IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION
CIVIL ACTION NO. 957 OF 1982
:
SUVA CITY COUNCIL
Plaintiff
AND:
K.W. MARCH LIMITED
a limited liability company having its
registered office at 71-81 Marks Street, Suva
Defendant
R. Gopal for the Plaintiff
H.M. Patel for the Defendant
Dates of Hearing: 8th, 9th, 10th July, 19th August 1996
Date of Judgment: 15th May 1997
JUDGMENT
On the 30th of Alast His Honour Justice Clie Clifford Wallace former Chief Judge of the United States Court of Appeal (9th Circuit)
gave a talk to members of the judiciary and legal profession on recent developments in Judicial Administration. His Honour spoke
about the long delays which occur in litigation in this country and certain overseas countries including New Zealand and India and
of the steps which he suggested should be taken to reduce these delays, as they have now been reduced in the United States.
His Honour gave as an example of most glaring delay a civil suit in India which had taken 20 years to come on for trial. That in any
body's language amounts to inordinate delay and must be considered as something of a record although the history of this case would
surely run it a close second.
The action is a claim by the Plaintiff against the Defendant for rates alleged to be owing to the Council by the Defendant since 1985.
According to Mr. Edmund March, the Managing Director of the Defendant, the claim dates back as far as 1965 since when the Defendant
and the Plaintiff have been in dispute as to the amount of rates owing by the Defendant.
The Writ was issued on the 11th of November 1982 by the Plaintiff's former solicitors Wm Scott & Co. claiming the sum of $14,781.32
for rates and interest due for the years 1978 to 1982. The Defendant denied liability to pay this amount on the ground that particulars
of rates which had been supplied to the Defendant were inaccurate and that in any event the Defendant was not liable to pay any interest
to the Plaintiff. The Statement of Defence concluded by alleging that the Statement of Claim did not disclose any cause of action.
The case then proceeded with relative speed during 1983 and 1984 and on a Summons for Directions before the then Registrar of this
Court Mr. M.D. Scott, now Mr. Justice Scott, it was set down for hearing within 60 days.
A Book of Pleadings was filed on the 22nd of August 1985 and on the 28th of November 1985 new solicitors were appointed to act for
the Plaintiff. Thereafter the Plaintiff was given leave to deliver an Amended Statement of Claim by Mr. Justice Rooney on the 25th
of July 1986.
In the Amended Statement of Claim the Plaintiff alleged that the Defendant had not paid arrears of municipal rates from 1980 to 1986
and it claimed the sum of $28,237.65 together with interest at the rate of 11% p.a. under the Local Government Act Cap. 125.
The amended defence was delivered on the 15th of August 1986 in which the Defendant claimed that it had been unable to ascertain the
correct position of the accounts between it and the Plaintiff and that the Plaintiff had miscalculated interest allegedly owing by
the Defendant.
An application was then made by the Plaintiff for leave to administer interrogatories for the examination of the Defendant which objected
to leave being granted after which, apparently, the application was never pursued.
The case was fixed for hearing on the 17th of September 1987 before Mr. Justice Sheehan who was informed by the parties that settlement
was imminent and His Lordship therefore adjourned the case presumably to allow settlement talks to proceed.
Such talks were not successful and it was re-fixed for hearing before Mr. Justice Palmer on the 22nd of March 1989 during which time
of course the second military coup had occurred in Fiji.
On the 22nd of March 1989 the Plaintiff had changed its solicitors and Mr. Subhas Parshotam requested an adjournment to enable him
to prepare the Plaintiff's case. It was adjourned for mention on 28th of April, Mr. Justice Palmer noting that counsel expected to
agree on the figures so that only a point of law would be argued when the hearing resumed.
On the 26th of May 1989 the case came before me in Chambers when I adjourned it to the Chief Registrar's list to fix a date for hearing.
During the ensuing four years the Plaintiff had acquired its own solicitor and on the 15th of March 1993 Notice of Intention to proceed
was given by the Plaintiff.
A pre-trial conference was held on the 26th of May 1993 when it was agreed that the issues would remain as stated in the Pleadings.
On the 7th of December 1993 I then fixed it for hearing on the 14th of June 1994 when I was informed that the parties were trying
to settle and to enable talks to proceed I re-fixed it for hearing on 21st and 22nd February 1995 and gave leave for a further Amended
Statement of Claim and Defence to be delivered.
This was duly done but in the further Amended Statement of Claim the amount claimed by the Plaintiff had risen considerably to $96,446.81
together with interest thereon at the rate of 11% p.a. from the 1st of January 1995 till the date of settlement in full. The interest
claimed is the statutory rate allowed in Section 78 of the Local Government Act on all overdue rates.
A further Amended Statement of Defence was delivered on the 22nd of March 1995 in which the Defendant denied owing any amount to the
Plaintiff. It also alleged that the Plaintiff so far had not been able to produce for the Defendant a true and accurate amount of
rates if any owed by the Defendant which requested this Court to order an inquiry into the Plaintiff's accounts concerning the property
known as C.T. No. 6167 in Suva on which the rates have been levied. The Defendant denied the right of the Plaintiff to compound charge
or claim interest on an incorrect amount of rates alleged to be owing by the Defendant.
On the 19th of April 1995 the case was re-fixed for hearing on the 28th of November 1995 on which date it was adjourned for mention
on the 12th of December. I was then told that the parties would try to settle the matter in the ensuing fortnight.
Apparently further settlement talks took place but to no avail because on the 31st of January 1996 counsel for the Plaintiff informed
me that the Plaintiff had passed a resolution to proceed in Court with its claim.
The recitation of this history to me indicates at least one thing, namely that had the various judges including myself who heard the
various applications I have recorded been able to take a more active part in the settlement process on the lines recommended by Mr.
Justice Wallace, conceivably the parties may have eventually been able to resolve their differences or at least reached some compromise.
At the moment such judicial intervention is not permitted in this country.
At the trial the parties called only one witness each. For the Plaintiff Joseph Sang the Rates Officer of the Plaintiff testified
that he had been the Rates Officer from October 1993 and that his main duty was to see that records of rates are kept in order in
accordance with the Local Government Act. He tendered a Reconciliation Statement of rates owing to the Council by the Defendant from
1979 until 1995. The Reconciliation Statement gives details of the rate struck each year, any adjustment made, all payments made
by the Defendant and the interest charged by the Plaintiff on each outstanding balance.
After proceeding for some two hours on the first day of the hearing I granted the parties a short adjournment to enable them to examine
the Rate Books from which the Reconciliation Statement was compiled. When the Court resumed I was informed by Mr. Patel who appeared
for the Defendant that the Defendant was satisfied that the amounts shown as the rates struck in the Reconciliation Statement were
accurate. I therefore allowed the tender of that document.
Mr. Sang then testified that the Plaintiff based its claim against the Defendant on Sections 78 and 84 of the Local Government Act.
I have already mentioned Section 78 which allows a Council to charge interest at the rate of 11% on all overdue rates.
Section 84 states that where money is paid to a Council in respect of rates, the Council shall apply such money first to the rates
longest outstanding. Because the Defendant had never paid each year's rates when they fell due not only outstanding rates accumulated
but also the Defendant became liable for a greater amount of interest which is included in the definition of rates given in Section
78.
At the conclusion of Mr. Sang's evidence counsel for the Defendant informed me that because the Plaintiff's claim now dates from 1985
it is a new claim. When I then asked why this had not been pleaded in the last Amended Defence Mr. Patel replied that the Defendant
did not have to do this. I disagreed and the matter was not then pursued by Mr. Patel until his final submission.
The Defence then gave evidence through Mr. Edmund March. The general burden of his evidence was that throughout he has disputed the
accuracy of the rates charged against his Company by the Plaintiff. He stated that he did not agree with the amount claimed in the
Amended Statement of Claim but could not tell me why. He said it was difficult for him to discover how the figures were arrived at
despite his numerous discussions with the former Town Clerk of the Suva City Council. He said that he had paid over $42,500.00 in
rates to the Council so that in fact there was very little money owing to the Plaintiff by the Defendant. He alleged that at the
eleventh hour certain people tried to re-construct the accounts to make the figures tally. He said a Ledger entry cannot be altered
without a General entry showing the reason but the Council had not done this in his case. He gave certain figures which he stated
demonstrated inconsistency in the amounts claimed by the Plaintiff which he attributed to a change to personnel in the Council and
general inefficiency of its rates staff. He tendered various documents known as Confirmations of Indebtedness which he had received
from the Council regularly. These documents invited the Defendant to indicate the correctness or otherwise of the amount the Council
claimed as outstanding rates and to return its reply to the Auditor-General in Suva.
Mr. March said that he returned the Confirmations to the Auditor-General's office but did not state on any of them the amount which
he believed he owed the Council or for that matter whether he disputed any of the amounts claimed. He merely marked each Confirmation
he returned with the words "Litigation Pending without Prejudice".
When he was cross-examined Mr. March said he knew how much he owed the Suva City Council but did not tell the Auditor-General this
because the Defendant's books were not audited. He then said that he was not sure of the correct figure on each Confirmation although
he was sure that the amounts stated on the Certificate of Confirmation of Indebtedness were wrong.
It was then put to him that the Demand Notices the Council sent out and the Certificates of Indebtedness all tallied with the Reconciliation
Statement but he did not agree on the amount. I waited in vain for Mr. March to even hazard a guess as to the amount which he thought
the Defendant might owe the Plaintiff. All he could assert was that the Council's records were wrong and he was finally driven to
allege that the reason why he did not pay his rates was that the Council was afraid to tell the Minister (presumably for Local Government)
the true picture of its accounts system.
Apart from this being only speculation it was never put in cross-examination to Mr. Sang. If this were part of the Defendant's instructions
to the late Mr. Patel I have no doubt from my knowledge of him as an advocate that he would have cross-examined Mr. Sang if the Defendant
had given him instructions on this allegation.
In the absence of any alternative figure suggested by the Defendant and unless there is any special defence open to the Defendant
it must follow that there must be judgment for the Plaintiff at least in some amount.
Undoubtedly the Defendant's problems have been caused by its failure to pay rates owing to the Plaintiff on their due date. Had this
been done I have no doubt that this litigation could have been avoided. I pass now to a brief discussion of the submissions made
by the parties.
Mr. Patel told me that the first claim in the Pleadings filed on behalf of the Plaintiff did not show anywhere what became of the
rates which were earlier claimed in the same Writ for the years 1978-1979. This ignores paragraph 4 (n) and (o) of the first Amended
Statement of Claim dated 15th August 1986 which alleged that the Defendant did not pay any rates or interest for the years 1978-1979
when they fell due. These paragraphs also demonstrate the manner in which the Plaintiff assessed the Defendant's liability for rates
in any year and this accords with the evidence of Mr. Sang. Mr. Patel also claimed that the Rate Books were not tendered as exhibits
in this case but he obviously failed to recall the three-hour adjournment I granted the parties on the first day of the hearing to
inspect the Rate Books. No attempt was made to formally tender these books probably because as I have said when the Court resumed
after the adjournment Mr. Patel informed me that the defendant was satisfied the amounts shown in the Books as the rate struck for
each year were accurate.
It is little wonder therefore that Mr. Patel conceded that the Defendant did not dispute the principal amount claimed by the Plaintiff
as the rate struck for a particular year but only the method of calculation and the amount charged as interest. The problem I have
with this submission is that which I mentioned above namely that the Defendant has given no evidence of what the method of calculation
and the amount charged as interest should be if it disagrees with the Plaintiff's calculations.
He also submitted that the Reconciliation Statement could be treated only as a self-serving document without corroborative evidence
to establish the accuracy of the figures mentioned therein. Again however I am not told why this should be so or what type of corroborative
evidence the Plaintiff could lead to satisfy the Court further.
Mr. March complained that he had never inspected the Ledger of the Plaintiff or a true certified copy of it and said the Plaintiff
chose not to do this because the original Ledger had been replaced or tampered with. Again this is only speculation; there is no
evidence to support the accusation and in any event the Defendant could have called on the Plaintiff to produce the Ledger at the
hearing. The Defendant gave two Notices to Produce on the 21st of March 1989 and 19th of July 1995 but in neither of these is the
Council's Ledger mentioned. I therefore reject this submission.
Mr. Patel said that it would be highly speculative for this Court to assume that the Council would have provided all the information
that was contained in the Ledger or Journals.
I tend to agree with Mr. Patel but note that in response to a question from me Mr. March stated that although he was not allowed to
look at the Ledger the Council gave him copy extracts for the relevant years which he accepted without prejudice although he did
not know whether they were true extracts. He said he could not be 100% sure that they were genuine but the Plaintiff has satisfied
me on the only standard of proof necessary that on the balance of probabilities the extracts were genuine.
On page 5 of his written submission Mr. Patel gave a comparison of the figures provided in Defence exhibits D.10, 11 and 12 which
are Confirmations of Indebtedness with the further Amended Statement of Claim and invited me to find that these were contradictory.
I regret that I could not understand Mr. Patel's submission on this but in the end have based my calculation of the amount due by
the Defendant on the rates Reconciliation Statement exhibit P.1.
The Defendant has failed to satisfy me that this statement is not an accurate record of the various movements in the Defendant's account
with the Plaintiff except for certain parts which I do not understand and on which no evidence was led by the Plaintiff. These however
are only minor in relation to the whole amount claimed and I have made certain small adjustments based on my own understanding of
the Reconciliation Statement. Thus for the year 1990 I allow the sum of $8,116.70 in lieu of the amount stated in the further Amended
Statement of Claim of $9.009.54. For the year 1991 I allow $9.496.97 in lieu of the Plaintiff's claim of $10,189.32. For the year
1992 I allow $10,398.79 in lieu of $11,784.80. For the year 1993 I allow $12,287.86 in lieu of $12,812.46. For the year 1994 I allow
$13,636.40 in lieu of $14,157.90. I accept the amount claimed for the years 1985-1989 in the further Amended Statement of Claim.
The total in my judgment is therefore $92,429.75 compared with the $96,446.81 claimed by the Plaintiff.
Mr. Patel submitted that I should not allow the Plaintiff any interest which he said must be pleaded in the body of the Pleading and
relied on Order 18/8/10 of the High Court Rules. With respect, this is simply not true. Paragraph 4 of the Further Amended Statement
of Claim specifically claims interest at the statutory rate of 11% on arrears of rates in accordance with Section 78 of the Local
Government Act.
Finally the Defendant submits that the Plaintiff is barred by Section 4(1) of the Limitation Act Cap. 35 which says that actions founded on simple contract or tort shall not be brought after the expiration of six years from the
date on which the cause of action accrued. It is submitted that by its further Amended Statement of Claim the Plaintiff is now pleading
a new cause of action altogether which becomes barred by Order 20 Rule 5 of the High Court Rules and cites in support the case of
Eshelby v. Federated European Bank Ltd. (1932) 1 K.B. 254 I disagree, first because under Section 75 of the Local Government Act the recovery of rates are a first charge on the land rated
and the time limit for actions to recover a charge on property is 20 years by virtue of Section 8(1) of the Limitation Act Cap. 35, assuming that the Limitation Act applies. In my judgment it does not. In my view the Plaintiff is not pleading a new cause of action as was the case in Eshelby v. Federated European Bank Ltd. but a continuation of an existing cause of action.
This was the first detailed reference by the Defendant to the Limitation Act. I have previously mentioned on page 6 of this judgment that counsel for the Defendant had alleged that the Plaintiff was now making
a new claim but he did not mention that the Defendant was going to allege that any claim by the Plaintiff from 1985 was barred or
had to be reduced by the application of Section 4(1) of the Limitation Act.
Order 18 Rule 7 states that a party must in any pleading subsequent to a Statement of Claim plead specifically any matter, for example,
performance, release, any relevant statute of limitation, fraud or any fact showing illegality -
(a) which he alleges makes any claim or defence of the opposite party not maintainable; or
(b) which, if not specifically pleaded, might take the opposite party by surprise; or
(c) which raises issues of fact not arising out of the preceding pleading.
This is the successor of the former Order 19 Rule 15 of the English High Court which for present purposes is identical with our High
Court Rules Order 18 Rule 7 and was referred to by Buckley L.J. in Re Robinson's Settlement [1912] UKLawRpCh 40; (1912) 1 Ch. 717 at pp. 727 to 728 who said:
"It applies to all cases of grounds of defence or reply which if not raised would be likely to take the opposite party by surprise
or raise issues of fact not arising out of the pleadings. Where the defendant ought to plead things of that sort the rule does not
say that if he does not the Court shall adjudicate upon the matter as if a ground valid in law did not exist which does exist. If
in the course of the proceedings it was proved that the deed sued upon was a forgery and the defendant does not plead it or did not
know it was a forgery, the Court would not give judgment upon the deed on the footing that it was a valid deed. The effect of the
rule is, I think, for reasons of practice and justice and convenience to require the party to tell his opponent what he is coming
to the Court to prove. If he does not do that the Court will deal with it in one of two ways. It may say that it is not open to him,
that he has not raised it and will not be allowed to reply on it, or it may give him leave to amend by raising it, and protect the
other party if necessary by letting the case stand over. The rule is not one that excludes from the consideration of the Court the relevant subject-matter
for decision simply on the ground that it is not pleaded. It leaves the party in mercy and the Court will deal with him as is just."
At no stage did the Defendant apply for leave to amend its Defence, as in my view it should have if it wished to avail itself of the
Limitation Act. Mr. Patel submitted that the Court should disallow all amounts claimed by the Plaintiff from 1985 to 1988, in other words that the
six-year limitation period applied for the years 1985, 1986, 1987 and 1988. If the Defendant wished to allege this then the proper
time for doing so was either in the Amended Statement of Defence of 23rd March 1995 or at the beginning of the trial. The Defendant
chose not to do this and consequently appears to me to have raised a limitation defence purely as an afterthought.
For the foregoing reasons there will be judgment for the Plaintiff in the sum of $92,429.75 together with interest at the rate of
8% from the date of the further Amended Statement of Claim, 13th March 1995 until the date on which the hearing of this action began,
8th July 1996. The Defendant must also pay the Plaintiff's costs.
JOHN E. BYRNE
JUDGE
Legislation and cases referred to in judgment:
Limitation Act Cap. 35.
Local Government Act Cap. 125.
Rules of High Court 1988.
Eshelby v. Federated European Bank Ltd. (1932) 1 K.B. 254.
Re Robinson's Settlement [1912] UKLawRpCh 40; (1912) 1 Ch. 717.
The following additional cases were referred to in argument:
Ba Township Board v. Chimanbhai Appabhai Patel and Another 14 FLR.
Halliard Property Co. Ltd. v. Jock Segal Ltd. (1978) 1 WLR 377.
Suva City Council v. The Minister for Works and the Attorney-General of Fiji Supreme Court Civil Action No. 419 of 1981.
Wadsworth v. Lydall (1981) 1 WLR 598.
