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Solomon Telikom v Attorney General [2007] SBHC 109; HCSI CC 394 of 2006 HCFJ 125 of 2007 (12 September 2007)

HIGH COURT OF SOLOMON ISLANDS

Civil Case No. 394 of 2006

SOLOMON TELEKOM

-v-

ATTORNEY-GENERAL (Representing the Telecommunications Authority), AND DIGICEL PACIFIC LIMITED; 2nd defendant, DIGICEL [SOLOMON ISLANDS] LIMITED 3rd defendant

Date of Hearing: 27 August 200
Date of Ruling: 12 September 2007

J. Sullivan QC with R. Kingmele for the Plaintiff
No Appearance of Attorney-General on argument
A. Radclyffe for 2nd for the Defendant

RULING on application to extend interlocutory injunction following joinder of second defendant

Brown, J:

1. By summons of the 6 June the plaintiff seeks various additional orders to those made earlier on the 13 December last.

2. By that earlier order [which joined Digicel Pacific Limited in these proceedings seeking declaratory orders], that company was restrained from acting further under an Experimental Licence issued by the Telecommunications Authority in favour of "Digicel". Such Experimental Licence was removed to this court and quashed. When hearing the plaintiff in support of its claim for relief in December 2006, I noted that the Attorney-General, the appropriate legal representative for the Telecommunications Authority, had not appeared as Counsel. For reasons which I gave, I proceeded to hear the application. Again the Telecommunications Authority (the "Authority") is not represented before me although an appearance in these proceedings has been filed. I am satisfied notice has been given the Attorney of this hearing.

3. My earlier reasons touched on the fact that Digicel had not at that stage, been incorporated in the Solomon Islands. I also quoted from the material filed on behalf of the Authority by affidavit of Mr. Robert Bakelena who said; "I am informed by my legal advisers and verily believe that in the circumstances of this case I am entitled in law to amend the Plaintiff’s licence by converting it into a non-exclusive licence and unless I am restrained by an order of this Honourable Court or otherwise ordered not to do so, I will proceed to follow that course".

4. Telekom had raised the exclusivity of telecom business in terms of its licence and I was satisfied public interest in enforcing "due process" under the telecommunications licence justified the interlocutory orders consequently made.

5 With the incorporation of Digicel Pacific Limited, the plaintiff seeks to join that company as a 3rd defendant, with consequential leave to amend the writ of Summons and documents filed under O. 61 to reflect such joinder with regard to paragraphs 1, 2, 3, 5 & 6 of the originating summons. Mr. Radclyffe for the 2nd and 3rd defendants takes no issue. The orders were accordingly made.

6. Mr. Radclyffe takes issue however with the proposals in paragraph 4 of the summons before me today. By that paragraph the plaintiff seeks to particularise the nature of the work which it seeks to restrain and names the persons and functionary sought to be caught. Those persons include the two named entities as "2nd and 3rd defendants their officers, employees agents and contractors, including without limitation David Dillon Fabian Williams, Michael Chite and Site Acquisition Services and any subsidiary of or company associated with the 2nd and/or 3rd defendants".
7. Mr. Radclyffe says widening the terms of the injunction as sought by the plaintiff is both unnecessary and oppressive. He addressed the various orders sought by paragraphs 4 and I shall deal with them in order.

[1] Paragraph 4 (a) - "doing anything in purported reliance upon the Experimental Licences" while the works contemplated by site Acquisition Services may be related to Experimental Licences, the geographical extent of the proposed works coupled with the absence of any apparent connection leaves me in no doubt that such contemplated walks are beyond the scope of any purported Experimental Licence. In any event, such licence has, Mr. Radclyffe says, expired. He says there is little purpose then in making such an order. I intend to extend it however to the new company.

[2] Paragraph 4 (b) - applying for renewal of such licence.

The current injunction affects Digicel Pacific Limited and its officers, but it would be reasonable to extend the restraining injunctions to include the 3rd defendant now joined. I so order.

[3] Paragraph 4 (c) - applying for any telecommunication licence under the Telecommunications Act.

Mr. Radclyffe says that the existing injunction supports the exclusivity claimed by Telekom in relation to its licence. Consequently to extend the injunction I am satisfied, to include the recently incorporated 3rd respondent would not extend the ambit of the injunction in that regard. I allow the variation.

[4] Paragraph 4 )(d): - pursuing or accepting any telecommunications licence under an application referred to in paragraph 6 of an Exhibit DD -4 to the affidavit of David Dillon filed 25 May 2007 in cc 207/07.

That is covered Mr. Radclyffe says in terms of the existing affidavit. Mr Sullivan says it is not covered by the present injunction for that Dillon’s application had already been made before the injunction date.

I allow the variation.

[5] Paragraph 4 (e): - This is a wide ranging sub paragraph which seeks to prevent any approach to any Government or Provincial Minister or official for any purpose touching on telecom services, whether land acquisition or otherwise; for the erection of telecom facilities; taking steps with that purpose in view to provide telecom services; commencing telecom services; or approaching the plaintiff’s employees to obtain information about the plaintiff’s business, or to offer employment in any telecom business.

This sub-cause was, Mr. Radclyffe says, contentious since it very width exhibits the oppressive effect; it seeks to stifle a right to communicate. [May it be said to impinge on freedom of expression?] He argues that the material read today does not amount to a breach or threatened breach of the existing injunction but rather suggests [to borrow from Mr. Sullivan’s expression) "contravention of the spirit of the order".

8. For the evidence clearly establishes that an entity, Site Acquisition Services is seeking small parcels of land on which to place telecom towers and other buildings about the Solomon Islands. Mr. Sullivan pointed to various parts of the material which he read in support of his claim to vary the injunction. The letter of Mr. Michael Chite published in the Solomon Star dated Wednesday 25 July 2007 conveys the sense of his apprehended contravention of the spirit of the order.

9. A Mr. Michael Chite wrote to the Editor of the "Solomon Star" newspaper dated Wednesday 25 July 2007 complaining about what he says was unfair balance given in an earlier report headed "Landowners cautioned" by the Star’s Moffat Mamu, for that the article imputed "impersonation" by Chite of Solomon Telekom. Mr. Chite impliedly denied any such impersonation but apparently concedes he was the agent for Digicel in the Western Province who had been talking to landowners about land acquisition for the company’s business operations. Mr. Chite accuses Mr. Moffat Mamu the staff report, of being a "propaganda puppet for other", since Mamu’s article reported Digicel’s apparent approach to various landowners in the guise of "Our Telekom". Clearly Mr. Chite takes umbrage at that suggestion, but whether or not that happened is not for consideration and decision here. The point made by the article was that Vella La Vella, Rannogga and parts of Choiseul Provinces landowners needed to be sure with whom they believe they are dealing, for "Our Telekom" denied that any of its officials were "scouting" for land. It follows that Mr. Michael Chite [who says it was him who went to the Western Province], may be presumed to be admitting that he was "scouting" for land; that he was not impersonating "Our Telekom" but equally that competition was to be expected in the guise of his principal whom he declined in his letter to name. Again on reading Mamu’s report, the presumption is Digicel or its subsidiary Site Acquisition Services has been active in seeking expressions of interest from landowners prepared to agree to lease or sub-lease land for telecom site use. Whilst the letter is not evidence going to Digicel’s position, the Deputy Provincial Secretary Western Province does exhibit a perception with which Mr. Sullivan’s general argument accords. Digicel’s behaviour is one suggestive of "full steam ahead".

10. Mr. Sullivan argues that, such behaviour should be curbed, for that it is contrary to the decision handed down in associated proceedings cc 207/07 where I refused Digicel’s leave to seek judicial review of the Telecommunication Licence of Telekom. [That exclusivity provision may be reviewed in 2008 however if steps are taken to review the Licence].

11. Mr. Radclyffe differentiates the issue of the exclusivity from the acts of the respondents for that those acts are at the risk of the respondents. The fact that the respondents’ acts will put them to expense relates to that risk but should not be seen as going to the issue of the plaintiff’s licence. With that I agree, for the process of review, which may or may not result in a change to the terms and conditions of that licence, is exclusive of the Telecommunications Authorities power on any review. Building work done in anticipation of such review must go to the expectation of review, of that there is no doubt, but could not be said to be categorised as acts contrary to the exclusive licence of the plaintiff and current telecom services. What the respondents seek to do by way of work proposed by Site Acquisition Services (SAS) should not, in the courts view, be categorised as directly affecting the right in the plaintiff to its enjoyment of its exclusive licence.

12. What does appear from the originating process is that there is a serious issue to be tried. The plaintiff seeks orders of prohibition directed to the Authority from affecting the plaintiff’s exclusive licence or amending the licence without first affording the plaintiff an opportunity to negotiate changes in accordance with a specific provision of the licence. As well the plaintiff (relying on the licence) seeks an order prohibiting the Authority from granting any other licence which would conflict with the plaintiff’s right to exclusivity. It is plain from the material before me that such grant is contemplated and for the reasons that I gave earlier, I made those earlier injunctive orders.

13. The project document attached to the Deputy Provincial Secretaries letter of the 31 May 2007 to the Branch Manager, Telekom Gizo (annex 20 to Martyn Robinson’s affidavit of the 6 June 2007) is headed-

"Introduction to SAS (Solomon Islands) Ltd. SAS (logo). I reproduce the second page.

"Solomon Islands Gov’t SAS

• The Government is committed to the liberalization of telecommunication.
  
• Interest currently being shown by Digicel

- Injunction by Solomon Telekom/Cable and Wireless prevents competition in the market.

• Solomon Telekom/Cable and Wireless preparing for competition by:

- Reducing Rates
- Launching in Gizo
- Offering new services for mobiles customers"

14. The page would appear to suggest it is collaborative between the Solomon Islands Government and SAS. There is no evidence that the document has been published with the express authority of the Government.

15. The 2nd dot point asserts – injunction by Solomon Telekom/Cable and Wireless prevent competition in the market. That assertion is reflected in the letter by Michael Chite. The assertion overlooks the fact that, on its face, the plaintiff’s licence affords it exclusivity, in accordance with the Authority’s grant. The plaintiff seeks this grant up-held in this court by declaratory orders in terms set out above.

16. Competition in the market is regulated by the Authority. At the moment the exclusive right to Telecommunication Services is "Our Telekom" in terms of a licence given by the Authority.

17. Is there a real risk these assertions by Digicel and its affiliates will, in this environment, be propaganda leading to a public perception adverse to Solomon Telekom for that no reference in Digicel’s Project Document is made to the basis of the injunction, the summons before this court claiming declaratory orders relying on the Authorities licence?

18. Such absence may be calculated to advance Digicel’s public image in the market place but is it of such moment as to justify my extension of the injunctions to prevent, what is clearly preparatory work for another telecommunications provider?

19. The principles applying to the grant of an interlocutory injunction are those set out in American Cyanamid Co v Ethicon Ltd [1975] UKHL 1; (1975) 1 ALL ER 504.

20. In that case Cyanamid had registered a patent in the United Kingdom to protect its absorbable surgical sutures made of a particular kind of chain polymer known shortly as "PHAE". Ethicon, a rival surgical suture manufacturer, sought to introduce their artificial suture, a copolymer, or "XLG". Cyanamid claimed a threatened infringement of their patent, and by notice of motion, sought an interlocutory injunction to prevent the threatened infringement pending trial. The judge of first instance granted the injunction but was over-turned on appeal. The decision of the Appeal Court was taken to the House of Lords. Lord Diplock, in a decision which has stood the test of time, set out principles for the edification of courts faced with a motion for interlocutory injunctive orders. He scotched the prevailing notion that it is incumbent on the court to undertake what is in effect a preliminary trial of the action on evidential material at the earlier stage. The test propounded was "a serious question to be tried" which obviates necessity of finding "a prime-face case" or "a probability" which may lead to confusion as to the object sought to be achieved by the claim to an injunction.

21. In this case it is the enjoyment of the plaintiff’s licence with all its incidents, including, it is argued freedom from competition in accordance with the Authorities grant.

22. Lord Diplock espoused the need, at the out-set, to question whether, if the plaintiff were to succeed at the trial to its claim for declarations, (and consequently a right to a permanent injunction) the plaintiff would be adequately compensated by an award of damages for the loss it would suffer as a result of the defendants continuing to do what was sought to be enjoined between the time of the application and the time of trial. If damages would be an adequate remedy and the defendant would be in a financial position to pay them, no interlocutory injunction should normally be granted. (Diplock LJ at 510). As I said earlier the public interest in according due process to the plaintiff is a material consideration when I look at the appropriateness of damages as an alternative.

23. In this case damages would not be an adequate remedy for the defendants sought to be charged are effectively foreign companies [for that the local company is the subsidiary of the foreign registered company] and there is no evidence to show their capacity to meet or willingness to pay any order for damages against them; damages would not be appropriate in any events. Damages would fly in the face of the current nature of the exclusive licence, and ignore the due process aspect.

24. The terms of paragraph (e) of the extended injunction do not, in my view go so far as to impinge on the enjoyment of the plaintiff’s existing licence. Seeking to sell Digicel’s proposal for its telecommunication business to the government or provincial government authorities is related more to a commercial consideration going to competition in future and not to any actual affect on the enjoyment of the plaintiff’s existing licence. The drafting of the proposal by SAS for landowners to consider a sub-lease of land for SAS purposes is but that, an invitation to treat. The expectation of immediate benefit is probably planted in landowners, but that issue, as Mr. Radclyffe impliedly says, is one for Digicel to manage. With that I agree. To stop Digicel from communicating its proposals, would go beyond the risk of allowing a business with an outstanding need for statutory approval, to actually compete against the plaintiff. It would be tantamount to interfering with Digicel’s commercial interest in perusing its obvious wish to become an alternate service provider in the Solomon Islands, were discretion in the Authority to be lawfully invoked in future. But Digicel’s commercial interest in country does not, of itself, justify this courts help where a direct threat to the plaintiff’s beneficial interest in its licence has not in my view, been shown.

25. On similar principles, the material read satisfies me however, that the plaintiff’s claim to protection in terms of paragraph 4(h) has weight, for the approaches to the plaintiff’s staff, by a group without licensing rights, may be seen to threaten the plaintiff’s business for it is not, as Mr. Radclyffe asserts, a matter for the employees to rebuff approaches of employment (or perhaps indirectly information of commercial value) but rather protection from such insensitive approach to the plaintiff’s work force for failing to take account of cultural dimensions in the Solomon Islands. For it is notorious in the Solomon Islands to relatively easily dissemble and confuse individuals through approaches by persons of seeming importance and authority [as evidenced by the actions of the members of the RSIP pictured chasing news photographers from the dolphin air flight some years ago, actions precipitated by a misguided since of obligation to others than the proper police authority, or the Cornel University scam]. The risk of approaching employees, in this case is apparent on reading the affidavit of Robertson Szetu. Coupled with the earlier material touched on, that of the Provincial Secretaries letter and the letter of Michael Chite in the "Solomon Star", I am satisfied approaches of the kind sought to be prevented should be curbed, for the underlying thread in Digicel and its contractor SAS’s project proposal, is that the opportunity for alternate communication services is being thwarted by the plaintiff by virtue of the injunction which goes to the prevention of competition, when that assertion presumes error in the court before hearing and conveniently ignores the express terms of the plaintiff’s licence issued by the appropriate Authority. It is plain that competing business will take advantage of commercial opportunities, real or perceived and the court should be wary of interfering in a commercial sense. This court should not depart from those principles for granting injunctive orders, but in this case [for the reasons I have given] I am satisfied of the risk of radicalising the community, and since the Digicel approach seems hostile to the plaintiff for ulterior motives referable to the future commercial interests of Digicel, yet where the company plays on the culpability and naivety of others especially employees of the plaintiff, it is appropriate to extend the injunction to prevent solicitations of the plaintiff companies’ employees.

26. In exercise of my discretion I make orders in terms of the summons of the 6 June, paragraphs 1 to 3 inc; paragraphs 4(2) (as amended) (a), (b), (c), (d) (g) and (h); paragraphs (5) and (6); and paragraphs 8 and 9.

27. Liberty to apply.

THE COURT