A creditor must make use of one procedure

In a judgement delivered by the Magistrate’s Court on 26 February 2014 in the names Michael Darmanin noe v Dino Schembri, a judicial letter sent by Clean Away Services Ltd against exchange, was deemed invalid because they had filed a counter claim in a separate action that Mr Schembri had instituted.

File photo
File photo

The defendant, Dino Schembri, had filed an application in the acts of the judicial letter where he held that he was asked to pay the bill of exchange via a judicial letter filed by Clean Away Services Ltd. 

The judicial letters were not accompanied by copies of the bills of exchange. 

In addition, Clean Away Service Ltd had filed a counter claim in a court suit instituted by Dino Schembri against Clean Away Service Ltd. 

This, Mr Schembri said, was an abuse of law. In his defence, Schembri insisted that in using two separate procedures to collect the same debt, Clean Away Services Ltd was abusing of the law and it was him who had to choose what action he was to use. 

On his part, Michael Darmanin on behalf of the Company did not reply to this action.

Presided by Magistrate Dr Consuelo-Pilar Scerri Herrera, the Magistrates' Court held that the defendants had admitted to not presenting copies of the bills of exchange, but had nevertheless, filed them in court five days before judgement. 

The Magistrate also claimed that in the submissions made before the court, the defendant had a right to choose which forum to take an action. 

The application filed by the Company was filed in terms of Article 253(e) of the Code of Organisation and Civil Procedure, where a person against whom a judicial letter to served with regard to bills of exchange has 20 days to object to the judicial letter becoming an executive title. The Court confirmed that the application was filed within the 20 days. 

Despite the fact that the bills of exchange were not annexed to the judicial letter, the Magistrate did not deem it as null and void as the law does not provide much on its formality. 

The Court also examined whether the bills of exchange could be executed at law. 

There are two criteria in that the signature on them are authentic and that there are no serious reasons to object to them becoming an executive title and therefore, demand payment.

Magistrate Scerri Herrera held that the grave reasons must be in line with the Commercial Code. 

"The Court cannot examine the merits of the obligations under which the bills were issued. 

"This should be done in a separate court action while the court is simply empowered to verify whether there is a serious and valid reason to suspend the execution of the bill of exchange." 

In her judgement Magistrate Scerri Herrera held that Article 253(e) of the Code does not explain what the serious and valid reasons are, but leaves it to the discretion of the Court. The judgment mentioned as an example of when the signatures are given because of fear of violence. 

However, in this particular case, Dino Schembri had instituted a separate action against Clean Away Services Limited. 

The company had filed a reply to this action and a counter claim a day before the judicial letter was filed. 

The Court examined this counter claim and it makes reference to the bills of exchange. Therefore Mr Schembri was correct to state that there were two claims for the payment of these bills.  

This goes counter to the legal principle, "Electa una via, non datur recursus ad alteram" (meaning when there is concurrence of means, he who has chosen one cannot have recourse to another). 

This principle has been derived from Roman Law. In previous judgements Sunsport Tours Ltd -v- C.h. Caterers Limited, decided on 16 December 2003 upheld this principle, that when a party chooses a line of action, whether as a plaintiff or a defendant, it was not acceptable that that party changes completely the basis of the right he/she is invoking in a different action. 

In this present case, although Michael Darmanin did not present different claims in the same judicial act, he did two separate claims to be paid for the same bills of exchange. This cannot be done.

The Magistrate's Court upheld Dino Schembri's request that the judicial letter he received would not render the bills of exchange executable before the court case Dino Schmebri -v- Clean Away Services Limited would be decided.

Malcolm Mifsud is a partner at Mifsud & Mifsud Advocates

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