Earlscroft University Ltd v Brown - [2003] SADC 39

Earlscroft University Ltd v George Brown
[2003] SADC 39
Judge Sulan
Civil

This is an application to vary an order made on the 1^st October 2002, by Judge Kelly sitting as a Master of this Court. It is necessary to set out some of the background leading up to Judge Kelly’s order and to this application.
The plaintiff, which is a company incorporated in the Republic of the Seychelles, instituted proceedings in this Court against the defendant alleging that he had defamed it. The plaintiff offered university degrees and it alleged that the defendant had defamed it in statements he had made which it alleged carried the imputations that the plaintiff was not a lawful institution, that it issued bogus and/or false degrees, that it engaged in fraudulent activity and that it operated illegally. The plaintiff sought damages for libel and injunctive relief.
On the 20^th February 2002, the defendant made application pursuant to Rule 100.01 of the District Court Rules (“the Rules”) seeking orders that the plaintiff provide security for costs. The basis of the application included an allegation that the plaintiff had no known assets within the jurisdiction of the Court. This fact was not contested.
On the 11^th April 2002, Master Norman made a consent order that the plaintiff pay into Court the sum of $23,000 as security for the defendant’s costs in the action and that payment be made within 28 days, failing which the plaintiff’s claim would be stayed.
No payment into Court was made, and on the 11^th September 2002, the defendant made a further application seeking orders that the plaintiff’s claim be struck out for want of prosecution and further, that the plaintiff and its solicitor, Mr Tom Doman, be restrained from transferring any monies placed by or on behalf of the plaintiff in Mr Doman’s trust account (in particular the $23,000 currently in this trust account) in relation to the action (save and except for in respect of Mr Doman’s legal fees) until after the payment of the defendant’s costs of the action.
This application came before Judge Kelly on the 1^st October 2002. His Honour made the following order :
“Unless the sum of $23,000 is paid into Court by way of security within 45 days, then this action do stand dismissed with an order for the costs of the action in favour of the defendant. The plaintiff’s solicitor has monies in his trust account but he cannot get instructions in relation to those monies. In the event that he does get those instructions, then the matter will proceed. In the event that he does not, then the defendant will be entitled to costs which are estimated at around about $4,000. It seems to me that it would be proper for me to make an order that the plaintiff’s solicitors retain in their trust account a sum of $4,000 pending further consideration and I will look at that question on the next occasion.”
The order…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2003] SADC 39
Decision Date: 7 March 2003

CaseChat Overview and Summary

Earlscroft University Ltd v George Brown is an application to vary an order made by Judge Kelly on October 1, 2002, which required the plaintiff, Earlscroft University Ltd, to pay $23,000 into court as security for the defendant's costs. The plaintiff, a Seychelles-based company, sued the defendant for defamation. The defendant sought security for costs and, after the plaintiff failed to pay the required sum, the defendant applied to have the plaintiff's claim dismissed and restrained the plaintiff from transferring funds in their solicitor's trust account. Judge Kelly dismissed the plaintiff's claim and ordered the solicitor to retain $4,000 from the trust account to cover the defendant's costs. The plaintiff now seeks to set aside the order restraining them from removing funds from the trust account.

The court had to determine whether the District Court had the jurisdiction to make the order restraining the plaintiff from removing funds from their solicitor's trust account and, if so, whether the order should be varied or set aside. The court examined Rule 84.12 of the District Court Rules, which allows the court to vary or set aside a judgment or order if the justice of the case so requires. The court also considered section 31 of the District Court Act 1991, which allows the court to make a restraining order to prevent a defendant from disposing of their property, and the inherent jurisdiction of the court to grant injunctions.

The court found that the District Court had the inherent jurisdiction to make orders of an injunctive nature, in addition to those orders that the court is empowered to make pursuant to the District Court Act and the Rules. The court also found that the order was necessary to prevent the plaintiff from frustrating the defendant's ability to enforce the costs order, which would result in manifest unfairness to the defendant. Therefore, the court varied the order of Judge Kelly and ordered that the plaintiff and their solicitor be restrained from transferring or otherwise dealing with the sum of $4,000 in the solicitor's trust account, which amount is to be reserved for payment of, or towards the defendant's costs of action in this matter.

The court made an order varying the order of Judge Kelly and ordering that the plaintiff and their solicitor be restrained from transferring or otherwise dealing with the sum of $4,000 in the solicitor's trust account, which amount is to be reserved for payment of, or towards the defendant's costs of action in this matter.

Orders