Abe v Minister of Finance [1994] SBHC 22; HC-CC 197 of 1994 (12 August 1994)

HIGH COURT OF SOLOMON ISLANDS

Civil Case No. 197 of 1994

CHRISTOPHER COLUMBUS ABE

-V-

MINISTER OF FINANCE And ATTORNEY GENERAL

High Court of Solomon Islands
(Muria, CJ.)

Hearing: 10 August 1994
Judgement: 12 August 1994

Christopher Columbus Abe the Applicant in person
Minister of Finance 1st Respondent in person
Attorney General 2nd Respondent in person

MURIA, CJ: On 18 July 1994, the Applicant Mr. Christopher Columbus Abe, MP, filed in this Court an Originating Summons seeking a number of declarations against the Hon. Minister of Finance as the 1st Respondent and the Hon. Attorney General as 2nd Respondent. In support of his application, the Applicant filed an affidavit on 22 July 1994 which sets out a number of annexure including the 1994 Appropriation Act 1993 ("CCA1") and a document itemising Government loans and securities from Central Bank of Solomon Islands, commercial banks, financial institutions and the public ("CCA5").

On 28 July 1994, the 1st Respondent filed a Summons seeking to set aside the Originating Summons filed by Applicant on the ground that it discloses no reasonable cause of action. In support of his application, the 1st Respondent filed a short affidavit.

On 10 August 1994 both applications came before the Court and it was agreed that the Court should deal with the 1st Respondent's Summons first. Consequently, this judgement is in relation to the application brought by the 1st Respondent.

In his Summons, the 1st Respondent seeks to set aside the Applicant's Originating Summons. It now appears that the thrust of 1st Respondent's submission is really to have the Applicant's Originating Summons struck out on the ground that it discloses no reasonable cause of action.

It is clear on first glance at the High Court (Civil Procedure) Rules, 1964 that the "setting aside" procedure is distinctively separate from that of the procedure on "striking out." The former is concerned with procedural defects arising out of non-compliance with the Rules of Court and which may well result in proceedings being null and void or being irregular. see O.12, r17; O.13, r.8; O.29, r.12 and O.38, r7. Also Poloso -v- HCCS Ltd. The latter is very much concerned with the exercise of the court's power, including its inherent power, to summarily stay or dismiss actions or to strike out pleadings which disclose no reasonable cause of action or which are vexatious or frivolous, or scandalous, or in any way an abuse of the court's process. It can also be used where an order of the court has not been complied with. See O.17, r.11; O.21, r.29; O.27, r.4; O.33, r.21 and O.40, r.11.

In the light of the rules, the Summons in this case seeking to set aside the Originating Summons on the ground that it discloses no cause of action is clearly not properly brought. However, having said that I must point out that it is not for the court to show to the parties how they should frame their case.

The other matter that has caused the court concern is that the 1st Respondent having brought his application to set aside the Applicant's Originating Summons, proceeded to rely on the submission that the Originating Summons should be struck out on the ground that it discloses no reasonable cause of action. Not surprisingly, the Applicant did not object to the 1st Respondent, proceeding on a basis not sought in the Summons. So much so that the 1st Respondent the Applicant and the learned Attorney General all proceeded on the basis that the Summons has sought to strike out the Originating Summons for not disclosing a reasonable cause of action.

However, despite such irregularities in the 1st Respondent's application, it remains very much a matter coming within the discretion of the Court as to whether or not such irregularities should necessarily avoid the proceedings. I feel that in view of the course which the parties have taken in these proceedings the court will deal with the application as if it is an application to strike out the Originating Summons on the ground that no reasonable cause of action has been disclosed.
The power of the Court to strike out pleadings is discretionary both under the Rules and its inherent jurisdiction. The provision of O.27 r.4 clearly shows this. O.27 r.4 provides:

"The Court may order any pleading to be struck out, on the ground that it discloses no reasonable cause of action or answer, and in .any such case or in case of action or defence being shown by the pleadings to be frivolous or vexatious, the Court may order the action to be stayed or dismissed, or judgment to be entered accordingly, as may be just.."

Under its inherent jurisdiction, the court has power to stay or dismiss actions, and to strike out pleadings which are vexatious or frivolous or in any way an abuse of the process of the Court. See the case of Reichel -v- Magrath, 14 App. Cas. 665; Remington -v- Scoles [1897] UKLawRpCh 78; [1897] 2 Ch 1 and Reef Pacific Trading Limited and Others -v- Reef Pacific (Sydney) Pty Ltd and Others. Civ. App. Case No. 1 of 1994 (CA).

The cases cited by the Applicant are mainly concerned with striking out "pleadings." But he says the rules stated in the cases he cited apply to proceedings for striking out Originating Summons since "pleading" includes "Originating summons by virtue of O.1, r.1 of the High Court (Civil Procedure) Rules. The definitions of "originating summons" and "pleading" in the rule mentioned do show, in my view, that the Applicant was correct in saying that an originating summons is a pleading within the meaning of r.4 of O.27. see Re Bartlett Berry's contract, (1887) 76 LT 751.

Although the 1st Respondent did not say on what basis he brings his application, it is clear that the relevant rule that he can rely on is 0.27, r.4 which empowers the court to "order any pleading to be struck out, on the ground that it discloses no reasonable cause of action." As I have already stated, that rule confers a discretionary power on the court to struck out any pleading.

This discretionary power of the court has been recognised in numerous cases. In Car Zeiss Stiftung -v- Rayner & Keeler Ltd (No. 3) [1970] Ch. 506 the court held that the power to strike out any pleading or any part of a pleading under this rule is not mandatory, but permissive, and confers a discretionary jurisdiction to be exercised if the court considers it just in all the circumstances to do so.

As to the cautionary exercise of the Court's discretion in application to strike out pleadings as disclosing no reasonable cause of action, the Applicant cited a number of authorities on this. They include Hubbuck & Sons Ltd -v- Wilkinson, Keywood & Clark Ltd [1898] UKLawRpKQB 176; [1899] 1 QB 86 where Lindley MR had this to say at p. 91:

The ... procedure is only appropriate to cases which are plain and obvious, so that any master or judge can say at once that the statement of claim as its stands is insufficient, even if proved, to entitle the plaintiff to what he asks. the use of the expression "reasonable cause of action" shews that the summary procedure ... is only intended to be had recourse to in plain obvious cases."

For the 1st Respondent to succeed in his application to set aside the Originating Summons in this case he must bring himself within that principle as stated by Lindley MR. He must show that the case pleaded by the Applicant in the Originating Summon against him is one that cannot be sustained or one that is unarguable.

The case of Hubbuck -v- Wilkinson had been applied in this jurisdiction in Judah Kulabule -v- Eagon Resources Dev. Co. (S.I.) Ltd (1993) CC No. 285 of 1993 (HC) where I said referring to O.27, r.4:

"The power of the Court in this regard is discretionary and must be exercised only where the court is satisfied that there is no reasonable cause of action or that the proceedings are frivolous and vexatious. However if the pleading is defective and the case can be improved by amendment so as to disclose a cause of action, then although the court may strike out the pleadings, leave may be granted to amend the pleadings. If the court is satisfied that no amendment will cure the defect, leave should not be granted."

In the earlier case of Attorney General of the Duchy of Lancaster -v- London & North Western Railway Co. [1892] UKLawRpCh 134; [1892] 3 Ch 274, Lindley LJ (as he then was) also had the occasion to consider an application to strike out pleadings under 0.25, r.4 of the then English Rules of the Supreme court which rule is the same as 0.27 r.4 in our High Court Rules. At pages 276 - 277, Lindley LJ (as he then was) stated:

"To what extent is the court to go on inquiring into difficult questions of fact or law in exercise of the power under which is given under Order XXV., rule 4? It appears to me that the object of the rule is to stop cases which ought not to be launched - cases which are obviously frivolous or vexatious or obviously unsustainable".

The Court refused to agree to strike out the pleadings in that case as on the face of the pleadings it was not frivolous or vexatious but raising an important point of law. Lindley LJ went on to add at p.277 that there might be applications in chambers to get rid of vexatious actions, but to apply the rule to a case like the one before the court appeared to misapply it altogether. The principle and the approach stated and taken in Hubbuck and Attorney General of the Duchy Lancaster are apt to the present case now before the court.

There are other authorities cited by the Applicant, including Kellaway -v- Bury (1892) 66 LT 599; General Steel Industry Inc. -v- commissioner for Railways [1964] HCA 69; (1964) 112 CLR 125 and Co-ownership Land Dev. Pty Ltd -v- Queensland Estates Pty Ltd (1973) 1 ALR 201.

The 1st Respondent comes to this court asking the court to strike out the Applicant's Originating Summons on the ground that it discloses not reasonable cause of action. It is on the 1st Respondent to show that the Originating Summons does not disclose a reasonable cause of action.

In his submission, the 1st Respondent argued that the Applicant has failed to supply details of the contracts relating to the lending by the financial institutions to the Government. Further, the document marked "CCA5" is not an official or certified copy of a document on the Government's borrowings. He added that such an action as that brought by the Applicant is dangerous in terms of the proper functioning of the Government and that it will affect future Government borrowing.

Apart from the assertion that the Originating Summons discloses no reasonable cause of action, there is really very little which the 1st Respondent placed before the court pointing to the pleadings or as he puts it, the Originating Summons, as not disclosing any reasonable cause of action. I am not saying that the matters raised by 1st Respondent are matters that the court cannot consider, far from it. What this court says is that in the views of the court, the matters now urged upon the court by the 1st Respondent do not bear upon the question of whether or not the pleadings disclose a reasonable cause of action.

The matter of affect (if any) the case may have on the Government's functioning does not mean that pleadings in the Originating Summons do not disclose a reasonable cause of action. A reasonable cause of action is not determined by the effect of the case on a party but on the Statement of Claim or the particulars of the Claim.

The matters of effect the case may have on the Government and its functions, the question of whether s.5(3) of the Appropriation Act confers authority on the 1st Respondent to borrow money, the question as to Public Accounts Committee (PAC) reporting to Parliament upon investigation of Government accounts, the question of Parliament not meeting and as such the Minister of Finance cannot go on waiting for Parliament to meet and the question that even if the court grants the orders sought, that there is nothing else the court can do, are clearly matters which are relevant to the merit of the claims brought against the Government and which the court will have to consider when it comes to decide in the exercise of its discretion whether the declarations sought by the Applicant ought to be granted or not.

There is one matter which, again, is not relied on by 1st Respondent in his summons but which he now raised in court. This is the question of the Applicant's locus standi.

The 1st Respondent argued that the Applicant has no locus standi to bring the action against the Government in this case. The Applicant, says the 1st Respondent, is a member of the PAC and an Member of Parliament (MP). As a member of the PAC, he should have made use of his position in that committee to investigate the Government's action rather than bringing the action himself to the Court. As an MP, the Applicant cannot point to any interest of his which has been breached and entitling him to seek redress from the court.

In either case the 1st Respondent says that no constitutional right of the Applicant has been breached.

Although not raised in the summons, I am prepared to consider this as it concerns the competency of the Applicant to bring his claim to this court. The Applicant relied on s.83(2) of the Constitution.

Section 83(2) provides:

"(2) The High Court shall have jurisdiction, in any application made by any person in pursuance of the preceding subsection or in any other proceedings lawfully brought before the Court, to determine whether any provision of this Constitution (other than Chapter II) has been contravened and to make a declaration accordingly:

Provided that the High Court shall not make a declaration in pursuance of the jurisdiction conferred by this subsection unless it is satisfied that the interests of the person by whom the application under the preceding subsection is made or, in the case of other proceedings before the Court, a party to those proceedings, are being or are likely to be affected."

It will be noted that section 83(2) of the Constitution does not restrict itself to breaches of the provisions of the Constitution only but it covers also a situation where any person who brings any proceedings lawfully to the Court and there is in that proceedings an allegation that a provision of the Constitution has been breached. The jurisdiction of the High Court can be invoked under this subsection so long as the court is satisfied that the interests of the person by whom the application ... is made are being or are likely to be affected or that the interests of a party to the proceedings before the court are being or are likely to be affected.

Section 83(1) in my view covers a Constitutional challenge brought pursuant to the provisions of the Constitution itself where a person alleges the breach of a Constitutional provision and that "his interests are being or likely to be affected by such contravention." The present proceedings instituted by the Applicant is clearly one that is not brought under subsection (1) of section 83 but rather under subsection (2) of that section.

The case of Kenilorea -v- AG (1983) SILR 61 (committee on Prerogative of Mercy case) is a case instituted pursuant to section 83(1) of the Constitution. Similarly the case of Kenilorea -v- AG (1984) SILR 179 (Price Control case) was also brought pursuant to section 83(1) of the constitution. In both cases Kenilorea was given locus standi by the High Court.

The Court of Appeal expressed reservations in the Price Control Case of the locus standi of the applicant in those two cases. However, until the Court of Appeal lays down the final position on the question of locus standi in constitutional challenges in Solomon Islands, the law on locus standi at present must be that as stated in the two cases in so far as the section 83 (1) provision is concerned.

The Applicant here has commenced these proceedings by way of Originating Summons pursuant to the rules of Court and these proceedings must be taken as lawfully brought before the court to determine not only an alleged contravention of the provisions of the 1994 Appropriation Act 1993 but also an alleged contravention of section 105(3) of the Constitution. The interests of the Applicant here are different from those of other members of the ordinary public. The Applicant's interests lie in the fact that he is one of the members of a specified group, in this country, namely Parliament and a former Minister of Finance but now a Shadow Minister of Finance in the Opposition. He, together with the other members of the Legislature including those in the Government and those in the Opposition enacted and passed the 1994 Appropriation Act 1993. He is also a member of the PAC which scrutinises and reports to Parliament on matters concerning the accounts and expenditure of the Government. His interests are so closely connected with the enactment and passage of the 1994 Appropriation Act 1993 that he would hardly justify turning a blind eye to any seeming breach of that law. The Applicant must be among the first who should come running to the court and praying the court to stop the breach. He must surely have the locus standi to do that. The Court of Appeal recognised a Memeber Parliament's standing to challenge a breach of the constitution. See The Speaker -v- Danny Philip App. Cas. No. 5 of 1990(CA) where the 1st Respondent was counsel for Danny Philip. At page 2 of Judgement the Court of Appeal says:

"Essentially, the question for this Court is whether his Lordship was right in concluding that the respondent 's constitutional right had been contravened and whether his rights were or were likely to be affected by that contravention for these are the conditions of the High Court's jurisdiction being enlivened under section 83. Although it is not disputed, it is desirable to state shortly why the respondent's interests are obviously affected by the ruling under discussion. If Mr Philip's motion had been passed on 16th November 1990 by an absolute majority it would have been incumbent upon the Governor-General under section 34(1) to remove the Prime Minister from office, whereupon the Members of Parliament would have been required to meet as soon as possible during the same session of Parliament to elect a new Prime Minister. The Prime Minister is elected by the Members of Parliament from amongst their number: section 33(1). The Respondent, as one of that number, had a two-fold interest in the outcome of the no confidence motion. He was interested as a potential elector of a new Prime Minister and as a person who was eligible for election to that office".

I do not think the Applicant here is a mere "busy body" meddling officiously in other people's affairs as Denning MR stated in the Federation of Self-Employed case [1980] 2 WLR 579. Rather the applicant has pointed to something which he said has gone wrong with the Government in performing its functions and responsibilities under the Appropriation Act and so it should be put right. He should therefore be heard.

Even if the Applicant do not have the necessary locus to invoke the jurisdiction of the Court under s.83(2), the Court will nevertheless exercise its jurisdiction in this case on the basis that the interests of the Government represented by the AG as a party to the proceedings are being or are likely to be affected. This is clearly stipulated under s.83(2) of the Constitution.

The argument put by the learned Attorney General that for the Applicant to have locus standi, he must show that he suffered some injury or financial loss is one to which I lam not attracted. In the Committee on Prerogative of Mercy and Price Control cases, the learned Attorney General appeared in both of those cases. In the former case, the learned Attorney General conceded that Kenilorea as Leader of Opposition had sufficient interest which was affected or likely to be affected in that as Leader of Opposition, he had a public interest to maintain the Constitution. In the Price Control Case the learned Attorney General in the Court of Appeal was not disposed to question the correctness of the decision on locus standi in the Committee on Prerogative of Mercy case.

Before this court in this case, the learned Attorney General now says that the Applicant must show he suffered some injury or some financial loss, on the basis, as he says, the Applicant in this case is in a different position to that of the Applicant in the two previous cases mentioned. With respect, I do not see the justification for the difference (if any) in terms of their legal standing. Both were Member of Parliaments, and in the Opposition except one was a Leader of Opposition and the other was a Shadow Minister of Finance. If injury or financial loss were to be the basis of invoking the jurisdiction of the court under s.83(1) and (2) of the Constitution, a good number of the citizens of this country would be shut out of the doors of the court. That cannot be within the spirit of the constitution.

To return to the question of striking out the Originating Summons on the ground that it discloses no reasonable cause of action, I ask the question: What is reasonable cause of action? 'Reasonable' here must mean reasonable according to law and as such a reasonable cause of action is one that is reasonable according to law.

In Republic of Peru -v- Peruvian Guano Co. [1887] UKLawRpCh 186; (1887) 36 Ch D 489, Chitty J. attempted to define what "reasonable cause of action" was At p.495 he said:

"There is some difficulty in affixing a precise meaning to. In point of Law ... every cause of action is a reasonable one."

In ascertaining whether there is a reasonable cause of action, one need only look at the pleadings or the Statement of Claim. In this case to ascertain whether there is an reasonable cause of action, one need only look at the particulars as stated in the Originating Summons See Davey -v- Bentinck [1893] 1Q B 185.

In Drummon - Jackson -v- British Medical Association [1970] 1 WLR 688 Lord Pearson also attempted to define 'reasonable cause of action' by saying that "a reasonable cause of action is a cause of action with some chance of success, when only the allegations in the pleading are considered." In this case the 1st Respondent submitted that the terms of the contracts between the Government and the lending institutions are necessary to be established without which the court would not know what the Applicant's claims are. This is really saying that without those terms, there is really nothing of substance before the court. However as Moore -v- Lawson (1915) 31 TLR 418 pointed out, so long as the pleadings disclose some cause of action. or raise some question fit to be decided by a Judge or a Jury, the mere fact that the case is weak and not likely to succeed, is not ground for striking out.

In any case, there is power within the meaning of r.4, of O.27 to grant leave to amend the pleading if in its present form it discloses no reasonable cause of action because of some omission in the pleading. But if the court is satisfied that no amendment will cure the defect, then leave should not be granted. see Judah Kulabule -v- Eagon Resources Dev. Co. (S.I) Ltd. (supra)

In a recent case in Papua New Guinea, Lowa -v- Kipe [1991] PNGLR 265, an application was made to the Court to strike out pleadings on the ground that it did not disclose a cause of action. That case involves matters of both constitutional and statutory interpretation. It concerns a number of appeals to the Supreme Court against the decision of the National Court.

One of the issues in that case relates to the requirements to be satisfied before a party can invoke the jurisdiction of the Supreme Court under S.18(2) of the PNG constitution. It was held that s.18(2) could only be invoked where a matter is properly before the court and secondly on proper factual findings and that these factors must give rise to a constitutional issue.

As to what constituted a 'cause of action' in that case, His Honour Kapi Dep. CJ said at page 290:

"The phrase 'cause of action' has to components. First, there must be a right which is given by a law, such as, entitlement to reasonable damages for breach of human rights under s58 of the Constitution. This is what is referred to as the form of action. Secondly, the pleadings must disclose all the necessary facts which give rise to the form of action."

With respect, I feel His Honour has set out a very useful approach as to how pleadings which involve both matters of Constitutional and statutory laws can be examined in order to determine the cause of action. I respectfully adopt His Honour's approach for the purpose of the present case.

The other matter raised by the learned Attorney General is that the affidavit filed by the Applicant contains insufficient facts to show reasonable cause of action. The authorities have clearly shown that a cause action is determined from the facts as disclosed in the pleadings or the particulars and not in the affidavit. In this case, the cause of action is determined by the facts as disclosed in the Originating Summons. Affidavit in support of the Originating Summons is not a pleading under the rules of Court on pleadings. With respect, it is not correct to argue that there must be sufficient facts in the affidavit to show that there is a reasonable cause of action. The Applicant's affidavit here is in support of his Originating Summons adding 'flesh' to it when it comes to be argued. See Lewis -v- Parker [1960] 1 WLR 452 where it is pointed out that affidavit in support of an originating summons in not a pleading.

The power to be exercised in such a case as this is discretionary. The court must be satisfied that there is no reasonable cause of action and in this case the onus is on the Respondent to satisfy the court of that. In coming to a decision in this application I have regard to the arguments put before the court by all the parties and the principles as enunciated in the various authorities cited in the course of argument and other authorities which the court have been able to gather.

The court has been most grateful to the Applicant for the numerous authorities that he cited.

Having heard the argument and having considered the authorities and the principles enunciated in those authorities and for the reasons stated in this judgement, the court is not satisfied that the 1st Respondent's application has been made out and I refuse to strike out the Originating Summons in this case.

(G.J.B. Muria)
CHIEF JUSTICE