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Lupari v Sheehan [2009] PGNC 265; N4650 (19 November 2009)

N4650

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS No. 354 OF 2009

BETWEEN:

ISSAC LUPARI
Plaintiff

AND:

CHIEF COMMISSIONER, MAURICE SHEEHAN, COMMISSIONERS JUSTICE CATHERINE DAVANI AND DON MANUA
First Defendants

AND:

HON. SIR MICHAEL THOMAS SOMARE, MP, PRIME MINISTER
Second Defendant

AND:

THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Third Defendant

Waigani: Gavara-Nanu
2009: 17 & 19 November

PRACTICE AND PROCEDURE - Costs - Costs to follow the event -Costs on solicitor and client basis - Discretion of the Court - Circumstances in which costs may be awarded on solicitor and client basis.

PRACTICE AND PROCEDURE - Proceedings before a Commission of Inquiry - Counsel electing not to raise an issue before the Commission of Inquiry but elects to raise and vigorously pursue the issue before the Court - Whether conduct of counsel amounting to negligence- Overall conduct of the counsel - Costs - Discretion of the Court.

PRACTICE AND PROCEDURE - Costs - National Court Rules; Order 22 r 65 - Application of the Rule - Broad and inherent jurisdiction of the Court to order a counsel to pay costs after counsel is given reasonable opportunity to be heard by the Court - Duty to give reasonable opportunity to counsel under Order 22 r 65 of the National Court Rules is on the Court, not on the party seeking costs - Reasonable opportunity - Meaning thereof.

Cases cited:
Papua New Guinea Cases

Alois Malori -v- Investment Corporation of Papua New Guinea and Vai Reva N1466.
Don Pomb Pullie Polye -v- Jimson Sauk Papaki and Electoral Commission of Papua New Guinea [2000] PNGLR 166.
Gulf Provincial Government -v- Baimuru Trading Pty Ltd [1998] PNGLR 311
Island Helicopter Services Ltd –v- Wilson Sagati (2008) N3340
Salvation Army (PNG) Property Trust -v- Jorgen and Rex Vagi N1644

Overseas Cases Cited:

Bahai –v- Rashidian and Another [1985] 1 WLR 1337
The Civil Service Co-operative Society Limited -v- The General Steam Navigation Company [1903] UKLawRpKQB 174; [1903] 2 KB 756
Jones –v- Curling [1884] UKLawRpKQB 79; (1884) 13 QBD 262
Orchard -v- Southeastern Electricity Board [1987] QB 565.

Counsel

N. Tame, for the plaintiff
S. Kassman & G. Gorua, for the first defendant
B. Lai, for the second & third defendants

19 November, 2009

1. GAVARA-NANU J: On 14 August, 2009, the plaintiff's application for leave for judicial review was refused. The plaintiff in making his application raised a number of grounds. All the grounds were dismissed as having no merit.

2. Submissions on costs were heard on 21 August, 2009. This is my ruling on costs. Mr. Gorua of counsel for the first defendant argued that costs should follow the event and that the plaintiff should be ordered to pay costs on solicitor and client basis. Mr. Gorua has raised issue res judicata and told the Court that the plaintiff has re-agitated same issues he has raised in other proceedings which have been duly litigated for which judgments have been given against him both in the National and Supreme Courts and he has been ordered to pay costs, but those costs have not been paid yet. Mr. Gorua therefore argued that this application is unnecessary and is a waste of Courts time and is an abuse of process, he submitted that the first defendant has been dragged in and out of the Court numerous times by the plaintiff with baseless claims. It was submitted that if the plaintiff is ordered to pay costs on solicitor and client basis it will serve as a clear and strong warning to other like minded litigants that the Court will be tough on those who bring ill conceived and baseless applications.

3. Mr. Tame of counsel for the plaintiff on the other hand submitted that the plaintiff should not be ordered to pay costs because he has every right to come to Court and challenge the decisions made by the defendants. Mr. Tame further submitted that the Commission of Inquiry is free to conduct its inquiries and his client's application is not a bar to the Commission from conducting its inquiries. He also submitted that there is no stay order against the Commission from conducting its inquiries, thus, it can continue to conduct its inquiries.

4. Mr Tame also submitted that there are no special circumstances which warrant the Court to order the plaintiff to pay costs on solicitor and client basis.

5. Mr. Gorua in reply reiterated that arguments being put before the Court by the plaintiff are reagitating same issues and arguments he raised in other proceedings which have been dismissed as baseless. Hence, the plaintiff's application for leave is frivolous and vexatious and is a clear abuse of process.

6. An application which is found to be frivolous and vexatious and an abuse of Courts process is a basis for the Court to award costs on solicitor and client basis: Gulf Provincial Government -v- Baimuru Trading Pty Ltd [1998] PNGLR 311.

7. If the application is also based on misapprehension of the role of the Commission of Inquiry or the law, then that is also a basis for the Court to order costs on solicitor and client basis against the plaintiff because the defendants have been dragged into the Court to defend claims which have no basis in law: Concord Pacific Ltd -v- Thomas Nen [2000] PNGLR 47.

8. Mr. Gorua also submitted that costs ordered against the plaintiff on solicitor and client basis should be partly paid by the plaintiff's counsel because the counsel is to be equally blamed for the plaintiff's unmeritorious and baseless application.

9. The Court has the power to order costs against the plaintiff's lawyer, if the lawyer is negligent or has acted improperly in conducting the plaintiff's case. Don Pomb Polye -v- Jimson Sauk Papaki [2000] PNGLR 166.

10. Mr. Tame was given an opportunity by the Court to reply to the submission by Mr. Gorua that he should bear some costs. This submission was made pursuant to O 22 r 65 of the National Court Rules. Mr. Tame argued that the plaintiff had the right to make his application before the Court, thus, costs should not be awarded against him.

11. The Court has a wide discretion in deciding whether to award costs on solicitor and client basis and whether counsel should be ordered to personally pay the plaintiff's costs. In deciding this issue, I have to look at any special circumstances of the case especially those relating to the conduct of the plaintiff and Mr Tame.

12. In deciding the issues raised, I am required to exercise my discretion judicially: Salvation Army (PNG) Property Trust -v- Jorgen and Rex Vagi N1644 and Alois Malori -v- Investment Corpora tion of Papua New Guinea and Vai Reva N1466.

13. I have found that plaintiff's application for leave for judicial review was unmeritorious, hence frivolous and vexatious and is an abuse of process. The underlying reason for coming to this view is the failure by the plaintiff to demonstrate that there are serious legal issues arising from the decisions made by the Commission of Inquiry for which leave could be granted. The plaintiff failed to demonstrate or establish an arguable case in all the grounds he raised in his application for leave for judicial review. The matters or issues he raised were irrelevant, speculative and unsubstantiated, thus the application was unnecessary.

14. The application for leave for judicial review before this Court and the nature of the applications made by the plaintiff before the Commission of Inquiry demonstrate clearly that those applications were made because of plaintiff's misapprehension of the role and the functions of the Commission of Inquiry. The plaintiff has treated the Commission of Inquiry as a court of law when it is not. I do not think the plaintiff appreciates that the Commission of Inquiry is merely a body which is charged specifically to make public inquiries into matters stated under its Terms of Reference. It does not administer justice. See Royal Commissions and Boards of Inquiry (1982), by Leonard Authur Hallet at pp. 8-25. This position was explained to the plaintiff through Mr. Tame by the Commission members numerous times during hearings before the Commission of Inquiry. The plaintiff therefore has no excuse in not appreciating and apprehending the role of the Commission of Inquiry.

15. The plaintiff's application for leave for judicial review was for those reasons found to be frivolous and vexations and an abuse of process. The first defendant in particular was forced to incur unnecessary costs in defending the application which had no merit and its sittings were disrupted, the Counsel Assisting the Commission also wasted valuable time for the Commission when appearing before this Court to defend the plaintiff's application. This is the reason why the Commission could not continue with its work while this Court was sitting and hearing this application. This makes Mr. Tame's argument that this application should not stop the Commission from doing its work untenable.

16. In the circumstances, I accept Mr. Gorua's submission that costs should follow the event and the plaintiff should pay the first defendant's costs on solicitor and client basis. As to the costs for the second and third defendants, I am of the firm opinion that they should pay their own costs as their interests are represented by the Counsel Assisting. I have also noted and accept as correct the submission by Mr. Kassman, the Counsel Assisting that he is acting for the second and the third defendants.

17. In regard to the issue of whether Mr Tame should be personally ordered to pay part of defendants' costs depends on whether there is negligence or improper conduct by Mr. Tame in his conduct of the plaintiff's case.

18. Mr. Tame was given an opportunity to address the Court on allegations of negligence made against him by Mr. Gorua, so the issue of whether he was given a reasonable opportunity to be heard by the Court, as required under Order 22 r 65 (1) of the National Court Rules, does not arise. Mr Tame addressed the Court on the issue based on the materials already before the Court. He had all those materials and is very familiar with them. Thus, having had full knowledge of such materials he had reasonable opportunity to address the Court and be heard on the issue of whether he should be personally ordered to pay costs.

19. In regard to the issue of whether he was negligent and conducted himself improperly in the conduct of plaintiff's case, the answer lies on how he conducted his client's case. It is therefore convenient to look into how he conducted the plaintiff's case before the Commission of Inquiry and before this Court: Don Pomb Polye v- Jimson Sauk Papaki (supra).

20. Having regard to the materials before the Court, I am of the firm opinion that unnecessary costs and expenses have been incurred by the first defendant in defending the plaintiff's application for leave for judicial review and the manner in which Mr. Tame conducted plaintiff's case is largely a contributing factor. The relevant parts of Mr. Tame's conduct of the plaintiff's case relate specifically to his decision to pursue before this Court an issue which he declined to pursue before the Commission of Inquiry. The issue relates to an application made personally by the plaintiff before the Commission asking the Chairman of the Commission to disqualify himself on the basis that the Chairman was biased against him. Mr. Tame expressed a view before the Commission of Inquiry that the application by the plaintiff had no merit. Mr. Tame conveyed his position to the Commission when he explained to the Commission during Commission's hearing that the reason why the plaintiff was making the application personally was because he did not agree with his client raising the issue. In other words Mr. Tame did not agree with his client that the application had any merit.

21. In spite of the position he took before the Commission of Inquiry, Mr. Tame changed his position in these proceedings and decided to plead the same issue and vigorously pursue and argue the issue in this Court on behalf of the plaintiff. I find this conduct unreasonable and improper and it borders on professional misconduct. Mr. Tame also challenged the decision of the second defendant to extend the term of the Commission although the issue was not raised before the Commission. These factors have rendered the plaintiff's application frivolous and vexatious and an abuse of process.

22. From the foregoing it is clear that Mr. Tame has continued to pursue issues which should not have been pursued before this Court. As an officer of the Court he had a duty to raise only issues which have merit and which are relevant and have genuine basis. He has in my opinion conducted himself dishonestly and improperly thus warranting the Court to order costs against him personally. In this regard, I respectfully adopt what the Supreme Court said in Don Pomb Polye's case (supra) when quoting a passage from the judgment given by Sir John Donaldson MR in Orchard -v- South Eastern Electricity Board [1987] QB 565 at 572:

"...this is a jurisdiction which falls to be exercised with care and discretion and only in clear cases. In the context of a complaint that litigation was initiated or continued in circumstances in which to do so constituted serious misconduct, it must never be forgotten that it is not for solicitors or counsel to impose a pre-trial screen through which a litigant must pass before he can put his complaint or defence before court. On the other hand, no solicitor or counsel should lend his assistance to a litigant if he is satisfied that the initiation or further prosecution of a claim is mala fide or for an ulterior purpose or, to put it more broadly, if the proceedings would be, or have become, an abuse of the process of the court or unjustifiably oppressive."(my emphasis).

23. I consider it appropriate that I say a bit more on the opportunity given to Mr. Tame to be heard on whether he should personally pay costs as provided by Order 22 r 65 (1) of the National Court Rules. It is important to note that this Rule relates to "Personal Liability of Solicitor (Lawyer) For Costs". The operative words in r 65 (1) are: "the Court may after giving the solicitor a reasonable opportunity to be heard".

24. This Sub-Rule is a procedural provision which confers discretion on the Court to order costs against a lawyer personally in the circumstances stipulated in that Sub-rule including those stated in r 65 (2). The circumstances in which the Court may order a lawyer to pay costs under this rule are by no means exhaustive.

25. The Court can on its own initiative or on an application made by a party order a lawyer to personally pay costs as long as the lawyer concerned is given a reasonable opportunity by the Court to be heard. The obligation to give a reasonable opportunity to the lawyer concerned is on the Court. This is the essence of r.65 (1).

26. Order 22 r 65 relates to the inherent jurisdiction of the Court to order costs against lawyers who are guilty of improper conduct.

27. The equivalent English Rule is Order 62 r 11. The requirements under that Rule are similar to those under Order 22 r 65 of the National Court Rules: Babai v. Rashidian [1985] 1 WLR 1337.

28. It is important to note that Order 22 r 65 confers power on the Court to order a lawyer to pay costs under circumstances where the lawyer has in his conduct improperly incurred costs and is guilty of misconduct or default. Where circumstances arise under Sub-rule (2) the Court may opt to adopt the procedures set out under the Sub-rule.

29. Giving an opportunity to a lawyer to be heard on an application for such lawyer to personally pay costs under Order 22 r 65 (1) can in my opinion be given verbally to the lawyer by the Court following judgment. And the lawyer can be heard based on the materials already before the Court which the lawyer is already fully aware of and the issue of whether the lawyer should personally pay costs should also be decided on the materials already before the Court.

30. In this regard, it is with greatest of respect that I would generally differ from the view adopted by the Court in Island Helicopter Services Ltd -v- Wilson Sagati (2008) N3340; more particularly on the need for the application for costs against a lawyer to be made by a notice of motion. I am of the respectful opinion that such a process would import a procedural requirement which is quite outside what Order 22 r 65 (1) envisages. To make such an order by the Court would be ultra vires the powers given to the Court by the Sub-rule.

31. There is no doubt that an order awarding costs against a lawyer can affect the integrity and reputation of the lawyer concerned. It is for this reason that Courts should be careful in making such orders and that such orders should be made only in clearest of cases. This would of course require evidence to prove that the conduct of the lawyer has affected the result of the case. As I said such evidence should be already before the Court from the materials already before it and the Court should determine the issue only on the basis of such evidence: Civil Service Co-op Soc. –v- Gen Steam Navigation Co. [1903] UKLawRpKQB 174; [1903] 2 KB 756. The position was best summed up by Lord Justice Bowen in Jones –v- Curling [1884] UKLawRpKQB 79; (1884) 13 QBD 262 at 268 at 272:

"And the view which the Master of the Rolls has put forward of this Order LXV., rule 1, has to my mind the merit that it does not do this, but leaves the matter nearly as the rule itself does. What he has given is not so much a definition as an illustration of the meaning of the rule. It is an attempt to put into other words, but words as wide, the language of the rule, with a view not to limiting or defining it, but expressing what we understand it to mean. The object, of course, is justice should be done. It was felt by the legislature that justice would best be done in jury trials by leaving the costs to follow the event, but that there might be exceptional cases in which that rule would work injustice, and then that the judge should in furtherance of justice be allowed to make an exceptional order. So "good cause" really seems to me to mean that there must exist facts which might reasonably lead the judge to think that the rule of the costs following the event would not produce justice as complete as exceptional order which he himself could make. Now, to ascertain the existence of such facts the judge should look in the first place at the result of the action itself, namely, the verdict of the jury, and he should look also at the conduct of the parties to see whether either of them had in way involved the order unnecessarily in the expense of litigation, and beyond that he should consider all the facts of the case so far as no particular fact was concluded by the finding of the jury; and if upon the whole he reasonably thought there were facts which justified him in thinking that justice would be better arrived at by an exceptional order it would be his duty to make such order". (my emphasis).

32. His Lordship in the above passage was concurring with the observations made earlier by Brett, M.R at 268 where the Master of the Rolls said:

"...it seems to me that the facts must shew the existence of something, having regard either to the conduct of the parties or to the facts of the case, which make it more just that an exceptional order should be made than that the case should be left to the ordinary course of taxation. For example, if the facts shew that there has been misconduct on the part of the plaintiff to this extent, that the fact of his bringing the action is oppressive, or that he has made an exorbitant claim by carelessness or recklessness, they would, to my mind, be such as would be a good cause for a judge interfering. So if the finding of the jury is such that if the ordinary course of taxation were followed it would make the result unjust to either of the parties, then I think that injustice itself would be a just cause which would enable the judge to make an order as to costs." (my emphasis).

33. These observations have been expressed more in the context of a party and party costs, but I consider that they establish a principle which has a general application and it would apply to a case such as the one now before me. They also support and re-enforce the view that the Court should look at the materials already before it when considering whether to order a lawyer to personally pay costs under Order 22 r 65 of the National Court Rules.

34. For the foregoing reasons, I order that Mr. Tame pay part of the first defendant's solicitor and client costs and in the circumstances, I order that he pay half of the first defendant's solicitor and client costs.
______________________________________________
Tame Lawyers: Lawyers for the Plaintiff/ Applicant
Kassman Lawyers: Lawyers for the Defendants/Respondents