National Fisheries Authority v New Britain Resources Development Limited and East New Britain Provincial Government and Independent State of Papua New Guinea; New Britain Resources Development Limited and East New Britain Provincial Government and Independent State of Papua New Guinea v National Fisheries Authority (2009) N4068

• Jurisdiction: Papua New Guinea
• Judge: Hartshorn J
• Judgment Date: 26 August 2009
• Court: National Court
• Citation: (2009) N4068
• Docket Number: WS 475 OF 2007
• Year: 2009
• Judgement Number: N4068

Full Title: WS 475 OF 2007; National Fisheries Authority v New Britain Resources Development Limited and East New Britain Provincial Government and Independent State of Papua New Guinea; New Britain Resources Development Limited and East New Britain Provincial Government and Independent State of Papua New Guinea v National Fisheries Authority (2009) N4068

National Court: Hartshorn J

Judgment Delivered: 26 August 2009

N4068

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

WS 475 OF 2007

BETWEEN:

NATIONAL FISHERIES AUTHORITY

Plaintiff/First Cross Defendant

AND:

NEW BRITAIN RESOURCES

DEVELOPMENT LIMITED

First Defendant/First Cross Claimant

AND:

EAST NEW BRITAIN PROVINCIAL

GOVERNMENT

Second Defendant/Second Cross Claimant

AND:

INDEPENDENT STATE OF PAPUA

NEW GUINEA

Third Defendant/Second Cross Defendant

Waigani: Hartshorn J.

2009: 21st April

: 26th August

Application to Amend Statement of Claim – Application to Dismiss Plaintiff’s claim for relief in proceeding – Order 12 Rule 40(1) National Court Rules

Facts:

1. New Britain Resources Development Limited (NBRDL) and the East New Britain Provincial Government (both referred to as Cross Claimants) entered into a contract with the State whereby it was agreed that NBRDL would construct a fish processing facility. The State agreed that when 75% of the first stage of the facility was built it would grant 20 fishing vessel licences to NBRDL. Although the necessary construction was completed, the licences were not issued. National Fisheries Authority (NFA) submits that parts of the Agreement are illegal or unenforceable and commenced this proceeding seeking amongst others, declarations to that effect. The Cross Claimants cross claimed against NFA seeking damages for breach of statutory duty and declaratory relief and against the State seeking damages for breach of contract. Judgment has been ordered against the State on the cross claim with damages to be assessed.

2. NFA now applies to amend it’s statement of claim and the Cross Claimants apply to have NFA’s claim for relief in the proceeding dismissed or struck out.

Held:

1. The doctrine of res judicata applies in this instance. NFA is bound on the determination of liability. NFA is in effect seeking to impugn the determination of liability already made in the proceeding. NFA cannot advance argument or adduce further evidence directed to showing that the issue of liability was wrongly determined.

2. There is no longer an issue between NFA and the Cross Claimants. The declaratory orders sought would have no practical utility.

3. NFA’s claim for relief in the proceeding is dismissed as an abuse of process.

Cases cited:

Papua New Guinea Cases:

Herman Gawi v. png Ready Mixed Concrete (1983) unnumbered, unreported, Bredmeyer J

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

Tolom Abai v. The State (1995) N1402

Titi Christian v. Rabbie Namaliu (1996) unreported OS No. 2 of 1995

Telikom PNG Ltd v. ICCC (2007) N3144, (2008) SC906

Yama v. PNGBC Ltd (2008) SC922

Overseas Cases:

Fidelitas Shipping Co. Ltd v. V/O Export-Chleb [1966] 1 Q.B. 630

The Russian Commercial and Industrial Bank v. British Bank for Foreign Trade Ltd [1921] 2 AC 438

Counsel:

Mr. A. W. Jerewai, for the Plaintiff/First Cross Defendant

Mr. I. R. Molloy and Mr. H. Leahy, for the First and Second Defendants/Cross Claimants

26th August 2009

1. HARTSHORN J. New Britain Resources Development Limited, East New Britain Provincial Government (Cross Claimants) and the State entered into an agreement to create an integrated fishing industry in East New Britain Province (Agreement).

2. Under the Agreement, New Britain Resources would construct a fish processing facility. The State agreed that when 75% of the first stage of the facility was built, New Britain Resources would be granted 20 fishing vessel licences. Although the necessary construction was completed, the licences were not issued.

3. The National Fisheries Authority (NFA) submits that parts of the Agreement are illegal or unenforceable and commenced this proceeding seeking amongst others, declarations to that effect.

4. The Cross Claimants cross claimed against NFA seeking damages for breach of statutory duty and declaratory relief and against the State seeking damages for breach of contract. Judgment has been ordered against the State on the cross claim with damages to be assessed.

5. NFA now applies to amend it’s statement of claim and the Cross Claimants apply to have NFA’s claim for relief in the proceeding dismissed or struck out.

Amendment to statement of claim

6. NFA seeks to amend its statement of claim by adding amongst others:

a) an alternative claim that even if the Agreement is legal and binding, NFA and the State are entitled to be discharged from obligations under it as New Britain Resources failed to perform conditions precedent.

b) that the whole of the Agreement be rescinded and that the parties thereto be discharged from all obligations.

7. NFA submits that the alleged non-compliance by New Britain Resources with pre-conditions became apparent during the course of this proceeding and that many of the pre-conditions allegedly not met are requisites for fishing licences. These matters should be allowed to be pleaded, it is submitted, for the purpose of determining the real questions raised by the proceedings and to avoid a multiplicity of proceedings.

8. The Cross Claimants submit that the application to amend the statement of claim should be refused and NFA’s proceeding should be dismissed or struck out as:

a) NFA has no standing to obtain any relief including the proposed amendment.

b) the issues raised by NFA in the original and proposed statement of claim are res judicata and are now of academic interest only.

9. I will consider the res judicata question first.

Res judicata

10. The Cross Claimants submit that NFA participated in the Cross Claimants successful application for summary judgment against the State and that judgment creates a res judicata as to liability under the Agreement.

11. NFA submits that as judgment was only against the State on the cross claim, there is no res judicata created in respect of the relief that NFA is seeking, which is amongst others, to have the Agreement declared illegal and unenforceable.

12. Res judicata is a legal doctrine recognized in Schedule 2.8(1)(d) Constitution, and has been considered in numerous cases in this jurisdiction including; Herman Gawi v. png Ready Mixed Concrete (1983) unnumbered, unreported, Bredmeyer J., Titi Christian v. Rabbie Namaliu (1996) unreported OS No. 2 of 1995, Tolom Abai v. The State (1995) N1402, Telikom PNG Ltd v. ICCC (2007) N3144, (2008) SC906, Yama v. PNGBC Ltd (2008) SC922.

13. A description of the rule as to res judicata is, “…where an action has been brought and judgment has been entered in that action, no other proceedings may be maintained on the same cause of action”: Halsbury’s Laws of Australia, para [190-45].

14. The present case concerns a claim of res judicata in the same proceeding in which judgment has been entered as opposed to a claim of res judicata in subsequent proceedings to those in which judgment was entered.

15. As to such a case as the present, Lord Diplock L.J. in Fidelitas Shipping Co. Ltd v. V/O Export-Chleb [1966] 1 Q.B. 630 at p. 642 said:

“Where the issue separately determined is not decisive of the suit, the judgment upon that issue is an interlocutory judgment and the suit continues. Yet I take it to be too clear to need citation of authority that the parties to the suit are bound by the determination of the issue. They cannot subsequently in the same suit advance argument or adduce further evidence directed to showing that the issue was wrongly determined.”

16. Here, the summary judgment against the State determined that the State was liable to the Cross Claimants for breach of the Agreement and that damages are to be assessed. At the hearing for summary judgment there was representation and...