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Bugotu Nickel Ltd v GTS Ltd [1994] SBCA 15; CA-CAC 5 of 1994 (4 November 1994)

IN THE SOLOMON ISLANDS COURT OF APPEAL

Civil Appeal No. 5 of 1994

BETWEEN:

BUGOTU NICKEL LIMITED
(Appellant) Defendant

AND:

G.T.S. LIMITED
(Respondent) Plaintiff

Before:
Connolly P.
Williams J.A.
Los J.A.

Delivered the 4th day of November 1994

JUDGMENT OF THE COURT

G.T.S. Limited (trading as Guadalcanal Travel Services) had, by 23 July 1993, provided airfares and other services to China Forest Products Ltd. (formerly Axiom Forest Products Ltd.) of a value of approximately $78, 000. On that date the appellant wrote accepting liability for the amount and engaging to pay it when funds were available, which was expected to be in about 4 months. The true sum was SBD77, 565.33. Action was brought by the respondent against the appellant on 18 October 1992 and was set down for trial on 19 May 1994.

On 18 May 1994 Mr. Stratos Kirmos of Axiom (Brisbane) would seem to have faxed Mr. Radclyffe, who was the respondent’ s solicitor, seeking an adjournment on some terms which were not in evidence. Mr. Radclyffe replied that day by a without prejudice fax to the Kirmos’ fax 617 891 5787 offering to accept:

SBD 10,000 within 7 days of 18 May

SBD 10,000 within 30 days thereafter

SBD 57,565.33 within 30 days thereafter

He also claimed interest at 15% on the reducing balance and Court fees of SBD2, 500. He engaged to adjourn the case but warned that on default of payment he would relist the case and proceed to judgment. Mr. Kirmos replied on the same day to Mr. Radclyffe by fax from 617 891 5787 accepting “terms of settlement”, an expression Mr. Radclyffe had also used. It will be noted however that the three installments required by Mr. Radclyffe are in total the exact amount of the account for which the appellant had accepted liability. The interest claimed is not suggested as being other than the type of interest ordinarily allowed on liquidated sums by the Court and the Court fees are obviously an ordinary incident of litigation.

In other words, all that happened on 18 May 1994 was that the respondent gave time for payment. It is not a case of a settlement of a plaintiff’s claim substituting a different obligation for that sued upon. The appellant was given a maximum of 67 days for payment in full together with interest and costs which would naturally form part of a judgment.

The first two installments were duly paid by the appellant, amounting to further admissions of liability. However the installment of SBD57, 565.33 was not. Mr. Radclyffe relisted the matter and Muria C.J. gave judgment for the final installment, interest and costs.

Bugotu Nickel’s defence to the action had alleged that, in effect, the four month period referred to in the letter of 23 July 1993 was a condition of liability, so that the action was prematurely commenced in October 1993. However, it cannot be so understood. Liability was unconditionally accepted and the reference to the four months was a statement of expectation only.

This appeal was brought against that judgment. Mr. Kama, for the appellant contended that the fax sent by Mr. Radclyffe on 18 May 1994 was without prejudice and that this made it inadmissible. It has however been accepted and indeed, partly performed. He also suggested that the letter of 23 July 1993 accepting liability was on Axiom Corporation Development Ltd letterhead but in fact it was on that of the appellant. Finally he suggested that there was no evidence that Mr. Kirmos negotiated for the appellant. He had however plainly negotiated an adjournment on behalf of the appellant and accepted the terms offered by Mr. Radclyffe as the price of an adjournment. He asked for particulars of Mr. Radclyffe’s account so that arrangements could be made to transfer the funds and the first two installments were in fact transmitted.

Finally it was contended that the acceptance of liability was unenforceable for want of proof of consideration. However the events of 18 May 1994 and the two payments involve clear admissions of enforceable liability. In this connexion it is not immaterial that Mr. Kama informed us that these companies form part of a group.

There is no merit in this appeal which must be dismissed with costs.

THE COURT
(P. D. Connolly P.)