SEYLAN BANK LTD
V.
JUNAID
 
 

COURT OF APPEAL
EKANAYAKE.J
SRISKANDARAJAH.J
CALA 304/2003 (LG)
DC HAMBANTOTA3421/SPL
JUNE 15, 2007 

Recovery of Loans by Banks (Special Provisions) Act 4 of 1990 - Interim injunction issued - Requirements - Equitable relief - District Judge's conclusions erroneous - Appellate court taking a different view on the same matter and confirming order?

The plaintiff - respondent instituted action against the defendant Bank seeking inter alia, a declaration that the liability of the plaintiff , under two mortgage bonds should be confined to Rs. 200,000/-, a declaration that the plaintiff is entitled to release of the bonds after paying the aforesaid sum of Rs. 200,000/-. Further an interim injunction was sought restraining the defendant Bank from selling the mortgaged property.
 

The District Court issued the injunction on the ground that the plaintiff has a strong case in his favour by virtue of the fact that he had expressed his consent to settle the claim paying the money due on the bonds since the defendant Bank was possessed of his fixed deposit.

Held:

(1) The trial Judge's reasoning is erroneous, as the plaintiff caused to settle the amount due under the bond does not constitute a good ground for the plaintiff to pass the test of a prima facie case, which being the first and foremost requirement for the issuance of an Interim injunction.

Held further:

(2) A party who seeks the aid of Court in granting an Interim injunction must as a rule, be able to satisfy Court on three requirements.

(a) Has the plaintiff made out a prima facie case?

(b) Does the balance of convenience lie In favour of the plaintiff?

(c) Do the conduct and dealings of the parties justify the grant of the same - do equitable considerations favour the grant of same ?

(3) The plaintiff has passed all three tests.

Per Chandra Ekanayake, J.

"Though I am unable to agree with the reasons on which the trial judge had based his conclusions, for the reasons given I am inclined to hold the view that this is a fit instance to have granted the interim injunction.

Cases referred to :

1. Jinadasa v. Weerasinghe 31 NLR 33
2. Preston v. Luck (1884) 27 Ch. D 506
3. F.D. Bandaranayake v State Film Corporation- 1981 - 2 Sri LR 303
4. Gulam Hussein v. Cohen-1995- 2 Sri LR- 365
5. Dissanayake v. Agricultural and Industrial Corporation - 64 NLR 283
6. Yakkaduwa Sri Pragnamara Thero v. Minister of Education - 71 NLR 506
7. Ramachandra and Another v. Hatton National Bank - 2006 - 1 Sri LR- 393 

APPLICATION for leave to appeal from an order of the District Court of Hambantota.

T. B. Waduressa for defendant - petitioner
M. G. M. Ali Sabry for plaintiff - respondent
 

Cur. adv. vult.

June 15, 2007
Chandra Ekanayake, J.

The defendant- petitioner (hereafter sometimes referred to as the defendant) by this leave to appeal application has sought inter-alia; 

Leave to appeal against the order of the learned District Judge of Hambantota dated 28. 7.2003 (P24) pronounced in the District Court, Hambantota case No.342/Spl, to set aside the same and to dissolve the enjoining order and dismiss the application for interim injunction made by the plaintiff-respondent in the said case.

The plaintiff- respondent (hereafter sometimes referred to as the plaintiff) had instituted the 'above styled action in the District Court of Hambantota against the defendant - bank seeking inter-alia, a declaration that the liability of the plaintiff under the two mortgage bonds (P2 and P3) is confined to a sum of Rs. 200,000 and declaration that the plaintiff is entitled to release of the said bonds after paying the aforesaid sum of Rs. 200,000. Further an interim injunction was also sought (as per sub paragraph(C) of the prayer to the plaint) restraining the defendant from selling the property in dispute which was morgaged in terms of the said bonds P2 and