Newman v Ah Tong [2007] VUSC 102; Civil Case 41 of 2007 (13 November 2007)

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

Civil Case No. 41 of 2007

BETWEEN:

RON NEWMAN & OTHERS
Claimant

AND:

GEORGE LEUNG AH TONG
First Defendant

AND:

MOUMOU AH TONG
Second Defendant

Coram: Justice Tuohy

Counsels: Claimant in person
Mr. Malcolm for Defendants

Date of Conference: 28 August 2007
Date of Decision: 13 November 2007

RULING OF
C.N. TUOHYJ

1. This is an application by the Defendant to strike out the claim on the basis that it is frivolous and vexatious and there is no reasonable cause of action. The jurisdiction for such an application was recognized by the Court of Appeal in Noel v. Champagne Beach Working Committee [2006] VUCA 18; CAC 24/06 (6 October 2006).

2. The principles on which the jurisdiction should be exercised are well established, having been stated in Noel v. Champagne Beach Working Committee in a passage approved by the Court of Appeal in Iririki Island Holdings v. Ascension Ltd [2007] VUCA 13, CAC 35 of 2007 (24 August 2007):

"Although, as this Court pointed out in Kalses v. Le Manganese de Vate Ltd [2005] VUCA 2, Civil Appeal Case 34 of 2003 (3 May 2005), there is no specific provision in the Civil Procedure Rules to strike out a proceeding on the grounds that there is no reasonable cause of action or that it is frivolous, vexatious or an abuse of process, it was not disputed that such a power exists. Jurisdiction can be found within the broad terms of ss.28 (1)(b) and 65 (1) of the Judicial Services and Courts Act 2000 No. 54 of 2000 and the Civil Procedure Rules themselves provide in Rules 1.2 and 1.7 a basis for exercising the jurisdiction. In practice the existence of such an inherent jurisdiction has been assumed by the Supreme Court: see e.g. the judgments of Treston J in Naflak Teufi v. Kalsakau [2004] VUSC 94; Civil Case 102 of 2002 (6 May 2004) and Kalomtak Wiwi Family v. Minister of Lands [2004] VUSC 47, Civil Case 14 of 2004 (2 September 2004). However it has always been recognized that the jurisdiction should be exercised sparingly and only in a clear case where the Court is satisfied it has the requisite material; the claimant’s case must be so clearly untenable that it cannot possibly succeed: Electricity Corp Ltd v. Geotherm Energy Ltd [1992] 2 NZLR 641."

3. The Claimant is not represented by a lawyer ad it is obvious that the claim was not drafted by a lawyer. However, the essence of it is clear. The Claimant claims a total of VT 15 billion which he says is the amount now owing on a loan of 1,249,151 francs made by his late father Oscar Newman to the Defendants in September 1978 which has never been repaid. Oscar Newman died in 1979. The claim was filed on or about 10 April 2007.

4. The Defendants have not filed a formal defence but their application is based on 3 specific grounds:

- that the claim is statute-barred

- the Rules

- the sworn statement filed

5. The sworn statement of the First Defendant in support states that in September 1978 Oscar Newman guaranteed a loan he took out with the Bank of Indochine but the loan was repaid and the guarantee not called on. In his solicitor’s letter exhibited, he denied ever receiving a loan from Oscar Newman. However, for the purposes of this strike out application, it must be assumed that the allegations of fact made by the Claimant are true, namely that the loan was made in September 1978, that it should have been repaid not much later but that it never has been.

6. In his submissions, Mr. Malcolm relied on 2 main points: first, he said that the Claimant, not being the personal representative of his father, Oscar Newman, has no standing to bring this claim. Secondly, he submitted that it was more than 2 decades out of time.

7. The claim is that the loan was repayable to the late Oscar Newman. The only person who can bring a claim is his personal representative. The claim does not allege that the Claimant, his son Rony, is the executor or administrator of his estate. The Claimant gave the Court a copy of a letter addressed "To Whom it may concern" dated 27 January 1990. This letter is signed by his brother A.J. (Alec) Newman. It states that the writer is a trustee of the estate of Oscar Edwin Newman and that the estate had been settled with the exception of compensation for land and improvements at Banana Bay and Lamap. It authorizes the beneficiaries of the estate and in particular Messrs Ron, Marco, Eric, Allan or Brian Newman to negotiate on behalf of Estate O. E. Newman for the return of personal property and for compensation for the improvements to the properties in question.

8. The law of Vanuatu relating to the administration of estates of deceased persons is contained in Queen’s Regulation 7 of 1972. (There may also be residual French law applicable under Article 95 (2) of the Constitution but the will of the late Oscar Newman is in English and it is assumed that the British law will apply to it). Section 19 of Queen’s Regulation 7 provides that in all proceedings concerning the estate of a deceased person, his personal representative, so long as such remains vested in him, shall represent such estate. However, s. 18 (1) provides that a personal representative may at any time, by leave of the Court, relinquish his office to such person as the Court may appoint.

9. While at present the named Claimant Rony has no standing to bring the claim, it is possible for him to obtain standing, provided the personal representative(s) agree. The letter shown to the Court indicates that they may very well agree.

10. In those circumstances, the Court would not strike out the claim solely on the basis of lack of standing because it is quite possible that that problem could be cured.

11. The limitation point is a different matter. There is no doubt that this is a claim based on contract, namely a loan contract. Section 3 (1) of the Limitation Act 1991 is clear: an action founded on contract shall not be brought after the expiration of 6 years from the date on which the cause of action accrued. The cause of action on a loan contract accrues when the loan becomes due and owing – in this case, on the claimant’s own pleading, a couple of weeks after the loan was made in September 1978. On any view, the time for bringing this claim expired in 1984, more than 20 years ago.

12. There is however an allegation in Paragraph 13 of the Claim that "on or about August 2005 I asked two policeman Mr. George Tommy George Richard and another to go and ask Mr. Ah Tong to come to the police station for a conference. He (the First Defendant) gave VT 50,000 to them to give it to me".

13. There is a provision in the Limitation Act for an extension of the limitation period in cases where there has been a part payment of a debt. Section 11 (3) provides:

"(3) Where any right of action has accrued to recover any debt or other liquidated pecuniary claim, or any claim to the personal estate of a deceased person or to any share interest therein, and the person liable or accountable therefore acknowledges the claim or makes any payment in respect thereof, the right shall be deemed to have accrued on and not before the date of the acknowledgment or the last payment:

Provided that a payment of a part of the rent or interest due at any time shall not extend the period for claiming the remainder then due, but any payment of interest shall be treated as a payment in respect of that principal debt".

14. The claim does not allege that this payment of VT 50,000 was a part payment of the debt but, if it was, then time will have started to run again in August 2005 and this claim would not be out of time. The Court is conscious that the Claimant is not a lawyer and the Court would not wish to see his claim struck out simply because it has not been properly pleaded. That would not be in accordance with the overriding objective of the Civil Procedure Rules set out in R 1.2, that is "to enable the Courts to deal with cases justly".

15. However, even if it might be possible for the Claimant to re-plead his case on this point, he still faces the problem that at present he has no standing to bring the claim. In those circumstances, it would be wrong for the Court to allow him to continue it unless and until he becomes entitled to do so. A stay order is appropriate.

16. There will therefore be an order staying this proceeding until further order of the Court. The stay order may be lifted if and when the Claimant can demonstrate to the Court that he is the legal personal representative of the Estate of Oscar Newman or until the personal representatives of the Estate themselves are substituted as Claimants. In that event, it will be necessary for an amended claim to be filed setting out exactly when it is alleged that the cause of action arose.

17. It is necessary also to refer to the Claimant’s argument that custom is part of the law of Vanuatu and that it does not recognize any limitation of time when a debt is owing. The place of custom in the law of Vanuatu is referred to in Article 95 (3) which says:
    

"Customary law shall continue to have effect as part of the law of the Republic of Vanuatu".

18. However the Claimant has chosen in this proceeding to obtain a resolution using the State law system rather than through the customary law system administered by the Chiefs in the nakamal. This Court must apply the rules of the State law system which include any relevant laws passed by the Parliament of Vanuatu such as the Limitation Act 1991.

19. The application to strike out is dismissed but there will be an order staying this proceeding until further order of the Court. Neither party has been wholly successful on this application, so it is appropriate that costs lies where they fall.

Dated at Port Vila, this 13th day of November 2007

BY THE COURT

C.N. TUOHY
Judge