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Suan v Dumba [2013] PGNC 211; N5428 (22 November 2013)

N5428

PAPUA NEW GUINEA
IN THE NATIONAL COURT OF JUSTICE

WS NO 448 OF 2007

TEDDY SUAN
Plaintiff

V

PETER DUMBA, MANAGING DIRECTOR, MADANG WRECKERS LIMITED
First Defendant

MADANG WRECKERS LIMITED
Second Defendant

Madang: Cannings J
2013: 16, 22 August, 22 November

DAMAGES – breach of contract for repair of motor vehicle: vehicle sold by repairer – claim for reimbursement of money paid by customer to repairer and for value of vehicle sold by repairer.

The plaintiff engaged the defendants to repair his motor vehicle and paid money to them as part-payment of the repair cost. There was a substantial delay in repairing the vehicle and by the time the plaintiff went to collect it, the defendants had sold it, claiming that they had done so on the instructions of the plaintiff's wife as the vehicle was occupying space in their workshop and the plaintiff owed them money for repair and storage costs. The plaintiff commenced proceedings against the defendants, claiming damages for breach of contract. Default judgment was entered against the defendants and a trial on assessment of damages was conducted. The plaintiff claimed two categories of damages: (a) replacement value of the vehicle, K15,000.00; and (b) reimbursement of money paid to the defendants, K23,730.91. The defendants submitted that nothing should be awarded as they had incurred costs of K35,000.00 repairing the vehicle and in addition absorbed storage fees of K7,200.00, the result of which was that the plaintiff owed them K18,228.17.

Held:

(1) The presumption arises on entry of default judgment that the judgment resolves all questions of liability on the matters pleaded in the statement of claim.

(2) Here the facts and cause of action were clear: there was a motor vehicle put in for repair, money was paid as part-payment, a contract was entered into, the defendants breached the contract and were liable in damages. The arguments now being raised by the defendants are defences which they have lost the right to argue.

(3) The plaintiff was entitled to the two categories of damages claimed, there being sufficient evidence of each: K15,000.00 + K23,730.91 = K38,730.91.

(4) Interest was awarded on the total amount of damages calculated at the rate of 8% per annum from the date of entry of default judgment to the date of judgment: K2,695.61, making the total judgment sum K41,426.52.

Cases cited

The following cases are cited in the judgment:

Banduwara Waranumbo v Hyper Construction Limited (2012) N4882
William Mel v Coleman Pakalia (2005) SC990

TRIAL

This was a trial on assessment of damages for breach of contract.

Counsel

O Ore, for the plaintiff
D F Wa'au, for the defendants

22nd November, 2013

1. CANNINGS J: This is an assessment of damages for breach of contract following entry of default judgment.

2. The plaintiff engaged the defendants to repair his motor vehicle and paid money to them as part-payment of the repair cost. There was a substantial delay in repairing the vehicle and by the time the plaintiff went to collect it, the defendants had sold it, claiming that they had done so on the instructions of the plaintiff's wife as the vehicle was occupying space in their workshop and the plaintiff owed them money for repair and storage costs. The plaintiff commenced proceedings by writ of summons on 30 April 2007 against the defendants, claiming damages for breach of contract. Default judgment was on 7 January 2013 entered against the defendants and a trial on assessment of damages has been conducted.

3. The plaintiff claims two categories of damages: (a) replacement value of the vehicle, K15,000.00; and (b) reimbursement of money paid to the defendants, K23,730.91. The defendants argue that nothing should be awarded as they had incurred costs of K35,000.00 repairing the vehicle and in addition absorbed storage fees of K7,200.00, the result of which was that the plaintiff owed them K18,228.17. By selling the vehicle they exercised their rights under the Unclaimed Goods Act as the plaintiff had failed to pay outstanding invoices and failed to take heed of notices given to him under the Unclaimed Goods Act.

THE ARGUMENT THAT NOTHING SHOULD BE AWARDED

4. It must be emphasised that this is a trial on assessment of damages following entry of default judgment. Though a judge assessing damages following entry of default judgment may revisit the question of liability, the discretion to do so must be exercised sparingly. The presumption arises on entry of default judgment that the judgment resolves all questions of liability on matters pleaded in the statement of claim. The judge assessing damages should make only a cursory inquiry to be satisfied that the facts and the cause of action are pleaded with sufficient clarity. If so, liability should be regarded as proven. Only if the facts or cause of action pleaded do not make sense or would make an assessment of damages a futile exercise should the judge inquire further and revisit the issue of liability (William Mel v Coleman Pakalia (2005) SC990, Banduwara Waranumbo v Hyper Construction Limited (2012) N4882).

5. Here the facts and cause of action are clear: there was a motor vehicle put in for repair, money was paid as part-payment, a contract was entered into, the defendants breached the contract and are liable in damages. The arguments now being raised by the defendants are defences which the defendants have lost the right to argue. There is no good reason to inquire further into the correctness of the judgment on liability. I will now assess each of the two categories of damages being claimed by the plaintiff.

VALUE OF TRUCK

6. The plaintiff has adduced sufficient evidence to prove that he purchased the truck for K15,000.00 and soon afterwards entered into the contract with the defendants for its repair. I award the amount claimed: K15,000.00.

REIMBURSEMENT OF MONEY PAID

7. The plaintiff has adduced sufficient evidence to prove that he paid the defendants K23,730.91 in instalments in the period from April 2005 to January 2006. All of this money was paid against invoices issued by the defendants for the repair of the truck. I award the amount claimed: K23,730.91.

SUMMARY OF DAMAGES ASSESSED

8. The assessment is:

(a) replacement value of the vehicle: K15,000.00; and

(b) reimbursement of money paid to the defendants: K23,730.91

being total damages of K38,730.91.

INTEREST

9. Interest will be awarded at the rate of 8 per cent per annum on the total amount of damages under Section 1(1) of the Judicial Proceedings (Interest on Debts and Damages) Act Chapter No 52. In view of the inordinate delay by the plaintiff in prosecuting the matter (the writ having been issued on 30 April 2007) I will fix the commencement date of the period in respect of which interest will accrue as the date of entry of default judgment, 7 January 2013. The end of that period will be the date of judgment. The total period is 319 days, which is 0.87 years. Interest is calculated by applying the formula D x I x N = A, where:

• D is the amount of damages assessed;
• I is the rate of interest per annum;
• N is the appropriate period in numbers of years;
• A is the amount of interest.
  

Thus K38,730.91 x 0.08 x 0.87 = K2,695.61.

COSTS

10. The general rule is that costs follow the event, ie the successful party has its costs paid for by the losing party on a party-to-party basis. The question of costs is a discretionary matter. There are no special circumstances in this case that warrant departure from the general rule. The plaintiff is the successful party and he will get his costs.

ORDER

(1) The defendants shall pay to the plaintiff damages of K38,730.91 plus interest of K2,695.61, being a total judgment sum of K41,426.52.

(2) Costs of the proceedings shall be paid by the defendants to the plaintiff on a party-party basis, to be taxed if not agreed.

Judgment accordingly.

_______________________________________________________
Thomas More Ilaisa Lawyers & Attorneys: Lawyers for the Plaintiff
Meten Lawyers: Lawyers for the Defendant