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Aaryan Enterprise v Mehak Unique Fashion [2011] FJHC 727; Civil Appeal 17.2011 (10 November 2011)

IN THE HIGH COURT OF FIJI
AT SUVA
APPELLATE JURISDICTION

CIVIL APPEAL NO. 17 OF 2011
(Magistrates Court Misc.No.6 of 2010)
(Small Claims Tribunal No. 1820/2010)

BETWEEN:

AARYAN ENTERPRISE
Appellant

AND:

MEHAK UNIQUE FASHION
Respondent

Mr R Naidu for the Appellant
Ms M Ligabalavu for the Respondent

JUDGMENT

On 20 July 2010 the Appellant lodged a claim for $3081.94 against the Respondent in the Small Claims Tribunal. The claim was made in respect of goods supplied by the Appellant to the Respondent. The Respondent had failed to pay the amount owing despite attempts by the Appellant to recover the debt.

On 6 October 2010 the Referee of the Small Claims Tribunal ordered the Respondent to pay an amount of $450.00 per month commencing on 31 October 2010 until the sum of $2701.94 was paid in full. In default of any installment the balance that remained owing would become due and payable. The payments were required to be made to the Small Claims Tribunal.

By Notice of Motion dated 29 October 2010 and filed on 8 November 2010 the Respondent sought an order seeking leave to file its Notice of Appeal out of time. The application was supported by an affidavit sworn by Hansukh Darji sworn on 29 October 2010. Attached to the affidavit was a draft Notice of Appeal that stated that the Respondent was appealing the decision of the Tribunal on the basis that the proceedings were conducted by the Referee in a manner which was unfair to the Respondent and prejudicially affected the result of the proceedings. Neither the affidavit nor the Notice of appeal provided any particulars as to the alleged unfair manner in which the proceedings had been conducted.

In his supporting affidavit the deponent acknowledged that as at 29 October 2010 the time for lodging an appeal was already 8 days out of time which under section 33 (3) of the Small Claims Tribunal Decree 1991 was 14 days from the date of the Order of the Tribunal. There was no explanation in the affidavit for the failure to lodge the appeal within the prescribed time.

A preliminary issue concerned whether an application for an extension of time to lodge an appeal could be entertained by the Magistrates Court. The matter was discussed by Scott J (as he then was) in Chan Long Chong and Ye Hui Fang –v- Yen Yain Kai [1999] 45 FLR 217. His Lordship stated at page 218:

"Section 33 (2) of the Decree requires appeals against the decisions of referees to be brought in the Magistrates Court while section 33(3) requires such an appeal to be brought within 14 days of the order against which it is desired to appeal. There is no provision within the Decree or the Small Claims Tribunal Rules for the period of 14 days to be extended but as previously pointed out the Small Claims Tribunal is a division of the Magistrates Courts and therefore it is reasonable to look to the Magistrates Courts Act and _ _ _ Rules for guidance."

As a result I am satisfied that Order XXXVII Rule 4 gives the power to a Magistrates Court to extend the 14 days period to appeal from a decision of Small Claims Tribunals which are analogous to the "Courts below" being a reference to courts presided over by Second or Third Class Magistrates and which have ceased to exist.

In a written Ruling dated 26 April 2011 the learned Magistrate noted that the delay in appealing was 19 days which she described as extensive. The learned Magistrate also noted that the Respondent had not provided any reasons for the delay. After considering the legal principles to be applied and Counsel's submissions, the learned Magistrate granted leave to the Respondent to file an appeal out of time and ordered the Respondent to pay to the Appellant costs of $200 within 14 days.

In paragraph 29 of her decision the learned Magistrate summarised the reason for her decision:

"The Respondent is entitled to the fruits of its judgment. However, without the Small Claims Tribunal Record and the Brief of the Referee, I am unable to determine the issue of a fair trial. In the event that there is a denial of natural justice, then the Applicant would have a reasonable chance of success in their appeal. If not, then costs on the appeal would take care of any prejudice against the Respondent."

The Appellant now seeks to appeal the decision of the learned Magistrate. A Notice of Intention to Appeal dated 26 April 2011 was filed on 2 May 2011. The Grounds of Appeal subsequently filed on 20 May 2011 were stated as being:

"1. The learned Magistrate erred in law in granting the respondent Mehak Unique Fashion an extension of time to file its appeal out of time when:

(i) The respondent failed to provide any reasons for the delay (which delay was extensive).

(ii) The Respondent failed to show that the proceedings in the Small Claims Tribunal was conducted by the referee in a manner that was unfair to the applicant and prejudicially affected the result of the proceedings. The respondents grounds of appeal and affidavit in support of the application for leave to appeal out of time did not identify any form of unfairness and its effect on the result of the proceedings.

(iii) The respondents proposed grounds of appeal did not have reasonable prospects of success.

2. The learned magistrate failed to exercise her discretion properly."

The right of appeal to this Court from an interlocutory decision in the Magistrates Court is given by section 36 of the Magistrates Court Act. Under section 39 of the same Act the High Court may entertain any appeal from a Magistrates Court on any terms which it thinks just.

The powers of the High Court sitting as an appellate court from a decision of a Magistrates Court are set out in Order XXXVII Rules 18 and 19. In particular Rule 18 states:

"The appellate court _ _ _, generally, shall have as full jurisdiction over the whole proceedings as if the proceedings had been instituted and prosecuted in the appellate court as a court of first instance, and may rehear the whole case or may remit to the court below to be reheard, or to be otherwise dealt with as the appellate court directs."

Then Rule 19 goes on to state:

"The appellate court shall have power to give any judgment and make any order that ought to have been made, and to make such further or other orders as the case may require, including any order as to costs. _ _ _"

In my judgment the jurisdiction conferred on this Court as an appellate court under Order XXXVII to hear appeals from the Magistrates Court entitles the Court to consider the matter in question as a court of first instance (i.e. afresh) unfettered by the decision of the learned Magistrate and as a result, I am entitled to exercise my own discretion. Under Order XXXVII I am not restricted to reviewing the manner in which the learned Magistrate exercised her discretion. (See CM Van Stillevoldt BV –v- EC Caviers Inc [1983] 1 All ER 699).

The general principles for determining an application for an extension of time to appeal are well known. The principal factors taken into account are (1) the length of the delay, (2) the reasons for the delay, (3) the chances of an appeal succeeding if the time for appealing is extended and (4) the degree of prejudice if the application is granted.

Although the proceedings in the Small Claims Tribunal are informal, nevertheless the applicant is required to place before the Court material in support of its application, usually by an affidavit.

In this application I am compelled to indicate that even if my task had been to consider whether the learned Magistrate had erred in her approach to the exercise of her discretion, the conclusion that I have reached would be the same. In exercising my own discretion in this case I have come to a conclusion that is different to that which the learned Magistrate reached.

Looking at the factors in this case, first the length of delay was 19 days and was described by the learned Magistrate as extensive. I would also describe the delay in the same way. There was no explanation for the delay in the affidavit of Harsukh Darji. I am certainly of the view that the longer the delay, the greater is the requirement to provide not only an explanation but a reasonable explanation. In Tevita Fa –v- Tradewinds Marine Ltd and Another (unreported civil appeal No. 40 of 1994 delivered on 18 November 1994) Thompson JA sitting as a single judge said at page 3:

"The application for leave to appeal was filed only 4 days after the end of the period of six weeks. That is a very short time but time limits are set with the intention that they should be observed and even lateness of only a four days requires a satisfactory explanation before an extension of time can properly be granted."

The learned Magistrate acknowledged both the length of the delay and the absence of any explanation for the delay. The next factor is the chances of an appeal succeeding in the event that an extension of time is granted. The learned Magistrate appeared to consider this factor to be decisive. I for my part cannot come to the same conclusion.

The learned Magistrate correctly identified the limited grounds of appeal that are available to an aggrieved party under the Decree. The learned Magistrate stated in her Ruling that Counsel for the Applicant had indicated during the course of his submissions that the ground relied upon was that the proceedings were conducted by the Referee in a manner which was unfair to the appellant and prejudicially affected the result of the proceedings. In essence the ground allows for an appeal to the Magistrates on the grounds that the appellant has been denied natural justice in the form of procedural fairness which has prejudicially affected the result of the proceedings. The other allowable ground of appeal under the Decree is that the Tribunal exceeded its jurisdiction. Together they represent a limitation on the general principle that an appellant's right to appeal is as of right in respect of an error of law and/or fact. It is a right of appeal which requires the appellate court (the Magistrates Court) to review the proceedings conducted by the Referee in the Small Claims Tribunal and determine whether the applicant's complaint has any merit. There is certainly no right of appeal in respect of any error of law nor in respect of any factual error. The procedure to be adopted is clearly one of review and not one of re-hearing.

Under the grounds of appeal relied upon the Respondent was required to identify some unfairness in the manner (form) of the hearing before the Tribunal and not simply the result. Put bluntly, there is no right of appeal on the merits even when there may be a clear error of law in the Tribunal's decision.

The proposed ground of appeal in respect of the Tribunal's decision states no more than the ground itself without any particulars being provided as to the alleged unfairness in the manner or form of the hearing. There is nothing in the affidavit to indicate how the hearing was alleged to have been conducted in an unfair manner. There was no material for either the learned Magistrate nor this Court to determine how the Appellant was prejudicially affected because the unfair manner has not been identified. Under these circumstances it is impossible for this Court to determine what are the chances of the appeal succeeding.

The learned Magistrate appears to have placed some reliance on submissions made by Counsel from the Bar Table. However those matters have not been stated in her Ruling.

The onus was on the Respondent to establish at least reasonable prospects of success in the appeal. In my judgment the Respondent did not discharge the burden and in fact failed to establish any basis for concluding that the appeal had reasonable prospects of succeeding.

The question of prejudice does not arise in view of the failure of the Respondent to adequately explain the extensive delay of 19 days and to demonstrate any reasonable prospect of succeeding in the appeal.

For all of the above reasons I have concluded that the appeal should be allowed. The orders granting an extension of time made by the learned Magistrate are set aside. The Respondent in these proceedings (Mehak Unique Fashion) is ordered to pay the costs awarded in the court below and the costs in this application which are fixed summarily in the sum of $800.00.

W D Calanchini
JUDGE

10 November 2011
At Suva