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Shem v Hou [2020] SBHC 127; HCSI-CC 412 of 2019 (26 April 2020)

HIGH COURT OF SOLOMON ISLANDS

IN THE HIGH COURT OF SOLOMON ISLANDS
CIVIL JURISDICTION

Civil Case Number 412 of 2012

BETWEEN

DAVID SHEM, JOHN BIKUSA, ROBERT KIKO, STEPHEN PAENI AND SOLOMON BIGNA
Claimant

AND:

ALICK HOU, NELSON THOA, ALREAD PITA AND OTHERS
Defendants

Date of Hearing: 11 December 2020
Date of Decision: 26 April 2020

L Puhimana for the Claimants
R Dive for Defendants

Lawry; PJ

RULING

Introduction

1. On 9 March 2020 the Court granted default judgment orders in favour of the Claimants. The orders were perfected in the judgment dated 11 March 2020. Those orders were served on the Defendants Alfred Pita and Nelson Thoa on 17 March 2020 and on the Defendant Alick Hou on 25 March 2020. The next step in the proceedings was an application for an enforcement order by the Claimants. That order was granted by the Registrar on 12 May 2020.
2. On 11 June 2020 the Defendants applied to set aside the default judgment perfected on 11 March 2020 and also applied to stay the enforcement orders perfected on 12 May 2020.
3. The Court heard submissions on behalf of both the Defendants and the Claimants on 11 December 2020. By consent, the Court made orders permitting the Claimant to file written submissions by 18 December 2020 with the Defendant having the right to respond to any of those submissions by 8 January 2021. The Sheriff was directed to take no further steps in relation to the enforcement orders until further order of the Court.
4. Counsel for the Claimants filed submissions but counsel for the Defendants has not filed any submissions in reply. The Court has delayed preparing its decision to accommodate the Defendants.

Background

5. The Claimants are trustees of registered land known as Dova Land being Lot 3 of LR 653 in parcel number 192-012-4 [“the land”]. On 14 May 2010 Justice Cameron confirmed that the Claimants were the registered owners of the land holding that land as trustees. He recorded that in the 1970s there were various local meetings held to determine who ought to be the proper trustees of the land. Objections at that time were not upheld and the Commissioner of lands settled on 5 trustees who in 1975 were registered on the title. Between 1999 and 2004 three of the original five trustees died. Three new trustees were appointed and Justice Cameron found that there was nothing to suggest that any of the procedures for appointing new trustees had not been fully complied with.
6. Possession of the land was granted to the Claimants. The Defendants in the proceedings together with their servants, agents, invitees, licensees and others occupying the land were required to immediately vacate the property and remove their personal belongings from the land.
7. The Defendants in the proceedings were before Justice Cameron were Joel Vakalea, Stephen Ray Thogo and Judah Sikua. This fact is recorded as the land in the proceedings before Justice Cameron is the same land and in the current proceedings. The basis for the Defendants claim is the same as that put forward before Justice Cameron and the Defendants in the present proceedings are clearly of the same clan and descendants of those who were the Defendants before Justice Cameron.
8. Since the orders were made by Justice Cameron the Defendants have occupied the land and erected dwellings on the land without authority from the Claimants. The Claimants filed the Claim in this matter on 19 July 2019. In that claim the Claimants sought orders for the defendants to remove all buildings and structured erected by them on the land and be permanently restrained from using or occupying the land and for an enforcement order delivering possession of the land to the Claimants.
9. The Claim was served on the Defendants Alfred Pita and Alick Hou on 25 July 2019. The claim was served on the Defendant Nelson Thoa on 6 August 2019. The Defendants took no steps in the proceedings until 22 August 2019 when they instructed present counsel.
10. On 12 September 2019 the Claimants filed an application for Default Judgment. No defence had been filed on behalf of the Defendants. It was not until 27 November 2019 when the Defendants filed a Defence and Cross Claim. On 28 November 2019 Counsel for the Claimants and Counsel for the Defendants appeared before Justice Faukona who made direction orders which included an order that the matter would be listed for 9 March 2020 at 9.30am for hearing the application for a default judgment.
11. On 9 March 2020 the Court proceeded to hear the application for default judgment. The Claimants were represented but there was no appearance on behalf of the Defendants. Present counsel claims he arrived at Court by 9.30am but the Court had started before that time and when he arrived at Court the default judgment had already been entered. Counsel for the Claimants disputes that the Court started and completed the hearing before 9.30am. This Court rejects the claim that Counsel for the Defendants was present in Court at 9.30am and is satisfied that the Court did not commence until 9.30am.
12. No appeal was filed against the default judgment. On 11 June 2020 the Defendants filed the present application to set aside the default judgment dated 9 March 2020 and the Application to stay the enforcement orders.

The Application

13. Counsel for the Defendant claims that the Application to set aside the Default Judgment was made within three months after the judgment was entered. That is simply not correct. The default judgment was granted on 9 March 2020. Three months from that date would therefore conclude on 8 June 2020. The Applications were filed on 11 June 2020. Even if the time had run from the date the orders were perfected the three months would have expired the day before the applications were filed.
14. However, for reasons set out below, whether or not the applications were filed after the expiry of three months does not affect the decision in this case. Rule 9.53 of the Solomon Islands Courts (Civil Procedure) Rules 2007 sets out what must be included in the application in these circumstances. Rule 9.54 sets out the requirements to be established before the Court may set aside the default judgment.
15. Rules 9.53 and 9.54 provide:
    • “9.53 The application:
    • must set out the reasons why the defendant did not defend the claim;
    • and
    • must, if the application is made more than three months after the
    • judgment was entered, explain the delay—and the court shall not set the judgment aside unless it is satisfied that it is in the interests of justice so to do; and
    • (c) must give details of the defendant's defence to the claim; and
    • (d) must have with it a sworn statement in support of the application.
    • 9.54 The court may set aside the default judgment if it is satisfied that:
    • (a) the defendant has shown reasonable cause for the delay in defending the claim; and
    • (b) the defendant has a meritorious defence, either about his or her liability for the claim or about the amount of the claim; and
    • (c) there is no substantial prejudice to another party in setting aside the judgment that could not be rectified by a costs order.”

Discussion

16. The Defence has given several reasons for not filing a Defence. The first was that the Defendants were wanting to be represented by the Public Solicitor but found that that agency was unable to assist them. They then alleged that they were unable to arrange funds and instruct present counsel until 22 August 2019. The rules required a defence to be filed within 28 days of the service of the claim on the Defendants. By the time counsel was instructed application could have been made to extend that time if counsel considered more time was required. No such application was made.
17. Counsel for the Defendants argued that the delays in this case were brought about because of the threat of Covid-19. That argument must be wrong as the world had not even heard of Covid-19 by the time the defence was due. It was not even known by the time the defence was eventually filed. The defence was not filed until 27 November 2019, the day before the Court was to hear from counsel concerning the date for hearing the application for a default judgment.
18. The Court of Appeal in Guo Fengli Chi v Guo Fengli [2012] SBCA 11 at paragraph 15 discussed the issue of reasonable cause for delay in the filing a defence. In Guo Fengli Chi there was a much shorter delay than in these proceedings where more than three months passed after counsel was instructed. There the claim was served on 17 June 2011, the time for filing the defence expired on 1 July 2011. On 18 July judgment was entered. The defendant had suffered ill health and had written to counsel for the Complainant denying that the amount claimed was owed and proposed that the matter could be settled out of Court. The Claimant’s solicitor said that he would seek instructions and inform the defendant of his client’s response. He did not make any further response but proceeded to apply for a Default Judgment. At paragraph 17 the Court said:
    • “Of course, it may not be that every such offer will justify a delay in seeking judgment by default. ...The Application of the Rule is to be judged in a common sense fashion by asking what might a reasonable person do in this situation. A range of reasonable responses is available. Providing the defendant has acted as a reasonable person might, then that conduct should be regarded as potentially within the boundaries of the notion of “reasonable cause”.
19. In addition, in Guo Fengli Chi there was evidence of the serious ill health of the defendant which the Court found prevented the defendant from defending the claim from 1 July 2011. There was no such evidence in this case.
20. It follows that there has not been any reasonable explanation for not defending the claim between 22 August 2019 and 27 November 2019. The Court cannot set aside the default judgment unless of all three elements of Rule 9.54 have been satisfied. The first of those is showing reasonable cause for not defending the claim, the second that the Defendants have a meritorious defence and the third that there is no substantial prejudice that cannot be rectified by a costs order. The Court is not satisfied that the Defendants have shown reasonable cause for not defending the claim. That alone deals with this application. However, it is in the interests of justice to also deal with the second issue, that is whether the Defendants have a meritorious defence. The defendants must satisfy the Court that they do have a meritorious defence in addition to having a reasonable explanation for not defending the claim.
21. The Defendants allege that their Sili Clan of Ghaobata tribe are the original custom owners of the land. Further they allege that on 14 October 2004 a custom chupu ceremony was prepared by the Defendants’ clan for the Claimants. The Defendants allege that the registration of the land was acquired through fraud or mistake.
22. The land was registered in 1975. The proceedings before Justice Cameron involved the same Claimants, the same land and the same issues. The Defendants in those proceedings were of the same line as the present Defendants. The decision of Justice Cameron was not appealed. The Court of Appeal in Talasasa v Bea [2016] SBCA 16 discussed the issue of Res Judicata. At paragraph 12 the Court said:
    • “Res judicata does not only cover issues litigated but also issues which should have been litigated by the parties when the matter was before the earlier tribunal.”
23. Later at paragraph 15 the Court said:

“Similarly we grant the order sought that the issue of customary land ownership is res judicata as betwee parties to this chis case and members of their line.” It follows that this Court must accept the submission by the Complainants that the issues put forward by the Defendants in this Court cannot be raised in this Court and must be disposed of in accordance with the principle of res judicata. It does not matter that the Defendants are not the same persons who litigated the issues in 2010 as they are of the same line as the Defendants in the earlier litigation.

24. The finding of res judicata disposes of the arguments put forward by the Defendants such that the answer to the question, do the Defendants have a meritorious defence, must be answered in the negative.
25. In terms of Rule 9.54(b) the Court cannot be satisfied that the Defendant has a meritorious defence either about liability or quantum. It follows that this Court must dismiss the application to set aside the default judgment.
26. Given the findings of the Court it is not necessary to consider Rule 9.54(c) to determine whether there is substantial prejudice that could not be dealt with by way of costs.
27. Counsel for the Defendants argued that the Registrar cannot issue an enforcement order because unlike Rule 21.127 which allows the court or registrar to issue an enforcement order without a hearing, Rule 21.132 which deals with an enforcement order for possession of land refers only to a court. The Court does not propose dealing with this argument as it is clear that an enforcement order is required. The Court therefore grants a fresh enforcement order for possession of the land, authorising the Sheriff to enter on the land and deliver possession of the land to the Claimants.
28. I am advised from the bar that the costs ordered previously have not been paid. What is clear is that the decision of the Commissioner of Lands appointing trustees in 1975 was known by the parties from that date. The Sili Clan chose to occupy and erect buildings on the land in the knowledge that the land was registered and trustees were appointed. In 2010 the Court made the orders set out paragraph 6 above. Notwithstanding those orders it seems clear that the Defendants have treated the Court orders with some contempt. The Defendants have resumed occupation of the land and erected buildings on the land. When served with Claim the Defendants chose to not file a defence until the day before the date for the default judgment application was to be set. In that defence and cross claim, the Defendants pleaded matters that their counsel must have known could not be raised because of the decision in the proceedings in 2010.
29. In these circumstances the Court orders the Defendants to pay the costs of the Claimants on the basis set out in Rule 24.5 of the Rules.

By the Court
Justice Howard Lawry
Puisne Judge