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Prasad v Wati [2022] FJCA 14; ABU090.2020 (4 March 2022)

IN THE COURT OF APPEAL, FIJI
ON APPEAL FROM THE HIGH COURT

CIVIL APPEAL NO. ABU 90 OF 2020
[High Court Civil Action No. HBC 303 of 2019]

BETWEEN:

SHASHI SHALENDRA PRASAD
Appellant

AND:

BHAG WATI
Respondent

Coram: Basnayake, JA
Lecamwasam, JA
Guneratne, JA

Counsel: Mr. E. Maopa for the Appellant
Mr. M. Yunus for the Respondent

Date of Hearing: 24 February 2022

Date of Judgment: 04 March 2022

JUDGMENT

Basnayake, JA

[1] I agree with the reasoning and conclusions arrived at by Lecamwasam JA.

Lecamwasam. JA

[2] This appeal is preferred by the Appellant against the Ruling dated 31 August 2020 made by the Learned High Court Judge at Lautoka. In his Ruling, the Learned Judge has made orders thus:-

1. Application to set aside the default judgment entered on 30^th April 2020 is

dismissed;

2. The Defendant shall pay summarily as costs of $550.00 to the Plaintiff;
   

[3] Having filed the Notice of Appeal, the appellants urged the following grounds of appeal:-

GROUNDS OF APPEAL

1. That the learned Judge erred in law and in fact in considering Order 19 Rule 6 and rule 9 of the High Court Rules (Fiji) 1988 in dismissing the application for setting aside default judgment (refer to paragraphs 16, 17 and 34 last 3 lines of the ruling) where in such Order deals with Default of Pleading specifically for failure of service of defence.
   
2. That the learned Judge erred in law and in fact in failing to consider and proceed under Order 19 Rule 2(1) and (2) which deals with default of defence for liquidated and the mandatory rules under Order 13 rule 1(2) of the High Court Rules (Fiji) 1988. Thus ignoring the rules under Order 13(refer to Order 13 rule 1, rule 2, rule 5 and rule 8 – proof of service of writ).
   
3. That the learned Judge erred in law and in fact when he considered and compared Order 10 rule 1(2) (substitute service) with the service effected by the bailiff by dropping the sealed envelope (containing the writ) addressed to the defendant at his office in front of his staff (refer to paragraph 28 of the judgment).
   
4. That the learned Judge erred in law and in fact when he failed to consider Order 10 rule 1 of the High Court Rules requiring that “A writ must be served personally on each defendant by the plaintiff”. Hence the judgment was irregular.
   
5. That the learned Judge erred in law and in fact when he calculated the period of 14 days to file the statement of defence by the defendant (refer to paragraph 18 of the ruling) wherein the endorsement on the face of the writ of summons normally state the period of 14 days to file an acknowledgement of service stating therein the intention whether to contest then proceeding.
   
6. That the learned trial Judge erred in law and in fact when he failed to consider and/or direct the plaintiff to serve the application to enter judgment to the defendant before delivering the judgment but enter judgment in favour of the plaintiff and without considering the COV 19 lockdown and its effect in Lautoka and nearby areas from mid-March 2020.
   
7. That the learned Judge erred in law and in fact when he failed to consider the affidavit in reply (deposed on 6^th July and filed on 15^th July 2020) by the defendant that the plaintiff had recovered part of the money under the bill of sale and balance of $28, 426.01 is outstanding as evidence in annexure SSP1 in the said affidavit. Hence fail to consider there is a meritorious defence.
   

[4] Before addressing the above grounds of appeal, it is pertinent to set out a concise version of the factual background to the case. Having executed a Bill of Sale dated 12 December 2014, the Respondent (Original Plaintiff), Bhagwati agreed to lend a sum of $41,000.00 to the Appellant (Original Defendant). As per the above Bill of Sale the Appellant agreed to transfer and assign to the Respondent a vehicle taxi business as detailed in the scheduled Bill of Sale.

[5] On the strength of the above document, the Respondent was entitled to take possession of the vehicle and to the profits of the taxi business bearing Permit No. T 2497/26439. The Appellant agreed to pay on demand the above principal sum and any other sum remaining owing to the Respondent. Although the parties agreed upon the above Bill of Sale, the Appellant failed to transfer and assign the vehicle to the Respondent in spite of numerous requests by the Respondent to that effect. In January 2019, the Appellant took possession of the vehicle without the consent of the Respondent, prompting the Respondent to issue a Writ of Summons against the Appellant and claim a sum of $41,000.00 lent under the Bill of Sale be returned to the Respondent. Additionally, the Respondent claimed the following:

1. Loss of income from January 2019 at $100 per day until the final determination of this matter;
2. Damages for the breach of sale; and

100. Cost on an indemnity basis.
     

[6] A Registered Bailiff served the above Writ of Summons on the Appellant and an Affidavit attesting to the service of summons was filed on 4 February 2020. However, the Appellant failed to acknowledge the receipt of the Writ of Summons within the prescribed period of service. Neither has he signed an acknowledgement of service nor a statement of defence as required by law. After taking necessary steps, the Respondent entered the default judgment and sealed Orders against the Appellant on 7 May 2020. The Court granted the reliefs claimed by the Respondent.

[7] The Appellant argued before the High Court that there was no proper service of Writ of Summons on the Appellant. According to the account of the Appellant, the Writ of Summons had been left at the Office of the Appellant with an employee of his. He claims that he was not at the address at which the Summons was served but was away in Suva and therefore, the service of summons does not constitute a proper service.

[8] In the grounds of appeal urged by him, the Appellant takes up the position that the Learned High Court Judge erred in following the procedure set out in Order 19 of the High Court Rules whereas he should have made directions under Order 13. A careful scrutiny of Order 13 and Order 19 of the High Court Rules reveals that the two orders deal with different situations. Order 13 deals with Claims for Liquidated damages while Order 19 deals with default of pleadings.

[9] However, there is common ground in relation to the two Orders. Both deal with a situation in which a Defendant/Plaintiff fails to serve Notice of Intention to defend or a Statement of Claim on the opposite party as the case may be, after the expiration of the period fixed for such steps. Therefore, it is crystal clear that these provisions come into effect only when a party defaults and fails to take a certain action.
[10] In this case the Learned High Court Judge had correctly concluded that the Appellant was in receipt of summons. However, the Appellant has failed to give Notice of Intention to defend after receiving the said summons. Instead, he has decided to pursue the position that the service of summons does not constitute a proper service of summons as the writ must be served personally on the defendant and the alleged service on an employee is defective. I do not observe any deviation from the procedure set out in the High Court Rules in the service of summons and concur with the conclusion of the learned High Court Judge.

[11] The Appellant’s failure to give Notice of Intention to defend is the crucial element which requires closer scrutiny. The Appellant, at a later stage of the proceedings, has taken the position that he was prevented from taking steps due to the Covid-19 situation and resultant lockdowns which prevailed in the area. However, the Respondent, being a person from the same area, had taken necessary action in pursuance of her claim during the same period without any difficulty. Further, the Appellant cannot use the defense of Covid-19 lockdowns because the initial Writ was served on 2 December 2019 as per the bailiff, during which period there was no threat of a pandemic. Therefore, the Appellant cannot take refuge behind the Covid-19 pandemic and I refuse to accept the Appellant’s justification based on the pandemic.

[12] The ground of appeal raised in relation to the amount due, warrants the attention of this Court. The original Plaintiff, Bhagwati had filed the Writ of Summons on 18 November 2019 claiming the relevant orders as per the prayers in the Statement of Claim, the first one being:-

(i) An Order that a sum of $41,000.00 paid under the Bill of Sale by the Plaintiff to the Defendant be returned and other incidental reliefs.

[13] Accordingly, the Respondent by Writ dated 18 November 2019 had claimed $41,000 from the Appellant under the Bill of Sale. The document marked “SSP1” filed by the Appellant becomes important at this juncture. SSP1 was forwarded to the Appellant by Mr. Dorai Sami Naidu of Messrs Pillai and Associates, the Solicitors for the Respondent, the content of which was never disputed. This document reveals that the amount due to the Respondent from the Appellant was only $28,426.01 as at 19 January 2018. Nevertheless, almost two years later, when the Respondent filed the Writ of Summons on 18 November 2019, she has claimed $41,000.00.

[14] The conduct of the Respondent brings into question her bona fides in relation to the claim. As evidenced by her own admission (through her solicitor) in SSP1, the amount due is only $28,426.01, whereas the Respondent has attempted to claim an amount unfairly in excess of the due amount. The Respondent’s own wrongful conduct renders permitting the assertion of a higher amount contrary to good conscience. Therefore, I cannot agree with the default judgment entered by the Learned High Court Judge for a sum of $41,000 as the amount due to the Respondent. However, default judgment is affirmed subject to the variation of the amount on the judgment to $28,426.01 instead of $41,000.00.

[15] In view of the foregoing, I hold that the summons had been properly served. Therefore, the learned Judge’s decision on the service of summons is correct and does not warrant any interference by this court.

Guneratne, JA

[16] I agree with the judgment of Lecamwasam, JA.

The Orders of the Court:

1. Judgment is affirmed subject to the variation stated in paragraph 14.
2. No costs are ordered.
   

Hon. Justice E. Basnayake

Justice of Appeal

Hon. Justice S. Lecamwasam

Justice of Appeal

Hon. Justice J. Guneratne

Justice of Appeal