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Lodhias Travel Services Ltd v Samut [2015] FJHC 315; HBC89.2000 (28 April 2015)

IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION

Civil Action No. HBC 89 of 2000

BETWEEN:

LODHIAS TRAVEL SERVICES LIMITED
Plaintiff
AND:

ZAINUL IMTIAZ BEGUM SAMUT
First Defendant
AND:

MOHAMMED RAFIQUE
Second Defendant
AND:

HUSSEIN SAKOOR SAMUT
Third Defendant

Appearance : Mr S Sharma of R Patel Lawyers for the Plaintiff

Mr O'Driscoll instructed by Iqbal Khan Associates for the 3rd Defendant

Date of Judgment: 28 April 2015

JUDGMENT

[1] The Notice of Motion was filed by the 3rd Defendant and sought the following Orders:

"(a) That the Judgment entered against the Third Defendant on the 13th day of April 2012 be set aside;

(b) That execution of the said order be stayed pending determination of this application".\

The above application was made pursuant to Order 35 of the High Court Rules and the inherent jurisdiction of this court. At the outset, I note that the 3rd Defendant's solicitor failed to state the particular rule in the Notice of Motion and the correct rule should be Rule 2. It is reminded when the applications are made specific rule should be stated in the Notice of Motion.

[2] Facts

2.1 On 14 November 1997, the Plaintiff entered into an agreement with the First and Second Defendants. The Plaintiff to provide airline tickets and other services to the 1st Defendant on the credit facilities provided by the Plaintiff in terms of the Agreement. The Second Defendant guaranteed the payment of any invoices raised by the Plaintiff, charges and interest.

2.2 On 2 February 1998, by the letter dated 2nd February 1998 the 1st Defendant had acknowledged the debt of $57,145.40 owing to the Plaintiff. By the said letter, the 1st Defendant promised to repay the debt by monthly installments of $5,000.00 each. Having made certain payments of the said amount there was a sum of $50,939.15 which remained outstanding.

2.3 The 3drd Defendant by his letter dated 29th October 1998 agreed to pay the outstanding Debt of the 1st Defendant's debt to the Plaintiff. It is evident that the 3rd Defendant guaranteed and indemnified the debt of the 1st Defendant and taken the responsibility of the repayment.

[3] To make determination on the orders sought by the 3rd Defendant, I have considered the following:

(a) Affidavit in Support sworn by Hussein Sakoor Samut dated 5 September 2012;

(b) Affidavit in Response filed by the Plaintiff sworn by Vinod Hari Singh Mistry, Director of the Plaintiff dated 8 November 2012;

(c) Affidavit in Reply filed by the Defendant Hussein Sakoor Samut Sworn on 15 November 2012;

(d) Written and oral submissions made by the parties.

[4] The 3rd Defendant stated that:

4.1 The 3rd Defendant became aware of the orders of this court made on 13 April 2012 after the order was served on him. The Affidavit of Service was filed on 30 January 2013 the order was served on 9 August 2012.

4.2 Notice of Motion to set aside the judgment was filed on 6 September 2012 after 27 days of the date of serving the judgment.

[5] The chronology of the events is vital to make the determination of the application. This court has to analyze in what circumstances the 3rd Defendant failed to participate in the proceedings, which led finally to enter the judgment by way of formal proof. The 3rd Defendant had only addressed the matters arisen after the judgment. I find to decide on the issue the events taken place after the pre trial proceedings are relevant, in this case.

5.1 On 16 May 2011 the Master of this court directed to allocate this matter to a Judge for hearing on NOAH.

5.2 This matter was allocated to me and I made directions to mention this case before me on 25th day of January 2012 at 9.30am. The court registry had noticed the solicitors for both the parties that this matter has been set down for mention on 25 January 2012. The notice was sent to the Defendant's solicitor on 5 January 2012. When the matter was mentioned on 25 January 2012, the Defendant or his solicitor/counsel (Iqbal Khan and Associates) were not present in the court. Mr Sharma counsel for the Plaintiff stated Mr Khan is supposed to be out of the country and this court fixed the matter for mention on 24 February 2012 for the purpose of fixing a hearing date and directed the registry to inform the solicitors for the 3rd Defendant the next date.

5.3 The court registry had advised the 3rd Defendant the matter was mentioned on 25 January 2012 at 9.30am by Fax Transmission. The 3rd Defendant or his solicitor failed to appear on 25 January 2012. No Affidavit evidence was produced with regard to the absence on 25/1/2012, except for the reason that the 3rd Defendant did not receive the notice.

5.4 Thereafter the matter was fixed to be mentioned on 24 February 2012 and this court directed the Registry to inform the Defendant's solicitor. The court registry by its letter dated 15 February 2012 informed the solicitors Patel Sharma Lawyers for the Plaintiff and Iqbal Khan Associates for the 3rd Defendant the matter listed for mention on 24 February 2012 was to be fixed for 23rd February 2012.

5.5 On 23rd February 2012, when the matter was mentioned the Plaintiff's counsel appeared and the 3rd Defendant or his counsel/solicitor were not present. I note there was no cogent reason given by the 3rd Defendant for his absence, in his Affidavits, except merely stating the notice was not received which was not substantiated. On this day the Plaintiff's counsel made an application to file additional bundle of documents and this court directed to file the additional bundle of documents before 10 March 2012 and the matter was fixed for hearing on 13 April 2012 at 9.30am. The supplementary bundle of documents was filed by the Plaintiff was served and accepted by the 3rd Defendant's solicitor's agents O'Driscoll and Co. on 7 March 2012. It is evident that the 3rd Defendant's solicitors were well aware that there was ongoing proceedings before the court and the 3rd Defendant and his solicitors failed to act diligently to peruse the record and to check the status of the case at this stage. The 3rd Defendant's position that the registry should always advise the court dates carry's no merits. The duty of care to be exercised by the solicitors cannot be shifted to the court registry. I conclude the default of the appearance of the 3rd Defendant is not justified.

5.6 The hearing of the case was taken up on 13 April 2012. The 3rd Defendant or his solicitors were not present and the matter was taken up for trial for formal proof. The Plaintiff's claim was established through the evidence of Hari Singh Vinodh. I also considered the statement of the Defence before making my orders. The Defence was prima facie in wrong footing i.e. since the 3rd Defendant was not a party to the agreement he is not liable. As stated in the paragraph 2.3 of this judgment, the 3rd Defendant is liable for the payment.

5.7 For the reasons set out in the preceding paragraphs the 3rd Defendant's inaction on the matter commenced from 25 January 2012 and not after serving the sealed judgment on 9 August 2012. Considering all the material before me, I conclude that the 3rd Defendant and his solicitor's failure to act diligently to make inquiries as to the status quo of the matter after 25th January 2012 and 23 February 2012 resulted in entering judgment on 13 April 2012. After the Plaintiff's supplementary bundle of documents was served on 7th March 2012, the 3rd Defendant was aware that there was proceedings resumed in this case and the 3rd Defendant failed to take any steps to make inquiries or take any further action. As such, I conclude the 3rd Defendant's inaction and failure to participate in the proceedings is unjustified.

[6] Now I consider as to whether the 3rd Defendant's application under Order 35 Rule 2 of the High Court Rules carry any merits.

6.1 The 3rd Defendant is out of time for 145 days from the date of Judgment and the 3rd Defendant is responsible for the delay and as I concluded in preceding paragraphs of my judgment of the said delay is inexcusable.

6.2 The Order 35 Rule 2 states:

"(1) Any Judgment, Order or Verdict obtained where one party does not appear at the trial may be set aside by the court, on the application of that party, on such terms as it thinks just.

(2) An application under this rule must be made within 7 days after the trial".

There are two important aspects in this rule.

(a) In sub rule 1 the court is empowered to use its discretion. Firstly, the party who did not appear at the trial have to make an application. Secondly, the trial may be set aside by the court on such terms as it thinks just. In other words, the court may consider such application if the reason for non-appearance is with merits and justified;

(b) In sub rule 2, it is stated an application to set aside a judgment, order or verdict must be made within 7 days.

6.3 I also agree with the Plaintiff's submission that there is no application before me for extension of time to file the present application and the 3rd Defendant fails.

6.4 The 3rd Defendant's counsel stated in his submission that Order 35 Rule 2 is not mandatory. Further he submitted the annexure VHM1 annexed to the Affidavit of the Plaintiff dated 8 November 2012 was not served on the 3rd Defendant. This is a copy of the Notice of Adjournment faxed to the Plaintiff's counsel. However, on record the faxed transmission copy of the said Notice of Adjournment was sent to the solicitor for the 3rd Defendant and as I concluded in the paragraph 5.2 the argument of the 3rd Defendant fails. It was further submitted by the 3rd Defendant's counsel that the letter dated 15 February 2012 (annexure VHM3) was not served on the 3rd Defendant. However, the copy available in the record clearly shows the said letter was served on the 3rd Defendant as I concluded in paragraph 5.4 of this judgment. The submission made by the 3rd Defendant's counsel fails. The counsel further submitted that the order made by this court on 13th April 2012 was not served on the 3rd Defendant until 9th August 2013. However, this argument does not carry any merits since I have concluded the real issue of delay by the Defendant commenced in January 2012 as stated in the preceding paragraphs 5.5 and 5.7 of this judgment. It was also submitted that the application for setting aside under Order 35 Rule 2 to be filed within 7 days is not a mandatory provision. I agree with the submission that the court can use the discretion however in this case there is no exceptional circumstances to exercise the inherent jurisdiction of this court in favour of the 3rd Defendant for his delay. The defaulting parties are not entitled for a relief on procedural compliance when they make their application at their leisure like in this case. In such circumstances court cannot use its discretion in favour of the 3rd Defendant. The time periods are specified by the legislature not to use the discretion freely, but considering the circumstances of each case and on the justification of the default. The 3rd Defendant failed to justify his default I conclude. As I stated in the preceding paragraph 6.3, I reiterate the 3rd Defendant's failure to seek extension of time by filing an application for setting aside the order is determined in favour of the Plaintiff. The case authorities referred by the counsel for the 3rd Defendant are not relevant in this matter for the reasons:

(i) there is no breach of natural justice;

(ii) the 3rd Defendant did not justify the default.

[7] Accordingly, I make the following Orders:

1. The Notice of Motion filed on 6 September 2012 dismissed.

2. The 3rd Defendant is ordered to pay $1,500.00 to the Plaintiff summarily assessed.

Delivered at Suva this 28th Day of April 2015.

......................................
C. KOTIGALAGE
JUDGE