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Sinai v Kei Buseu Kampani Pty Ltd [1990] PGNC 65; N936 (13 November 1990)

Unreported National Court Decisions

N936

PAPUA NEW GUINEA

[NATIONAL COURT OF JUSTICE]

OS. 202 OF 1990
BETWEEN: MARK HOSEA SINAI CUSTOMARY LEGAL REPRESENTATIVE OF BUEKAU CLAN
PLAINTIFF
AND
KEI BUSEU KAMPANI PTY LTD
FIRST DEFENDANT
AND
SEAL (PNG) PTY LTD
SECOND DEFENDANT
AND
THE INDEPENDENT STATE OF PAPUA NEW GUINEA
THIRD RESPONDENT

Waigani

Sheehan J
13 November 1990

Counsel:

Mr Sitapai for Plaintiff

Mr Anderson for First Defendant

Ms Hess for Second Defendant

Mr Gelu for Third Defendant

RULING

SHEEHAN J: The Plaintiff commenced edoceedings to pursue a claim against the defendants that they have without right, logged trees on customary land of the clan th represents.

This matter came to Court in September as a matter of urgency. Logs, sos, some 7000 cube metres of logs, were being loaded aboard ship for export, and the plaintiff sought, ex-parte, to obtain a Mareva injunction to prevent the ship sailing. That order was given by myself because on the affidavit evidence supplied, the logs were being loaded onto the ship at that time; the logging company was an overseas company, and funds for the sale of the logs were not likely to come back into Papua New Guinea.

The first defendant was stated to be a local company with a local shareholding but the company was of little substance. Any funds received by the local company would be but a small percentage of the gross proceeds of the sale of the logs and would in any case be quickly dissipated amongst the villager shareholders. In such case it would be difficult if not impossible for the plaintiff to pursue a claim for damages with any chance of successful recovery of damages.

In the event, the ship sailed before the necessary documentation for an injunction was formulated. But on the same grounds, an application to freeze payments in respect of the logs claimed by the plaintiff was then made and an order granted. “The background and rationale behind these ex parte orders are shown in this Court’s decision of 28 September 1990 annexed hereto”.

Subsequently, other orders were made requiring payment into this Court of sums sufficient to ensure that a judgment in favour of the plaintiff would not be a mere matter of theory only. Los, J in his order of 11th October said:

“I have not had any benefit of knowing whether the defendant companies are foreign owned or nationally owned. The nature of the business suggested to me that at least the contracting side may be foreign. So that the fear by the plaintiff of missing out from the proceeds or benefits is not absolutely baseless.”

Those injunctions were for a fixed period only and to ensure that the plaintiff’s interests were not entirely prejudiced before the whole of the issues could be heard. That is until the parties are ready to be heard in trial.

In fact the trial is fixed for today.

The motion now before the Court seeks to strike out the plaintiffs claim and to set aside the injunctive orders affecting defendants. It also seeks orders requiring that the plaintiff first establish the bona fides of his claim to be the owner of the land where the logs came from before further proceeding in this Court.

The second defendant supported the motion of the first defendant though in fact seeks that it be removed from these proceedings as no cause of action is disclosed against it. The third defendant likewise supports the first defendant, but, adverting to that part of the claim of the plaintiff to have the logging licence declared invalid, seeks orders that the plaintiffs proceed on that issue, by way of judicial review.

In the event the first defendant has not pursued the application to strike out the originating summons, rather it now seeks that the trial date be vacated, on grounds of it having been irregularly obtained, and that the plaintiff be directed to file a full and detailed statement of claim. Defence to be filed thereafter according to the Rules.

Dealing first, with the setting down of this matter for hearing, it is plain that there has been gross breach of the Rules of Court by the plaintiff’s counsel in setting this matter down for hearing. (And I must say enquiries will also be made of the Court Registry).

Counsel for the plaintiff has acknowledged to the Court that this matter was set down for trial when it was known; that the first defendant was not in fact served with notice of intention to apply for setting down for hearing, the first defendant had in fact only just seven days before, filed its notice of intention to defend the claim, and the third defendant had not even been served with the originating summons at all!!.

Counsel for the plaintiff claimed that for his client’s sake it was a matter of urgency to proceed to trial and that ample opportunity was available to the defendants in the month from the 16th of October when the trial date was set till today to take what action it thought necessary(!). That is entirely unacceptable. The Rules of Court have but one purpose and that is to ensure that all parties have due notice of proceedings affecting them to ensure a fair trial.

In fact part of the advantage of the Rules of Court is that they provide flexibility, so that any urgent matter can be dealt with promptly. When matters of urgency arise, the Court recognises that urgency and to ensure prompt attention to the issue at hand (eg an injunction) the technicalities required on the formulation of the basic originating process for example, or the statement of claim, are not necessarily strictly pursued. When time is of essence for the preservation of the status quo, or the protection of a party’s interest that is under threat, such matters can be dealt with when the threat is avoided.

But, when as now, in the clear light of day, the plaintiff’s originating summons simply does not disclose a cause of action it must be struck out or amended. If it were not, then the plaintiff would face an inevitable striking out of the claim at trial. But the first defendants here, has recognised that the plaintiff doesn’t intend to go away and that he wishes to pursue an as yet undefined claim. It therefore merely insists that that claim be put in reasonably clear terms. The originating summons does have to be amended as the first defendant asserts and there will be an order to this effect, if for no other reason then the protection of the plaintiff himself.

Turning to the injunctive orders, I am satisfied on the affidavit evidence now before me (and I must say on evidence that was not available to Mr Justice Los), that there was never any matter of urgency requiring the issue of a Mareva injunction. Just as the plaintiff is not about to go away, neither are the first or second defendants. I am satisfied that both are substantial businesses, the first defendant being of local ownership and management with substantial assets and well able to meet any judgement that the plaintiff is able to obtain against it.

I consider that there was a gross failure to disclose the real nature of the issues between the plaintiff and defendants at the time of application for the orders of injunction. I do not accept the explanation of counsel for the plaintiff that “possibly” the plaintiff didn’t know that the logs were not being loaded a aboard the ship and didn’t know they were not being exported. He did know that the logs had been set aside by arrangement with the defendants, and that in fact the funds frozen, were not funds for the payment of sale of those logs.

The Orders for payment into Court will be set aside and Registrar directed to pay back to the second defendant, the funds held in Court.

The first defendant has also sought orders that the plaintiff be required to establish his claim to the ownership of the land in the Local Land Court before coming to this Court. I do not consider that such a order should be made. Any party may come before the National Court without conditions being imposed. But it may be noted by the Plaintiff that the onus is on him to establish his case on the balance of probability and if his claim of undisputed ownership of the land in question is met by evidence that shows his claim of ownership is still in dispute, then that may well have a significant effect on the success of his claim.

The second defendant also in submission sought an injunction from the Court, directing the plaintiff to abstain from preventing the second defendant from carrying on its business of logging in the area - in particular from blocking the road to enable it to carry on logging in land where there is no dispute. However no application in this regard has been filed by the second defendant and it is a matter which requires specific application and evidence. It might be noted that having voiced this concern, that any application for such orders should be on notice. Subject to the application itself, 24 hours notice should be sufficient.

The third defendant has sought in submissions that the plaintiff proceed by way of judicial review against the third defendant in so far as he claims that the TRP18-2 is invalid. It may be that this would be the appropriate procedure; but until the plaintiff formulates the whole of his claim in a detailed statement, there seems to be no point in making further directions in this case yet.

The net result of what I have said is that the plaintiff is free to pursue his claim in normal manner setting out his claim in full, in a statement of claim understandable to all parties concerned. The matter will proceed to trial according to the Rules of Court. But the plaintiff and his counsel need to be reminded that Court procedure is not available to lock up the opposition so that it is totally unable to operate in a normal business-like way, nor can the Rules used to take other parties by surprise in Court proceedings.

As Los, J said in his Order in October the plaintiff seems to be turning a blind eye on the real world. He should remember that he is asking for the assistance of this Court to have orders made in his favour that will ensure that the compensation he claims is due, is paid. If this is what he wishes to do then he must recognise and respect the Court Rules.

He must also be sensible enough to see that if he wishes to obtain a financial solution satisfactory to himself and his clan, that it must be in their own best interests to let the plaintiffs remain sufficiently financial viable to meet any judgment that they may obtain. There will be accordingly the following orders.

1. Tie tratl df 1 oh Notemberember 1990 is set aside.

2. ; T60 proeeedings in this chis case shall continue by writ and the plaintiff shall file and serve on all parties a full and detailed statement of claim within 2s.

3. ـ E6ch defendant shal shall file and serve its defence within the time prescribed by the Rules of this Court.

4. ټ Allher pdingsl be a be arly conducted within the time times pres prescriescribed bbed by the Rules of Court.

5. &##160; Tjunctrdersentlyorclyorce are dissolved and the Rehe Registrgistrar diar directerected to refund to the second defendant all monies paid into Court.