Mamun Investment Limited v Nixon Koi and Onda Koim, Koim Rob, Amuni Koim, So Koim, Paul Ponda, Elias Komb, Robert Duma and Dokta Kilt representing themselves and an Association known as Mt Hagen Young Men’s Christian Association (YMCA) (2015) SC1409

• Jurisdiction: Papua New Guinea
• Judge: Sakora, David and Hartshorn, JJ.
• Judgment Date: 04 February 2015
• Court: Supreme Court
• Citation: (2015) SC1409
• Docket Number: SCA 112 of 2011
• Year: 2015
• Judgement Number: SC1409

Full Title: SCA 112 of 2011; Mamun Investment Limited v Nixon Koi and Onda Koim, Koim Rob, Amuni Koim, So Koim, Paul Ponda, Elias Komb, Robert Duma and Dokta Kilt representing themselves and an Association known as Mt Hagen Young Men’s Christian Association (YMCA) (2015) SC1409

Supreme Court: Sakora, David and Hartshorn, JJ.

Judgment Delivered: 4 February 2015

SC1409

PAPUA NEW GUINEA

[IN THE SUPREME COURT OF JUSTICE]

SCA 112 OF 2011

BETWEEN:

MAMUN INVESTMENT LIMITED

First Appellant

AND:

NIXON KOI

Second Appellant

AND:

ONDA KOIM, KOIM ROB, AMUNI KOIM,

SO KOIM, PAUL PONDA, ELIAS KOMB,

ROBERT DUMA and DOKTA KILT representing

themselves and an Association known as Mt Hagen

Young Men’s Christian Association (YMCA)

Respondents

Waigani: Sakora J, Hartshorn J and Poole J

2014: May 1st,

2015: February 24th

APPEAL – whether declaratory relief is equitable relief - Frauds and Limitations Act sections 16 and 18 considered – whether a cause of action may accrue without the knowledge of the aggrieved party

Cases cited:

Papua New Guinea Cases

Douglas Dent v. Thomas Kavali and Ors [1981] PNGLR 488

NCDIC v. Bogibada Holdings Pty Ltd and Anor [1987] PNGLR 135

Ok Tedi Mining Ltd v. Niugini Insurance Corporation and Ors (No 2) [1988-89] PNGLR 425

Overseas Cases

Kitchen v. Royal Air Forces Association & Ors [1958] 1 W.L.R. 563

Cartledge and Ors v. E. Jopling & Sons Ltd [1963] 2 WLR 210

Eddis and Anor v. Chichester Constable [1969] 1 W.L.R. 385

Tito v. Waddell (No.2) [1977] 1 Ch. 106

R. B. Policies at Lloyds v. Butler [1950] 1 K.B. 76

Ramsden v. Lee [1992] 2 All ER 204

Sheldon & Ors v. RHM Outhwaite & Ors [1995] 2 All ER 558

Tau Gumu v. Papua New Guinea Banking Corporation (2001) N2288

AWB Limited v. Honourable Terence Rhoderic Hudson Cole (No.2) [2006] FCA 913

Law Society v. Sephton & Co [2006] 2 AC 543, 2WLR 1091

H. Stanke & Sons Pty Ltd & Anor v. O’Meara [2007] SASC 246

Counsel:

Ms. E. N. Suelip, for the Appellants

Mr. D. H. Katter and Mr. J. Holingu, for the Respondents

24th February, 2015

1. SAKORA J. and HARTSHORN J: This is an appeal against a National Court decision that found that amongst others, the defendants now appellants had obtained a property in Mt Hagen known as the YMCA Hall, by fraud. The plaintiffs now respondents oppose the appeal.

2. The appellants rely upon 26 grounds of appeal.

Preliminary

3. The respondents submit that the orders sought in the notice of appeal, for the orders of the National Court in Mt Hagen to be quashed or in lieu thereof, that the respondents’ claims be dismissed, are not orders that this court may make pursuant to s. 16 Supreme Court Act, and that this appeal should be dismissed on these grounds alone.

4. We are of the view that in addition to s. 16 giving this court the discretion as to the orders it may make upon the hearing of an appeal, the wording of s. 16 (c) is of sufficient width to allow the making of orders about which complaint is made. These preliminary points raised by the respondents are rejected.

Grounds of appeal

5. The appellants’ first ground of appeal is that the trial Judge erred in that he should have found that the respondent’s claims were time-barred under s.16 Frauds and Limitations Act 1988 in that they were founded on a simple contract or on tort for which a claim shall not be brought after the expiration of six years after the claim accrued.

6. Before considering this ground of appeal, we are of the view that it would be prudent to consider the second ground of appeal first as it concerns amongst others, whether the respondents’ claims are equitable. Section 18 Frauds and Limitations Act provides that s.16 does not apply to any claim for specific performance of a contract or for an injunction or for other equitable relief. If it is found that the respondents’ claims come within s. 18 Frauds and Limitations Act, it will not be necessary to consider the first ground of appeal.

Whether s. 18 Frauds and Limitations Act applies

7. In regard to whether the respondents’ claims come within s. 18 Frauds and Limitations Act; the relief claimed in the Originating Summons are four declarations, three consequential orders and then the cost of the proceedings. No claim is made for specific performance of a contract or for an injunction.

8. As to declaratory relief and whether it can be categorised as equitable relief, we have considered the following cases:

a) in Douglas Dent v. Thomas Kavali and Ors [1981] PNGLR 488, Bredmeyer J considered the power of the National Court to grant a declaratory judgment. He stated that he considered that the National Court’s jurisdiction or power to grant a declaratory order comes from in particular the latter words of s. 155 (4) Constitution. His Honour went on to state that:

“Likewise, I consider that the power of the pre-Independence Supreme Court of Papua New Guinea to grant a declaratory order did not come from O.4 r.11 but rather from the statutory provisions conferring on that court powers of the Court of Chancery in England.”

His Honour then in detail considered that statutory history “which produced that result.”

b) in NCDIC v. Bogibada Holdings Pty Ltd and Anor [1987] PNGLR 135, Kapi DCJ (as he then was) stated that:

“Declaratory relief is an equitable remedy and, therefore, the jurisdiction of the court is to be found in the principles of equity in England which have been adopted as part of the law in Papua New Guinea.”

This however, was a case in which the proceedings were “…. instituted by way of judicial review….”

c) then in Ok Tedi Mining Ltd v. Niugini Insurance Corporation and Ors (No 2) [1988-89] PNGLR 425, Kapi DCJ stated that he agreed with Bredmeyer J in Dent v. Kavali (supra) that the jurisdiction of the Court in granting declaratory orders is now to be found under s. 155 (4) Constitution.

d) in Tito v. Waddell (No.2) [1977] 1 Ch. 106 at p259, Megarry V.C. said:

“In particular, I have it in mind that in ordinary actions for a declaration, as distinct from the Exchequer equity jurisdiction against the Crown, it is well settled that it is discretionary whether or not to make a declaration. That is not because the remedy is an equitable remedy, for as the Court of Appeal made plain in Chapman v. Michaelson [1909] 1 Ch. 238 it is not: it is neither a legal nor an equitable remedy, but statutory.”

e) in the Federal Court of Australia decision of AWB Limited v. Honourable Terence Rhoderic Hudson Cole (No.2) [2006] FCA 913, Young J said:

“45. It is a common misconception that a declaration is an equitable remedy. It is not; it is a statutory remedy that is conferred in terms emphasising that its grant or refusal is within the discretion of the Court: see Tito v. Waddell (No.2) [1977] 1 Ch. 106 at 259; Mayfair Trading Co Pty Ltd v Dreyer [1958] HCA 55; [1958] 101 CLR 428 at 454 per Dixon CJ; and Meagher, Gummow and Lehane, Equity Doctrines and Remedies, 4th ed, Butterworths, 2002, at [19-159]. The discretion is to be exercised according to the facts and circumstances of the individual case, and the considerations that may be relevant to the exercise of the discretion are ‘so numerous that it is not possible to enumerate them:’ see Salmar Holdings Pty Ltd v Hornsby Shire Council [1971] 1 NSWLR 192 at 203.”

f) then in H. Stanke & Sons Pty Ltd & Anor v. O’Meara [2007] SASC 246, in a judgment of the Full Court of the Supreme Court of South Australia, after embarking upon a detailed consideration of authority on whether by seeking declaratory relief, an applicant was seeking equitable relief; the Court said:

“There are other cases…. where the plaintiff’s case is founded upon equitable principles and the declaration is simply the device which gives effect to those principles.”

and then:

“Whilst it may be accepted that applications for mere declaratory relief cannot be regarded as seeking equitable relief, it is necessary to examine the pleadings in each case in order to determine the true nature of the relief sought.”

8. In this instance the underlying basis for the declaratory relief claimed is not in equity. It is based upon a breach of a contract of sale and upon the tort of fraud. After giving consideration to the above authority, in our view the relief claimed in the Originating Summons cannot be categorised as “other equitable relief” in s. 18 Frauds and Limitations Act and so the respondents’ claims do not come within the wording of s. 18 Frauds and Limitations Act. Given this it is now necessary to consider the first ground of appeal.

Whether s. 16 Frauds and Limitations Act applies

9. The appellants submit that there is no dispute that the subject contract of sale was signed on 20th August 1990 and the National Court proceeding was filed in September 2008 - a period of 18 years. Clearly, submit the appellants, the claim of the respondents is statute barred.

10. In his consideration of this issue the trial judge after referring to the case of Tau Gumu v. Papua New Guinea Banking Corporation (2001) N2288, stated at p18 that:

“It is apparent from the evidence of Mr. Onda Koim that the alleged fraud...