Samlinsan (SI) Ltd v Pacific Crest Enterprises Ltd [2016] SBHC 131; HCSI-CC 69 of 2016 (28 July 2016)

IN THE HIGH COURT OF SOLOMON ISLANDS
Civil Jurisdiction
(Maina J)

Civil Case No. 69 of 2016

BETWEEN: SAMLINSAN (SI) LTD - 1^st Claimant/Respondent

AND: MUGIHENUA INVESTMENT CO. LTD - 2^nd Claimant/Respondent

AND: PACIFIC CREST ENTERPRISES LTD - 1^st Defendant/Applicant

AND: SUPREME RESOURCES CO. LTD - 2^nd Defendant/Applicant

Date of Ruling: 28^th June 2016
Date of Judgment: 28^th July 2016

Mr. W Rano for Applicant/Claimant
Mr D. Marahare for 1^st & 2^nd Defendant/Applicant

JUDGMENT

Maina PJ:

Introduction

This is an application to strike out the proceeding in the matter pursuant to rule 9.75 (a) (c) of the Court Rules 2007 and consequent upon that hereof, discharging the injunctive obtained on ex parte for the first and second claimants against the Defendants on 27^th February 2016.

Brief Background

On 27^th February 2016 the claimants obtained ex parte order restraining the defendants to conduct logging operation on or entering Isles Tropical Concession and Kugua/Magautu concession on Rennell Island. The orders also restrained the Defendant to remove logs already fell and stored in the bush or log pond and not hauled or loaded on to any vessel, until further orders

The interlocutory order was perfected however or later the counsel for the claimant submitted another draft copy orders for perfection but was refused as it did not coherent with the orders in their original draft orders which was endorsed when granting the orders.

In response to the injunctive orders, the Defendants on 12^th April 2016 filed an application for orders to set aside the injunctive orders in pursuance to Rules 17.55 (a) to (c) of the Court Rules 2007. However, on 15^th June 2016 the Defendant filed an Amended Application under Rule 9.75 of the Court Rules with Certificate of Urgency.

With the Amended Application, the Defendants sought eight orders and in principal to set aside the ex-parte orders in its entirety or alternatively be varied. The proceeding be dismiss on the ground of the first defendant has no standing, the fact an injunctive order was obtained by ex parte and the Defendants holds a felling licence no A101426 covering the concession area.

And in the event the orders sought is refused then varying order to export or allowing forthwith the export and shipment of logs felled by the first defendant.

From the documents before the court and from the applicant’s submission it seems that when the defendants filed the amended application they have not been served with the claim filed on 25^th May 2016. And it was so as confirmed by the counsels at the hearing of this application.

The issues

This application is made under Rule 9.75 of the Court Rules and the court is to check if there the proceedings are frivolous or vexatious; or no reasonable cause of action is disclosed; or the proceedings are an abuse of the process of the court. It is upon that the court may make orders appropriate in the case or whether the claim is to be strike out at this stage of the proceeding and or summary judgment be entered.

As such or on that, the issue is whether or not the claimant has an arguable case?

It is important to note the legal principles governing interlocutory orders or interim restraining orders that the applicant must show that there is a serious issue to be tried, damages would not be an adequate remedy, the balance of convenience favours the granting of the interim orders sought and; the applicant has given the usual undertaking as to damages.

Serious Issues

The claim by the claimant is that first defendant is not entitled in law to execute a Standard Logging Agreement with the Trustees of Teatubai and Mugaulaga as it is not the applicant to acquire timber rights. It has interest in the lands and has some association with the second defendant.

Counsel for the Defendant submits that this claim was filed in the name of the first and second claimant but the second Claimant has filed a notice to discontinue or withdrawn the interest and involvement with the First claimant. A notice to discontinue on their part in this case was filed by Counsel Nelson Laurere. And according to the defendant that notice to discontinue makes the First claimant has no standing in this claim.

It is also noted in his submission that there is no immediate Report(s) Forestry Department forming part of the evidence before this court confirming that the first and second applicants felling operation outside the concession area affected by felling licence no. A101426 and held by them. And there is no clear evidence confirming the first claimant has direct legitimate interest over the Kagua/Magautu, Tebaipuke, Magaulagu and Teátubai customary lands. He argued that without the second Claimant, the first Claimant has no standing to institute proceeding over the any of the lands.

For the court strike out a case on application under rule 9.75 of the Rules it is well settled in this jurisdiction and the leading case is Tikana v Motui (2002) SBHC and notable approved in the case Saógthatoga v Mugaba Atoll Resources Company (2015) SBCA4 by the Court of Appeal. In Tikana v Motui, Palmer CJ said the jurisdiction given to the court on these grounds is to be sparingly used and only in exceptional cases (Lawrence v. Lord Norrys [1890] UKLawRpAC 14; (1890) 15 App. Cas. 210 and be exercised only where the claim is devoid of all merit or cannot possibly succeed (Willis v. Earl Beauchamp (1886). And he approved the test by Lush J in the case, Norman v. Mathews (1916) 85 L.J.KB 857:

"In order to bring a case within the description it is not sufficient merely to say that the Plaintiff has no cause of action. It must appear that his alleged cause of action is one which on the face of it is clearly one which no reasonable person could properly treat as bona fide, and content that he had a grievance which he was entitled to bring before the Court."

It seems notable from the claim by the claimant that there is a serious legal issue which relates to the acquisition timber rights the Kagua/Magautu, Tebaipuke, Magaulagu and Teátubai customary lands with the standing issue and whether the first claimant has direct legitimate interest over the lands.

I am therefore satisfied there are triable issues that were disclosed for the granting of the interim orders.

Whether the damages are adequate remedy

This is a case where two logging companies are arguing over logging rights. It is not a case for the protection of land and environment from the effect of logging. I am satisfied that any damages would be taken care of or adequate remedy.

Balance of Convenience

I examined the submissions and sworn statements by the parties and the balance of convenience favour the maintaining of the status quo. And briefly it is so as both parties are not landowners and are arguing over right to contacting logging operation which all the parties claim interests on the land areas named in the sworn statements and documents. It will another question if both parties are determined at the trial that they do not have legal rights.

Again the claimant is a logging company and for damages they are capable to compensate or where damages are done that would be adequate remedy.

Undertaking as to damages

As noted above these are logging companies and are capable to compensate for damages.

The case

There appears to be arguable case. The claim is that first defendant is not entitled to execute a Standard Logging Agreement with the Trustees as it is not the applicant to acquire timber rights, the standing, issues relate to Forestry Department concerning felling operation of the concession area by felling licence no. A101426. And or there appears to be a serious legal issue which relates to the acquisition of timber rights at the Kagua/Magautu, Tebaipuke, Magaulagu and Teátubai customary lands and whether the first claimant has direct legitimate interest over the lands.

I looked at the sworn statements and Defendants/applicant’s submission and noted facts or reference to material facts or evidences for trial. Defendant is to show that there is no arguable case that deserves this claimant’s case proceeding to continue.

As allude earlier there is arguable case and issues that would be properly dealt with at the trial. Therefore the amended application to strike out the claim is refused.

The Defendants sought as an alternative remedy to export the logs already fell should the application to strike out is unsuccessful or the interim injunction is not set aside. There are logs felled by the defendant before the injunctive orders. Those logs must be preserved and be used at its usefulness and therefore the ex parte order made by this court on 27^th February 2016 is varied and the defendants to export and shipment of logs felled by the First and second defendant pursuant to felling no. A101426.

ORDERS

1. The amended application filed on 15^th June 2016 to dismiss the claim on the ground of standing and related matters is refused and dismissed;
   
2. The ex parte orders perfected on 27^th February 2016 shall continue until trial or further orders of the court.
   
3. The defendants to export and shipment of logs felled by the First and second defendant pursuant to felling no. A101426 and all the moneys after the deduction of the Government taxes to be deposited in the joint account held by counsels for claimant and defendants.
   
4. Matter is listed for mention on 25^th August 2016
   
5. Cost is reserved.
   

THE COURT

.................................................................
Justice Leonard R Maina
Puisne Judge