N2599

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

APP. NO. 299 OF 2001

PETER KIRIN AND KK FARMERS
Appellants

AND:

JOHN PARODA
Respondent

GOROKA:		KANDAKASI, J.
2004:	17th and 27th August

APPEALS – PRACTICE & PROCEDURE – Appeal from District Court – Grounds of Appeal – Pleading of – Must be specific – General or broad ground of appeal stand risk of dismissal – District Courts Act ss. 232. 

EMPLOYMENT – Informal contract of employment – No contest as to existence of contract – Dispute on terms and conditions of employment – No record of terms noted, kept and produced by employer – Evidence of terms given by employer conclusive – Employment Act (Chp. 373) s. 15.

AGENCY – Business partner entering into contract with third party – Apparent and ostensible authority – Principle failing to give notice of lack of – Evidence of agency not disputed or rebutted - Agency established – Agents representations binding on principle.

Papua New Guinea Cases Cited:
David Coyle & 2 Ors v. Loani Henao (30/11/00) SC655.
State v The Independent Tribunal Ex Parte Sasakila [1976] PNGLR 491.
Misima Mines Ltd v. Collector of Customs (18/12/03) N2497.
Dempsey -v- Project Pacific Ltd [1985] PNGLR 93.
MVIT v. James Pupune [1993] PNGLR 370.
PNGBC v. Jeff Tole (27/09/02) SC694.
Jimmy Ono v. The State (04/10/02) SC698.

Overseas Cases Cited:
Taylor v. John Summers & Sons Ltd (1957) 1 WLR 1182.

Counsel:
Appellants in Person (Peter Kirin)
Respondent in Person

27th August 2004.

KANDAKASI J:	On 30th November 2001, the Goroka District Court entered a K4,050.00 judgment against the Appellants, Peter Kirrin and KK Farmers. That was for alleged unpaid wages or salary on the complaint of the Respondent, Mr Jon Paroda. The District Court found after a trial that, the parties were in an informal employment relationship where the Appellants were the employers and the Respondent was an employee. The District Court also applied the provisions of s.15 of the Employment Act (Ch. 373) and found that it was a term of the contract that the Respondent would be paid K500.00 per fortnight in the absence of the Appellants as employers noting, keeping and producing the relevant records of the terms and conditions of employment.

The decision aggrieved the Appellants and they lodged an appeal to this Court. After all the formalities, the appeal came before me for hearing on 17th August 2004. I heard the appeal on that day and reserved a decision to today.

The Appeal

The Appellants Notice of Appeal pleads three grounds of appeal. These are:

"(i)	…[T]here was no credible evidence adduced by the Respondent for the Court to arrive at the conclusion it arrived at.

(ii)	… [T]here never existed a legally binding contract between the Appellants and the Respondent for him to be paid K500.00 a fortnight.

(iii)	… [T]he calculations made by the Respondents which was upheld by the Court and ordered to be paid by the Appellant were based on wrong principles and the right calculations shall have been based on rates by Department of Labour."

I am of the view that the first and second grounds require an examination of the evidence adduced before the District Court. I will therefore deal with these grounds together, subject to addressing the issue of competency of the first ground. The third ground is dependant on a decision on the first two grounds. Thus, I will take that up after determining the first two grounds.

(i)	First and Second Grounds of Appeal

The first ground of appeal, in my view, is too general. Section 221 (1) requires an appellant to "state the nature of the grounds of appeal". The law generally requires a party in any Court proceeding to be specific and clear in his or her pleadings. In the case of appeals, the law generally is that, it is not sufficient to allege that the trial judge fell into error. An appellant must state in his statement of the grounds of appeal where and how the trial judge fell into error. The Supreme Court Rules clearly expressed this principle in the context of appeals from the National Court to the Supreme Court.

Order 7 r 8(c) states that a notice of appeal shall "state briefly but specifically the grounds relied upon in support of the appeal". The next rule, r 9 then states that:

"[I]t is not sufficient to allege that judgment is against the evidence or the weight of the evidence or that it is wrong in law, and the notice must specify with particularity the grounds relied on to demonstrate that it is against the evidence and the weight of the evidence and the specific reasons why it is alleged to be wrong in law."

Early judicial pronouncement of this principles appear for example in the case of Taylor v. John Summers & Sons Ltd (1957) 1 WLR 1182. In that case, the notice of appeal simply stated as one of its grounds of appeal that the trial judge misdirected himself. The respondent found it difficult to prepare his case in response and requested further and better particulars. At p. 1184 Jenkins LJ said, referring to counsel’s submission:

"He relies in particular on paragraph 1 of the grounds of appeal:…‘That the judge misdirected himself in law and on the facts; and he draws an analogy between the particulars required of a motion for a new trial. He has referred us to Pfeiffer v Midland Railway Co.,5 where it was held that:’ A notice of motion for a new trial on the ground of misdirection should state how and in what manner the judge misdirected the jury;’ and it appears from the judgement of Huddleston B. that the only objection stated in the original notice of motion was misdirection. One can appreciate that a general allegation of misdirection, without saying in what respect and the judge misdirected the jury, might well be held (as it was held in that case) to be insufficient."

His Honour then concluded at p.1185:

"From those authorities it seems to me to be reasonably plain (if authority were needed) that if the only ground alleged in the notice of appeal in the present case had been the first- namely, that the judge misdirected himself in law and on the facts — that, standing alone, would not have been sufficient notice of the grounds of appeal.."

The Supreme Court adopted and applied these principles in David Coyle & 2 Ors v. Loani Henao (30/11/00) SC655. In so doing, it said in the context of the case before it:

"The Appellants have not addressed the issue of competency as raised by the Respondent but have pursued this appeal in an attempt to knit-pick possible errors that the trial judge may have fallen into which in whole may have affected His Honour's sound evaluation of the case in an objective manner. But the court is not going to waste its time to direct its mind to this submission particularly when the issues of law raised are founded upon the same defective or incompetent ground of appeal.
									(Emphasis supplied)

In the case before me, the first ground of appeal does not say where or how the learned magistrate fell into error or arrived at its conclusion against the weight of the evidence. For example, it does not state what the evidence was and what kind of conclusion the evidence supported. Instead of doing that, this ground of appeal is trying to get this Court to go through the whole of the decision and evidence adduced in the Court below and try and knit pick every error there might be without the appellants specifying what they are first from the outset.

The appeal process is there not to enable an aggrieved party to have a second rehearing of the whole case after a court of competent jurisdiction has dealt with the matter on its merits. A decision after that process resolves and should resolve the matters in dispute between the parties subject to an aggrieved party’s right of appeal on very good grounds or reasons. The process is therefore, there to enable a party, which has a genuine and meritorious ground to challenge the decision of the Court below. It is thus necessary for such a party to specify with sufficient particulars the grounds or reasons for his appeal. This would enable the opposing party to know at the outset the basis for the appeal, prepare, and present his or her response or where possible, consent the relief sought. At the same time, it enables the appellate Court to know the basis of the appeal and determine whether it is meritorious or not. This is important in the case of appeals from the District Court to the National Court because of s. 230 of the District Courts Act. This provision provides that "if it appears to the National Court that there has been a substantial miscarriage of justice", it can uphold an appeal.

It follows therefore that, where a purported ground of appeal is too general and not specific on the real basis for the appeal, it stands the risk of a strike out or dismissal for not disclosing a reasonable ground of appeal. In the present case, I find for the reasons stated above that, the first ground of appeal is too general. This is apparent from the submission of the parties. The appellant gets into the specific argument of there being no evidence of any legally binding contract between them and the Respondent and an argument that there was no evidence of a Vincent Kautu not being their agent. This are obviously, matters not raised any where in the grounds of appeal. On the other hand, because of the generality of this ground of appeal, the Respondent argues general terms too.

In the circumstances, I find that the Appellants are raising issues not stated in their grounds of appeal. The Appellants did not apply for and obtained leave to include these additional grounds of appeal. Meanwhile, the time for them to appeal on those specific grounds have long expired without them properly exercising their right of appeal in accordance with the provisions of the District Courts Act. Hence, I find that, raising these points in their submission does not rectify the fact that the first ground of appeal is too general. In the end therefore, I find that, the first ground of appeal is not a valid ground of appeal. Accordingly, I order a dismissal of this ground of appeal.

Even if I was wrong in arriving at the above decision (which I say am not) the arguments that, there was no legally binding contract between the Appellants and the Respondent and Mr. Vincent Kautu not being an agent of the Appellants are not supported by the pleadings and evidence adduced in the Court below.

In paragraph 4 of the Respondent’s statement of claim, he claimed commencing employment with the Appellants on or about September 2000. The Appellants admitted that allegation in paragraph 4 of their Defence and Counter Claim. Then in paragraph 5 of Mr. Kirin’s affidavit sworn on 14th November 2001, he deposed to the Respondent being employed as a sales supervisor on a fortnightly salary of K300.00 and K550.00 per month for accommodation. On these pleadings and facts, there can be no dispute that there was a binding employment contract between the Appellants and the Respondent.

The only point that seems to be in issue between the parties, according to the evidence before the District Court is, the fortnightly salary. As noted, the Appellant’s say the agreed fortnightly salary for the Respondent was K300.00. On the other hand, the Respondent argues that, the agreed salary was K500.00. According to the Respondent’s evidence, Mr. Vincent Kautu, who was a business partner or agent of the Appellants offered and he accepted a salary of K500.00. The Appellants response to that is that, Mr. Kautu was not their servant or agent as Mr. Kautu was an employee of Farmset. In so arguing, the Appellants say nothing in relation to the Respondent’s evidence that, the initials "KK" in KK Farmers Hardware stands for Kautu and Kirrin representing their joint interest in the business. The Respondent knows this from his prior dealing with Mr Kautu. At that time, the Respondent was an employee of Agmark Pacific in Lae who sold a number of wholesale items to Geha Farmers Hardware, the predecessor to KK Farmers Hardware.

The evidence before the District Court reveals that Peter Kirrin is the proprietor of KK Farmers Hardware, which is not a registered company but only a business name. Mr Kirrin did not accept that Mr Vincent Kautu was a director or his partner in KK Farmers Hardware. Yet he admitted to Mr. Kautu being an advisor to his business operations. Further, Mr Kirrin did not specifically rebut the Respondent’s evidence that, Agmark terminated his employment because of slow payments on credit sales he made to businesses owned and operated by Mr Kautu, Mr Kirrin and a Mr Nigil Harie due to conflicts between Mr. Kautu and Mr. Harie. Furthermore, Mr. Kirin also did not rebut the Respondent’s evidence of Mr. Kautu being the brain and main person behind KK Farmers. Similarly, Mr. Kirin did not rebut the obvious inference that, the Respondent’s employment by the Appellants was in effect an acceptance of responsibility for having his previous employment terminated.

These facts remain undisputed. Added to that is an admission by the Appellants that they employed the Respondent as a sales supervisor on a fortnightly salary of K300.00 and K550.00 per month for accommodation. That was on the recommendation or advice of Mr. Kautu. On these facts, I find that, Mr. Kautu was a business partner and agent of Peter Kirin and KK Farmers Hardware. There is no evidence of the Appellants disclosing to the Respondent that Mr. Kautu was not their agent. Similarly, there is no evidence of the Appellants disclosing to the Respondent that Mr. Kautu did not have the apparent or ostensible authority to make representations on their behalf. Such a disclosure was necessary given the undisputed fact that the Respondent had prior dealings with Mr. Kautu on behalf of the Appellant and the Respondent took him as the brain and person behind the Appellant’s business operations.

Other evidence in the depositions show that, the relationship between the parties as employer and employee respectively existed for about 14 fortnights. The Appellant paid and the Respondent received a salary of K300.00, which was K200.00 short of K500.00. The Appellants say the Respondent did not complain over that pay and so therefore, this confirms their claim that the agreed fortnightly salary was K300.00. This gave rise to the issue before the District Court as to what was the agreed fortnightly salary.

The learned magistrate found that, there was a definite offer of employment by Mr. Kautu for and on behalf of the Appellants, with a salary package that included a fortnightly salary of K500.00. The learned magistrate also found that, notwithstanding, the agreed salary, the Respondent was in fact paid K300.00 per fortnight, K200 short of the agreed K500.00. The learned magistrate reasoned, again based on the evidence before him that, the Appellants employed the Respondent at a time when he was jobless and that K300.00 was better than nothing, given that he had a family to look after. In these circumstances, I find that the learned magistrate did not fall into any error when he arrived at that finding. 

Further, even if the above finding was not correct there is a further reason favouring a finding that the agreed fortnightly salary was K500.00 and not K300.00. This is apparent from the fact that the employment contract in this case was not a formal written contract of employment. There were no exchange of a written letter of offer and acceptance to and from the parties. Hence, this was an informal contract of employment. Therefore, as the learned magistrate found, the provisions of s. 15 of the Employment Act (Chp. 373) apply. That provision provides:

"15.	Record of terms, etc., of employment.

(1)	Where an employer and an employee enter into an oral contract of service, the employer shall, at the time of the engagement, make a written record of the terms and conditions of the contract.

(2)	Where a dispute arises as to the terms and conditions of an oral contract of service, and the employer fails to produce a record under Subsection (1), a statement by the employee as to the terms and conditions of the contract shall be conclusive evidence of those terms and conditions unless the employer satisfies the Secretary or an Arbitration Tribunal established under the Industrial Relations Act to the contrary."
								(Emphasis supplied)

The words of this provision are very clear. There is ample authority for the proposition that the Courts must look at upholding the intention of Parliament when it comes to the interpretation and application of a statutory provision. Kearney, J in the State v The Independent Tribunal Ex Parte Sasakila [1976] PNGLR 491 at 506, speaking in the context of the provisions of the Constitution said:

"The ‘dynamic character’ of the Constitution is emphasized; in interpreting the laws the judges are urged to use ‘judicial ingenuity’ in appropriate cases, to do justice. One consequence of this approach to interpretation is that the Court should not fail to give a provision the effect it considers the Parliament intended, by applying a literal or ‘plain meaning’ test nor should it attribute to the legislature an intention to produce a capricious or unjust result. The search throughout is for the intention of Parliament, a process which remains, formally at least, one of interpretation and not legislation, and one in which the best guide remains the provisions of the Act itself."
							(Emphasis supplied)

What this means, in my view, is that the Courts should endeavour to uphold the intent of Parliament in any legislation. It means therefore, that if the plain literal meaning of the words used by Parliament can best uphold the intent of Parliament in the legislation under consideration, they must allow them to apply instead of complicating it by the technical rules of statutory interpretation: See Misima Mines Ltd v. Collector of Customs (18/12/03) N2497 for some more discussion on this.

In the present case, the words used in s.15 of the Employment Act is so plain and clear that it requires no detailed interpretation. Subsection (1) obligates an employer to record the terms and conditions on which a person is employed in the case of informal or oral contracts. The aim here is to achieve certainty in the terms and conditions of one’s employment in informal contracts. If an employee fails to do that, and fails to produce the records in the case of a dispute as to the terms and conditions of employment, than the next subsection provides that whatever, an employer says as to his or her terms and conditions of employment, are conclusive. I note that, in both subsections the mandatory or obligatory "shall" is used. This leaves no room to excuse an employee who fails to adhere to these requirements, except as provided.

In the present case, the Appellants, being the employers of the Respondent did not record at the time of employing him the terms and conditions on which they were employing him. Mr. Kirin confirmed this when I asked him as to whether he recorded the terms and conditions on which the Appellants employed the Respondent. Consequently, he did not produce any such records before the District Court. In those circumstances, what the Respondent said in relation to the terms and conditions of employment with the Appellant was conclusive. Hence, I am of the view that, the learned magistrate made no error when he found that, the Appellants employed the Respondent on a fortnightly salary of K500.00.

The upshot of all of these is that, the first and second grounds of appeal are without merit. Accordingly, I order a dismissal of these grounds. This effectively leaves the Court to deal with the third ground of appeal, which is the only remaining appeal ground for this Court to deal with. 

(ii)	Third Ground of Appeal

The Respondent argues that this ground must fail. This is because he says the Appellants did not raise it in the Court below. Therefore, they are at no liberty to raise it for the first time before this Court on appeal. He also argues that in any case, the Appellants did not produce any evidence to rebut this evidence on the amounts he claimed as unpaid entitlements and therefore his damages. In these circumstances, he argues for a dismissal of this ground of appeal.

The Appellants do not raise any argument against the first part of the Respondent’s argument. As for the second part, the Appellants, argue only in turns of the Respondent failing to produce a calculation by or one endorsed by authorities such as the Department of Labour. The suggestion there is that the Respondent or any other person cannot come up with the kind of calculation the Respondent has produced.

Turning firstly to the first part of the argument, I note that the law on raising issues not raised at the trial level and raised for the first time on appeal is very clear. This appears from a number of Supreme Court judgments on point. One of the first cases was Dempsey -v- Project Pacific Ltd [1985] PNGLR 93. In that case, the appellant raised and succeeded on a major point, raised for the first before the Supreme Court on appeal. That was a case in which an application to set aside a judgement was refused by the trial judge. On appeal to the Supreme Court, the appellant raised a new matter for the first time on the question of whether the claim was properly for a "liquidated demand". The respondent in that case did not object to the new matter raised on appeal and the appeal. Therefore, the Court decided the appeal on the new matter. 

In its subsequent judgment in MVIT v. James Pupune [1993] PNGLR 370, the Supreme Court referred to the above judgment and distinguished it on the basis that, in the MVIT case, counsel did not object to matters introduced in evidence that had no foundation in the pleadings. The Court reasoned that, by its conduct the MVIT allowed the trial to include matters not pleaded which meant that the issue of pleadings was an issue in the trial.

More recent judgments of the Supreme as the ones in, PNGBC v. Jeff Tole (27/09/02) SC694 and Jimmy Ono v. The State (04/10/02) SC698, show that, an appellant is not at any liberty to raise an issue or point for the first time in his appeal without first raising it in the Court below. Both the Supreme Court and this Court have in the past dismissed a number of grounds of appeal based on this principle. 

Given that position, the question in this case is, is the third ground of appeal raising an issue for the first time that was not an issue in the Court below? This requires a perusal of the District Court records. A careful perusal of the file, fails to reveal that the issue of correct calculation of the Respondent’s unpaid entitlements was not an issue before the District Court. It is obvious that, most of the focus was on the liability aspects of the Respondent’s claim. Indeed, it seems, the Appellants ignored this part of the claim. They produced no contradicting calculation from the Department of Labour as is suggested, now in the context of this appeal or from any other authority. Instead of producing evidence against the Respondent’s claim, the Appellants produced in the form of annexure "C1"to the affidavit of Mr. Kirin the Respondent’s calculation of what was due to him on termination or at the end of his employment contract.

The Court below found there was sufficient evidence on the required standard of prove, balance of probabilities, that the Respondent made out his claim in the sum of K4, 050.00. I cannot find any trace of any error. The District Court was obliged to go by the evidence before it. I know of no law that precludes a person in the shoes of the Respondent calculating his loss. The law instead as far as I know, obliges complainants or plaintiffs like the Respondent to calculate and specify the precise extent of his or her loss. Accordingly, I find that the learned magistrate correctly assessed and awarded that amount in damages to the Respondent. It follows therefore that, the third ground of appeal is without merit. Hence, I also order a dismissal of the third ground of appeal.

This leaves the appeal with no ground to stand on. Consequently, I order a dismissal of the appeal with costs to follow that event.
____________________________________________________________
Appellants in Person (Peter Kirin)
Respondent In Person