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Aglum, Kau and Uglo, all Infants, by Their Next Friend, Cecilia Guglake v Motor Vehicles Insurance (PNG) Trust [1988] PGNC 7; N678 (30 September 1988)

Unreported National Court Decisions

N678

PAPUA NEW GUINEA

[NATIONAL COURT OF JUSTICE]

O.S. 98 OF 1988
EVA AGLUM, JOSEPH KAU AND GABRIEL UGLO ALL INFANTS BY THEIR NEXT FRIEND CECILIA GUGLAKE
PLAINTIFFS
V
MOTOR VEHICLES INSURANCE (PNG) TRUST
DEFENDANT

Kundiawa & Waigani

Bredmeyer J
23 September 1988
30 September 1988

DAMAGES - fatal accident - estate claim and dependency claim under the Wrongs (Miscellaneous Provisions) Act Ch. 297.

DAMAGES - loss of expectation of life - conventional sum of K1,500 - plus reasonable funeral expenses.

INFANTS - approval of infant settlement - proposed settlement rejected.

Cases Cited

Kerr -v- M.V.I. (PNG) Trust (1979) P.N.G.L.R. 251.

Koni Nim -v- Papua New Guinea (1984) P.N.G.L.R. 232.

Pinzger -v- Bougainville Copper Ltd. (1985) P.N.G.L.R. 160.

Notice of Motion

This was a motion for approval of a settlement on behalf of three infant plaintiffs claiming damages for the death of their father in a motor vehicle accident.

Counsel

Y. Bal, for the plaintiffs, exparte.

Cur. adv. vult.

30 September 1988

BREDMEYER J: I have beend to approve anve an infant settlement of K3,450 damages arising out of the death of Michael Nime Kagl who was killed when the ve in which he was travelling as a passenger collided with another on 2 May 1986.

Thep>The deceased was aged 32 at the date of death. He was married by custom to Cecilia Guglake of Mai village aged about 30 years at the date of death. He left three dependent children at the date of death, Eva Aglum (aged 15), Gabriel Uglo (aged 9) and Joseph Kau (aged 2). To date the widow has not remarried. The opinion in favour of the settlement states that the deceased was employed at the time of the accident by Ramu Sugar Ltd. as a security man at K33 per fortnight and, at the time of the accident, he was travelling in a vehicle owned and operated by Ramu Sugar Ltd.

The husband was 32 at the date of death. The age of retirement is usually taken as 55 years in Papua New Guinea, thus he had a working life of 23 years; or, to put it another way, the wife could expect to be supported by her husband, had he lived, for another 23 years. The opinion encloses a schedule of calculations. In the wife’s case the calculation is 23 years (I take the figure of 30 there to be a typing error) dependency at K4.50 per week which equals K3,919.50 when capitalized on the 3% discount tables which is the correct rate following Pinzger -v- Bougainville Copper Ltd. (1985) P.N.G.L.R. 160. Then a 33% reduction is made for the possibility of the wife’s remarriage and other contingencies.

The age of dependency in Papua New Guinea is taken as 16 years and the children’s claims are calculated on K2.50 per week projected x 1, 9 and 14 years respectively. These sums are capitalized in the opinion on the 3% discount tables at K128, K1,030 and K1,495 respectively. From the first sum, K128 is deducted for contingencies, and K100 for contingencies is deducted from each of the other sums, reducing the three sums to nil, K930 and K1,395.

The opinion states that basic protection compensation has been paid. The sum is K2,000 or K1,500. It is not clear which from the typing as one figure is superimposed on the other; nor is it clear from the arithmetic. In the opinion approximately K1,460 is deducted from the wife’s sum and K100 from each of the three children. That adds up to K1,760. The normal basic protection sum paid to a widow is K2,000. The plaintiff should clearly state what sum was paid.

I am not willing to approve this settlement for the following reasons. Firstly the proposed settlement figure omits the estate claim. There are two kinds of claim under the Wrongs (Miscellaneous Provisions) Act Ch. 297, the estate claim under Part V of the Act (s. 34), and the dependency claim under Part IV (ss. 24-33) of the Act. The estate claim is K1,500 for loss of expectation of life, a conventional sum fixed by the court, or at least approved by the Supreme Court, in Kerr v M.V.I. (PNG) Trust (1979) P.N.G.L.R. 251. In addition a reasonable sum for funeral expenses can be allowed by virtue of s. 34(3)(c) of the Act. In this case no evidence has been placed before me as to funeral expenses - maybe they were met or partly met by the employer - nevertheless such evidence should be available. It is customary in Papua New Guinea for even very poor people to spend reasonably large sums on funerals. A full-size pig can cost K500, and such a pig - or more than one - may have been killed in this case. So in considering the adequacy of a settlement figure in this case, K1,500 must be allowed for loss of expectation of life and say K500 for reasonable funeral expenses. The basic protection payment of K2000 must be deducted from any common law damages (see s. 25(1)(b) of the Motor Vehicles (Third Party Insurance)(Basic Protection Compensation) Act Ch. 296 and it is convenient to deduct it from the estate claim. That is the estate claim of about K2,000 is cancelled out by the basic protection compensation already paid.

The second mistake relates to the daughter Eva. She was 15 at the date of the accident (2 May 1986) and is now 17. Her dependency period is 1 year. The opinion has multiplied K2.50 per week x 1 year x 3% discount tables to get a capital sum of K128.54. The writer of the opinion has then reduced it by the same sum K128.54 for contingencies to get nil. This is wrong in two ways. In the first place, she has already reached 16 so it is wrong to apply the 3% tables at all. It is wrong to say K128.54 is the sum which invested at 3% for one year would give an income of K2.50 per week. That year has past and she is entitled to the total sum now, i.e. 52 weeks x K2.50 p.w = K130 plus a little for interest. Also no deduction for contingencies such as premature death is appropriate. She has already survived that year. She should get the full sum plus, as I have said, interest.

The third mistake, as I see it, is the K100 deducted from Gabriel’s and Joseph’s claims “for contingencies - basic protection compensation”. I am confused here. Is the deduction for contingencies, or for basic protection compensation? If it is for contingencies, then K100 from Gabriel’s capitalized sum of K1,030 and K100 from Joseph’s capitalized sum of K1495, is too high. A 5% reduction in my view, would be more appropriate. If the K100 deduction is for the basic protection compensation already paid, then, as I have said above, that should be deducted from the estate claim.

The opinion in this case recommending approval of the settlement comes from a young lawyer employed by Mr. Isidore Kuamin of Kundiawa. That is not correct. It should come from the most senior lawyer in that firm experienced in this area of law. If the junior lawyer prepares a draft, well and good, but the opinion presented to the court should be signed by the senior man: see Koni Nim -v- Papua New Guinea (1984) P.N.G.L.R. 232 at 241-2 which discusses this in some detail.

The proposed settlement is rejected. The lawyer for the plaintiff should attempt to negotiate a better settlement and, if successful, come back to the National Court (not necessarily to me) with a new opinion prepared by Mr. Kuamin.

A final comment which is meant to be helpful not destructively critical. The opinion says that the deceased was employed by Ramu Sugar Ltd. and died as a passenger in a vehicle owned and operated by that company. If so, his dependants may be entitled to workers compensation under the Workers’ Compensation Act Ch. 179. That compensation would appear to be more generous in this case than common law damages: see the provisions of ss. 65 and 72 of the Act. For example the compensation for a dependent child under 16 is K5.50 per week. I do not think that I have power to reject a common law settlement on behalf of infants because workers compensation would have been more generous. I merely ask the lawyers for the plaintiff to give this question some thought as being in the best interests of the children. Any award of damages has to be deducted from a compensation award, and vice versa (s. 84), but it may be possible in this case to get an additional sum from workers compensation.

Lawyer for the plaintiff: I. Kuamin & Associates

Lawyer for the defendant: Young & Williams.