Prasad v Hakim [2008] FJHC 359; HBC370.2006 (19 December 2008)

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Counsel: Ms. A. Neelta for the Plaintiff/Respondent
Ms. P. Narayan for the 1st Defendant/Applicant

[1]. The plaintiff, Yogesh Prasad commenced this action as the Administrator of the Estate of his late brother, Manoj Kumar Kirpal, late of Nausori. Liability was admitted by the defendant on 4th September, 2007, whereby a judgment by consent entered "as to liability against the defendants with damages to be assessed under O. 37 of the High Court Rules 1988." Following the consent judgment, a Summons for Assessment of Damages was filed on 4th September, 2007, on the basis of which, the assessment proceeded before me.

[2]. The deceased, a 35 year old man died in a fatal road accident on 22nd day of October, 2005. He was a passenger in a taxi registration number LT 223. A ten wheeler truck, registration number, DL 420, belonging to the Second defendant, Fuel Supplies (Pacific) Limited, driven by the First Defendant, collided with the said taxi at Waidamu Bridge, causing the taxi to plunge in to the Waidamu River. As a result of the accident, the deceased together with other passengers died instantly.

[3]. Subsequently, the first defendant was charged and convicted for the offence of Causing Death by Dangerous Driving. Further he was sentenced to two and half years of imprisonment and disqualified from driving for a period of three years by the Nausori Magistrate’s Court.

[4]. At the time of the accident the deceased was gainfully employed by Marine Industrial Structural Engineering Limited (MISEL) as an Accountant. I will return to the deceased’s engagement in MISEL later in the judgment.

(d) Interest pursuant to Section 3 of the Law Reform (Miscellaneous Provisions) (Death and Interest) Act.

[6]. Ms Neelta prior to the hearing and later confirmed in the written submission that "Though the plaintiff claimed compensation in the writ under Compensation to Relations Act, (Cap 25) he will only pursue the claim for loss of deceased’s Estate under the Law Reform (Miscellaneous Provisions) (Death and Interests) Act." (Cap 27)

[7]. Ms Narayan, on behalf of the defendants at page 2 of the written submissions acceded Ms Neelta’s submissions. She submitted that "1.01 The plaintiff claims for lost years earnings which are commonly referred to as "lost years". This head of damages was accepted as a valid lead of claim in Daya Ram –v- Peni Cara and others in Fiji."

[8] . The Court of Appeal in Ratu Viliame Fakimoana Dreunimisimisi & Anor. –v- David Nag Ratnam Civil Appeal No. ABU 0066/92 also upheld the claim for lost years. His Lordship Mr Justice Sadal assessed the damages for loss of earning under the Law Reform (Miscellaneous Provision) (Death and Interests) Act (although not clear form the judgment). It was agued by the appellant that "the Learned Trial Judge applied a wrong principle in awarding damages for loss of earning for lost years in terms of the Law Reform as opposed to Compensation to Relatives Act".

[9]. In upholding the assessment, their Lordships upheld the damages were assessed under the Law Reform (Miscellaneous Provisions) (Death and Interests) Act. However, the only effect would be that any award made thereto goes to the estate, the distribution of which is the responsibility of the Administrator. As to the particular facts of the case before the Court of Appeal, their Lordships said:-

"Mr Ratnam in his capacity as administrator of Lazaraus David’s estate, so far as dealing with the proceeds of the judgment is concerned, is a matter he must resolve for himself and that no doubt will be affected by the question of whether the dependents of the deceased are, or are not, the same persons who are the ultimate beneficiaries of his estate. The damages awarded under the Law Reform provision form part of Lazaraus David’s estate and do not go to his dependents in terms of the Compensation to Relatives Act".

[10]. Before, embarking onto the assessment of damages, it is crucial to discuss the differences between the two Acts. This distinction was deliberated by the Court of Appeal in Daya Ram -v- Peni Cara and others (supra). Speight J A at page 149 (para c to g) firstly described the nature of claim and method of assessment of damages for the dependants under the Compensation to Relatives Act as follows:-

"......It is not an award to dependants for the loss of support which they would have been entitled to expect had there not been the death of the breadwinner. Such claims are brought in Fiji under the Compensation to Relatives Act (Cap. 29). In such cases, in this and other jurisdictions, such a claim is calculated by examining the amount of money which dependant relatives had been receiving in the past for their support and which they might legitimately have expected to have received in the future provided the deceased had had the means to make such payments and could have been expected to continue making them. This was a purely mathematical calculation of how much he would have been worth in money terms to his dependants for what ever was the expected period of dependency.

"It finds its justification in the Law Reform (Miscellaneous Provisions) (Death and Interest) Act Cap. 27. The claim is brought under section 2 and is for the benefit of the estate in respect of all causes of action which the deceased had at the time of his death. In the case of a person who is injured an action lies by him in tort for such damages as will represent in money terms his loss of future earnings; how he would have spent those earnings in the future is irrelevant to such a claim. By the statutory provision of Cap. 27 in the case of a man who is injured and dies the cause of action for the lost years vests in the deceased when he is injured and in the case of instantaneous death immediately before his death, and after death passes to his personal representative. Such claims are authorised in the English legislation by the Law Reform (Miscellaneous Provisions) Act 1934 which is for present purpose the equivalent of the Fiji Statute.

Accordingly the claim on behalf of a deceased estate for loss of earnings for lost years is now firmly established as on the same footing as the same claim by a living person, subject to the reservation as to deduction of personal living expenses."

[12]. Once again the court of appeal alluded to the two basis of assessment of damages under the two Acts in Sunil Chandra –v- Ram Narain Civil Appeal No. 134 of 1990 as follows:-

"We are surprised that Sadal J. did not advert to these two bases for damages because the judgment of this court delivered on 30/6/1994 in the case of Dreunimisimisi and Another v. Ratnam (Civil Appeal No. 60 of 1992) was an appeal from the same Judge. That judgment referred to Daya Ram v. Pene Caca (Civil Appeal No.50 of 1992) a judgment of this Court delivered in March 1983. In both judgments, this Court set out the bases for calculating damages under both causes of action.

The first calculation, (Compensation to Relatives Act) i.e. of the claim for compensation due to the father and mother occasioned by the death of the deceased, would have as its first step an assessment similar to that taken by the learned Judge i.e. to assess the pecuniary loss to the relative. Next the Judge would have to project for how long that loss would ensure; then he would calculate the ‘present value’ of a lump sum which invested now would produce an annuity for the required amount over the required term. Finally some deduction for contingencies would have to be made. Such calculations are made by accountants and actuaries. We do not understand why the Judge was not assisted by such evidence in the present case. In the absence of further evidence, we see no reason to interfere with the Judge’s assessment although we have grave doubts about his method of calculation.

The other claim under the Law Reform legislation would have been for the "lost years’ for the benefit of the estate of the deceased. It could be considerable, given that the deceased was a young man of promise, aged 17 and in good health. The two heads of damage were not specifically addressed in counsel’s submissions

[13]. Invariably, an award for ‘lost years’ in many cases may exceed the dependency claim, but not vice-versa. His Lordship, Mr Justice Fatiaki (as he then was) in Hari Pratap -v- Attorney General of Fiji and Anor Suva High Court Civil Action No. HBC 95/1986, stated:-

‘In this case although a claim has been made under the Compensation to Relatives Act the written submissions of learned counsel for the plaintiff seems to accept that "... the claim under the former Act (i.e. Law Reform) is more important then under the latter Act (i.e. Compensation to Relatives) because most of the deceased's children were not dependant as such (sic) were not too young." Furthermore counsel concedes that "Damages under (the) Compensation to Relatives Act would not exceed the damages under the Law Reform Act."

[14]. The rationale for the above is discussed in Somari v. Attorney General Civil Appeal No ABU 0026/1980, where His Lordship Marsack JA said:-

"..it is clearly established that a claimant is not entitled to recover damages amounting to a total of what could be claimed under each Act. If for example, a claimant is held entitled to a sum under the Law Reform Act then that sum must be taken into account in assessing the entitlement under the Compensation to Relatives Act"

[15] . His Lordship, Mr Justice Fatiaki (as he then was and, now the Honourable Chief Justice), in Hari Pratap -v- Attorney General of Fiji and Anor Suva High Court Civil Action No. HBC 95/1986, after having found difficulties with the "sparse" evidence of dependency, declined to asses the claim under Compensation to Relatives Act and proceeded to assessment of damages under Law Reform (Miscellaneous Provisions) (Death and Interests) Act for lost years. In doing so, His Lordship said:-

"Whilst I do not doubt that the absence of the father had an immediate impact on the profitability of both concerns equally, I do not accept that any "dependency" of his children would have continued for any appreciable length of time, indeed, the converse is the more likely as the father got older and the children took on a greater responsibility for the running of the shop and farm"

[16]. I will now proceed to the assessment under the traditionally renowned heads of damages.

[17]. Special damages are monetary losses actually suffered including any expenditure incurred. They are assessed up to the date of the judgment. By its nature it is capable of precise arithmetic calculation. Paff -v- Speed [1961] HCA 14; [1961] 105 CLR 549 at 558-559 per Fullagar J. As a matter of law, they must be pleaded and strictly proven; Tacirua Transport Company Limited -v- Verend Chand Civil Appeal No. ABU 0039/94 at page 3. The plaintiff has partially complied with this mandatory procedural requirement.

(i) Funeral expenses	$3,500-00
(ii) Legal costs of obtaining Letters of Administration	$ 650.00.
(iii) Vehicle search	$ 14.00.
(iv) Post Masters report	$ 5.63
(v) Police report	$ 22.50

[18]. Save for the funeral expenses, the defendant concedes to the rest of the claim. Thus, there is no dispute for the sum of $692-13.

[19]. By virtue of S. 11 of the Law Reform (Miscellaneous Provisions) (Death and Interest) Act, "Damages may be awarded in respect of funeral expenses of the deceased persons of such expenses have been incurred by the party whose benefit the action is brought." In paragraph 15 of the Statement of Claim, the plaintiff pleads the beneficiaries of estate for whose benefit this action is brought:-

[20]. Neither of them actually incurred the funeral expenditure. However, the plaintiff claim’s that he personally incurred the expenditure and seeks a refund from the Estate. Under the circumstances the claim for funeral expenses is validly made.

[21]. Ms Neelta submitted that the plaintiff is entitled to a refund of $3,500-00 expanded in the funeral. On the other hand, Ms Narayan largely relying on the evidence, submitted that only a sum of $2, 200-00 was proved and be awarded.

[22]. The claim for funeral expenditure consists of the actual funeral, and subsequent rituals including prayer gathering for six and twelve months respectively. Of the items claimed, the plaintiff testified that he does not seek any money for the coffin box which cost him $2,000-00. Ms Narayan accepted the claim for cremation, which the plaintiff estimated it to be $400-00. Considerable some of kava was consumed. That amount was $1,500-00. Further the expenses for the six and twelve months rituals was $300-00.

[23]. The difficulty with the plaintiff’s claim is that no documentary evidence was adduced. When purchasing groceries, prayer related items and other necessary items ordinarily cash machine print-outs are given to the purchaser. Where every single item is to be claimed, the requirement of proof becomes crucial, thus they should have been adduced. Be that as it may, the courts have recognised the funeral rites and customs of various religious denominations.

[24]. His Lordship Mr Justice Pathik, in Jona Moli -v- Dr Frances Bingo & Others Suva High Court Civil Action No. HBC 335/1998, on the funeral expenses said:-

"We are all familiar with the customs of the various races in Fiji and in the context of funeral there are certain expectations and obligations which have to be fulfilled. It is only right that reasonable expenses ought to be allowed without requiring the plaintiff to produce receipts and proof of each items of expenditure as is required for the purposes of proving special damages."

[25]. In view of inadequate evidence to prove the $3,500-00 claimed I will award the sum of $2,200-00 as conceded in cross-examination by the plaintiff. Thus the total award under this head amounts to $2,892-13, which I will round-off to $2,900-00.

[26]. The conventional sum of $2,500-00 is claimed under this head. Ms Narayan did not make any reference to this in the written submissions. Damages are awarded for loss of expectation of life for the loss of a predominantly happy life. A cause of action for loss of life vests with deceased instantly, upon death which survives for the benefit of the estate under 2 of the Law Reform (Miscellaneous Provisions) (Death and Interests) Act.

[27]. Perhaps, I will begin with the clear statement of the reason for award under this head, as stated by Speight JA, in Daya Ram -v- Peni Cara & Others [1983] 29 FLR 147 sum at 148 para a-h:

"Turning to the present case we will deal first with the lesser items challenged namely loss of expectation of life. The basis of making an award for loss sustained by the removal of proposed predominantly happy life...."

[28]. The award under this head was aptly explained by Lord Morris in Yorkshire Electricity Board -v- Naylor [1967] 2 ALLER 1 at page 6:-

"Though it is said that his death was instantaneous, the appellants have not sought to dispute that a valid cause of action vested in him. By reason of the provisions of the Law Reform (Miscellaneous Provisions) Act, 1934, that cause of action survived for the benefit of his estate. .........He lost what is usually called his expectation of life. The loss was something personal to himself......"

[29]. A moderate sum is awarded by the Courts in Fiji. I have considered authorities such as Daya Ram -v- Peni Cara and Others [1983] 29 FLR 147, ($1,250-00), Subamma -v- Chandar Court of Appeal Civil Appeal No. ABU 0056/83, Hari Pratap -v- Attorney General Court of Appeal, Civil Appeal No. ABU 0014/1992 ($2,500-00) and Alusio Daino -v- Attorney General, Suva High Court Civil Action No. HBC 0515/1996, ($2,500-00).

[30]. After Hari Pratap -v- Attorney General (Supra), the appropriate sum now awarded is in the sum of $2,500-00. I will, accordingly award a sum of $2,500-00 for loss of expectation of life.

[31]. I have already alluded to the nature of the claim under this Act. The methodical means of the calculation of damages for lost years was succinctly stated by Speight J. A. in Daya Ram –v- Peni Cara and Others [1983] 29 FLR 147 at 151 as follows:-

(b) what is an appropriate funds over and above his personal living expenses in those years?"

[32]. Pursuant to S. 2(c), damages recoverable for the benefit of the estate of the deceased "...shall be calculated without reference to any loss or gain to his estate consequent on his death..." Therefore the basis of the quantum of damage crystallises immediately upon death.

[33]. The conventional approach to the assessment of damages for the lost years is thus arrived at as follows:-

(b). From the net earnings, a deduction must be made of the deceased’s personal earnings.

(c). The sum in para (b) is then multiplied by the actual number of lost years, that too is to be ascertained by the Court taking into account the contingencies and vicissitudes of life.

[34]. This issue was vigorously disputed before me. On behalf of the plaintiff it is claimed that the plaintiff at the time of the death was earning an annual gross income of $45,000-00. Of this the plaintiff was earning $25,000-00 as salary and $20,000-00 as Director’s fee.

[35]. On the other hand, the defendants’ submitted that the evidence adduced indisputably establishes a monthly gross income of $2.082-08. Thus at the time of his death the annual gross income would have been $24,984-96. (see page 10 para 2.31 of the submissions).

[36]. The plaintiff called three witnesses, namely Yogesh Prasad (PW 1), Kelepi Funilagi (PW 2) and John Basil (PW 3). To rebut the plaintiff’s evidence the defendant called only one witness namely, Joseva Leano (DW 1).

[37]. Yogesh Prasad told the court that the deceased was employed as an Accountant and Director of MISEL. He frankly stated that, for the income he relied on the records of the company, which was obtained after the death. On the basis of the records provided he stated that the deceased’s total annual earnings were $25,000-00 as fixed salary and $20,000-00 as Directors fee. On the career in accounting, Prasad testified that the deceased was undertaking further studies from University of the South Pacific and a Bachelor of Accounting with ACCA, London. This was tendered in Court as exhibit "EX13"

[38]. On the Director’s fee, Prasad referred to a letter dated 5th March, 2005, (see tab 20 the bundle of documents). It states:-

Could you please arrange to transfer (fifty Thousand dollars) from account No 7067479 the account of

[39]. To confirm payment, Prasad further adduced evidence of the money actually paid into the deceased’s Westpac Account No. 980031007 (see tab 21 of the bundle). On 27th October, 2006, Westpac Banking Corporation confirmed that a "sum of $50,000-00 was credited in to "the deceased’s account by Marine Industrial on 4th March, 2005." In cross-examination the plaintiff was asked as to the number of bank accounts the deceased had held. He candidly stated that he was only aware of two accounts. The $50,000-00 fixed deposit and an operating account. Since prior discovery was not sought for the bank books or details of the respective accounts, the plaintiff was unable to provide the same, when asked by Ms Narayan.

[40] The second witness was Kelepi Funilagi (Funilagi’s). Kelepi Funilagi is the accountant of MISEL. He is employed by the company since 2002 as an Accountant. Initially he was employed as an Accounts Officer. Funilagi confirmed that the deceased was employed as an accountant as well as the Director of the company. He had worked with the deceased.

[41] According to Funilagi, Kirpal was the head of the Accounting Department. The deceased became a Director in 1998.

[42] The deceased was earning $2,082-08 as gross monthly salary. This sum was based on an hourly rate of $11.83. The total number of hours worked per month was 176. Ms Narayan did not contest this amount as such I uphold that the deceased monthly gross earnings was $2,082-08. At this stage I will make no allowance for the tax.

[43] Next, Ms Neelta submitted that the salary of the deceased was supplemented by the Director’s fee annually. In 2005, he was to receive $20,000-00. In fact the sum was paid in advance. Ms. Narayan, on the other hand vigorously opposed the said sum as earning of the deceased. Her argument was three folds. Firstly, the company never paid the said sum. It was merely designed to avoid tax by the company. Secondly, it is not a stable income. Even if the company was paying the said sum, nonetheless it was dependant upon the company’s financial position and ability to pay. The decision for any such payment lay with the Board of Directors. Thirdly, the deceased may not have continued as Director for the rest of his life.

[44] Funilagi confirmed that he deposited the sum of $50,000-00, which sum was the Director’s fee earlier alluded to by the plaintiff in his evidence. He further stated that deceased was appointed as a Director due to his background and experience. In fact he was the "brain of the company". Late Kirpal was appointed Director in 1998 by the shareholders. He was re-appointed as the Director as confirmed in the MISEL’S Annual General meeting held on October, 2004. At page 31 tab 8 of the bundle of documents, the minutes records show:-

"Election of Directors - Mr Manoj Kirpal Kumar retired in accordance with Companies Articles of Association, and being eligible, offered himself for the re-elect.

Resolved that Mr. Manoj Kirpal Kumar is hereby re-elected Director of the Company."

[45] Further evidence of the deceased being a Director of the company is contained in the Companies Annual Returns required to be filed at the end of each year under the Companies Act (see page 38 of the Bundle).

[46] Funilagi, was then showed and referred to the "Company’s Income Tax Return "Form "C" for the year 2003, which shows that the Company was paying Directors fee. Item 53 in the Form specifically refers to late Manoj Kumar being paid $15,000-00 as Directors fee for that year. In addition the deceased’s "Tax Indentification Number of Director" is also provided. His number was 11-17907-0-2.

[47] Similarly, in the Company’s Income Tax Return for 2004 with the same details, late Manoj Kumar was paid a Director’s fee of $20,000-00. In 2004, a total of $55,000-00 was paid out as Director’s fee by MISEL. The other Directors were Kele Taliu ($25,000-00) and John Basil ($10,000). (see page 63 Tab 16 of the bundle). MISEL’S Annual financial statement was prepared by KPMG Charted Accountants. The 2004 report was tendered marked as exhibit 11. It is contained in the bundle of documents at tab 17 pages 65 – 84. At page 76 of the bundle, under the heading "Personal Expenses", there is an express statement of "Directors Emoluments", which sum was $55,000-00 for 2004 and $50,000-00 for 2003.

[48] Both these amounts correspond with the Companies Tax Return Form. I will return to this document later in the judgment. Funilagi maintained that he processed the Director’s fee. In support he tendered the Company’s Bank Statement which showed the payment of the said money from the Company’s ANZ Bank current account No: 7067479. (see exhibit 15).

[49] Based on this, Ms Narayan, cross-examined Funilagi at length that the Company was not paying the Director’s fee. Mr Funilagi answered by stating that the Company was paying the fee and where it was not paid it still remained a liability for the Company. Next Ms Narayan, suggested to Funilagi that the money paid to the deceased in fact was a loan. She based the cross-examination on a letter dated 2nd March, 2005, in which the deceased requested for a loan.

Further to our discussion of today and as per my request to you I wish to draw my Directors fee in advance for investment purpose. The amount I request is (Fifty Thousand dollar).

[50] Funilagi readily agreed to it. However, he was firm in reply that it was to be paid back by deducting from the Director’s fee payable to the deceased for the years 2004, 2005 and 2006. On that security the loan was given.

[51] Funilagi maintained that the deceased was paid $45,000-00 inclusive of the salary and Director’s fee. In addition, the decease was paid FNPF on the salary of which the MISEL’S contribution was 8% of the gross salary.

[52] The third witness called by the Plaintiff was John Basil. John Basil is a Director, Shareholder and founder of the MISEL. He was also working in the company as an Engineer. By profession he is a fitter and machinist. He knew the defendant since 1990.

[53] According to Basil, the Company commenced its business in 1997. It was formed by a group of workers of United Engineering Limited. United Engineering Limited had financial difficulties and was at the brink of being wound-up when eight of the workers, decided to buy-off the shareholding in the company. Late Kirpal was with the fellow workers, but was not noted as a shareholder in so far as the records of the Company depicts. However, he was a financier in pari pasu with the named Shareholders. Basil explained the reason for this. The purchase of the Company was by a loan from the Fiji Development Bank. At that point, FDB was giving loans to only Indigenous Fijians and not to other races. There were two Indo-Fijians, namely, Late Kirpal and Sam Mudaliar. In order to get the loan, the two Indo-Fijians were silent shareholders.

[54] From its in-corporation, Late Kirpal was the Accountant and Director of the Company. In cross-examination Basil explained that Late Kripal was not paid dividends as a shareholder. However, his shareholding benefit was incorporated with the Director’s fee. For that reason, Late Kirpal would continue to receive Director’s fee until he remained with the company.

[55] Further, during cross-examination Basil asserted firmly that the Director’s fee would have gone up in future. Certainly it would not have been reduced. In any event, for the assessment of loss to the estate, I am required to take the income without any loss or gain to the estate as of the date of the death.

[56] On the $50,000-00 lump sum paid to Late Kirpal, Basil reiterated in cross-examination, supporting the evidence of Funilagi that it was paid as past, present and future Director’s fee. The advance sum paid was to be deducted by the Company. In addition, Basil confirmed that the payment of Directors fee was duly approved by the Board of Directors of MISEL. Finally, Basil being a Director himself confirmed receiving the Directors fee from MISEL. He saw no reason as to why Late Kirpal would not have received his fee.

[57] The defendant called Josefa Leano, as the sole witness. This witness was called to explain the financial reports of MISEL prepared by KPMG to which I have already alluded to. Josefa was a former employee of the Fiji Islands Revenue and Customs Authority (FIRCA). He was dismissed by the Authority.

[58] Ms Neelta objected to the witness giving statement on the grounds that he may breach S. 4(3) of the Income Tax Act, which states:-

3) No officer or person appointed under, or employed in carrying out the provisions of this Act shall be required to produce in any court any return, document or assessment, or to divulge or communicate to any court any matter or thing coming under his notice in the performance of his duties under this Act, except as may be necessary for the purpose of carrying into effect the provisions of this Act, or in order to institute a prosecution, or in the course of a prosecution, for any offence committed in relation to tax.

[59] At that point, I informed counsel of a letter dated 19th February, 2008 written to court by FIRCA. That letter was a response to a subpoena by the defendants to Mr James Delana, the Chief Auditor of the Authority. By the letter the Authority stated:-

"We understand that this is a private matter and as such our officers cannot provide the information required."

[60] Of course, the information sought was that of Kirpal’s personal tax records. From the outset, I directed the witness, a former employee of the Authority, not to offend the provisions of the Income Tax Act. More-so when he was no longer employed with the Authority. On that basis, I turned down Ms Neelta’s objection and allowed the witness to testify.

[61] Josefa Leano has a degree in Economics and Accounting from University of New South Wales. He has a wealth of experience in taxation and accounting.

[62] On the concept of accrual accounting, in examination in chief, reading from KPMG’s report he stated as follows:-

"Companies financial report looks like this. Director’s fee and bonuses are shown as debts of the Company. Company owes them the money. It is a legitimate debt of the Company."

"Accrual accounting has taken account of the liabilities of the Company’s Director’s entitlement to Director’s fee from the KPMG report. It means it was earned by the Directors for the year."

Question: Will the accrual accounting show for the given year the debts that still remains to be paid?

Josefa Leano was very frank with his answers. In short, from his evidence it is obviously plain that the Company was paying Director’s fee.

[64] Next, Ms Narayan intended to call a bank officer to give evidence of late Kirpal’s account, which was met with a serious objection. I gave an Ex-tempore Ruling on that point as follows:-

"Pursuant to S 6 of the Bankers Books Evidence, Cap 45 the Bank is not a compellable witness where the bank is not a party in the proceedings.

S. 6 require a "Special Cause". Defendant have not shown any special cause. All which the book will show is the money which he deposited in the Bank. That is neither here nor there as to the income of the deceased, which the Court is required to assess.

It is not necessary that all the monies deposited are earnings from the salary or Director’s fee. Equally important, it is not necessary that all employment income is deposited in the Bank. The deceased is no longer available to verify this.

I am not satisfied to compel the Bank to given evidence on a matter on which its customer has not given consent. The relationship of a Banker/Customer is a special one governed by the rules of confidentiality. The pass book or for that matter anything to do with the account should have been done at the discovery stage. This was not done.

[66] I believe the evidence of Funilagi, Basil as well as the defendants’ witness Josefa Leano. They all appeared to be candid and honest in their respective testimony. There is no contention that the deceased was earning a gross sum of $2,082-08 per month. He was paid an hourly rate of $11.83. On that basis he would have earned an annual gross income of $24,984-96. Ms Neelta submitted at length that the deceased was paid a sum of $25,000-00 per annum as salary. This was confirmed by Funilagi. However, Funilagi also confirmed that the deceased received $2,082-08 per month. The anomaly was not explained at all. Accordingly, I hold that late Kirpal was paid and received a gross salary of $24,984-96.

[67] On the Directors fee, Ms Narayan in the written submission at page 9 para 2.29, phrase the issue as follows:

"The issue that needed to be addressed is not whether the Deceased would have continued to be a Director of MISEL but whether he would have received remuneration for the service provided as a Director."

[68] She concurred that "It must be noted that 2005 is the only year the plaintiff has established that the deceased was entitled to Director’s fee." Exhibit 14 (see para 2.29 of the submission).

[69] On the evidence adduced before me, I find that MISEL was paying Director’s fee. To that end the evidence of Funilagi and Basil called on behalf of the plaintiff remained unchallenged. Their oral evidence is fortified by documentary evidence which I may add were prepared well before the death of the deceased. Those documents have no bearing on the death. They were prepared in their ordinary course.

[70] Late Kirpal was a Director of the Company (see pages 31,38 of the bundle). The evidence of the payment of Director’s fee is contained as pages 59, 63, 76, 85, 86, 87, 88 and 89 of the bundle of documents filed and referred to during the hearing. In addition, MISEL’S ANZ Bank current account shows a transaction dated 3rd and 10th of March, 2005 whereby a sum of $50,000-00 was paid to Late Kirpal’s account. These payments were paid before the accident. In view of there being no other evidence in rebuttal, I have no hesitation in holding that the transactions as depicted by the various documents are bona-fide.

[71] In any event, the defendant’s witness confirmed that from the Financial Statement the company owed to the Directors their fee. It was a sum which is capable of recovery by the creditors. In the strictest sense of accrual accounting, Josefa Leano confirmed that "the Directors fees were paid by the Company."

[72] Turning to Ms Narayan’s written submissions, she placed substantial reliance on the Notice of Assessment of the tax issued by FIRCA. Referring to S. 62(8) of the Income Tax Act, she stressed that "...the assessment shall stand and shall be valid and binding upon a tax payer...." For that reason, it was said that 2003 and 2004 returns are binding-upon the deceased.

[73] S. 62 of the Income Tax Act deals with the Appeals Procedure for a decision of the Commissioner of Inland Revenue. The sole purpose of the S. 62(8) seems to place a restraint on tax-payers from refusing to pay the tax. It prescribes a period after which the taxed sum becomes due and payable. S. 62(8), certainly is not conclusive of the income for legal proceedings totally unrelated to a tax matter. In any event tax return does not reflect the total income of a person. It is one of the many evidence available to the parties to prove the income on balance of probabilities, which is a matter entirely in the discretion of the adjudicator. His Lordship, Mr to Justice Scott’s judgment in Shiu Ram -v- Gordon Jai Narayan and Another Suva High Court Civil Appeal No. 11/1991. At page 4 of the judgment, His Lordship said that "It is notorious that the income tax return of certain self employed person .... .... reliable grievance to the actual profit being made." Be that as it may, in the assessment of damages, the paying party (the defendants herein) is not required to pay the tax to the recipient or tax authority. On this basis, I reject Ms Narayan’s submission on this point.

[74] To sum up on this point, I uphold Ms Neelta’s submission that Director’s fee is income for the purposes of claiming loss of benefits to the estate; Shaw -v- Evans and also Perry -v- Munro & Anor. (QBD) per Drake J.

[75] The next issue is whether the Director’s fee is taxable? Funilagi in his testimony plainly said:-

"Company does not deduct any tax on the Director’s fee. It is a matter for the Inland Revenue Department and the tax payer."

[76] S 191 of the Income Tax provides that it shall be "unlawful for a company to pay a Director remuneration (whether as a Director or otherwise) without income tax or any tax on income or otherwise calculated by reference to or verifying amount of his income or any other tax on income or with the rate of income tax..."

[77] Further-more S. 191 (2) provides that "Any provision contained in the company’s articles or in any contract ....or any resolutions of a company, or a company’s Director, for payment of Directors remuneration as aforesaid shall have effect as it provides as a gross sum subject to income tax and any other tax or income of the net sum for which it actually provides."
(emphasis added)

[78] Ms Narayan in the written submissions delved at length on the possible breach of the Income Tax Act. However, this is not a case, where I am required to decide on any such breaches. The Court’s duty is to assess the loss of benefit to the estate based on the evidence.

[79] In assessing the damages the Court must take in to account the tax element. In British Transport Commission –v- Gourley [1955] UKHL 4; [1956] AC 185, their Lordships held that necessary discount of tax payable must be made at the time of the calculation of damages. It is for that reason no tax is payable on damages award for loss of earning or earning capacity. Earl Jowytt at page 203 said:-

"the obligation to pay tax – say for those in possession of exiguous incomes – in also universal in its application. That application is ever present in the minds of those who are called upon to pay taxes, and no sensible person any longer regards the net earning from straight of profession as equivalent of his available income. Indeed say for the fact that in many case – though by no means in all cases – the tax only becomes payable after the money has been received. There is I think there is no element of remoteness or uncertainty about its incidence."

[80] The law in this country as well settled. As such I find that the total gross earning of deceased at the time of the death was:-

[81] The rate of tax payable for the said amount is ascertainable from the table of the rates normal tax for 2005 which shows:-

Years of Income 2004
Chargeable Income	Tax Payable
......... $	........ $
0 – 7,500	Nil
7,500 – 10,000	Nil + 15% of excess over $7500
10,001 – 20,000	375 + 25% of excess over $10,000
20,001+	2875 + 31% of excess over $20,000

[82] Before the taxable income is ascertained, discount must be given to the permissible deductions or rebate. There was no evidence of the same. Only rebate which can be considered is the FNPF contribution which is a maximum sum of $1,500-00. At a gross salary of $24, 984,94, the deceased FNPF contribution at a rate of 8% was $1,998.79. Thus a total allowable rebate of $1,500 is applicable.

[83] Thus the total applicable tax of the deceased from Table of Rates of Normal Tax as issued by FIRCA for 2005 is:-

[84] That is not the end of it. In accordance with the ratio in Daya Ram –v- Peni Cara (supra), necessary discount be made for the personal expenditure of the deceased. Since this sum was to be expanded by the deceased for his needs and wants, the estate can not benefit from it. For this reason this sum must be deducted from the nett pay.

[85] Ms Narayan submitted that in arriving at this figure, I must deduct all the expenses which the deceased had for himself and the other dependants. Certainly, that is incorrect. If it is to be adopted, it will give an inconsistent result to that laid down Daya Ram -v- Peni Cara (supra). It is only the personal expenses of the deceased which is to be excluded.

[86] Ms Narayan submits a discount of 50%. However, that ratio is based on the expenses including the amount he spent for the dependants, that is the mother, brother and sisters. However, the ratio as pitched by Ms Narayan depicts that the deceased expenditure was less than 50% of nett-income once the amount expanded for the dependants is excluded. In any event, her submission confirms that 50% of the salary was saved for the benefit of the estate.

[87] On the other hand the plaintiff submitted that after the death of the father in 1987, the deceased took over the responsibility of maintaining and looking after the mother brother and sisters. Prasad testified that the deceased was a "father like figure for him."

[88] The deceased was non-smoker and a reserved person. He was a teetotaller. Nor did he drink kava. His expenses were the fare to travel to and back from work. Undoubtedly he would have spent money on wearing apparels, food and other sundry expenses. In assessing this figure, I must give due consideration of the fact that he was one of the Director of the company. From time to time he would have contributed the money to office functions for the employees. Some money must have been utilised for his own entertainment. Bearing all this factors in to account, Ms Neelta impressed upon me to adopt the approach taken in Hem Raj -v- Netani Vetaia & Ors, Labasa High Court Civil Action No. HBC 0068/1995 and Anjula Wati -v- Vakatora Holdings Limited and others Civil Action No. 244/1995. There the Court allowed one third of the net sum for personal expenditure of the deceased. In considering the evidence before me, I will allow 40% to the deceased and 60% for the benefit of the estate.

[89] Based on a ratio of 40% to 60% the deceased would spend a sum of $13,412-26 and $20,118-38 would be left for the benefit of the Estate.

[90] Next question is for how long would this income be available. For assessment of damages, this is ascertained by a multiplier.

[91] A multiplier is the finite duration over which the annuities for the benefit of estate will be available.

[92] A multiplier is derived from the evidence of the deceased’s health and age. Age in this context is limited to "working age". Ordinarily, a person is deemed to have retired at an age of 60 years. However, to continue working for that period, it is important to note that there are many contingencies and vicissitudes of life. One may not live for that long. S/he may lose the job, thus the earning or earning capacity. Bearing all this in mind, in Attorney General –v- Edward Michael Broadbridge the Supreme Court suggested that a discount of one third be allowed for the duration of the working life of a person. Multiplier also takes into account that all future payment are paid in advance in lump sum. Accordingly, the recipients are to invest the said sum thus receiving dividends from the same.

[93] In this case the deceased was 35 years old at the time of the accident. He had a further 25 years of working life left in him. Applying the formula based in Broadbridge, the duration be reduced by 8.3 years. That is a total working life 16.6 years applies.

[94] However, in Fiji, Multiplier is not given over 16 years; Attorney General -v- Paul Parvin Sharma Court of Appeal Civil Appeal No. 728/84. Sixteen years in any event is reserved for young persons between the age of 15 – 25 years.

[95] In Attorney General -v- Paul Parveen Sharma, (supra) the retirement age was based at 55 years. It overlooked to take into account that retirement age in this country is 60 years. Because of that, in my view the fixing of multiplier at the highest level of 16 must be reviewed by the Appellant Courts. The approach suggested and applied in Broadbridge seems to achieve a fair result. At least it is a fair and just means to an end.

[96] In any event, I am bound by the authoritative decision of the Appellate Court on the multiplier. Attorney General –v- Paul Parvin Sharma (supra) still remains the law on the multiplier. Ms Neelta seeks a multiplier of 16, and Ms Narayan 13. It is not so far apart. For comparative analysis the Courts have given the following multipliers to persons around the age of the deceased:-

Action No.	Parties	Age at death	Multiplier
ABU 0046/95 (Court of Appeal)	Ratu Isei Turaga –v- Helen Nina Work	36	14
C/A 373/1979 (Suva H/C)	Subamma -v- Chandra	34	16
C/A No. 407/97	Mono Lata -v- Janla Prasad	36	14
C/A 242/903S	Jaipal Singh -v- Ted Young	29	14
C/A 077/02S	Suman Lata -v- Enkaiya Narayan & Ors.	31	13
ABU 85/85 (Court of Appeal)	Josefa Sigavolavola –v- Giyan Mati	30	15
C/A 611/93S	Jai Narayan –v- Attorney General	33	11
C/A 40/96L	Bihi Nanson –v- Ramesh Chand	33	10

[97] Having considered the range of multipliers applied by different Courts, together with the plaintiff’s unremarkable health condition and the likely dividends to be received from investment of funds now to be paid in lump sum. I will allow a multiplier of 13. I have considered the fact that the deceased was a founder of the Company. The prospect of him leaving the Company would have necessitated a much better offer. Further, he as a Director of a Company has done reasonably well. The Company has cash in the bank, as shown by the ANZ bank statement tendered in Court. On top of this, the deceased was pursuing further education in obtaining an accounting degree. Ordinarily accountants work beyond the retirement age. If no employment is available, they operate business as Accountants. On this basis, I will allow a multiplier of 13 as submitted by Ms Narayan.

[98] Therefore the estates benefit is the product of the multiplier and multiplicand. That is the product of 13 (multiplier) when multiplied by $20,118-38 (multiplicand), which sum amounts to $261,538-99.

[99] A sum of $2,500-00 being the loss of expectation of life needs to be deducted under the principle in Davies –v- Powell Duffryn Associated Collieres Ltd. [1942] AC 601 and was reaffirmed by the Court of Appeal in the Medical Superintendent -v- Abdul Hafiz Ismail, (supra). Thereafter the total loss to the Estate amounts to $259,038-99.

[100] Ms Neelta also seeks the payment of the employer’s contribution of the Fiji National Provident Fund. Such a claim is permissible; Alusio Daino -v- Attorney General Suva High Court Civil Action No. 515/1996. Ms Narayan concedes to the payment of FNPF.

[101] Presently, the employer’s contribution is 8% of the gross salary. In this instance, 8% of the gross salary of $24,984-96 multiplied by a multiplier of 14. That is $25,984-36.

[102] Just for the sake of completeness, I have not allowed FNPF on the Director’s fee or emoluments. FNPF is payable only on salaries and wages. Director’s fee does not attract any FNPF nor was any such contribution made by MISEL.

[103] Interest is payable on the past losses and special damages. On the award of interest, Ms. Narayan relies on Attorney General –v- Charles Valentine, Court of Appeal Civil Appeal No. 19/98. The principle in that case is exclusive to personal injury claims and not fatal accidents. There is a marked distinction between the two.

(b) lost years – The award must be split in two parts interest is only payable for the period between the filing of the writ and date of judgment.

(d) After the judgment, interest continues to accrue at rate of 4% per annum pursuant to S. 17 of the Imperial Judgments Act 1838; Suresh Charan –v- Suva City Council Civil Appeal No. 12/89.

[105] In this case I will allow the interest at a rate of 5% per annum. Therefore, interest accrued on special damages of $2,900-00 accrued from 22nd October, 2005 to 19th December, 2008, at a rate of 5% per annum, which sum is $365.98. Apply the multiplicand of 20,118-18, the loss has continued from 25th October, 2005. Since the Director’s fee for 2006 was paid in advance, I have to give discount for this. A further discount of one third of the multiplicand for the past loses will adjust the past loses. Then effectively past loses will be only for two and half years. It amounts to $50,295-95.

[106] Interest on "lost year" is calculated from 29th December, 2006 to 19th December, 2006. At a rate of 5% per annum the interest for the duration amounts to $4,023-68. I have taken into account the fact the Director’s fee was paid in advance upto, 2006. Thus the past loss of Director’s fee is for the year 2007 and 2008 only. Loss of salary remains from date of death (22/10/2008) to 19th December, 2009.

[107] After the assessment I adjourned the action for judgment on notice. I had indicated to Mr Nagin when he appeared before me in another matter that the judgment would be delivered in December. Despite that the parties attempted to file a terms of settlement without the leave of the Court. Order 21 Rules 2(7) and 3 does not allow parties to do so after a trial without the leave of the Court. It states:-

"2(7) – If all the parties to an action consent, the action may be withdrawn without the leave of the Court at anytime before trial by written consent to the action being withdrawn signed by all the parties.

Further Rule 3 expressly forbids discontinuance without the leave of the Court. It states:-

21/3 3.—(1) Except as provided by rule 2, a party may not discontinue an action (whether begun by writ or otherwise) or counterclaim, or withdraw any particular claim made by him therein, without the leave of the Court, and the Court hearing an application for the grant of such leave may order the action or counterclaim to be discontinued, or any particular claim made therein to be struck out, as against any or all of the parties against whom it is brought or made on such terms as to costs, the bringing of a subsequent action or otherwise as it thinks just.

(2) An application for the grant of leave under this rule may be made by summons or motion or by notice under Order 25, rule 7.

No such summons or motion was filed before the parties attempted to file the terms of settlement. I leave the issue for the counsel and parties to deal with. If any direction is needed from the Court parties are at liberty to apply. But for the time being the Court’s assessment is summarised below in the conclusion.

(a) Special damages	= $ 2,900-00
Interest on special damages	= 365-98
(b) Loss of expectation of life	= $ 2,500-00
(c) Loss of earning for lost years i) Less	$261,538-99 $2,500-00
	= $259,038-97
(d) Interest for past loss $50,295-92	= $ 4,023-62
(e) FNPF Contribution	= $25,984-36
Total award	= $294,312-93

[109] The plaintiff is entitled to costs. Since the defendant had admitted liability, due consideration must be given to that. However, two days was spent for the amount of damages. I will award costs to the plaintiff in the sum of $2,500-00 for the assessment of damages. Had liability been admitted this costs may have been double.

[110] Accordingly, I give a judgment to the plaintiff in the sum of $297,312-93 inclusive of costs.

(a) Salary	$24,984-96
(b) Director’s fee	$20,000-00
	*$44,984-96*

Gross income	$44,98490
Tax rebate (FNPF)	1,50000
Chargeable Income	*$43,48498*

High Court of Fiji

Prasad v Hakim [2008] FJHC 359; HBC370.2006 (19 December 2008)