Public Service Association Incorporated v Tu'ivakano [2015] TOCA 15; AC5 of 2015 (16 September 2015)

IN THE COURT OF APPEAL OF TONGA

CIVIL JURISDICTION AC 5 of 2015

NUKU'ALOFA REGISTRY [CV 49 of 2014]

BETWEEN:

1. PUBLIC SERVICE ASSOCIATION INCORPORATED
2. MELE 'AMANAKI
Appellants

AND:

1. NOBLE TU'IVAKANO
2. WILLIAM CLIVE EDWARDS
Respondents

Coram : Moore J
Blanchard J
Hansen J
Tupou J

Counsel : Dr. R. Harrison QC SC for the Appellants
Mr. S. Stanton SC &Mr. W. Edwards for the Respondents

Date of Hearing: 14 September 2015
Date of Judgment: 16 September 2015

JUDGMENT OF THE COURT

[1] This is an application for leave to appeal (or an appeal) against a judgment of Scott J of 6 March 2015. In that judgment Scott J dismissed an application for an order removing to the Supreme Court proceedings then on foot in the Magistrate's Court or, alternatively, to stay those proceedings. Generally we will refer in these reasons to the Public Service Association Inc (Tonga PSA) and Mele 'Amanaki as the appellants and these proceedings as the appeal. The proceedings in the Magistrate's Court were defamation proceedings brought by Noble Tu'ivakano and William Clive Edwards (collectively the respondents) against the appellants.

[2] The reason why the appellants both applied for leave to appeal and appealed is that the status of the orders made by Scott J is unclear. If the orders were interlocutory then leave would be necessary; if not the appellants could appeal as of right. In Bienstein v Bienstein [2003] HCA 7 the High Court of Australia had to determine whether an order dismissing an application to remove proceedings to that Court under s.40 the Judiciary Act 1903 (Cth) from another court was interlocutory or not. The Court determined, for reasons given at paras [23] to [29], that the order was interlocutory and leave to appeal was necessary. We agree with those reasons and adopt them. The substance of those reasons was that the dismissal of the removal application did not determine finally the rights of the parties. Accordingly, it is necessary in these proceedings for the appellants to establish why leave to appeal should be granted.

[3] However, we will address the arguments advanced by the parties on the appeal before returning to the question of leave. Scott J appears to have determined the removal or stay application on three grounds. In the order in which those grounds were addressed in the reasons, with extreme brevity, the first was that the application was procedurally irregular in that it was not an application in proceedings already commenced by writ in the Supreme Court or, perhaps, that the wrong form of process was used to make the application. Exactly what Scott J meant is not entirely clear. The second ground was that any application for stay or transfer should be made in the Magistrate's Court being the court seized of the proceedings. The third ground was that the Supreme Court had no jurisdiction to make the orders sought. It is desirable to consider the third ground at the outset. That is because if the Supreme Court does have jurisdiction then the first two grounds are of no or little moment. If the Supreme Court can remove proceedings on foot in the Magistrate's Court then it could not be that the removal application necessarily had to be made in proceedings commenced by writ in the Supreme Court nor would it be necessary to apply for a transfer or stay in the Magistrate's Court. If the criticism of Scott J was that the wrong form was used, the Court should have waived compliance with the rules.

[4] There is no provision to which we were referred or of which we are aware in the Constitution of the Kingdom, the Supreme Court Act, the Magistrate's Court Act or other statute which, in terms, expressly confers power on the Supreme Court to make an order removing a proceedings from the Magistrate's Court or staying proceedings in that court.

[5] However such provisions do exist in other jurisdictions at least in relation to removal. They serve an important function in the distribution and redistribution of matters between courts in a judicial hierarchy where courts higher in the judicial hierarchy (recognized in Tonga by clause 84 of the Constitution) are likely to deal with cases and issues of greater complexity or importance than courts lower in the judicial hierarchy. This is exemplified by s.40 of the Australian Judiciary Act referred to earlier. That provision enables the removal of proceedings to the High Court from another court lower in the judicial hierarchy by order of the High Court if the proceedings raise a constitutional issue. Initially this was the sole basis on which proceedings could be removed to the High Court. However in 1996, s.40 was amended to empower the High Court to remove proceedings more generally and not simply because they raised a constitutional issue.The statutory test in relation to removal of proceedings which do not raise a constitutional issue, in the absence of consent of the parties, is that the High Court is satisfied that it is appropriate to make the removal order having regard to all the circumstances, including the interests of the parties and the public interest.

[6] In O'Toole v Charles David Pty Ltd [1990] HCA 44; (1990) 96 ALR 1 Mason CJ addressed the purpose of the removal power at para [13]:

The procedure for removal into this Court under s.40 of the Judiciary Act 1903 (Cth), which is designed to ensure that constitutional questions and other questions of public importance are determined by this Court, enables it to reconsider preliminary questions of law decided by the Full Court of the Federal Court, even though the decision of that Court is not the subject of an appeal and may not be appealable. Indeed, it verges on the ludicrous to suggest that the very purpose of removal may be frustrated simply because the cause removed has proceeded to the point at which an unappealable order has been made. It is no answer to this argument to say that an appeal will lie when the court below makes a determination resolving the rights in suit. That may take a long time and involve great expense. The object s.40 was to secure early resolution of constitutional questions and other issues of public importance.

[7] Similar provisions have existed in the United Kingdom since at least 1984 under the County Courts Act 1984 (UK) enabling, amongst other things, the High Court to order the removal of proceedings commenced in a county court: see s.41(1). In such a case, the application would be made to the High Court who would then make the removal order or, as it is described in the section, the transfer order.

[8] In Chaplin v Lotus (Court of Appeal, Bingham MR, Rose and Waite LJJ, unreported 17 December 1993) Sir Thomas Bingham, the then Master of the Rolls, discussed the jurisdiction of the Patents County Court and the question of transfers but also referred to s.41(1). Bingham MR said:

The High Court and County Courts Jurisdiction Order 1991 governs the allocation of cases as between the High Court and the county court. Very broadly speaking, claims valued at less than £25,000 are to be tried in a county court and claims for more than £50,000 in the High Court. But these fixed limits are subject to Article 7(5) of the Order, which provides: "The High Court and the county courts, when considering whether to exercise their powers under section 40(2), 41(1) or 42(2) of the County Courts Act 1984 (Transfer) shall have regard to the following criteria—(a) the financial substance of the action, including the value of any counterclaim,(b) whether the action is otherwise important and, in particular, whether it raises questions of importance to persons who are not parties or questions of general public interest,(c) the complexity of the facts, legal issues, remedies or procedures involved, and(d) whether transfer is likely to result in a more speedy trial of the action, but no transfer shall be made on the grounds of subparagraph(d) alone.

Read together, as they should be, these provisions indicate, to my mind quite clearly, how the discretion to transfer should be exercised by the judge of the Patents County Court. He is to have regard to the financial position of the parties. He is not obliged to transfer if it is shown that the proceedings are likely to raise an important question of fact or law. But subject to those rules he should bear in mind that the Patents County Court was established to handle the smaller, shorter, less complex, less important, lower value actions. It was to provide cheaper, speedier and more informal procedures to ensure that small and medium sized enterprises, and private individuals, were not deterred from innovation by the potential cost of litigation to safeguard their rights. Subject to the rules referred to, longer, heavier, more complex, more important and more valuable actions continue to belong in the High Court. Ultimately, as with any exercise of discretion, the decision must turn on what the interests of justice are judged to require: that means taking account not only of the interests of the plaintiff who wants to pursue his action in the Patents County Court but also the interests of the defendant who wants to have his liability determined in the High Court.

[9] Section 41(1) illustrates how a provision can operate to confer on a court higher in the judicial hierarchy a power to remove into that court proceedings commenced in a court lower in the judicial hierarchy. However the provision has greater significance than that in these proceedings.

[10] Section 5(1) of the Supreme Court Act declares that the powers of the Supreme Court shall include, mutatis mutandis, all the powers for the time being vested in or capable of being exercised by the High Court of Justice in England and Wales. Notwithstanding the creation of a single County Court effective 22 April 2014 by the Crimes and Courts Act 2013 (UK), section 41(1) continues to vest in the High Court a power to remove proceedings from the County Court. The expression "mutatis mutandis" in s.5 of the Supreme Court Act requires necessary changes to be made to the legislation or other instruments in the United Kingdom vesting powers in the High Court in order to render them applicable to the circumstances in the Kingdom of Tonga. In our opinion, section 41 (1) can and should be applied to the Supreme Court by adapting the provision so as to empower the Supreme Court to remove proceedings from the court immediately below it in the judicial hierarchy, namely the Magistrate's Court.

[11] Accordingly, we are satisfied that the Supreme Court did have power, by reference to s.5, to make an order removing the proceedings from the Magistrate's Court to the Supreme Court. Scott J was in error in concluding he did not have the power to do so. We should add that we consider it is likely that this power will be rarely and sparingly used.

[12] This jurisdictional question concerning removal in this case is an important legal question arising in proceedings that appear to relate to an incident or incidents of high political controversy concerning the payment of significant funds granted to the Kingdom of Tonga by the People's Republic of China. It is appropriate that leave to appeal be given. We grant leave.

[13] Thus it is necessary for the Court of Appeal to address the merits of the appellants' application, though the focus of our consideration is the removal application which, we apprehend, was the primary method advanced by the appellants of dealing with the proceedings in the Magistrate's Court. Scott J did not address the merits of the application. However the judge did make some observations in his reasons that bear upon the merits.

[14] The proceedings in the Magistrate's Court are defamation proceedings by each of the respondents against the appellants. They were commenced in May 2014. The defamation alleged by each of the respondents related, as noted earlier, to the disbursement of significant aid funds paid to the Kingdom of Tonga by the People's Republic of China. As alleged, the amount involved is US$25,450,000 that the Kingdom of Tonga has paid to the Friendly Islands Satellite Communications Limited trading as Tongasat. The appellants took the position that the payment of these funds to Tongasat was unlawful. In the pleadings in the Magistrate's Court, the respondents as plaintiffs (the first respondent was the Prime Minister at the time of the payment to Tongasat and the second respondent was then the Minister of Justice) each allege they were defamed in either press releases of the Tonga PSA or in correspondence. As appears from the pleadings, a material element is that the plaintiffs were said to have been involved in illegal conduct, namely the payment of the funds. The appellants say these proceedings will be defended on, inter alia, the ground of justification. If so, that defence is likely to raise the question of whether the payment of the funds was illegal.

[15] In proceedings commenced in July 2014 by the Tonga PSA and Samiuela 'Akilisi Pohiva (the current Prime Minister) in the Supreme Court against the Kingdom of Tonga, the Attorney-General and Tongasat, orders are sought requiring the repayment of the US$25,450,000 or damages in an equivalent sum. Those proceedings raise, directly, the lawfulness of the payment of the funds. They became matter CV 48 of 2014.

[16] There are other proceedings in the Supreme Court arising from the same substratum of facts but it is, for present purposes, only necessary to discuss the defamation proceedings and the proceedings that became CV 48 of 2014. Of these proceedings Scott J said in his judgment in the removal application at para [17]:

Having read the Respondents' claims in the Magistrates Court as "fairly" as I can, I have no doubt that the unlawfulness or otherwise of the payments to Tongasat, if not already determined elsewhere, would inevitably fall for consideration. I also agree with [the applicants' counsel] that the Magistrates' Court is not at all suitable for an enquiry into that alleged unlawfulness.

[17] We agree. The issue of the lawfulness of the payment is an extremely important and potentially difficult legal issue and involves the public interest. It is an issue that the Supreme Court will be far better placed to address. In our view it is in the interests of the administration of justice to remove the defamation proceedings from the Magistrate's Court to the Supreme Court to enable the Supreme Court to deal with that issue. It will be a matter for the Supreme Court to case manage both the defamation proceedings and CV 48 of 2015 (and, if relevant, other proceedings in the Supreme Court) and, as part of that process, determine when and how the legal issue concerning the alleged unlawfulness of the payment of the US$25,450,000 to Tongasat is determined. It will also be a matter for the Supreme Court to make such procedural orders and directions as it thinks necessary or desirable to constitute the defamation proceedings in the Supreme Court in a way conformable with the Supreme Court Rules.

[18] Accordingly, we propose to make orders removing the defamation proceedings from the Magistrate's Court to the Supreme Court. The appellants are entitled to the costs of the application for leave to appeal and the appeal.

[19] The Court orders that:

1. Proceedings Case No 87 of 2014 in the Magistrate's Court is removed to the Supreme Court.
   
2. Proceedings Case No 95 of 2014 in the Magistrate's Court is removed to the Supreme Court.
   
3. The respondents to the application for leave to appeal and the appeal pay the applicants/appellants the costs of the application and of the appeal as agreed or taxed.
   

Moore J

Blanchard J

Hansen J

Tupou J