Infratech Management Consultancy v The State

• Jurisdiction: Papua New Guinea
• Judge: Polume-Kiele J
• Judgment Date: 18 June 2018
• Citation: (2018) N7368
• Court: National Court
• Year: 2018
• Judgement Number: N7368

Full : WS No 1467 of 2007; Infratech Management Consultancy v The Independent State of Papua New Guinea (2018) N7368

National Court: Polume-Kiele J

Judgment Delivered: 18 June 2018

N7368

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

WS NO. 1467 OF 2007

BETWEEN

INFRATECH MANAGEMENT CONSULTANCY

Plaintiff

AND

THE INDEPENDENT STATE OF PAPUA NEW GUINEA

Defendant

Waigani: Polume-Kiele J

2017: 5 July

2018: 18 June 2018

PRACTICE AND PROCEDURE - Assessment of Damages – Breach of Contract

Cases Cited

Papua New Guinea Cases

Coecon Limited (Receiver/Manager Appointed) v. National Fisheries Authority (2002) N2182

PNGBC v Jeff Tole (2002) SC694

William Mel v. Coleman Pakalia & The State (2005) SC790

Alex Awesa v Southern Highlands Provincial Government (2015) SC146

Teddy Suan v Peter Dumba (2013) N5428

Banduwara Waranumbo v Hyper Construction Limited (2012) N4882

William Mel v Coleman Pakalia (2005) SC990

Lagan –v- The State [1995] N1369

Boyd Construction v Sister Elizabeth Koai (2017) N6702

Yooken Paklin v The State (2001) N2212)

Albert Baine v The State (1995) N1335

Kopung Brothers Business Group v Sakawar Kasieng [1997] PNGLR 331

Peter Wanis v Fred Sikiot and The State (1995) N1350

Obed Lalip and Others v Fred Sikiot and The State (1996) N1457

MVIT v Tabanto [1995] PNGLR 214

Waima v MVIT [1992] PNGLR 254

MVIT v Pupune [1993] PNGLR 370

Tabie Mathias Koim and 28 Others v The State and Others [1998] PNGLR 247

Jonathan Mangope Paraia v The State (1995) N1343

Michael Buna v The State (2004) N2696

Rodao Holdings Ltd v Sogeram Development Corporation Ltd (2007) N5485

Kolaip Palapi and Others v Sergeant Poko and Others (2001) N2274

Tetley v The Administration (1971) No 647

Cheong Supermarket Pty Ltd v Pery Muro [1987] PNGLR 24)

Overseas Cases

Hadley v Baxendale (1854) 9 Exch 34

Victoria Laundry v Newman [1949] 2 KB 528

Counsel

Mr I Molloy, with Mr Terry Injia, for the Plaintiff

Mrs R Gela, for the Defendant

RULING

18 June, 2018

1. POLUME-KIELE J: This is a claim for assessment of damages for breach of contract. Trial on assessment of damages was conducted on the 5th of July 2017 following entry of default judgment on the 28 June 2008 for failure by the defendants to file a defence to the claim.

2. I now hand down my ruling on assessment of damages.

BACKGROUND FACTS

3. The Plaintiff was engaged by the Defendants to provide consultancy services pursuant to a contract entered into on the 23 of January 2003 for a term of 21 months. The value of the contract is in the sum of K2, 079,000.00. The contract commenced on or about 7th April 2003 and was to end on or about 29th July 2006.

4. This claim is for the outstanding sum of K8, 385,651.22 plus interest and costs. A total of 79 invoices were rendered for payment (paragraph 9 of statement of claim). The first Invoice No. 303001 was issued on the 7th of April 2003 for a total sum of K623, 700.00. The last Invoice No. 704002 dated 17th April 2007 was for a total sum of K227, 989.19. Between these two dates, various other monthly invoices (75) were rendered for payment. The statement of claim (paragraph 9) pleads breach of contract, for the delayed payment of the value of outstanding invoices in the sum of K11, 251, 270.34; of which a part-payment in the sum of K2, 865,619.12 was made by the Defendant. These claims are reproduced in Table 1

Table 1: Outstanding Invoices

3

221 particulars of which are disclosed as:

Table 1: Outstanding Invoices

Invoice No/Date	Schedule F8.2 Amount	Schedule F8.3 Exchange rate adjustment	Variations	Extension of time	Contract Interest	GST	Total	Comments
303001- 07/04/03	567,000.00	56,700.00	623,700.00	Mobilisation
303003/07/04/03	86,751.00	8,675.10	95,426.10
411001- 22/11/04	17,000.00	1,700.00	18,700.00	Bond glade Proposal review
411002- 30/11/04	144,667.27	14,466.73	159,134.00
411003-30/11/04	36,745.59	3,674.55	40,420.04
412001-31/12/04	144,667.27	14,667.73	159,134.00
412002-31/12/04	37,251.82	3,725.18	40,977.00
501001-27/01/05	144,667.27	14,466.73	159,134.00
501002-27/01/05	36,080.02	3,608.00	39,688.02
502001-28/02/05	140,000.00	14,000.00	154,000.00
502002-28/02/05	37,710.08	3,771.00	41,481.08
503001-31/03/05	139,221.82	13,922.18	153,144.00
503002-31/03/05	36,336.90	3,633.69	39,970.59
504001-29/04/05	138,444.55	13,844.45	152,289.00
504002-29/04/05	38,764.47	3,876.45	42,640.92
505001-31/05/05	66,889.09	6,889.91	73,578.00
505002-31/05/05	16,120.45	1,612.05	17,732.50
506001-30/06/05	66,889.09	6,688.91	73,578.00
506002-31/06/05	16,307.56	1,630.76	17,938.32
507001-31/07/05	38,889.09	3.888.91	42,778.00
507002-31/07/05	8,944.49	894.45	9,838.94
508001-31/08/05	35,000.00	66,820.00	10,182.00	112,002.00	Building Measure, Topo Survey
508002-31/08/05	21,962.57	2,195.26	24,158.83
509001-26/09/05	35,000.00	122,550.00	15,755.00	173,305.00	Marketing Study, Struct Reports
509002-26/09/05	34,345.90	3,434.59	37,780.49
510001-31/10/05	35,000.00	122,550.00	15,755.00	173,305.00	Marketing Study, Struct Reports
510002-31/10/05	32,177.84	3,217.78	35,395.62
510007-04/11/05	340,165.62	34,016.56	374,182.18	EOT 1 Approved by State Solicitor
510008-04/11/05	65,683.93	6,568.39	72,252.32
511001-30/11/05	27,221.82	81,700.00	10,892.18	119,814.00	Marketing Study, Struct Reports
511002-30/11/05	21,620.98	2,162.10	23,783.08
512001-07/12/05	27,221.82	81,700.00	10,892.18	28,180.25
512002-07/12/05	25,618.41	2,561.84	28,180.25
512003-07/12/05	151,477.52	15,147,75	151,477.52	Late payment interest contract
512004-07/12/05	35,627.51	3,562.75	39,190.26
601001-31/01/06	22,555.45	2,225.55	24,781.00
601001-31/01/06	4,759.20	475.92	5,235.12
602001-28/02/06	19,444.45	1,944.45	21,389.00
602002-28/02/06	3,175.30	317.53	3,492.60 4
602003-28/02/06	700,595.70	70,059.57	770,655.27	EOT 2
602009-28/02/06	114,407.28	11,440.73	125,848.01
603001-31/01/06	19,444.45	1,944.45	21,389.00
603002-31/03/06	2,621.13	262.13	3,492.60
604001-01/05/06	19,444.45	1,944.45	21,389.00
604002-01/05/06	3,988.08	398.81	4,386.89
605001-31/05/06	19,444.45	1,944.45	21,389.00
605002-31/05/06	4,017.24	401.72	4,418.96
606001-30/06/06	19,444.45	1,944.45	21,389.00
606002-30/06/06	3,671.13	367.11	4,038.24
606003-05/06/06	1,707,000.00	170,700.00	1,877,700.00	Prolongation Claim No.1
606004-05/06/06	391,585,58	39,158.58	430,744.16
606005-05/06/06	1,050,000.00	105,000.00	1,155,000.00	Variation No.7
606006-05/06/06	227,325.00	22,732.50	250,057.50
606007-05/06/06	141,000.00	14,100.00	155,100.00	Variation No.8
606008-05/06/06	32,895.30	3,289.53	36,184.83
606009-05/06/06	137,100.00	13,710.00	150,810.00	Variation No.9
606010-05/06/06	34,110.48	3,411.05	37,521.53
607001-31/07/06	19,444.45	1,944.45	21,389.00
607002-31/07/06	4,005.58	400.56	4,406.14
607005-31/07/06	478,973.41	47,897.34	526,870.75	WOD EOT 3
607006-31/07/06	88,274.80	8,827.48	97,102.28
608001-31/08/06	106,150.86	10,615.09	116,765.95	WOD EOT 4
608002-31/08/06	19,085.93	1,908.59	20,944.52
609001-30/09/06	77,671.36	7,767.14	85,438.50	WOD EOT 5
609002-30/06/06	14,975.04	1,497.50	16,472.54
610001-31/10/06	80,260.41	8,026.04	88,286.45	WOD EOT 6
610002-31/10/06	18,756.86	1,875.69	20,632.55
611001-30/11/06	77,671.36	7,767.14	85,438.50	WOD EOT 7
611002-30/11/06	19,930.47	1,993.05	21,923.52
612001-08/12/06	80,260.41	8,026.04	88,286.45	WOD EOT 8
612002-08/12/06	21,373.35	2,137.53	23,510.68
701001-31/01/07	80,260.41	8,026.04	88,286.45	WOD EOT 9
701002-31/01/07	19,174.21	1,917.42	21,091.63
702001-28/02/07	72,493.27	7,249.33	79,742.60	WOD EOT 10
702002-28/02/17	19,109.23	1,910.92	21,020.15
703001-31/03/07	80,260.41	8,026.04	88,286.45	WOD EOT 11
703001-31/03/07	23,700.90	2,370.09	26,070.99
704001-17/04/07	618,510.60	61,851.06	618,510.60	Interest claim # 2
704002-17/04/07	207,262.90	20,726.29	227,989.19
C/F Total	1,890,001.44	1,866,254.51	3,527,420.00	2,174,763.22	769,988.12	1,007,644.77	11,626,593.47

5. Due to the failure to pay, on the 24th of April 2007, a letter of demand and notice of a claim was given to the Solicitor General; this notice was acknowledged at about 3.45 p.m. by a Veronica Siri, Legal Secretary. Thereafter on the 18th of December 2007; a Writ of Summons was filed and served on the State on the 8th of January 2008. Acknowledgement of Service was received by Betty Makis, Senior Legal Secretary, Solicitor General’s Office at 9.46 a.m. The State however failed to file a defence by the requisite period prescribed under s 9 (i) (a) of the Claims By and Against the State Act 1996.

6. Default judgment was entered against the defendants on 28 June 2008.

Issues for determination

7. In order to determine what is an appropriate damages to be awarded, I view that the relevant matters for consideration are in relation to the following:

(i) Whether there are any outstanding payments due and payable to the Plaintiff on invoices rendered for payment?

(ii) If the answer is yes, whether it been proven on the balance...