The Prime Minister Hon ‘Akilisi Pohiva and the Public Service Association won their appeal against an initial court order to pay $20,000 each of security costs before their civil action against Tongasat can proceed.

The appellants can now proceed with their civil action without having to first pay security costs.

On 16 September, the Appeal Court allowed the appeal after finding Mr Justice Scott’s exercise of discretion in relation to both appellants was in error.

“We grant leave to appeal. The appeal is allowed and the order for costs is set aside.”

The appeal as brought by PSC and Pohiva against first and second respondents Kingdom of Tonga and Friendly Islands Satellite Communications Ltd. (Tongasat).

This was an application for leave to appeal against an order made by Mr Justice Scott on March 19, 2015 in the Supreme Court requiring the plaintiffs/appellants to pay the registrar $20,000 each by way of security for costs. The order is to stay the appellants proceeding against the Kingdom of Tonga and Tongasat until the security is provided.

This arose out of proceedings started on July 8, 2014 brought by PSA and Pohiva questioning a payment of US$25,450,000 said to have been made by the Government of Tonga to Tongasat around June 2011 after Government had received an aid grant in that amount from the Chinese Government.

Pohiva and PSA claimed that the payment of the Chinese grant aid funds to Tongasat was unlawful and sought a declaration that the funds remained the property of the Government of Tonga and an order for repayment or alternatively damages payable to Government of Tonga.

Financial positions

In this case, Pohiva brought his claim on behalf of an unincorporated body, the Friendly Islands Democratic Party but accepted a personal liability for costs if he is unsuccessful.

Mr Justice Scott had referred to the financial positions of the two appellants with PSA holding $47,445 in term deposit and there was nothing however to show that the constitution of the society permits members funds to be spent on or secured to an action of the present kind in which the interests of the society are at best tangentially involved.

“For Pohiva, it is a matter of record that he has incurred substantial unpaid costs from previous associated proceedings and that he has previously made public appeal for donations to allow him to proceed further. 

“In all the circumstances I am satisfied that each of the plaintiffs should pay to the Registrar of the High Court $20,000 by way of security. Pending payment the proceeding is stayed,” ruled the judge.

The Appeal Court said it was for the respondents to show that PSA might be unable to pay costs if ordered to do so. The respondents put forward no credible evidence to support their allegation that the society was insolvent.

Evidence that the society had a substantial term deposit and was fundraising for the case was uncontradicted therefore did not discharge the onus of proof resting upon them. Their application for security against PSA failed at the second step and should have been dismissed by the judge.

For Pohiva, Tongasat concentrated its fire in the Supreme Court entirely on the unincorporated political party on behalf of whom he said he was suing.

"Tongasat set out to show that the party had no funds. But they overlooked the fact Pohiva had made himself personally responsible for any costs awards. His personal assets, such as they may be, are available. The Supreme Court was given by the respondent no information on his personal position. The respondents also did not suggest to the court that he personally was not good for costs."

Justice Scott took it upon himself to rely on his knowledge of other associated proceedings in which costs award had been made against Pohiva, which the judge believed had not been paid.  

"He should not have done this. For all he knew, there may have been a payment or a reason other than impecuniosity for any non-payment. It was unfair for the judge to raise the matter when the second respondent had not chosen to do so."

The Appeal Court then ordered Tongsat to pay the appellants' costs in this court and in the Supreme Court to be taxed if not agreed. 

No order for costs in this court against the first respondent the Kingdom of Tonga, in view of its limited role.