Network Construction Limited and Benny Kusak Wappi v The Independent State of Papua New Guinea (2010) N4045

• Jurisdiction: Papua New Guinea
• Judge: Hartshorn, J
• Judgment Date: 04 May 2010
• Court: National Court
• Citation: (2010) N4045
• Docket Number: WS 823 OF 2009
• Year: 2010
• Judgement Number: N4045

Full Title: WS 823 OF 2009; Network Construction Limited and Benny Kusak Wappi v The Independent State Of Papua New Guinea (2010) N4045

National Court: Hartshorn, J

Judgment Delivered: 4 May 2010

N4045

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

WS 823 OF 2009

BETWEEN:

NETWORK CONSTRUCTION LIMITED

First Plaintiff

AND:

BENNY KUSAK WAPPI

Second Plaintiff

AND:

THE INDEPENDENT STATE OF PAPUA NEW GUINEA

Defendant

Waigani: Hartshorn, J.

2010: 14th April,

: 4th May

Consent Order - Application to set aside - s. 155(4) Constitution

Facts:

The State applies to have a consent order of this court set aside and for other consequential orders. The Plaintiffs oppose the application and seek to have the State’s notice of motion dismissed on the grounds that any allegation that the Consent Order was obtained by fraud or misrepresentation should be rejected as no particulars have been provided, that there is no error on the face of the record or any procedural irregularity, and that all customary procedures were followed in obtaining and entering the Consent Order.

Held:

1. This Court has the inherent power under s. 155(4) Constitution to set aside a consent order even when it is a final order and determines the relief sought: Simon Mali v. The State (2002) SC690.

2. The power to set aside a consent order can be exercised in at least two situations: (1) where there are errors on the face of the Court’s record; and (2) where there are procedural irregularities associated with the consent order being obtained.

3. There was procedural irregularity in obtaining the Consent Order as the Solicitor-General did not have instructions from the Attorney General to settle this proceeding: Polem Enterprises Ltd v. Attorney General of Papua New Guinea Mr. Francis Damen (2008) SC911, applied. The consent order is set aside.

Cases cited:

Papua New Guinea Cases

Pius Nui v. Senior Seargeant Mas Tanda (2004) N2765

Polem Enterprises Ltd v. Attorney General of Papua New Guinea Mr. Francis Damen (2008) SC911

Simon Mal v The State (2002) SC690

Simon Mali v The State (2008) N3442

The State v. Zachary Gelu and Anor (2003) SC716

Overseas Cases:

Harvey v. Phillips [1956] HCA 27

Permanent Trustee Co (Canberra) Ltd v. Stocks & Holdings (Canberra) Pty Ltd (1976) 28 FLR 195

Sheonandan Prasad Singh v. Abdul Fateh Mohammad Reza (1935) 62 Ind App 196

Waitemata City Council v. MacKenzie [1988] 2 NZLR 242

Counsel:

Mr. S. Javati, for the Plaintiffs

Mr. W. Mapiso, for the Defendant

14th April, 2010

1. HARTSHORN, J: The State applies to have the consent order of this court ordered and entered on 26th November 2009 (Consent Order) set aside and for other consequential orders.

2. The grounds relied upon by the State are that:

a) this court has jurisdiction to set aside a consent order,

b) there are errors on the face of the court's record,

c) there are procedural irregularities as to how the Consent Order was obtained.

3. The Plaintiffs oppose the application and seek to have the State’s notice of motion dismissed on the grounds that:

a) any allegation that the Consent Order was obtained by fraud or misrepresentation should be rejected as no particulars have been provided,

b) there is no error on the face of the record or any procedural irregularity,

c) all customary procedures were followed in obtaining and entering the Consent Order.

4. The Consent Order is as follows:

“1. Judgment is entered against the State to pay the First Plaintiff the amount of K1,998,355.08 being for mobilization fee for the construction of the Wewak Court House Complex Project.

2. The Plaintiffs are to discontinue the proceeding and resume work on the construction of the Wewak Court Complex Project as soon as the mobilization fee is paid.

3. Cost to the Plaintiffs if not agreed to be taxed.”

5. The draft of the Consent Order that was handed to the presiding judge was signed by Mr. S. Javati, Counsel for the Plaintiffs and Mr. Devete, the Solicitor General, for the State. The Consent Order was ordered and entered on 26th November 2009 although there was no order for abridgement of time.

Law

6. This Court has the inherent power under s. 155(4) Constitution to set aside a consent order even when it is a final order and determines the relief sought: Simon Mali v. The State (2002) SC690. This power can be exercised in at least two (2) situations; where there are errors on the face of the Court’s record and where there are procedural irregularities associated with the consent order being obtained. I exercised this power to set aside a consent order in Simon Mali & Ors v. The State (2008) N3442. I also refer to the decision of Cannings J. in Pius Nui v. Senior Seargeant Mas Tanda (2004) N2765. Given the above, I am satisfied that this court has jurisdiction to hear this application.

Procedural irregularity

7. I will consider whether there was any procedural irregularity associated with the obtaining of the consent order, first.

8. In the affidavit of Mr. Devete, the Solicitor General of Papua New Guinea, sworn on 24th March 2010, Mr. Devete deposes amongst others, to the circumstances that led to him signing the draft consent order and that he signed the draft consent order relying on the advice of a lawyer in his office who had carriage of the matter.

9. In the affidavit of Mr. Javati, counsel for the Plaintiffs, sworn 31st March 2010, Mr. Javati deposes amongst others, that as to the second order of the Consent Order,

“I was advised by Ms. Tiankin that those were the express instructions of the State Solicitor, Mr. Minjihau and Mr. Kimmins who were instructing Ms. Tiankin.”

10. From this it can be deduced that Mr. Devete relied upon the advice of Ms. Tiankin to sign the draft consent order and that Ms. Tiankin was being instructed by the State Solicitor and Mr. Kimmins.

11. Nowhere in his affidavit does Mr. Devete depose that he received instructions from the Attorney General of Papua New Guinea to settle this proceeding or that he had any communication with the Attorney General concerning the matter.

12. The effect of the Consent Order is to settle the proceeding with judgment being entered against the State, the First Plaintiff being paid a mobilisation fee, the proceeding being discontinued and the Plaintiffs resuming construction of the Wewak Court Complex.

13. As to the roles and functions of the Solicitor General and the Attorney General, the law is settled. In the Supreme Court case of The State v. Zachary Gelu and Anor (2003) SC716, at page 12 the Court said;

“In practice, where the State is a party in any litigation before the courts, the SG (Solicitor General) may act as an advocate if instructed to do so by the AG (Attorney General) in accordance with s.13(2) of the Attorney-General Act. Where the SG is instructed, he must act in accordance with the instructions of the AG, such as to settle or not to settle a matter.”

14. Then in Polem Enterprises Ltd v. Attorney General of Papua New Guinea Mr. Francis Damen (2008) SC911, the Supreme Court said that as to the Gelu case (supra):

“It is good law. It is clear that the Solicitor-General has no power to settle cases against the State except on the instructions of the Attorney General……… the Solicitor-General must have instructions from the Attorney-General before settling a case.”

15. Given the evidence of Mr. Devete and Mr. Javati to which I have been referred, I am satisfied that Mr. Devete did not have instructions from the Attorney General to settle this proceeding. As the Consent Order effectively settled this proceeding and Mr. Devete signed the draft consent order without the authority of the Attorney General, I am satisfied that there was procedural irregularity associated with the obtaining of the Consent Order.

16. What has occurred here is similar to the fact situation in Mali (2008) (supra). My observations in that case are relevant here. I made reference to the case of Harvey v. Phillips [1956] HCA 27, a decision of the High Court of Australia, where;

“a compromise has been agreed upon by counsel acting….. in excess of some limitation that has been expressly placed on his authority”

17. In Harvey's case (supra) reference was made to the judgment of Lord Atkin in Sheonandan Prasad Singh v. Abdul Fateh Mohammad Reza (1935) 62 Ind App 196, where he said that in such cases;

“In the first instance the authority (of counsel) is an actual authority implied from the employment as counsel. It may however be withdrawn or limited by the client; in such a case the actual authority is destroyed or restricted and the other party if in ignorance of the limitation could only rely upon ostensible authority. In this particular class of contract, however, the possibility of successfully alleging ostensible authority has been much restricted by the authorities such as Neale v. Gordon Lennox (1902) AC 465 and Shepherd v. Robinson (1919) 1 KB 474, which make it plain that if in fact counsel has had his authority withdrawn or restricted the Courts will not feel bound to enforce a compromise made by him contrary to the restriction, even though the lack of actual authority is not known to the other party”

18. Lord Atkin went on to say that;

“It is said that this power of the courts is to be exercised as a matter of discretion when in the circumstances of the...