Saint Lucia Furnishings Ltd Appellant v [1] Saint Lucia Co-operative Bank Ltd [2] Frank Myers of KPMG Respondents [ECSC]

• Jurisdiction: St Lucia
• Judge: BYRON, C.J.,Chief Justice,Justice of Appeal,Sir Dennis Byron,Albert Redhead,Brian Alleyne, SC
• Judgment Date: 24 November 2003
• Judgment citation (vLex): [2003] ECSC J1124-1
• Court: Court of Appeal (Saint Lucia)
• Docket Number: CIVIL APPEAL NO.15 OF 2003
• Date: 24 November 2003

[2003] ECSC J1124-1

IN THE COURT OF APPEAL

Before:

The Hon. Sir Dennis Byron Chief Justice

The Hon. Mr. Albert Redhead Justice of Appeal

The Hon. Mr. Brian Alleyne, SC Justice of Appeal

CIVIL APPEAL NO.15 OF 2003

Between:

Saint Lucia Furnishings Limited

Appellant

and

[1] Saint Lucia Co-operative Bank Limited

[2] Frank Myers of KPMG

Respondents

Appearances:

Mr. Kenneth Foster, Q.C. for the Appellant

Mrs. Brenda Flossaic-Flemming; Ms. Shan Greer with her for the first Respondent

Mr. Kenneth Monplaisir, Q.C. for the second Respondent

BYRON, C.J.

1 This is an appeal against an order by the Master dated 6^th day of May 2003 striking out the statement of case and dismissing the Claim of the Appellant, St. Lucia Furnishings, for non compliance with the rule requiring the attendance of the litigant and its legal representative at Case Management Conference, and ordering that judgment be entered in the amount of $394,043.56 together with interest, in favour of the St. Lucia Co-operative Bank [the Co-op Bank] on its counterclaim for failing to file and serve a defence to the counterclaim.

The Pleadings

2 On 12^th September 2002, St. Lucia Furnishings filed proceedings claiming compensation for trespass committed by Mr. Myers, acting as Receiver appointed by the Co-op Bank. It alleged that Mr. Myers entered its premises and took possession of its assets to enforce collection of moneys alleged to be owing on a mortgage debt. It alleged that the loan had been repaid, that the actions of the Co-op Bank and Mr. Myers were wrongful and had caused substantial losses. Both Myers and the Co-op Bank filed defences denying liability.

3 The Co-op Bank counterclaimed for the sum of $394,043.56 and interest, owing on a loan it made to St. Lucia Furnishings secured by a Second Hypothecary Obligation (Mortgage Debenture and Floating Charge) executed and registered in the Land Registry on 13^th May 1999. It alleged that St. Lucia Furnishings neglected to make repayments despite demands. It asserted that it appointed Mr. Myers pursuant to the powers contained in the Hypothecary Obligation. It specifically denied that the loan was repaid. This counterclaim was filed and served on 15^th November 2002

4 Since that date St. Lucia Furnishings did not file any other documents in the case. There was absolutely no rebuttal of the allegations in the defences of the Co-op Bank and Mr. Myers and no denial of liability for the amount claimed in the counterclaim.

The Hearings

5 The Court summoned a Case Management Conference for the 9^th day of April 2003. Neither St. Lucia Furnishings nor its legal representative attended. The Court adjourned the matter to the 6^th May 2003. There was no appearance by and on behalf of St. Lucia Furnishings this second occasion.

6 The Master exercised the powers conferred by CPR Part 26.3 (1)(a) of the Rules of Procedure to strike out the statement of case filed by St. Lucia Furnishings. He dismissed its actions and ordered that judgment be entered on the counterclaim brought by the Bank.

Procedural Problems

7 Counsel for the Co-op Bank rightly submitted that an appeal was not the appropriate process for the Appellant to obtain relief in these circumstances. The proper recourse was to apply to the High Court to set aside the judgment. The application must be made promptly and be accompanied by affidavit containing proof of reasons for the absent party's failure to attend the Case Management Conference1. Counsel pointed out that the position with the default judgment is similar. The rules require the defaulting party to apply to the High Court to set aside the default judgment. The defaulting party is required to satisfy the Court by affidavit that there is a good explanation for his failure to file the defence and that he has a real prospect of successfully defending the claim or counterclaim.2

8 The parties were already before us and we decided to consider the appeal. In the event that the Master had applied wrong principles or made errors of law it would have been appropriate to adjudicate. There was the risk of being affected by the handicap that the appeal process permits the defaulting party to circumvent the requirement to file affidavit evidence of the reason for the default, which is an important factor to be considered in the exercise of discretion to set aside the orders. In this case that did not prove to be the determining factor.

The Opportunity to attend Court

9 Counsel for the Appellant made a passionate oration on the rights of the litigant. He submitted that his clients were prejudiced by not having an opportunity to have

their matter heard in their presence and that dealing with matters in their absence was a serious injustice. Despite the passion, when it was time to consider the substance of the matter there was no evidence to establish that the proceedings were heard without appropriate notice having been given nor that there was a reason for non attendance.

10 One of the important aspects of the new culture of litigation in the new civil procedure rules is the provision that litigants should attend all proceedings with their legal representatives. Their attendance is a duty imposed by CPR Part 27.4. This rule is for the benefit of litigants. It is intended to respond to the complaint that litigants do not get information about their cases, and are not sufficiently involved in the conduct of their litigation. I would think that it would have been more accurate to say that St. Lucia Furnishings did not avail themselves of the opportunity to be heard rather than that they did not have an opportunity to be heard. The sanction is intended to remedy another complaint of litigants; delay in the completion of litigation. Repeated adjournments, caused by non-compliance of one side with the Rules of Court, is denial of justice to the other side. The adage is still true that justice delayed is justice denied.

The Exercise of Discretion

11 The main concept in the overriding objective of the new rules set out in CPR Part 1.1, is the mandate to deal with cases justly. Shutting a litigant out through a technical breach of the rules will not always be consistent with this, because the Civil Courts are established primarily for deciding cases on their merits, not in rejecting them through procedural default. The flexible approach that should be adopted by the Court was discussed in the case ofBiguzzi v Rank Leisure (1999) 1 WLR 19263. The Court has wide powers for imposing appropriate sanctions. It is therefore possible to formulate suitable sanctions for breach of rules and directions without immediately resorting to draconian responses such as striking out. I particularly

mention the provisions relating to "unless orders" which are intended to be used as a preliminary step to the imposition of sanctions.4

12 There will be situations, however, where striking out without the intermediate step is an appropriate order. There are two relevant concepts in the overriding objective. One is saving the litigant's expense and the other allotting an appropriate share of the Court's resources. The ultimate solution would, therefore, be a proper exercise of discretion where failure to strike out would cause a waste of expenses and resources. This means that repeated non-compliance with a rule or non-compliance combined with a weak case would justify the striking out of the case....