Jack Livinai Patterson v National Capital District Commission (2001) N2145

• Jurisdiction: Papua New Guinea
• Judge: Kandakasi J
• Judgment Date: 05 October 2001
• Court: National Court
• Citation: (2001) N2145
• Year: 2001
• Judgement Number: N2145

Full Title: Jack Livinai Patterson v National Capital District Commission (2001) N2145

National Court: Kandakasi J

Judgment Delivered: 5 October 2001

N2145

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

WS No. 630 of 2001

JACK LIVINAI PATTERSON

-Plaintiff-

V

NATIONAL CAPITAL DISTRICT COMMISSION

— Defendant-

WAIGANI: KANDAKASI, J.

2001:

PRACTICE & PROCEDURE — Failure to disclose reasonable cause of action — Essential element of contract not pleaded and non-existent — Non-compliance of public tender and Ministerial Approval of contract with public body — Failure to put costs in taxable form — Action dismissal — Public Finance (Management) Act 1995 ss. 48(4), 59 and 61 — Lawyers Act 1986 ss. 62(1) and (2) and (63)(2) — Professional conduct Rules ss.3 and 13 — National Court Rules O.12, r.40(1) & O. 22 r. 49.

CONTRACT — Essential elements of consideration or price with certainty — Absence of — No consensus and idem — No contract — Non-compliance of relevant and applying statute — Contract illegal, null and void — Public Finance (Management) Act 1995 ss. 48(4), 59 and 61.

LAWYERS COSTS — Lawyer and client not agreeing on costs — Contract — Lawyers bill of costs must be in taxable form — Lawyer must advise client of right of taxation — Failure to put Costs in taxable form and advise client of right of taxation amounts to failure to give rise to a cause of action for recovery of costs — Lawyers Act 1986, ss. 62(1) and (2) and 63(3) — Professional conduct Rules, ss. 3 and 13.

Facts

Mr. Patterson sued for unpaid legal costs totaling over K4.3 million. He claimed being engaged by the National Capital District Commission ("NCDC") to render legal services. Public tender and ministerial approval requirements under the Public Finance (Management) Act were not met. There was no agreement on the consideration or price for the services. Accounts were render to the NCDC but not in taxable form. NCDC was not advised of its rights to have the costs taxed and when asked to put costs in taxable form, Mr. Patterson failed to do that. NCDC is applying by motion to dismiss the claim for failure to disclose a reasonable cause of action.

Held

1. There was no agreement and therefore a lack of consensus idem on the essential element of price or valuable consideration for the provision of legal services to the NCDC by Mr. Patterson.

2. The alleged contract was illegal, null and void and therefore unenforceable for non-compliance of the requirements for public tender and ministerial approval under the Public Finance (Management) Act 1995.

3. Lawyers are under a duty to advise their clients of the client's right to a taxation of their costs and give meaningful opportunity to the clients to exercise their right to a taxation of their costs, which includes a provision of a bill of costs in taxable form. The purported bill of costs in this case were not put in taxable and the NCDC was not given a real opportunity to have the purported bills of costs taxed. Therefore, no cause of action accrued to Mr. Patterson.

4. By reason of the above no reasonable cause of action is disclosed.

PNG Cases Cited

PNG Forest Products v The State [1992] PNGLR 85.

Ronny Wabia -v- BP Exploration Co. Ltd, Department of Mining & Petroleum and The State, N1697

Sylvanus Gorio v. National Parks Board [1982] PNGLR 364 at pages 368 — 369.

Panga Coffee Factory Pty Ltd v. Coffee Industry Corporation Limited (Unreported but numbered judgement).

Wag v. Mount Hagen Town Authority [1996].

Inakambi Singorom v. John Kalaut [1985] PNGLR 238 at 241.

PLAR No. 1 of 1980 [1980] PNGLR 326.

Norah Mairi v. Alkan Tololo & Ors [1976] PNGLR 125 at 136.

Ombudsman Commission Investigations of the Public Prosecutor [1978] PNGLR 345 at page 389.

Peter Ipu Peipul v. Sheehan J., Ori Karapo and Ivoa Geita (Leadership Tribunal) & Ors (Unreported and unnumbered judgement) at page 11.
The State v. Keboki Business Group Incorporated & Morobe Provinsel Gavman [1985] PNGLR 369.

Visvanathan Subendranathan v. The State (Unnumbered Judgement).

Marsh -v- Hay [1981] PNGLR 392.

Paul Paraka Lawyers v. NCDC.

Philip Mamando v. Lumusa Local Level Government Council (13/9/98) N1752,

Other Cases Cited

Hubbuck & Sons Ltd -v- Wilkinson Heywood & Clark Ltd [1899] 1 QB 86 at pp. 90-91; [1895-9] AII ER Rep 244 at page 247.

Dyson -v- Attorney General [191

1] I KB 410 at pages 414 & 419.

Nagle -v- Feilden [1966] I AII ER 689 at 697 [1966] 2QB 633, at page 651.

Allen -v- Gulf Oil Refining Ltd [1981] 1 All ER 353 at page 355; [1981] AC 1000 at — 1111.

Attorney General of the Duchy of Lancaster -v- London and North Western Railway Co. [1892] 3 Ch 274, at 277.

Thomas v. Thomas (1842) 2 Q.B. 851 at 859.

Scammel & Nephew Ltd v. Ouston [1941] AC 25.

Credit Suisse v. Allerdale BC [1996] All ER 129.

Hunter Brothers v. Brisbane City Council [1984] 1 QdR 328.

Wade v. Gold Coast City Council (1971) 26 LGRA 349.

Strealine Travel Service Pty Ltd v. Sydney City Council (1981) 46 LGRA 168.

Counsels

S. Ketan for the Plaintiff

J. Naipet for the Defendant

5th October 2001

KANDAKASI J: I have two motions before me for determination. The first is the defendant's ("the NCDC"), seeking a dismissal of the proceedings pursuant to Order 12 r.40 (1) of the National Court Rules ("the Rules") for not disclosing a reasonable cause of action or is otherwise frivolous, vexatious and or an abuse of process. The motion is the plaintiff's ("Mr. Patterson"), seeking a strike out of the NCDC's defence and for summary judgement to be entered for Mr. Patterson in the sum of K4, 354, 502.00 for legal services allegedly rendered to the defendant.

Mr. Patterson relies on section 63 (2) of the Lawyers Act 1986 ("the Lawyers Act"), argues that NCDC failed to ask for a taxation of his bills of costs and a period of more than one month passed before the issue of the proceedings. Therefore, it precluded from taking issue on the bill. The NCDC contents however, that the bills of costs were not presented in taxable form having regard to the provisions of s.62 (2) of the Lawyers Act so as to allow for a taxation of Mr. Patterson's costs. By reason of that, NCDC agues that Mr. Patterson is not entitled to bring this proceedings without first having facilitated and obtained a certificate of taxation. Hence NCDC argues that, the issue of these proceedings amount to an abuse of process if not a failure to disclose a reasonable cause of action and or are frivolous or vexatious and as such they should be dismissed with costs.

I consider it more appropriate that I should deal with the NCDC's application first because a determination of that application will determine whether Mr. Patterson's application should be dealt with at all.

The issues presented by NCDC's application are these:

1. Do the pleadings disclose a reasonable cause of action against the defendant?

2. Are the proceedings frivolous and vexatious?

3. Do the proceedings amount to an abuse of the court's process by reason of Mr. Patterson's costs not being put in taxable form and not being subjected to taxation under section 62 (2) and (63(2) of the Lawyers Act 1986?

The first and second issues can be dealt with together because the same kind of principles or considerations applies to them. I will therefore deal with them in that way.

The relevant evidence is set out in the affidavits of Judy Naipet and Joseph Aisa (Jnr) for NCDC both sworn on the 17th of May 2001. Mr. Patterson's own affidavit of the 7th of June 2001, is the only evidence of him.

From these affidavit evidence the facts are not in issue. Mr. Patterson claims he was engaged, as a lawyer by NCDC to help recover certain outstanding Sales and Services Tax owed by a number of companies and business entities. The engagement was by letter dated 25th February 1999. The letter of engagement reads in relevant parts as follows:

"RE: COLLECTION OF OUTSTANDING SALES AND SERVICES TAX FOR THE NATIONAL CAPITAL DISTRICT — (NCDC)

I refer to the above and advise that the Management of NCDC has decided to instruct your firm to collect outstanding Sales and Services Tax owed by Companies and Business entities in the National Capital District Commission. …

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