Solomon Islands National Provident Fund Board v Peseika [2013] SBHC 31; HCSI-CC 355 of 2008 (2 April 2013)

IN THE HIGH COURT OF SOLOMON ISLANDS
(Mwanesalua J)

Civil Case No. 355 of 2008

BETWEEN:

SOLOMON ISLANDS NATIONAL PROVIDENT
FUND BOARD
Claimant

AND:

GAKEI PESEIKA
Defendant

Hearing : 25 February 2013
Ruling : 2 April 2013

K. Levi for the Claimant
B. Hiele for the Defendant

RULING

[1] This is an application by the Defendant filed on 18 October 2012 for Orders that: (1) the default judgment by the court on 19 August 2009 be set aside and (2) in the alternative, these proceedings be stayed until such time as the Defendant repays the loan in full.

[2] The Claimant is set up by Law[1] to, among other things, administer a fund made from monthly contributions from employers in respect of their employees who are members of the Claimant. These employees are eligible to obtain loans from the member's urban Housing Scheme established by the Claimant to assist members purchase or build their own residential houses in urban centres. The Defendant is one of such members.

[3] The Defendant obtained a loan from the Claimant on 24 February 1999. He built his house on Parcel Number 191-019-52 at Mbokonavera in Honiara. The amount of the loan is $118,000.00. It is repayable at the rate of $975.00 per month within a period of 20 years. The interest payable on it is 6% per annum.

[4] By 2008 the Defendant was considerably in debt in his repayments. So on 20 October 2008, the Claimant filed a claim against the Defendant to recover the arrears. The claim was served on the Defendant on 24 October 2008. On 6 November 2008, counsel for the Defendant filed response and made an undertaking that defence would be filed within 28 days. No defence was filed when that period lapsed. The Claimant then went to court and sought default judgment to be entered against the Defendant. The court granted: 1. Default judgment be entered against the Defendant in the sum of $171,582.82 with interest of 6 percent per annum from 18 July 2008 until payment in full; 2. The Claimant is empowered to sell by public tender the Defendant's property on parcel no. 191-019-52; and 3. The Defendant pays the costs of and incidental to this proceeding".

[5] The Claimant advertised the fixed term estate in parcel number 191-019-52 for sale in the Solomon Star newspaper pursuant to paragraph 2 of the default judgment, on 4 May 2012, 11 May 2012, 18 May 2012 and 25 May 2012. The tender was closed on 31 May 2012 after eleven bids were received. The management of the Claimant then met and decided that three separate buyers were eligible to purchase the property. They were placed in first, second and third preferences to purchase the property.

[6] The Defendant gave reasons in his sworn statement in support of his application to have the default judgment set aside. First, he claims that he was committed to fully repay his loan. The court does not fully accept this, because if he has been repaying his loan as required, he would not be in debt with his loan. The next reason he advanced was that his counsel did not file defence in time which led to the default judgment being entered against him. This is correct, while his Counsel made an undertaking to file a defence within 28 days, no defence was filed. The other reason raised by the Defendant is that by October 2012, his outstanding loan only stood at $119,496.86. In response to this assertion, the Claimant says that by October 2012, the loan stood at $121,364.70. The Claimant may be correct on that, it seem to be in line with the Defendant's Loan Statement, see Exhibit "JTL4" attached to the sworn statement of Ms Lakoa.

[7] The Defendant disputes the outstanding Loan amount of $171,582.82 entered against him in the default judgment on 19 August 2009. He says that his outstanding loan at the date of the default judgment was $151,232.39. There is a difference of $20,350.43 in the amounts given by the Claimant and the Defendant on the amount of the outstanding loan.

[8] The Court notes that from 2012 the Defendant has been making real effort to repay his loan. This is reflected in his loan statement for 2012. The Court does not have a copy of the Defendant's loan statement for 2013.

[9] Having read the sworn statements filed by the parties and hearing submissions by their Counsels, the court would exercise its discretion to set aside the default judgment. Order accordingly.

THE COURT

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^[1]Solomon Islands National Provident Fund (Cap 109)