National Provident Fund Board of Trustees v James [Jimmy] Maladina, Kumagai Gumi Co Ltd, Ken Yapane & Associates Ltd, Ken Yapane, Kuntila No 35 Ltd, Janet Karl, Dick Karl and Ango Wangatau, Kenneth Norman Barker, Port Moresby First National Real Estate Ltd, Bethgold Pty Ltd, Maurice John Sullivan, Barbra Perks, Ulya Real Estate Limited, Herman Leahy, David Lighfoot [Lightfoot], John Beattie, Kelly Naru and Bernad [Bernard] Avery practising with Jimmy Maladina as 'Carter Newell Lawyers, Bluehaven No 42 Ltd and Ram Business Consultants Ltd (2003) N2486

• Jurisdiction: Papua New Guinea
• Judge: Kandakasi J
• Judgment Date: 05 December 2003
• Court: National Court
• Judgement Number: N2486

Full Title: National Provident Fund Board of Trustees v James [Jimmy] Maladina, Kumagai Gumi Co Ltd, Ken Yapane & Associates Ltd, Ken Yapane, Kuntila No 35 Ltd, Janet Karl, Dick Karl and Ango Wangatau, Kenneth Norman Barker, Port Moresby First National Real Estate Ltd, Bethgold Pty Ltd, Maurice John Sullivan, Barbra Perks, Ulya Real Estate Limited, Herman Leahy, David Lighfoot [Lightfoot], John Beattie, Kelly Naru and Bernad [Bernard] Avery practising with Jimmy Maladina as 'Carter Newell Lawyers, Bluehaven No 42 Ltd and Ram Business Consultants Ltd (2003) N2486

National Court: Kandakasi J

Judgment Delivered: 5 December 2003

N2486

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

OS. NO. 83 OF 2001

NATIONAL PROVIDENT FUND BOARD OF TRUSTEES

Plaintiff

AND:

JAMES MALADINA

First Defendant

AND:

KUMAGAI GUMI CO. LTD

Second Defendant

AND:

KEN YAPANE & ASSOCIATES LTD

Third Defendant

AND:

KEN YAPANE

Fourth Defendant

AND:

KUNTILA NO 35 LTD

Fifth Defendant

AND:

JANET KARL, DICK KARL & ANGO WANGATAU

Sixth Defendant

AND:

KENNETH NORMAN BARKER

Seventh Defendant

AND:

PORT MORESBY FIRST NATIONAL REAL ESTATE LTD

Eighth Defendant

AND:

BETHGOLD PTY LTD

Ninth Defendant

AND:

MAURICE JOHN SULLIVAN

Tenth Defendant

AND:

BARBRA PERKS

Eleventh Defendant

AND:

ULYA REAL ESTATE LIMITED

Twelfth Defendant

AND:

HERMAN LEAHY

Thirteenth Defendant

AND:

DAVID LIGHFOOT, JOHN BEATTIE, KELLY NARU & BERNAD AVERY PRACTISING WITH JIMMY MALADINA AS ‘CARTER NEWELL LAWYERS

Fourteenth Defendants

AND:

BLUEHAVEN NO 42 LTD

Fifteenth Defendant

AND:

RAM BUSINESS CONSULTANTS LTD

Sixteenth Defendant

WAIGANI: KANDAKASI, J.

2003: 11th September & 05th December

PRACTICE & PROCEDURE – Pleadings – Purpose and object of – To enable parties to fully disclose their claims to avoid unnecessary delays, trial by ambush and attrition and to enable an out of court settlement or payment into court if need be - A mere denial of a claim without more when more is reasonably required and or where verification of a defence is required amounts to general denial – Effect of – Amounts to evasion or avoidance and an affront to the purpose and object of pleadings attracting an application of the provisions of O.8, r. 27 – Such pleadings liable to be struck out - Order 8 rr. 24 and 27.

PRACTICE & PROCEDURE – Application for summary judgement – Claim for certain sum of money paid fraud over and above contract entitlements due to fraud – Claim falling within exceptions to the application of summary judgement procedure – Exceptions necessary in cases where a defendant is entitled to a jury trial – Recent developments in England omitted claims based on fraud from the list of exceptions – List of exceptions generally considered inappropriate to PNG circumstances as there is no jury trial and there is always the need to promptly resolve disputes – Claims based on fraud specifically inappropriate since England as removed it from the list of exceptions - Order 12, rr.37 and 38.

PRACTICE & PROCEDURE – Further and better particulars – A party is required to plead with full particulars – Where there is a failure, it is incumbent upon the other party to request they be provided – Failure to do so means the failing party is content with the pleadings – A belated claim for lack of particulars in response to an application for judgement based on the pleadings should not be sustained to avoid unnecessary delays and costs – Order 8, r. 36.

Facts

In a detailed statement of claim based on fraud arising out of a contractual relationship, the Plaintiff sought to recover a sum of K5.805 million with punitive damages, costs on indemnity basis and interest at commercial bank rates. The plaintiff paid the amount claimed to the Second Defendant (“Kumagai”) which was over and above the contract price due to a conspiracy and fraud committed against it by Kumagai in association with the other named defendants. The plaintiff’s pleadings detailed the relevant terms of the contract, how the payment of the K5.805 million was secured, how the proceeds were dealt with and who ultimately received them. Without verifying its defence, Kumagai generally denied the claim and without providing any reasons for its denials. Application was therefore made by the Plaintiff for a dismissal of Kumagai’s defence and for judgement, costs and interests under O.8, r.27 and O.12, r. 25(c) and 38.

Held:

1. The object of pleadings is to enable the parties to fully disclose in fairness the basis of their claim or a defence with particulars to avoid delay, trials by ambush, evasion and or attrition. They also enable the opposing party to know precisely the claim he or she is to meet and if need be, enable an out of Court settlement or a payment into Court. At the same time, pleadings enable the Court to know exactly what are the issues between the parties and what it is required to hear and determine. Followed Motor Vehicles Insurance (PNG) Trust v. John Etape [1994] PNGLR 596; Motor Vehicles Insurance (PNG) Trust v. James Pupune [1993] PNGLR 370; Papua New Guinea Banking Corporation (PNGBC) v. Jeff Tole (Unreported judgement delivered on 27/09/02) SC694; Pius Sankin & Ors v. Papua New Guinea Electricity Commission (Unreported judgement delivered on 19/07/02) N2257.

2. Although O.8, r. 21 (1) permits a general denial as opposed to pleading the general issue which is prohibited by O.8, r.28, a party is nonetheless required to specifically plead to specific matters pleaded against him or her with particulars where that party is a party to the contract or the facts giving rise to the claim. A defendant is also required to verify is defence under O.8, r.24 where the claim is liquidated or is certain and or is easily ascertainable. A failure to do so may amount to an embarrassment, or have a tendency to delay or otherwise cause prejudice to the other party and may attract the application of O.8, r. 27 and in the case of verification under O.12, r. 25(c). Followed Tau Gumu v. Papua New Guinea Banking Corporation Limited (Unreported judgement delivered 26/04/02) N2251.

3. In the present case the Plaintiff’s claim was for a specific and certain amount and “no other claim” within the meaning of O.8, r.24. The additional claims for punitive damages, costs and interests were consequential and dependent on the main claim for a recovery of the K5.805 million. Accordingly, Kumagai was required to verify its defence but it did not thereby attracting an application of O.12, r. 25 (c). Followed Dempsey v. Pacific Pty Ltd [1985] PNGLR 93 and Michael Newal Wilson v. Harold Rosser Howard [1994] PNGLR 418.

4. Also the Plaintiff’s claim was based on a contract and facts in which Kumagai was a party. It was therefore reasonably expected and required to answer to each of the Plaintiff’s allegations against it specifically with particulars and or reasons as to why it was denying the claims and was not prepared to admit or that they were not necessary for it to specifically plead to.

5. Kumagai’s defence was too general and evasive when a specific response with particulars was reasonably expected with verification in accordance with O.8, r.24 thereby attracting the application of O.12, r. 25 (c). It also had the tendency to embarrass, prejudice and delay the proceedings thereby attracting the application of O.8, r.27.

6. In relation to the application for summary judgement under O.12, r.38, the exception to the summary judgement procedure as specified in O.12, r. 37 are inappropriate to the circumstances of Papua New Guinea because:

(a) The exception list was for cases in which a defendant is entitled to a jury trial. By a deliberate act through the Constitution jury trials where done away with for PNG in place of judges and magistrates trained and experienced in the law; and

(a) If the intend of the procedure is to enable a plaintiff to get to judgement promptly where there is no viable defence of a defendant it makes no sense to retain the exception list. The requirements for signing summary judgement (i) affidavit evidence proving the essential elements of the claim; (ii) the affidavit evidence coming from the plaintiff or a responsible person; and (iii) a statement by the deponent of such an affidavit that in his belief there is no defence on the merits are sufficient safeguards and as such the exception list should not prevent summary...