Kundu Consultants Limited v The Independent State of Papua New Guinea (2001) N2128

• Jurisdiction: Papua New Guinea
• Court: National Court
• Judge: Lenalia J
• Judgment Date: 25 May 2001
• Citation: (2001) N2128
• Judgment Number: N2128
• Year: 2001

Full Title: Kundu Consultants Limited v The Independent State of Papua New Guinea (2001) N2128

National Court: Lenalia J

Judgment Delivered: 25 May 2001

N2128

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

OS. NO. 749 OF 2000

BETWEEN:

KUNDU CONSULTANTS LIMITED

- Plaintiff/Respondent

AND:

THE INDEPENDENT STATE OF PAPUA NEW GUINEA.

- Dependant/Applicant

WAIGANI: LENALIA, J.

2001: 21, 25 May

Practice and Procedure — Trial date set for assessment — Damages —

Default Judgment — Default judgment entered on failure to file defence — Application to set aside struck out.

Practice and Procedure — Assessment of Damages — Trial date set —

Motion to dismiss for defective pleadings or to set aside — Defence on the merit — Whether affidavit shows defence on the merit — Principles — Defence on the merit.

CASES CITED

The following cases are cited on judgment.

Green and Co. Pty. Ltd -v- Green [1976] PNGLR. 73

Barker -v- The Government of Papua New Guinea [1976] PNGLR. 340

The Government of Papua New guinea and Davies -v- Barker [1977] PNGLR. 386

George Page Pty Ltd -v- Malipu Bus Balakau [1982] PNGLR. 140

G. Toop, for the Plaintiff/Respondent

D. Lambu, for the Defendant/Applicant

25 May, 2001

LENALIA, J. This matter was not listed for trial on the 7 of this month, however Messrs. Toop and Kua brought it up before me submitting that due to the urgency of the matter and due to the fact that default judgment had been entered and since trial on damages would only been very brief, they indicated they wanted to proceed if time permitted the Court. I indicated to the lawyers that, the listing and been done and I was proceeding according to the cases that had been set. I indicated however that if the case set for trial on 21 of this month fell through, the lawyers should then bring this matter up. The case set for trial on that date fell through and this case was again brought to my attention.

Quite surprisingly to the Court, when the lawyers appeared on 21 May, their former submissions were not followed and diverted to arguing two motions. The first one being filed by the Solicitor General for and on behalf of the State and a Cross-Motion by the Respondent/Plaintiff. The Applicant filed the Notice of Motion on 16th of this month seeks the following orders:-

"1. Plaintiffs cause of action be dismissed for

(a) non disclosure of a reasonable cause of action pursuant to Order 8 Rule 27 (1)(a) of the National Court Rules.

(b) the action is prevented by the doctrine of "Res Judicata".

(c) Duplicity.

2. In the alternative the order of 18th of August 2000

be set aside and leave be granted to the Defendant/Applicant to file it's Defence out of time.

By a Cross Motion, the Plaintiff's lawyers filed a cross-motion on 18th May, 2001 seeking orders that:-

"1. The Defendant's motion be struck out on the grounds it is an abuse of the process, misconceive and vexatious.

2. The Defendant pay the Plaintiff's costs of this application.

3. Any other order/s deemed necessary by this Honourable Court."

The two motions were argued together. In order to fully comprehend the nature of the two notice of motions, I set out in brief some chronological events which took place from the time the Writ of Summons NO. 749 of 2000 was filed. The Plaintiff took out an action against the State for maritime services rendered to the State and it's servant engaged in the Bougainville uprising between 1993 and 1996 following failure by the Defendant to honour the contract entered into between the Plaintiff and the Defendant through its servants, the Plaintiff took out an action against the Defendant WS. No. 268 of 1997 on which Woods, J. ordered the Defendant to pay the Plaintiff a sum of K182,200.00 together with costs and interest was well over K200,000.00.

On the current action WS No. 749 of 2000, the Plaintiff claims that certain invoices Nos. 100001 to 100043 and 200001 to 200036 related to the supply of marine service by their two vessels, "Buka Princess, Buka 1 and Buka 2" for the period from 15th of May 1993 to 15th of May 1996. The total amount claimed for that period is K6,571 000.00 according to the plaintiff's pleadings.

The current proceedings on WS No. 749 of 2001 was filed on July 3 2000. It was served on the Solicitor General's Office on 4th of the same month. The Defendant's lawyers filed a Notice of Intention to Defend on August, 22 of 2000. A formal defence was filed on October 2 the same year but was refused on the basis it was filed out of time. On 9 August, the Plaintiff filed a Notice of Motion seeking Default Judgment and by 18th of that month judgment was entered in favour of the Plaintiff for damages to be assessed.

Following the above, the Defendant filed a notice to set aside the judgment but was struck out for want of prosecution and the matter was then brought before me for trial on assessment of damages but which trial was vacated due to the two motions, the subject of this judgment.

There are a number of contentions arising from the notice filed by the Defendant. First Mr. Lambu argued that the pleadings do not disclose a reasonable cause of action and the claim should be dismissed pursuant to Order 8 Rule 27 (1)(a). Order 8 Rule 27 (1)(a) provides.

"27. Embarrassment.

(1) Where a pleading —

(a) discloses no reasonable cause of action or defence or other case appropriate to the nature of the pleadings; or

(b) has a tendency to cause prejudice, embarrassment or delay in the proceedings; or

(c) is otherwise an abuse of the process of the Court,

the Court may at any stage of the proceedings, on terms or otherwise, order that the whole or any part of the pleadings be struck out.

(2) The Court may receive evidence on the hearing of an application for an order under Sub-rule (1)."

Mr. Lambu argued sporadically that, there are various factors affecting validity of the claim. The first is that, with the magnitude of such a contract involving a huge amount of money could not have been entered into in isolation of the requirement of applying the Public Finance Management Act. That the contract had not been through a Public Tenders Board as required by the Act and such contract would have to be approved by His Excellency the Governor General of Papua New Guinea.

The second ground relied on by the defence relates to the question of "res judicata". On this ground, in Mr. Kua's affidavit filed on 16th of this month in support of their motion says at paragraph 3 (a)(b) that the pleadings in the current action WS. No. 749 of...