IN THE COURT OF APPEAL OF
THE REPUBLIC OF VANUATU
(Appellate Jurisdiction)
             
CIVIL APPEAL CASE No.07 of 2002
             
BETWEEN:
             
THE ATTORNEY GENERAL
for the Republic of Vanuatu as the Legal Representative
of the Republic of Vanuatu
Appellant
             
AND:
             
MICHELLE GRAND LIMITED
a Vanuatu Local Company of
P.O. Box 1054, Port-Vila, Efate in the Republic of Vanuatu
Respondent
             
Coram: Justice Bruce Robertson
Justice John von Doussa
Justice Daniel Fatiaki
             
Counsel: Mr. George Nakou for the Appellant
Mr. Garry Blake for the Respondent
             
Hearing date: 25th April 2002
Judgment date: 26th April 2002
             
JUDGMENT
             
This is an appeal against the striking out of the appellant’s counterclaim on the basis that it was out of time and could not be saved by the provisions of Section 14(c) of the             Limitation Act 4 of 1991.
             
This case arises from a claim for the balance of fees owing on a contract entered between the respondent company and the Government of Vanuatu in which the respondent was engaged to provide surveying services to the Government in respect of proposed mini township to be established on the islands of Santo, Malekula and Tanna.
             
The contract was entered into on or about June 1994 between a principal of the respondent company and the then Minister of Lands Mr. Paul Telukluk. In terms of the contract the respondent claimed and received several advance payments between June to August 1994 in respect of the survey works to be carried out.
             
It is common ground that in respect of the works for Santo and Malekula the respondent company has been fully paid. In respect of the works on Tanna however, owing to a change of location mid-survey in June 1995 there was an increase in the original fixed quotation of VT 8 million to a sum of VT11,737,500 of which a sum of VT 8 million has been paid leaving an unpaid balance of VT3,737,500.
             
By letter dated 19th June 1995 the respondent company recorded these changes and the nature and amounts required to be paid in respect of the varied contract. By letter dated 19th August 1995 the respondent company acknowledged receipt of a sum in excess of VT 2 million leaving a balance of VT 3,737,500 for the Tanna mini township survey of the Lenakel/Isangel area.
             
The survey works were completed in or about August 1996 and demand for the balance fee was made without success. Eventually the respondent’s solicitors by letter date 10 February 1999 demanded payment of the balance fee outstanding for the survey work done on Tanna. An invoice was attached.
             
By letter dated 16th April 1999 the then Minister of Lands denied ‘responsibility for actions which led to this debt’ and questioned the correctness of the respondent’s invoice which he suggested ‘was fabricated’ and, in any event, ‘the survey plans are yet to be lodged with the Department of Land Survey.’
             
On 20th March, 2001 the respondent company issued a Specially Endorsed Writ of Summons claiming judgment for the balance fees owing together with interests and costs. The Attorney-General entered an appearance to the action after being threatened with an application for default judgment. It was not however until after being ordered by the Court that a Statement of Defence was eventually filed by the Attorney-General on or about the 7th September 2001.
             
In its Statement of Defence the Attorney-General denies the existence of a valid and enforceable contract and assert that all payments made to the respondent company ‘were issued as result of a mistake’ ………………… as no contract existed with the respondent company the then Minister of Lands did not have the necessary legal authority to enter into a binding agreement.
             
The Statement of Defence further denied that the relevant surveys were completed as claimed and this despite advance payments being made for them. Other than a prayer seeking the dismissal of the action no other relief was sought.
             
At a directions hearing on 14th September 2001 the Attorney-General was ordered to file and serve a proposed counterclaim by 5th October 2001. On 9th October 2001 a Counterclaim was filed and a Defence to counterclaim was filed on 25th November 2001 by the respondent company.
             
In its extensive counterclaim the Attorney General expanded on the matters urged in the Statement of Defence and sought a declaration that the contracts entered into with the respondent company were ‘void ab initio and unenforceable’ and an order for the repayment of all monies paid ‘under the mistaken belief that there were contracts in existence’. Alternatively, repayment was sought on the basis of a breach of contract in respect of the work for Malekula and Tanna or in the further alternative that payments were made under the mistaken belief that would have been performed by the respondent company when no work had been done. Finally, similar orders were sought in respect of the Santo subdivision.
             
In its defence to the counterclaim the respondent company denied the various allegations in the counter-claim and pleaded in bar the provisions of Section 3 of the             Limitation Act 4 of 1991.
             
On 4th December 1991 discovery was ordered by the Court and a further conference hearing was fixed for 5th February 2002. Discovery was accordingly completed by the Attorney-General and on 5th February 2002 a further conference was ordered for 26th February 2002 with a view:
             
‘(to) define and examine the factual and legal issues in the case and in particular the application of the Limitation and exceptions thereto.’
             
The appeal book contains no record of what transpired on 26th             February 2002 or what submissions (if any) were made before the Judge, except for an Order that was made by the Judge, the principal effect of which read:
             
“The counterclaim is dismissed as having been filed outside the period prescribed by the Limitation Act No.4 of 1991 and upon finding that Section 14(c) thereof as relied upon by counsel for the defendant does not apply.” Consequential orders were also made and a trial date fixed for 30th and 31st May. Costs were reserved.
             
The Attorney-General now appeals against the above order by Notice dated 27th March 2002 and advances several grounds of appeal of which it is only necessary to set out the following:
             
“1.                                                                                            That the Primary Judge erred in Law in concluding, without proper evidence being adduced, that the time starts to run from the date of making the contract being sometime on or about 1994 or 1995; and
             
2.                                                                                                         Finding that the expression in Section 3(1) of the Limitation Act No.4 of 1991. “Six years from the date on which the cause of action occurred” to be interpreted as from the date of the contract was made by the parties and not the date in which the breach of the contract occurs.”
             
During the course of the hearing of the appeal some major changes occurred. Counsel for the Attorney-General advised that the allegations contained in paragraph 9, 14 and 17 of the counterclaim were not to be pursued. It also transpires that some of the dates contained in the particulars were in error and some matters arose during 1995 not 1994.
             
The provisions of Section 24 of the Limitation Act No.4 of 1991 mean that although a counterclaim is to be pleaded as a separate cause of action, it is deemed to have been commenced on the date that the initiating proceeding was commenced. The relevant date is March 1995.
             
It is therefore accepted by the respondent that any cause of action which arose after March 1995 was not barred by the provisions of the Limitation Act.
             
It was also accepted that there were factual matters which in terms of Section 14 need to be properly and definitively before the Court so it can be determined if the relief provisions for mistake could be applicable.
             
It was consequently agreed between counsel that the appeal should be allowed and the matter returned to the primary Judge. There are heavy obligations on the appellant to get its papers in proper order and to be clear as to what its case is. That is a matter for the Supreme Court to deal with.
             
Costs of this appeal will be costs in the cause and reserved.
             
DATED at PORT-VILA, this 26th DAY of APRIL, 2002
             
BY THE COURT
             
J.B . ROBERTSON              J
J. von DOUSSA              J
D. FATIAKI                           J