J A Construction v Ipisa Wanega and Hona Javati and Eastern Highlands Provincial Government (2010) SC1069

• Jurisdiction: Papua New Guinea
• Judge: Batari J, David J, Ellis J
• Judgment Date: 03 September 2010
• Court: Supreme Court
• Citation: (2010) SC1069
• Docket Number: SCA 1 of 2008
• Year: 2010
• Judgement Number: SC1069

Full Title: SCA 1 of 2008; J A Construction v Ipisa Wanega and Hona Javati and Eastern Highlands Provincial Government (2010) SC1069

Supreme Court: Batari J, David J, Ellis J

Judgment Delivered: 3 September 2010

SC1069

PAPUA NEW GUINEA

[IN THE SUPREME COURT OF JUSTICE]

SCA 1 of 2008

BETWEEN

J A CONSTRUCTION

Appellant

AND:

IPISA WANEGA

First Respondent

HONA JAVATI

Second Respondent

EASTERN HIGHLANDS PROVINCIAL GOVERNMENT

Third Respondent

Waigani: Batari J, David J, Ellis J

2010: 30 August, 3 September

JUDGMENT

Failure to give notice of claim against Provincial Government – Claims By and Against the State Act, section 5

Whether decisions of the Supreme Court operate with retrospective effect

Cases cited:

Papua New Guinea Cases

Antonius v Yaninen (2004) N2774

Federal Huron v OK Tedi Limited [1986] PNGLR 5

Pato v Enga Provincial Government [1995] PNGLR 469; N1340

Polem Enterprise Ltd v Attorney-General [2008] PGSC 9; SC911 (2 May 2008)

Pupune v Makrai and PNGBC [1997] PNGLR 22

Ruta v EHPG [1998] PNGLR 157

SCR1 of 1998 [2001] PGSC 8; SC672 (8 November 2001)

State v Manoburn Earthmoving Ltd (2003) SC716

Tohian v Liu (1998) SC 566

Tried Pacific (PNG) Ltd v EHPG (2004) WS 1052 of 200

Overseas Cases

A v Governor of Arbour Hill Prison [2006] IESC 45

Brennan v Bolt Burden [2004] EWCA Civ 1017

Counsel:

C Narokobi, for the Appellant

There was no appearance for the Respondents

1. BY THE COURT: BACKGROUND: This appeal raises the question of whether the Appellant’s claim against the 3rd Respondent should fail because no notice was given pursuant to section 5 of the Claims By and Against the State Act (CBASA).

2 The Appellant was alleged to have been contracted by the 3rd Respondent, namely the Eastern Highlands Provincial Government, to undertake construction work on toilet and shower blocks at the Goroka Demonstration High School for K52,000. Despite the fact that the dispute was clearly between Appellant and the 3rd Respondent, the school’s Principal and the Chairman of the school’s Board of Governors were also sued. Those two Respondents did not participate in this appeal.

3 The Statement of Claim alleged that five part payments were made but only particularised four such payments which totalled K28,880.07. The Appellant claimed that, as a result of a substantial increase in the cost of building materials, a revised quotation which sought to increase the contract sum from K52,000 to K66,000 was submitted. Despite not pleading any agreement to that increased contract sum, the Appellant claimed not the K23, 119.93 difference between what was paid (K28,880.07) and the contract sum (K52,000) but the K37,119.93 difference between what was paid (K28,880.07) and the revised quotation (K66,000.00).

Chronology

4 From the documents contained in the Appeal Book, the following chronology may be constructed:

27 May 98 3rd Respondent accepted Appellant’s quotation

21 Jul 99 Writ of Summons filed

18 Aug 00 Order for default judgment obtained against Respondents

08 Nov 01 Judgment in SCR1 of 1998 made it clear that the term “State” includes Provincial Government

01 Apr 03 Notice of Motion filed by Appellant, seeking an order that the Respondent pay the Appellant damages

22 Apr 03 Appellant’s current lawyer filed a Notice of Appearance

25 Apr 03 Respondents ordered to pay K37,119.93 plus interest

03 Jun 03 White Young & Williams filed a Notice of Change of Lawyers for the Respondents

27 Oct 04 O’Briens filed Notice of Change of Lawyers for the 3rd Respondent

31 Jan 05 The 3rd Respondent filed a Motion to have the orders of 22 Aug 2000 and 11 Jun 03 set aside and the action dismissed

18 Apr 05 Amended Notice of Motion filed adding an alternative claim for leave to file a defence out of time

01 Sep 05 Motion of 18 Apr 05 withdrawn

06 Nov 06 Appellant’s motion to have matter set down for assessment

14 Dec 06 Matter listed for 14 Feb 07

13 Mar 07 3rd Respondent’s Motion to set aside default judgment for failure to comply with section 5 of the CBASA

09 Nov 07 Hearing of 3rd Respondent’s Motion

29 Nov 07 Judgment delivered, dismissing the proceedings and ordering the Appellant to pay the 3rd Respondent’s costs

07 Jan 08 Notice of Appeal filed

Transcript of hearing

5 From the transcript of the hearing of the 3rd Respondent’s motion on 9 November 2007, it is clear that there was no issue between the parties that the Appellant had not complied with section 5 of the CBASA. At that hearing, the question of whether the decision of the Supreme Court, delivered on 8 November 2001, in SCR1 of 1998 [2001] PGSC 8; SC672 had retrospective effect was argued. Reference was made to the decision in Federal Huron v OK Tedi Limited [1986] PNGLR 5. It was suggested that the question of whether there had been compliance with section 5 should not be entertained because of the 1 September 2005 withdrawal of the 18 April 2005 Notice of Motion.

6 In paragraph 14 of the judgment (on page 10 of the judgment and page 159 of the Appeal Book) it was noted that the Appellant’s lawyer “did write to the Solicitor-General seeking an extension of time to give notice but the application was refused because the [Appellant] did not show cause why notice was not given within the prescribed time limit”. It was also observed that, following that refusal, no application for an extension of time was made to the Court, under section 5(2)(c)(ii) of the CBASA. In other words, despite being aware of the section 5 issue, and despite being able to suggest that an extension should be granted because the position in relation to claims against a Provincial Government was not made clear until 8 November 2001, the Appellant’s lawyers did nothing. No application was made to either the Attorney-General or to the National Court for an extension of time at any time during the 8 year period from 8 November 2001 to 29 November 2009 when the judgment the subject of this appeal was delivered.

Judgment of the National Court

7 The learned trial judge noted that the question of whether section 5 of the CBASA applied to Provincial Governments had been considered in judgments delivered prior to the Writ of Summons being filed on 21 July 1999, such as Pato v Enga Provincial Government [1995] PNGLR 469, Pupune v Makrai and PNGBC [1997] PNGLR 22 and Ruta v EHPG [1998] PNGLR 157, which it was said should have alerted the Appellant’s lawyer to the question of whether a section 5 notice should be given.

8 It was correctly noted that, after the Supreme Court’s decision in 2001, the Appellant’s lawyers could have taken steps to rectify the non-compliance with section 5 of the CBASA.

9 The learned trial judge quoted from Halsbury’s Laws of England, 4th edition, volume 44(1) at paragraph 1283:

An amending enactment is generally presumed to change the relevant law only from the time of the enactment’s commencement. In the absence of a clear indication of a contrary intention in an amending enactment, the substantive rights of the party to an action thus fall to be determined by the law as it existed when the action was commenced, and this is so whether the law is changed before the hearing of the case at the first instance or while an appeal is pending. However, an amending enactment may say expressly or by implication that its effect is to be retrospective.

A declaratory enactment, since it does not change the relevant law, operates form the commencement of that law (where it is statute law) or from an indefinite time (where it is the common law or other enacted law).

10 The learned trial judge noted that the Appellant’s lawyer had been aware of the section 5 issue since 2004 and that was evident from the application to the Solicitor-General for an extension of time. It was also noted that the requirement to give notice was a condition precedent: Tohian v Liu (1998) SC 566.

Grounds of appeal

11 The decision of the learned trial judge to dismiss the proceedings for failure to comply with section 5 of the CBASA was challenged on a number of grounds. Those grounds may be summarised as follows:

(1) at the time these proceedings commenced, there was no law which stated that notice pursuant to section 5 was required prior to suing a Provincial Government;

(2) the decision in the Federal Huron case did not apply to this case;

(3) the issue of whether a section 5 notice was required was res judicata since that point had been previously been decided in the Appellant’s favour in that the 3rd Respondent had conceded that a section 5 notice was not required in this case;

(4) it was not open to the 3rd Respondent to contest the failure of the Appellant to file a section 5 notice since the Appellant had already obtained a default judgment; and

(5) The CBASA is unconstitutional, in whole or in part, since it does not comply with section 38 and 39 of the Constitution.

Appellant’s submissions

12 The document headed “Extract of Submission” provided little assistance to the Court. That document included a suggestion that the CBASA “came into operation after the proceeding was filed” despite the fact that the CBASA was passed in 1996 and the Writ of Summons was not filed until 21 July 1999. That document concluded by seeking an order for the 3rd Respondent to pay K230,047.81 with interest. The contents of document headed “Appellant’s Submission” are considered...