Mainland Holdings Limited v Paul Robert Stobbs and Three (3) Others (2003) N2522

• Jurisdiction: Papua New Guinea
• Judge: Injia DCJ
• Judgment Date: 29 October 2003
• Court: National Court
• Citation: (2003) N2522
• Year: 2003
• Judgement Number: N2522

Full Title: Mainland Holdings Limited v Paul Robert Stobbs and Three (3) Others (2003) N2522

National Court: Injia DCJ

Judgment Delivered: 29 October 2003

1 Civil—Interim injunctions—Effect of—Extension of contract of employment of company's general manager which had expired—Application to dissolve interim injunction—Grounds—Change in relevant circumstances since grant of—Principles of equity on enforcement of private contracts for personal services discussed—Equity maxims "He who seeks equity must do equity" and "He who seeks equity must come with clean hands" applied—Interim injunctions dissolved.

2 Adam P Brown Male Fashions Pty Limited v Philip Morris Inc (1981) 148 CLR 170, Jimi Co–op Dairies Ltd v Capital Dairy Products Ltd (1989) 1 PRNZ 622, Modilon Automotive Pty Ltd v Kevin Southcomb [1997] PNGLR 158, Regent Oil Co Ltd v LJ Leavesly (Linchfield) Ltd [1968] 1 WLR 1210, Westgold Resources NL v St Barbara Mines Ltd [2003] WASC 29, Williamson Robinson & Co Ltd v Heve [1898] 2 CLR 451 referred to

___________________________

N2522

[IN THE NATIONAL COURT OF JUSTICE AT LAE]

O.S. NO. 418 OF 2003

BETWEEN:

MAINLAND HOLDINGS LIMITED

-Fist Plaintiff-

AND:

PAUL ROBERT STOBBS & THREE (3) OTHERS

- Defendants-

AND:

LAE : Injia, DCJ

2003 : October, 17, 23-24, 29

Civil – Interim injuctions- Effect of - Extension contract of employment of company’s general manager which had expired - Application to dissolve interim injunction- Grounds- Change in relevant circumstances since grant of - Principles of equity on enforcement of private contracts for personal services discussed - Equity maxims “He who seeks equity must do equity” and “He who seeks equity must come with clean hands” applied- Interim injunctions dissolved.

Cases cited in the Judgment:

Adam P. Brown Male Fashions Ltd v. Philip Morris Inc (1981) CLR 170

Jimi Co-op Daries Ltd v Capital Diary Products Ltd (1989) 1 PRNZ 622

Modilon Automotive Pty Ltd v Southcomb [1997] PNGLR 158

Regent Oil Co. Ltd v L.J.Leavesly (Linchfield) Ltd (1968) 1 WLR 1210

Westgold Resources NL v St. Barbara Mines Ltd & Anor {2003}WASC 29

Williamson Robinson & Co Ltd v Heve [1898]2 CLR 451

I. Molloy with R. Pato for the Plaintiffs

M. Wilson with N. Merrick for the First and Fourth Defendants

B. Ovia for the Second and Third Defendant

29 October, 2003

Injia, DCJ: The plaintiffs apply before me to dissolve the interim injunctive orders granted by Kirriwom J. on 29th August, 2003. Ordinarily, this motion should be moved before Kirriwom, J., but because His Honour declined to continue dealing with the matter, the motion came before me. The defendants contest the motion.

The injunctive order is the subject of an appeal and an application for stay filed in the Supreme Court at Waigani, both of which are pending determination. As to the proper approach to be adopted by this Court in assuming jurisdiction in this matter in the light of the pending appeal, I accept the position taken by both parties that the National Court has jurisdiction to vary or dissolve an interlocutory order notwithstanding an appeal and application for stay has been filed against the same order, which are pending hearing. There is extensive authority in support of this proposition, some of which have been cited by counsel.

It is also agreed between the parties that this discretionary jurisdiction is exercised where there are changes in relevant circumstances since the interlocutory order was made which render the continuation of the order no longer necessary or appropriate. However, there is some contention between the parties as to whether the interlocutory order should be varied or dissolved on other grounds such as where new facts which existed at the time of the injunctive order and not disclosed then but they are subsequently discovered; or where it is subsequently discovered that the order was granted on erroneous legal basis. Mr. Molloy for the plaintiffs argued in the affirmative and cited in support cases including Adam P. Brown Male Fashions Ltd v. Philip Morris Inc. (1981) CLR 170 at 178; Westgold Resources NL v. St. Barbara Mines Ltd & Or [2003] WASC 29 and Reqent Oil Co. Ltd v. J.T. Leavesly (Linchfield) Ltd [1968] 1WLR 1210. Mr. Wilson for the First and Fourth defendants contends that the Court’s jurisdiction is restricted to change in relevant circumstances, and matters such as new or existing facts subsequently discovered and the appropriateness or legal correctness of the existing order are matters for the appellate court to address in the pending appeal.

In my view, the trial Court has wide discretionary powers to control the management of the case until its substantive disposition. In terms of its interlocutory proceedings, the Court has wide powers to grant or

refuse to grant, vary or set aside, dissolve or discharge an interlocutory order either on application by an interested party or upon its own motion, in a wide range of situations including change in relevant circumstances which render the continuation of the order no longer necessary or appropriate. It is also in the Court’s discretion to vary or discharge an interlocutory order, where the conditions, if any, stipulated in the order have been met and it is no longer necessary or appropriate to sustain the order. Further, it is in the discretion of the Court to vary or discharge an interlocutory order if it is subsequently discovered by the Court that the interlocutory order was founded on wrong principle.

In the exercise of its regulatory jurisdiction, the Court also has wide discretion to protect itself or its process from abuse by parties aggrieved by its earlier order, seeking to have a second opportunity to re-argue the case in order to reverse its earlier decision. In cases where the earlier interlocutory order is subject of an appeal, the Court should be reluctant to engage in any deliberations on the facts and law which would or is likely to interfere or usurp the review powers of the appellate Court to review findings of fact or law. This is particularly so when a second judge is invited to vary or discharge an interlocutory order of the first judge. In this context, I find the text from the New Zealand case of Jimi Co-op Daries Ltd v. Capital Diary Products Ltd (1989) I PRNZ 622, at 627 submitted to me by Mr. Wilson persuasive, and I quote:

“It is in principle wrong that a litigant should have second opportunity merely to re-argue or to reinforce his case with evidence which was already available but which was not called. There is a reluctance on the part of any Judge and some difficulty indeed for a Judge to rehear and reconsider his own decision particularly where that has been subject to an extended argument, with evidence, and an occasion to consider his decision even if that may be for a short period. There is a reluctance on a Judge of coordinate jurisdiction to review the decision on the facts or even the law of another Judge. There is the possibility that if the right of review was free and open-ended there could be a repeated application for reconsideration and review of any interlocutory application before all the Judges that might be available.”

In the present case, it is these principles which compel me to qualify what I said earlier, as to the wide discretion I have to review an existing interlocutory order. For this reason, I accept Mr. Wilson’s

submissions in part - that generally speaking, the exercise of my discretion should be limited to the change in relevant circumstances since the order, which render the continuation of the interlocutory order, unnecessary or inappropriate in the circumstances. However, this does not necessarily follow that I cannot in the exercise of my discretion, revert to relevant circumstances on which the existing order is based, and established principles in determining the appropriateness of any order I propose to make. I am entitled to do so, not with a view to reviewing the earlier court’s exercise of discretion, but to determine the continuance of the order in the light of all relevant circumstances and principles.

Having reached this conclusion, I consider it important to look at the nature of the interlocutory order in this case, and determine the correct approach to be adopted.

In the Originating Summons, filed on 4th August, 2003, the plaintiffs seek substantive relief in terms of three (3) declarations: (1) the Second Defendants had no legal or equitable authority to dispose of or deal with the shareholding of the Third Defendant in the First Plaintiff, and any purported authority exercised by the Second Defendant was invalid: (2) A declaratory order that any transfers of shares by the First Plaintiff to the First Defendant (hereinafter referred to on Mr. Stobbs) and the Fourth Defendant was invalid: (3) A declaration that notice of extra-...