Appeals Court overrules decision

The Court of Appeal has overruled a Supreme Court judgement delivered by the former Chief Justice, Patu Falefatu Sapolu, on an insurance dispute which took 22 years to hand down after it was brought to trial. 

The Court found several problems with the initial Supreme Court ruling, especially its “intolerable” delay but also having been delivered in the absence of missing court files including written affidavits and transcripts. 

The Appeals Court was composed of the current Chief Justice, His Honour Satiu Simativa Perese, Justice Robert Llyod Fisher and Justice Sir Peter Blanchard, all of whom signed the overruling.

In a decision released on Wednesday, the Court headed its statement of reasons for its decision with reference to an old judicial saying: “Justice delayed is justice denied”. 

The Judges also made a “strong recommendation that the Government should consider meeting the costs of the appeal incurred by both parties” due to the considerable delays in finalising the matter. 

The case in question is between National Pacific Insurance Ltd (N.P.I.) and the Vaivaimuli Corporation Limited, which is located in Savai’i, and concerns a past insurance claim made by the latter decades ago.

The National Pacific Insurance Ltd company lodged an appeal against a decision of the Supreme Court on 26 August 2019, in which a judgement was handed down after 22 years in favour of the respondent to the sum of $245,000.  

The former Chief Justice heard the case over a two-day period and reserved his judgment on 30 April 1997.

Patu no longer occupied the position of Chief Justice after stepping down in April 2019. But he continued to hand down decisions as a temporary Supreme Court Judge in order to address a backlog of cases, including the insurance matter in question. 

According to the ruling, the N.P.I. argued that the judgment needed to be set aside as unsafe, either because of the extreme delay with which it was delivered or other circumstances surrounding it being handed down by the court. 

The Appeal Court said in its ruling that the facts of the case heard by Judge Patu were not complicated.

“Vaivaimuli had, in April 1986, insured its new building with N.P.I. against fire under policy terms which also covered it for certain ‘extraneous hazards’ [... including] cyclone damage,” the decision reads. 

“The annual premium paid by Vaivaimuli was $3072 for cover of $200,000 on the building, $25,000 on stock-in-trade and $25,000 for fixtures, fittings and equipment — a total of SAT$245,000.

“The policy was renewed in April 1987 but it was [the] N.P.I.’s case that at this time [that] it was no longer willing to cover extraneous hazards and that the premium which Vaivaimuli paid in that year and in the years beginning April 1988 and April 1989 was [consequently] reduced to $2827.50.

“Vaivaimuli was apparently aware that the premium had been reduced but its case was that it had never in any of the years 1987-1989 been informed that cover for extraneous hazards had been removed. lts witness, evidently gave an explanation that he believed Vaivaimuli was getting a discount for prompt payment of the premium.”

In 1990 Vaivaimuli was struck by Cyclone Ofa, one of the worst hurricanes to have affected the region in decades. It suffered as a result the destruction of its building and the total loss of other items relating to its business. 

Among the lost items was the insurance policy document held by Vaivaimuli. The company requested a copy of its policy. N.P.I. provided a copy which showed extraneous hazards marked as “deleted”. 

But Vaivaimuli made a claim under its policy for the cyclone damage, which was subsequently denied by N.P.I. 

“Supreme Court proceedings were issued by Vaivaimuli in October 1991 but they did not come to trial until April 1997,” the Appeal Court Judges wrote. 

By 2019, the Court file related to the case had gone missing. It has never been located.

“As a result, none of the affidavits, witness statements or exhibits were available to [Patu] when he began to prepare his judgment in August 2019. There was also no trial transcript available to him,” the Appeal Court decision states. 

The Appeal Court ultimately made its finding in favour of the insurer despite recognising the long struggle for justice faced by the company.

“The judgment obviously is unsafe. We have the greatest sympathy for Mrs. Ruby Drake and her client [Vaivaimuli] for having suffered from this intolerable delay. Mrs. Drake had battled valiantly to extract a judgment. She had done everything she could do for her client. But, as we made plain during the oral hearing, we cannot allow the judgment to stand.

“The extreme delay alone would require that, especially in a factual matter turning on the credibility of witnesses, even if all the written materials necessary for the Judge’s assessment were still available. But almost everything had after 22 years been lost. 

“Furthermore, the judgment itself, in particular the way in which the evidence is assessed and conclusions reached without any analysis at all, is very superficial. It does not withstand a moment’s scrutiny, let alone the  ‘anxious scrutiny’ recommended by the Privy Council. To allow this judgment to stand would be unfair to N.P.I.”

The Appeals Court noted that without a Court file, to attempt to remember a trial from so long ago, Judge Patu must have been particularly handicapped by the absence of defence affidavits and witness statements. There was, for example, nothing at all available about one of N.P.l.’s key witnesses who did not give oral evidence and whose statement had gone missing.

“The judgment for Vaivaimuli must accordingly be set aside. It follows that its cross-appeal seeking interest must fail,” the court said. 

“Clearly it would not be appropriate to order a retrial when the Court has no file and, even if witnesses are still available, their memory of events in 1986-90 is likely to be unreliable. The case cannot fairly be revived.

“The consequence, however, will be that Vaivaimuli will never be able to bring to finality its claim against N.P.I., whatever the strengths or weaknesses of that claim. It has lost the chance of a successful outcome through no fault of its own.”

The Judges noted that while they are not aware of any problem of delay in giving judgment by any other Supreme Court Judge, it is nonetheless desirable that the Court should as soon as possible develop a protocol for the timely delivery of judgements. 

“The N.P.I. does not seek costs in the Supreme Court but asks for an award in respect of this appeal. In [... normal circumstances] we would make an award to a successful party. N.P.I. says that Vaivaimuli should have recognised the obvious inadequacies of the judgment and should not have opposed the appeal or filed its cross-appeal," their ruling said. 

“Those points are well made but Vaivaimuli bears no blame for the delay and has not acted improperly in relation to the appeal.

“Its cross-appeal has taken up very little of the time of the respondent's counsel or the Court. ln the very unusual circumstances, we consider that the interests of justice are best served, if as between the parties, costs are let to lie where they fall.

“We do, however, draw the attention of the Attorney General to this judgment with the strong recommendation that the Government should consider meeting the costs of the appeal incurred by both parties on a solicitor and client basis. We direct the Registrar to transmit a copy of this judgment to the Attorney.”

The Judgement of the Supreme Court was set aside.