Sino Capital (SI) Ltd v G.B.C Integrated Wood Ltd [2024] SBHC 27; HCSI-CC 659 of 2020 (13 March 2024)

HIGH COURT OF SOLOMON ISLANDS

Case name:	Sino Capital (SI) Ltd v G. B C Integrated Wood Ltd
Citation:
Date of decision:	13 March 2024
Parties:	Sino Capital (SI) Limited v G.B C Integrated Wood Limited, Grace Logging Limited
Date of hearing:	4 July 2023
Court file number(s):	659 of 2020
Jurisdiction:	Civil
Place of delivery:
Judge(s):	Lawry; PJ
On appeal from:
Order:	1. The Claim is struck out. 2. The Claimant is to pay the costs of the First and Second Defendants on the standard basis in accordance with the undertaking given by the Director of the claimant.
Representation:	Ms Y Samuels for the Applicant Mr W Rano for the Respondent
Catchwords:
Words and phrases:
Legislation cited:	Solomon Islands Courts (Civil Procedure) Rule 2007 r 9.75
Cases cited:	Mugihenua Investment Co Ltd v Supreme Resources Company Ltd [2015] SBHC 73, Temotu Pele Shipping Line Ltd v Pele Shipping Co Ltd [2017] SBHC 137

IN THE HIGH COURT OF SOLOMON ISLANDS
CIVIL JURISDICTION

Civil Case No. 659 of 2020

SINO CAPITAL (SI) LIMITED
Claimant

AND:

G. B. C INTEGRATED WOOD LIMITED
First Defendant

AND:

GRACE LOGGING LIMITED
Second Defendant

Date of Hearing: 4 July 2023
Date of Decision: 13 March 2024

Ms Y Samuels for the Applicant
Mr W Rano for the Respondent

Lawry; PJ

RULING

1. The ruling in this matter was prepared shortly after the hearing, however the Court has recently learned that it was not delivered. This is the reason behind the delay in the date of the decision. The Claimant filed the claim on 15 December 2020 and obtained an ex parte interim injunction against the First and Second Defendants.
2. The injunction restrained the Defendants from entering into areas covered by Felling Licence A10762 and directed that the proceeds from exporting logs the Claimant alleged had been extracted from those areas, were to be paid into a joint solicitors trust account , after allowing deductions for royalties and duties.
3. The First Defendant alleges that the logs were extracted from areas within the First Defendants Felling Licence A101747.
4. By letter dated 22 September 2020 the Ministry of Forestry and Research approved the coupes sought in accordance with the timber Rights held by the First Defendant.
5. On 5 December 2020 the Commissioner for Forests suspended Felling Licence A101747. However the Minister of Forests and Research quashed that suspension in a decision given on 11 December 2020. The Minister directed the First Defendant and the Claimant and their respective trustees to file a customary land boundary dispute with the appropriate House of Chiefs.
6. On 15 December 2020 the Guadalcanal Provincial Government directed the Claimant to stop logging, alleging a breach of the law for conducting a logging business in Solomon Islands. It is clear that these matters were not placed before the Court when the Claimant sought the injunction the following day.
7. The First and Second Defendants have filed an application to strike out the claim. The Application relies on rule 9.75 of the Solomon Islands Courts (Civil Procedure) Rule 2007.
8. Rule 9.75 permits the Court to dismiss the proceedings if it appears to the Court that the proceedings are frivolous or vexations or if no reasonable cause of action is disclosed or if the proceedings are an abuse of the process of the Court.
9. Although it seems the proceedings have been commenced following the decision of the Minister to quash the suspension of Felling Licence A101747 and the issuing of the Stop Notice served by the Guadalcanal Provincial Government, the Defendants rely on a more fundamental flaw in the case for the Claimant
10. The Defendants have placed evidence before the Court that was not challenged by Counsel for the Claimant that the Claimant’s foreign investment certificate was cancelled on 26 August 2021 and that the Claimant was removed from the Company Register on 2 May 2022, some 14 months before the application was heard.
11. Counsel for the Claimant placed documents before the Court that on their face were copies of written resolutions by the Directions of the Claimant transferring shares from New Origin Resources Company Limited to a company named Hybrid Resources Limited. Counsel also placed before the Court a share Transfer Agreement between those two companies. Counsel complained that the documents had been filed but not actioned by the Registrar General.
12. Counsel for the Defendants submitted that as the Claimant was no longer registered and no longer able to carry on business in Solomon Islands it could not instruct counsel and in effect ceased to exist. Counsel relied on the decision of Mugihenua Investment Co Ltd v Supreme Resources Company Ltd [2015] SBHC 73 and Temotu Pele Shipping Line Ltd v Pele Shipping Co Ltd [2017] SBHC 137. Both decisions held that a deregistered company is not a legal entity, in effect it ceased to exist.
13. Applying that principle to the present case the Claimant has ceased to exist. It cannot instruct counsel and cannot carry on business in Solomon Islands. There is therefore no Claimant and it follows there can be no claim. There has been no explanation why the resolution of the directors and the transfer of shares might affect that situation.
14. In these circumstances to continue the proceedings would clearly be an abuse of process. The Defendants cannot be left with a claim against then that cannot be prosecuted. The claim is therefore struck out.
15. The Court has enquired about the joint solicitor’s trust account into which the loggers’ share of the proceeds of sale were directed to be paid. Counsel has advised the Court that no funds were paid into a joint trust account as anticipated. This is not a situation where land owners may suffer loss as what was ordered to be paid into the account was only the loggers’ share of the proceeds. No order is therefore necessary in relation to the proceeds of the export of logs.

Orders

1. The Claim is struck out.
2. The Claimant is to pay the costs of the First and Second Defendants on the standard basis in accordance with the undertaking given by the Director of the claimant.

By the Court
Hon. Justice Howard Lawry
Puisne Judge