IN THE SUPREME COURT OF			Civil  
THE REPUBLIC OF VANUATU	Case No. 23/3209 SC/CIVL 
(Civil Jurisdiction)  

BETWEEN:	COMPUTER AND NETWORK SERVICES LIMITED
Claimant   
	
AND:
	PUBLIC SERVICE COMMISSION
First Defendant 
    	
AND:
	THE REPUBLIC OF VANUATU
Second Defendant    
	
Date:                                  30 August 2024
Before:	Justice M A MacKenzie
Distribution:	Mr E Nalyal for the Claimant 
	Mr F Bong for the First and Second Defendant

DECISION

The issue

1.	The First and Second Defendants seek leave to file a defence out of time. The Claimant’s position is not known to the Court, as no response has been received within the 14 days directed. As per the Minute of 9 July 2024 (“the Minute”), the Claimant had liberty to respond 14 days after the Defendants filed and served the documents detailed at paragraph 4 of the Minute.

2.	It is not dispute that the defence filed by the First and Second Defendants is well out of time. It was filed approximately 6 months after service of the claim. 

Timeline

3.	The following is a timeline of steps taken in the proceeding;
21 November 2023 – claim filed 
28 November 2023 – claim served on both the First and Second Defendants.
11 March 2024 - proof of service filed
21 May 2024 – defence filed
21 May 2024 – request for default judgement
8 July 2024 – sworn statements filed and support of defence
9 July 2024- judicial conference
9 July 2024 – memorandum seeking judgement by default served on the First and Second Defendants
14 August 2024- Defendants file and serve ( proof of service filed ) an application for leave to extend the time to file a defence and a response to the request for default judgment.

The Claim

4.	The claim relates to 2 separate agreements entered them into by the Claimant.

Agreement one  

5.	The first agreement relates to an agreement between the Claimant, Computer and Network Services Ltd and the First Defendant, the Public Services Commission for the Claimant to develop and provide to the First Defendant a human resource management and information system. The contract price was 17.100,000 VT. In part satisfaction of the contractual arrangements, 8 million VT has been paid by the First Defendant. 

6.	The Claimant and the First Defendant both assert that the agreement has been breached. The Claimant asserts that the First Defendant has failed to pay the balance of the contract price. The First Defendant asserts that the company has failed to comply with its obligations under the agreement and as such, the agreement was terminated for non-performance.

Agreement two

7.	The second agreement is between the Claimant, and both the First and Second Defendants. Under this agreement, the Claimant was to install and configure finger scan machines for both Defendants at various locations, both in Port Vila and at their offices on other islands. The work has been completed. The contract price was VT 4.6 million. VT 1.5 million has been paid to date. 

8.	The First and Second Defendants acknowledge their obligation to make payment under the second agreement.

Should leave be grounded to file the defence out of time ?

9.	Rules 1.2, 4.13(2) and 18.1 of the Civil Procedure Rules are applicable.

Rule 1.2 says – 

Overriding objective

1.2 (1) The overriding objective of these Rules is to enable the courts to deal with
            cases justly.

      (2) Dealing with cases justly includes, so far as is practicable:
(a) ensuring that all parties are on an equal footing; and
(b) saving expense; and
(c) dealing with the case in ways that are proportionate:
(i) to the importance of the case; and
(ii) to the complexity of the issues; and
(iii) to the amount of money involved; and
(iv) to the financial position of each party; and
(d) ensuring that the case is dealt with speedily and fairly; and
(e) allotting to it an appropriate share of the court’s resources, while taking into account the need to allot resources to other cases.

Rule 4.13(2) says-   

Times for filing documents

4.13 (1) The following documents must be filed within the following times:
(a) the defendant’s response must be filed and served within 14 days of the date of service of the claim;
(b) the defence must be filed and served within 28 days after the date of service of the claim, except if subrule (2) applies;
(c) the claimant’s reply must be filed and served within 14 days of the date of service of the defence;
(d) if the defendant has made a counterclaim against a third party – the reply containing the defence to the counterclaim must be filed and served within 28 days of the date of service of the counterclaim;
(e) if the defendant has made a counterclaim against the claimant or a third party – the defendant’s reply to the claimant’s or third party’s defence to the counterclaim must be filed and served within 14 days after the service of the claimant’s or third party’s reply.

                                   (2) The defendant may file a defence although he or she has not filed a 
                                           response. However, if he or she did not file a response, the defence must be  
                                           filed within 14 days of service of the claim.

        (3) If:
(a) the defence includes a counterclaim; and
(b) the claimant has filed a defence to the counterclaim; the defendant may file and serve a reply.

         (4) Each document must be served as set out in Part 5.

Rule 18.1 says- 

Extending and shortening time

18.1 (1) The court may, on its own initiative or on the application of a party, extend or 
              shorten the time set out in these Rules for doing an act.

        (2) The application may be made before or after the time for doing the act has               
             ended.

10.	As rule 1.2 of the CPR says, the overriding objective of the rules is to enable the courts to deal with cases justly. In Dinh v Polar Holdings Ltd [2006] VUCA 24, the Court of Appeal affirmed observations previously made in Fujitsu (NZ) v International Business Solutions Limited and others [1998] VUCA 13 that “...the Rules of Court are intended to further the interest of fairness and justice, and they must be applied with common sense in a realistic way to ensure that the purpose, not just the letter, of the Rules is achieved”

11.	Neither Defendant filed a response. Therefore, rule 4.13(2) applies. A defence had to be filed within 14 days of service of the claim. As noted above, the defence was filed well outside the 14 day period. Pursuant to rule 18.1, the Court may exercise its discretion to extend the time set out in the rules for filing a defence. The purpose of rule 18.1 is to avoid an injustice. 

12.	The Defendants have been very tardy in filing a defence. The Claimant did not proceed with any great haste either, given the timeline set out above. But more relevantly, there is an arguable and triable issue in respect of the agreement between the Claimant and the First Defendant in relation to the first agreement.  Was there an issue with non-performance of the contract? Should the balance of the contract price be paid to the company? As noted by counsel, there is a significant sum of money at stake. That observation cuts both ways.

13.	There is a factual dispute as to whether the Claimant has performed it obligations under the agreement. That requires a full ventilation at a trial. Fairness and justice then require that leave be granted to extend time for the filing of the defence out of time, having regard to the overriding objective set out in rule 1.2.

14.	The Court notes that there is no dispute about the second agreement. The First and Second Defendants should meet their contractual obligations and pay the amount outstanding, as there is no dispute about that part of the claim.  
Outcome and directions

15.	Time for the First and Second Defendants to file a defence is extended. In such circumstances, I do not enter a default judgment. There is a triable matter which needs to be aired at a trial.

16.	There is to be a conference at 8am 16 September 2024 to progress the proceeding.

DATED at Port Vila this 30th day of August 2024
BY THE COURT 

…………………………………………. 
Justice M A MacKenzie