LA Jarden Collector Agency Pty Ltd and Richard Hill & Associates v Masket Iangalio and Public Curator of Papua New Guinea

• Jurisdiction: Papua New Guinea
• Judge: Injia J and Kirriwom J:
• Judgment Date: 31 August 1998
• Citation: (1998) SC597
• Court: Supreme Court
• Year: 1998
• Judgement Number: SC597

Supreme Court: Los J, Injia J, Kirriwom J

Judgment Delivered: 31 August 1998

SC 597

PAPUA NEW GUINEA

[In the Supreme Court of Justice]

SCA NO. 40 OF 1998

BETWEEN

LA JARDEN COLLECTOR

AGENCY PTY LTD

First Appellant

AND

RICHARD HILL & ASSOCIATES

Second Appellant

AND

MASKET IANGALIO

First Respondent

AND

PUBLIC CURATOR OF PAPUA

NEW GUINEA

Second Respondent

Waigani: Los, Injia & Kirriwom, JJ

1998: 29 July

31 August

A Manase, for Appellants

G Sheppard, for First Respondent

LOS, J: The First Respondent objects to competency of the appeal by the Appellants. The objection is on two grounds. Firstly it is said that the nature of the judgment which the appellants seek to appeal against requires leave. The appellants have failed to obtain leave.

In the second ground its said that the appellants have filed notice of appeal before obtaining any leave which is contrary to the Supreme Court Act.

It is argued on behalf of the First Respondent that the National Court decision the subject of this appeal is interlocutory. Thus leave must be obtained before appealing. The appellants on the other hand argue that the decision is final and no leave is required.

Where a decision of the National Court sought to be appealed from is interlocutory, leave must be sought. That is the requirement under section 14 (3)(b) of the Supreme Court Act. It says:

"(3) No appeal lies to the Supreme without leave of the Supreme Court —

(a) …

(b) from an interlocutory judgement made or given by the National Court."

But the question here is whether the National Court judgment is interlocutory. Briefly the First Respondent was made an insolvent upon application by various creditors. The Second Respondent was made an official trustee to administer the insolvency, and many creditors' claims were lodged and accepted by the trustee and they were paid but the two appellants' claims were rejected. The First Respondent then made an application before the National Court to annul the insolvency order. The appellants were represented and the application was objected to by their counsel. After hearing the arguments, the court in its discretion granted the order sough by the trustee. The main part of the order was "that the adjudication of Insolvency made on 11 March 1998 is annulled".

What is a final judgement or interlocutory judgment has been subject of various decisions. Some of these decisions have been listed in the written submission by the appellants. The difference between the two is not always

clear. But generally it is as pointed out in Provincial Government of North Solomons -v- Pacific Architecture (1992) PNGLR 145. At page 147 the Court said:

"Generally, two tests have been propounded as to whether a judgement is final or interlocutory. The first test is that the Court will have regard to the nature of the application not to the nature of the order made. Thus, a judgment or order must be interlocutory in character unless it is made on an application which must operate in such a way that whatever judgment or order is given or made on it, it must be finally dispose of the dispute or the controversy between parties. The other test is that the court will look at the order made by the court below and not the nature of the application so that if the order finally disposes of the rights of the parties, it is final; but if it does not, then it is interlocutory."

An example of the first test was followed in Rimbink Pato -v- Chris Haiveta and Ors (1997) SC 527. The court there looked at what the two motions meant to do, that is whether they were meant to dispose of the interests or dispose of the substantive disputes between the parties altogether. The court decided otherwise even though the proceedings were dismissed.

The Appellants do not dispute the law relating to what is an interlocutory judgment. But they submit that in the facts of this case, the order is final. It is final because it puts the First Respondent in his original position as distinct from an order to discharge. They rely on an English case, John -v- Mendoza (1939) 1 KB 141, to support that proposition. The facts as summarized in the appellants submission are these: Mendoza, an insolvent, persuaded John, a creditor, to falsely declare that Mendoza did not owe him any money thus enabling grant of an annulment order. John subsequently tried to recover the debt from Mendoza failed. The reason was that he deliberately abstained from proving his debt in the insolvency of Mendoza.

I do not consider that John -v- Mendoza helps the appellants on the facts. But some difficulties may be faced from the implication and consequences arising from the annulment order taken under s 141 of Insolvency Act. It says:

"If an insolvent, or a person on behalf of an insolvent —

(a) pays all his creditors in full; or

(b) obtains a release of the debts due by him to his creditors,

the insolvent may apply to the Court for an order annulling the adjudication, and on being satisfied that all the creditors of the insolvent have been paid in full or have released their debts the Court may make such an order, on such terms as to commission or remuneration, or charges already incurred, as it thinks just."

Any order under this section signifies that all creditors have been paid and the insolvent has been released of his debts by those he still owed. However, Mr Sheppard's argument on this is that an annulment order under s 141 does not end the right of the parties because of the provisions of sections 97 and 150 of the Act. Section 97 says:

"(1) The insolvent or a creditor, debtor or other person aggrieved by any act or decision of a trustee may appeal to the Court.

(2) On an appeal under Subsection (1), the Court may —

(a) confirm, reverse or modify the act or decision complained of; and

(b) make such order as it thinks just.

The appellants had the right to appeal to the National Court under this section but they failed to do so. That right has yet to be utilized. This argument makes sense. The only difficulty is that at what point in time the order to annul would lose its interlocutory status if it depends on utilization of the provision of s 97 by a creditor. The counter argument by the Appellants is that the official trustee did not advise them that their claims had not been accepted. Be that as it may it appears clear that if they missed that procedure they still have a right under s 150 to ask the same court to review, or rescind its order. The section says:

"The court may review, rescind or vary any order made by it under this Act".

I consider it clear that s 150 is all the more reason for holding that National Court decision is not final.

Because of the view I take on the first ground of objection, it is not necessary to address the second part of the ground. Suffice is to say that if leave was sought it had to be properly done in accordance with Order 7, Divisions 1 and 2 as appropriately discussed and decided upon by the Supreme Court in Henzy Yakham and another -v- Stuart and Carol Merriam (1996) SC 533.

Lastly, the appellants argue that the grounds of appeal are based on law and mixed fact and law. Therefore leave is not required. This submission is ill conceived. Once a decision of the National court is interlocutory, it is irrelevant whether an appeal is based in law, leave must be sought under s 14(3) of the Supreme Court.

I would uphold the objection to competency

INJIA and KIRRIWOM JJ.: This is a preliminary application objecting to the competency of this appeal before the Supreme Court. The first respondent, the applicant herein, seeks dismissal of this appeal at this stage because, he submits, the decision of the National Court appealed against was not a final order but an interlocutory judgment. Under the Supreme Court Act Chapter 37 and the Supreme Court Rules leave is required to appeal against an interlocutory judgment or ruling of an

interlocutory nature which, it is submitted, the appellants did not seek nor first obtained before lodging their appeal. Thus, it is submitted, their appeal is incompetent and must be dismissed.

The first and second appellants who are the respondents in this application contend that the decision appealed against is a final judgment that concluded the proceedings before the Court below. They submit that it was not an interlocutory order, therefore leave is not necessary and...