Supreme Court allows appeal and orders retrial for confusing credibility with burden of proof.

[*7] 1986 June 12

(A. LOIZOU, DEMETRIADES, PIKIS, JJ.)

APPELLATE JURISDICTION

Doros Ieropoulos,

Appellant-Defendant,

v.

LAMARKO LTD.,

Respondents-Plaintiffs.

(Civil Appeal No. 6773).

Evidence - Credibility of witnesses and the discharge of the burden of proof - Two wholly separate issues - Questions of credibility should not be resolved by reference to the burden of proof - The trial Judge should have first determined the issues of credibility and then decide on which direction the evidence preponderated.

P. Pavlou, for the Appellant.

M. Christodoulou, for the Respondents.

JUDGMENT

The judgment of the Court will be delivered by:-

PIKIS,J.:- The respondents obtained judgment against a third party that remained unsatisfied. A writ of movables was issued and arrangements were made for its execution. A lorry was hired and a bailiff of the District Court of Limassol accompanied by the judgment-creditor or his representative, visited the third party in order to effect execution by seizure of items of furniture, the balance of the value of which founded the judgment-debt. [*8]

At that stage the appellant intervened, as admitted, with a view to obviating or forestalling execution, depending on which of the two rival version of events advanced before the Court was accepted. It is an indisputed fact that appellant paid a sum of £500. - and execution of the writ was thereupon suspended.

Thecase of the respondents as outlined in the statement of claim was that on the same occasion the appellant agreed to pay the balance in two instalments. The averments made in the body of the statement of claim suggested the existence of an agreement whereby in consideration of the respondents waiving their claim .against the judgment-debtor, the appellant would pay the balance, after the payment of the sum of £500.-, in two instalments. Notwithstanding these substantive allegations the claim was formally raised in the alternative, that is, for the recovery of a debt founded by the above agreement or by virtue of a guarantee. The evidence adduced by the respondents tended to support a new agreement for a question of the execution by the appellant of a bond arose but eventually it was dispensed with upon respondents expressing readiness to accept the word of the appellant as just as good as his signature. Leaving aside for a moment the precise nature of the agreement reached, it emerged as an indisputable fact that the writ of movables was not withdrawn and was allowed to remain in being, returned some time later as unexecuted for lack of movables. A writ of movables, it may be noted, can only be withdrawn in the manner laid down [*9] by Order 40, r. 11, of the Civil Procedure Rules. The persistence of the respondents in the execution of the judgment and steps ancillary to the non satisfaction of the judgment were evidenced by the taking out of an application for the payment of the balance due by monthly payments (a step in execution) and the filing of a petition for the adjudication of the judgment-debtor as bankrupt, a proceeding withdrawn before its judicial resolution.

There was conflicting evidence before the Court respecting the terms of the agreement between appellant and respondents and a lot of argument about its effect. In resolving the issues before him the trial Judge wholly overlooked the alternative basis of the claim and failed to analyze and resolve in its correct perspective the evidence before him. He found the parties concluded a new agreement .whereby the appellant undertook to pay the balance in two instalments, accepting in effect that in consideration thereof respondent absolved the judgments creditor of his obligations. He arrived at this conclusion, notwithstanding undisputed evidence that respondents took steps in execution after the aforesaid agreement, a fact significant in two respects: first, with regard to what had been agreed and .secondly, assuming a new agreement had been reached, the effects of such action on the part of the respondents on the agreement. Steps taken in execution tended to negative the existence of an agreement absolving the

judgment-debtor of his obligations. If that was the case, the agreement was to a different effect from what [*10] the trial Judge found it to be.

Moreover, the Judge failed to examine the implications on the contractual obligations of the appellant, as he found them to be, of the conduct of the respondents in seeking execution of the judgment-debt that they agreed to forego. Did such conduct amount to a renunciation of their agreement or more significant still, did it give the right to the appellant to terminate it? The Judge addressed himself to none of these questions.

Also the Judge, as it appears to us, laboured under a misapprehension in making his findings as to the implications of discharge of the burden of proof. In fact it appears that he confused two wholly separate issues, namely, adjudication upon the credibility of witnesses and resolution on the discharge of the burden of proof. Reading the judgment we are left with the impression he resolved questions of credibility by reference to the burden of proof, whereas what he ought to have done was to determine issues of credibility first and then decide in what direction the evidence preponderated, having regard to the testimony accepted by the Court as creditworthy.

In the end we feel there is only one alternative to do justice in the case and that is to order a retrial. The appeal will, therefore, be allowed. A retrial is ordered; the respondent shall bear the costs of the appeal. Costs before the trial Court will be costs in the cause. As the trial Judge made findings of fact, it is proper that the case be taken by another member of the District Court of [*11] Limassol. The parties will, of course, be at liberty to apply for the amendment of their pleadings, if they so deem appropriate and always subject to the discretionary powers of the Court in this area.

Appeal aIlowed.

Retrial ordered.