Delthurst Pty Ltd (In Liquidation) v Bokissa Investments Ltd [2003] VUSC 33; Civil Case 184 of 2002 (1 July 2003)

IN THE SUPREME COURT
OF THE REPUBLIC OF VANUATU
(Civil Jurisdiction)

Civil Case No. 184 of 2002

BETWEEN:

DELTHURST PTY LTD.
(IN LIQUIDATION)
Plaintiff

AND:

BOKISSA INVESTMENTS LTD.
Defendant

RULING ON APPLICATION FOR SUMMARY JUDGMENT
(Rule 9.6 CPR)

The hearing of this application took place at the same time as the one in CC182/02. The same general remarks apply.

The claim was filed on 7^th November 2002. An amended defence and set-off were filed on 21^st March 2003. This application was filed on 28^th March.

The claimant alleges breach of a "Quistclose Trust" or repayment of a debt. The claimant says the defendant admits the transfer of the funds but "denies the party and denies liability". It was the intention of both parties the funds were to be held "in an express trust" by the defendant for the benefit of the claimant with the primary purpose of being used to enable the claimant to continue to trade, failing which the funds were to be repaid to the claimant, being a secondary purpose of the trust. The claimant says the directing minds of both claimant and defendant at the time in question were the same. Any other interpretation of the facts and reasons for the transactions would fall into the realm of a fraud upon creditors given the fact the transfer was made on 14^th June 2001 and voluntary administrators were appointed on 18^th June.

The defendant resists the application. It says the claimant relies heavily upon the transcripts of the proceedings in Australia which are inadmissible in Vanuatu. The defendant has no access to most of the relevant material. That was seized by the liquidators and some is not now available. There is apparently the same set-off in this case as is alluded to in 182/02, namely for AUD$958,467. That is pleaded in this case.

I have the sworn statements as set out in CC182/02, which have been read in, and the sworn statement of Peter Anthony Lucas (filed 28^th March 2003), and Allan Cort (22^nd April 2003-2).

The claimants case relies upon what was said in creditors meetings and proceedings in Australia. I have not made any ruling in CC182 of 2002. However, the claimants do not rely upon the recording of proceedings itself but upon what their witnesses heard being said by David Cort and Janice Cort in those proceedings and elsewhere. No rule or authority has been cited to me which curtails the use in this Court of things said in such proceedings or elsewhere as alleged, when there is direct evidence thereof.

Further, given the timing of the making of the payment it is difficult to see how it could be made for another purpose which did not necessarily raise questions of fraud upon creditors.

The second sworn statement of Alan Harold Cort, relied upon by the defendants at paragraph 2 is at best inconsistent within itself, and one part positively assists the plaintiffs. The first sworn statement of Alan Cort contains a document, Annex B, which he says supports his claim to a set-off.

Again both parties proceeded on the basis that the plaintiff was R.A.C.E. Services Ltd. (In liquidation) and not "Delthurst Pty Ltd. (In Liquidation)" as requested for the Ruling of 12^th May. I see no prejudice in amending the name of the claimant accordingly.

Does the law of Vanuatu recognise a Quistclose Trust? Have the claimants shown one existed in this case for the purposes of a summary judgment ? No authorities have been cited. Barclays Bank Ltd. v. Quistclose Investments Ltd. is a 1970 case (1970 AC 567). The law of Vanuatu since Independence has looked to principles of common law and equity where no provision is made in the Constitution and statute law, there is no inconsistency and there is applicability to Vanuatu, particularly taking into account custom law. I can see no reason why the principle enunciated in the Quistclose case should not apply in Vanuatu.

Did one arise in this case? The intention of the guiding minds of the two companies is clear on the face of the claimants documents. The money was transferred, in effect, "to keep the business going" in the short term. R.A.C.E. services ceased trading very soon afterwards.

I give summary judgment for the plaintiff in the sum of AUD$100,000 together with interest at a rate to be determined, together with costs.

Dated at Port Vila, this 1^st day of July 2003.

R. J. COVENTRY
Judge.