Cash Plus (Pty) Ltd v Ruju Paunikar trading as the Standard Traders (CS 42/2021)  SCSC 39 (24 January 2022);
Ruling– Plea in limine litis – Section 295 of the Seychelles Code of Civil Procedure (Cap 213)
- This Ruling arises as a result of the statement of defence of the Raju Paunikar trading as The Standard Traders (Defendant) in answer to the plaint filed by Cash Plus (Pty) Ltd of the 6 May 2021 (“Plaintiff”).
- The Defendant in his statement of defence raises a plea in liminie litis to the effect that the plaint is bad in law and must be dismissed, for being afoul to the provisions contained in section 295 of the Seychelles Code of Civil Procedure (“the code”). Prescribing for all actions pertaining to a bill of exchange or promissory notes.
Background of the pleadings
- In terms of the plaint filed on 6th May 2021, it was claimed that at all material times the Plaintiff was a company registered under the Companies Act 1972 and licensed under the Financial Institutions Act to carry out the business of a bureau de change, and the Defendant was a client of the Plaintiff.
- It is averred that in 2018, the Defendant purchased foreign currencies from the Plaintiff for a value of SCR 729,068.00. The Defendant left a series of Barclays Bank cheques with the Plaintiff as post payments for the said currencies.
- The said cheques were never honoured and as a result, the Defendant still owes the sum of SCR 729,068/- to the Plaintiff.
- Despite demands from the Plaintiff, the Defendant has failed and refused to pay the said sum of SCR 729,068/- to the Plaintiff.
- The Plaintiff further avers that the transaction was a commercial transaction.
- The Plaintiff prays for a judgment in the sum SCR 729,068/- with cost and interest at the commercial rate currently standing at a base rate of 11% per annum.
- The Defendant in his statement of defence, on the other hand, denies the legal status of the Plaintiff and puts the Plaintiff to strict proof thereof. Despite admitting that the Defendant purchased foreign currencies from the Plaintiff by way of post payments of cheques to the Plaintiff, the Defendant further avers that payment of foreign currency was agreed by post-payment of cheques to the Plaintiff, it was further agreed between the parties that the Plaintiff was only to post the cheques upon the express authorization of the Defendant, who would alert Plaintiff of funds into the Defendant’s bank account, to honour the post-payment cheques. That the Plaintiff ventured to cash the post-payment cheques without the express permission of the Defendant as agreed, thus the dishonouring the said cheques, is denied as well as the alleged refusal to repay back the said foreign exchange and the commercial nature of the transaction between the parties. In the end result, the Defendant claims that the plaint should be dismissed with costs.
- The Defendant also raised two pleas in limine litis in its defence namely that: (i) the action is bad in law and must be dismissed for being afoul to the provisions contained in Section 295 of the Code, prescribing for all actions pertaining to a bill of exchange or promissory notes; and (ii) the action is time-barred for purposes of the Code.
Legal analysis and findings
- I will now move on to address the legal standards applicable in this case in light of the highlighted salient facts ex-facie the pleadings.
- Section 295 of the Civil Procedure Code provides that:
“All actions upon bills of exchange or promissory notes commenced within six months after the same shall have become due and payable may be by writ of summons in the special form contained in Schedule D, and indorsed as therein mentioned, and it shall be lawful for the plaintiff, on due proof of personal service of such writ within the jurisdiction of the court, or an order for leave to proceed, and a copy of the writ of summons and the endorsements thereon, in case the defendant shall not have obtained leave to appear and have not appeared to such writ according to the exigency thereof, at once to sign final judgment in the form contained in Schedule E, for any sum not exceeding the sum endorsed on the writ, together with the interest at the rate specified(if not exceeding the legal rate of interest) or if none be specified, the rate of interest allowed by law in such cases to the date of the judgment, and a sum for costs to be fixed by the court, unless the plaintiff claim more than such fixed sum, in which case the costs shall be taxed in the ordinary way, and the plaintiff may, upon such judgment, issue execution forthwith.”
- In his written submission filed on 22nd September 2021, in reply to the first plea in limine litis, Counsel Ferley for the Plaintiff submitted that section 295 provides for a summary procedure for enforcement of promissory notes and bills of exchange to the Plaintiff who chooses to follow the procedure for faster relief. It does not mean that for every case where a promissory note or bill of exchange is involved, it is mandatory to bring a proceeding under section 295.
- It is further submitted that the Plaintiff’s claim is based on a breach of agreement resulting from the failure to pay a debt owed by the Defendant to the Plaintiff. The plaintiff sues based on the debt owed to it by the Defendant in a contract. The Plaintiff, therefore, has the benefit of the general prescription period of 5 years for bringing its case.
- Plaintiff submits, hence, that it has properly commenced its action in compliance with section 23 of the SCCP and moves for dismissal of both pleas in limine.
- In his written submission on the first plea in limine litis, Counsel Camille for the Defendant submitted that Section 295 of the Code prescribes special provisions for summary procedures on all matters relating to bills of exchange, such as cheques. Hence, it states that all actions upon bills of exchange or promissory notes within 6 months after the same shall have become due, has to be by way of a writ of summons in the special form prescribed in schedule D of the Code.
- Counsel for the Defendant relied on the case of D’Offay vs D’Offay (1992) LSC22, [reported at page 290 Seychelles Digest 2014], where it was held that a judge should examine a plaint and discover whether, by nature, it is a matter for which a special procedure is provided in the Code of Civil Procedure or whether it is a matter properly tried by an ordinary plaint.
- It is submitted that whenever the Code provides for a special procedure to try the matter, the action cannot be prosecuted by way of an ordinary plaint. It is submitted further that in the instance of this case, the Plaintiff cannot institute the cause of action by way of plaint but may only do so under the provisions of Section 295. For these reasons, the plaint must be dismissed.
- In his submission on the second plea in limine litis, Counsel for the Defendant submitted that the action is time-barred for purposes of section 295 which makes it mandatory for all actions of writs of summon upon bills of exchange to be commenced within 6 months from the date from which such bills become due and payable. The Plaintiff is alleging cheques issued in 2018 and the Plaint itself was filed on 10 September 2020. Therefore, the Defendant moves the Court to dismiss the plaint.
- Having duly scrutinized the pleadings filed in this case; the submissions of counsels in light of the relevant legal provisions the following are the court’s findings.
- Section 295 of the Code provides for a summary procedure for enforcement of promissory notes and bills of exchange to a Plaintiff who chooses to follow the procedure for faster relief.
- Summary procedures are generally much easier to establish for the Plaintiff and much tougher for the Defendant to defend than ordinary suits. This is because of the fact that the Defendant has an added burden of proving why he should be allowed to put up a defence.
- One resounding difference between the two suits is that whereas an ordinary civil suit can be filed for any civil wrong, a summary suit is limited to money claims only relating to negotiable instruments, recovery of loans, written contracts, etc. Therefore, the scope of a summary suit is narrow as compared to the scope of an ordinary suit.
- Under section 295 of the Seychelles Code of Civil Procedure, a person suing on a negotiable instrument has an option to bring his suit in the ordinary form or under the summary procedure as he chooses best. The rules though are peremptory, and in reality only directory, and not mandatory.
- Section 295 of the Seychelles Code of Civil Procedure provides an option to bring such a suit either in the summary form or in the ordinary form. The section states that:
“all actions upon bills of exchange and promissory notes commenced within six months after same shall have become due and payable may be by writ of summons in the special form contained in schedule D…”.
- (Commenced within six months) and (maybe by writ of summons) are the words giving the option and cannot be substituted for the word "shall." There can be no clearer indication than that of the intention behind that legal provision which is namely, to avoid the rigid rule requiring all suits on negotiable instruments to be brought in a summary manner. Thus, the very object of section 295 of the Code will be defeated if we are to hold that albeit in its language there is still no option left to a Plaintiff suing on a negotiable instrument to bring his suit in the ordinary form.
- Noting that summary procedures could be the preferred option whenever the circumstances allow for a speedy recovery of debts arising out of bills of exchange or promissory notes as compared to an ordinary suit, the first plea in limine litis is dismissed in light of the above analysis.
- It follows as a result, that the second plea in limine litis as raised by the Defendant is also dismissed.
- The action is time not barred for the purposes of Section 295 of the Seychelles Code of Civil Procedure. The Plaintiff has properly commenced its action based on a breach of agreement resulting from the failure to pay a debt owed by the Defendant to the Plaintiff. Since it is a suit instituted by the filing of an ordinary plaint as per section 23 of the SCCP, the Plaintiff has the benefit of the general prescription period of 5 years.
- Following the above analysis, the matter is to proceed to the hearing on the merits as against the Defendant.
Signed, dated, and delivered at Ile du Port Victoria on24 January 2022.