Lau Sorum v Daniel Aloi as the Provincial Administrator Madang Provincial Government and Pauline Ainui as the Director Human Resource Division of Madang Provincial Administration and Peter Torot as the Deputy Provincial Administrator in charge of Community and Local Level Government Affairs and Joe Yama as the Town Mayor, Madang Urban Local Level Government and Madang Urban Local Level Government (2020) N8416

• Jurisdiction: Papua New Guinea
• Judge: Narokobi J
• Judgment Date: 16 July 2020
• Court: National Court
• Citation: (2020) N8416
• Docket Number: WS No 994 of 2018
• Year: 2020
• Judgement Number: N8416

Full Title: WS No 994 of 2018; Lau Sorum v Daniel Aloi as the Provincial Administrator Madang Provincial Government and Pauline Ainui as the Director Human Resource Division of Madang Provincial Administration and Peter Torot as the Deputy Provincial Administrator in charge of Community and Local Level Government Affairs and Joe Yama as the Town Mayor, Madang Urban Local Level Government and Madang Urban Local Level Government (2020) N8416

National Court: Narokobi J

Judgment Delivered: 16 July 2020

N8416

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

WS NO. 994 OF 2018

BETWEEN:

LAU SORUM

Plaintiff

AND:

DANIEL ALOI AS THE PROVINCIAL ADMINISTRATOR MADANG PROVINCIAL GOVERNMENT

First Defendant

AND:

PAULINE AINUI AS THE DIRECTOR HUMAN RESOURCE DIVISION OF MADANG PROVINCIAL ADMINISTRATION

Second Defendant

PETER TOROT AS THE DEPUTY PROVINCIAL ADMINISTRATOR IN CHARGE OF COMMUNITY AND LOCAL LEVEL GOVERNMENT AFFAIRS

Third Defendant

AND:

JOE YAMA AS THE TOWN MAYOR, MADANG URBAN LOCAL LEVEL GOVERNMENT

Fourth Defendant

AND:

MADANG URBAN LOCAL LEVEL GOVERNMENT

Fifth Defendant

Madang: Narokobi J

2020 : 12th & 16th June, 16th July

DAMAGES - Assessment of damages – Breach of contract – Negligence – Unpaid Entitlements - Liability not in issue – Appropriate Amount for Each Head of Damages Claimed – General Damages for Breach of Employment Contract – Special Entitlement of Office- Exemplary Damages – Whether Appropriate in the Circumstances

INTEREST ON DAMAGES – Whether provincial government and local level government part of the state for purposes of the Judicial Proceedings (Interest on Debts and Damages) Act 2015

Facts

The Plaintiff was the former Town Manager of Madang. He was appointed through the Public Service process, but his appointment was refused by the Town Mayor. He successfully obtained a court order to commence work in a separate judicial review proceeding. After working for a period of time, he was not allowed to continue work as the town manager although his contract had one (1) year and 45 days left and he was on his base salary. He claims general damages for breach of contract and negligence, exemplary damages and unpaid special benefits. His claim was not defended and he obtained default judgment. He is now before the court for assessment of damages.

Held:

(1) When default judgement is entered against the defendant, it is conclusive as to the issue of liability (Coecon Ltd (Receiver-Manager Appointed) v National Fisheries Authority of Papua New Guinea (2002) N2182 and Patai v Niugini Lumber Merchants Pty Ltd (1997) N1602 followed).

(2) The role of the trial judge assessing damages after entry of default judgment is restricted to making a cursory inquiry into the circumstances in which liability was established so as to be satisfied that the facts and the cause of action are pleaded with sufficient clarity. If it is reasonably clear what the facts and cause of action are, liability should be regarded as proven (Felix Kua v. Clement Patiken (2010) N4103 followed).

(3) General damages for stress and anxiety is not generally awarded in breach of employment contract, but in circumstances where the contract was based on statute and the defendants embarked on a course to frustrate the contract by refusing to allow the plaintiff to commence work and he had to obtain a court order, commenced unfounded disciplinary proceedings, placed him in a pool, an action which the court in the past has discouraged and then treating him differentially from other previous occupants of the position, plaintiff should be allowed general damages (Baboa v PNG Communication Workers Union(2006) N3043 followed).

(4) General damages for negligence was not awarded as the pleadings was lacking in particularity and the lack was not cured by the evidence tendered and consequently no award of damages for negligence was ordered.

(5) In circumstances where the contract was based on statute and the defendants embarked on a course to frustrate the contract by refusing to allow the plaintiff to commence work and he had to obtain a court order, commenced unfounded disciplinary proceedings against him, placed him in a pool an action which was not in the public interest and then treating him differentially from other previous occupants of the position, the plaintiff should also be allowed exemplary damages.

(6) The 2% cap on debts and damages in the Judicial Proceedings (Interest on Debts and Damages Act) 2015 is not applicable to Provincial Governments and Local Level Governments where the State is not a party to the proceedings.

Cases Cited:

The following cases are cited in the judgment:

Air Niugini Ltd v Kavieng District Development Authority (2019) N8158

Ambo v Woodford (2016) N6254

Baboa v PNG Communication Workers Union (2006) N3043

Coecon Ltd (Receiver-Manager Appointed) v National Fisheries Authority of Papua New Guinea (2002) N2182

Davidwestern Advertising Group Ltd v HIRI 152 Developments Ltd (2019) N8112

Felix Kua v. Clement Patiken (2010) N4103

Habolo Building & Maintenance Ltd v Hela Provincial Government (2016) SC1549

Himsa v Sikani, Commissioner of Correctional Services (2002) N2307

Lewis v Lae Builders & Contractors Ltd (2014) N7554

MAPS Tuna Limited v Manus Provincial Government (2007) SC857

Patai v Niugini Lumber Merchants Pty Ltd (1997) N1602

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

SCR No 1 of 1998; Reservation Pursuant to Section 15 of the Supreme Court Act (2001) SC672

Sorum v Kamo (2013) N5359.

Counsel:

Mr. L. Sorum, in person

No appearance for the Defendants

16th July, 2020

1. NAROKOBI J: On 9 March 2020, default judgement was entered against the defendants pursuant to Order 12 Rules 25(b) and 28 of the National Court Rules on liability as pleaded in the statement of claim, subject to a trial on assessment of debts and damages. This is the court’s decision on assessment of damages after liability was entered by default.

A BACKGROUND

2. The plaintiff, Mr Lau Sorum (I will be referring to either “the plaintiff” or “Lau Sorum” interchangeably in my judgement) was the Town Manager of Madang, working with the Madang Urban Local Level Government (MULLG). His employment as town manager was effectively terminated on 12 November 2015 when he was transferred to another position and stayed until his contract expired on 1 October 2016. The plaintiff commenced this proceeding against the defendants seeking damages for unpaid entitlements, breach of contract and negligence.

3. The defendants are – Mr Daniel Aloi, as the Provincial Administrator, Madang Provincial Government, First Defendant; Pauline Ainui as the Director Human Resources Division of Madang Provincial Administration, Second Defendant; Peter ToRot as the Deputy Provincial Administrator in charge of Community and Local Level Government Affairs, Third Defendant; Joe Yama as the Town Mayor, Madang Urban Local Level Government, Fourth Defendant; and Madang Urban Local Level Government, Fifth Defendant.

4. On 23 August 2018, the plaintiff filed his writ of summons and soon after served on all the defendants. No Defence was filed within the stipulated period in the National Court Rules, although there is evidence in the court file of appearance of counsels for the defendants from time to time at various stages of the proceedings.

5. As stated above default judgement was entered on 9 March 2020 with damages to be assessed.

6. Trial was conducted by affidavit. On 12 June 2020, trial was concluded by the plaintiff tendering his affidavit. On 16 June 2020, the plaintiff made submissions on assessment of damages, and I reserved my decision to today.

B ISSUES

7. In my view the following are the issues I should deliberate on and determine:

Whether the court should consider the issue of liability once default judgement has been entered?;

Whether the plaintiff is entitled to general damages for breach of employment contract?;

Whether the plaintiff is entitled to be paid special damages being the special benefits of Town Mayor?;

Whether the plaintiff is entitled to general damages for negligence?; and

Whether the plaintiff is entitled to exemplary damages?

Whether the plaintiff is entitled to interest, pursuant to statute, and at what rate?

8. I therefore consider the facts and law in relation to these issues I have identified as is applicable to the particular circumstances of this case.

C PLAINTIFF’S CONTENTION

9. The Plaintiffs case is basically to claim unpaid special entitlements for his position as town manager, general damages for breach of contract and negligence and exemplary damages for the manner in which he was treated.

Statement of Claim (SOC)

10. In the plaintiff’s statement of claim, from paragraphs one (1) to eight (8), he pleads his legal capacity and of all the defendants and their various responsibilities in relation to their positions.

11. At paragraph nine (9) the SOC pleads that on 16 August 2012 the plaintiff secured employment with the Madang Provincial Administration as the town manager of MULLG. It is a designated Provincial Administration...