Kikile v Kalahaki Ltd [2017] SBHC 37; HCSI-CC 431 of 2007 (19 October 2017)

IN THE HIGH COURT SOLOMON ISLANDS

(Faukona, PJ)

CIVIL CASE NO. 431 OF 2007

BETWEEN: DANIEL KIKILE AND JACK HANIGARO Claimant

AND: KALAHAKI LIMITED First Defendant

AND: ORGANIC EARTH COMPNAY LTD Second Defendant

AND: ATTORNEY-GENERAL Third
(Representing the Commissioner of Forest) Defendant

Date of Hearing: 6^th September 2017

Date of Ruling: 19^th October 2017

Mr. M. Tagini for the Claimants/Judgment Creditors
Mr. J. Sullivan QC and Mr S.Lepe for Enforcement Debtors, Defendant (1) and (2)
Mr. A. Hou for Third Party/Applicant

RULING ON APPLICATION TO SET ASIDE RENEWAL OF ENFORCEMENT ORDER

Faukona, PJ: There are two applications on foot. One by the first and second Defendants to set aside the enforcement order made by the Registrar of the High Court on ex-parte basis on 2^nd June 2016.

2.	The second application was filed by the 3rd Party on 12th June 2017 to struck out the sworn statement filed by Mr Pelu Haelo (former Registrar of Titles).
3.	It was agreed on the out-set that the application by the first and second Defendants should go first. If successful, then the impact will affect the application by the 3rd Party which should succeed as well. Simply put, that the 3rd Party’s application will be considered should the first and second Defendants’ application fails.
4.	On 5th December 2008 a default judgment was entered against the Defendants pursuant to a self-executing order.
5.	On 1st August 2011 damages were assessed for conversion at USD474, 230.34 and for trespass at SBD953, 965.00.
6.	On 17th April 2012 an order for enforcement hearing was granted. On 11th December 2012 was the first renewal of the enforcement order. However it was stayed on 28th October 2013.
7.	On 24th March 2016 the order for stay was varied and enforcement hearing was permitted to proceed.
8.	On 2nd June 2016 the enforcement order was renewed by the Registrar of the High Court by way of ex-parte application. This was followed by a notice of seizure issued by the Sheriff on 27th September 2016. On 27th October 2016 under Direction Orders the execution was stayed.
9.	Mr Sullivan QC submits that seizure notice ultra vires the Sheriff and the enforcement order ultra-vines the Registrar. Mr Sullivan QC further admonishes that both decisions are ultra-vines for reasons that they were decided contrary to the requirements under the rules, more specifically Chapter 21 of the Rules. The relevant provisions of the rules refer to will be discussed later.
	Seizure notice by the Sheriff:
10.	The judgment of the Court on 24th March 2016 permitted the Claimants to proceed with the enforcement hearing.
11.	What appeared to be permission, upon which the claimants relied on to file an ex-parte application resulted in the Registrar then ordered the second renewal of the enforcement order. The Sheriff then enforced the order by seizure notice directed to seize of PN 192-010-68 (the Land) which stated is owned by the debtor, but did not state which particular debtor owns the land.
12.	In fact the owners of the fixed term estate are Lee Hook, Lau Khing Hung and Chieng Hock Joon (3rd Party) as joint owners.
13.	On the date of renewal of the second enforcement order (2nd June 2016), Mr Chieng Le Hook was one of the Directors and Shareholder of the third Defendant and was current. The 3rd Party replaced Goh Keng Boo as a registered joint owner in November 2015. The Commissioner of Lands holds the PE title.
14.	Under Rule 21.56, the Sheriff may only seize property which an enforcement debtor has legal or beneficial interest.
15. 16.	The legal interest in FTE is held by 3 individuals. One of them is Mr Chieng Lee Hook who is a Director and shareholder of the second Defendant. However, as a separate entity the first and the second Defendants do not have interest in the FTE, neither do they have beneficial interest in. The test for beneficial interest is whether it can be enforced in equity. S.117(2) of the Land and Titles Act clearly states that in the absence of a written instrument signed by or on behalf of the party charged, there can be no enforcement unless there has been part performance of an oral agreement. Therefore the seizure was conducted in contravention of Rule 21.56, the property seized was not in the interest of the enforcement debtors.
17.	Again R21.59 states that property to be seized must be listed in the order and must be safely stored. That cannot be said that a general authority to seize a property of the enforcement debtor is not a list of property contemplated in accordance with the rules. In deed there was no property listed in the enforcement order at all.
18.	Further Rules 21.102 to 21.107 provide special rules when enforcement creditor wish to enforce money judgment against land can do so, but only after ensuring the rights of all other parties interested have been accommodated.
19.	In my view the enforcement order is not a charging order. There was no charging clause, but an order made under R21.12, a renewal provision. Only enforcement debtor’s legal or equitable interest can be charged.
20.	Under R21.103 the joint owners are required to be personally served, it is mandatory and any material supporting the application require proof of service. There was nothing done in this case.
21.	Rule 21.100 prohibits an enforcement creditor from taking any steps to enforce the order against land until at least 3 months after the last service under R21.103.
22.	The enforcement order was renewed on 2nd June 2016, and seizure notice is dated 27th September 2016. All interested parties including joint owners would have to be personally served not later than 27th June 2016. There is no evidence of such service.
	Enforcement order by the Registrar:
23.	By Rule 21.11 Enforcement order remain in force for one year, unless the order states it ends at an earlier date. And Rule 21.12 states an order may be renewed for further period of one year. That must be done by way of application for renewal and it must be made before the order ends by filing a request for the order to be renewed for a stated period not longer than one year. There must be a sworn statement setting out matters to be included supporting the application for enforcement order and the reason why the order was not enforced during the period, see Rule 21.13.
24.	In this case the initial order which lasted for one year expired on 28th September 2012. The first renewal was expired on 11th December 2013.
25.	Under Rule 21.13(a) it is mandatory that application for renewal be made before enforcement order expires, that is before 11th December 2013. In this case a draft order was filed on 2nd June 2016. That is more than five months late. It is a clear breach of Rule 21.13(a).
26.	Likewise there was no sworn statement filed in support of the application as required by Rule 21.13(b) (1) and (11). There was no application for extension of time and it is now more than late to grant an enforcement, it is barred.
27.	The other ground upon which the first and second Defendants rely on is the fact that the renewal was done on ex-parte basis and not supported by any sworn statement. That verily is true and there is no order from Court permitting or granting leave for the application be heard on ex-parte basis. Again that is contrary to R 21.14.
28.	For the purpose of this application those grounds are sufficient to consider. There are two other grounds but I think it sufficient that those had identified breaches against the Rules by both the Registrar and the Sheriff..
29.	Having said that, the Counsel for the claimants has made no submissions in regards to the non-compliance with the rules. His submissions seemed to confine to the fact that the application for enforcement order was authorised by the decision of this Court, of which no appeal was lodged against. He further submits that by instituting this application is one way of continue delaying the enforcement of a judgment which the Claimants are entitled to enjoy the fruit of it.
30.	I noted the decision of the Chiefs has two effects. One, it may have some adverse effect on the original judgment giving rise to the money judgment after assessment. Secondly, it is still open for the Claimants to refer a case to the Local Court. In any event the original judgment was made within the timber rights processes. The ownership issue is yet to be finalised.
31.	In considering the material matters before me, I have no doubt that the enforcement order made by the Registrar followed by the seizure notice are all contravene the appropriate rules and they are fatal breaches. They must therefore be ultra-vires and of no effect. With the application by the first and the second Defendants successful, the 3rd Party now benefits and not necessary to consider his application.
	Orders:
	1.	The order of the Registrar made ex-parte on 2nd June 2016, renewing the enforcement order on 5th September 2011 and subsequently renewed on 19th December 2012 be set aside.
	2.	Refuse to grant order prayed for in the second relief.
	3.	Refuse to grant order prayed for in third relief.
	4.	Order that seizure notice based upon the renewed enforcement order including the Seizure Notice on 27th September 2016 directed to seizure PN: 192-010.68 be set aside and the property be returned to the FTE holders.
	5.	The Claimants/Enforcement Creditors pay the first and second Defendants/Enforcement Debtors costs of an incidental to application with certification for Queens Counsel.
	The Court.