National Provident Fund Board v Maetoloa [1997] SBHC 114; HCSI-CC 171 of 1997 (8 December 1997)

IN THE HIGH COURT OF SOLOMON ISLANDS

Civil Case No. 171 of 1997

NATIONAL PROVIDENT FUND BOARD

-v-

FRED MAETOLOA

High Court of Solomon Islands
(Muria, CJ.)
Civil Case No. 171 of 1997

Hearing: 20 November 1997
Summary Judgment: 8 December 1997

A. Rose for the Plaintiff
C. Ashley for the Defendant

MURIA CJ: The Plaintiff Board has brought this application seeking summary judgment against the defendant on the basis that the defendant had been in arrears over the repayment of his loan. The total amount owing as rent in arrears is $76,873.05.

The defendant obtained a loan of $47,000.00 from the plaintiff on 1 July 1992. Among the terms of the loan were that the plaintiff shall have registered charge over the defendant’s property registered Parcel No. 191-016-37; there shall be charged 12.5% interest per annum on the loan and that the repayment was $620.00 per month. The loan was repayable over a period of 20 years. Should there be default of repayment of the loan for a period of 3 months, the plaintiff’s policy is to take foreclosure action against the defaulter.

The defendant has been said to be in default as of 30 April 1997 in the sum of $76,873.05. It would appear that on the plaintiff’s record the defendant’s had not made repayment since early 1995, a period of about 30 months in total arrears. During most of that period the defendant was in New Zealand studying. In his letter to the plaintiff on 23 January 1997 the defendant explained the reasons for the arrears. Part of the reasons for the arrears was that there had been some misunderstanding by his banker with the repayment arrangement. Upon finding out about the arrears, he made arrangement to increase his loan repayment to $1,000.00 per month starting at the end of January 1997. That had been done and the plaintiff accepted the repayment of $1,000.00 per month since then.

In addition to the increased repayment of $1,000.00, the defendant and his wife have pledged to make further increase in the repayment arrangement which included renting out the premises and have the rental money paid to the plaintiff.

The defendant claimed that he had made repayment to the plaintiff in the sum of $17,515.00 between February 1994 and October 1997. Despite that, the plaintiff still insists on proceeding with its legal action against him.

The plaintiff’s application is brought pursuant to 0.14, r.1 (a) of the High Court (Civil Procedure) Rules 1964 which provides as follows:

“0.14, r.1(a) Where the defendant appears to a writ of summons specially indorsed with or accompanied by a statement of claim under Order 3, Rule 5, the plaintiff may on affidavit made by himself or by any other person who can swear positively to the facts, verifying the cause of action and the amount claimed (if any liquidated sum ins claimed), and stating that in his belief there is no defence to the action except as to the amount of damages claimed, if any, apply to the Court for liberty to enter judgment for such remedy or relief as upon the statement of claim the plaintiff may be entitled to. The Court thereupon, unless the defendant shall satisfy the Court that he has a good defence to the action on the merits or shall disclose such facts as may be deemed sufficient to entitled him to defend the action generally, may make an order empowering the plaintiff to enter such judgment as may be just, having regard to the nature of the remedy or relief claimed.”

That rule gives this Court the power to order judgment to be entered against the defendant summarily upon application by the plaintiff. Before making the application! the plaintiff must ensure: firstly, the writ of summons together with the Statement of Claim have been served on the defendant; secondly, the defendant has entered an appearance; and thirdly, an affidavit in support must accompany the application verifying the facts relied upon and stating that to the deponent’s belief there is no defence to the action or part thereof in respect of which the application is made. It will be noted that the power of the Court to order summary judgment is discretionary which the court will exercise after hearing the defendant on the question of whether he has a good defence to the action or not.

In principle, the Court can direct entry of judgment where there is evidence of the facts on which the claim or part thereof is based and that there is evidence that led to the belief that there is no defence to the claim or part thereof except as to the amount of damages claimed (if any).

The claim by the plaintiff in this case is the sum of $76,873.05 as arrears in loan repayment up to 30 April 1997. To that claim, the defendant wrote a letter to the plaintiff on 23 January 1997 in which the fact of being in arrears was not disputed. In fact the defendant agreed that with such an amount, he would not be able even to repay one quarter of it. However he disputes the actual amount in arrears. He said it was much less than what the plaintiff claimed. In my view judgment may be entered upon admission by the defendant whether in the pleadings or not. But for judgment to be entered under 0.14 r. (a) based on the defendant’s admission, such admission must be strong and unequivocal. However even where there is such admission, there is a serious question of fact or law to be considered, the court can refuse to enter judgment and allow the defendant to defend the action.

In my judgment the letter from the defendant of 23 January 1997, although not denying being in arrears, clearly raised a serious question of fact for consideration. That question is to do with the amount claimed by the plaintiff against the defendant. For the main issue in this case is the amount in arrears and not the fact of being in arrears itself. The defendant is seriously raising a dispute to the amount of the arrears as evidence in his Defence filed on 20 November 1997. That is a serious issue of fact central to the plaintiff’s claim in this case and since it is denied, it must be established.

There is also an issue of law raised in the defendant’s Defence and that is on the question of estoppel. The defendant raised this issue based on his claim (so far with no denial from the plaintiff) that he has been paying the arrears at $1,000.00 per month and accepted by the plaintiff. The defendant’s contention is that the plaintiff is estopped from taking further action against him. Again this is a serious legal issue for consideration by the court.

In the circumstances I feel that the defendant has satisfied the court that the matters he raised have sufficiently entitled him to defend the action. In this regard I grant the defendant leave to file his defence out of time for the purpose of defending this action.

Application by the plaintiff for summary judgment is refused.

(GJB Muria)
CHIEF JUSTICE