IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION

Civil Action No. HBC 193 of 2009
in High Court Lautoka

IN THE MATTER of an Appeal from the Ruling made by the Master of the Court MR ANARE TUILEVUKA of Lautoka High Court dated 20th day of August 2010 in Civil Action No. HBC 193 of 2009.

BETWEEN:

SIDDIQ FAIZAL KOYA and MUBARKA KOYA both of Flat 3, Lot 8, ATS Sub-division, Namaka, Nadi, Magistrate and Businesswoman respectively.
APPELANTS/DEFENDANTS

AND:

DOMINION FINANCE LIMITED a limited liability company having its registered office in Suva.
RESPONDENT/PLAINTIFF

APPEARANCES : Mr P Sharma of R Patel Lawyers for Dominion Finance Ltd

Ms T Draunidalo of Iqbal Khan & Ass for Mr Siddiq Faizal Koya & Mrs Mubarka Koya 

Date of Hearing: 7th February, 2012
Date of Judgement: 9th March, 2012

JUDGEMENT

 Introduction
1.	This case was originally taken up before Justice Y. I. Fernando in the High Court of Lautoka and was transferred to High Court of Suva for 'de novo' hearing of the appeals.

2.	Both parties have appealed against the summary judgement entered on 20th August 2010 by Master Mr Anare Tuilevuka in Case No. HBC 193 of 2009 in High Court of Lautoka.

3.	When this matter came up before me it was decided to consolidate both appeals and deliver one Judgement. This was agreed in the High Court of Lautoka too, by the Counsel for both parties.

Background

4.	Dominion Finance Limited (the Plaintiff) filed Writ of Summons case on 6th October 2009 in the High Court of Fiji at Lautoka against Siddiq Faizal Koya and Mubarka Koya (Defendants) claiming $87,563.23 and praying for other reliefs in the Statement of Claim on a loan facility granted by the Plaintiff to Euro Parts (Fiji) Limited (hereinafter called and referred to as EFL) and the said loan is secured by Personal Guarantee of both Defendants by executing a Deed of Guarantee. The said Deed of Guarantee was not in dispute at any stage of the case. Both the Defendants were Directors and shareholders of the Company.

5.	Acknowledgement of service of Writ of Summons filed by the Defendants on 6th November 2009.

6.	Statement of Defence filed by the Defendants on 18th December 2009 denying the claim of the Plaintiff on the basis, that subsequent to the Defendant's business being affected by the floods, it was taken over by Hussain Sakoor Samut, Mohammed Rafiq and Azad Sheikh together with all liabilities including the Deed of Guarantee dated 11th March 2008 and the new owners undertook to make all the payments and arrears and same was communicated to the Plaintiff who agreed, that the Defendants will be given time to sort out the payments and honestly believed that the new owners will comply with the payments to the Plaintiff.

7.	Having denied the allegations in the Statement of Claim, Defendants pleaded the Courts to dismiss the Statement of Claim.

8.	The summons for directions was filed by the Plaintiff on 7th April 2010 and Reply to Defence too filed on the same date.

9.	Summons to enter summary judgement filed by the Plaintiff on 12th May 2010 along with the Affidavit sworn by Karl Rebman Smith the General Manager of the Plaintiff.

10.	The summons to enter summary judgement was taken up by the Master on 14th of May 2010 and Master made order granting:

(a)	21 days for the Defendant to file the Affidavit in opposition;

(b)	14 days thereafter for the Plaintiff to file Affidavit in reply;

(c)	Hearing of the matter was fixed for 22/6/2010.

11.	On 6th of June 2010, ex-parte summons seeking leave to file third party notice on Hussain Sakoor Samut and Mohammed Rafiq and supporting affidavit dated 4th June 2010 was filed by the Defendants. By this time courts had already fixed the matter for hearing on summary judgement.

12.	Affidavit in reply to the said affidavit dated 4th June 2010, was filed by the Karl Rebman Smith the General Manager of the Plaintiff, on 21st of June 2010, on behalf of Dominion Finance Limited

13.	On 22nd of June 2010, the case was adjourned to 8th July 2010 and the matter was taken up on that day. On 8/7/2010, it was revealed that 3rd party summons were not served and Defendants were granted time to re-serve the summons on the 3rd party and application for summary judgement was fixed for 23/7/2010.

14.	Affidavits on service of summons to the 3rd parties were filed on 20th July 2010 stating the summons was served on Mohammed Rafiq on 20th July 2010 and on Hussain Sakoor Samut on 19th July 2010.

15.	Matter was taken up for hearing on 23rd of July 2010 before the Master. Counsel appeared for the 3rd party had stated he is not participating at the hearing of Summary Judgement and he seeked 14 days time to file Affidavit in opposition which was granted by the Master and the Counsel for the 3rd party didn't participate in the proceedings, at any stage of the case thereafter.

16.	Counsel for the Plaintiff and Defendants made submissions before the Master and the Master fixed matter for ruling on 20th August 2010 since parties stated, that they are relying on the affidavits filed and not intending to file the written submissions.

17.	Master delivered his ruling on 20th August 2010:

(a)	Entering summary judgement against the Defendants in a sum of $87,563.23;

(b)	The interest rate claimed at the rate of 18.5% per annum commencing from 7th July 2009 being reduced to 8.5% per annum to the date of the judgement and thereafter 4% per annum until full settlement of the outstanding;

(c)	Summarily assessed costs of $850.00.

18.	Order was issued by the Registry on 2nd September 2010.

19.	Leave to appeal applications were filed by both parties. For easy reference, I refer the Plaintiff and Defendants by their names in this Judgement, where it is appropriate.

20.	Leave to Appeal Application by Dominion Finance Limited (Plaintiff)

(a)	Dominion Finance filed its notice of motion for Leave to Appeal Application, the Affidavit by Sakiusa Biumaiwai (Team Leader Lending) on 3rd September 2010 sought leave to appeal with regard to interest rate ordered by Master's ruling dated 20th August 2010 i.e.:

(i)	 "in both its summary judgement application and its statement of claim, the Plaintiff sought interest of 18.5% on the Judgement sum since this was the rate of interest in the Contract which the Plaintiff and the Defendant's had entered......"

(b)	Leave to Appeal Application filed by Siddiq Faizal Koya and Mubarka Koya, Defendants

Notice of motion for leave to appeal was filed by the Defendants, Siddiq Faizal Koya and Mubarka Koya on 2nd September 2010 together with the Affidavit in support by Siddiq Faizal Koya one of the Defendants claiming that "the Master erred in fact and law in not giving proper weight to the fact that the interested third parties had not filed any response to the Appellant Defendants' third party proceedings before him".

21.	Both the above leave to appeal applications were heard by Hon. Justice Y. I Fernando and Order was delivered on 7th February 2011stating that:

"Leave to Appeal is granted to both the Defendants and Plaintiff to appeal against the Master's ruling on 20/8/2011"

22.	Hearing of the Appeals of both parties were taken up by Hon. Justice Fernando and hearing was concluded on 2nd May 2011 and Appeals were fixed for Order.

23.	When the case was mentioned on 7th November 2011 Hon. Justice Fernando informed the Counsel that on 6th November 2011 he came to know 1st named Defendant is a judicial officer who shook hands with him at a public place and as such he decided to withdraw from writing the Judgement and the case was fixed for 8th November 2011. 

24.	On 8th November 2011 with the consent of the Parties, Deputy Registrar was directed to Transfer both appeals to High Court of Suva for De Nova proceedings of the hearing of Appeal which was referred to me on 22nd November, 2011 for further proceedings.

25.	The case was mentioned before me on 29th November 2011 to fix a date of hearing. Accordingly, hearing was fixed for 7th February 2012.

26.	When the matter came up for hearing both appeals were heard together (HBC 193 of 2009 and HBA 07 of 2010).

27.	Counsel stated that written submissions were filed in the High Court of Lautoka and both Counsel made oral submissions before me. 

Submissions on behalf of Siddiq Faizal Koya and Mubarka Koya

28.	The Learned Counsel Ms Draunidalo made submissions on the basis that there is a triable issue in this case and quoted Greer L. J. in the case of Powszechny Bank Zwiakowyw Polsce vs Paros (1932) at p. 359.

29.	The Counsel further submitted Master had granted leave to add a third party to the case since there is a triable issue; and Master could not have entered summary judgement.

30.	Quoting para 10 of the Master's order it is stated by the Counsel on the basis of the letter dated 3rd February 2009 by the Defendants to the Plaintiff, Master should not have proceeded to enter summary judgement.

31.	The Counsel also drew attention of Court to Naidu vs Carpenters Fiji Ltd (1992) FCJA 38 (1992) 38 FLR 215 and referred to last paragraph of page 4 of the Defendant's written submissions and submit there is a substantial issue as to liability which ought to be triable by this Court, on the basis that there is no reply by way of an affidavit by Dominion Finance Limited.

32.	It is also submitted by the Counsel to draw attention of Court to the following matters:

(a)	Affidavit filed by Mr Koya on 2nd September 2010;

(b)	Written submissions dated 31st March 2010 under the heading, "Non Disclosure".

33.	In reply to query by Courts at the time franchise was discussed whether the loan was in default, Counsel stated the issue will be answered in the supplementary written submissions.

34.	It was submitted that oral submissions made by the Learned Counsel was based on 3 issues:

(a)	When leave was granted by the Master to Notice Third Party, Master cannot make an order for summary judgement;

(b)	There is a non-disclosure by Dominion Finance with regard to franchise of business;

(c)	There is unjust enrichment which will be dealt in supplementary submission.

Submissions by Dominion Finance Limited

35.	Mr P Sharma, Counsel made oral submissions on behalf of Dominion Finance Ltd.

36.	Counsel submitted he is relying on the affidavit filed by Mr Karl Smith, sworn on 20th September 2010 and filed on 21st September 2010. Also on the written submissions dated 28th March 2010 further submissions filed on 13th May 2011.

37.	The learned counsel submitted the following:

(a)	The Defendants have not disputed the debt nor the amount;

(b)	Summary judgement was entered after considering the affidavit in reply dated 4th June 2010 filed by Mubarka Koya on behalf of both the Defendants;

(c)	There is no sealed order with regard to leave for a 3rd party proceedings;

(d)	Referring to document KRS 2, Counsel stated that the communications were forwarded before Master made his decision;

(e)	Default of the loan commenced in December 2008 and Franchise discussions held in May 2009;

(f)	No correspondence with regard to assignment of the debt between the parties and no such documents were annexed to Defendant's affidavit and quoted the case of Tolhursd vs Associated Portland Cement Manufacturers (1900) Ltd (1902) 2 KB 660 at 668.

38.	Para 29 and 30 of the Master's Ruling and Affidavit of Defendants dated 4th of June 2010 were referred by the Counsel. As stated in the letter of M/S Iqbal Khan dated 7/12/2009 annexed to the Affidavit of the Defendant's, the Defendants agreed to pay the debt. There was nothing mentioned about 3rd party involvement.

39.	Referring to written submissions filed in opposition, Counsel stated:

(a)	Debt is not disputed;

(b)	Debt is never assigned to a 3rd party;

(c)	No documentation executed for assignment;

(d)	Dominion Finance has not given consent for any assignment.

40.	The Letter of Offer dated 4th March 2008 was issued by Dominion Finance, the loan agreement was signed by Mr S. F. Koya and Mrs Mubarka Koya along with the Deed of Guarantee. Third party was never involved with the transaction.

41.	In reply to non disclosure of third party involvement Counsel submitted that such disclosure will make no difference to the case and no bearing over the case.

42.	Counsel submitted even the email's referred are not relevant to the issue of admitting the assignment of the liability of Mr S. F. Koya and Mrs Mubarka Koya to a 3rd Party. 

43.	Annexures MK1 & MK2 annexed to the Affidavit dated 4th June 2010 opposing to the ruling proves commitment for payment by the Defendant.

44.	Plaintiff's Counsel submitted that in terms of Order 14 Rule 1 of the High Court Rules there is no triable issue. Master has considered Order 18 Rule 18 (1) (c) and (d) of High Court Rules and submitted the Defendants could have taken separate action against the 3rd party, and Dominion Finance cannot be a party to such action.

Submissions on Appeal filed by the Dominion Finance Ltd Reducing Rate of Interest from 18.5% to 8.5%

45.	Learned Counsel also make submissions with regard to the appeal filed by them against the Master's Order reducing the rate of interest from 18.5% to 8.5% and stated:

(a)	Defendant's not disputed the rate of interest in their statement of claim or at any stage of the case with regard to outstanding and rate of interest;

(b)	Plaintiff Appellant Dominion Finance Ltd should be able to recover the interest which was agreed by the Defendants Respondents.

(c)	Master has no discretion to reduce the rate of interest in absence of application by the Defendant Respondents;

(d)	If the rate of interest is reduced it will affect the Company's business.

46.	In the aforesaid circumstance, Master has erred in law by reducing the rate of interest from 18.5% to 8.5%.

47.	Counsel also quoted the Decree on Law Reform (Miscellaneous) Provisions dated 28/10/2011 and Judgement delivered in Case No. HBC 173 of 2003 page 20 onwards.

48.	Mr Sharma finally concluded his submissions stating Dominion Finance Ltd is entitled to the interest at the rate of 18.5%.

Submissions in Reply

49.	Ms Draunidalo, Counsel for Defendants Respondents submitted that the Dominion Finance Ltd had knowledge of the arrangement with 3rd party. As detailed in the emails, the investor called for the details of the loan.

50.	Dominion Finance Ltd has neglected in its responsibility and merits of the case would have been considered by the Master.

51.	The Learned Master would have fixed the case for early trial date and submitted that the supplementary submissions shall deal on the issues.

52.	Counsel opted to file supplementary submissions on the issues and the Court ordered to file supplementary submissions by Mr S.F. Koya and Mrs Mubarka Koya on or before 27th February 2012 and if there is any reply by the Dominion Finance Ltd on or before 7th March 2012 and judgement was fixed for 30th March 2012.

53.	As directed by Courts, Defendants have failed to file supplementary submissions on the due date and Court has already fixed the case for Judgement. R Patel Lawyers were to file the submissions in reply to the supplementary submission and by their letter dated 2nd March 2012, had informed the Registry it is not necessary for them to file submissions in reply since Defendants have failed to file submissions before 27/2/2012. I rely on the submissions already filed in the High Court of Lautoka to arrive at a conclusion in this case and conclude the Defendant Respondents are unable to file further submissions on the issues raised.

Findings and Conclusions

54.	The main issues to be addressed by this Court are:

(a)	As to whether the Summary Judgement entered by Master could be set aside on the appeal made by Mr S.F. Koya and Mrs Mubarka Koya?

(b)	As to whether the reduction of interest rate from 18.5% to 8.5% could be set aside on the Appeal made by Dominion Finance Ltd?

55.	All other issues raised by the parties are ancillary issues. Firstly, I deal with the issue (a) as to whether the summary judgement entered by the Master is justifiable. It is my task to analyse the statement of claim, statement of defence, affidavits filed documents annexed, written submissions filed and oral submissions particularly the Ruling made by the Learned Master; entering summary judgement.

56.	I observe the main issue to be addressed in this case is to whether the liability of Mr and Mrs Koya shifted to a third party which was the only defence taken up by the Defendants; grounds of appeal mainly restricted to this issue repeatedly.

57.	In the statement of claim, Defendants admitted:

(a)	A loan of $80,000.00 was approved to the Principal debtor and Defendants executed the documents as guarantors and on behalf of the Principal Debtor, Euro Parts (Fiji) Ltd;

(b)	Interest rate is admitted by the Defendants;

(c)	The loan repayments were in default;

(d)	Defendants admitted principal debtor's obligation under the loan (including the obligation to make repayments) were jointly and severally guaranteed by the Defendants pursuant to Deed of Guarantee dated 11th March 2008.

58.	Defendants stated in their statement of defence:

(a)	Due to floods in Nadi, Defendant's business premises were completely damaged and there was no business for several months due to which Defendants were unable to pay the debt. This situation was notified to the Plaintiff and had agreed that they will not proceed with any action until the Defendants were able to arrange for funds to pay the Plaintiff;

(b)	Defendants stated that after their business was affected by the floods the business was taken over by Hussein Sakoor Samut Mohammed Rafiq and Azad Sheik together with Deed of Guarantee dated 11th March 2008 and new owners undertook to pay all the payments and this was communicated to the Plaintiff who agreed that the Defendants will be given time to sort out the mode of payments. The Defendants believed that the new owners will comply with the payments.

59.	I now analyse the above two issues which are vital to decide on the issue of summary judgement. I wish to refer the Masters Ruling and his conclusions on this issue.

60.	Master in his Ruling had extensively analysed the evidence before him. On page 5 he refers to the affidavit of Karl Rebman's Letter of Offer (Annexure 'A'), Loan Assessment and Approval (Annexure 'B'), Deed of Guarantee signed by the Defendants (Annexure 'C'), Deed of Debenture (Annexure 'D'), Bill of Sale (Annexure 'E') and the Defendant's letter dated 3rd February 2009 (Annexure 'F'), and other documents marked G to I.

61.	Annexures A to E are not in dispute. However, it is important to analyse the paragraph 3 of the Statement of Defence. The Defendants have not divulge the contents of this letter in correct form and they have misrepresented the contents of the letter to establish a false defence to Courts.

62.	It is stated in the para 3 ".......................the Plaintiff was notified of this fact and who had agreed that they will not proceed with any action until the Defendants were able to arrange for funds to pay the Plaintiff".

63.	The said statement is misleading. What the first named Defendant requested from the plaintiff by letter dated 3rd February 2009 is (Annexure 'F'):

Para 4 of the letter:

"As suggested in our earlier meeting we urgently request that you freeze our payments and interest on our loan account for three (03) months and allow us to relocate and restart the business again".

64.	There is no agreement by the Plaintiff to accede to this request. The Defendants had distorted the facts and avert in paragraph 3 of the Statement of Defence that Plaintiff has agreed not to proceed with any action until Defendants were able to find funds to pay the Plaintiff. This position is denied by the Plaintiff in its affidavit. No Financial Institution will be able to accommodate or agree to such a suggestion. Financiers do not lend their own monies. Monies lent are collected from the depositors and share holders and the company has to pay interest or dividends on such funds. Particularly, monies lent have to be collected effectively otherwise operation of a Finance business is at a stake. Whilst accommodating the requests from debtors in their difficult periods Finance Company cannot accommodate such requests for indefinite period of time. The Master has extensively dealt on this issue by analysing the affidavit of Mr Karl Rebman filed on behalf of the Plaintiff and Mrs Mubarka Koya's affidavit filed on behalf of the Defendants.

65.	To add further, although there is no written confirmation, the Plaintiff by their conduct given more than 3 months for the Defendants to arrange funds for repayment until the demand served by R Patel Lawyers on 16th July 2009 (Annexure 'H' to Mr Karl Rebman's affidavit).

66.	In light of the above, I hold the Defendant's manipulated and misrepresented the facts to Courts to establish a defence but it is nullified by their own letter marked as Annexure 'F' referred to in paragraph 61 and 64 of this Judgement.

67.	I concede that the Master had correctly analysed the facts and stated Plaintiff has deferred the payment for the months of December 2008 and January and February 2009. Even after February 2009 Defendant Respondents had defaulted the payments.

68.	The main ground for appeal is that the debt was assigned to a third party and Defendants verily believed that 3rd party will make the payments to the Plaintiff Appellant, Dominion Finance Limited.

69.	Defendants had failed to establish any evidence with regard to the assignment of the debt to a third party. The emails referred to in this case does not suffice to evident the assignment of a debt.

70.	The Judgements quoted by the Master in his ruling with regard to assignment of the Debt and confer liability to a third party are relevant and the Learned Master had concluded there is no proper assignment of debt which I agree.

71.	I concede that:

(a)	No evidence to a substantiate agreement being entered by the Principal Debtor with a 3rd Party to assign the Debt;

(b)	The Creditor should be a party to such an Agreement. Without consent from the Creditor, assignment of a debt or assignment of a deed of guarantee cannot be effected, with the exception if the original agreements entered between the parties provide for such assignment without consent;

(c)	No reasonable person can come to a conclusion a Finance Company will come to an arrangement to assign a debt to a 3rd party without a new Deed of Guarantee being executed, and proper securities being obtained;

(d)	Assuming if there was an agreement with the third party by the Defendant Appellants for taking over the liability of Defendant Appellants to the Dominion Finance Ltd in violation of such agreement Defendant Appellants would have taken separate action against the 3rd Party. However, such action being not initiated by Defendant Appellants and it clearly shows, the purpose of bringing 3rd Party issue to this case is to delay the proceedings of this case which result delay in recovering its dues by Dominion Finance Ltd;

(e)	I am also of the view that even after filing this case by the Plaintiff Respondent (Dominion Finance Limited) if there were discussions and agreements with the 3rd Party which would have continued and meaningful steps would have taken to repay the outstanding dues to Dominion Finance Limited. 

72.	It is my view assuming the debt is assigned to a 3rd Party, No Finance Company will agree to release the Guarantors from the liability unless Deed of Guarantee is being executed by acceptable 3rd Party.

73.	In absence iota of evidence by way of written documents to establish assignment of debt, I concede that there is no triable issue raised by the Defendants affidavit in opposition or even by the Statement of Defence. As the Master had stated there is no defence to the claim. Courts also not shied away from granting Summary Judgement where the defence is not either bona fide defence or discloses no triable issue and merely have effect of delaying Judgement in favour of the Plaintiff (Carpenters Fiji Limited vs Joes Farm Produce Limited Civil Appeal No. ABU 0019/2006).

74.	Having concluded I hold that there is no triable issue in this matter and defendants had failed to satisfy Court that there is some issue or question or dispute which ought to be tried.

75.	I am also of the view that the Statement of Defence filed by the Defendants is merely to delay the proceedings for recovery of the dues of the Plaintiff. Without evidence to establish a third party took over the liability how the Defendant Appellants could get away with the liability which is conferred by a Deed of Guarantee?

76.	I also wish to draw attention to the Deed of Guarantee dated 11th of March 2008 marked as Annexure 'C' to the affidavit dated 10th May 2010 of Plaintiff's General Manager Karl Rebman. It is evident as stated in paragraph 6 and 7 of the Deed of Guarantee any arrangement by the Principal Debtor does not discharge the guarantors from the liability.

77.	In the circumstances the alleged 3rd party involvement cannot be considered as a triable issue and I state that this issue was raised by the Defendants to delay the Judgement to default the payments due to the Plaintiff.

78.	There is no relevance of the principles cited by the Defendants counsel in the case of Powszochny Bank Zwia Kowy vs Paras (1932) 2 KB 353 at page 353 since there is no triable issue in this case.

79.	I also quote the case cited by Defendants counsel following passage from the Judgement of Parker L.T. in Home and Overseas Insurance Co. Ltd vs. Meular Insurance Co. U.K. Ltd (in Liq) (1989) 3 All A.E.R. 74 at 77 with regard to Ord. 14:

"The purpose of Ord. 14 is to enable a plaintiff to obtain a quick Judgement to the Claim. If the Defendant's only suggested defence is a point of law and the Court can see at once that the point is misconceived the plaintiff is entitle to judgement. If at first sign the point appears to be arguable but with relatively short argument can be shown to be plainly unsustainable the plaintiff is also entitled to Judgement" (emphasis is mine).

In the present case the argument of 3rd party assignment unsustainable and the Defendant's citation is in favour of the Plaintiff.

80.	Defendant's counsel also had referred to Fiji Court of Appeal in the case of Magan Lal Brothers Limited vs L B Narayan and Company Civil Appeal No. 31 of 1984 where Court of Appeal has referred to the Halsbury's Law of England (4th Ed) Volume 37 paras 413-415 which refers to Rule 3 and 4 of Order 14. The Learned Master also has referred to this case in his ruling:

"413 whereas Plaintiffs application for summary judgement under Order 14 is presented in proper form and order, the burden shifts to the defendant and it is for him to satisfy the court that there is some issue or question in dispute which ought to be tried or that there ought for some other reason to be a trial unless Defendant does so, the Court may give such judgement for the plaintiff against the defendant as may be just........................"

I concede that in this case Defendants had failed to establish any issue or question in dispute which ought to be tried or that there ought for some other reason to be tried.

81.	The position taken up by the Defendant that the third party failing to file an affidavit cannot be taken into account in this matter applying the case of Magan Lal Brothers vs L B Masters supra since the Defendants have failed to satisfy courts with substantial evidence by way of documents with regard to third party liability. As stated by the Learned Master in his ruling "if the ........................courts must then direct its mind to the issues raised in the defence to see whether it has merits and is not just a sham defence to delay judgement or avoid the necessity of showing cause by affidavit". In the present case I hold that issue raise by defendants is without any substance and merely to delay the judgement.

82.	Defendant's counsel had stated in her submissions that non disclosure of third party is not considered by the Master and time was granted to file further submissions on this issue and no further submissions were tendered. In the circumstances which I stated in the preceding paragraphs, I hold Defendants failed to establish the non disclosure is fatal to the summary judgement.

83.	The Learned Master has referred to the case of Collins MR's statement in Talhurst vs Associated Portland Cement Manufacturers (1900) Ltd (1902) 2KB 660 and 668 stated:

It is I think quite clear that neither at Law nor in Equity could be burden of contract be shifted off the shoulders of contractor on to those of another without the consent of the contractor. A debtor cannot relieve himself of his liability to his creditor by assigning the burden of the obligation to somebody else. This can only be brought about by the consent of all three and involves the release of the Original Debtor". (emphasis is mine)

There is no reason to believe that the Plaintiff will agree for 3rd Party to be assigned in a default loan without a formal agreement being entered between the parties.

84.	It is also my view that failing to produce any documentation in evidence by the Defendants to prove such assignment, Defendant's having failed to establish any defence, on the merits or any triable issue and the appeal for set a siding the summary judgement fails.

85.	In making oral submissions, Counsel for the Defendant Appellant raised three issues:

(a)	The Learned Master cannot enter summary judgement when leave was granted to notice the Third Party. I am declined to accept this position since the Master arrived at a decision by examining all materials before him and concluded there is no triable issue in this case. Merely, noticing of 3rd Party will not prevent the Master from entering the summary judgement.

(b)	There is a non disclosure by Dominion Finance with regard to franchise of business. I have already dealt with this matter under paragraph 83 of this Judgement and hold there is no material non disclosure by the Plaintiff and no evidence by way of documents to establish the non disclosure is fatal to entering summary judgement. Although leave granted to file further submissions, Defendant Appellants failed to tender such submissions to Court;

(c)	Defendant Appellants counsel also submitted that further submissions will be tendered to Courts on the issue of unjust enrichment and other unaddressed issues. Accordingly, I granted time till 27th of February 2012 to file further submissions and the Defendant Appellants counsel did not addressed this issue at all and failed to file submissions. Accordingly, I hold there is no unjust enrichment by the Plaintiff Respondent with the material available, even if there is unjust enrichment it is the Defendant Respondents who unjustly enriched by obtaining a loan from Dominion Finance Ltd and defaulting the repayment.

86.	Summarising the submissions made by the Counsels for the Plaintiff stated:

(a)	Debt is not disputed;

(b)	Debt is never assigned to a 3rd Party;

(c)	No document executed for assignment;

(d)	Dominion Finance Limited had not given consent for any assignment;

I have already dealt with the above issues in the herein before and conclusions were made in favour of the Plaintiff Respondent; Dominion Finance Limited.

87.	In the circumstances, I hold that Defendant Appellants (Mr Faizal Siddiq Koya and Mrs Mubarka Koya) had failed to establish the grounds for appeal to set aside dismiss or discharge the summary judgement delivered by the Learned Master, Mr A Tuilevuka on 20th August 2010 and sealed on 2nd September 2010.

Appeal by Dominion Finance Ltd with regard to Reduction of rate of interest 

88.	Plaintiff Appellant appealed against the Ruling of the Master to reduce the rate of interest from 18.5% to 8.5% on the basis that:

(a)	In both summary judgement application and statement of claim by Dominion Finance Ltd sought interest at 18.5% on the judgement sum since this was the rate of interest in the contract which the parties had entered;

(b)	The interest Dominion Finance Ltd claimed was not a discretionary issue. There was no cross claim by the Judgement Debtor that the interest rate was under challenge or not applicable. The Master erred in adopting the position that he had discretion to fix a lower rate of interest than that agreed to by the Parties in the contract that they entered into.

89.	Having granted leave to appeal by the Order of Hon. Justice Mr Y I Fernando on 9th March 2011, both Plaintiff Appellant and Defendant Respondents filed their submissions.

Plaintiff Appellants Submissions

90.	Dominion Finance Ltd had filed their submissions in support of its appeal on 30th March 2011:

(a)	In terms of the Contract, Respondents borrow funds and agreed to pay interest at the rate of 18.5% and Plaintiff Appellant was entitled to be awarded that rate of interest by the Learned Master;

(b)	The rate of interest 18.5% claimed by the Plaintiff Appellant was not a discretionary issue. Master erred in adopting the position he had discretion to fix lower rates of interest than the agreed rate.

91.	Dominion Finance Limited submitted Section 3(b) of the Law Reform Miscellaneous Provisions (Death and Interest) Act Cap 27 states:

"in any proceedings tried in the Supreme Court for recovery of and debt or damages the court may, if it thinks fit order that there shall be included in the sum for judgement is given interest at such rate as it thinks fit on the whole or any part of the period between the date when the cause of action arose and date of the Judgement.

Provided that nothing in this section...........(b) shall apply in any debt upon which the interest rate is payable as right, whether by virtue of any agreement or otherwise........."

92.	It was submitted in light of the above sections of the said Act that Mr F. S. Koya and Mrs Mubarka Koya, Defendant Respondents agreed for the interest rate of 13.5% default rate of interest at 18.5%. In the circumstances the Master had no jurisdiction to impose the interest of 8.5% from 7th July 2009 to the date of Judgement and the interest rate at 4% until full settlement of judgement sum.

93.	It was also submitted despite there being no challenge to the interest rate at 18.5% by the Defendant Respondents; the Master substituted the pre judgement interest rate of 8.5% and a post judgement rate of 4%.

94.	It was also submitted the Master's award on interest could set precedence for Appellants. Others borrow willing to pay a lower rate of interest.

95.	In the oral submissions Counsel for Plaintiff Appellant drew attention of the Court to Decree on Law Reform Miscellaneous Provisions (Death and Interest) Amendment Decree 2011 (Decree No. 46 of 2011) and the Judgement by Hon. Justice Calanchini in Case No. HBC 173 of 2003 page 20 onwards.

Submissions made on behalf of Defendant Respondents, Mr F S Koya and Mrs Mubarka Koya

96.	In the written submissions filed by Defendant Respondents on 31st March 2011, it is stated under the heading:

"Interest: The Appellants (Mr S F Koya and Mrs Koya) submit that the error of fact and law by the Master plus the non disclosure by the Respondents (Dominion Finance Ltd) before the Master should be fatal to any interest component".

97.	The Counsel for the Defendant Respondents in her oral submissions stated that with regard to this issue further submissions will be filed, and failed to file further submissions as I stated herein before.

Findings and Conclusions

98.	The Learned Master in his ruling under the heading Orders stated page 10:

"However, I refuse to grant the pleaded interest rate of 18.5% per annum to accrue from 7th July 2009 until full payment. In my view this would be exorbitant.

Instead I fix interest at the rate of 8.5% from 7th July 2009 to the date of this Judgement plus post judgement interest at 4% until full settlement of judgement sum".

99.	The issue to be addressed is whether the Master had the discretion to reduce the rate of interest.

100.	In this regard Counsel for the Dominion Finance Limited cited the Judgement of Hon. Justice Calanchini in Case No. HBC 173 of 2003; Moti Chandra Company Limited vs Credit Corporation (Fiji) Ltd and Eparama Turaga, page 20 onwards.

Hon Justice Mr Calanchini stated in paragraph 3 of the page 20:

"On the material before the Court and for the reasons already stated, I find in favour of the First Defendant in respect of its Counter Claim. The amount claimed in the Writ for the amount as at 30th September 2003 being $135,687.61. From that date of Judgement, contractual interest claimed at 25%. This is the effect of clause 12 and the schedule on the First Page of the Agreement. The amount owing under the agreement as at end of October 2011 was $1,088,503.91. Furthermore, I find that the First Defendant is entitled to that contractual interest up to the date of judgement......................"

101.	The same situation arisen in this case too. The Letter of Offer dated 4th March 2008 was accepted by the Principal Debtor (signed by Mr S F Koya and Mrs Mubarka Koya as Directors) form part and parcel of Deed of Guarantee dated 11th March 2011. The schedule to said Letter of Offer clearly indicates interest rate of 13.5% per annum and in case of a default at the rate of 18.5% per annum. In the circumstances, I hold that having entered into a contract; the Plaintiff Appellant is entitled to judgement sum of 87,563.23 as at 6th July 2009 together with interest at the rate of 18.5% up to the date of entering summary judgement. The Master had no discretion to reduce the interest rate from 18.5% to 8.5% since the rate of interest is already contracted, by the Parties.

102.	However, in the said case of Moti Chandra Company Limited, agreement entered between the parties contained a clause:

"to pay interest at the default rate specified in the schedule to this instrument on any monies payable under the agreement and under any judgement obtained by (the First Defendant) against (the Plaintiff) in respect of moneys payable under the agreement, which may from time to time be overdue

103.	The contract between the parties did not carry a clause to this effect and I hold in absence of such a clause the Law Reform (Miscellaneous Provisions) (Death and Interest) (Amendment) Decree 2011 (Decree No. 46 of 2011) applies. It is stated:

"Every Judgement Debt shall carry interest at the rate of Four cents per centum per annum from time of entering the judgement until the same shall be satisfied and such interest may be levied under a Writ of Execution on such Judgement".

104.	 Accordingly, I hold Master's decision to charge interest at the rate of 4% per annum as post judgement rate of interest is justified.

105.	In the aforesaid circumstances, I hold the Learned Master did not had the discretion to reduce the rate of interest from 18.5% to 8.5% up to the date of judgement and the interest applicable should be contracted interest rate at 18.5% up to the date of Judgement. I further hold Post Judgement rate of interest should be at the rate of 4% per annum as decided by the Master and under the Provisions of Decree No. 46 of 2011.

106.	Having considered both appeals, the Orders of the court are:

(a)	The appeal by the Defendant Appellants (Mr F S Koya and Mrs Mubarka Koya) against the summary judgement dated 20th August 2010 is dismissed;

(b)	The Defendant Appellants (Mr F S Koya and Mrs Mubarka Koya) are ordered to pay summarily assessed costs of $4,000.00 to the Plaintiff Respondent (Dominion Finance Ltd);

(c)	The appeal by the Plaintiff Applicant (Dominion Finance Limited) against the interest rate being reduced from 18.5% to 8.5% and post judgement rate of interest at the rate of 4% by the Master is substituted by the following Order:

"The rate of interest 18.5% per annum is fixed from 7th July 2009 to the date of judgement plus post judgement interest at 4% until full settlement of the Judgement sum".

(d)	Except for the Order to change the rate of interest as detailed in para (c) the Summary Judgement entered by the Learned Master remain unchanged;

(e)	No order for costs is made with regard to appeal filed by the Plaintiff Appellant (Dominion Finance Ltd).

Delivered on 9th March, 2012

C. KOTIGALAGE
JUDGE