Supreme Court Judgement: Aminath Naazly v Seagate The International Pvt Ltd

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Summary

An appeal where the Supreme Court considered when new evidence can be adduced during the appeal at the Supreme Court. The Court established the criteria that needs to be met before leave to adduce new evidence on an appeal can be granted.1

 
Factual Background

  1. Aminath Naazly and 3 others (Naazly and others) contracted with Seagate The International Private Limited (Seagate) on 5 September 2005 for the construction of a foundation and 3 floors of M. Oping Sun. The project was to be completed within 270 days.
  2. A letter was sent to Seagate on 31 January 2006 by Naazly and others for the termination of the project before full completion.
  3. The total contracting amount for the project was MVR 860,512.00, out of which MVR 699,106.00 was paid.
  4. Clause 12(b) of the contract stipulates that Naazly and others can terminate the contract after paying MVR 50,000 in damages to Seagate and Clause 16(a) of the contract provides that the possession of the building will remain with Seagate until all payments have been duly paid to the Seagate.

 
Procedural History

  1. Seagate brought an action against Naazly and others in the Civil Court claiming for the remaining MVR 161,406.00, the MVR 50,000 under Clause 12(b) of the contract and for the possession of the building.
  2. On 18 October 2009, the Civil Court held that the claim Seagate had against Naazly and others was not sufficiently established. The Court noted that the amount for the construction of the foundation was agreed by the parties under the “Drawdown Schedule”. This amount was handed over to Seagate by the Housing Development Finance Corporation (HDFC). The Civil Court held that unless otherwise proven, there is no room to suggest that the defendants owed Seagate any additional money for the construction of the foundation other than what was agreed in the Drawdown Schedule.
  3. Seagate appealed the decision at the High Court2. High Court dismissed Seagate’s claim regarding the MVR 50,000 under Clause 12(b) highlighting that Clause 12(c) allows the termination of the contract if the quality of the work was unsatisfactory.
  4. High Court also dismissed Seagate’s claims for the possession of the building. The justices of the High Court were of the opinion that Clause 16 of the agreement was crafted with the intention that it will be used after the completion of the project and since the agreement was terminated before completion, there is no reason to hand over the possession of the building to Seagate.
  5. Regarding the MVR 161,406.00, the High Court noted that according to the agreed Drawdown Schedule, Naazly and others had agreed to settle the amounts as own expenses and by a loan facility from HDFC. As there was no evidence that Naazly and others had paid such payments due as own expenses, the High Court ordered Naazly and others to pay the amounts to Seagate.
  6. Naazly appealed the High Court’s decision arguing that the High Court erred in its decision and applied to introduce new evidence that was obtained from HDFC after the High Court’s decision. The justification provided by Naazly was that the fresh evidence would have a direct influence on the decision of the Supreme Court, claiming that the evidence would make it apparent that the High Court’s decision will not stand.

 
Legal Issue

Under what circumstances will leave to adduce new evidence on an appeal at the Supreme Court be granted.

 
Holding(s)

Unanimously dismissing the appeal, the Supreme Court held that the new evidence introduced by Naazly fails to meet the criterions of:

  1. Non-availability as the document existed during the lower court process; and
  2. Credibility as the appellant failed to establish the credibility of the document despite the credibility being contested by the respondent.

Reasoning(s)

  1. The general principle is that new evidence cannot be submitted during the appeal in the Supreme Court. However, due to the importance of the new evidence and the result that may occur due to rejection of such evidence, the court may grant leave to submit the new evidence.
  2. The following criteria must be established before new evidence is to be allowed on an appeal under exceptional circumstances:
    • Non availability of the evidence during the trials in the lower court despite reasonable efforts undertaken to make it available.
    • Relevance of the evidence in influencing the substance of the decision. The evidence need not change the decision of the court.
    • There should not be any questions on the credibility of the evidence.
  3. Under the law, first instance courts are conferred with the power to conduct full trials, establish facts and decide on the application of the law. If the decision at first instance is appealed at the High Court, unless exceptional circumstances are established, the appellate court will decide the appealed case based on the evidence and defences submitted in the lower courts.3 As for introducing new evidence on appeal, Section 32(b) of the Judicature Act4 provides that new evidence can be submitted on appeal if no opportunity was given to submit them during the earlier trial.
  4. Despite the clear provisions in the Judicature Act on the circumstances in which new evidence can be submitted during an appeal at the High Court, the Act is silent on submitting new evidence on an appeal at the Supreme Court. This further reiterates the principle that introduction of new evidence is limited to exceptional circumstances. This principle has also been recently upheld at the Supreme Court in Moosa Naseer v MIRA.5
  5. The Supreme Court also noted that the Court has wide powers conferred to it by the Judicature Act. However, the application of the powers varies in degree and proportion in cases before the Court. This is evident from the hierarchy of the courts system and the jurisdiction given to each court under the Judicature Act, Further, the Judicature Act lays down the limited circumstances under which an appeal can be submitted to the Supreme Court. Hence, the circumstances on which judgments can be appealed are restricted.
  6. The Court reasoned that the purpose of the limitations on submitting new evidence during appellate stage is to ensure certainty in the first instance decisions and to find an expeditious conclusion to the dispute. The Court further highlighted that allowing new evidence during appeal would render the lower court trials ineffective and the parties may act without proper care to the lower court proceedings.
References

1 2013/SC-A/20.
2 2010/HC-A/44.
3 Section 32(a) of the Judicature Act (Law Number 22/2010).
4 Law Number 22/2010.
5 2015/SC-A/41.