The Bhutanese Leading the way.
A contractor named Tshering Chophel, owner of Tshering Samdrup Construction company is raising questions over how the Supreme Court changed its full bench verdict, passed in his favour on a construction payment dispute against the Royal Bhutan Police Engineering office, 6 months later with another full bench verdict.
The contractor said that the Supreme Court had initially issued an enforcement order and the Chief Justice had even dismissed an appeal letter from the RBP five months after the verdict to not pay and had asked it to pay the contractor.
The Supreme court on 4th October 2023 asked the RBP to pay his company Nu 4.387 mn in a construction payment dispute over the construction of two officers’ quarters in the RBP compound in Thimphu.
Tshering said it was a full bench verdict and RBP was given three months’ time till 15 December 2023 to pay. The RBP Engineering office requested an extension till 14th February 2024 which Tshering agreed to.
When 14th February came the RBP did not pay. Tshering said he called the RBP and he was told payment would be made in three days by 19th February as a senior official was not there and he said they even took his bank account number.
However, no payment was made and on 26th February RBP said it cannot make the payment.
The RBP then wrote an appeal to the Chief Justice (CJ) stating its inability to pay on 4th March 2024. Tshering also wrote to the CJ informing that the RBP is not paying and asking for payment to be done.
Tshering produced a letter sent by the Chief Justice to both parties on 13th March 2024 rejecting the appeal by the RBP to not pay and saying the enforcement order stands.
After this the RBP filed another letter to the CJ asking for a review of the Supreme Court judgment, 6 months after it was passed. On 25th March 2024 to the shock of Tshering the Supreme Court passed a new judgment reducing the amount the RBP Engineering Office has to pay to Tshering by Nu 3.478 mn.
This meant the Supreme Court by changing its own verdict reduced the amount to be paid from Nu 4.38 to Nu 0.916 mn.
Tshering said that the judgment was overturned based mainly on documents that had already been submitted during the trial earlier.
Case background
In 2015 Tshering Samdrup Construction won a construction bid to construct two officers’ colony buildings for Nu 65 mn and he was supposed to finish by 25th April 2016 but he could not do so and hence the RBP deducted Liquidity Damages of 10% or Nu 6.719 mn.
In the final bills the contractor put a claim of nu 8.1 mn for price escalation adjustment and others including rent for officers who the contractor says moved in before the structure was completed or handed over and hence delayed the construction.
The RBP refused to pay the rent claim and said Nu 3.4 mn worth of goods had been supplied to the contractor which the contractor said he was not aware about.
The RBP refused to pay and the Contractor put the matter in the Alternative Dispute Resolution Center (ADRC). The ADRC ruled in favour of the contractor and asked Nu 8.1 mn to be paid.
After this a 10-day period was given as per the ADR Act section 143 where either party can appeal for correction in the award any errors in computation, any clerical or typographical errors or any errors of similar nature; clarify a point or a specific part of the award; or make an additional arbitral award as to claims presented in the arbitral proceedings and not resolved in the award.
Both parties appealed and the award was brought down to Nu 5.55 mn in favour of the contractor in late May 2021.
Tshering said that the 10-day period is only for rectifying errors but the RBP submitted a Phuentsholing Dungkhag court verdict of RBP versus Bhutan Hardware and Bhutan Marble which showed that Nu 3.4 mn had been paid to them and they were to supply the goods.
Tshering said that it is his contract and he does not know why RBP was buying goods and secondly, he was not aware about the case and thirdly RBP had not submitted this during the proceedings and so the very submission of new evidence in the appeal period is not correct under ADRC Act section 143.
The RBP appealed to the High Court on 1st July 2021 and the High Court verdict later said that Tshering has to pay the RBP Nu 0.678 mn on 16th May 2022.
Supreme Court legal logic
Tshering appealed to the Supreme Court on 2nd June 2022. The Supreme Court full bench ruled in favour of Tshering on 4th October 2023 asking RBP to pay Nu 4.387 mn. This was on the grounds that the dungkhag judgement copy and money receipts does not have anything to do with Tshering, he did not give an undertaking which is required under the Evidence Act, the contractor was not informed of payment and the receipts for millions did not have seals and custom declaration. There was also no proof of handing and taking over of the goods.
The court also said that the High Court cannot accept new evidence like the Dungkhag court judgment.
However, 6 months later when the Supreme Court again decided to review the case based on the request of the RBP Tshering said that they were allowed to only submit a verbal submission.
The second Supreme Court judgment says that under Article 21 section 7 the court has the power to review its own judgments and here it said that now information has come that the RBP submitted the judgment and receipts in the ADRC itself and not just the high court and there are also RAA audit memos. The court then reduced the amount be paid by RBP from 4.387 mn to Nu 0.916 mn.
Here the contractor said that when RAA pointed out shortages the RBP just accepted it and did not allow the contractor to explain to the RAA.
Tshering argued that the ADR Act Section 143 is very clear where the 10 days appeal is only around clarification on the award and what was submitted in the proceedings, but the RBP’s submission of new evidence after the proceedings is not acceptable especially since he was not party to it.
A factor that complicated matters for Tshering was that he had allowed a friend to manage his contract project with the RBP. The friend already had another contract with RBP nearby. The friend is now absconding in another case. He now wonders if his friend complicated matters for him too.
However, the above case now raises questions about Article 21 section 7 of the Constitution which says, ‘The Supreme Court of Bhutan, which shall comprise the Chief Justice and four Drangpons, shall be the highest appellate authority to entertain appeals against the judgments, orders, or decisions of the High Court in all matters and shall have the power to review its judgments and orders.’
This case raises questions on if there should be rules around this section as it means that the Supreme Court can overturn any of its judgment with no time limit and in a case where a plaintiff in the form of RBP was not following the enforcement order, but still managed to appeal after 6 months and change the verdict.
There are also questions on if new evidence can be introduced during appeal. The Civil and Criminal Procedure Code (CCPC) does not allow this as all evidences must be presented in the trial court during proceedings.
In the past, a Judicial conference controversially decided to allow new evidences in the first court of appeal with the aim to help ordinary people unaware of the law but a lot of judgments saw dramatic change and so the former Chief Justice forbid it saying the CCPC should be followed strictly.
Supreme Court speaks
A source from the Supreme Court said that the Supreme Court had made a mistake in the first judgment and there was a danger of justice being harmed and double payments being made.
The source said the court found that the grounds of the RBP appeal was sound and the information was pertinent to the case.
The source said that in the larger interest of justice the Supreme Court reviewed the case and it can do so for every case, but this review provision of Article 21 section 7 is used only in the rarest of cases. On the issue of time limit the source said there is no provision in the Constitution that limits the time for review of Supreme Court judgments by the Supreme Court.
