Lili Store v Hong Yi Ltd [2011] SBCA 12; Civil Appeal Case 10 of 2011 (12 October 2011)

IN THE COURT OF APPEAL OF SOLOMON ISLANDS
(Mwanesalua J)

Civil Appeal Case No. 10 of 2011

BETWEEN:

LILI STORE
Applicant

AND

HONG YI LIMITED
Respondent

Date of Hearing : 5 September 2011
Date of Ruling : 12 October 2011

Mr. C Hapa for Applicant
Mr. M Tagini for Respondent

RULING

1. This is an application for stay of execution of Judgment and enforcement of orders pursuant to Section 19 (f) of the Court of Appeal Act (Cap. 6). There is also application under Section 19 (g) of the Court of Appeal Act in relation to orders 1 and 2 of the court orders of 7 June 2011 referred to in paragraph 3 below. The Applicant was the Second Defendant in Civil Case No. 16 of 2009 in the High Court. The judgment was made in favour of the Respondent on 7 April 2011. Paragraphs 9 and 10 of that judgment are in these terms:
   

"9. As the amounts payable by the Second Defendant to the Claimant are:-

Cost of purchasing the 22 bags of Bechede-mer	SBD274,785.21
Loss of profit on above	SBD383,353.04
(being 658,138.25 net minus shown above)
Interest from date of claim to date of judgment at 5% SBD$ to	be calculated by counsel.

"10. Cost of the Claimant are awarded against the Second Defendant, such costs to be agreed or taxed. As earlier indicated, interest at the prevailing rate of 5% is payable from date of judgment to settlement. Previous interest must be calculated by the Claimant based on the figures determined to be payable as above and incorporated as a lump sum in the judgment order.

2. The Applicant applies for the following orders:
   
   • (1) Stay of execution of:
     
   • (a) Orders 3, 4 and 5 of the orders perfected, signed and sealed by his Lordship Justice E. Goldsbrough on June 7, 2011;
     
   • (b) The Enforcement orders perfected, signed and sealed by the Registrar of the High Court on August 12, 2011.
     
   • (2) The sum of $721,207.25 be deducted and released to the Respondent from the total sum of $825,281.40 currently held in the Respondent's solicitors' trust account, in satisfaction of orders 1 and 2 of the Orders perfected, signed and sealed by his Lordship E Goldsbrough on June 7, 2011, notwithstanding that Order (b) above whereby stay of execution is sought in respect of the Enforcement Orders.
     
   • (3) That the balance remaining from the sum of $825,281.40 currently held in the Respondent's solicitors' trust account totally up to $104,074.15 (after deducting the amount of $721,207.15) be paid into court as security for payment; and
     
   • (4) Costs be in the cause.
     
3. The Orders perfected, signed and sealed by his Lordship Justice E Goldsbrough on June 7, 2011 are in these terms:
   
   • (1) The Second Defendant pays to the Claimant a total of SBD658,138.25 being the costs of the 26 bags of beche-de-mer and the loss of profit suffered by the Claimant
     
   • (2) The Second Defendant pays the Claimant an interest of 5% from the date of judgment in the sum of SBD63,069.00.
     

(3) The Second Defendant pays to the Claimant on interest of 5% per day from date of judgment, 7th April 2011 to the date of settlement, assuming to be on 7th of June 2011 in the sum of SBD1,974,960.00.

(4 ) The prevailing rate of SBD32,916.00 per day shall accumulate until final settlement.

(5 ) The total sum to be paid by the Second Defendant to the Claimant as of 7th June 2011 is SBD2,696,167.25."

4. The Enforcement Orders perfected, signed and sealed by the Registrar of the High Court on August 12, 2011 relevantly state:
   

"IT IS HEREBY ORDERED AS FOLLOWS:

1. The Sheriff of the High Court is hereby ordered to enforce the Judgment Order of the High Court perfected on the 7th of June 2011.
   
2. The Sheriff is further ordered to recover:
   

The Debt	$2,696,167.25
Filing and Service fees	$ 1,125.00
Total	$2,697,292.25

from the Enforcement debtor.

3. The Sheriff is also ordered to recover any further accumulating sum pursuant to order 4 of the perfected orders of 7th June 2011 and such amount be determined on the date of final settlement.
   
4. This Order shall expire on 12th August 2012 and shall be renewed upon further application to the High Court.
   
5. The Sheriff is authorized to seize and sell any property belonging to the Enforcement Debtor.
   

Signed, Sealed and perfected 12th August 2011.

THE COURT"

5. The case for the Respondent is that orders 3, 4 and 5 were made in accordance with the judgment of the court on 11 April 2011. The Respondent has the right to reap the benefits of those orders.
   
6. On the contrary, the Applicant says that those orders be stayed because it can point to a reason why the court should exercise its discretion to stay the orders.
   

Application to stay orders 3, 4 and 5

7. The claim for damages in this case was filed on 29 May 2009. On 7 April the High Court gave judgment on assessment of damages after default judgment against the Applicant. Interest from date of claim to date of judgment was 5%. The Applicant agreed with this interest rate. On 7 June 2011 the Respondent filed orders as in paragraph 3 above. They were served on the Applicant on 9 June 2011. On this date the Respondent confirmed that the total sum of $825, 281.40 from Applicant was already with the Respondent's trust account. That money was more than sufficient to satisfy the judgment debt and the interest from the date of claim to date of judgment. On 14 June 2011 the Respondent's solicitors requested the Applicant's solicitors for consent to withdraw money from the Trust account to settle part of the judgment sum ordered by the court. However, the Applicant's Solicitors were concerned about the manner in which interest was calculated to arrive at the amounts in orders 3 and 4. The calculations were not based on 5% as shown in the judgment. The Applicant then filed an appeal against orders 3, 4 and 5 to the Court of Appeal. On 16 June 2011 the Applicant's solicitors wrote to the Respondent's solicitors for the parties to consent for the withdrawal of money from the Trust account to meet the judgment debt and interest accruing from the date of claim to date of judgment. There was no response from the Respondent. On 12 August 2011 the Respondent took Enforcement orders against the Applicant. The Applicant believes there was an error in the calculation of interest accruing from the date of judgment to 7 June 2011. The Respondent did not indicate any reason for not agreeing to withdraw the sum of $721,207.25 from the Trust Account to cover the judgment debt and interest.
   

The Applicant formed the view that the Respondent still held onto the $825,281.40 in the Trust Account to earn interest.

Orders 1 and 2

The $825,281.40 was held in the Trust Account when the court made the orders. The Respondent could have agreed with the Applicant to settle the amounts in order 1 and 2 but that did not occur.

The Court

It would seem that the reason for the Respondent for not agreeing to withdraw money from the Trust Account to settle the judgment debt and interest was to gain interest. But the most important issues which still persists between the Applicant and the Respondent regards the interest of 5% per day in Order 3 and the prevailing rate of SBD32,916.00 per day being charged by the Respondent respectively.

I consider these are issues for consideration by the full court, to determine whether they are in accordance with the judgment of the court below.

In the circumstances, I grant the orders sought by the Applicant. Order accordingly.

THE COURT