IN THE SUPREME COURT OF TONGA
Supreme Court, Nuku'alofa

CV 976/2007

Moapa Enterprises Trading as JM Store

v

Island Beverage Ltd

Ford CJ 
4 September 2009; 7 September 2009 

Practice and procedure – application for extension of time to appeal – length of delay significant and unexplained – application dismissed 

The full facts are set out in [2009] Tonga LR 265 

The defendant applied for an extension of time for appealing the judgment of the court delivered on 26 June 2009 and reported at [2009] Tonga LR 265. An additional application was made for a stay of any enforcement proceedings in respect of the said judgment pending the appeal. Both applications were opposed by the plaintiff who contended that they lacked merit and substance. The plaintiff submitted that the defendant was likely to take advantage of any stay of proceedings by transferring ownership of assets to another company and he contended that there was already evidence to that effect. 

Held: 

1. It was entirely in the discretion of the Court to grant or refuse an extension of time. The factors which were normally taken into account in deciding whether to grant an extension of time for serving a notice of appeal were: (1) the length of the delay; (2) the reasons for the delay: (3) the chances of the appeal succeeding if time for appealing was extended; and (4) the degree of prejudice to the would-be respondent if the application was granted. 

2. The length of the overall delay was significant and was not satisfactorily explained. In the draft grounds of appeal, there was not one point of law relied upon and the Court was not persuaded that the defendant made out even an arguable case on appeal. 

3. The justice of the case lay against the granting of the relief sought.

4. The Court declined to grant an extension of the time for appealing. It followed that the application for a stay was also dismissed. 

Cases considered: 
 Revici v Prentice Hall Inc and others [1969] 1 All ER 772 
 Van Stillevoldt BV v El Carriers [1983] 1 All ER 699 

Statute considered: 
 Court of Appeal Act (Cap 9) 

Rules considered: 
 Court of Appeal Rules 1990

Counsel for the plaintiff : Mr Tupou 
Counsel for the defendant : Mr Corbett 

Judgment

The application 

[1] Application has been made by the defendant for an extension of time for appealing the judgment of this court delivered on 26 June 2009. An additional application has been made for a stay of any enforcement proceedings in respect of the said judgment pending the appeal. Both applications are opposed by the plaintiff who contends that they lack merit and substance. Counsel for the plaintiff submits that the defendant is likely to take advantage of any stay of proceedings by transferring ownership of assets to another company and he contends that there is already evidence to that effect. 

The judgment 

[2] In the judgment dated 26 June 2009 the plaintiff was successful in recovering the sum of $16,079.00 together with costs for goods supplied under two invoices dated 29 December 2006 and 3 February 2007 respectively. The claim originally had been for total of $46,280.25 covering goods supplied over a greater period but the proceeding was referred to mediation in May 2008 and the defendant accepted liability in the sum of $30,201.25. Liability in respect of the balance of $16,079 was referred back to this court for determination.

[3] The background to the dispute was that both parties were retailers trading in the buying and selling of a variety of food products, beverages and other grocery products. From about 2004 they operated under an informal trading arrangement whereby each would buy produce from the other for onward sale to the public. The goods were supplied on credit in the sense that no cash would exchange hands but every so often there would be an accounting reconciliation. 

[4] The defendant maintained that the goods supplied under the two invoices in question amounting to $16,079.00 came within the informal arrangement referred to and sought to offset that amount against the total sum it owed to the plaintiff. The plaintiff disputed that contention and claimed that the goods sold under the two orders in question were not consumer goods of the type covered by the trading agreement but items of furniture and accessories which the manager of the plaintiff company had purchased not for the plaintiff but in the manager's personal capacity to take back with him to Fiji upon his leaving the plaintiff's employment in February 2007. In response to that contention the defendant argued that the plaintiff's manager had apparent and ostensible authority to purchase the furniture and other items as agent for the plaintiff. 

[5] The court held that the defendant's owner was aware that the plaintiff manager's authority to make purchases from the defendant as agent was restricted to food products, beverages and other grocery items and it did not extend to the furniture and accessories in question. 

Time for appealing 

[6] Under section 10 of the Court of Appeal Act (Cap 9) (as amended) and Order 5, Rule 2(1) of the Court of Appeal Rules 1990 an appeal to the Court of Appeal in a civil case must be commence within 42 days after the date of judgment by lodging with the Registrar notice of appeal together with the prescribed fee. 

[7] Order 4, Rule 1 of the rules provides that the Court or a single Judge may, on such terms as he thinks just, order that the time within which a person is required to or authorised to do any act be extended or abridged. 

The delay

[8] It was common ground that the 42-day appeal period in this case began to run on 26 June and expired on 7 August 2009. The defendant's application was not filed, however, until 25 August 2009. Counsel for the defendant, Mr Corbett, explained the delay in these terms. Between 25 June and 13 July he was on a trip to New Zealand and he did not receive the judgment until 14 July. He then tried on several occasions to meet with his client to discuss the judgment but he could not contact him. He eventually met with his client on 14 August and provided him with a copy of the judgment. Application for leave to appeal was filed on 25 August. In Chambers, Mr Corbett confirmed that his client had instructed him to appeal on 14 August. Counsel explained that the subsequent delay on his part in acting on those instructions resulted from work pressure. 

[9] Mr Tupou made the point that Mr Corbett would have been aware that the judgment could have been released at any time while he was in New Zealand and he should have arranged for other counsel to collect the judgment and report to him. In all events, as Mr Tupou stressed, when he eventually picked up the judgment on 14 July Mr Corbett would have realised immediately that the 42 day period for appealing was already running and it behoved him in those circumstances to take prompt action to ensure that the appeal was filed prior to the 7 August. 

Relevant principles 

[10] The principles relevant to an application for an extension of time for serving a notice of appeal are stated in The Supreme Court Practice (the White Book), 1991, para 59/4/4 in these terms: 

"It is entirely in the discretion of the Court to grant or refuse an extension of time. The factors which are normally taken into account in deciding whether to grant an extension of time for serving a notice of appeal are: (1) the length of the delay; (2) the reasons for the delay: (3) the chances of the appeal succeeding if time for appealing is extended; and (4) the degree of prejudice to the would-be respondent if the application is granted."

I would simply add that this criteria should not be taken to rule out the consideration of any other factor relevant to the exercise of the court's discretion. 

[11] As was stated in Revici v Prentice Hall Inc and others [1969] 1 All ER 772 (the headnote): 

"The rules of the court must be observed and it mattered not that the plaintiff had offered to pay the costs and that no injustice would be done to the other side. If there was non-compliance with the rules it must be explained and prima facie if no excuse was offered no indulgence should be granted."

Discussion 

[12] The length of the overall delay in this case is significant and it has not been satisfactorily explained. Given Mr Corbett's absence in New Zealand until 13 July it was up to him, as Mr Tupou submitted, to make an extra effort as soon as practicable upon his return to ensure that he contacted his client and obtained instructions regarding an appeal. It is inconceivable that it would have taken one month for Mr Corbett to meet with his client, after all his client runs a local retail store. In Chambers Mr Corbett explained that during the one-month period between 14 July and 14 August he tried to telephone his client on two or three occasions and on one occasion he went to his store but "he was not available". With respect, that explanation is rather unsatisfactory as is the explanation proffered for the additional 11 day delay after counsel received instructions from his client on 14 August to go ahead and file an appeal. 

[13] The defendant did not set out any grounds of appeal in its application filed on 25 August but these were ordered by the court and draft grounds of appeal were filed on 3 September 2009. They are incorporated in 15 separate paragraphs. Mr Corbett was asked at the Chambers hearing to identify what he considered to be the defendant's two strongest grounds of appeal and he identified the following paragraphs: 

"b. The building where Island Beverage is located also sells furniture. This is confirmed in the evidence of Mr. Dharmen Prasad for the respondent when he met with Mr. Paea for the appellant in 2007 that he saw furniture in the building. 

o. It is interesting to note in the evidence for the respondent Mr Reddy stated, "... the furniture came up to but not for JM Store (respondent) went to Rohit at Longolongo." This evidence supports the evidence of Mr. Paea and Ms. Tukia that the furniture was delivered to a house at the back of the appellant store." 

[14] These are factual matters which the court duly took into consideration in reaching its decision. Similarly, the other grounds of appeal also refer to evidentiary matters. There is not one point of law relied upon in the draft grounds of appeal. I am not persuaded that the defendant has made out even an arguable case on appeal. 

[15] The plaintiff claims that it will suffer prejudice if the applications are granted on the grounds that when a bailiff officer went to execute a writ of distress he was informed that the defendant's shop was now owned by Island Furniture which owned all the goods. Mr Tupou submitted, "I fear that the defendant may be shifting ownership of goods between his companies like Island Furniture thus leaving no goods upon which the writ of distress can be executed against the defendant As was stated by Griffiths LJ in Van Stillevoldt BV v El Carriers [1983] 1 All ER 699, 704 h, whether or not a party suffers prejudice "is undoubtedly a very important factor to weigh in the balance." 

[16] There is another factor relevant to the exercise of the court's discretion and that relates to the defendant's lack of good faith. As noted above, in May 2008 the defendant accepted at a mediation referral that it was in debt to the plaintiff in the sum of $30,302.25 and on 5 February 2009 the court made an order requiring the defendant to pay that amount to the plaintiff "forthwith". The defendant has blatantly ignored that court order and no part of the judgment debt has been paid. In those circumstances, I fail to see why the defendant should be granted a special indulgence by the court on this occasion. 

Conclusion

[17] While the period of delay in itself may not be fatal to the application, when taken with the other factors I have referred to such as the absence of an arguable case on appeal, the likely prejudice to the plaintiff and the lack of good faith on the part of the defendant, I conclude that the justice of the case lies against the granting of the relief sought. 

[18] In the exercise of my discretion, therefore, I decline to grant an extension of the time for appealing. It follows that the application for a stay is also dismissed. The plaintiff is awarded costs on the application to be agreed or taxed.