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United Enterprises Ltd v Allan [2018] PGNC 452; N7551 (21 September 2018)

N7551


PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]


OS (JR) No. 410 of 2015


BETWEEN:
UNITED ENTERPRISES LIMITED
Plaintiff


AND:
BENNY ALLAN, MINISTER FOR DEPARTMENT OF LANDS AND PHYSICAL PLANNING
First Defendant


AND:
ROMILLY KILA PAT, SECRETARY FOR DEPARTMENT OF LANDS AND PHYSICAL PLANNING
Second Defendant


AND:
BENJAMIN SAMSON, ACTING REGISTRAR OF TITLES
Third Defendant


AND:
AKU ENGINEERING LIMITED
Fourth Defendant


AND:
THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Fifth Defendant


AND:

ARROW TRADING LIMITED
Sixth Defendant


Waigani: Gavara-Nanu J.

2018: 20th June & 21st September


PRACTICE & PROCEDURE - Judicial Review - Claim for damages – National Court Rules; Order 16 r 7 – Requirements to be satisfied – Court’s power to order damages – Condition precedent – National Court Rules; Order 8 Divisions 1 and 2 – Pleadings.


PRACTICE & PROCEDURE – Judicial Review – National Court Rules; Order 16 r 7 (1) – Damages – Liability – Court’s power to enter default judgment – Damages to be assessed.


Cases Cited:
Papua New Guinea Cases


Koitachi Farms Limited v. Walter Schnaubelt (2007) SC870
Marie Iravela v. Benjamin Samson & Ors (2018) N7212
Papua Club Inc. v. Nusaum Holdings Ltd (No.2) (2004) N2603


Other Cases Cited:


Assets Company Ltd v. Mere Roihi and Others [1905] UKLawRpAC 11; [1905] AC 176


Counsel:


I. Shepherd, for the Plaintiff
S. Ketan, for the Sixth Defendant


21st September, 2018


  1. GAVARA-NANU J: Pursuant to an amended Notice of Motion filed under Oder 16 r 5 (1) of the National Court Rules (NCR), on 4 April, 2018, the plaintiff seeks review of the decisions of the third defendant to register instruments 1-13038 and 1-13346, respectively on 5 December, 2007 and 4 June, 2008 on State Lease Volume 15 Folio 121 and to register an unascertained instrument number on a date unknown on the above named State Lease, pursuant to which the property described as Allotment 12, Section 35 Kimbe, West New Britain Province (the property) was transferred from the fourth defendant to the sixth defendant.
  2. The plaintiff seeks orders in the nature of certiorari to quash the above decisions.
  3. The plaintiff also seeks orders that the sixth defendant, to within 14 days of the date of these orders, return the owner’s copy of the State Lease to the third defendant.
  4. Finally, the plaintiff seeks orders in the nature of mandamus to compel the third defendant to register the plaintiff as the registered proprietor of the State Lease pursuant to the Transfer Instrument dated 6 November, 2003. Further, that the third defendant amend his records to reflect these orders.
  5. The plaintiff in the alternative seeks damages against the first, second, third and fifth defendants for its loss of enjoyment of the property and for economic loss.
  6. The plaintiff seeks interest at commercial rate.
  7. This case has a long history. The following background facts are not in dispute. By an Order of the National Court, a company called Holman Corporation Limited was placed in liquidation in 2002. By a contract of sale dated 6 November, 2003, the plaintiff agreed to purchase the property from the liquidator, after the property was offered for sale on public tender. The Transfer Instrument was stamped and approved by the delegate of the first defendant on 6 February, 2004 and the settlement occurred on 14 April, 2004.
  8. On 24 May, 2004, the owner’s copy of the State Lease together with the stamped and approved Transfer Instrument, were lodged with the third defendant for registration of the transfer of the title to the plaintiff. These documents were never returned to the plaintiff’s lawyers and the plaintiff has never been registered as the proprietor of the property.
  9. In the interim, the officers of the Department of Lands and Physical Planning including the third defendant allowed the property to go through a number of sales. The details of those sales are as follows:

(ii) 14 April, 2008 transfer from Kina Real Estate & Auctioneers Limited to Nangha Enterprises Ltd;


(iii) 28 April 2008, transfer from Kina Real Estate & Auctioneers Limited to the Aku Engineering Limited (fourth defendant).


  1. Subsequently, Aku Engineering Limited sold the property to the sixth defendant. The Transfer of the title from Aku Engineering Limited to the sixth defendant was registered on 26 April, 2013. The sixth defendant at all material times was not aware of the plaintiff’s interests in the property and the fact that the property had previously been through several sales.

11. The defendants were all served with the relevant court documents including the Notice of Trial.


12. During Directions hearings, the State lawyers appeared in Court only a few times. The fourth defendant on the other hand did not appear at all in any of the Directions hearings. The lawyer for the State nonetheless certified the Review Book together with the lawyers for the plaintiff and the sixth defendant.


13. On 23 April, 2018, when the matter returned to Court for the last Directions hearing, counsel for the State, Mr. Yano was present in Court. On that day the matter was fixed for trial on 20 June, 2018.


14. The affidavit of service filed by the plaintiff’s lawyers, shows that the Notice of Trial (giving the trial date) was served on the State on 30 April, 2018.


15. However, on 20 June, 2018, the lawyer for the State did not attend the hearing, only counsel for the plaintiff and the sixth defendant attended. The Court having satisfied itself that the State and the fourth defendant had been made fully aware of the trial date, proceeded to hear the matter with only counsel for the plaintiff and the sixth defendant presenting arguments on behalf of their respective clients.


16. The sixth defendant has developed the property to the value of over K3 million.


17. The proceeding was issued on 10 July 2015, however the sixth defendant first became aware of it on or about 5 July, 2016, when it was served with court documents. The first to fifth defendants did not defend the case. They, especially the third defendant have not filed any affidavits in defence of the plaintiff’s claims, including explaining how and why the property went through a number of sales, including the sale to the sixth defendant, while the matter was with the third defendant for the title to be registered under plaintiff’s name.


18. The plaintiff has conceded that the sixth defendant purchased the property from the fourth defendant in good faith and that by the time it became aware of the plaintiff’s interests in the property, it had done substantial improvements to the property.


19. There is evidence that the plaintiff had written to the third defendant pointing out in detail certain anomalies resulting from the above mentioned sales and asked the third defendant to correct the anomalies. However, no action was taken by the third defendant to correct those anomalies. For example, invoking the process under ss. 160 and 161 of the Land Registration Act, Chapter 191, to recall and cancel the sixth defendant’s title.


20. There is no evidence of actual fraud under s. 33 of the Land Registration Act. See Papua Club Inc v. Nusaum Holdings Ltd (No.2) (2004) N2603; Marie Iravela v. Benjamin Samson & Ors (2018) N7212 and Koitachi Farms Limited v. Walter Schnaubelt (2007) SC870. See also Assets Company Ltd v. Mere Roihi and Others [1905] UKLawRpAC 11; [1905] AC 176.


21. As I understood the argument by Mr. Ian Shepherd of counsel for the plaintiff, notwithstanding the other relief sought, the plaintiff would be content with the alternative relief in damages which he argued arose from the failure of the third defendant to protect the plaintiff’s interests by allowing the property to be sold several times and failing to register the title under plaintiff’s name. This argument has not been denied or challenged by the first to fifth defendants. The argument has merit and I accept it. I find that the third defendant neglected his statutory duty to register the property under plaintiff’s name. The third defendant’s neglect of his statutory duty has not only rendered him liable to any damages suffered by the plaintiff but the first to third and the fifth defendants as well.


22. I am of the view that given that the property has gone through several sales, including the sale to the sixth defendant and that the sixth defendant was completely unaware of the plaintiff’s interest in the property, and that it has made substantial improvements to the property, the proper and appropriate remedy for the plaintiff is in damages.


23. The application must therefore be upheld but for the reasons given, I would not grant the relief sought in paragraphs 2 (a) to (e) but grant the alternative relief sought in paragraph 2 (f) of the Notice of Motion, which is damages.


24. The relevant legislative provision authorizing claim for damages in a judicial review proceeding is Order 16 rule 7. Pursuant to this provision, the plaintiff has pleaded damages as a relief in the Statement in Support and the Notice of Motion under Order 16 r 5 (1) of the NCR.


25. It is instructive to reproduce Order 16 r 7:


7. Claim for damages. (UK. 53/7)


(1) On an application for judicial review the Court may, subject to Sub-rule (2), award damages to the applicant if —


(a) he has included in the statement in support of his application for leave under Rule 3 a claim for damages arising from any matter to which the application relates; and


(b) the Court is satisfied that, if the claim had been made in an action begun by the applicant at the time of making his application, he could have been awarded damages.


(2) Order 8, Division 2, shall apply to a statement relating to a claim for damages as it applies to a pleading.


26. Under Sub-rule (1) the plaintiff must satisfy two requirements as conditions precedent for him to claim damages and to invoke the power of the Court to order damages. First, damages are sought as a relief in the Statement in Support, and such damages must arise from the matters to which the application relates. Second, had damages been claimed in an action began by the plaintiff at the time of making his application the plaintiff could have been awarded damages.


27. The Court’s power to order damages under Order 16 r 7 depends on the above two requirements being satisfied by the plaintiff.


28. The plaintiff should particularize his damages, especially special damages. If this is not done, the Court may order the plaintiff to give particulars. This is not a right, but it is necessary for proper determination or assessment of damages.


29. In this case, I find that the plaintiff has satisfied the two requirements under Order 16 r 7 (1) to claim damages.


30. Notably, Order 16 r 7 (2) provides that Order 8 Division 2, shall apply to a statement relating to a claim for damages as it applies to pleading. The terms of Order 8 Division 2 are as follows:


Division 2.—Particulars.


29. General. (16/1)


(1) A party pleading shall give the necessary particulars of any claim, defence or other matter pleaded by him.

(2) Rules 30 to 34 do not affect the generality of Sub-rule (1).


30. Fraud, etc. (16/2)


A party pleading shall give particulars of any fraud, misrepresentation, breach of trust, wilful default or undue influence on which he relies.


  1. Condition of mind.(16/3)
(1) A party pleading any condition of mind shall give particulars of the facts on which he relies.

(2) In Sub-rule (1) "condition of mind", includes any disorder or disability of mind, any malice and any fraudulent intention, but does not include knowledge.


32. Negligence: Breach of statutory duty. (16/4)


(1) In proceedings on a claim for damages in tort, a party pleading negligence (whether contributory or otherwise) or breach of statutory duty shall give particulars of the matter pleaded.

(2) The particulars required by Sub-rule (1) shall be a statement of the facts, but not of the evidence by which the facts are to be proved, on which the party relies as constituting the negligent act or omission or the breach of statutory duty alleged in the pleading.


(3) If the party relies on more than one negligent act or omission or breach of statutory duty, the particulars required by Sub-rule (1) shall, so far as practicable, state separately each negligent act or omission or breach of statutory duty on which he relies.


33. Particulars to be given in death or personal injuries cases.


(1) Where a claim is made by the plaintiff for damages for breach of duty, and the damages claimed consist of or include damages in respect of the death of any person or in respect of personal injuries to any person the statement of claim endorsed on the writ of summons shall set forth full particulars of the claim, including -


(a) the date and place of birth of each plaintiff; and

(b) a statement in summary form, of the material facts relied on as giving rise to the cause of action; and


(c) particulars of the injuries alleged to have been sustained by each plaintiff; and


(d) where relevant, a statement in summary form of the medical treatment received by each plaintiff; and

(e) where relevant, a statement as to whether or not with respect to each injured plaintiff that plaintiff has sustained any permanent disability and, if so, particulars of that disability; and


(f) particulars required by any Act under which a claim is brought; and


(g) details of each item of special damages claimed, including wages and other economic loss, both present and future; and


(h) particulars of the alleged negligence of the defendant, where negligence is alleged; and


(i) where relevant, the average weekly earnings (less income tax) of each plaintiff during the months previous to the injury and the period employed during those months; and


(j) where relevant, the average weekly amount which each plaintiff is earning or is able to earn in some suitable employment or business after the injury; and


(k) where relevant, the payment, allowance or benefit received from his employer by each plaintiff during the period of his incapacity; and

(l) where relevant, particulars of the persons dependent on the plaintiff's earnings, set out, as far as may be practicable, in that order.


(2) The claim shall conclude with a summary of the relief claimed, without quantifying either general damages or costs.

(3) In this rule, "personal injuries" includes any disease and any impairment of a person's physical, nervous or mental condition.

(4) The particulars of claim referred to in Sub-rule (1) shall, for all purposes of these Rules, be treated as a statement of claim.

(5) Rule 13(3), (4) and (5) shall apply, with appropriate modifications, to the particulars of claim referred to in Sub-rule (1).

34. Out of pocket expenses. (16/5)

Where, in proceedings on a common law claim, a party pleading claims damages which include moneys which he has paid or is liable to pay, he shall give particulars of those moneys.


35. Manner of giving particulars. (16/6)


(1) Where any of Rules 29 to 32 or Rule 34 require particulars of any pleadings to be given, the particulars shall be set out in the pleading or, if that is inconvenient, shall be set out in a separate document referred to in the pleading and that document shall be filed and served with the pleading.


(2) Notwithstanding Sub-rule (1), where the necessary particulars of debt, expenses or damages exceed three folios and have, before the date on which the pleading is filed, been given to the party on whom the pleading is required to be served, and the pleading shows the date on which the particulars were given —


(a) Sub-rule (1) shall not require that the particulars be filed

or served; but


(b) the Court may order that a copy of the particulars be filed and served.


36. Order for particulars. (16/7)


(1) The Court may, on terms, order a party to file and serve on any other party —


(a) particulars of any claim, defence or other matters stated in his pleading, or in any affidavit ordered to stand as his pleading; or


(b) a statement of the nature of the case on which he relies.

(2) Without limiting the generality of Sub-rule (1) where a party alleges as a fact that a person had knowledge or notice of some fact, matter or thing, the Court may, on terms, order that party to file and serve on any other party —


(a) where he alleges knowledge—particulars of the facts on which he relies; and


(b) where he alleges notice—particulars of the notice.


(3) The Court shall not make an order under this Rule before the filing of the defence unless, in the opinion of the Court, the order is necessary or desirable to enable the defendant to plead or for some other special reason.


31. The defendants may file a defence to damages claimed by the plaintiff. Such defence should be particularized, especially defence to special damages. This is also necessary for proper assessment of damages. The Court may therefore order particulars of defence, if the defendants do not provide them.


  1. The requirement to plead damages under Order 16 r 7 (1) (b) is a special procedure which in the clearest of cases should enable the Court to enter default judgment against the defendant. The Court should adopt this course where no defence is raised by the defendant and where no possible defence is disclosed by evidence.
  2. If the Court finds that liability is an issue, or where possible defence is disclosed by evidence then the proper thing for the plaintiff to do is to file a Statement of Claim for damages and prove the claims as in an ordinary civil proceeding.
  3. In this case, no defence has been raised either by the defendants or disclosed by the evidence which could have prevented the Court from finding the defendants liable for damages claimed by the plaintiff.
  4. Consequently the Court finds the defendants liable for the damages suffered by the plaintiff. Also given that no defence has been raised by the defendants against the claims by the plaintiff and no possible defence having been disclosed by evidence, I also order default judgment for the plaintiff with damages to be assessed.
  5. The plaintiff is ordered to file and serve a Statement of damages with particulars.
  6. The Orders of the Court are as follows:
    1. Default judgment for the plaintiff with damages to be assessed.
    2. The plaintiff is to file and serve its Statement of damages with particulars within 7 days from the date of these Orders, which is today.
    3. The first to third and fifth defendants may file their defence to damages claimed by the plaintiff with particulars for the purposes of assessment of damages.
    4. The first to third and fifth defendants will pay the costs of and incidental to this proceeding for the plaintiff and the sixth defendant, which are to be taxed, if not agreed.
    5. The matter will return to Court on 2 October, 2018 for Directions.

Orders accordingly.
__________________________________________________________
Ashurst Lawyers: Lawyers for the Plaintiff
Ketan Lawyers: Lawyers for the Sixth Defendant

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