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Sun Insurance Company Ltd v Khan [2012] FJHC 27; HBA001.2011 (20 January 2012)

IN THE HIGH COURT OF FIJI AT LABASA
APPELLATE JURISDICTION

CASE NUMBER: HBA 001 of 2011

BETWEEN:

SUN INSURANCE COMPANY LIMITED
APPELLANT

AND:

FAROM FAIYAZ KHAN
RESPONDENT

Appearances: Mr. A. Ram for the appellant.
Mr. A. Sen for the respondent.
Date/Place of Judgment : Friday, 20th January, 2012 at Labasa.
Coram : The Hon. Justice Anjala Wati.

JUDGMENT

CATCHWORDS:

Civil appeal –award of costs- discretion to award costs- powers to make summary assessment- scale of costs- interference with award of cost: by appellate court.

LEGISLATION:

The Magistrates' Courts Rules, CAP 14; Order I Rule 5, Order XIV Rule 1, Order XXVIII Rule 1, XXXIII Rule 2 and 3.

1. This is an appeal against an order for costs of $1000 ordered by the lower Court when the appellant sought an adjournment of a hearing date on the basis that it needed to amend its defence as some evidence had come to light lately.
   
2. The Court allowed the adjournment and the amendment on the basis that it was important to identify the real questions in controversy. The cost was ordered on the basis that there was no explanation for the delay in making an application for amendment and that there were three witnesses of the respondent present on the day for the hearing. It was therefore reasonable to order a cost of $1000 to the respondent.
   
3. Aggrieved with the award of costs, the appellant appealed on the grounds that the learned Magistrate erred in law and in fact:
   
   • In failing to exercise his discretion judicially in awarding the amount of $1000;
   • In assessing the amount of costs and failed to consider the facts and evidence / or the lack of it before him;
   • In not giving any reasons why he awarded such high costs;
   • In exercising his discretion in fixing the amount of the award having regard to the scale of costs provided for in the Magistrate's Courts Rules.
   • In awarding an excessive amount of costs.
   • In his award of costs having regard to the nature of the cause or matter in relation to which such costs were awarded.
     
4. Mr. Ram, counsel for the appellant submitted that:-
   
   • (a) The costs awarded is too high when one has regard to the scale of costs and the facts of the case, in that, on the day in question, 3 local witnesses were in Court, for the respondent. The travelling costs would not have exceeded $20.00 for the witnesses.
     
   • (b) The award is inconsistent with other awards. There has to be judicial consistency. Two examples were mentioned. One was the case of NLTB v. Dogotuki Housing Ltd, Magistrates Court Civil Action No. 117of 2008. Mr. Ram said he appeared for the defendant in this case. A lawyer had come all the way from Suva but the matter could not proceed. Only $100 cost was granted. The second example was given of the case of Vishwa Nand v. Bhawan Singh, Magistrates Court Civil Action No. 177 of 2009. This case, Mr. Ram said, involves the same Magistrate who granted an order in this case. Mr. Ram stated that the order in that case was made on 16th November 2010. The current order was made on 21st May 2010. The counsels were same in the other case. On 16th November, 2010, the hearing was adjourned in the other case and the same counsel got cost of $150.00.
     
   • (c) Normally the cost for whole the trial ranges between $750 to $2000 in the Magistrates' Court. In this case, no reasons were given for such high costs.
     
5. Mr. Sen, counsel for the respondent submitted that:-
   
   • (a) The history of the proceedings shows the misconduct and delay of a financially capable organization which wishes to run the Court proceedings on its own terms. The delay effectively throughout the proceedings and the conduct of the appellant justifies the costs. His whole day was set aside for the trial. The appellant's counsel should have at least fore- warned him of the proposed adjournment and amendment application.
     
   • (b) Granting of cost is a discretionary matter and the appeal Court cannot interfere with the exercise of such discretion.
     
   • (c) Interlocutory appeals are and must be discouraged. This is a 2009 matter and the case is not heard as yet. The accident took place in the year 2003. It is now 8 years and the case is not heard.
     
   • (d) Costs granted in other cases were justified on its facts and in a case where he was involved, he had consented to costs and so those cases must not be used to assess costs in this case.
     
   • (e) The cost granted was for amendment and adjournment as well.
     
6. Mr. Ram responded that $1000 cost was not for the entire case but for adjournment and amendment only. Cost must be compensatory in nature and not a money making exercise.
   
7. It is evident that the costs of $1000 granted on the day in question was for two reasons; for grant of adjournment and for late amendment, that is, amendment on the day of the trial.
   
8. Amendment can be granted upon such terms as to costs pursuant to Order XIV Rule 1 of the Magistrates' Courts' Rules, Cap. 14. The power to order cost is an unfettered discretion of the Court.
   
9. Order XXVIII Rule 1 of the Magistrates' Courts Rules, also gives powers to the Court to allow postponement of hearing on such terms as the Court deems just. The words "such terms" is wide enough to include the terms as to costs.
   
10. Order XXXIII gives the Court a general discretion on making award of costs. Rule 2 states that all questions relating to the amount of costs shall, unless specifically referred for taxation, be summarily determined by the Court. Rule 3 states that costs of every suit or matter and of each particular proceeding therein shall be in the discretion of the Court, and the Court shall have full power to award and apportion costs, in any manner it may deem just.
    
11. The scale of cost pursuant to Order I Rule 5 of the Magistrates' Courts' Rules is applicable to taxation of costs.
    
12. In this case, the Court had made summary assessment of costs and in my judgment it had the powers to order an amount beyond the prescribed amount in the scale.
    
13. It is evident that Mr. Sen was fully prepared for the trial. He must have spent time to prepare his case leaving aside the rest of his work. Thus on the hearing date his efforts are wasted because he still has to re-prepare for another hearing because an additional defence will come up. More so, he will now have to seek fresh instructions to file a fresh reply to the new defence. He will be put to additional task to prepare for pre-trial conference issues. His each witness not only had wasted their travelling expenses but other expenses such as meals and their precious time. They need to be compensated for that and for re-preparing them. All these are hidden costs that will arise as a result of the amendment and the adjournment, not overlooking the Court fees, Mr. Sen has to pay for filing new documents and consumption of resources.
    
14. In the circumstances, I do not think proper to interfere with the discretion of the Magistrate for the award made. All awards depend on the facts of the case and in this case it was proper for the Court to go beyond the scale of costs. The proposed amendment was an eleventh hour exercise. If the appellant company was diligent in carrying out its investigations, it would have found the evidence of the conviction which they say is a new evidence which they intend to incorporate in its defence. The Court cannot allow big corporate organizations to start investigating and hunting for evidence just before trial. As a financially capable and independent organization, it ought to have acted early and its delay should not prejudice the respondent.
    
15. His worship may not have apportioned the costs but he gave few reasons like delayed application and witnesses costs as the basis for the grant. As I have enlisted above, there are more hidden costs than those mentioned by his worship and if all are accounted, the quantum is not in error of law or fact.
    
16. This appeal has no basis and I dismiss the same.
    
17. The appeal was short and simple and not much time has been spent on argument of the same. For the respondent, no filing fees were involved.
    
18. I therefore only make a nominal order for costs in the sum of $250 in favour of the respondent.
    
19. Orders accordingly.
    

Anjala Wati
Judge
20.01.2012

To:

1. Mr. A. Ram, counsel for the appellant.
2. Mr. A. Sen, counsel for the respondent.
3. File: HBA 001 of 2011.