Civil Case No. 276995
MICHAEL DE GOOD
align="center" ter" str" style="margin-top: 1; margin-bottom: 1">
v
STAR HARBOUR
TIMBER COMPANY LIMITED
tyle="margin-tgin-top:-top: 1; margin-bottom: 1">Before: Sam Awich (Commissioner)
Hearing: 5 February 1996
Judgment: 7 February 1996
Counsel: J.C. Corrin for Plaintiff;
A. Radclyffe for
the Defendant
SAM AWICH:
The plaintiff, Michael De Good instituted proceedings
against the defendant, Star Harbour Timber Company
Limited,
by originating summons dated 15th September
1995, filed the same day, seeking six declarations in the
main and
two in the alternative. The declarations may be
summarised for the purpose of this judgment to three,
namely:
1. Whether the fact that the plaintiff wrote two
letters, on 18.10.1997 exhibit MD1, and on 17.11.1987
exhibit
MD2, to Messrs Henan Cahill & Stone who
had interviewed him for employment, suggesting that
he was
recruited and that certain terms were agreed,
and the fact that he reported at work in Solomon
Islands,
and carried out some work of Sollumber
Limited, constituted contract of employment between
Sollumber Limited
and the plaintiff.
2.Whether the defendant, by taking over some
business interests of Sollumber Limited and obtaining
Certificate
of Approval under the Foreign Investment
Act, 1984, exhibit MD6, allowing it, a company owned
by foreigners, to do business in Solomon Islands, and
accepting
conditions therein that included paying
sums owed to creditors and employees of Sollumber
Limited, the
defendant acknowledged its own
indebtedness for the plaintiffs' wages and liable to
pay the plaintiff.
3. Whether when, at the instigation of the Foreign
Investment Board, the defendant whose shareholders
had
changed, subsequently paid off some creditors of
Sollumber Limited, and also wrote to the plaintiff a
letter
dated 21.11.1994 exhibit MD14 accepting to pay
his wage if the plaintiff provided, "at least
the original
letter of employment", the
defendant acknowledged its own indebtedness for the
plaintiff's wages and
is liable to pay.
The defendant filed summons raising a preliminary
point. In the summons the defendant sought to have the
originating
summons dismissed, "on the grounds that
the Plaintiff's claim (sic) are statute barred by, virtue
of the provisions
of the Limitation Act, 1984". He
did not cite the particular provisions nor did he specify
them during submission. In response, learned
counsel
Corrin for the plaintiff said that she would
concede that if the plaintiff were to sue his employer,
the suit would be statute
barred. She, however, contended
that this suit, brought by originating summons, was not
against the employer of
the plaintiff for unpaid sums
being renumeration for employment of the plaintiff. She
named the employer as Sollumber
Limited, though the
plaintiff's affidavit suggests someone else, Rantex
Limited.
On the other hand, learned counsel Mr. Radclyffe
submitted that the plaintiff's claims, however cloaked,
are for
sums of money alleged owing as wages and other
entitlement of alleged employment and was, "statute
barred".
I take it that counsel's submission is
based on section 5 as read with section 17 of the Act
which provide:
"15. Except as otherwise provided in this
Act, no action shall be brought, nor any arbitration
shall commence,
after the expiration of six years
from the date on which the cause of action
accrued".
"17. Subject to the other provisions of
this Act, cause of action shall be deemed to accrue
on the
date on which the tight to relief by an action
first arises:
Provided that where the cause of action is
founded on a continuing wrong, afresh cause of action
shall be
deemed to accrue on each day the wrong
continues ".
A question of prescription of time to sue under the
Limitation Act, must necessarily invite the question;
what the cause of action is. Different provisions
regarding computation
of time lapse apply to different
causes of action. In this case the importance is that if
the cause of action is
unpaid remuneration on a contract
of employment then in terms of sections 5 and 17, the
suit is prescribed/barred
after 6 years. That was
conceded. As I understood her, counsel for
plaintiff urged the court to hold that the plaintiff's
case is based on acknowledgments
by the defendant and
that the acknowledgments alone, not the alleged
employment, founded the liability of the defendant
to
pay. She intimated to the possibility of a deed in favour
of the plaintiff. She might have meant a deed of
assignment, but she did not pursue that.
Submission of counsel Corrin, extended would be that
if the liability of the defendant is identified as
arising
from acknowledgments then the claims have been
brought within time for bringing suit of this nature, the
acknowledgments
having been made on or about 18.4.1990
when Certificate of Approval was granted, and on
21.11.1994, when the defendant
wrote to the plaintiff
accepting to pay if original letter of employment was
provided. I also took it to be counsel's
submission that
if acknowledgments were accepted then by section 30 of
the Limitation Act, "fresh causes of action to
recover", the debt, being remuneration for
employment, "accrues",
from the dates of the
acknowledgments being 18.4.1990 and 21.11.1994.
The relevant parts of section 30 read:
"30 (1) where after the accrual of cause
of action but before the expiry of the prescribed
period..
(a) . . . . . . .
(b) . . . . . . .
(c) a person liable for any debt or
other liquidated pecuniary claim or accountable for
any claim to the personal
estate of a deceased person
or to any share or interest in such estate,
acknowledges such debt or claim,
a fresh cause of
action to recover such . . . debt or claim, as the
case may be, shall accrue to the person
in whose
favour such acknowledgment has been made ".
From the above, it can be seen that the difficulty
with that submission of counsel is that it runs counter
to the
central proposition of counsel, it presupposes
that there was an earlier debt for remuneration from
employment,
owed by the defendant itself. It has been
stated clearly by counsel that it is not the plaintiff's
case that the
defendant in the beginning owed the remuneration claimed. The acceptance to pay, said to be
acknowledgment, is therefore
not sufficient
acknowledgment for the purpose of section 30 so as to
cause fresh cause of action to accrue with
the result
that more than 6 years will elapse before the suit is
time barred. That submission must fail.
The first submission of Ms Corrin is rather complex.
She urged court to hold that the defendant became liable
simply
by having accepted to pay the debt owed by the
employer whose business interest the defendant has now
taken over.
She submitted that the acceptances made in a
letter and certificate were acknowledgments upon which
the plaintiff
is entitled to sue on without the need to
prove previous debt. When the court put a question to
counsel as to whether
by coming to court by way of
originating summons under 0 58 r 1 the plaintiff was
claiming on a "written instrument",
her answer
was yes. Asked what the instrument was, she stated that
they were the letters of the plaintiff seeking
to confirm
his employment, and of the defendant agreeing to pay on
condition and further more, the Certificate
of Approval
to do business in Solomon Islands. It is the court's view
that the letters written by the plaintiff
to Messrs
Honan, Cahill and Stone about him having been
interviewed, offered employment and certain terms would
only be used to prove contract of employment. That
employment ceased in August 1989 and payment of
remuneration
failed then and earlier. That is some 6
years and 3 months before this case was filed on
6.11.1995. I have already
dealt with the question as to
whether the letter of the defendant, accepting to pay on
condition that original
letter of employment is provided,
is acknowledgment in terms of section 30 so as to cause
fresh cause of action
to accrue. It is not. The complex
part of the submission of counsel for the plaintiff is
the general question as
to when in law, acknowledgment
gives rise to liability. In English common law which is
applicable in Solomon Islands,
acknowledgment generally
founds liability deriving from the principle of law
described as money had and received
to the use of the
plaintiff. A suit to claim under that principle is a suit
for restitution of that money. Some
writers describe it
as obligation in quasi contract. To prove acknowledgment
in the principle of money had and
received to the use of
the plaintiff, it must be shown that a third person has
given instruction to defendant,
the holder of the money,
to pay to the plaintiff, the transferee, and the holder
has accepted the instruction and
promised the transferee
that he would pay. The money of course would be money
that belonged to the third person
giving instruction or
money that has accrued or may accrue to him in the hands
of the holder, the defendant, It
is therefore not a claim
by the plaintiff based on contract as strictly speaking,
the plaintiff is not privy to
the contract and has given
no consideration. That is why it is often referred to as
obligation in quasi contract.
The case that clarified the
uncertainty and clarified the rule is Griffin v Weatherby
(1868) LR 753. See also Walker v Rostron [1842] EngR 154; (1842)
9 M&W 411. The plaintiff's case before court now,
does not prove any of the facts required for liability
for money had and
received to the use of the transferee.
There is no proof that the defendant holds money of or
accruing to the original
employer, whether that be
Sollumber Limited or Rantex Limited nor that the employer
instructed payment to the plaintiff,
would be transferee,
and the defendant has promised to so pay.
The nearest case to this one that I came across is
Shamia -v- Joory (1958) 1 QB 448. In that case,
the defendant owed a third person, the brother of the
plaintiff, 1300 pounds as remuneration for services
rendered. The third person requested the defendant to pay
to the plaintiff 500 pounds out of the 1300 pounds. The
defendant sent a cheque which was not met because of
irregularity. The defendant promised to send corrected
cheque back to the plaintiff, but failed. Barry J. field
for the plaintiff. He referred to the judgment of
Blackburn J in Griffin's case as authority. He said that
there was no need that there be a sum of money identified
in the hands of the defendant.
It would suffice if there
was in his hand or accruing, a sum of money or monetary
liability. In this case there
was simply no sum of money
accruing nor instruction to pay. The letter written by
the defendant, dated 21.11.1994
was not shown to be a
promise based on instruction to the defendant to pay the
plaintiff. It is not sufficient
acknowledgment to found
suit for money had and received to the use of the
plaintiff. It does not amount to a cause
of action and
therefore has no accrual date for computation under
section 5 and 17 of Limitation Act.
The third document that the plaintiff sought to rely
on is the Certificate of Approval, for foreigner to do
business
in Solomon Island issued to the defendant. In it
condition 9.2 provided for payment of debts owed to local
creditors
and employees of Sollumber Limited. In addition
the plaintiff relied on the fact that the defendant paid
off some
creditors. Counsel submitted that the
Certificate of Approval was a contract, but that the
plaintiff would not
be privy to the contract. It appears
to me that the Certificate is in the nature of a licence.
Should the defendant
breach conditions such as 9.2, the
consequence would appear to be cancellation of the
certificate rather than enforcing
payment to creditors
and employees. The plaintiff is simply unable to sue on
the certificate as evidencing a contract.
To the
submission that it is a simple acknowledgment in terms of
section 30 of Limitation Act, so as to extend the
prescribed period, I adopt the reasons I have given for
rejecting any legal consequences in
favour of the
plaintiff in regard to the letter written by the
defendant agreeing to pay if the plaintiff provided
original letter of employment. It also is not
acknowledgement in the principle of money had and
received
to the use of the plaintiff, so as to be cause
of action upon which to sue. Its date is irrelevant in
computing
prescription period. The issuing of the
certificate and the acceptance by the defendant of
condition 9.2 therein
does not bring this suit within the
prescribed period.
It would appear that under section 39 of the
Limitation Act, the court is empowered to exercise
discretion to allow action to proceed if it appears to
the court that it would
be equitable to do so. Learned
counsel Mr. Radclyffe did not draw attention of the court
to it, nor did learned
counsel Corrin. May be it was not
the plaintiff's case that conditions for the exercise of
court's discretion exist
in this case. Whether it will be
equitable for the court to condone the delay is
determined by prejudice likely
to be occasioned to the
plaintiff or to the defendant. Factors to be taken into
account are enumerated in the section
and cover many
situations, they include the length of, and reason for
delay, the effect of delay on evidence, the
conduct of
the defendant, his response to demand and disability of
the plaintiff to bring action. The section seems
to
emphasise that in acting under this section, the court
shall have regard to all the circumstances of the case.
An important case in the exercise of discretion is Donovan
v Gwentoys Limited (1990) ALL ER 1018 .
All that I have said in the previous paragraph
regarding section 39 is obita. It is the court's ruling
that the
suit by the plaintiff, notwithstanding the form
in which it is presented, is time barred under sections 5
and 17
of Limitation Act, 1984. The court, not having
been invited to exercise discretion to condone the delay
resulting in the prescribed period
being exceeded, must
dismiss the suit by authority of section 37 of the Act.
Date signesigned this 7th day of February, 1996, at
Honiara.
Sam Awich
mmissioner of the High Court
