Rex Paki v Motor Vehicle Insurance Limited (2010) SC1015

• Jurisdiction: Papua New Guinea
• Court: Supreme Court
• Date: 09 February 2010
• Citation: (2010) SC1015
• Docket Number: SCA NO. 68 OF 2006
• Year: 2010

Full Title: SCA NO. 68 OF 2006; Rex Paki v Motor Vehicle Insurance Limited (2010) SC1015

Supreme Court: Salika DCJ, Gabi J, Hartshorn J

Judgment Delivered: 9 February 2010

APPEAL—Appeal against defence being struck out for failure to give discovery of documents—consideration of an award of costs on an indemnity basis

Facts:

The Appellant appealed the decision of the National Court that ordered that his defence be struck out and that damages be assessed as he had failed to give discovery of certain invoices. The appellant argues that once the Court had made a finding that the invoices did not exist it erred by then ordering that the defence be struck out for failure to give discovery of the same (non-existent) invoices.

Held:

1. The finding of Davani J. concerning the appellant’s conduct as to the discovery of the invoices, and Her ruling to strike out the defence was in the circumstances proper and appropriate and in the exercise of discretion under O9 r15 of the National Court Rules.

2. With respect to the Deed of Release, it has no relevance to the question of discovery. It is agreed that the appellant was required by law to maintain the invoices as part of the records of the liquidation for seven (7) years.

3. The actions of the appellant have caused the respondent an enormous amount of wasted time, effort and money. The conduct of the appellant was improper, unreasonable and blameworthy.

4. This appeal is dismissed

5. The decision of Davani J. to strike out Mr. Paki’s defence in proceedings WS No. 658 of 2002 is upheld

6. Pursuant to Order 9 Rule 15 of the National Court Rules judgment is entered for MVIL for damages to be assessed, plus interest and costs

7. Mr. Paki shall pay the costs of MVIL in respect of the National Court proceedings; and

8. Mr. Paki shall pay the costs of MVIL of these appeal proceedings on an indemnity basis, including any hearing as to quantum.

Cases cited:

PNG Cases

Aisip L Duwa v Ronald Moyo Senge [1995] PNGLR 140; Latham v Henry Peni [1997] PNGLR 435; Alina Sarah Bean v Ian Maxwell Bean [1980] PNGLR 307; Benny Balepa v The Commissioner of Police (1995) N1374; Bishop Brothers Engineering Pty Ltd v Ross Bishop (1989) N705; Don Pomb Polye v Jimson Sauk Papaki [2000] PNGLR 166; Gulf Provincial Government v Baimuru Trading Pty Ltd [1998] PNGLR 311; Island Helicopter Services Ltd v Wilson Sagati (2008) N3340; Jacob Sarapel v Fred Kulumbu (2003) N2405; Mision Asiki v Manasupe Zurenuoc (2005) SC797; Peter Aigilo v The Independent State of Papua New Guinea (2001) N2102; PNG Waterboard v Gabriel M Kama (2005) SC821; Public Officers Superannuation Fund Board v Sailas Imanakuan (2001) SC677; The Public Curator v BSP Ltd (2006) SC832; Salvation Army (PNG) Property Trust v Ivar Jorgensen and Rex Vagi (also known as Vevao Pyama) (1997) N1644; Thiess Bros (Pacific) Pty Ltd v Chief Collector of Taxes [1982] PNGLR 385; William Moses v Otto Benal Magiten (2006) SC875; William Mel v Coleman Pakalia (2005) SC790

Overseas Cases

Austrim Nylex Ltd v Knoll and Ors (No. 3) (2002) VSC 290; Holden & Co v Crown Prosecution Service [1990] 2 QB 262; Myers v Elman [1940] AC 282; Orchard v Southern electricity Board [1987] QB 565; P.C.R.Z. Investments Pty Ltd v National Golf Holdings Ltd & Anor (2002) VSCA 24; Ridehalgh v Horsefield [1994] 3 All ER 848; Sirois v Centennial Pontiac Buick GMC Ltd and General Motors of Canada Ltd (1988, 89) N.B.R. (2d) 244

9th February, 2010

1. BY THE COURT: This is an appeal from the decision of Davani J. delivered on 25th May 2006 whereby Her Honour ordered that the appellant’s defence be struck out and that damages be assessed.

2. The proceedings before Her Honour concerned an application by Motor Vehicle Insurance Limited, the respondent, to have the defence of Rex Paki, the appellant, struck out pursuant to Order 9 Rule 15(1) of the National Court Rules. In dealing with the question of the appellant’s failure to give discovery of certain invoices, Her Honour said:

“No doubt, the defendant’s inability to produce invoices is because he did not issue them. He was under an obligation to have kept invoices as records of the liquidation. He has not. Which (sic) means he did not issue any.” (Appeal Book (AB), page 274, line 10).

3. The appellant argues that once the Court made a finding that the invoices did not exist it was a mistake to order the defence be struck out for failure to give discovery of the same (non-existent) invoices.

4. The respondent concedes that Her Honour erroneously decided a matter of fact. As a result, it served on the appellant, a notice pursuant to Order 7 Rule 28 of the Supreme Court Rules that it does not seek to discharge or vary any part of Her Honour’s judgment. The respondent submits that the appellant maintained that he had the invoices and consented to the Court orders of 7th December 2004 requiring him to produce the invoices.

5. The issues are: (i) whether on the evidence this Court can come to the same conclusion as Her Honour but for different reasons; and (ii) if so, whether this Court should award costs of the appeal on an indemnity basis.

6. This appeal was heard on 27th June 2007 by Hinchliffe J, Salika J (as he then was) and Gabi J and the decision was reserved. Following the death of Hinchliffe J. before a decision had been given, the parties exercised their entitlement under section 3 of the Supreme Court Act to have the appeal re-heard. This is a re-hearing of the appeal.

Background

7. In order to appreciate the basis of the respondent’s application under Order 9 Rule 15 of the National Court Rules, it is necessary to set out the relevant factual matters in chronological order. The relevant background factual matters are not in dispute.

8. On 29th September 2000, the respondent was placed into liquidation and the appellant was appointed the liquidator of the respondent. On 9th April 2001, a Deed of Settlement and Indemnity (“the Deed”) was entered into between the parties. Clause 10 of the Deed provides that the appellant’s fees for the liquidation “will not exceed K690, 000” (subject to an entitlement to further payments in certain circumstances). On 17th May 2001, the liquidation was terminated and the appellant was discharged as liquidator of the respondent. The liquidation period lasted from 29th...