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Australia And New Zealand Banking Group Ltd v Kelton Investments Ltd [2012] FJHC 928; HBC134.2002 (9 March 2012)

IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION

CASE NUMBER: HBC 134 OF 2002

BETWEEN:

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED
APPELLANT

AND:

KELTON INVESTMENTS LIMITED
1ST RESPONDENT

AND:

KELTON MARKETING (FIJI) LIMITED
2ND RESPONDENT

AND:

PAPERCHASE LIMITED
3RD RESPONDENT

AND:

INDUSTRIAL TECHNOLOGY (FIJI) LIMITED
4TH RESPONDENT

AND:

NAIGANI RESORTS LIMITED
5TH RESPONDENT

AND:

JAMES MICHAEL AH KOY
6TH RESPONDENT

AND:

MICHAEL JAMES AH KOY
7TH RESPONDENT

AND:

ANTHONY EUGENE AH KOY
8TH RESPONDENT

Appearances: Mr. S. Singh, for the appellant.
Mr. K. Muaror, for the respondents.
Date / Place of Judgment: Friday, 09th March, 2012 at Suva.
Coram: The Hon. Justice Anjala Wati.

JUDGMENT

CATCHWORDS:

LEAVE TO APPEAL – AGAINST ORDER OF AMENDMENT – LEAVE REFUSED ON GROUNDS THAT THERE IS NO QUESTION OF GENERAL IMPORTANCE OR ANY DIFFILCUT QUESTION OF LAW INVOLVED - NEITHER PARTY HAS THE SUBSTANTIVE RIGHTS AFFECTED AND SO GRANT OF LEAVE WOULD BE FUTILE.

LEGISLATION:
THE HIGH COURT RULES, 1988: ORDER 20 RULE 5(5).

CASES:
Niemann v. Electronic Industries Limited [1978] VicRp 44; (1978) VR 431.

1. On the 1st day of July, 2011 I had granted an order for amendment of the plaintiffs claim on the grounds that the proposed amendment sought to particularise and give efficacy to the existing causes of actions against the defendant. I had noted that the causes of action had not changed and that the proposed amendment clarified how the other plaintiffs were connected to the same cause of action.
   
2. The appellant seeks the Courts leave to appeal against the order for amendment on the grounds that the Court has erred in a number of ways in allowing the amendment. I need not consider the grounds of appeal and the prospects of its success and so I consider it unnecessary to outline the proposed grounds.
   
3. In arguing the leave application, Mr. Singh submitted that:-
   
   • (a) The judgment has had the effect of determining a substantive right of the appellant to a defence under the Limitations Act and Fair Trading Decree in respect of allegations based on section 54 of the Fair Trading Decree. Most, if not all amendments sought by the respondents are statute barred.
     
   • (b) There are issues of general importance involved in this matter. The issue of whether the Court ought to allow parties to amend their pleadings to bring in statute barred causes of actions after significant delays and with no explanation at all for the significant delays is an issue of general importance. The manner in which a Court ought to consider an application for leave for further amendment under Order 20 Rule 5(5) has not been considered properly by the Fiji Courts and would be an issue of general importance for the Court of Appeal to consider. There is no legal authority in Fiji which actually provides for the criteria under which a Court must exercise its discretion under Order 20 Rule 5(5) in respect of statute barred causes of actions after lengthy delays. A decision from the Court of Appeal in this regard would be helpful to both practitioners and the other Courts.
     
   • (c) The proposed appeal concerns difficult questions of law in which the Courts have expressed differing views from time to time. The English position on amendments where proposed amendments are statute barred is that the Curt must not allow an amendment which would deprive a defendant of its defence under the Limitation Act.
     
   • (d) The appellant has good arguable grounds of appeal and should be given an opportunity to argue those grounds before the Court of Appeal.
     
4. Mr. Muaror argued that the proposed amendment arises from the same facts as originally pleaded. The order for amendment allows the parties to argue the real case in controversy. It does not determine the rights of the parties.
   
5. The law on leave to appeal against an interlocutory order is aptly stated by Murphy J. in the case of Niemann v. Electronic Industries Limited [1978] VicRp 44; (1978) VR 431. Murphy J stated:-
   

"Likewise in Perry v. Smith [1901] ArgusLawRp 51; (1901), 27 V.L.R. 66 and the Darrel Lea Case [1969] VicRp 50; (1969) V.R. 401, the Full Court held that leave should only be granted to appeal from an interlocutory judgment or order, in cases where substantial injustice is done by the judgment or order itself. If the order was correct then it follows that the substantial injustice could not follow. If the order is seen to be clearly wrong, this alone is not sufficient. It must be shown, in addition, to effect a substantial injustice by its operation.

It appears to me that great emphasis therefore must lie on the issue of substantial injustice directly consequent on the order. Accordingly, if the effect of the order is to change substantive rights, or finally put an end to the action, so as to effect a substantial injustice if the order was wrong, it may more easily be seen that leave to appeal should be given. Indeed this approach seems to have been adopted in the Darrel Lea Case.

It also seems to me important to note that the judge who makes the interlocutory order or judgment may be in a different position, when considering whether to grant leave to appeal from his order or judgment from that in which the Full Court finds when considering a similar application.

He has tried the case, whatever it may be. He has made the interlocutory order or given the interlocutory judgment. He could not be expected, when considering whether or not to grant an application for leave to appeal, to say that his order or judgment was clearly wrong and that substantial injustice would follow if it were undisturbed. If those criteria had in all cases to be established, leave would never be granted by the primary judge.

In practice, he may consider (1) whether the issue raised is one of general importance or whether it simply depends upon the facts of the particular case; (2) whether there are involved in the case difficult questions of law, upon which different views have been expressed from time to time or as to which he has been 'sorely troubled'; (3) whether the order made has the effect of altering the substantive rights of the parties or either of them; and (4) that as a general rule there is a strong presumption against granting leave to appeal from interlocutory orders or judgments which do not either directly or by their practical effect finally determine substantive rights of either party.

When the matter comes before the Full Court on a motion for leave to appeal from the interlocutory judgment, it seems to me that different considerations should apply.

Those considerations are expressed in Perry v. Smith [1901] ArgusLawRp 51; (1901), 27 V.L.R. 66, and the Darrel Lea Case[1969] VicRp 50; , (1969) V.R. 401, in clear terms, although the use of the word "wrong" in the first test may allow of some debate.

On an application for "leave" the Full Court ought not, in my opinion, to be required, before granting leave, to determine the issue in question, or to decide whether the primary judge's discretion miscarried. That would be to duplicate the work of the Court. The requirement for leave is designed to reduce appeals from interlocutory orders as much as possible. If leave can only be granted, following an examination of the merits of the matter and a decision that the order made by the primary judge was "wrong", and the matter goes then to be decided on the merits by another Full Court, the object of the legislature is negated, and absurdity is the result. Cf. Lane v. Esdaile, [1891] UKLawRpAC 11; (1891) A.C. 210, per Lord Halsbury L.C. at p. 212.

It therefore appears to me that in using the word "wrong" in Perry v. Smith and in the Darrel Lea Case, the Full Court must have used it in a sense which included decisions "attended with sufficient doubt", to use the privy Council phrase, from which decisions substantial injustice flowed."

6. I propose to follow the guidelines set out above to determine the issue of leave. The first two factors are whether the issue raised is one of general importance or whether it simply depends upon the facts of this case or whether there are involved in the case difficult questions of law, upon which different views have been expressed from time to time or as to which I have been 'sorely troubled'.
   
7. This is neither a case which is of general importance nor a case where any difficult question of law is involved. The issue is that of an amendment of a statement of claim after the expiration of the limitation period. The relevant legislative provision under which such amendment, as I allowed, is contained in Order 20 Rule 5(5) of the High Court Rules, 1988.
   

"Order 20 rule 5(5) — An amendment may be allowed under paragraph (2) not withstanding that the effect of the amendment will be to add or substitute a new cause of action if the new cause of action arises out of the same facts or substantially the same facts as a cause of action in respect of which relief has already been claimed in the action by the party applying for leave to make the amendment".

8. Mr. Singh argued that the initial claim did not plead a cause of action between certain respondents and the appellant. This has always been the qualm of the appellant, for the respondents to show how the other respondents are involved in the claim. The respondents then, properly, albeit late, are saying that the cause of action arises out of the same facts and is the same for all. This is absolutely permitted under Order 20 Rule 5 (5).
   
9. There is no magic or ambiguity in analysing Order 20 Rule 5(5) to the facts of this case. The issue is simple and straight forward. The amendment does not introduce a new claim. It also does not add or substitute a party. It states how the parties are connected to the original claim and so the amendment was perfectly proper under the said legislative provision.
   
10. The amendment also does not affect the substantive rights of the appellant. If anything, it opens a forum for a real issue in controversy to be argued in Court. The appellant's concern that its right to argue its limitation defence is taken away is not a proper contention.
    
11. The powers exercised under Order 20 rule 5(5) in no way affects or prejudices the substantive rights under the Limitation Act.
    
12. The principle underlying the powers of the Court under r.5 is that if the proceedings had been, from the beginning, properly formulated or constituted, the defence of limitation would not have been available to the defendant; and accordingly, if in its discretion, the Court thinks it just to grant leave to amend defects in the writ or pleading within the scope of the circumstances specified, so that such defects in the proceedings are treated as having been cured ab initio, the defendant is not being deprived of the benefit of a defence which he would not have had if the proceedings had been so properly formulated or constituted in the first place. To contend that the defendant has an existing right which will be prejudiced by the amendment is to argue in a circle, since he only has an existing right if one presupposes that the Court will not use its powers to amend.
    
13. In any event, the defendants are always at liberty to raise the issue of the Limitation Act and other statutory defences and have the defence tried and if it fails, their right to appeal survives after the final verdict.
    
14. Granting leave to appeal is an exercise in futility. Further delays will occur which the appellant itself is concerned about. I do not see any prejudice to any party in refusing leave to appeal.
    
15. The application for leave to appeal has no merits and as such it ought to be refused with an order for costs to the respondents in the sum of $550.
    
16. Orders accordingly.
    

Anjala Wati
Judge

09.03. 2012

To:

1. Mr. S. Singh, for the appellant;
2. Mr. K. Muaror, for the respondents; and
3. File: HBC 134 of 2002.