Mountain Catering Ltd v Frederick Punangi

• Jurisdiction: Papua New Guinea
• Judge: Davani, Makail & Kassman, JJ
• Judgment Date: 28 March 2013
• Citation: (2013) SC1225
• Court: Supreme Court
• Year: 2013
• Judgement Number: SC1225

Full : SCM No 5 of 2011; Mountain Catering Ltd v Frederick Punangi, Secretary, Department of Defence and Bryan Kimmins as Chairman of and the Members of the Central Supply and Tenders Board and Patrick Pruaitch MP, Minister for Treasury and Finance and the National Executive Council and the Independent State of Papua New Guinea and NCS Holdings Ltd (2013) SC1225

Supreme Court: Davani, Makail & Kassman, JJ

Judgment Delivered: 28 March 2013

SC1225

PAPUA NEW GUINEA

[IN THE SUPREME COURT OF JUSTICE]

SCM NO 05 OF 2011

BETWEEN

MOUNTAIN CATERING LTD

Appellant

AND

FREDERICK PUNANGI, Secretary,

Department of Defence

First Respondent

AND

BRYAN KIMMINS as Chairman of and the Members of the CENTRAL SUPPLY AND TENDERS BOARD

Second Respondent

AND

PATRICK PRUAITCH MP, Minister for Treasury and Finance

Third Respondent

AND

THE NATIONAL EXECUTIVE COUNCIL

Fourth Respondent

AND

THE INDEPENDENT STATE OF PAPUA NEW GUINEA

Fifth Respondent

AND

NCS HOLDINGS LTD

Sixth Respondent

Waigani: Davani, Makail & Kassman, JJ

2012: 02nd March

2013: 28th March

JUDICIAL REVIEW – Review of decision on awarding of catering services contract – Contract for provision of catering services to Defence Force – Decision of Central Supply & Tenders Board – Secretary for Department of Defence expressing a view on awarding of contract – Excess of jurisdiction – Breach of tender procedures – Decision tainted with illegality – Reasonableness of decision – Error of law apparent – Defence Act, Ch 74 – Section 9(1)(b) – Public Finances (Management) Act, 1995 – Section 42(2).

PRACTICE & PROCEDURE – Objection to competency – Grounds of – Lack of pleadings – Alleged failure to plead decision subject of review – Objection raised at hearing of appeal – Discretionary – Prejudice – No prejudice shown – Objection heard and dismissed – Supreme Court Rules – O 7, r 14 – National Court Rules – O 16, rr 3 & 6.

PRACTICE AND PROCEDURE - primary judge ruling on competency issue - no appeal from ruling – attempt to raise same issue as an objection to competency on appeal – abuse of process – Supreme Court Act s.4 (appeal), Supreme Court Rules O7 rr27 & 28 (cross appeal).

Facts

The appellant was one of four companies which applied through public tender to provide catering services to the Papua New Guinea Defence Force. The second respondent awarded the contract to the sixth respondent and based on that decision, the fifth respondent entered into the contract with the sixth respondent. Aggrieved by that decision, the appellant sought review in the National Court. It alleged the first respondent altered or doctored a submission which favoured the sixth respondent contrary to section 42(2) of the Public Finances (Management) Act, 1995. It sought to quash that decision and compel the first respondent to provide a Tender Valuation Report to the second respondent to consider before making a final decision. The Court dismissed the proceedings, holding that the first respondent had overriding power to express a view on the awarding of a contract for the Defence Force pursuant to section 9(1)(b) of the Defence Act, Ch 74 and in the exercise of this power, validly expressed a view in favour of the sixth respondent.

Held

1. Where a respondent seeks to dismiss an appeal for being incompetent, O 7, r 14 of the Supreme Court Rules requires the respondent to file a notice of objection to competency within 14 days after service of the Review. However, the Court has discretion to hear an objection outside the time limit of 14 days.

2. In this case, the respondents did not file and serve a notice of objection to competency within 14 days of service of the Review. However, the appellant did not establish that it was prejudiced by the belated objection as the grounds were argued in the court below. The objection was heard together with the appeal.

3. Grounds ruled against by the primary judge cannot be raised again, except by appeal or cross appeal, and certainly not by Objection to Competency: section 4 (appeal) of the Supreme Court Act or O 7, rr 27 & 28 (cross-appeal) of the Supreme Court Rules.

4. The respondents did not appeal against the learned trial judge’s decision not to dismiss the Review for being incompetent. Therefore, that ruling stands and it is not open to challenge in any manner or form. Accordingly, the objection was dismissed.

5. Consideration of tenders and awarding of a catering services contract for the Defence Force are the sole and exclusive function of the second respondent pursuant to section 42 of the Public Finances (Management) Act, 1995, except where the second respondent co-opts or seeks advice from persons with specialized knowledge. Section 9(1)(b) of the Defence Act, Ch 74 has no application, thus the first respondent had no power to express a view on the awarding of a contract for the Defence Force to the second respondent.

6. Pursuant to section 16(d) of the Supreme Court Act, the appeal was upheld, the decision of the National Court quashed and the application for judicial review was granted with costs to be taxed if not agreed.

Cases cited:

Rose Kekedo -v- Burns Philip (PNG) Limited [1988-89] PNGLR 122

Sir Arnold Amet v. Peter Charles Yama (2010) SC1064

Counsel:

Mr R Bradshaw, for Appellant

Ms J Nandape, for the First, Second, Third, Fourth & Fifth Respondents

Mr R Pato with Mr R Manase, for Sixth Respondent

28th March, 2013

DECISION

DAVANI J & MAKAIL J: The appellant was one of four companies who applied through public tender to provide catering services to the Papua New Guinea Defence Force. The second respondent awarded the contract to the sixth respondent and based on that decision, the fifth respondent entered into the contract with the sixth respondent. Aggrieved by that decision, the appellant sought review in the National Court. It alleged the first respondent altered or ‘doctored’ a submission in favour of the sixth respondent and presented it to the second respondent contrary to section 42(2) of the Public Finances (Management) Act, 1995. The altered or ‘doctored’ submission formed the basis of the second respondent’s decision to award the contract to the sixth respondent. The second respondent then recommended to the third respondent to award the contract to the sixth respondent. The third respondent then presented a submission to the fourth respondent for endorsement. The fourth respondent endorsed it and a contract was executed between the fifth respondent and the sixth respondent.

2. In the Judicial Review in the National Court, the appellant sought among others, orders to quash that decision and compel the first respondent to provide a “Tender valuation report” to the second respondent to consider before making a final decision. This was because the first respondent had expressed a view in favour of the sixth respondent which was the basis for the second respondent’s decision to award the contract to the sixth respondent. The Court dismissed the proceedings, holding that the first respondent had overriding powers to express a view in relation to the awarding of a contract for the Defence Force, pursuant to section 9(1)(b) of the Defence Act, Ch 74.

3. In this appeal, the appellant seeks amongst other orders, an order to quash that decision.

Grounds of Appeal

4. The appellant raises seven grounds of appeal. These seven grounds raise three main issues. The first is in relation to the legality of the process by which the second respondent’s decision was made. The second is in relation to the reasonableness of the second respondent’s decision. The final issue relates to the allegations of fraud against the first respondent in altering or ‘doctoring’ the submission to favour the sixth respondent.

Objection to Competency – Alleged failure to plead second respondent’s decision

5. The respondents oppose the Review and ask that it be dismissed. A submission advanced by the respondents is that O 16, rr 3 & 6 of the National Court Rules requires an applicant to plead the relevant decision and grounds of review. In this case, the learned trial judge found that the relevant decision under review was the second respondent’s decision to award the contract to the sixth respondent. That finding is not challenged in this appeal. The appellant is effectively appealing the trial judge’s findings in relation to the first respondent and the Defence Council’s actions, the latter not being a party to the proceedings.

6. Secondly, the respondents submit that the appellant failed to plead that it will be relying on the “tender valuation report” in its contentions that the second respondent failed or did not consider it, before making the decision to award the contract to the sixth respondent. They submit further that although the appellant pleaded that the second respondent relied on a submission that was ‘doctored’ by the first respondent to enable it to award the contract to the sixth respondent, it failed to plead the doctored submission as the basis of the application for judicial review. For these reasons, they submit that this Review is incompetent.

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