N5397

PAPUA NEW GUINEA
IN THE NATIONAL COURT OF JUSTICE

CIA 19 OF 2006

BETWEEN:

PACIFIC EQUITIES & INVESTMENTS LIMITED
Applicant

AND:

TEUP GOLEDU, the Chairman Securities Commission of PNG
First Respondent

AND:

MELANESIAN TRUSTEE SERVICES LIMITED
Second Respondent

AND:

NATIONAL SUPERANNUATION FUND LIMITED
Third Party Applicant

Waigani: Hartshorn, J.
2008: 14th May,
: 14th July

Notices of Motion for dismissal of Securities Act Appeal to the National Court for want of prosecution

Cases cited:

Tege Kai Ulo v. Acting Public Prosecutor & Anor [1987] PNGLR 148
Credit Corporation (PNG) Pty Ltd v. Tabua [1990] PNGLR 166 
Joe Chan and PNG Arts v. Matthias Yambunpe (1997) SC 537 
Papua New Guinea Electricity Commission v. Joseph Amban (2004) N2666 
PNG Nambawan Trophy Ltd v. Dynasty Holdings Ltd (2005) SC811 
Yama and Ors v. PNGBC Ltd (2008) SCA110/04, 9th July 2008, Waigani. 

Counsel:

Mr. S. Javati, for the Appellant 
Mr. R. Raka, for the First Respondent
Mr. D. Koeget, for the Second Respondent
Mr. N. Pitoi, for the Third Party Applicant

14th July, 2008

1. HARTSHORN, J: The appellant Pacific Equities & Investments Limited (PEIL), commenced these proceedings on the 20th February 2006 (Appeal). It is an appeal under s.13 Securities Act 1997 against decisions of the first respondent, the chairman of the Securities Commission (Commission), including a decision to direct the second respondent, Melanesian Trustee Services Limited (MTSL), to terminate the appointment of PEIL as fund manager of the Pacific Balanced Fund and the Pacific Property Trust.

2. The Commission seeks dismissal of the Appeal for want of prosecution as does the third party applicant, National Superannuation Fund Ltd (Nasfund) in a separate notice of motion which also seeks other relief.

3. Leave had been granted to Nasfund in terms of paragraph 1 of its notice of motion, to be added as a party. MTSL supports the applications to dismiss while PEIL opposes both motions.

Dismissal for want of prosecution

4. Counsel for the Commission was granted leave to amend his client's motion to read Order 10A Rule 25 of the National Court (Commercial List) Rules instead of Rule 23. Nasfund relied on Order 18 Rule 12 (4)(1)(a) National Court (Appeal) Rules 2005, Order 10A Rule 23 of the National Court (Commercial List) Rules 2005, Order 10 Division 1 Rule 9A (15)(1)(a) of the National Court (Listing) Rules 2005 and the inherent jurisdiction of the court to summarily determine proceedings or dismiss them for want of prosecution.

5. Counsel for PEIL initially objected to the Commission's application to dismiss on the basis that it lacked jurisdictional basis and was therefore incompetent. This objection was to the reliance upon Order 10A Rule 23. Counsel for PEIL was not present when counsel for the Commission had successfully sought leave to amend the National Court Rule upon which his client relied to Order 10A Rule 25 and when leave for Nasfund to be added as a party as referred to, had been confirmed. Upon being informed of leave to amend being granted to the Commission, counsel for PEIL did not continue with his objection.

6. In the submissions for PEIL it is contended that the relevant law for the purposes of the Commission's application to dismiss for want of prosecution is Order 10 Division 1 Rule 9A (15)(1) and (2). Given that is one of the rules relied upon by Nasfund in its application which is supported by the Commission and MTSL, it is not necessary to consider PEIL's objection further.

7. Counsel for PEIL further contended that Order 10 Division 1 Rule 9A (15)(1) and (2) is similar to Order 4 Rule 36 National Court Rules which provides for dismissal of a proceeding for want of prosecution and which gives a wide discretion to the court to dismiss proceedings but that the exercise of that discretion must be exercised on proper principles.

8. As to the actions taken by PEIL to prosecute the Appeal since it was filed, it was contended on behalf of PEIL that:

a) the Appeal was set for hearing in August 2006 and that all relevant affidavits, statements of agreed and disputed facts, appeal books and extracts of submissions had been filed as per the directions and orders of the court.

b) the hearing dates were vacated sometimes by consent and at other times by the court.

c) other events contributed to the delay in prosecuting the Appeal.

d) PEIL has not defaulted in complying with any court direction or order.

e) the Appeal has been ready for hearing since August 2006.

9. Counsel for the Commission, MTSL and Nasfund contended that:

a) this is a 'case stated' process of appeal dealing only with arguments on the law.
b) the short time periods provided in the Securities Act suggest that it is intended that appeals under s.13 are to be dealt with quickly and expeditiously.
c) the National Court Rules concerning appeals which are invoked in the Notice of Appeal also suggest that it is intended that such an appeal is to be progressed expeditiously.
d) the Order in the Appeal of the Deputy Chief Justice dated 29th June 2006 (DCJ Order) provided inter alia, that PEIL was to take steps to prosecute the Appeal in the July 2006 sittings of the National Court, failing which the Appeal should be considered for summary determination in the August 2006 sittings.

10. The conduct of PEIL since filing the Appeal, it is contended by the Commission, MTSL and Nasfund, is and should be described as follows:

a) PEIL has had time on numerous occasions to seek the court's assistance for interim relief, or to argue against the setting aside of interim relief previously granted but has avoided progressing the Appeal to hearing.

b) no valid reasons are given for not prosecuting the Appeal expeditiously

c) there is default in complying with the DCJ Order in not having the matter set down for hearing in July 2006.

d) the delay in prosecuting the Appeal is contumelious and that this is evident as there is no evidence of any correspondence between PEIL's lawyers and the National Court, no evidence of there being any approaches to the National Court Registry, no evidence of attending call overs since 3rd August 2006 and no attempt to have the Appeal listed in the listings list. 

e) the Managing Director of PEIL Mr. Ruimb's affidavit evidence is essentially that he was too busy to deal with the Appeal.

f) that Mr. Ruimb was more concerned with obtaining interim stays and injunctions based on the Appeal than prosecuting the Appeal substantively.

Law

11. The principles to be applied by the court in considering whether to dismiss proceedings under the various relevant National Court Rules and under its inherent jurisdiction to control its own proceedings, are similar.

12. Those principles are applicable in cases seeking the dismissal of proceedings for want of prosecution generally and appeals from the District Court to the National Court and from the National Court to the Supreme Court.

13. To my mind, there should not be any reason why an application to dismiss an appeal from a body such as the Commission to the National Court for want of prosecution should warrant a consideration of different principles than those to be considered on an application for the dismissal of an appeal from the District Court to the National Court for want of prosecution.

14. In the case of Papua New Guinea Electricity Commission v. Joseph Amban (2004) N2666, which concerned an application to dismiss an appeal from the District Court, Sawong J. said that the law relating to dismissal of appeals from the District Court to the National Court for want of prosecution was now fairly settled. The principles include that the court has a discretion to dismiss for want of prosecution where there is undue delay and what constitutes undue delay depends on the circumstances of each case. The onus is on the applicant to dismiss, to establish the prime facie case of delay. The Supreme Court cases of Tege Kai Ulo v. Acting Public Prosecutor & Anor [1987] PNGLR 148 and Credit Corporation (PNG) Pty Ltd v. Tabua [1990] PNGLR 166 were cited. 

15. The Supreme Court case of Joe Chan and PNG Arts v. Matthias Yambunpe (1997) SC 537 is authority for the proposition that the principles discussed by the Supreme Court in applying Order 7 Rule 53 Supreme Court Rules are just as relevant and authoritative in an application to dismiss an appeal from the District Court to the National Court.

16. That Rule places the onus on the appellant to prosecute its appeal with due diligence. One of the latest Supreme Court cases to consider Order 7 Rule 53 is Yama and Ors v. PNGBC Ltd (2008) SCA110/04, 9th July 2008, Waigani. In that case the Supreme Court case of PNG Nambawan Trophy Ltd v. Dynasty Holdings Ltd (2005) SC811 was cited as summarising the various propositions that are to be considered. The following are relevant for our purposes: 

(1)	An appeal may be struck out if it is not set down as required by the rules and the power to dismiss in this instance remains discretionary.

(2)	The discretion is to be exercised having regard to all the circumstances of the case including inter alia, the length and reasons for delay on the appellant's part.

(3)	Where the applicant has established failure on the part of the appellant to do an act the onus then shifts to the appellant to explain the failure to do the act or the delay.

(4)	Matters relevant to the want of due diligence include failure to promptly serve the Notice of Appeal, failure to attend on settlement of the appeal book, failure to explain non attendance and failure to provide any explanation for dilatory conduct where an explanation could properly be expected. The absence of explanation is fatal to a respondent to an application for dismissal where an explanation could quite properly be expected.

(5)	The discretionary powers should not be exercised in favour of the respondent (to the application) where no explanation for want of due diligence is made. That a lawyer cannot be present because he is appearing before another judge may be an adequate explanation.

(6) The Court must consider the whole of the circumstances in which an application for dismissal on the grounds of want of prosecution is brought, in particular, events that have taken place since the application was filed. The application to dismiss should be prosecuted with due diligence. Where an appellant has not done what the Rules require in the time required, but has made good its omissions before the application to dismiss is heard, the application may not be successful.

This Appeal

17. Paragraph 2 of the DCJ Order is as follows:

"The Appellant takes steps to prosecute the appeal in the July sittings of the National Court, failing which the Registrar should place the matter on the summary determination list to be summarily determined in the August sittings of the National Court."

18. The onus was on PEIL to prosecute the Appeal promptly from the date that it was filed and even more so after the DCJ Order.

19. What has PEIL down to prosecute the Appeal since it was filed about 2 years 3 months ago and about 2 years since the DCJ Order was made? The Appeal was set down to be heard before the Deputy Chief Justice on 3rd August 2006, but this date was vacated on 1st August 2006. On a later date, the matter was apparently adjourned to 7th September 2007 for a pre-trial conference, but nothing seems to have occurred before and since then apart from the hearing of various motions. The hearing of these motions concerning whether interim relief should be granted or continued and whether there was an apprehension of bias such that I be disqualified from hearing inter alia, matters relating to this Appeal, together with whatever the decisions of the court would be, would not have prevented PEIL from progressing the hearing of the Appeal. 

20. Mr. Ruimb the Managing Director of PEIL, deposes inter alia, at paragraph 6(s) of his affidavit dated 6th December 2007 that:

"The Appellant has not done anything deliberately to delay the prosecution of the appeal….."

It is apparent however that PEIL has not done anything deliberately to progress the prosecution of the Appeal.

21. Since the Appeal was filed, PEIL has had the time to make various applications for interim relief but has not progressed the hearing of the Appeal even though it is contended that the Appeal has been ready for hearing since August 2006. It is noteworthy that no action has been taken to have the Appeal heard since the present motions seeking dismissal were filed in November 2007. It is not a valid excuse as referred to earlier, to argue that PEIL was waiting for an interim decision of this court to be delivered.

22. There is no evidence in the affidavits in opposition to the motions for dismissal of any correspondence between PEIL's lawyer's and the National Court and no evidence of any approaches to the National Court Registry since 3rd August 2006, concerning progressing the Appeal to hearing. This does not demonstrate behaviour on the part of the lawyers for PEIL to actively progress the hearing of the substantive Appeal.

23. On the evidence before me I am satisfied that there has been a lengthy delay in prosecuting this Appeal which was filed about 2 years 3 months ago. The reasons given for the delay are not in my view reasonable, especially when regard is had to the ability of PEIL to make numerous applications in this Appeal and in related proceedings, the need to prosecute the Appeal promptly, especially given the DCJ Order and the fact that PEIL contends that the Appeal has been ready since August 2006.

24. I am satisfied that it has been established that there has been failure by or on behalf of PEIL to properly prosecute the Appeal and PEIL has not adequately, reasonably and properly explained this failure.

25. The Commission is prejudiced by the delay as it has been unable to properly perform its functions in regard to PEIL and related matters because of the restraining orders in force pending hearing of the Appeal.

Conclusion

26. It was incumbent upon PEIL to take all necessary steps to prosecute this Appeal especially after the DCJ Order. It clearly has not.

27. The explanations given on behalf of PEIL in my view are not satisfactory. They do not adequately explain the delay in prosecuting the Appeal. An appellant itself and by its lawyers has a duty to the court as well as the respondents in an appeal, to have an appeal set down for hearing as promptly as possible.

28. PEIL has not prosecuted its appeal with due diligence and has not offered adequate explanations for the delay. It has not taken any steps to progress the appeal between the filing of the applications for dismissal and their hearing. In my view there is no basis on which the court can exercise its discretion in favour of PEIL. This proceeding is dismissed for want of prosecution. Costs of the notices of motion of the first respondent and third party applicant seeking dismissal are to be paid by the appellant to the first and second respondents and the third party applicant.

Mawa Lawyers: Lawyers for the Appellant
Elemi Lawyers: Lawyers for the First Respondent
Gubon Lawyers: Lawyers for the Second Respondent
Gadens Lawyers: Lawyers for the Third Party Applicant