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Solomon Import Export Ltd v Onika [2018] SBHC 44; HCSI-CC 102 of 2014 (16 April 2018)

HIGH COURT OF SOLOMON ISLANDS
(Faukona PJ)

Civil Case No. 102 of 2014

Mr G. Suri for the Claimant
Mr C. Hapa for the Second Defendant
Mr J. Taupongi for the Third Defendant
No one for the First Defendant who is now deceased

APPLICATION TO SET ASIDE CONSENT JUDGMENT

FAUKONA J: An amended claim for judicial review was filed by the Claimant on 11^th April 2014. The original parties to this cause of action were the current parties; the former second Defendant who was the Deputy Registrar of Titles represented by the Attorney General, and the Attorney General himself as third Defendant.

2. This cause of action concerns registered land PN 197-010-262 situated at Ranadi, Honiara. The fixed term estate in the land was registered in the name of the Claimant on 12^th April 2011.
3. By a letter dated 21^st March 2014, the former Deputy Registrar informed the Claimant that he had de-registered the fixed term estate upon direction by the first Defendant who was the Minister of Lands, Housing and Survey at that time.
4. The first, fourth and fifth Defendants were sued because the Claimant asserted they had indulged in various actions which caused or contributed to the de-registration of PN 197-010-262.
5. On 10^th June 2015, the second and third Defendants filed a Statement of Admission of facts and point of law pleaded in this case, that the de-registration was wrong. Follow on from that, the Claimant, the second and the third Defendant made and executed a Consent Judgment signed by the Registrar of the High Court, and was perfected on 16^th June 2015.
6. By the Consent Judgment, reliefs sought in paragraphs A, B, C and D of the amended claim have been settled. As a result, the Claimant had on 1^st July 2015, filed a notice of discontinuance of the case against the second and the third Defendants.
7. The third Defendant on 25^th October 2016 filed an amended application seeking an order that the Consent Judgment executed by the Claimant and the second and third Defendants, and perfected by the Registrar of the High Court on 16^th June 2015 be set aside.
8. The third Defendant avers that the Consent Judgment is invalid and ineffective and ought to be set aside under R17.55 (a), as read with R17.45 of the Civil Procedure Rules, and under the excise of the inherent powers of the High Court.
9. The third Defendant appears as not been aware of the Attorney General's Statement of Admission or the Consent Judgment until late July 2015. By 7^th August 2015, this application was filed.
10. The reason for seeking order to invalidating the Consent Judgment is summed up in six grounds advanced by the third Defendant supporting the six reliefs sought.

The Law on Consent judgment and orders:

11. Rule 17.45 of Solomon Islands Court (Civil Procedure) Rules 2007 or CPR states,

“The Registrar of the High Court may make an order in a proceeding”

if:

(a) the parties affected by the order consent to the order; and

(b) the registrar considers if appropriate.

12. Rule 17.55(a) states;

The Court may set aside an order at anytime if;

1. the order was made in the absence of a party.

Grounds for setting aside consent judgment:

13. There are wider perspective reasons for setting aside Consent Judgment as stated by the case of Tokalaulevu v Dantzler Inc,^[1] a case from Fiji, which Judge Nanayakkara stated by quoting from Halsbury's Laws of England;^[2]

“...a consent order or compromise may be set aside on a ground which would invalidate any other agreement between the parties including mistake, illegality, dures or misrepresentation.”

Hammett PJ in Mohammed Rasul v Hazra Singh^[3] also stated;

“In my opinion, once the parties to a dispute have joined issue in litigation and have later compromised their action and filed in court the terms upon which the action had been settled and the plaintiff was discontinued the action as was done in this case, the same issue cannot be made the subject of the fresh action until the compromise in the previous action has been set aside in a action brought for that express purpose based upon grounds of some considerable merit. To hold otherwise would, in my view, be to deprive the parties to a compromise of that sense of finality upon which both parties to any compromise are entitled to rely and base their future conduct.”

14. On setting aside cosent order Halsbury Laws of England^[4] stated;

“In Purcell v FC Trigal Ltd (1970) 3 All ER 671, Winn LJ said at 676: “It seems to me that if a consent order is to be set aside, it can really only be set aside on grounds which would justify setting aside a contract entered into with knowledge of the material matters by legally competent persons, and I see no suggestion here that any matter that occurred would justify the setting aside or rectification of this order looked at as a contract.”

Privy to consent order:

15. The courts have held that the consent judgment was binding only on the parties to it who had consented and executed the consent judgment. In Mojoria v Jino^[5], the Court of Appeal stated;

“Not only was the Appellant not a party to the High Court proceedings, he was not a party to any of the preceding proceedings including, in particular those instituted and settled in the CLAC. As this Court held, the consent judgment was binding only on the parties to it and was not protected by the privative provisions of S.10 of Forst Resources and Timber Utilization Act.” “...we do not see that Appellant had standing to contest the consent judgment since he was not a party to it. These submissions fail.”

16. The Claimant agrees by virtue of the principle, the third Defendant has no right to seek to impugn the consent judgment because it is not privy to the consent judgment.

Final judgment - Challenge by fresh action:

17. The law in precedence had well defined, with a abundant precision that Consent Judgments or Orders are obviously be set aside by a fresh action; not by application within the same proceeding.

18. In the case of Lipsey v the State^[6], the Court stated;

“I have been unable to find any PNG decision on this matter, but the law is nonetheless clear. Common law inforce prior to 1975 shows essentially that, “...when a final judgment has been passed and entered, the court cannot set it aside unless a fresh action is brought for that purpose, although it has seen entered by mistake.” “A court has no power to vary a consent judgment or order made previously in that court and, therefore, the only means open to a party to set aside a consent judgment or order on the ground of fraud or mistake is to bring a fresh action for the purpose. Basically, the consent order finalizes the matter between the parties. The only discretion remain in the Court after entering the consent judgment or order appears to be a power to vary or discharge such a judgment or order, if it has not been finalized, ie, the order has not been sealed. This discretion will only be exercised where grave injustice is shown to be likely to the party affected.”

19. The court in the same above case also pointed out that a judgment or order that finally disperses issues between the parties, the only way of doing it open to him is by an appeal to the higher court or bringing a fresh action to set it aside.

Court’s discretion to set aside:

20. Rule 17.55(a) sets out various circumstances which the court may exercise its discretion to set aside an order at any time. In the current case the relevant situation is under paragraph (a) the order was made in the absence of a party.
21. In the case of Lipsey v the State^[7] the court has the power to discharge such a judgment or order if it was not yet finalized, ie, the order has not been sealed. And that the discretion will only be exercised where grave injustice is likely be shown to the party affected.

Ground (1) – Amendment of defence without consent or leave:

22. The main argument instituted by the applicant is that the Attorney General had amended his defence without consent or leave of the court, therefore the statement of admission was not pleaded, hence, had improper to make such admission at that stage.
23. The statement of admission by the Attorney General in fact contain the admission by the Deputy Registrar, in his letter of 21^st March 2014, that the registered land PN-197-010-262 was de-reghistered upon directive issued by the Minister, late Honorable Onika, the first Defendant.
24. That admission was contrary to the denial by the Attorney General that the de-registration of PN 197-010-262 was invalid but was based on valid directive issued to the Minister, acting on a Cabinet decision. By the statement of admission, the Attorney General had withdrawn his denials instead admitted the allegations set out in the amended claim as true.
25. From the background chronology of facts, pleading in this case was closed by 28^th August 2014. The statement of admission was filed on 10^th June 2015, and the Consent Judgment was perfected on 16^th June 2015.
26. The status of the statement of admission was expressly described by the Counsel for the Claimant in paragraph 7.2 of his submissions as “evidence” that indeed prompted the impression whether the evidence in the statement of admission supports any facts or law pleaded in the amended claim. Common knowledge dictates that any sworn statement or evidence filed must support facts or law pleaded in the claim or defence. In this case the admission statement did not support the original facts pleaded in the defence but rather introduced or raised new issues. It was a new evidence which absolutely detracting the entire second and the third Defendant’s case from facts pleaded originally.
27. If the second and third Defendants are so desirous to rely on new evidence entrenched in the admission statement, I think Mr Taupongi is correct, an amended defence ought to be consented to or leave be granted by the court after being sought. Nothing was done in the current case. The evidence in the statement of admission must support facts or law pleaded in the defence. It can’t introduce new evidence.
28. Also noted that the statement of admission is not a sworn statement but a mere statement. A statement of fact has always have its place in the statement of pleadings, be it a claim or defence. Sworn statement should contain evidence that support facts pleaded in a claim or defence. It is rather ambiguous to treat the statement of admission as evidence because it does not support any fact pleaded in the second and third Defendants defence.

Ground 2 – Ambush on Defendants:

29. This brings us to the second ground which the applicant submits that the Attorney General by revolving its position tantamount to ambush on the other Defendants. The Counsel for the third Defendant refers to a number of case precedents, such as South Pacific Oil v GRP & Associates^[8], Roni v Ross Mining (SI) Ltd^[9], and Gete v Wereke^[10].
30. Those cases focussed on the purpose of pleadings to uphold the objective of the rules, that is to enable the court to deal with the case justly, ensuring parties address and identify the real issues at an early stage. And that the statement must set out relevant facts but not evidence.
31. The cases also addressed the purpose of pleading is to identify matters the parties differ on, and identify issues the court will adjudicate on. Also that pleading should not embarrass the Defendants but state facts that put the Defendants on their guard.
32. This should have the same impact on the second ground which advocate ambush on the Defendant. In reality, my perception is that there may be some minute percentage in that context, but the motive is absolutely different. Whether the Claimant and the second and the third Defendants had been colluded or otherwise, the action resort to, by consenting a judgment after the statement of admission was filed, was on intention to absolutely deprived the other Defendants from being given the opportunity to be heard fully and fairly. The Attorney Generally had never intended to comply with rules for amending pleadings – R5.35, to amend the defence.
33. From the consent judgment, reliefs A to D in the amended claim are deemed settled. Practically, relief D should settle the case against the third Defendant and the title to the land legally be relinquished to the Claimant. In fact reliefs A to C are contributing orders which eventually led to the re-registration of the Claimant’s name as the owner, with the third Defendant losing out.
34. Apparently the Consent Judgment had affected the legal rights of the third Defendant without being allowed to participate and be heard. Would the third Defendant submit to, and abide with, such judgment without questioning it? The Defendants indeed have legal obiligation to oppose and to institute a cause of action to question it. Is it a fair consent judgment? I do not think so from the manner in which it was formulated and executed.

Ground 3: Non-compliance with Evidence Act:

35. It appears the Claimant and the Attorney General seemed to concede with the Consent Judgment following the statement of admission, based on S.21 of the Evidence Act. However, S.21(1)(b) clearly states that the court may “admit evidence offered in any form or way agreed by all parties.”
36. In the case of Fareast Enterprises (SI) Ltd v Tsuki^[11]. His lordship Kabui J (as he was then) quoted a passage from the case of Wilding v Sanderson^[12] which stated;

“A consent judgment or order is meant to be the formal result and expression of an agreement already arrived at between the parties to proceedings embodied in an order of the Court. The fact of it being so expressed puts the parties in a different position from the position of those who have simply entered into an ordinary agreement. It is of course, enforceable while it stands, and a party affected by it cannot, if he conceives he is entitled to relief from its operation, simply wait until it is sought to be enforced against him, and then raise by way of defence the matters in respect of which he desires to be relieved. He must, when once it has been completed, obey it, unless and until can be set aside in proceeding duly constituted for the purpose.”

37. It is apparent the above case deals with the issue of whether there was agreement between the parties before a consent judgment or order was executed. And once proved there was no agreement, it is a ground for setting aside. The most significant thing expressed by the case is that a consent judgment or order is a result of agreement arrived at by the parties which is enforceable. That simply means the entire case had been concluded and settled by execution of the judgment or order by all the parties.
38. In the current case, there is no dispute, the second and third Defendants, in this application denied giving consent to the Consent Judgment, or agreed to by all parties in these proceedings. They were infact excluded by motive from the agreement and hence gave no consent at all. Therefore the consent judgment was not validily made under the S.21 of the Evidence Act.

Ground 4: Non-compliance with rules in Consent Order:

39. Rule 17.45 clearly stated that the Registrar may make an order in a proceeding if:

(a). the parties affected by the order consent to the order; and

(b). the registrar considers it appropriate.

40. The original parties to this case were six (6). The consent judgment was agreed upon by the Claimant and the second and third Defendants of the original parties. As a result they endorsed and signed it.
41. Unfortunately, the Consent Judgment did not only affected the parties who agreed to it. It also negatively affected the other Defendants who did not know and did not consent to the Consent Judgment. One cannot interpret R17.45(c) to mean that parties affected are some of the parties of the case and not the rest. That is limiting the cause of action which is contrary to the claim, which alleged the fourth and fifth Defendants were sued because of their suspicious involvement in the de-registration of the land in question. And of course the fifth Defendant (currently third Defendant) was bound to lose its land; it was affected due to relief D been granted.
42. I think the Registrar of the High Court was not well versed with R.17.45(a), if not wrongly interpreted, and thought that the Claimant and second and third Defendants were the only parties affected by the Consent Judgment, without foreseeing other Defendants, in particular third Defendant who will be prejudicially affected. Therefore the Registrar was acting in breach of the rule when she endorsed the Consent Judgment on 16^th June 2015.

Ground 5: Consent judgment made in the absence of Defendants:

43. This ground should be rated as the most fundamental ground of all the grounds rely on to set aside the consent judgment. All other five(5) grounds should hang on this particular ground, if not, others are not necessary at all. R17.55(a) outline the basis upon which a consent order ought to be set aside, because it was made in the absence of other party.
44. The third Defendant as an Applicant need only to show that it was not a party in the negotiations which later materialized in execution of the Consent Judgment. And that the Consent Judgment was made without its knowledge, consent and approval. Secondly, it needs to show that it was not given the opportunity to be heard. Thirdly, it needs to show that the effect of the Consent Judgment had deprivative course on its legitimate rights, and had prejudicial effect on it.
45. From the stand point of the Claimant after the Consent Judgment was signed, PN: 197-010-262 will be re-registered in the name of the Claimant as the registered owner. That will render the third Defendant losing the land without being heard. Is that justice in the normal sense? Or is it one at two parties dominating and dragging others squeezing their throat off. Conceivably, the rule of natural justice and fairness should apply to all circumstance in a proceeding. One party should not unlawfully benefit on the expense of the other.
46. I have given my opinion in the interpretation of S.21 evidence Act in paragraph (38) above. I have also diligently expressed the benefits and the deprivative effect by the parties in paragraph (34) above. Now it is suffice for me to conclude that the Claimant and the Attorney General who represented the second and the third Defendants had never intended to include the fourth and fifth Defendants to have their consent, or be heard, when the terms of the Consent Judgment was negotiated and concluded.
47. The consent judgment was executed and endorsed on an unprecedented motive to exclude other Defendants. If the other Defendants were given opportunity to be heard there was likelihood they would object to. By agreeing to the Consent Judgment without the fourth and fifth Defendants/Applicant is depriving them; this ground is made out on the balance.

Ground 6: Consent Judgment in judicial review case:

48. The major argument under this ground is that because a claim for judicial review is a review of executive action or decision portrays a public function which will be reviewed by a judicial function, should not be decided by mere consent. Therefore reiterated that public function must have regard to public interest in doing so.
49. That proposition is supported by the case of Kovalev v Minister for Immigration & Multicultural Affairs^[13], French J stated,

“In the exercise of its powers the court is not merely giving effect to the wishes of the parties, it is exercising a public function and must have regard to the public interest in doing so... It is important therefore that the court itself addresses and is satisfied of the basis upon which its order is to be made and in particular where the order sets aside the decision of an official decision maker or a tribunal.”

50. The above case sets out important guideline which are relevant and cardinal to the courts. The rational is not too difficult to abreast but within vision. Sometimes the court is so luxurious and often go by the wishes of the parties and had fallen short to address issues pertinent for public interest. The requirement in the above case is parties must address the court fully on the orders the court will make.
51. On the other hand, a cause of action filed in court is owned by the parties. The court is merely acting as a referee. Quite often the tendency is to go by the wishes of the parties if unilaterally consented prevails.
52. However, the deeper logic in the ratio can be upheaved in this manner. Only if a party in whose favour the decision-maker upholds, give consent to a consent judgment or order, that can be acceptable. By solely accepting the confession by the decision maker of his failure or his wrongdoings, or negative actions, and or mistake or carelessness, without obtaining the view of a party who the decision was in favour of, is completely a breach of natural justice or fairness.
53. I noted the Attorney General had accepted the content of the letter by the Deputy Registrar, admitting he de-registered PN: 197-010-262 on directive issued by the Minister, the late Hon. Onika. A process not provided for under the Land and Titles Act. And the Attorney General as representing the Minister had to accept by right of that wrong, hence weaken his case. Therefore had no choice, but to consent for judgment against himself. What about the party affected by the action of the Deputy Registrar under the directives.
54. The Claimant who had his eyes eager for any fault, capitalized on the statement of admission and run for Consent Judgment to end the case earlier. The Claimant can argue that the case against second and third Defendants are still not discontinued. That is pointless. Relief D which the Claimant sought under the Consent Judgment had automatically traversed the land registered in the name of the third Defendant be relinguished and re-registered in the name of the Claimant. Is that not depriving the third Defendant from being not given the opportunity to be heard before the land is taken away from it. I think that is a manifest of absolute injustice and unfairness at its best.
55. It would have been a proper option if the admission letter by the Deputy Registrar is attahed to a sworn statement given on behalf of the first and second Defendants in the original claim. And allow the substantive issue proceed to trial and let the court make a final judgment in the end.
56. With those discussions I have highlighted in this ruling, it is apparent this application must succeed.
    

Orders:

1. An order is hereby issued that the Consent Judgment between the Claimant and the second and third Defendants, perfected on 16^th June 2015, is hereby set aside.

2. Cost in the cause.

3. Case adjourn to 3^rd May 2018, 9:30am for mention.

The Court.

^[1] (2015) FJHC 856; HBC 78. 2015 (6 November2015).
^[2] Volume 3, 4 in Edition, paragraph 521.
^[3] 8 FLR 140 at P. 144.
^[4] 4 Edition, Vol 26, P.286, 287
^[5] (2007)SBCA 20; CA-CAC 35 of 2006 (1 November 2007).
^[6] (1993)PGLAW R, 543; (1993) PNGLR 405 (2 April 1993).
^[7] Ibid (6).
^[8] (2012)SBHC 20; HCSI-CC 223 of 2011 (27 February 2012)
^[9] (1007)SBHC 66; HCSI-CC 60 of 1997 (12 June 1997)
^[10] (2011) SBHC 49.
^[11] (Unreported) HCSI, Civil Case No. 42 of 2001, 28/8/2001.
^[12] (1897 2 Ch. 534.
^[13] [1999] FCA 557; (1999) 100 FCR 323 at (11)