Islands Construction Management Ltd v Air Transport Ltd [1999] SBHC 22; HCSI-CC 144 of 1996 (12 March 1999)

IN THE HIGH COURT OF SOLOMON ISLANDS

Civil Case No. 144 of 1996

ISLANDS CONSTRUCTION MANAGEMENT LIMITED

-v-

AIR TRANSPORT LIMITED

(PALMER J.)
Civil Case No: 144 of 1996

Hearing: 11th March 1999
Ruling: 12th March 1999

J. G. Katahanas for the Applicant/Defendant
A. Radclyffe for the Respondent/Plaintiff

PALMER J.: Final judgment in this case was given by this Court on 3rd February 1999. It went in favour of the Plaintiff. The Defendant had been ordered by this Court inter alia, to pay the Plaintiff substantial sums of money, amounting to USD37,000.00 and SBD211,520.00 plus interest at 5% with effect from 22nd May 1996.

The Defendant now comes to this Court by summons filed 10th February 1999 for a stay of the Orders of the Court dated 3rd February 1999, inter alia, pending the filing of an appeal and in the event an appeal is filed, the said stay to be continued pending the hearing and the determination of the said appeal.

At the hearing of the summons learned Counsel, Mr. Radclyffe for the Respondent raised a point of objection regarding jurisdiction of this Court to hear the application. This was in view of the specific provisions of the Court of Appeal Rules, in particular Rule 11 which would seem to be the relevant rule to be considered for such applications.

Mr. Katahanas however relies essentially on the inherent jurisdiction of this Court to grant a stay in such applications, although there was mention also of Rule 11 (5) of the Court of Appeal Rules, but as will be seen this was inappropriate in any event. Mr. Katahanas cites in support the case of T. C. Trustees Ltd. v. J. S. Darwen [1969] 2 Q.B. 295, per Lord Denning at page 302, paragraph E:

“It is true that the courts have an inherent jurisdiction to stay proceedings, but only on grounds which are relevant to a stay. It does not extend to grounds which are properly matters of defence of law or relief in equity, for those must be raised in the action itself.”

The issue before this Court is whether it has jurisdiction to deal with an application for a stay pending appeal. I think it is pertinent to point out from the beginning that this is not an application made under the Court of Appeal Rules. Accordingly the provisions referred to under the Court of Appeal Rules have little relevance to this application and the powers of this Court.

The starting point must be the High Court (Civil Procedure) Rules, 1964; in particular Order 45 Rule 19(1). I quote:

“Where a judgment is given or an order made for the payment of money by any person and the Court is satisfied on application made at the time of the judgment or order or at any time thereafter by the judgment debtor or other party liable to execution that there are special circumstances which render it inexpedient to enforce the judgment or order or that the judgment debtor is unable from any cause to pay the money, then, notwithstanding anything in Rule 16, 17 or 18 of this Order, the Curt may by order stay execution of the judgment or order by writ of fieri facias either absolutely or for such period and subject to such conditions as the Court thinks fit.”

This rule is similar to Order 47 Rule 1 of the Rules of the Supreme Court dealt with in T. C. Trustees Ltd (ibid). In that case, Judge Phillimore had granted a stay of execution of the judgment against the Defendant. On appeal the Plaintiff applied to have the stay removed. The Defendant on the other hand sought to rely on Order 47 Rule 1. Lord Denning commenting on the appropriateness of that Rule states:

“I think that is inappropriate here. The circumstances there again are circumstances which go to the enforcement of the judgment: and not those which go to its validity or correctness.”

The analogy which can be drawn from this is that in the circumstances of this case, Order 45 Rule 19(1) of our Rules would also not cover the situation here in that the special circumstances referred therein pertain to the enforcement of the judgment and not where an appeal is pending. But just as in T. C. Trustees Ltd (ibid) Lord Denning concluded that the Court had inherent jurisdiction to order a stay of proceedings I too am prepared to find and accept that this Court does have inherent jurisdiction to order a stay of execution pending appeal. No argument and case authority to the contrary had been suggested and I too have not been able to find any which showed otherwise.

Also indirectly and by a process of deductive reasoning of the case authorities cited to this Court, it would be seen that this inherent jurisdiction is widely recognised by English Courts and the Courts in Australia. In the case Alexander and Others v. Cambridge Credit Corporation Ltd (Receivers appointed) and Another [1985] NSWLR 685, cited by learned Counsel for the Applicant, a decision of the English Court of Appeal, J Lucas (Batteries) Ltd v. Gaedor Ltd [1978] FSR 159; [1978] RPC 389, was referred to, which had held that the correct procedure under the rules for removing a stay once granted in English Courts, was by way of appeal; indirectly recognising the jurisdiction of the lower Court to impose a stay.

Before the New South Wales Court of Appeal, whose President was Kirby J. (also former President of the S. I. Court of Appeal), whilst it recognised the power of the lower Court to impose a stay, pointed out in very clear terms that the Court of Appeal had “... its own jurisdiction, upon motion, to determine whether or not a stay will be granted, regardless of orders made by the court below.”

At page 692, paragraph B the Court states:

“The rule (pt 51, r10) is in ample terms. It does not purport to limit the circumstances in which the Court of Appeal may direct a stay to cases where the trial judge has refused it. The language of the rule is perfectly general. The English rule upon which the decision in J Lucas (Batteries) Ltd is based does not contain the words which appear in the local rule (“except so far as the Court of Appeal may direct”). These words are designed to assure and perserve the jurisdiction of the Court of Appeal. In any event, the decision in J Lucas (Batteries) Ltd is not binding on this Court. In so far as it expresses a different conclusion of principle, it should not be followed. Matters of practice, such as the issue of a stay of execution of a judgment depend very much upon the language of the rules, the view taken concerning the inherent jurisdiction of the court (cf Ellis v. Scott [1964] 2 All ER 987 and the view of the court concerning the efficient and just dispatch of its business.”

I think it should also be pointed out very plainly that whilst it has been established by recognised authority there is inherent jurisdiction to stay execution of its own judgment by a court of first instance, like this Court, our Court of Appeal Rules also make specific provision for stays of execution. It is my respectful view that the views expressed by the New South Wales Court of Appeal are so apposite to our circumstances. That notwithstanding a stay having been obtained in this court, that is no impediment to any party applying to the Registrar of the Court of Appeal under Rule 11 (1) of the Court of Appeal Rules, or to the Court or Judge of Appeal under Rule 11 (5) of the Rules for inter alia, a stay of the proceedings in the lower court.

I am satisfied accordingly this Court has inherent jurisdiction to stay execution of the judgment of 3rd February 1999 pending the filing of an appeal. Once an appeal however is filed it is always open to either party to make application inter alia, for stay, notwithstanding a stay had been granted by this Court. In my respectful view, a stay of execution obtained from this court is useful only in so far as an appeal is yet to be lodged. Once an appeal is filed, the specific provisions of the Court of Appeal Rules come into play, otherwise their existence would become meaningless. In that situation, the inherent jurisdiction of this court would become superfluous and unnecessary.

The case of Warren Paia v. Golden Springs International (IS) Co. Limited and North New Georgia Timber Corporation, Civil Case No. 149 0f 1997, judgment delivered 19th February 1999, was relied on by the Applicant as supporting the argument in favour of the inherent jurisdiction of this Court to stay executions. Unfortunately that does not seem to be so. Although the case was recorded as a High Court case, the power purported to be exercised was that of a Judge of Appeal sitting alone under Rule 11 (5) of the Court of Appeal Rules. Clearly the Court of Appeal Rules cannot be relied on in support of the inherent jurisdiction of this Court. In paragraph 3 of page 1 of his judgment, his Lordship Muria CJ. disclosed that the Defendants had appealed to the Court of Appeal. That must activate the relevant provisions of the Court of Appeal Rules as the relevant rules to be applied in that situation. Compared with this case, an appeal had not yet been lodged; hence the reliance on the inherent jurisdiction of this Court, and rightly so. With respect, any reliance on Rule 11 (5) of the Court of Appeal Rules in this application is misplaced.

Finally, the case of the Prime Minister v. The Governor-General, Civil Appeal Case No. 14 of 1998, judgment delivered on 18th September 1998, was also relied on by the Applicant in support of his submissions on the inherent jurisdiction of this Court. Again unfortunately I find that to be inappropriate. The jurisdiction relied on in that case was that of the Court of Appeal Rules, and rightly so. This time the case was correctly listed as before a single Judge of Appeal to consider the question of a stay under Rule 11 (5) of the Court of Appeal Rules. Again at paragraph 1 of page 1 of the judgment, his Lordship Muria CJ. disclosed that an appeal had been lodged on 15th September 1998 (three days earlier), hence activating the provisions of the Court of Appeal Rules.

I rule accordingly on this preliminary issue that this Court does have inherent jurisdiction to grant a stay pending the filing of an appeal.

THE COURT