 am neither the counsel nor the defendant appeared in Court. When it was called again for the second time at 11.00 am the application by the counsel for the plaintiff was granted for a judgement in default.
   
6. The order was sealed on 12.05.2010. The Defendant has by Notice of Motion dated 07.09.2010 applied to set aside the default judgment and requested leave to file statement of defence.
   
7. The defendant filed his affidavit in support dated 7.09.2010 on 08.09.2010. The response was filed by Sangita Prasad on 26.10.2010. The defendant replied to the said affidavit on 11.07.2011.
   
8. The defendant submits that the default judgement was obtained irregularly on misleading information.
   

Test for Setting Aside a Default Judgment

9. Defaults judgments are categorized in to two groups for the purpose of setting aside.
   
   1. Irregular Default Judgments.
   2. Regular Default Judgements.
      
10. In the case of an irregular judgement, the defendant is entitled to have it set aside ex debito justitiae, and the Court should not impose any terms whatever upon the defendant. On the other hand, the irregularity must be specified in the summons or notice of motion.[Halsbury's Laws of England vol 37 para 403 page 297]
    
11. In the case of a regular judgement, it is an almost inflexible rule that the application must be supported by an affidavit of merits, stating the facts showing that the defendant has a defence on the merits, otherwise there may not be any point in setting it aside.[ Watt v Barnett [1878] UKLawRpKQB 28; (1878) 3 QBD 363,CA]
    
12. The affidavit filed by the defendant claims that after he received a demand notice from the plaintiff dated 04.11.2009; he actually paid $ 4000 to the plaintiff. But the writ of summons does not reflect on this point. Further on the day the plaintiff counsel applied for a default judgment has not raised this issue. The learned magistrate has granted the judgment for the total claim which was $ 20,000. She has not made any queries on the settlement that had been on the table on past two Court dates.
    
13. The affidavit filed in response by Ms Sangita Prasad impliedly confirms the payment of $ 4000 by the defendant.
    
14. A 'Court order' to pay $ 20,000 when the actual claim is $ 16,000, this is the matter before myself now and whether it can be treated as an irregular default judgment.
    
15. At this point I refer to the case of Bolt & Nut.(Tipton) Ltd v Rowlands Nicholls & Co Ltd [ 1964 1 All ER 137] which was decided by Harman and Danckwerts, L.JJ on identical facts.
    
16. The plaintiffs of the Rowlands Nicholls case were in a position to enter judgement in default of appearance in an action against the defendant for goods sold and delivered. The plaintiff accepted a cheque for part of the money claimed. A judgment in default entered without making any allowance for the amount of the cheque.
    

It was held that the defendants were entitled as of right to have the judgement set aside and the plaintiffs were not entitled for a default judgment.

Lord Danckwerts stated,

"the short point in this case is whether the judgment, being singed for the amount for which it was signed, was incorrect and was irregular, so that the defendants were entitled to have it set aside as of right".

17. On the other hand the plaintiff is entitled for a default judgment if the claim is a liquidated demand. [Order 6 Rule 10 of the Magistrate's Court rules]. A liquidated demand is a debt that can be ascertained as a mere matter of arithmetic. It does not extend to un-liquidated damages in contract or tort. Such claim does not become liquidated merely because it is expressed as a definite or specific figure. In this case the parties agreed to sell the business and stock. Although it has a definite amount of $ 20,000 I am of the view it does not cover within the meaning of 'Liquidated claim'. Thus the claim requires formal proof.
    
18. Therefore I conclude that the defendant of this case is entitled ex debito justitiae to have the judgement entered on 01.04.2010 set aside without cost.
    
19. The defendant is allowed to file his statement of defence within 21 days.
    

Yohan Liyanage
Resident Magistrate
20th June 2012