Paula Haus Win Ltd v Francis Kunai

• Jurisdiction: Papua New Guinea
• Judge: Frank, J
• Judgment Date: 02 October 2015
• Citation: (2015) N6154
• Court: National Court
• Year: 2015
• Judgement Number: N6154

Full : WS 665 of 2011; Paula Haus Win Limited v Francis Kunai (2015) N6154

National Court: Frank, J

Judgment Delivered: 2 October 2015

N6154

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

WS 665 OF 2011

BETWEEN:

PAULA HAUS WIN LIMITED

Plaintiff

AND

FRANCIS KUNAI

Defendant

Mt Hagen: Frank, J

2015: 2 October

PRACTICE AND PROCEDURE- Application to set aside summary judgment-Principles applicable

PRACTICE AND PROCEDURE- Service of documents- Service by post-Sufficiency of- Evidence of- Postal Services Act 1996,s, 7(3)

PRACTICE AND PROCEDURE- application to dismiss proceedings-frivolous, vexatious and abuse of process-National Court Rules, Order 12 Rule 40.

PRACTICE AND PROCEDURE- application to amend pleadings-Principles applicable-National Court Rules, Order 8 Rule 50(1).

Cases Cited:

Arman Larmer Surveys Ltd v Chan Consolidated Ltd (2013) SC1253

Barker v The Government of Papua New Guinea, Davis & Bux [1976] PNGLR 340

Bruce Tsang v. Credit Corporation (PNG) Ltd [1993] PNGLR 112

Chief Collector of Taxes v Dickson Panel Works Pty Ltd and Others [1988] PNGLR 186

Christopher Smith v Ruma Construction (2002) SC695

Dr Yvonne Sapuri v Peter Kolly (2014) SC1310

Green & Company Pty Ltd v Green[1976] PNGLR 73

Kabil Worm and 101 Others v Sergeant Koken and The Independent State of Papua New Guinea [1996] PNGLR 58

Kerry Lerro v Philip Stagg (2006) N3050

Kumul Builders Pty Ltd- vs –Post and Telecommunication Corporation [1991] PNGLR 299

Molin Chapau v The Independent State of Papua New Guinea (1999) N1933

Mt Hagen Urban Local Level Government v Sek No. 15 Ltd (2009) SC1007

Nancy Tambe and Others v Linda Tamsen and Another (2004) N2714

O’Connor v Popondetta Engineering and Transport Co Pty Ltd [1967-68] PNGLR 363

Page P/L v Balakau [1982] PNGLR 140

Counsel:

Mr P.Dowa, for the plaintiff/respondent

Mr. J. Abone, for the defendant/applicant

RULING ON APPLICATION

2nd October, 2015

1. FRANK J: The defendant, by Notice of Motion filed on 29 August 2014(“Motion”),applies, pursuant to Order 12 Rule 8(2),(3) and (4) of the National Court Rules(“Rules”), (a) to set aside the summary judgement orders, one made on 19 July 2013 and entered on 26 July 2013(“19/07/13-orders”) and the other made on 11 July 2014 and entered on 16 July 2014(“Orders”), and (b) for leave to be granted to the defendant to amend his defence, and(c) to have this proceeding dismissed as being frivolous, vexatious and an abuse of process. The summary judgment application was moved and the orders were granted on the same day.

2. The application is supported by three affidavits of the defendant (a) the first, sworn on 3 and filed on 4 April 2013, (b) the second, sworn on 7 and filed on 28 August 2013, and (c) the third, sworn on 28 and filed on 29 August 2014.

3. The plaintiff opposes the application, and in response, relies on the (a) Affidavit of Paulus M.Dowa sworn 30 May and filed 2 June 2015, (b) Affidavit of Service of Bicken Nickson sworn and filed on 11 July 2014 and (d) Affidavit of Arnold Mek sworn 12 October and filed 30 November 2011.

4. The terms of the orders are that:

1. “The Defence filed on the 27th July 2011 be dismissed for pleadings a general denial under Order 8, Rule 28 of the National Court Rules.

2. A summary judgment be entered for the plaintiff pursuant to Order 12,Rule 38 of the National Court Rules in the sum of K35,970.00

3. Interest at 8% be added on the principal judgment.

4. Costs of this application be settled by the Defendant.”

5. The 19/07/13-orders were in terms similar to those of the Orders but had an additional (fifth) order that:

“ The defendants Cross Motion filed on 04th April, 2013 is dismissed for want of prosecution.”

6. I deal firstly with the 19/07/13-orders. It was not contested that these orders were set aside on 15 November 2013. The defendant’s lawyers lodged a minute of the 15 November 2013orders which was entered on 17 February 2014 as document No. 24. Order No.1 of the 15 November 2013 orders states that the ex-parte of 19 July 2012’ is set aside. Mr. Abone of the counsel for the defendant pointed out that the reference to ‘2012’ in it is a typographical error, and should have referred to ‘2013’. The plaintiff does not dispute this. Both Mr. Abone and Mr. Dowa of counsel for the plaintiff appeared before the court when the orders of 15 November 2013 were made. There is therefore no order made on 15 November 2013 that exists for it to be the subject of a setting aside application. That part of the application is dismissed.

7. The plaintiff opposes the application to set aside the Orders on the grounds that (a) this court does not have jurisdiction to hear and determine an application to set aside a summary judgment, (b) the Motion and supporting affidavit were served on the defendant:(c) the defendant has not taken steps to prosecute the Motion promptly despite it being filed on 29 August 2014 thereby allowing the plaintiff to take steps to enforce the Orders by having its costs under the Orders taxed.

8. I deal with the jurisdiction issue first. The plaintiff submits that a party aggrieved by a summary judgement made pursuant to Order 12 Rule 38 can only challenge it by way of an appeal to the Supreme Court, and that this jurisdiction does not empower one judge to review a summary judgment granted by another judge of the National Court. In the result, this Court does not have the jurisdiction to hear and determine the application to set aside the Orders. Mr Dowa sites Christopher Smith v Ruma Construction (2002) SC 695 and Kerry Lerro v Philip Stagg (2006) N3050 as authorities for this propositions.

9. In Smith (supra), the appellant has challenged, inter alia, a decision of the National Court setting aside a summary judgment granted by another judge. In the course of its determination of this ground of appeal, the Supreme Court considered the principles relevant to an application to set aside a summary judgment, Kapi DCJ said-

“So far as entry of default judgement under O 12 Division 3 of the Rules and summary judgment under O 12 r 38 are concerned, the basis upon which the respective judgments may be entered are different. The former is dependent upon satisfaction of default on the part of the dependant. Whereas the latter is dependent upon satisfying the court firstly that there is evidence of facts on which the claim is based and secondly that there is evidence given by the plaintiff or some responsible person that,in the belief of the person giving the evidence,the defendant has no defence to the claim. The trial judge was correct in his conclusion to this extent.

However,it does not follow that the principles for setting aside either type of judgements are also different. This calls for close examination of O 12 r 8:”

10. His Honour then quotes the provisions of Order 12 Rule 8(2) and (3)(a),which are –

“(1)....

“(2) The Court may, on terms, set aside or vary a judgment-

(a) Where the judgment has been entered pursuant to Order 12 Division 3(default judgment); or

(b) Where the judgment has been entered pursuant to a direction given in the absence of a party, whether or not the absent party had notice of trial or of any motion for the direction; or

(c) When the judgment has been entered in proceedings for possession of land pursuant to a direction given in the absence of a person and the Court decides to make an order that the person be added as a defendant.

(3) The Court may, on terms, set aside or vary an order-

(a) where the order has been made in the absence of a party, whether or not the absent party is in default of giving a notice of intention to defend or otherwise in default, and whether or not the absent party had notice of motion for the order; or

(b)....”

11. His honour continues –

“It is evident from this provision that the discretion to set aside a judgment under O 12 r 8 is the same whether a party is seeking to set aside a judgment under r 2 (a) (default judgement), (b) (judgment pursuant to a direction in absence of a party (c) (judgment for possession of land) or to set aside an order under r 3(a) (any order made in absence of a party). The words “The Court may, on terms, set aside or vary a judgment” are applicable to application to set aside all categories of judgments and orders set out above.

The discretion to set aside default judgment is also provided for under Order 12 r 35. The discretion to set aside under this provision is couched in identical terms to O 12 r 8(2) and (3). It follows from this that the principles governing the exercise of discretion would be the same.

These principles are now settled in Green & Co.v Green [1976] PNGLR 73; PNG V Baker[1977] PNGLR 386; George Page Pty Ltd v Balakau [1982] PNGLR 140. The onus is on the applicant to satisfy the Court:

(1) Why the judgment was allowed to be entered in absence of the applicant.

(2) If there is a delay in making the application to set aside, a reasonable explanation as to the delay.

(3) That there is a defence on the merits.”

12. Kandakasi J reached the same conclusion in these words:

“The law on an application to set aside an ex parte order is clear. Order 12 r,8(3) grants the National Court power to set aside an order made in the absence of one of the parties. This Court in Motor Vehicle Insurance (PNG) Trust v. Joseph Bure (unreported...