Jivaratnam v Prasad [2023] FJSC 11; CBV0005.2020 (28 April 2023)

IN THE SUPREME COURT OF FIJI
[APPELLATE JURISDICTION]

CIVIL PETITION NO: CBV0005 of 2020
Court of Appeal No. ABU 116 of 2016

BETWEEN:

ARON ADARSH JIVARATNAM and PREMINA SINGH
(both of Suva, Fiji, both School Teachers)
Petitioners

AND:

GAYA PRASAD
Respondent

Coram : Hon. Mr. Justice Anthony Gates, Judge of the Supreme Court
Hon. Mr. Justice Brian Keith, Judge of the Supreme Court
Hon. Mr. Justice Filimone Jitoko, Judge of the Supreme Court

Counsel: Mr. Shelvin Singh for the Petitioners

Mr. Vishneel Kumar for the Respondent

Date of Hearing: 5 April 2023
Date of Judgment : 28 April 2023

JUDGMENT

Gates, J

[1] I agree with Jitoko J’s judgment, its reasons and orders.

Keith, J

[2] I have read in draft Jitoko J’s judgment. I agree with it and with the orders which he proposes. There is nothing which I can usefully add.

Jitoko, J

[3] This is an application for special leave to the Supreme Court from the decision of the Court of Appeal of 28 February, 2020. The application is made pursuant to Section 98 (4) of the Constitution and Section 7 (3) of the Supreme Court Act 1998.

Background

[4] The Petitioners had entered into a Sale and Purchase agreement with the Respondent on 22 April 2014 for the Petitioners to purchase from the Respondent the property comprised in CT8413, Lot 3 on DP1995 for the consideration of three hundred and sixty thousand dollars (($360,000). Transfer was signed by the Respondent as transferor on 25 April 2014, stamp duties duly paid by the Petitioners on 6 June 2014, a copy of the stamped Transfer was sent to the Respondent’s solicitors on 9 June 2014 for the purpose of obtaining the necessary Capital Gains Tax Clearance Certificate to finalize the transaction. No deposit of the purchase price was paid and the expectation was the full sum was to be paid by the Petitioners within 60 days of the Date of the Settlement.

[5] As evident from the facts on the record, the settlement date did not arrive as the Respondent was away abroad for medical reason. The exchange between the parties’ solicitors continued for a few months more and it was beginning to appear, to the Petitioners at any rate, that the Respondent was having second thoughts proceeding with the sale.

[6] The Petitioners, after waiting for four (4) months from the date of the signing of the Transfer by the Respondent, filed summons for specific performance of the sale agreement on 15 August 2014. In view of the Respondent’s absence from the jurisdiction, the Petitioners applied and were granted substituted service on 26 March, 2015. Affidavit of Service was filed on 1 June 2015.

[7] On 22 July, 2015 the Petitioners by ex-parte motion, applied and were granted on 27 July, 2015 default judgment by the Acting Master.

[8] On 23 September 2015, the Petitioners filed Summons for Further Directions, pleading that the Court, in view of the reluctance of the Respondent to settle, authorize the Chief Registrar to obtain the Capital Gains Tax Clearance Certificate, and further authorize the issue of a new duplicate CT.

[9] On 8 April 2016 the Respondents, through their new solicitors, filed a motion to set aside the default judgment of 22 July, 2015 on the grounds, inter alia, that the ‘Writ with the Statement of Claim was not served on them. The motion to set aside was heard by the Master, together with the Petitioner’s Summons for Further Directions. On 19 July 2016 the Master dismissed the motion, while allowing the Petitioners’ application for Further Directions.

[10] The Respondent on 1 August 2016, pursuant to Order 59 Rule 8 (2) and 11 of the High Court Rules, sought leave to appeal the decision of the Master of 19 July, 2016 and at the same time a stay of the Ruling until the determination of the appeal.

[11] The summons for leave to appeal to the High Court for the Master’s Ruling was heard before A.L.B. Brito-Mutunayagam J on 14 September 2016. On 14 October, the Court refused leave to appeal.

[12] The Respondents immediately filed on 24 October their Notice of Appeal to the Court of Appeal.

[13] The Court of Appeal heard the Respondent appeal on 5 February, 2020. In its judgment of 28 February, 2020, the Court of Appeal ordered that:

“1. Appeal allowed.

2. 2. Decision of the learned High Court Judge dated 14 October 2016 and the decision of the learned Master dated 19 July 2016, are set aside.
3. The Plaintiff/Respondent to pay $5,000 costs to the Defendant/Appellant.”

Appeal to the Supreme Court

[14] On 3 March, 2020 the Petitioners filed their Petition for Special Leave to Appeal to the Supreme Court under section 98(3) (b) and 98 (4) of the Constitution.

Grounds of Appeal

[15] The Petitioner sets out 15 grounds of appeal as follows;

+

“(a) That the Court of Appeal erred in Law in holding that the decision of the Master dated 19 July 2016 and the decision of the learned Judge of the High Court delivered on 14 October 2016 were final decisions and ignored the fact that the decision of the Judge dated 14 October 2016 was a n application for leave to appeal from the decision of the learned Master where the Judge had declined leave to appeal to the Judge under Order 59 rule 8 (2) of the High Court Rules 1988.

(b) Alternatively, if the decision of the Judge dated 14 October 2016 where he refused leave to appeal from the Master’s decision of 19 July 2016 where the learned Master dismissed the setting application of the Respondent and granted further Orders were final Orders, which are denied, then the Fiji Court of Appeal erred in law in not holding that there was no appeal before it as the Respondent did not comply with Order 59 rules 8(1) and Order 59 rule 9 (a) of the High Court rules.

(c) That the Court of Appeal erred in law in misinterpreting the judicial precedent set down in Goundar v. Minister of Health [2008] FJCA 40; ABU 0075.2006S (9 July 2008) which held that some decisions may be interlocutory even though they have the practical effect of finally determining the rights of the parties.

(d) That the Court of Appeal erred in law in holding that the settlement could not be reached due to fault of both parties by wrongly implying that there was deposit requirement under the Sale and Purchase Agreement dated 22 April 2014 when the said agreement was clear in that no deposit was payable as a special condition to the agreement and that all the funds were to be paid on settlement.

(e) That the Court of Appeal erred in Law and in fact in holding the Respondent/Defendant signed the said Sale and Purchase agreement with the expectation of receiving a deposit when the evidence in the form of email communications between the parties did not disclose any request or demand for a deposit payment to the Respondent.

(f) That the Court of Appeal erred in law and in fact in relying on an affidavit of the Respondent Gaya Prasad where he falsely represented that:

“13. THAT since I was uneducated I had full and utter complete faith in my Solicitors at that time Reddy Nandan Lawyers.

14. THAT I was informed by my Solicitor that the period for the Sale and Purchase agreement is of 60 days and upon signing of the agreement I would be paid a deposit of 10% of the sale price which is FJD$36,000 (thirty six thousand dollars as this was customary.
15. THAT pursuant to that I was also advised to sign the Transfer document dated 25^th April 2014. Annexed is a copy of the said Transfer marked as annexure “GPC 4” for your reference.
16. THAT upon signing of the same I neither received any monies nor did my Solicitor at that time”

The assertions made by the Respondent were not supported in any communications by his solicitors during the time the parties communicated to exchange the Transfer and to attend to all conditions required in order to settle the sale of the Respondent’s property and the Fiji Court of Appeal has erred in law in holding that these self-serving assertions which are in breach of the Parol evidence rule should have been considered by the learned Master and the Learned Judge of the High Court.

(g) That the Fiji Court of Appeal erred in law and in fact in holding that the Petitioners did not comply with the said agreement by paying the full sum of $360,000 within 60 days time i.e. by 22 June 2014 and ignored the General Conditions of the agreement that settlement was to be held at the Registrar of Titles Office within 60 days time period where if the Respondent was ready to settle, he would have been paid the $360,000 in exchange for the stamped Transfer, the duplicate Original Title and vacant possession of the property.

(h) That the Fiji Court of Appeal erred in law and in fact in holding that the Petitioners were in breach of agreement by not paying a deposit and by not making the full payment of $360,000 in 60 days time and ignored the legal requirement for a Capital Gains Tax clearance certificate to have been obtained by the Respondent/Vendor prior to any payment being released to him at settlement.

(i) That the Fiji Court of Appeal erred in law and in fact in holding that the Petitioners should have paid a deposit to the Respondent when the agreement did not require a deposit payment and stated in clear terms that the full sum was payable at the time of settlement.

(j) That the Fiji Court of Appeal erred in law and in fact holding that the Petitioners were required to pay the full sum of $360,000 to the Respondent in 60 days time without the Vendor complying with the Capital Gains Tax Decree (2011) which has since been replaced by the Income Tax Act 2015.

(k) That the Fiji Court of Appeal erred in law and in fact in the Master should not have issued an Order for specific performance when there were no breaches by the Petitioners and the Respondent did not complete his obligation under the said agreement to obtain a Capital Gains Tax clearance certificate and was not ready, willing and able to settle the transaction agreed in the Sale and Purchase agreement dated 22 April 2014.

(l) That the Fiji Court of Appeal erred in law and in fact in holding that the specific performance Order by the Master of the High Court was erroneous as the Fiji Court of Appeal was dealing with an appeal over the refusal by the Judge to grant leave to appeal to him from the interlocutory decision of the Master on why he was incorrect in not setting aside the Judgment by Default against the Respondent. In the circumstances, the Fiji Court of Appeal wrongly determined the whole action when it should only have dealt with the Appeal before it.

(m) That the Fiji Court of Appeal erred in law and in fact in commenting on the validity of service of the Writ of Summons when the documents were served on the Respondent by the modes authorized by the Court order and the Petitioners relied on documents extracted from the Registrar of Titles Office [paragraph 22 (2) to show that this was the address for service provided by the Respondent which is where the service of the Writ of Summons was done.

(n) The Fiji Court of Appeal erred in law and in fat in awarding costs of $5,000 against the Appellant.

(o) That the Court of Appeal’s decision is unfair and unreasonable when taking into account all the circumstances of the case.

[16] In addition, the Petitioners submits that the Court of Appeal decision raises major issues of law as follows:

1. “.......requires full sums payable under land sale contracts to be paid to the Vendors without there being a settlement at the Registrar of Titles Office. Not only does the decision ignore the fact the Income Tax Act 2015 (previously the Capital Gains Tax decree 2011) requires a Capital Gains Tax clearance certificate to be obtained by a Vendor, it has the effect that a Purchaser will be in breach of the land sales contract if the full payment is not made within the time period regardless of whether there are any encumbrances on the title or not.
2. “.......a deposit is now required to be paid even when the parties who are presumed in law to have the freedom to contract stipulate clearly that no deposit is payable under the agreement. The larger effect of this finding by the Fiji Court of Appeal is that parties who have signed a ‘nil deposit clause’ can easily terminate the sale agreement by insisting for an inference that a deposit is to be payable.
3. “.......establishes new legal authority that assertions of the nature raised in paragraph 2 (f) of the Grounds of Appeal should be considered by the Master or the Honourable Judge of the High Court even when the assertion is falsely raised to avoid a Sale agreement and even where there is no evidence to support the assertion either within the Sale contract or the communications exchanged between the parties respective solicitors during the time allowed under the sale agreement.
4. “.......it establishes new legal authority that the Fiji Court of Appeal can now determine the full rights and obligations of the parties even when those rights or obligations are not in the Appeal before it. In the present matter, the Fiji Court of Appeal had an appeal before it where it was to decide the Notice of Appeal before it and not the substantive rights of parties which were not matters of controversy before it.
5. “.......raised doubt on the way in which an Order of the Court may be termed ‘interlocutory” or “final” and guidance of the Supreme Court of Fiji is now needed to clear this controversy. In the present matter, the Respondent had made an application for leave to the Judge of the High Court to appeal as is required under Order 59 Rule 8 of the High Court Rules. By this, there was an acceptance on part of the Respondent that he was appealing an interlocutory order. The Fiji Court of Appeal using the ‘application’ approach has held that that the Order being appealed was a final Order and no leave to appeal was required under section 12 (2) (f) of the Court of Appeal Act.
   

[17] Finally, the Petitioner contends that the subject matter of this appeal raises substantial general interest in the administration of the country’s legal system.

[18] I have set out the Petitioners’ grounds of appeal in full, even although there may be overlapping and repetitive issues, only because they show very clearly both questions of law and facts that need to be addressed. The Court where the grounds converge, will address them together.

Special Leave under Section 7 of the Supreme Court Act

[19] The Court’s jurisdiction is founded under Section 98 of the Constitution and in determining whether to grant leave to appeal, it must be satisfied that the threshold requirements of section 7(3) of the Supreme Court Act are satisfied, to whit, the case raises:

“(a) a far-reaching question of law;

(b) a matter of great general or public importance;

(c) a matter that is otherwise of substantial general interest to the administration of civil justice.”

[20] In this particular application for leave to appeal, there is no doubt that the issue such as to whether a judgment or order in the courts below is interlocutory or final, and upon which an appeal stands or falls, is very important and raises “a far-reaching question of law”. This, as well the general rules on conveyancing practices are equally matters of substantial general interest ot the administration of civil justice in Fiji

Whether the Substituted Service Was Valid and Effected

[21] The Petitioners’ grounds of appeal (m) and (o) relate to this issue.

[22] While the Court of Appeal did not make an issue on the validity of the Order of the Acting Master of 26 February, 2015 for substituted service of the Writ, Counsel for the Respondent did refer in his submission to the provisions under Order 13 r 6 and Order 19 r 7 which required mandatory service on the Respondent.

[23] It is enough in the Courts view in response to Counsel’s submission to bear in mind the proviso to the requirement of personal service of documents as set out under Order 65 R 1(1) and (2) and specifically O 65 R 4 on substituted service which states:

“Substituted service (O65 R4)

(1) If, in the case of any document which by virtue of any provision of these Rules is required to be served personally or document to which Order 10 Rule 1 applies, it appears to the court that it is impracticable for any reason to serve the document in the manner prescribed on that person, the Court may make an order for substituted service of that document.

(2) An order for substituted service may be made by an affidavit stating the facts on which the application is founded.

(3) Substituted service of a document in relation to which an order is made under this Rule is effected by taking such steps as the Court may direct to bring the document to the notice of the person to be served.”

[24] The difficulties in personal service outlined in the affidavit in support of personal service were enough to satisfy the Court to agree to the Petitioners’ application. This Court agrees with the finding of the Brito-Mutunayagam J that the Writ of Summons was served on the Respondent. The fact that the public notice of service was published in another daily newspaper (Fiji Sun) instead of the “Fiji Times” is not fatal to the validity of the service.

Master’s Orders Sought to be Impugned

[25] There are two (2) Orders and made at different times by the Master that are relevant to the appeal.

[26] The first Order was made by the Acting Master on 13 August 2015 pursuant to the Petitioners ex parte motion of 22 July 2015, seeking, consequent on the default of the Respondent to acknowledge service of the Writ and filing of defence:

“(a) judgment or an order for such relief as upon paragraphs (a) (c) and (e) of the Plaintiffs’ Statement of Claim hereto; and

(b) Costs of this application be paid by the Defendant.”

[27] The application was made under Order 13 (Failure to give Notice of Intention to Defend) and Order 19 (Default of Pleadings).

[28] The Orders were:

“(a) Specific Performance of a written agreement between the Plaintiffs and the Defendant made on the 22 April 2014 for the Sale by the Defendant to the Plaintiffs of the Defendant’s freehold property comprised and described in Certificate of Title No. 8413 being Lot 3 on DP No. 1995.

(b) Further or alternative damages for breach of contract.

(c) Costs and incidental to this action.”

[29] The second Orders by the Master were made in his Ruling of 19 July, 2016 which dealt with:

(a) the Respondent’s Motion filed on 8 April 2016 seeking the Order of 27 July 2015 be set aside and/or stayed and

(b) the Petitioners’ Summons for Further Directions filed on 23 September 2015.

[30] The Orders were:

“(i) the Defendant’s application seeking an order to set aside the Orders of 27 July 2015 is hereby dismissed.

(ii) The Plaintiffs’ Summons filed 23 September 2015 seeking further directions is hereby grated in items of prayers Nos. 1 to 7 inclusive.

(iii) The Defendant must comply with all the directions therein within the next 21 days to allow for the property transfer to be effected without any hindrance and obstruction.”

[31] The costs against the defendant was assessed at $750.00.

[32] It is important to note that in the subsequent applications and Summons for Leave to appeal by the Respondent to the High Court as well as deliberations in both the High Court and the Court of Appeal, it is the latter of the Master’s Orders of 19 July, 2016, inter alia dismissed the Respondent’s application to have the Order or Specific Performance set aside, that was identified to be impugned, even though it is the Master’s Order for Specific Performance made on 27 July 2015 that is the appropriate Order. Be that as it may, given that both the parties Counsel as well in the Court have focused their arguments on the Order of Specific Performance, I am willing to accept that it is the Master’s 27 July 2015 Order which the Respondent had sought and is seeking to be impugned.

Whether the Master’s Orders and the High Court Orders were Final or Interlocutory

[33] The first grounds (a – c) of appeal are premised on the submission by the Petitioners that the Orders of the Master and the High Court were interlocutory, not final Orders, as found by the Court of Appeal.

[34] Specifically, the Master’s Orders sought to be impugned were made on 19 July, 2016 which inter alia stated:

(i) that his earlier Orders of 25 July, 2015 for specific performance be set aside, and

(ii) that the Petitioners’ Summons for further directions granted.

[35] The High Court Orders of 14 October, 2016 followed the Respondent’s application for leave to appeal the Masters Orders, which application was denied.

[36] High Court rules set out very clearly the process of appeal from any decision from the Master. Order 59 r.8 governs the appeal as follows;

“8. (1) An appeal shall lie from a final Order or Judgment of the Master to a single Judge of the High Court.

(2) No appeal shall lie from an interlocutory Order or Judgment of the Master to a single Judge of the High Court without the leave of a single Judge of the High Court which may be granted or refused upon the papers filed.

Order 59 r.9 set out the period of appeal and service in both cases of interlocutory and final Orders or Judgments and extension of time and form of appeal under r.10 and r.11.

[37] A useful analysis of the approach to be taken by the Court in deciding whether an Order is interlocutory or final is to be found in Kumar J’s Ruling in Mohammed Wahid Khan v Mohammed Yasad Ali CA No. HBC 21 of 2013, in which he canvassed the Fiji case law as well as English precedents.

[38] In Suresh Charan v S. M. Shah & Ors (1995) 41 FLR65, the Fiji Court of Appeal expressed its opinion on whether the matter before it, the refusal of the High Court to grant leave for judicial review, was an interlocutory order or a final order. Unlike the position in England where under its amended Order 59 r.1A of October 1988, the Orders are identified as interlocutory or final. Fiji Courts may continue to rely on the task of “identification by reference to the general principles underlying the common law.” Under it, the English Courts found two possible alternative approaches namely the “order approach” and the “application approach.” The Court went on to say, at p.67:

“The “order approach” required the classification of an order as interlocutory or final by reference to its effect. If it brought the proceedings to an end, it was a final order, if it did not, it was an interlocutory order. The “application approach” looked to the application rather than the order actually made as giving identity to the order. The order was treated as final only if the entire cause or matter would be finally determined whichever way the Court decided the application.”

[39] The Court in the Suresh Charan case noted that whilst the Fiji Courts are not bound by the decisions of the English Courts, it is generally useful to follow the English Courts decisions for the orderly development of the law in Fiji, unless there are strong reasons for not doing so. The Court decided in Suresh Charan case, to adopt the “application approach” and that the refusal of the High Court to grant leave for judicial review was an interlocutory order, and the applicants required leave to appeal against it.

[40] This Court notes the Court of Appeal in subsequent cases have favoured “the order approach” as in Jetpatcher Works (Fiji) Ltd v. The Permanent Secretary for Works & Energy & Ors [2004] Vol 1 Fiji CA213 or ambivalent as in Woodstock Homes (Fiji) Ltd v Rajesh [2008] FJCA 104 or went back to the “application approach” as in Goundar v Minister for Health [2008] FJCA 40.

[41] In the absence of any statutory assistance to aid the courts in Fiji, this Court is of the view that the “application approach” should be adopted unless there are strong reasons in any particular case for not doing so. As a general guide and rule of thumb, when and where there is doubt if the Order is final or interlocutory, leave should be sought.

[42] Using the “application approach”, I am persuaded by the conclusion of the Court of Appeal that the Master’s Orders of 27 July 2015 for Specific Performance under the Agreement for Sale and Purchase and as well as the subsequent Order of 19 July 2016 dismissing the Respondent’s Motion to set aside the earlier Order, were final Orders. There was therefore no requirement for leave to appeal.

[43] On the other hand, the High Court Judge’s Orders of 14 October, 2016 in which leave to appeal the Master’s Orders were refused, are interlocutory. In any case, the Respondent had correctly filed his application for leave to appeal under O 59 r 7 (2). I am equally of the view that the requirements of leave have been met.

The Sale and Purchase Agreement

[44] There is no dispute by the parties that the Agreement signed by both and stamped, was a valid legal agreement outlining in its provisions, the conditions, obligations, rights and remedies available to either of the parties. There is no dispute that the purchase price was $360,000 and that under Clause “ Payment of balance” it stated: “ The sum of $360,000 shall be paid within 60 days of this Agreement (“the Date of Settlement”) subject to the terms of this agreement. The Respondent as the Vendor, was to give up possession of the property to the Petitioner, as the Purchaser on the Date of Settlement. Clause 7 details the Vendor’s Warranties and undertakings and recourse of either parties if the sale is not settled at the Date of Settlement. Clause 9.3 recognizes the rights that the Vendor may exercise if the Purchaser does not comply with the terms of the agreement and similarly at Clause 9.4 the Purchaser’s recourse should the Vendor not comply with the terms of the Agreement.

[45] The Date of Settlement recognized under Fiji’s conveyancing practice and where it involves the bank and mortgage transactions, is, as submitted by the Counsel for the Petitioner and not disputed by the Respondent, where “all parties meet at the Titles Office to “settle” by checking that all utilities affecting the property are cleared, the Vendor has the keys and title to the property and in exchange for lodgment of the Transfer at the Registrar of Titles counter, the Vendor is paid the price agreed on the Transfer.” This process is also clearly detailed at Clause 3 of the Agreement.

Whether the Payment of a Deposit Was Required

[46] The Petitioners’ grounds of appeal d, c, f, g, h, i are relevant to this issue.

[47] Under the Principal Terms of the Sale and Purchase Agreement the Clause on Deposit states “Nil” whereas under the General Conditions of the Agreement clause 1.3 stipulates that “The deposit shall be paid on signing of the agreement.” The Court of Appeal, was of the view that Clause 1.3 of the Agreement is a mandatory requirement, disagreeing with the judgment of the Court below which found that there was “no requirement for a deposit to be made.”

[48] The Court of Appeal found, given that no deposit had been paid at the signing of Agreement that the Petitioners had failed to comply with the terms of the Agreement. In its view, the payment of the deposit was a condition precedent and the ex parte motion by the Petitioner granted by the Master, for Specific Performance, without the Master paying due regards to the non-performance by the Petitioner, was in its view, wrong.

[49] In the result of its finding above, the Court of Appeal set aside the Master’s Order of 19 July 2016 and also the subsequent High Court Order of Brito-Mutunayagam J, of 19 July 2016 refusing leave to appeal the Master’s decision. In the High Court’s view, the terms of the Agreement on the issue of the deposit is clear. The Principal Terms stipulates that the Deposit requirement is “Nil”. The Court of Appeal however, relied and Clause 1.3 of the General Conditions which states: “The deposit shall be paid on signing of this agreement.” In its view, the obligation under Clause 1.3, for the Purchaser to pay a deposit at the signing of the Agreement, was “unequivocal”.

[50] This Court respectfully disagrees with the Court of Appeal’s interpretation and conclusion of the provision of the Agreement. The Principal Terms of the Agreement are the primary provisions and subsequent provisions including the General Conditions are subject to the former. This means that Clause 1 of the General Conditions of the Agreement on Deposit, is subject to, or qualified by the Principal Terms Clause on Payment of balance which states:

“The sum of $360,000.00 shall be paid within 60 days of this Agreement (“the Date of Settlement”) subject to the terms of this agreement.”

Since there was “Nil” requirement for payment of deposit, the requirement of the “payment of balance” Clause still reflected the payment of the full purchase price of $360,000.00 within 60 days of Agreement.

[51] Upon the proper construction of the contract between the Vendor and the Purchaser under this Agreement for Sale and Purchase, this Court finds that there was no requirement for the Petitioner as the Purchaser, to pay a deposit before the Date of Settlement.

[52] As a general observation on the law, and in particular conveyancing practice, the payment of a deposit in any agreement including the sales of land, is not a mandatory requirement. The parties are at liberty to decide whether the Purchaser should pay a deposit as a measure of good will and is refundable upon settlement, or deposit as part-payment of the purchase price.

Time of Essence

[53] Clause 10.1 stipulates clearly that: “Time is of the essence of the Agreement....” In law of contract the term indicates that the parties to an agreement must fulfill all their obligations under it by a specific date or time to which they have agreed. Delay or failure to perform by the time, may amount to a breach of contract resulting in actions for damages or specific performance.

[54] Even in the absence of time of performance in an agreement, the principle of common law is that:

“in the absence of a contrary intention, time is essential, even though it has not been expressly made by the parties. Performance must be completed upon the precise date specified, otherwise an action lies for breach.” (Cheshire & Fifoot. foot: Law of Contract-3^rd Australian Ed. Pp665 – 666)

[55] In this case the time, the Date of Settlement, by which both the Respondent as the Vendor and the Petitioner, as the Purchaser were required to fulfill their obligations under the Agreement was 60 days from the 22 April 2014. This was to be the Date of Settlement.

[56] It would seem rather foolhardy, in the Court’s view, that the Respondent now argues, given all that he has not done or failed to do, that the term “time is of the essence” and its application, is in his favour.

Whether the Petitioners as Purchasers Were Entitled to Specific Performance

[57] The Petitioners’ grounds of appeal (k) and (l) are based on the submission that they were entitled to Specific Performance, contrary to the findings of the Court of Appeal.

[58] From all the evidence produced in both the High Court and the Court of Appeal, it is clear that the Petitioners had performed all that were required of them under the Agreement. They had;

(i) signed the Transfer,
(ii) sent a copy of the Stamped Transfer to the Respondent’s solicitors
(iii) requested that the Respondent seek the recession Capital Gains Tax Clearance Certified (CGTC) from the authorities to enable the parties to prepare and proceed to the Date of Settlement.
(iv) sent through the Respondent’s solicitors, two (2) reminders and follow ups seeking urgent action by the Respondent to obtain the necessary (GTC) for settlement.

[59] In addition, the Petitioners through their Solicitors, in seeking Further Directions from the Court, sought to facilitate the completion of the transaction by applying for an Order that the Respondent make the application for CGTC to the authorities and the Registrar of Titles issue a duplicate CT for the land in question.

[60] In the Court’s view, the Petitioners had performed all they were required to do under the Agreement for Sale and Purchase. The Court furthermore, also notes that they had not received any notice of non-compliance from the Respondent as Vendor, under Clause 9 of the same.

[61] The failure by the Respondent to perform his obligations in the Agreement and specifically as required under Clause 2 thereof, and the Warranties and undertakings in Clause 7, amounts to fundamental breaches of the contract. The Petitioners as Purchasers are therefore entitled to remedies including inter alia, specific performance, under Clause 9.4 of the Agreement.

[62] Important issues of law, the Petitioner submits at paragraph [16] on the procedures and legal requirements that would be affected if the Court of Appeal decision stood, have been answered in the course of this judgment.

Conclusion

[63] In the Court’s view, the Petitioners and the Respondent as Purchasers and Vendor had every intention of proceeding to the completion of the transaction for the sale of CT 8431, Lot 3 DP1995, within the time frame of 60 days as set out in the Agreement for Sale and Purchase of 22 April 2014. This view is supported by the Respondent signing the Transfer document 3 days later on 25 April 2014. The Transfer was duly stamped on 6 June 2014 and a copy sent to the solicitors on 9 June 2014 for the Respondent to facilitate his obtaining the necessary CGTC for the full settlement of the transaction. All of these actions by the Petitioners through their solicitors, were still within the 60 days settlement period.

[64] Thereafter, and notwithstanding the urgency of the communication through emails and telephones, from the Petitioners’ solicitors for the Respondent to obtain the CGTC Certificate to enable the parties to settle at the required date, the Respondent appears to the Court, to have found obstacles; firstly being outside of the country, then directing his solicitors to wait for his return to attend personally to tax details, and informing of the existence of a caveat on the property that only served prolonged the time of the settlement to well beyond the Settlement Date.

[65] It has not escaped the attention of this Court that one Rajesh Prasad, the son of the Respondent had entered the affray and in the exchanges with the Petitioners, indicated on August 21^st 2014 that the Respondent can and is willing to proceed to the sale within 2 weeks but “the price will not be $360k as he signed previously.” Again in 26 August, 2014, Rajesh Prasad confirmed that the Respondent was willing to consider a settlement for $395,000.00. Much later in his affidavit purportedly executed at Nausori on 1 July 2016 in support of his Summon to stay, the Order of the Master of 19 July 2016, the Respondent annexed a Valuation Report putting the value of the property at $850,000.

[66] While the Respondent through Counsel, had distance himself from the actions of his son, it seems safe to this Court to assume that the Respondent had deliberately walked away from the Agreement for reasons other than the argument that the Petitioners had failed to pay the deposit, which this Court has found is without merit.

In the end, leave is hereby granted, and upon hearing the appeal, this Court Orders as follows:

1. The appeal is granted and the Court of Appeal judgment including order as to costs of 28 February 2020 are set aside.
   
2. The Orders of the Master of 27 July 2015 and Brito-Mutunayagam J of 14 October 2016 are hereby affirmed.
   
3. Costs of $5,000 is to be paid to the Petitioner by the Respondent within 14 days.
   

Hon. Mr. Justice Anthony Gates
Judge of the Supreme Court

Hon. Mr. Justice Brian Keith
Judge of the Supreme Court

Hon. Mr. Justice Filimone Jitoko
Judge of the Supreme Court

Solicitors:
Shelvin Singh Lawyers for the Petitioner
Sunil Kumar Esq for the Respondent