Hatigeva v Guadalcanal Club Registered Trustees (Incorporated) [2003] SBHC 62; HC-CC 327 of 2002 (13 January 2003)

HIGH COURT OF SOLOMON ISLANDS

Civil Case No: 327 of 2002

WILFRED HATIGEVA

–V-

GUADALCANAL CLUB REGISTERED TRUSTEES (INCORPORATED)

HIGH COURT OF SOLOMON ISLANDS
Muria CJ

Date of Hearing: 09^th January 2003
Date of Judgment: 13^th January 2003

Mr D. Tiqulu for the Plaintiff
Mr G.K. Suri for the Defendant

JUDGMENT

MURIA CJ: The Plaintiff by his interlocutory application comes to this Court seeking an injunctive relief against the defendant following upon a Writ of Summons and a Statement of Claim. The order sought by the Plaintiff in his summons is in the following terms:

“1. That the sum of $50,000.00 out of the proceeds from the sale of Guadalcanal Club held by the Defendant and/or its Solicitor be restrained in an account in the joint name of the Solicitors of the parties until trial and/or further orders of the Court.”.

Paragraphs 2 and 3 of the Summons seek such further and other orders as the Court thinks fit, and costs respectively.

Brief background to the case

The Plaintiff was employed by the Defendant as its Manager under contract of employment on 9^th May 2000 for one year. That contract was renewed on 27^th April 2002 for another year. Following a Special General Meeting on 19^th May 2002, it was decided that the Guadalcanal Club (“the G-Club”) was to be sold and all Staff, including the Plaintiff, were to be made redundant. At its meeting on 10^th June 2002, the Executive Committee of the G-Club agreed that the Plaintiff would be the last to be laid-off-work after he had completed all administrative matters relating to the sale and redundancy exercise. The Plaintiff believed that the G-Club premises was sold for about $2,000,000.00 and proceeds of the sale were held by the Defendant’s solicitor and some trustees. In December 2002, the Plaintiff submitted his claims of entitlements to the defendant following notices by the defendant’s solicitor calling upon creditors, including former employees of the defendant to submit their claims to the office of the defendant’s solicitor by 10^th December 2002. The plaintiff’s claims were rejected and hence, these proceedings.

The Plaintiffs Case

Mr Tiqulu submitted, on behalf of the Plaintiff, that as an employee of the defendant, the plaintiff is entitled to his unpaid wages, redundancy payments and other entitlements. These claims should be paid out from the proceeds of the sale of the G-Club. The plaintiff fears that those proceeds are fast depleting and the only way to obtain any payment, out from them is to restrain the disposition of those proceeds. The limit of the amount he seeks to restrain is $50,000.00, which is obviously to cover his claim of $44,692.08 as stated in his Statement of Claim.

Mr Tiqulu further contends that the defendant and its trustees have held the money in accounts, and if not restrained, it will be dissipated before the trial of the action.

The Defendant’s Case

On the other hand, Mr Suri argues that the Plaintiff is not entitled to an injunctive relief in this case. The defendant, says Counsel, is not refusing to pay to the plaintiff his entitlements, but that there are explanations for not doing so. Primarily, the defendant says that the plaintiff is not entitled to all the matters stated in his Statement of Claim. If the plaintiff were entitled to anything at all, it would have to be only for the period between March and 19^th May 2002. In any case, Counsel adds, the amount of unpaid wages between March and 19^th May 2002 would be insignificant and does not justify protection by a restraining order.

The Law

The principles of law governing injunction in this jurisdiction have been well established following the American Cyanamid Co –v- Ethicon Ltd [1975] UKHL 1; [1975] 2 WLR 316; [1975] 1 A11 ER 503, in a number of cases including Tung Shing Development Ltd –v- Yim Kwok & Others (7/4/95) H.C., cc 66/95; North New Georgia Timber Corporation & Another –v- Sake Hivu and Others (10/2/95) HC, cc 387/93; John Wesley Talasasa –v- Attorney-General & Others (15/5/95) HC, cc 43/95; Allardyce Lumber Company Limited and Dovele Company Limited –v- Nelson Anjo (15/4/97) CA, Civ App. Case No 8/96.

The principles are conveniently grouped under the following headings:

(a) whether there is a serious issue to be tried;
(b) whether damages is an adequate remedy or not; and
(c) where does the balance of convenience lie?

In the present application, however, I feel the Court need not dwell on those considerations other than to acknowledge that the Court bears in mind the salient principles enunciated in the cases cited. The focus on present application is on the need to preserve the assets, namely the proceeds or part thereof of the sale of G-Club so that the plaintiff may have something to hold onto should he succeed at the trial. At least, that is what the Court can glean from the case presented by Mr Tiqulu on behalf of the Plaintiff.

For the purpose of the remedy of an interlocutory injunction, this case falls into a special case where the principles in the American Cyanamid case can be extended to fit the circumstances of the case. Here, there is no dispute as to the facts of the case. The plaintiff was appointed Manager of the Guadalcanal Club owned by the defendant under a contract of employment. He was laid off-work along with the other employees of the Club. He had submitted his claim of entitlements but has not yet been paid. In fact his claim was rejected. Those facts have not been disputed by the defendant who, however, argued that the plaintiff was not entitled to his claims. That is a question of law to be determined on the evidence before the Court.

The case for the plaintiff in this case, is premised on the terms of the contract of employment between the parties, which has not been denied by the defendant. However, in the light of the evidence before the Court and in view of the counter argument by the defendant that the plaintiff is not entitled to his claim, it is incumbent on the plaintiff to show a prima facie case that under the terms of the contract, his claims of entitlement still hold valid. If it is, then ordinarily the defendant should be restrained: John Michael Design plc –v- Cooke [1987] 2 All ER 332. I said “ordinarily”, since the court retains the discretionary power to refuse or call for further steps to be taken by the parties before it can properly exercise its discretion. This is particularly so where the injunctive remedy is sought to preserve an asset, as the present case seeks to do.

The plaintiff seeks to restrain the disposition of the proceeds of the sale of the G-Club held in an account. Unfortunately there are very little details of the proceeds of the sale given by the plaintiff. So for the Court to determine whether to restrain those proceeds, the plaintiff ought to have done more than simply seeking to restrain “proceeds in an account”. The plaintiff should indicate or make the effort to indicate which bank(s) and which branch(es) hold the account(s) sought to be restrained, and if possible, under what account number(s): Z Ltd –v- A & Others [1982] Q B 558. These details are necessary in this case if the Court were to properly determine whether to restrain the proceeds of the sales of the defendant’s club premises or not.

The defendant does not deny that it employed the plaintiff under a contract of employment and as such the parties are bound by the terms of that contract. The terms of that contract are the subject of argument in this action. But prima facie, the Court accepts that ordinarily the defendant should be restrained from disposing of the proceeds of the sale of its G-Club premises. However, the factors required of the plaintiff to show before making such injunctive order must be finished to the Court. This can be done by the plaintiff or by the defendant upon an order from the Court. I feel that in this case, and in order to assist in the speedy hearing of these interlocutory proceedings, this can be done by order from the Court for discovery on affidavit.

Thus I order discovery in this case, in that the defendant file an affidavit deposing to (a) the bank(s) and branch(es) which hold the account containing the proceeds of the sale of the G-Club; (b) the amount for which the Club was sold and (c) the account number(s). In view of the need to quickly resolve this matter, I order that these details be furnished by affidavit within 7 days from today. This application is to be re-listed as soon as possible after that.

Order accordingly.

(Sir John Muria)
Chief Justice