Ace Guard Dog Security Services Limited and Yama Security Services Limited v Lindsay Lailai Acting Managing Director and Telikom (PNG) Limited (2003) N2459

JurisdictionPapua New Guinea
CourtNational Court
Citation(2003) N2459
Date05 September 2003
Year2003

Full Title: Ace Guard Dog Security Services Limited and Yama Security Services Limited v Lindsay Lailai Acting Managing Director and Telikom (PNG) Limited (2003) N2459

National Court: Sakora J

Judgment Delivered: 5 September 2003

1 PRACTICE AND PROCEDURE—Notice of Discovery—Default—Extensions of time—List of documents filed out of time—Inadequacy of Discovery—Criterion for discoverability—Restrictions on discoverability—National Court Rules, O9, r1, r2, r5, r6, r9 and r15(1).

2 PRACTICE AND PROCEDURE—Pleadings—Principles and Purposes of—Discovery—Notice of—Powers upon Default—Discretionary—National Court Rules, O9, r15(1).

3 Hornibrook Constructions Pty Ltd v Kawas Express Corporation Pty Ltd [1986] PNGLR 301, Credit Corporation (PNG) Ltd v Gerald Jee [1988–89] PNGLR 11, Wenam Elkum v The Independent State of Papua New Guinea [1988–89] PNGLR 662, Aisip L Duwa v Ronald Moyo Senge [1995] PNGLR 140, Public Officers Superannuation Fund Board v Sailas Imanakuan (2001) SC677, Flight v Robinson (1844) 8 B 22, Compagnie Financiere et Commerciale du Pacifique v Peruvian Guano Co (1882) 11 QBD 55 (CA), Mulley v Manifold (1959) 103 CLR 341, Donaldson v Harris and Hamood (1973) 4 SASR 299 and Commonwealth v Northern Land Council (1993) 176 CLR 604 (HC) referred to

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Sakora J: On 20 May 1999 Yama Security Services Limited (YSS) and Ace Guard Dog Security Services Limited (Ace) entered into contracts to provide security services to Telikom (PNG) Limited (Telikom). On 31 August 1999 Telikom terminated the contracts alleging they were fraudulently and illegally obtained.

YSS and Ace sued Telikom claiming damages for breach of contract, particularly for services rendered and for payment for the 33 months remaining on the two contracts. YSS and Ace claimed K6,114,598.62 and K4,526,280.00 respectively. On 5 December 2000 they each obtained default judgment on liability, with quantum to be assessed.

Telikom appealed to the Supreme Court and the appeal was allowed in respect of the two judgments on 6 May 2003, with the matters remitted to the National Court for substantive hearing on both liability and quantum.

The defendant company has two applications before me pursuant to the two Notices of Motion both filed 2 July 2003 in respect of the two plaintiffs (YSS and Ace). Both applications are said to be made pursuant to O9, r15 of the National Court Rules (the Rules) which makes provisions for Default in respect of the rules for Discovery and Inspection of Documents. The rule is in the following terms:

15. Default

(1) Where a party makes default in filing or serving a list of documents or affidavit or other document, or in producing any document as required by or under this Division, the Court may make such order as it thinks fit, including—

(a) if the party in default is a plaintiff, an order that the proceedings be stayed or dismissed as to the whole or any part of the relief claimed by him in the proceedings; or

(b) if the proceedings were commenced by writ of summons and the party in default is a defendant, an order that his defence be struck out and that judgment be entered accordingly.

(2) . . .

(3) . . ."

Factual Background

It is the applicant/defendant's case that there has been default on the part of the two plaintiff companies in compliance with the procedural rules under the National Court Rules in relation to discovery of documents. And the failure or default is said to be on both substance and form. For this contention Mr Anderson of counsel for the applicant refers the Court to and relies upon the following affidavits:

· sworn by Tiffany Gaye Nonggorr on 2 July 2003 and filed of even date.

· sworn by Tiffany Gaye Nonggorr on 17 July 2003 and filed of even date.

The first affidavit deposes to the circumstances relied on to assert that the plaintiffs had not complied with the defendant's Notice of Discovery. The second affidavit deposes to further circumstances relied on in support of the defendant's assertion and Notice of Motion. The pertinent documents in support have been duly annexed to the affidavits.

It would appear from the two affidavits filed on behalf of the defendant (supra) that the defendant had filed on its behalf in the National Court a Notice of Discovery on 10 November 2000 in respect of the two proceedings (about a month before the plaintiffs obtained default judgment on liability on their respective claims on 5 December 2000). This notice was filed by Tamutai Lawyers who acted for the defendant until change of lawyers (pursuant to a Notice of Change of Lawyers filed 16 May 2003 by Gadens Lawyers). It would appear also that three sets of Notices of Intention to Defend had been filed by the three lawyers for the defendant who seemed to have been acting simultaneously (on 9, 10 and 15 December 1999 respectively) until Tamutai Lawyers were accorded exclusive instructions by 13 January 2000. It would further appear that Request for Further and Better Particulars (dated 14 December) were filed 15 December 1999.

The defendant's Defence in one and Defence and Counter–Claim in the other claim were filed on 16 March 2000. The plaintiffs' Answers to Request for Further and Better Particulars were filed on 2 March 2000. Four months later (12 July 2000) they had filed their Notice to Produce Further and Better Particulars in relation to the allegations made in the defendant's Defence.

On 23 August 2000 the plaintiffs filed applications to have default judgments entered against the defendant (alternatively summary judgment) contending the following:

· The defendant had failed to verify its Defence;

· No defence had been disclosed; or

· The defendant be ordered to furnish its Further and Better Particulars.

The two applications were heard and refused on 21 September 2000. And as noted already, without complying with the Notice of Discovery that had been served in November 2000, the plaintiffs proceeded to apply for and obtain judgment on liability on 5 December 2000, with quantum to be assessed.

After the successful appeal (supra), and in the light of the continuing non–compliance with the Notice of Discovery since November 2000, the defendant through its new lawyers (Gadens) filed fresh Notices of Discovery in respect of the two actions on 16 and 19 May 2003 respectively. The notices required Discovery with verification within 15 days of service, and thus the time limited for the plaintiffs to furnish Lists of Documents expired Monday 2 June 2003 (31 May falling on a week–end).

It appears further from the affidavit of Tiffany Gaye Nonggorr (the one sworn 2 July 2003) that on 28 May 2003 the lawyers for the plaintiffs wrote to the defendant's lawyers seeking extension of time for a further 14 days within which to respond to the Notices of Discovery. The defendant's lawyers acceded to the request for extension of time, which extension lapsed at close of business Monday 16 June 2003 without the plaintiffs availing of the extended opportunity as indicated in their request.

On 20 June 2003 the defendant's lawyers caused a letter to be delivered to the plaintiffs' lawyers advising of the expiry of the extended time and giving notice that if there was further failure to provide Discovery within 7 days (of the letter) the defendant would be making an application to the Court to order the entry of judgment against the plaintiffs. This further extension of time came and went on 27 June 2003, without the plaintiffs complying with the Notices of Discovery, the defendant contends.

In her 17 July 2003 affidavit Mrs Nonggorr deposes that on 2 July 2003 the defendant's lawyers were served with a List of Documents and an Amended List of Documents which did not show the filing date on the face of those documents. Subsequently attending at the National Court Registry on 14 July 2003 Mrs Nonggorr conducted a search of the file which indicated that no List of Documents had ever been filed, though the Amended List of Documents was shown (on the file index) to have been filed on 2 July 2003.

The plaintiffs oppose the defendant's application (Notice of Motion filed and served on 2 July 2003). In support of their opposition they have had sworn and filed on their behalf one affidavit...

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