DARAMY v NATIONAL TELECOMMUNICATIONS COMMISSION (CC 142/08)  SLHC 13 (01 November 2008);
CC 142/08 2008 D No 5
IN THE HIGH COURT OF SIERRA LEONE (COMMERCIAL AND ADMIRALTY JURISDICTION) BETWEEN: ALHAJI KANJI KEMOH S. DARAMY 24 PENINSULA RD GODERICH
NATIONAL TELECOMMUNICATIONS COMMISSION HILL STATION, FREETOWN
J B JENKINS-JOHNSTON SOLICITOR FOR DEFENDANT/APPLICANT CHARLES F. MARGAI SOLICITOR FOR PLAINTIFF/RESPONDENT
RULING DELIVERED THIS DAY OF NOVEMBER 2008 BY THE HON MR.
JUSTICE E. E. ROBERTS
By Notice of Motion dated 22nd October, 2008 the Defendants/Applicants herein prayed for inter alia an order setting aside judgment in default of defence dated 17th October 2008 on the ground that the Defendants have a good defence on the merits to the action, and that leave be granted to the Defendant to defend the action by filing a defence and counter claim.
In support of the application the Defendants/Applicants relied on the affidavit of Sulaiman Banja Tejan-Sie sworn to on the 22nd October 2008 together with the various exhibits there attached.
In opposing the application the Plaintiff/Respondent filed and relied on the affidavit of Robert B. Kowa sworn to on the 24th October 2008 together with the exhibits attached thereto.
In this matter a writ of summons issued on 8th September 2008 was apparently served on the Defendants who due to some "mix up" caused two appearances to be entered on their behalf. According to the Defendants, this mix up was regularized by the filing of a change of solicitors duly appointing Jenkins Johnston and Co. as the new solicitors. In any event after entry of the
appearance on behalf of the defendant the first of which was sealed on the 19th of September 2008, the Defendants failed and or neglected to file a defence within the time prescribed by the rules, and the Plaintiff on the 17th October 2008 duly proceeded to enter judgment in default of defence. On the 22nd October 2008 the Defendant/applicant filed this application praying for a stay of execution of the judgment as well as for an order setting aside same as according to them there is a good defence on the merits.
The Defendant/Applicants accept that the judgment was regularly obtained. I must state at this stage that where a regular judgment has been entered against a defendant in default of defence, that Defendant may apply pursuant to the provisions of order 22 Rule 11 of the High Court Rules 2007 to have the said judgment set aside. On such applications the proper approach for the court to follow is as laid down by the House of Lords in the case of EVANS Vs BARTLAM (1937) 2 ALL ER 646. The general issues to be considered (as stated in EVANS V BARTLAM) were succinctly summarized by Sir Roger Ormrod in ALPINE BULK TRANSPORT CO. INC Vs SAUDI EAGLE SHIPPING CO. INC
"The Saudi Eagle" (1986) 2 LLOYDS Rep 22. This was what Roger Ormrod had to say at page 223.
The following "general indication to help the court in exercising the discretion " (per Lord Wright at p.488) can be extracted from the speeches in Evans V. Bartlam, (1937) A.C. 473, bearing in mind that "in matters of discretion no one case can be authority for another" (ibid. P. 488):
(i) a judgment signed in default is a regular judgment from which, subject to (ii) below the plaintiff derives rights of property;
(ii) the Rules of court give to the Judge a discretionary power to set aside the default judgment which is in terms "unconditional" and the Court should not "lay down rigid rules which deprive it of jurisdiction " (per LordAtkin at p. 486)
(iii) The purpose of this discretionary power is to avoid the injustice which might be caused if judgment followed automatically on default;
(iv) The primary consideration is whether the defendant "has merits to which the Court should pay heed" (per Lord Wright at p. 489), not as a rule of law but as a matter of common sense, since there is no point in setting aside a judgment if the defendant has no defence and if he has shown "merit" the............... Court will not, prima facie, desire to let a judgment pass on which there has been no proper adjudication, (ibid. p. 489 ad per Lord Russell of Killowen at p. 482).
(v) Again as a matter of common sense, though not making it a condition precedent the court will take into account the explanation as to how it came about that the defendant -...............found himself bound by a judgment regularly obtained to which he could have set up some serious defence (per Lord Russell of Killowen at p. 482). It is indeed observed that the above passage as admitted by Sir Roger Ormrod , provides mere guidelines as the Court has always had an unfettered discretion in deciding whether or not to set aside a default judgment regularly obtained. The general purpose of the discretion of the court is to do justice and to avoid the injustice which may perhaps be caused if "Judgment followed automatically on default"
I shall firstly, very briefly, deal with the issue of delay on the part of the Defendant/applicant. As quietly rightly observed by counsel for the Plaintiff/Respondent there are two separate types or categories of delay to be explained by the Defendant/Applicant. Firstt is the delay (or default) in allowing judgment to be entered and second is the delay in coming to court to apply for the judgment to be set aside. It is my view that both delays would have to be explained.
In the instant case there was no delay it would seem between the date of the judgment and the application to set it aside as the judgment was entered on the 17th of October and barely 5 days later, the Defendant filed this application applying for it to be set it aside. As for the delay in allowing judgment to be
entered in default, the explanation proffered by the Defendant/Applicant is contained in paragraphs 2 to 5 of the affidavit of Sulaiman Banja Tejan-Sie sworn to on the 22nd October 2008. This explanation leaves so much to be desired that the least said about it the better. Suffice it to say however that much as I will take into account this explanation for what it is worth, its is not the deciding factor or a condition precedent to my granting or refusing the present application before me. Indeed in the case of VANN V AWFORD (1986) 130 SJ 682 CA, the court held that even though the defendant had put forward a wholly dishonest explanation for his delay or failure to give notice of intention to defend, yet the default judgment must be set aside as the defendant had a good defence. See also the dictum of Lord Atkin in Evans Vs Bartlam 1937 2 All ER 647 at page 650 paragraph A to D.
Indeed the primary consideration in this kind of application in whether the defendant/applicant has shown a good defence on the merits; as it would perhaps not serve any useful purpose to set aside a regular judgment where the defendant has no defence.
I shall now proceed to consider the defence of the defendant/applicant as contained in the exhibits attached to affidavit in support, particularly the proposed defence and counterclaim. Before doing so however I wish to briefly deal with a contention by the Plaintiff/Respondent which I believe raises an interesting point worthy of consideration at this stage. It was submitted by counsel for the Plain tiff/Respondent that a legal opinion was given by the Law Officers Department which emanated as a result of the Defendant's letter dated 12th November, 2007 marked RBK 2-4 annexed to the affidavit of Robert B. Kowa filed in opposition herein. Counsel contends that the opinion which appear to admit or accept the Plaintiff's claim is more in line with the law that the Defendant's contentions in exhibit C.
Even though counsel did not submit as much, I must state that the fact that the Law Office appears to concede to the Plaintiff's claim does not without more confirm that the defendant has no defence. For one the opinion may be erroneous. Again one has to consider whether it Was given by or an behalf of the Defendant. The primary consideration in my view is whether the defendants in fact have a good defence notwithstanding any apparent concession or admission ort acceptance by or on behalf of the Defendant or by persons working under his instructions or at his request as the case may be.
In the case of Evans Vs Bartlam the Defendant after allowing default judgment to be entered and with knowledge of the judgment applied for, (with the consent of the plaintiff) time for the matter to stand over for him to arrange how he could pay and in effect comply with the judgment. The House of Lord nonetheless allowed him to subsequently contest the judgment and succeed in setting it aside Lord Atkin had this to say at page 649:
"For my parti am not prepared to accept the view that there is in law any presumption that anyone, even a judge, knows all the rules and orders of the Supreme Court. "
In that case the acceptance of approbation by the defendant was never held against him.
In the instant case therefore I must keep an open mind on the issue before me as the Law Officer may be wrong and ought not to be taken to know all the law. I must therefore consider his opinion, the Plaintiff's case as well as the defendant's defence and counterclaim to see whether indeed the defendant has a good defence on the merits to his action.
The Plaintiff's claim in summary is that by letter dated 18th October 2008 he was appointed by the president as chairman/commissioner of the National Telecommunications Commission for a fixed term of three years effective from the 3rd October 2006 on the terms and conditions contained in the said letter. That before the expiration of the fixed term and with the plain tiff having served only 12 months of his contract, he was relieved of his duties as commissioner in the said commission by letter dated 9th November 2007. The Defendant sought advice inter alia as to the source from which the Plaintiff's terminal benefit would be paid. This precipitated a legal opinion written by a Law Officer which said opinion suggested that the plaintiff be paid for the full ( unexpired) term of his fixed contract. The plaintiff demanded the payment of his full salary for the unexpired term of his contract but the defendants have failed to pay him.
The defendants contention is that notwithstanding the appointment of the plaintiff by the President for a term of 5 years it was not a fixed term and that the plaintiff ought not to be paid salary for the unexpired term, a period for which he has not worked as this would amount to a misapplication of public funds, and that the plaintiff has been offered three (3) months salary in lieu of notice plus leave pay for 45 days vacation.
Has the defendant shown a defence raising triable issues? And what standard should the court employ in assessing the nature of the defence? In the Saudi Eagle, the Court of Appeal held that the defence raised should have a real prospect of success. However it was subsequently
held by again the Court of Appeal in DAY V RAC MOTORING SERVICES LTD 1999 1 All ER 1007 that this standard or test in the Saudi Eagles was perhaps too rigorous, whilst agreeing that the arguable case must carry some degree of conviction.
It is my view that the defence proffered by the defendants in this case raises an arguable case which carries some conviction sufficient for me to hold that it would only be fair for the judgment to be set aside and the matter tried on the merit. It is also my view that even applying the higher test in the Saudi Eagles the defence has some prospect of success if not for any other reason but for the fact that the defendants might succeed in perhaps reducing the quantum claimed by the plaintiff as contained in the judgment. Indeed it is not clear to me at this stage whether the defendant is entitled to the sum claimed which was calculated by him as his salary for the unexpired term of the contract. I note that the plaintiff did not claim for unlawful or wrongful termination.
Perhaps he may argue that the defendants repudiated the contract and he merely accepted it and is insisting on payment of his benefits. It is not for me to speculate on all there submissions, suffice it to say that whilst they may not be a dispute as to the fact that the plaintiff is entitled to some sum, it is indeed arguable as to what amount he is actually entitled to recover. In the case of VANN VAWFORD cited earlier, the possibility of the defendant succeeding in reducing the amount of damages awarded in default weighed in the justices' mind in setting aside the default order.
Also the nature of the contract between the plaintiff and the defendants is another contentious issue. Counsel for the plaintiff relied on the case of OLANIYAN VS UNILAG.(2004) 15 WRN 44This case no doubt would be extremely useful in dealing with the issues raised in the present case. One issue however which it does not answer (or resolve), and which arises in this case is whether the plaintiff is entitled to the total salary he would have received for the unexpired term of the contract. What I understand from this case in this regard is that in situations where a person's contract is terminated (on repudiated as the case may be) in circumstances such as this case i.e. where the plaintiff is suggesting that the provisions of the act were not followed, then he may elected whether to reject the termination as unlawful or accept it and sue for damages. These comments appear to have been part of the dictum of the justices in the OLANIYAN case. [See also the case of GUTON Vs LONDON BOROUGH OF RICHMOND UPON THAMES (1980) 3 ALL ER 577]
The main issue in the OLANIYAN case, however, appears to be the legality or otherwise of the termination of the services of the appellants.
I note that the defendants in their counterclaim are seeking a declaration that the Plaintiff's appointment was determined by the president under section 5 of the National Telecommunications Act No. 9 of 2006 and was therefore not a fixed term contract but one held at the pleasure of the President. This is an issue dealt with in the OLANIYA N case. This declaration sought may or may not necessarily affect the quantum of the amount recoverable by the plaintiff and/or how the same may be calculated.
These are all serious issues that fortified my view that the defendants have raised an arguable case carrying some degree of conviction.
In the light of the above, whilst punishing the defendants in costs for allowing judgment to be entered in default, I shall however permit them to come and defend the action on the merits and I believe in all the circumstances of this case that it is the just thing to do. I therefore make the following orders:
1. The judgment in default of defence herein dated 17th October 2008 is hereby set aside.
2. The defendants shall within three days of this Order file and serve on the Plaintiff their defence and counterclaim.
3. The cost of this application assessed at Le 2million shall be borne by the Defendants.
HON MR JUSTICE E. E. ROBERTS