Shell Company (Pacific Islands) Ltd v Morris [2003] SBCA 15; CA-CAC 005 of 2003 (7 May 2003)

IN THE COURT OF APPEAL OF SOLOMON ISLANDS

SHELL COMPANY (PACIFIC ISLANDS) LIMITED
(Appellant)

–V-

WAYNE FREDERICK MORRIS AND BENJAMIN ST. GILES PRINCE
(as Trustees of the Estate of Rex Fera a Bankrupt) (Respondents)

(KABUI, J.)

Civil Appeal No. 005 of 2003

Date of Hearing: 29th April 2003
Date of Judgment: 07th May 2003

Mr C. Hapa for the Appellant
Mr J. Sullivan for the Respondents

JUDGMENT

Kabui, J: The Appellant filed a Notice of Appeal on 24th February 2003 against the ruling I made on 24th January 2003 in favour of the Respondents. The Appellant also filed a Notice of Application on 26th February 2003. The Notice of Application sought leave to-

1. extend time for application for leave to appeal to be filed;

2. appeal against my ruling delivered on 24th January 2003;

3. amend the Notice of Appeal filed on 24th January 2003.

In addition, the Appellant seeks an order to stay the execution of my order signed and perfected on 27th January 2003 and all further proceedings thereon pending the appeal. Counsel for the Appellant, Mr. Hapa, got into trouble at the hearing on 4th April 2003 on his application to amend the Notice of Appeal for Counsel for the Respondent, Mr. Sullivan, pointed out that the Notice of Appeal could not be amended without having first to amend the grounds of appeal upon which the application for leave to appeal was based. That point was obviously valid because the grounds of appeal set out in the Amended Notice of Appeal were at variance with the grounds of appeal filed on 24th January 2003. Also, Mr. Sullivan pointed out that if the Appellant wished to rely on the grounds of appeal set out in the Amended Notice of Appeal in order to seek leave to appeal, then it was important that the application for the Amended Notice of Appeal be granted first so as to provide the basis for the application for leave to appeal. At this point, Counsel for the Appellant, Mr. Hapa, applied for an adjournment and I granted it with costs. I granted the adjournment to enable the Appellant to file a fresh application for the orders sought. That application was filed on 10th April 2003. It was an Amended Notice of Application. All the orders sought in the Notice of Application filed on 26th January 2003 were repeated in the application filed on 10th April 2003 with one addition. The addition is that leave was also sought to amend the Notice of Application filed on 26th January 2003. The orders sought by the Amended Notice of Application are as follow-

1. to the extent that it may be necessary, leave be granted to the Appellant for late filing of its application for leave to appeal;
   
2. leave be granted to the Appellant to appeal against the decision of the High Court delivered on January 24th 2003 and perfected, signed and sealed on 27th February 2003;
   
3. leave be granted to the Appellant to amend the Notice of Application dated and filed on February 24th , 2003;
   
4. leave be granted to the Appellant to amend the Notice of Appeal dated and filed on February 24th, 2003;
   
5. execution and all further proceedings on the judgment of the High Court delivered on January 24th, 2003 and perfected, signed and sealed on January 27th, 2003 be stayed pending the hearing of the appeal.
   

Powers of the Court.

The powers of the Court are set out in section 19 of the Court of Appeal Act (Cap. 6). This section states-

“...The powers of the Court under this Part of this Act-

(a). to give leave to appeal;

(b) to extend the time within which a notice of appeal or an application for leave to appeal may be given or within which any other matter or thing may be done;

(c) to give leave to amend a notice of appeal or respondent’s notice;

(d) to give directions as to service;

(e) to admit a person to appeal forma pauperis;

(f) to stay execution or make any interim order to prevent prejudice to the claims of any party pending an appeal;

(g) generally, to hear any application, make any order, or give any direction incidental to an appeal or intended appeal, not involving the decision of the appeal, may be exercised by any judge of the Court in the same manner as they may be exercised by the Court and subject to the same provisions: but, if the judge refuses an application to exercise any such power or if any party is aggrieved by the exercise of such power, the applicant or party aggrieved shall be entitled to have the matter determined by the Court as duly constituted for the hearing and determining of appeals under this Act...”

I will deal with the amendment to the Amended Notice of Application first and then proceed to deal with the other points raised in that same Amended Notice of Application.

Amended Notice of Application.

The original Notice of Application was filed on 26th January 2003. The Amended one was filed on 10th April 2003. The application is for leave to be granted to amend the original Notice. The filing of the Amended Notice on 10th April 2003 presumes that leave to amend had been granted. In fact, this is not the case. The truth is that I am being asked to grant leave in retrospect. Although the sequence of steps taken is not correct, I will not refuse leave to amend the Notice. The language of section 19 of the Court of Appeal Act above is wide enough to enable me to grant leave to amend the Notice of Application. Leave is therefore granted.

Amendment to the Notice of Appeal filed on 24th February 2003.

The Court does have the power to amend a Notice of Appeal. Grounds 1 and 2 in the Amended Notice of Appeal are an amplification of grounds 1 and 2 in the original Notice of Appeal. They altered the alleged mistake by the trial judge from one of misdirection to erring in law on the question of exercising discretion on the question of setting aside an ‘unless order’ or ‘extension of time’. Likewise, the same was said as regards the exercise of discretion on matters of ‘extension of time’ and setting aside of ‘default judgment’ upon an ‘unless order’ except upon the agreement of the parties or upon proof of fraud or mistake. Grounds 3 and 4 are new. Ground 5 is again an amplification of ground 3 of the original Notice of Appeal. Ground 6 is the same as ground 4 in the original Notice of Appeal. The relief sought in lieu of the ruling delivered on 24th January 2003 is new in that it is an addition to the relief sought in the original Notice of Appeal. As pointed out by Mr. Sullivan, the grounds of appeal contained in the amendment being sought are indeed at variance with the grounds in the original Notice of Appeal. There had been a shift in some of the grounds of appeal in the Amended Notice of Appeal. The Appellant had not explained why there was the need to amend the Notice of Appeal. It is however obvious that the Appellant had wished to improve the grounds of appeal and accordingly notified the Respondent of that intention. Whilst Mr. Sullivan had opposed the amendment initially, he conceded that the Respondent had not been taken by surprise. I do not therefore see any reason why I should refuse leave to amend the Notice of Appeal. I grant leave to amend the Notice of Appeal filed on 24th February 2003. The Amended Notice of Appeal may be filed. As a matter of fact, an appeal is already on foot subject to leave being granted, if necessary.

Leave to extend time to file application for leave to appeal.

It is obvious that on filing the Notice of Appeal on 24th February 2003, the Appellant was faced with the question of whether or not my ruling on 24th January 2003 was interlocutory or final. The Appellant was not too sure of the position and so playing safe, the Appellant decided to seek leave to appeal on the basis that my ruling was interlocutory. However, the Appellant was already out of time under rule 10(2) of the Court of Appeal Rules, 1983. So it was necessary to apply for extension of time. To do this assumes that my ruling was interlocutory and not final. If it is interlocutory, then it is a necessary step to take and if leave is granted, leave to appeal may proceed in the usual way. If the second leave is granted, the appeal will certainly proceed to hearing. If, on the other hand, it is final then obviously, the need to extend time and to seek leave to appeal would have been unnecessary steps to take. It is therefore essential first to establish whether or not my ruling was interlocutory or final. This is so because Mr. Hapa did say in his affidavit that there were two conflicting views on the question of whether or not my ruling was interlocutory. The need to apply for extension of time to apply for leave to appeal arose out of his feeling of uncertainty over the issue. His strategy appears to have been influenced by the judgment of the Supreme Court of Papua New Guinea in Provincial Government of North Solomons v. Pacific Architecture Pty. Ltd. [1992] P.N.G.L.R. 145 cited by him in argument. In that judgment the said Supreme Court ruled on a preliminary point of law that the judgment of the National Court being final, the need for leave to appeal did not arise. Mr Hapa seems to believe that the issue of whether my ruling was interlocutory or not should first be decided and the way to do this was to do what he did. However, I must remind myself that I do not sit as the Court of Appeal to hear and decide substantive issues in dispute. Deciding the issue of whether or not my ruling was interlocutory seems to go beyond the powers of a single judge of appeal under section 19 of the Court of Appeal Act cited above. The Appellant must decide on what basis it should file its appeal and proceed on that basis. The answer clearly lies in the content of my ruling on 24th January 2003. In this case, the decision by the Appellant to seek extension of time was based upon Mr. Hapa’s uncertainty as to whether or not my ruling was interlocutory. This seems to be the reason for the delay for seeking leave to extend time. The delay was for more than 2 weeks. The reason for the delay was a technical one in that Mr. Hapa thought my ruling could have been interlocutory. Paragraph 24 of the affidavit filed by Mr. Hapa on 5th March 2003 states-

“...Our initial researches relative to the appeal, however, revealed that there were two alternative views held by the courts in relation to whether the Judgment constitute a final judgment or an interlocutory judgment. Before one can proceed with the appeal proper, this issue should be dealt with by the Court. Accordingly, we hereby seek leave for extension of time to file the Appellant’s application for leave to appeal purposely to obtain clarification from the Court as to whether the Judgment constitute a final judgment or an interlocutory judgment.”

This paragraph does speak for itself on that fact. This is supposed to be the explanation for the delay but this not evidence. It is an explanation as to why an application for leave to appeal out of time was necessary in this case being a point of law put forward for the opinion of the Court. I do not think I can grant leave to extend time on that basis. I am fully aware of the decision of the Court of Appeal in Price Waterhouse & Others v. Reef Pacific Trading Limited & Another, Civil Appeal No. 4 of 1995 as regards the issue of extension of time. In that case, there was evidence of delay but none in this case. In this case, the original Notice of Appeal was filed on 24th January 2003 and served on the Respondents on 25th January 2003. It was after that, it would seem, that Mr. Hapa thought it was necessary for the Court to clarify whether my ruling was interlocutory or not. It is to my mind not a secret that there do exist in this jurisdiction interlocutory judgments/orders and final judgments/orders as well. It should not be an issue at this stage of filing an appeal. It is not a good reason to extend time in order to seek leave to appeal. I am also aware of the decision by the Court of Appeal in Reef Pacific Trading Limited, Civil Appeal No. 1 of 1992 where extension of time had been refused by the trial judge but subsequently extended by the Court of Appeal under Order 64, rule 5 of the High Court Civil Procedure Rules 1964, ‘the High Court Rules’. Again, in that case, although there had been no affidavit evidence of what the delay had been, there was circumstantial evidence from which the reasons for the delay was inferred. As I have said above, the reason for the delay in this case was the late decision to raise a preliminary point of law for clarification by the Court. Such a point is best left to the Court of Appeal to decide. Leave to extend time is therefore refused.

Application for a stay of ruling.

There is power to order a stay of execution. (See Selwyn Dika and Another v. David Somana and Others, Civil Case No. 208 of 2002). To exercise that power and to grant the order is another thing. The application to stay execution and all further proceedings relates to my ruling on 24th January 2003. The formal order that followed was dated 27th January 2003. The terms of the order are-

“1. The Summons be dismissed.

2. The Defendant pay the Plaintiffs’ costs of and incidental to the application to be taxed if not agreed.”

This is the order I am being asked to stay pending the appeal. I do have difficulty with doing anything with this order in that any order to stay this order would not benefit the Appellant in anyway. However, the effect of this order is that it allows the order I made on 4th December 2002 to take effect. This order is as follows-

“The Defendant having failed to comply with Order 1 of the Consent Order filed and perfected herein on 12 November 2002 Judgment in Default of compliance is hereby entered against the Defendant in accordance with Order No. 2 of the said consent order in the sum of $SBD 2,049,913.66 together with interest thereon at the rate of 5% from 13 June 2002.”

This order however is not the subject of the application for a stay in this case. I think I cannot consider something that is not asked for in this case and decide to grant it or not to grant it. I do not think I would grant the order sought in the application for a stay. Having granted leave to amend the original Notice of Application and Notice of Appeal, I would not do the same and grant the other orders sought in the same application. The order of the Court in terms of the Amended Notice of Application is that orders 3 and 4 are granted. Orders 1, 2 and 5 are refused. Costs will be costs in the appeal.

F.O. Kabui
Judge