NKW Holdings Ltd v Paladin Solutions PNG Ltd (2020) N8339

• Jurisdiction: Papua New Guinea
• Judge: Anis J
• Judgment Date: 05 June 2020
• Citation: (2020) N8339
• Docket Number: WS (COMM) No 115 of 2019
• Court: National Court
• Year: 2020
• Judgement Number: N8339

Full Title: WS (COMM) No 115 of 2019; NKW Holdings Ltd v Paladin Solutions PNG Ltd (2020) N8339

National Court: Anis J

Judgment Delivered: 5 June 2020

N8339

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

WS (COMM) NO. 115 OF 2019

BETWEEN

NKW HOLDINGS LIMITED

Plaintiff

AND:

PALADIN SOLUTIONS PNG LIMITED

Defendant

Waigani: Anis J

2019: 29th November

2020: 5th June

LAW OF CONTRACT – Debt recovery claim based on outstanding invoices – whether there was a valid contract between the parties based upon which invoices were issued – When was the contract entered into? Where there evidence of or conducts that constituted an offer, acceptance, consideration and intention to create legal relations?

RESTITUTION FOR UNJUST ENRICHMENT – whether money had been paid under a mistake of fact – money paid to settle one of the invoices for provision of meals – consideration of evidence – whether defendant able to establish mistake of fact – whether payment amounts to unjust enrichment – assessment

Cases Cited:

Papua New Guinea Cases

Keam Investments Ltd v. Toyota Tsusho (PNG) Ltd (2019) N7859

Hargy Oil Palm Ltd v. Ewase Landowners Association (2013) N5441

Steven Naki v. AGC (Pacific) Ltd (2005) N2782

Shell Papua New Guinea Ltd v. Speko Investment Ltd (2004) SC767

Vanimo Forest Products Ltd v. Ossima Resources Ltd (2013) SC 1275

Nivani Ltd v. Coconut Products Ltd (2016) N6582

Koroguen v. Wagen (2008) N3422

Steven Turik v. Mathew Gubag (2013) N5132

Overseas Cases

Banque Financiere de la Cite v. Parc (Battersea) Ltd [1999] AC 221

Counsel:

Mr A Mana, for the Plaintiff

Mr H D Katter with counsel assisting Ms Heagi, for the Defendant

JUDGMENT

5th June, 2020

1. ANIS J: This matter was trialed on 29 November 2019. I reserved my ruling to a date to be advised. Parties have been notified so I will rule on it now.

BACKGROUND

2. The plaintiff operates as the Facility Manager at areas called the West Lorengau Haus and Hillside Haus, in Manus Province. It is engaged by the Commonwealth of Australia (the Commonwealth) to, amongst others, house refugees and non-refugees. It also provides catering service at the area. Its claim is this. It says that in January of 2018, it had entered into a contract (the January 2018 contract) with the defendant to provide meals to the defendant’s employees who were stationed in Manus Island. It says that the contract had been entered into by the conduct of the parties. It says meals were charged at the rate of K15 per meal. It says the defendant’s employees were required to and had to sign meal dockets before they received their meals at the material time. It says that based on the January 2018 contract, it had, from 1 January 2018 to 31 July 2018, provided meals to the defendant’s employees. It says that following that, it sent a total of 6 meal invoices to the defendant that totaled K2,156,853. It says that the defendant has refused to pay. It files this proceeding to claim the K2,156,853 plus interest and cost.

3. The defendant’s defence is this. It says the pleading, that is, the Amended Statement of Claim (ASoC), is vague and does not disclose the alleged January 2018 contract. It claims that the ASoC lacks the pleaded facts that establish the elements of a valid contract, namely, offer, acceptance, consideration and intention to create legal relations. It submits, as its substantive defence, that there was no contract as alleged by the plaintiff, that had been entered in January of 2018. It says the only contract it is aware of was the one that had been entered into between the parties and the Commonwealth, on or about 23 October 2017 (the October 2017 agreement). It says the October 2017 agreement had initially been set for a period of 1 month, but it says that it (i.e., the October 2017 agreement) continued on until it was terminated on 31 July 2018. According to the October 2017 agreement, the Commonwealth had agreed to and had paid for meals that had been provided by the plaintiff and consumed by the defendant’s employees. The defendant claims that the payment of meals consumed by its employees was always the responsibility of the Commonwealth, and as such, it says that the plaintiff should seek payment of its invoices from the Commonwealth and not against it.

4. The defendant has also filed a cross-claim. In the cross-claim, it seeks to reclaim under the relief, restitution for unjust enrichment, a sum of K246,939 or a reasonable sum that may be assessed by the Court. The defendant claims that the money had been paid to the plaintiff under a mistake of fact. It also seeks to recover interest and cost.

EVIDENCE

5. The plaintiff tendered 3 affidavits. The affidavits were marked as Exhibits P1, P2 and P3. They were all deposed to by Heath Bruns who is the Commercial Manager for the plaintiff. The defendant, on the other hand, tendered a total of 4 affidavits. They were marked as Exhibits D1, D2, D3 and D4 respectively. Exhibits D1, D2 and D4 consist of affidavits that were deposed to by David Saul, and Exhibit D3 consists of an affidavit that was deposed to by Philip Burke. David Saul is the Managing Director of the defendant. Philip Burke was the General Manager – Operations for the defendant at the material time.

COMMON GROUND

6. The parties do not dispute that meals that were provided to the employees of the defendant before 1 January 2018 were paid for by the Commonwealth. The parties do not dispute the main terms and conditions of the October 2017 agreement which included these: The agreement was for an interim period of 1 month, that is, from or about 27 October 2017 to on or about 27 November 2017. During that time, meals were supplied by the plaintiff to the defendant’s employees upon signing meal dockets, and the Commonwealth was responsible for and had paid for the meals.

ISSUES

7. The issues, in my view, are, (i) whether the pleadings concerning the material facts are vague, (ii), whether there is evidence disclosed of the January 2018 contract or of its existence, (iii), whether the plaintiff is entitled to be paid the sum of K2,156,853 together with interest and cost, and (iv), whether the K246,939 was paid under a mistake of fact and whether the defendant should repay the money; whether the plaintiff has unjustly enriched itself having received the money from the defendant.

MATERIAL FACTS/VALID CONTRACT?

8. I prefer to address the first and second issues together. I ask myself this. Was there a valid contract that existed at the material time? What material facts existed then which are disclosed that would assist me determine the January 2018 contract?

9. I refer to the pleading, and in particular, the ASoC. The plaintiff alleges that the January 2018 contract was entered into between the plaintiff and the defendant. The plaintiff pleads that the January 2018 contract was created by conduct of the parties. I refer to paragraph 4(c)(a) of the ASoC and the evidence that the plaintiff has adduced. According to the plaintiff, the conducts which it says constituted the January 2018 contract, were, and I summarize as follows:

- the provision of meals by the plaintiff to the defendant’s employees upon their request, from 1 January 2018 to 31 July 2018;

- the act of signing meal dockets by an employee of the defendant for every meal that was provided to the defendant’s employees, from 1 January 2018 to 31 July 2018.

- consumption of meals by employees of the defendant from 1 January 2018 to 31 July 2018.

10. I refer to Exhibit P1. Mr Bruns gives evidence to support the plaintiff’s claim of the existence of the January 2018 contract. Mr Bruns states at paragraphs 3 to 7, and I quote:

3. The Plaintiff and the Defendant entered into an agreement in or about January 2018. The Defendant requested and the Plaintiff agreed to provide meals to the Defendant and the Defendant’s sub-contractor, namely, Peren Investment Limited (Peren, and their respective employees deployed at the Facilities at the rate of K15.00 per meal.

4. The agreement was partly verbal and partly by conduct of the parties.

5. Consistent with this agreement, the Plaintiff provided meals to the Defendant’s employees for the period between January to July 2018.

5. Consistent with this agreement, the Plaintiff provided meals to the Defendant’s employees for the period between January to July 2018.

6. The Defendant’s and Peren’s employees deployed at the Facilities accepted the provided meals which was evidenced by endorsement of the relevant meal dockets.

7. The Plaintiff’s provision of meals to each employee of the Defendant and Peren was evidenced by the signing of meal dockets and no meals were provided without the endorsement of the relevant docket covering all meals provided on the day by a duly authorized representative from Paladin.

(Bold letterings mine)

11. I ask myself this. What agreement is Mr Bruns referring to here? Mr Bruns, in my view, does not give full disclosure or evidence at all of the agreement in his evidence. He appears to merely state that an ‘agreement’ was entered into in January of 2018, and then he refers back to the ‘agreement’ and deposes facts or events...