Van Vlymen v Levers Solomon Ltd [2021] SBCA 2; SICOA-CAC 20 of 2019 (1 February 2021)

IN THE SOLOMON ISLANDS COURT OF APPEAL

Case name:	Van Vlymen v Levers Solomon Ltd
Citation:
Decision date:	1 February 2021
Nature of Jurisdiction	Appeal from Judgment of the High Court of Solomon Islands (Faukona J)
Court File Number(s):	20 of 2019
Parties:	Willem Johan Van Vlymen v Levers Solomons Limited, Russel Island Plantation Estates Limited
Hearing date(s):	29 October 2020
Place of delivery:
Judge(s):	Goldsbrough P Lunabek JA Gavara-Nanu JA
Representation:	Sullivan J QC with Kingmele R for Appellant Burchett S and Willy A for Respondent
Catchwords:	Default judgment Obligations of legal practitioner
Words and phrases:
Legislation cited:	Solomon Islands Civil Procedure Rules 2007, r 17.34, 5.8, 5.37 (a), 5.11, 5.37 (b), 7.5, 1.3, 1.4 (c), 19.1 (h) 9.22, Court of Appeal Act S 12 [cap 6],
Cases cited:	Yeo v Iromea [2018] SBCA 6, Sunway v Havimei [2019] SBCA 19, Panisi v Matezama [2019] SBCA 22, Tipaika v Magu [2019] SBCA 17, Wright v Hearson [1916] W.N 216, Peter Bire v. Dr. Phillip Kereme [2016] N6328, Rondel v. Worsely [1966] 3 WLR 950 at 962, Saif Ali v Sydney Mitchell [1980] AC 198, Giannarelli v Wraith, Shulkes v. Wraith [1988] 81 ALR 417, Arthur Hall v Simons [2002] AC 615, Copeland v Smith [2002] 1WLR 1371, New World Ltd v Brown [2016] SBHC 192, Golden Spring Ltd v. Paia [1999] SBCA 11, Sukumaran v Pillai [2013] SBHC 153, Classique v. Marine Services Ltd [1993] SBCA 3, ANZ Banking Group v Kaukui [2015] SBHC 35, Lone v. Solomon Telecom Co. Ltd [2018] SBCA 25
ExTempore/Reserved:	Reserved
Allowed/Dismissed:	Allowed
Pages:	1-15

JUDGMENT OF THE COURT

1. Pursuant to the leave granted by the full Court on 18 October, 2019, the appellant appeals against the whole of the decision of Faukona J, given on 4 March, 2019, in which his Lordship dismissed the appellants’ application to set aside the purported service of a Category B Claim in the Civil Case No. 287 of 2018 in the High Court on 18 August, 2018 and the entry of the default judgment against the appellant by the Registrar on 16 October, 2018.
2. The appellant raised eight grounds of appeal. In the first ground, it is claimed that the learned primary judge failed to give reasons or any proper reasons for his decision, as required under r. 17.34 of the Civil Procedure Rules, 2007 (CPR). The issue raised in the second ground is the same issue raised in the fourth ground, viz; the appellant claims the learned primary judge erred in holding that the appellant was properly served with the claim. The third, fifth and sixth grounds challenge the entry of the default judgment by the Registrar. The appellant claims the default judgment was irregularly entered. In the third ground, the appellant challenges the exercise of discretion by the learned primary judge to dismiss his application to set aside service and the entry of the default judgment. This is based on the claim that there was evidence before the learned primary judge that a conditional response had been filed and that service was a pending issue before the High Court. In the fifth ground, the appellant challenges the exercise of power by the Registrar to enter default judgment after the application to set aside service had been filed in the High Court. The sixth ground, although framed in the alternative, essentially repeats the third and fifth grounds. The seventh and eighth grounds are consequential upon the outcome of the first six grounds.
3. The appellant seeks orders that the appeal be allowed and the decision of the learned primary judge set aside. He also asks for costs on indemnity basis.
4. It is trite law that the appellant carries the onus to demonstrate error in the learned primary judge’s decision.
5. Looking at the material before the court, including submissions by counsel, we consider that the appeal turns on whether the default judgment was regularly entered.
6. We note that the appellant filed the conditional response on 6 September, 2018, which was outside 14 days from 18 August, 2018, which according to the respondents was the day the claim was purportedly served. This purportedly breached rr. 5.8 and 5.37 (a). We also note that by 17 September, 2018, which according to the respondents was the day the 28 day appeal period expired (from 18 August, 2018), the appellant had not filed the defence. This purportedly breached rr. 5.11 and 5.37 (b).
7. The conditional response was in the following terms: “Take notice that Desmond W Nimepo of Light Lawyers now acts for the defendants in the above proceedings. The address for service, LIGHT LAWYERS, Light Lawyers compound, Mbokonavera 4 Heights Honiara”.
8. In a letter dated 11 September, 2018, the appellant's lawyer, Desmond W N Nimepo wrote to the respondents’ lawyers advising them that service of the claim was in dispute. The last two paragraphs appear pertinent, they read as follows:
   • “...There is still no proper service done on the Defendant of the main claim. Our filing of the conditional response is based on third party information. The defendant is a citizen of Australia and he is residing in Australia. Therefore upon proper service our client will make a formal representation to the claim.
   • We will be filing appropriate application to challenge the improper service and likely cross claim upon advice from the defendant as of yet your office must make proper service”.
9. This letter was not copied to the Registrar. The letter may not have been significant as it was not a formal court document, however, it appears that pursuant to that letter, the appellant on 19 September, 2019 filed an application to set aside the purported service of the claim on the appellant. The application however did not have with it sworn statements in support, as required by r 7.5(b). This resulted in the Registrar writing to the appellant’s lawyers twice, asking whether the appellant would file supporting sworn statements. No replies were received from the appellant’s lawyers to those letters.
10. In a Notice of Hearing dated 28 November, 2018, the appellant's applications to set aside service and the entry of the default judgment were set down for hearing on 4 March, 2019.
11. However, on 12 October, 2018, the respondents filed an application for default judgment. Mr. Desmond Nimepo, lawyer for the appellant, in his sworn statement made on 24 October, 2018, deposes that his firm was not served with the application. On 16 October, 2018, the respondents’ lawyers made an application for a default judgment ex-parte before the Registrar. The appellant was not represented at that hearing. Upon hearing the lawyer for the respondents, the Registrar entered the default judgment against the appellant in liquidated amounts, with interest.
12. We agree with Mr Simon Burchett, counsel for the respondents that the Rules should be given a purposive interpretation as envisaged by r. 1.3 to give effect to their ‘’overriding objective’’ which is to enable the courts to deal with cases “justly with minimum delay and expense”. Notably, r. 1.3 not only provides for dealing with cases “with minimum delay and expense”, but more importantly, it also provides for the courts to deal with the cases "justly". Doing justice in a case is the core objective of the Rules. This requirement gives efficacy to the prime duty of the courts to administer and do justice in a case. This is synonymous with the principle that rules are not an end in themselves but are a means to achieving justice. To achieve this objective the courts must have regard to all the circumstances of the case in order to reach just and fair decisions. See, Yeo v. Iromea [2018] SBCA 6; SICOA-CAC No. 13 of 2017 (11 May, 2018); Sunway Limited v. Jelista Havimei SICOA-CAC No.13 of 2019 (18 October, 2019); Ernest Regho Panisi & Annette Duri and Leslie Ofu v. Isaac Matezama SICOA-CAC No. 49 of 2019 (18 October, 2019) and Tina Tipaika v. Felix Magu and Other[s SICOA-CAC No. 1 of 2019 ((18 October, 2019).
13. For the Rules to be properly invoked, it will involve proper exercise of courts’ broad discretion and the courts have in the exercise of their discretion shown that failure to comply with the Rules is not always fatal. The courts may for example set aside or even ignore the steps taken by parties in a proceeding if it is in the interest of justice to do so. See, Carey v. Sumsum [2013] SBHC 91; HCSI – CC 290 of 2011(12 July, 2013).
14. In Tina Tipaika, this Court in echoing these principles, also reiterated the requirements of r.1.4(c) which prescribes the factors the courts should consider and account for, to deal justly with cases before them:
    • “...dealing with the case in ways that are proportionate:
    • (i) to the importance of the case; and
    • (ii) to the complexity of the issues; and
    • (iii) to the amount of money involved; and
    • (iv) to the financial position of each party...”
15. The failure by the appellant to file the conditional response and the defence in accordance with the requirements of the Rules are examples of non-compliance with the Rules and insufficient material being made available by the appellant which resulted in his initial application for leave to appeal being refused. The appellant subsequently availed sufficient material thus resulting in his second application for leave to appeal being granted by the full court. The material related specifically to the appellant’s challenge to service of the claim and the exercise of power by the Registrar to enter default judgment against him. The new material clearly showed an arguable case and that the matter was of public importance and the material further showed that substantial injustice was likely to be suffered by the appellant if the seeming erroneous decision was allowed to stand. These factors provided the basis for the full court to grant the appellant’s second leave application. The full court in its decision among others said:
    • “It is conceded by counsel for the applicant that the material previously made available to the Court was inadequate to achieve the grant of leave as requested. There is now additional material available, subject to the grant of leave to amend the renewal application and receive that material. That material is said better to reflect the position of the applicant and present a fuller picture, including the draft defence. That draft defence is necessary to show the grant of leave has behind it some real purpose.
    • ...We feel that, on the grounds relied upon by the applicant, being without merit, there is no basis for the grant of leave. We note that to allow this court to determine the matter with a full picture it may be necessary to grant leave for the further amended renewal application and material and to that extent we grant leave. But the picture we find on the grounds relied upon does not indicate the grant of leave to appeal against either the decision to set aside service or the default judgment.
    • We note, however, the circumstances in which the Registrar entered default judgment. This issue was not pressed as a reason for the grant of leave but is a matter that we considered relevant”.
16. It was submitted by Mr Burchett that entry of the default judgment was regular because the appellant failed to file sworn statements in support of his application to set aside service. He further submitted that the Registrar had twice asked the appellant to file supporting sworn statements but failed to do so.
17. On 4 March, 2019, neither the appellant nor his lawyers appeared to argue their applications before Faukona J. No explanation was given by the appellant and his lawyers for their failure to appear in Court that day. The learned primary judge after being satisfied that the appellant and his lawyers were aware of their applications being heard that day, dismissed both applications with costs on indemnity basis with certified costs for overseas counsel. In his decision, his Lordship among others, referred to the sworn statements of the process servers and held that he was satisfied that the service of the claim on the appellant was proper.
18. Mr. Sullivan QC, of counsel for the appellant submitted that the default judgment was irregularly entered because the appellant’s application to set aside service was still pending before the High Court. It was submitted that in those circumstances, the Registrar had no jurisdiction to deicide service and enter default judgment. There is no dispute that the respondents’ lawyers were put on notice regarding service being disputed in the High Court through service on them of the respondents’ application to set aside service. In regard to the Registrar, she had or should have had or was deemed to have had notice of the respondents’ application to set aside service through the court file which contained the application.
19. Having considered the material made available to the Court, as well as submissions by counsel, notwithstanding the force of the arguments of Mr Burchett, we are not convinced that the default judgment was regularly entered. Our decision is based on the fact that appellant’s application to set aside service was pending before the High Court when the default judgment was entered. We agree with Mr. Sullivan that the Registrar had no jurisdiction to hear and decide the respondents’ application for default judgment, let alone enter default judgment when service was being challenged in the High Court.
20. We also consider that it was improper for the respondents’ lawyer to appear before the Registrar and make an ex-parte application for a default judgment for two reasons. First, the appellant’s lawyers were not served with the application. Second, the appellant’s application to set aside service was pending before the High Court. If the Registrar had misapprehended the Rules, or even if that was not the case, it was incumbent on the lawyer to advice the Registrar that the issue of service was pending before the High Court and furthermore, because the respondents’ lawyer was not present the application should be deferred. We feel strongly about this issue and we are compelled to make some observations regarding duties and responsibilities of lawyers in such situations.
21. The lawyers appearing before the Registrars have same responsibilities as lawyers appearing before a court of law, because pursuant to r. 19.1 (h) and 9.22, the Registrars exercise powers and functions of the courts. In that regard, the lawyers as officers of the court must be honest in dealing with cases and discharge their duties and responsibilities with high ethical standards and assist the Registrars to also discharge their powers and functions properly. Acting ethically lies at the core of a lawyer’s work, both as an advocate and as a human being because ethical conduct builds reputation and integrity. Lawyers should strive to practice law on the firm and strong ethical foundation.
22. The lawyers are reminded often of these ethical principles, more so as advocates in the courts. For example, Street CJ in Croll v. McRae [1930] NSWStRp 14; (1930) 30 SR (NSW) 137 at 146 in stressing the principles said:

“I cannot impress too forcibly upon members of the Bar the necessity for observing high standards of professional conduct and a proper sense of responsibility in the conduct of cases. If that is not done the whole profession will suffer in the estimation of the public”.

23. In Wright v. Hearson [1916] WN 216, Rowlatt J, in echoing the same principles gave this reminder:

“It is the duty of counsel to know and observe the rules governing what they may and may not do in the conduct of cases; ...as counsel voluntarily observe those rules, so will their standing and reputation grow”

24. .In Peter Bire v. Dr. Phillip Kereme [2016] N6328, a case in Papua New Guinea National Court in which similar issues arose and the trial judge, Gavara-Nanu J expanded these principles when applauding a lawyer representing a client volunteered a case which favoured more the opposing party. The trial judge said:

“I applaud Ms Mel for bringing the above case to the attention of the Court because although the case does not fully support her line of argument, it is of great assistance to the Court in deciding whether the PSC had power to review the matter. In this regard, I consider it important and convenient that I make some pertinent observations on the duty of counsel to assist the court fully in deciding issues before it. The significance of this duty lies in the counsel’s duty to assist the court in the administration of justice. It is a fundamental principle of law that a lawyer’s duty to the court takes precedence over his other duties, including his duty to his client. This principle is based on the position of the lawyer as an officer of the court, and as one who has control of his client’s case in court. This duty includes the duty to disclose to the court all the cases that are or may be relevant to the issues before the court, even those which may not support his client’s case. This in fact is a requirement under the Lawyers Professional Conduct Rules, 1989, viz; rr.10 (1) and 15 (5). What is of paramount importance is that the court must be fully assisted by counsel, in deciding issues and in the administration of justice to all the parties to the litigation. It is important for one to remember that administration of justice is not a mere intellectual concept or a professional routine. It is more than a step in a process. It is central to the work of every judge, because justice has to be administered ‘according to law’. A judge must therefore discharge this duty with every care and skill he can muster and how a judge administers justice in the broadest sense is of vital importance. This is why assistance by counsel to the judge is very important and indeed the judges look to counsel appearing before them for guidance and assistance. Entitlement to justice is a right to everyone and where one is denied justice, it must be for sound and valid reasons. This is important to build public confidence and trust in the impartiality and integrity of the judiciary. This is of fundamental importance to administration of justice and the rule of law generally. These observations may be obita dicta, but an occasion has arisen for the observations to be conveniently made as they relate to a basic principle of advocacy which every lawyer should be aware of, especially those who appear in court. The significance of the principle has been prominently stated in many cases, but I will highlight only a number of them.

In Rondel v. Worsely [1966] 3 WLR 950 at 962. Lord Denning MR stated:

“Counsel has a duty to the Court which is paramount. It is a mistake to suppose that he is the mouthpiece of his client to say what he wants, or his tool to do what he directs. He is none of these things. He owes allegiance to a higher cause. It is the cause of truth and justice”

In Saif Ali v. Sydney Mitchell [1980] AC 198, Lord Diplock stated:

“The special characteristic of a barrister’s work upon which the greatest stress is laid by their Lordships was that he does not owe a duty only to his client; he owes a duty also to the court. This is an overriding duty which he must observe even though to do so in a particular case may appear to be contrary to the interests of his client...,”

In Giannarelli v Wraith, Shulkes v. Wraith [1988] 81 ALR 417, Mason CJ at p. 421 stated:

“...the barrister’s duty to the court epitomises the fact that the course of litigation depends on the exercise by counsel of an independent discretion or judgment in the conduct and the management of a case in which he is an eye, not only to his client’s success, but also to the speedy and efficient administration of justice”.

In Arthur Hall v. Simons [2002] 1 AC 615 Lord Hoffmann at pp. 686 and 692 stated:

“Lawyers conducting litigation owe a divided loyalty. They have a duty to their clients, but they may not win by whatever means. They also owe a duty to the court and the administration of justice. They may not mislead the court or allow the judge to take what they know to be a bad point in their favour. They must cite all relevant law, whether for or against their case.

....I have no doubt that the advocate’s duty to the court is extremely important in the English system of justice...The substantial orality of the English system of trial and appellate procedure means that the judges rely heavily upon the advocates appearing before them for a fair presentation of the facts and adequate instruction in the law. They trust the lawyers appearing before them; the lawyers trust each other to behave according to the rules, and that trust is seldom misplaced...

Then Lord Hope in the same case at pp. 715 and 726 stated:

“The advocate’s duty to the court is not just that he must not mislead the court, that he must make sure that the facts are presented fairly and that he must draw the attention of the court to the relevant authorities even if they are against him...

....The duty which the advocate undertakes to his client when he accepts the client’s instructions is one in which both the court and the public have an interest. While the advocate owes a duty to his client, he is also under a duty to assist the administration of justice...his duty to the court and the public requires that he must be free, in the conduct of his client’s case at all times, to exercise his independent judgment as to what is required to serve the interests of justice. He is not bound by the wishes of his client in that respect, and the mere fact that he has declined to do what his client wishes will not expose him to any kind of liability”.

In Copeland v. Smith [2000] 1 WLR 1371, the Court said:

“It is of course, the duty of an advocate under the English system of justice to draw the judge’s attention authorities which are in point, even if they are adverse to that advocate’s case”.

25. The essence of the utterances in all these cases is that the lawyers who deal with cases before the courts or Registrars exercising judicial powers and functions as in this case, are also involved directly in the administration of justice and it is incumbent on them to ensure that justice is done in the case. It appears to us that in this case, this duty was neglected by the respondents' lawyer.
26. It follows that given that the default judgment was irregularly entered, the learned trial judge also erred in his decision of 4 March, 2019, because in law, there was nothing for the learned trial judge to set aside. The consequence of this is that the appeal must be allowed. We are mindful that both parties have defaulted in complying with the Rules. For example, the appellant failed to file its conditional response and defence within the timeframe required under the Rules. The respondents also failed to serve their application for default judgment on the appellant. They also applied for a default judgment when the appellant’s application to set aside service was pending before the High Court. In these circumstances, we consider that proper order for us to make is that the case be remitted to the High Court to be further dealt with. In making this order, we note that there is a draft defence which we consider raises sufficiently arguable questions as to fact and law, which in our view is real and not a sham. Consequently, pursuant to the powers conferred on the Court by s. 12 of the Court of Appeal Act, Chapter 6 and the inherent powers of the Court, we order that the draft defence become the defence to the claim. See, Golden Spring Ltd v. Paia [1999] SBCA 11; CA-CAC19 of 1998(24 November, 1999). 26. See also New World Ltd v. Brown [2016] SBHC 192; HCSI-CC 26 of 2014 (27 October, 2016); in which Maina J, in adopting what Apaniai J, said in Sukumaran v. Pillai [2013] SBHC 153- CC 396 of 2012 (20 November, 2013); relevantly observed:

"...when a defence has been filed late; the court cannot simply ignore the contents of the late defence but must use the contents to assess whether there is a good defence. If a good defence is shown by the late defence that is sufficient reason for proceeding to trial..."

27. We order the parties to forthwith file appropriate documents and take other necessary actions required of them under the Rules to expedite the case to trial.
28. As to costs, it is a discretionary matter and in our view the issues before us could have been raised and dealt with by the court below had the appellant and his lawyers appeared before the learned primary judge on 4 March, 2019. No explanation was offered for their failure to appear before the primary judge. As to the respondents, because they were responsible for the irregular entry of the default judgment, they would ordinarily be liable to pay costs. See, The Owner of the Ship Classique v. Marine Services Ltd [1993] SBCA 3; CA-CAC 008 of 1992 (30 June, 1993). However, we also note that because the default judgment was irregularly entered, the learned trial judge had no jurisdiction to refuse to set it aside. See, ANZ Banking Group v. Kaukui [2015] SBHC 35; HCSI-CC 91 of 2014 (6 May, 2014) and Lone v. Solomon Telecom Co. Ltd [2018] SBCA 25; SICOA-CAC 9029 of 2017 (12 October, 2018). In the circumstances, we consider that the fair and proper order for the court to make is for the parties to pay their own costs, and we so order.
29. Consequently, the Court makes the following Orders:
    • (i) The appeal is allowed.
    • (ii) The default judgement purportedly entered on 16 October, 2018, against the appellant is set aside.
    • (iii) The matter is remitted to the High Court to be further dealt with and the parties are to forthwith file appropriate documents following on from the appellant's draft defence which is the defence to the claim, and take other necessary actions required of them under the Rules to expedite the case to trial.
    • (iv) The appellant’s draft defence be the defence to the claim.
    • (v) Each party to pay its own costs.
30. Orders accordingly.

Goldsbrough P
Lunabek JA
Member
Gavara-Nanu JA
Member