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National Court of Papua New Guinea |
PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]
WS. NO.811 of 2014
BETWEEN
JAMES WAISIME AND MARYANNE WAISIME
Plaintiffs
AND
AUSKOA ENTERPRISES LTD
First Defendant
JUSTINE SEO trading as CITI ENGINEERING (PNG) LTD
Second Defendant
AND
PACIFIC TRADE INTERNATIONAL LTD
Third Defendant
Waigani: Kandakasi, J.
2016: 13 October
2019: 28 February
JUDGMENT & ORDERS – Default judgment – Effect of – Relevant
principles - Liability on matters pleaded determined in favour of plaintiff
Exceptions – Plaintiff still oblige to plead and prove damages.
DAMAGES – Assessment of damages for mesne profits for trespass and
occupation of property , conversion, pain, mental anguish and suffering and
special damages – Relevant principles – Damages allowable for proven injury
or loss – Need to avoid duplicating awards for same loss or suffering –
Measure of damages for each of alleged loss and suffering
Cases Cited:
Papua New Guinea Cases
Able Construction Ltd v W.R. Carpenter (PNG) Ltd (2014) N5636
Coecon Limited (Receiver/Manager Appointed) v. The National Fisheries Authority of Papua New Guinea (2002) N2182
Hodson v. The State [1985] PNGLR 303
Jeff Tole v. PNGBC (Unreported and Unnumbered Judgment of Justice Sevua of 14th March 2001).
Jack Pinda v. Sam Inguba (2012) SC1181
Madaha Resena v. The Independent State of Papua New Guinea (Re Fisherman’s Island) [1990] PNGLR 22
Nambawan Super Ltd v. Petra Management Ltd (2017) N6748
Peter Aigilo v. The Independent State of Papua New Guinea (2001) N2102
Peter Na-al v. Michael Debege N1958.
PNG Ports Corporation Ltd v Canopus No 71 Ltd (2010) N4288
PNGBC v. Jeff Tole (2002) SC694.
PNG Ports Corporation Ltd v. Charles Inni (2012) N4717
PNG Nambawan Trophy Ltd v. Tubuan Investments Ltd (2009) N5349
Rimbunan Hijau (PNG) Ltd v. Ina Enei (2017) SC1605
Rupundi Maku v. Steven Maliwolo (2011) SC1171
William Ekip Wii v. Gari Baki (2009) N5898
William Mel v. Coleman Pakalia (2005) SC790
Overseas Cases Cited:
Hall v. Westpac Banking Corporation (1987) 4 BPR 9578
Counsel:
D. Kipa, for the Plaintiffs
R. Obora, for the Defendants
28th February, 2019
1. KANDAKASI J: This is claim for mesne profits for trespass, conversion and occupation of the Plaintiffs’ property by the Defendants. It is also for general damages for pain, mental anguish and suffering and special damages. This arises out of a single entry and remaining on the property until the Defendants’ vacation of the property by eviction orders. Liability was resolved by default judgment after an inter partes hearing. Hence, the only matter remaining resolution is the Plaintiffs’ damages.
Parties Arguments
2. The Plaintiffs submit that the entry of default judgment established each of the causes of action or heads of damages pleaded. Accordingly, the Court must assess and allow damages for each of the heads of damages the Plaintiffs have pleaded. On the other hand, the Defendants’ submit that the Court must be guided by the proper principles governing assessment of damages and allow only damages that are legally allowable and established by appropriate evidence. Also, the Defendant’s submit against the Court allowing damages that amount to duplicate awards for the same loss. Based on their arguments, the Defendants’ submit that the claims for trespass, conversion and mesne profits are out of only one transaction. Hence only one award of damages for these heads of damages should suffice. Additionally, they submit that the Plaintiffs have failed to establish each of the heads of damages they are claiming. Hence, they must be dismissed with costs.
3. The Plaintiffs’ concede that their claims for conversion and loss suffered during period of the Defendants’ possession are covered by their claim for mesne profits and are forgoing these heads of damages. They are however, maintaining their claim for trespass and continued trespass and the other heads of damages as separate heads of damages not covered by their claim for mesne profits.
Relevant Issues
4. The issues for determination by this Court are thus:
(1) What are the proper principles governing an assessment of damages following entry of default judgment?
(2) Are the claims for mesne profits and trespass and continued trespass separate and different from each other?
(3) Subject to an answer to the question (2), what are the Plaintiffs’ actual damages?
Relevant Facts
5. The relevant facts as pleaded and confirmed by the default judgment as well as those presented in affidavit materials that have been filed are clear. The Plaintiffs successfully applied for State Lease over a property described as Allotment 48, Section 445, Hohola, NCD comprising of State Lease Volume 53, Folio 223, which was then a vacant land. That was in January 2009 following an advertisement for interested persons to apply for a State Lease. The purpose was to build a residential property. Notice of the Plaintiffs successful application came out in a National Gazette dated 26th January 2011. On 09th August 2012, the Plaintiffs through an agent paid all the fees required to be paid for the eventual issuance of title in their name. Notwithstanding those payments and almost all process completed, the official title did not get issued until 01st May 2013 when the Registrar of Titles issued the official State Lease title over the property. The State Lease period was for 99 years commencing on 26th January 2011 and ending on 25th January 2110.
6. During the period of delay in the issuance of the official title, the First Defendant secured a fraudulent title under the description Allotment 48, Section 445, Hohola, NCD, comprising of State Lease Volume 22, Folio 141. The First and Third Defendants appear to have entered into a contract of sale and purchase, following which the Second Defendant was invited onto the property by the Third Defendant sometime in the year 2012. The Second Defendant appears to be a builder engaged by the Third Defendant to build a four-storey building on the property. Accordingly, he was invited and allowed onto the property by the Third Defendant and authorize to store containers and building materials on the property. In order to bring the containers and building materials onto the property, the Second Defendant brought in and dumped strong soil, after which containers and building materials were brought onto the property.
7. The Plaintiffs were not aware of what the Defendants were up to until 30th April 2013, when one of the Plaintiffs, Maryanne Waisime travelled to Port Moresby to enquire about and see to an issuance of the official title to the property. After having flown into Port Moresby on 28th April 2013, she paid a visit to the property. That is when the Plaintiffs were shocked to find out all the activity on their land by the Defendants. Upon that discovery the Defendants were informed of the Plaintiffs’ legal title to the property. Despite that, the Defendants continued to occupy the property based on the fraudulent title. That caused the Plaintiffs to secure a letter from the Registrar dated 7th May 2013 declaring the nullity of the fraudulent title, a copy of which was delivered to the Second Defendant. Again, despite that letter, the Defendants continued to remain on the property. That caused the Plaintiffs to successfully take out eviction proceedings out of the District Court. The Defendants vacated the Plaintiffs’ property following the eviction orders.
8. The Plaintiffs subsequently instructed lawyers to issue this proceeding. Also, the Plaintiff’s took time out of their work and leave entitlements to attend to this matter. Appreciating the time and costs and other inconveniences this matter was causing them, and to avoid delays, increased costs, trouble and inconveniences to the parties, the Plaintiffs sought to have this matter resolved out of court. Unfortunately, the Defendants decided against settlement discussions. Instead they chose to go to Court and refuse to enter into any settlement discussions with the Plaintiffs.
9. The Defendants failed to take the appropriate defensive steps in accordance and within the time periods stipulated by the Court Rules and orders and directions of the Court. Consequently, the Plaintiffs applied for and the Court ordered judgement in default against the Defendants. Thereafter, the Court directed the parties to have the matter settled. This the parties were not able to do. Instead, they agreed to make submissions on the points in contention and allow the Court to come to a binding decision on the Plaintiffs damages. Submissions were thus received. Decision on the was reserved.
Issues (1) – What are the proper principles governing assessment of damages following entry of default judgment?
10. Despite the entry of judgment, the Defendants tried to raise issues on liability. It is thus important that I should remind myself of the relevant principles governing assessment of damages after the entry of default judgment. I summarised the relevant principles in Coecon Limited (Receiver/Manager Appointed) v. The National Fisheries Authority of Papua New Guinea (2002) N2182 in the following terms:
“A survey of the authorities on assessment of damages after entry of judgement on liability mainly in default of a defendant’s defence, clearly show the following:
11. These summations of the principles were adopted and applied in PNGBC v. Jeff Tole (2002) SC694. The decision of the Supreme Court in William Mel v Coleman Pakalia (2005) SC790, did the same. Additionally, however, the Court went further by noting several decisions of the National Court in which the principles were adopted and applied. It then added the following:
“Turning back to the issue raised above as to the role of the trial judge after entry of default judgment, we consider the following to be the correct approach:
the trial judge should make a cursory inquiry so as to be satisfied that the facts and the cause of action are pleaded with sufficient clarity;
if it is reasonably clear what the facts and cause of action are, liability should be regarded as proven;
only if the facts or the 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.”[1]
12. Allowing myself to be guided by these principles and the concessions the Plaintiffs have made, I find the Plaintiffs’ claim reasonably clear. Of the matters pleaded, there are only to two main heads of damages left to be dealt with. They are namely the claim for mesne profits and damages for trespass and continued trespass and the other related clams of diminution and restoration of the property and out of pocket expenses plus costs and interests. A question that must be answered before assessing the Plaintiff’s damages is the subject of the second issue, which I will turn to now.
Issue 2 - Are the claims for mesne profits and trespass and continued trespass separate and different from each other?
13. The concept of mesne profit has its origins in the feudal times and legal systems of England. Later, the concept became part of the English common law and the English legal system and eventually most of the former British colonies, which includes PNG. Mesne profits normally occurred where a landlord obtains a court order to evict a tenant or where an individual sues to eject a bona fide landlord to whom title was improperly conveyed. Mesne profits represented the value the ejected tenant received from the property between the time the court ordered eviction and the time when the tenant vacated the property. The mesne profits are derived from the land itself without the improvements on it. A good example of that is this. Mesne profits would accrue from crops planted on the land, but a factory built on the land or improvements to the land itself such as removal of unwanted and valueless stones from the land. This is because they add value to the land and become part of the land.
14. In PNG Ports Corporation Ltd v. Charles Inni (2012) N4717, David J correctly noted the principles governing damages for torts affecting land in the following terms citing from McGregor on Damages, Sweet & Maxwell Limited, 14th Edition, (1980), Chapter 32 at paragraph 1135:
“Where the defendant wrongfully deprives the plaintiff of his land, the plaintiff will generally wish to recover not the value of the land but the land itself. The principal action is therefore an action for the recovery of the land, historically better known as the action of ejectment. Damages will thus generally be limited to loss arising from the period of wrongful occupation by the defendant. Such damages are recoverable in the action for mesne profits, in origin an action of trespass...
15. Then has his Honour correctly noted, at paragraph 1136 of the same publication, the learned authors offered the following useful comments on how to measure damages of unlawful occupation of one’s property:
“The normal measure of damages is the market value of the property occupied or used for the period of wrongful occupation or use. There is little authority, but this measure is consonant with general principles and with the name of the action for wrongful occupation as one for mesne profits. If the rental value varies due to market fluctuations during the period of wrongful occupation, these fluctuations should be taken into account. If the defendant makes improvements on the land, the rental value should be assessed upon the unimproved...”
16. In the case before him, His Honour found;
“Since the termination of the lease agreement on 21 January 2011, the defendant continued to be in occupation of the demised premises without any legal basis. The plaintiff was wrongfully dispossessed of the demised premises therefore has a right of action against the defendant for mesne profits: see for instance, Seafreight Pty Ltd v Bishop Shipping Services Pty Ltd [1976] PNGLR 22. The right to mesne profit accrues from the date of determination of the lease agreement and in the present case it will be calculated from 21 January 2011 to the date vacant possession is given to the plaintiff. Assessment of mesne profits will be calculated at the rate of K110.00 per month as from 21 January 2011 until date of vacant possession.”
17. Proceeding along the same lines, Hartshorn J., in PNG Nambawan Trophy Ltd v. Tubuan Investments Ltd (2009) N5349, assessed damages on the following basis:
“21. The amount claimed for mesne profits between August 1999 to 30th April 2009 is K697,786.83 being 117 months x K 5,963.99. As previously stated, the sum of K5,963.99 includes an instalment of purchase price as well as a monthly occupation fee. However, the total amount of the unpaid occupation fee from August 1999 up to 30th April 2009 is calculated at K 209,819.61. Given that the occupation fee was the amount agreed, that is the amount upon which mesne profits will be calculated. I allow a claim for K209,819.61.”
18. Later in Rimbunan Hijau (PNG) Ltd v. Ina Enei (2017) SC1605, the Supreme Court of which I was a part, had a case of the appellant entering the respondents land without its approval. The appellant chose to deal with another person who claimed he was the owner, which gave rise to an ownership challenge in the Local and Provincial land courts. Eventually, the ownership issue was resolved in the respondent’s favour. The respondent sued for trespass and mesne profits.
19. In that context, the Supreme Court noted the correct principles governing assessment of damages in the following terms:
“35. We agree that, the principle generally is to restore a plaintiff though not exactly to the same position but, as best as money can, to the position he or she would have been had it not been for a defendant’s tortious action. Assessing damages is not matter of mathematical or scientific precision. It however, requires a careful consideration and weighing of all evidence presented before the Court and Court arrives at an award it considers will best compensate a plaintiff who suffers loss or damage on account of a defendant’s tortious actions.”
20. The Court then noted there are number of cases on the assessment of damages for trespass in our country. Of them all, the Supreme Court referred to the decision of Bredmeyer J., in the case of Madaha Resena v. The Independent State of Papua New Guinea (Re Fisherman’s Island) [1990] PNGLR 22. There, His Honour quoted the following passage from McGregor on Damages, 15th ed. (1988), Ch. 32 at paragraph 1421 and applied it to the case before him:
“Nevertheless, on the strength of these decisions as establishing the principle, it was held in Whitwham v. Westminster Brymbo Coal Co. [1896] 2 Ch. 538 at 542, where the defendant had trespassed on the plaintiff’s land by tipping soil from his colliery upon it, that the principle of the wayleave cases applied so that the damages were not to be assessed merely by taking the diminution of the value of the land but the higher value of the user to which the defendant had put it. Lindley L.J. said the law was settled by Jegon v. Vivian, (1871) [1871] UKLawRpCh 21; L.R. 6 Ch. App. 742. He put the matter thus: “The plaintiffs have been injured in two respects. First, they have had the value of their land diminished; secondly, they have lost the use of their land, and the defendants have had it for their own benefit. It is unjust to leave out of sight the use which the defendants have made of this land for their own purposes, and that lies at the bottom of what are called the wayleave cases”. In the result, it was held that as to so much of the plaintiff’s land as was covered by the soil tipped thereon by the defendant, the value of the land by using it for tipping purposes was the correct measure, this value being much greater than the diminution in the land’s value since it was the only land procurable for tipping purposes. And in more modern times the courts have applied Whitwham v. Westminster Brymbo Coal Co. to reach a similar result. In Penarth Dock Engineering Co. v. Pounds [1963] 1 Lloyd’s Rep. 359, the defendant, having bought a pontoon or floating dock from the plaintiffs failed to have it removed within a reasonable time from the dock premises of which the plaintiffs were lessees and which were in the course of being closed down by their lessors. In the plaintiffs’ action, which was framed as trespass or breach of contract, Lord Denning M. R. assessed the damages at the benefit obtained by the defendant by having the use of the dock premises after he should have removed the pontoon, although the plaintiffs had lost nothing since the dock premises were of no use to them and their lessors had not required them to pay extra rent”.
21. The Supreme Court in Rimbunan Hijau (PNG) Ltd v. Ina Enei (supra) observed:
“As can be seen from this passage, in Whitwham v Westminister Brymbo Coal Co (supra), the Court assessed damages measured by
the benefit derived from the defendant’s use of the claimant’s land for tipping soil. Similarly, in Penarth Dock Engineering
Co. Ltd v. Pounds,..the Court assessed damages measured according to the benefit the defendant had obtained in using a berth on the
plaintiff’s dock without permission. These two cases have been widely cited in many other English and Australian cases and
texts books....”
22. In the case before the Supreme Court, the learned trial judge adopted these principles with some emphasis. The trial judge had
gone on to say these principles supported his view that “damages for the plaintiff should be decided on the basis of the total
benefits the defendant derived from using the land.” Then applying these principles, His Honour found the appellant injured
the respondent in two respects. The first was physical damage done to his land which resulted in its value being diminished. The
second was in a deprivation of the respondent from using and benefiting from his land while the appellant occupied and beneficially
used the land illegally. The learned trial Judge found that, the appellant had brought upon the land through an access road round
logs in large volumes, stored them, used big machinery like loaders and a giant crane to move and load logs onto pontoons, barges
and tugboats berthed not far offshore which were used to carry logs to ships. The evidence was in the form of newspaper cuttings
annexed to an affidavit for the respondent admitted into evidence without any challenge from the appellant.
23. The Supreme Court made three observations on this findings and decision of the learned trial Judge. Firstly, the Court noted that:
“...land use varies from country to country and more so from economy to economy. A landlord who is deprived of his property in a developed economy or in the cities and towns could easily be measured and remedied in monetary terms. City and town land could easily be used for a variety of purposes if the original state cannot be restored or if the land has been completely lost, the land could be replaced by the purchase of an alternative land from damages awarded. However, a landowner in a rural setting as is the case for most of the people of PNG, the harm and loss done to a landowner may be immeasurable and irreparable.
24. The Court reason that:
“...it is from the land itself in their natural setting in most cases, provide survival supplies to the people, for food, accommodation and other basic needs that sustain them. Such land support hunting, gathering and even gardening. When the original state of the land is changed with its natural habitat and vegetation and other natural properties lost, it becomes totally useless for a rural dweller. Depending on the size of the land and the nature and extend of the damage done, the landowner will no longer be able to hunt, gather, garden or otherwise use his land in the same way before. These cannot be re-established easily within a short space of time or at less costs and in any case if possible, not back to its original position. This is why we say damages for such land is immeasurable and might be continuous for many generations to come for the landowners.”
25. It then concluded:
“Given these, the way damages are calculated in the developed economies and or in cities and towns, cannot be used to assess damages done to a land situated in a rural setting.”
26. The second observation the Supreme Court made was the application of the principle that, no one can be allowed to gain from his or her own criminal conduct. The Court noted that:
“...none of the English cases as followed and applied in PNG and elsewhere appear to discuss and take into account the principle that a person cannot be allowed to gain from his or her illegal or criminal conduct.”
27. Further, the Court noted that several Supreme and National Court decisions in PNG have spoken of and or applied this principle in the context of other settings but not on its own with separate and specific consequence flowing therefrom. The Court referred to its decision in PNG Deep Sea Fishing Ltd v. Luke Critten (2010) SC1126 as an example of a case on point. It then said:
“...Trespass is clearly an illegal activity, which is both a criminal and a civil wrong in nature which can result in criminal prosecution and a civil claim for damages. Following the English common law or case law approach as adopted and applied in PNG already, effectively allows a trespasser to gain from his or her own criminal or unlawful conduct and get away with it save only for the small amount of damages as assessed in the past cases.
28. Then most importantly, the Supreme Court observed and concluded:
“We are of the view therefore that, any assessment of damages must have a clear reflection of the extent of a trespasser’s gain out of his or her illegal entry and use of another’s land, and not the rate that applies to rental of city and town land areas or indeed any such rate in terms of price per square meters. Both fairness and equity demand that the damages that ultimately get assessed against a trespasser should indeed reflect the gains the trespasser has made out of his or her illegally using another’s land as in this case, which may far exceed the price per square meter.”
29. Thirdly, the Supreme Court observed:
“a landowner would be hard placed to access any evidence on the specifics and more so the full nature and extent of a trespassers gain or benefits from the use of the land. Naturally, a trespasser would be in possession of such information.”
30. Accordingly, the Court held:
“The onus should be on the trespasser ... to fully disclose all [the] relevant information or evidence. Such disclosure should be made upon the landowner making a claim against a trespasser to enable an expedited settlement through direct negotiations, mediations or a form of ADR and only failing that, resolution by trial. Any failure to disclose or produce the kind of evidence in question, should result in any secondary or tertiary evidence being allowed to overcome the lack of any direct evidence, as a practical application of the best evidence rule principle.
31. The Court then went on to note that, the emphasis worldwide now is on the need for the parties to settle their disputes and reserve the Courts for cases in which there is a question warranting resolution only by judicial determination. It then referred to my decision in the matter of Able Construction Ltd v. W.R. Carpenter (PNG) Ltd (2014) N5636. There at paragraph 18, I listed the kind of questions or issues that are inappropriate for resolution by mediation or before that, the parties’ own direct settlement negotiations.
32. The past cases, such as those noted by the Supreme Court in Rimbunan Hijau v. Ina Enei (supra) case, assessed damages based on the use or benefit derived from the use of the relevant land by a trespasser, which have essentially been for mesne profits. Later cases like the decision in William Ekip Wii v. Gari Baki (2009) N5898, do not offer any assistance on the separateness of trespass itself to mesne profits. They all revert to actual damages to the property and beneficial use by defendants or trespassers. However, these authorities make assessment of damages for mesne profits easier as we have some case precedent to go by. On the other hand, there is almost a complete lack of case authorities recognizing the separateness of a claim for damages for trespass and a claim for damages for mesne profits.
33. A case that might be of assistance is Canning J.’s decision in Nambawan Super Ltd v. Petra Management Ltd (2017) N6748. There, the plaintiff secured summary judgment against the defendants for the tort of trespass to land, expressed in the following terms: “judgment is entered for the plaintiff for trespass and for the costs of restoring the land which has been dug up by the first defendant”. At the trial on assessment of damages and costs of land restoration, the plaintiff claimed K20,000.00 damages and K153,120.00 for costs of land restoration. The defendants submitted that, nothing should be awarded as the value of the land had in fact, increased since they entered it and there was insufficient evidence that the land had been dug up. Consequently, the defendants argued that the plaintiff had failed to prove any losses. The Court rejected the defendants’ arguments and awarded K20,000.00 for trespass without demonstrating how the Court arrived at that figure. Also, the Court awarded K153,120.00 for costs of restoration of the land, which was supported by evidence adduced for the plaintiff. The evidence amongst others established that the purpose for which the defendants dug up the land and the Plaintiff’s intended use of the land were different, and restoration was necessary.
34. Having regard to the foregoing discussions and the case authorities cited, I consider a claim in trespass is different from a claim for mesne profits. Trespass goes into the question of how a defendant to such a claim first entered the plaintiff’s land or property. If the defendant first entered the land without any permission authority or consent of its owner, that amounts to an act of trespass. It is both a criminal and civil wrong. The former would attract criminal responsibilities and penalties, while the civil wrong would attract damages. Depending on what the owner wants and the actions or inactions of the police both types of consequences could follow against a trespasser. Hence, action under either of the process, criminal or civil, would not excuse actions under the other. On the other hand, mesne profits cover the period a defendant occupies another’s land and gains from it, whether any actual income or benefit is derived or not by reason only of the defendant’s adverse possession of the land. The measure of damages is based on the extent of the defendant’s use of the land and gaining from it. Hence, trespass and mesne profits are two separate causes of action which could attract separate assessments and award of damages if made out. One could argue as does the defendants here that, they arise out of the one transaction and only one award of damages should cover both. But such an argument ignores the fact that trespass without any use and gain from the property is compensable without the need to prove use and gain. Similarly, mesne profits could come about without trespass. This could be possible where the defendant lawful enters the property say under a lease or rental agreement but fails to vacate after the expiry of its relevant term and the defendant continues to make use and gain from the property.
35. The view I have expressed is in my view fortified by the fact that, the Constitution at the highest by section 53 recognizes and makes provisions for the protection of land owners from being unjustly deprived of their properties. I consider it important to separate the two different kinds of tort. Except for what is specifically authorized by this provision, no one is authorized to deprive another person of his or her property. The only person authorized to take over another’s property is the State through a compulsory acquisition process for public purposes. The Lands Act 1996 by sections 7 (b), 12, 13, 15 and 16 provide as to how the State could compulsorily acquire land. Both sections 53 (2) of the Constitution and s. 14 of the Lands Act 1996 grants owners of land compulsorily acquired, a right to compensation.
36. For these reasons, I reject the defendants’ arguments and uphold that of the plaintiffs that, a claim for damages for trespass is different and separate to a claim for damages for mesne profits. Accordingly, damages must be separately assessed and awarded for each of them, whist exercising care not to compensate the plaintiff for the same harm or injury twice. Having establish that mesne profits and trespass are two separate causes of action, I will now deal with the final question of, the plaintiffs’ damages. That is the subject of the remaining question or issue for this Court to deal with.
Issue 3 - What are the Plaintiffs’ damages”
38. After allowing for the concessions the Plaintiffs have made, the headings of damages they are still claiming are:
(1) mesne profits;
(2) trespass and continuing trespass;
(3) diminution of market value of property;
(4) Costs of restoration;
(5) Mental anguish, frustration and emotional distress;
(6) Out of pocket expenses in airfares, accommodation and related;
(1) Mesne Profits
39. We will deal with mesne profits first. As already noted, the correct way to assess damages for mesne profits is “the market value of the property occupied or used for the period of wrongful occupation or use.” This usually comes to the commercial rental value of the property if it was indeed or were to be rented at the relevant time. That allows for any variation in the rental value from time to time in order that the applicable rental rate is use to assess the damages. If the defendant occupier made improvements to the land, mesne profit is assessable based on the unimproved value of the land. Where as in the case of PNG Nambawan Trophy Ltd v. Tubuan Investments Ltd (supra) the parties agree on the relevant occupational fee or rental rate, that will be the rate to use.
40. Here there is no agreement to go by. That means we will have to ascertain the commercial rental market value of the property and assess the damages for mesne profits. The Plaintiffs have secured the assistance of one of the leading real estate companies in the country, Century 21 Real Estate Ltd. Century 21 has given a figure of K150.00 per square meter per annum. There is no serious dispute or contest on this rate. I will thus use that figure, and have it multiplied by the total land area which is given as 402 square metres, again a figure that is not the subject of any serious contest. I will then have these multiplied by the total period the Defendants occupied the land until they fully vacated it.
41. The Defendants argue for the relevant period to commence from the date when the Registrar of Titles issued the official title in favour of the Plaintiffs on 1st May 2013 up until the date of the Defendants’ vacation on 05th February 2014. On the other hand, the Plaintiffs submit the relevant commencement date should be 20th December 2012, when the Defendants’ first entered the property. In my view, upon publication of the notice in the National Gazette dated 26th January 2011 of the Plaintiff’s successful application for State Lease over the property, everyone was placed on notice that the Plaintiffs were the only persons who had the legal interest over the property. Hence, all persons including the Defendants were all on notice that the only person that had a legal interest over the property were the Plaintiffs, until that interest and right was properly extinguished. I therefore find that, the Defendants had knowledge or had reason to know that the Plaintiffs were the legal interest holders of the property. The subsequent issuance of the formal title was a confirmation of that interest and right over the property the Plaintiffs had as at the time of advertisement of their successful tender for the property. Accordingly, for the purposes of calculating the mesne profits, I will allow the period to commence from 20th December 2012, when the Defendants first entered the property and the uncontested date of vacation being 05th February 2014. These produces a total of 13 months and 16 days.
42. In the Plaintiffs submissions, which is somewhat confusing, they suggest their mesne profits be assessed in terms of “13 months x K150 x 12 months x 402 square meters = 13 months x K60,300 per annum. (K60,300 /12 months = K5,025.00 per month. Mesne Profits Total = K60,300.00 + K5,025.00 (for 13 months) = K65,325.00.”
43. I consider an easier way to calculate the mesne profits is to multiply the K150 per square meter rate by 402 being the total square meters to arrive at the annual rental rate which comes to K60,300.00. Then since we have 13 months and 16 days, we should get a daily rate by dividing the annual rental by 365 days in a year to arrive at the daily rate. Applying that formula produces, a daily rate of K165.21 (rounded up). If we then multiply that by the total number of days which comes to around 419 days the total annual rental comes to K69,222.99 for the 13 months and 16 days occupation by the Defendants. Consequently, I assess and allow the Plaintiffs mesne profit damages at K69,222.99.
(2) Trespass and continuing trespass
44. Turning to damages for trespass and continuing trespass, I discussed the basis for treating trespass separately from mesne profits already. I will not repeat them here. The points I have earlier made, brings out clearly the point that trespass is both a criminal and civil wrong. This is compensable with a reasonable amount allowable for this kind of tort depending on the seriousness of the trespass. If the trespass is a single act after which the tortfeasor vacates without putting the land owner to the trouble of taking steps such as those taken by the Plaintiffs’ in this case, damages could be less. But if the opposite is the case, the damages could be greater. In this case, if the Defendants did not know despite the gazettal in the National Gazette of the Plaintiffs interest and rights over the property, they were informed by 30th April 2013 of the correct legal position. They refused to vacate and chose by their conduct to put the Plaintiffs through the trouble of getting them evicted through a court order in 2014.
45. The Plaintiffs’ submissions refer to their pleadings in paragraph 13 of the statement of claim and say that those pleadings plead “the particulars of Loss and Damages suffered as a result of the continued trespass by the Defendants of their property. The Plaintiffs obviously suffered the exclusive use and enjoyment of the property.” Paragraph 13 of the statement of claim only gives broad headings to alleged losses and damages. The pleadings read in the following terms:
“Particulars of Loss
(a) Loss of exclusive peaceful occupation, use and enjoyment of the property;
(b) Loss of economic value of the land;
(c) Loss of time and delay in the construction of their residential home;
(d) Loss of income benefits accruing from the property;
(e) Financial losses incurred in repossessing the property;
Particulars of Damages
(a) The damping of waste land and materials on the property;
(b) The entire change of landscape;
(c) Soil erosion caused by the wasteland dumped on the property.”
45. In my view, these are hardly of any help. They are not proper pleadings to assist with any assessment of damages for the Plaintiffs under trespass. The submissions do not assist at all because they only refer to the pleadings which are unhelpful. The Plaintiffs have a duty and an obligation to properly plead with sufficient particulars and adduce the evidence required to succeed. Several cases have been dismissed for poor pleadings and or for a failure to adduce the required kinds of evidence. On the other hand, damages have been assessed in some case and allowed on skeleton pleadings in order to do justice. I am prepared to take the latter approach and do what I can base on the poor pleadings and lack of proper and helpful submissions from the Plaintiffs’ lawyers to allow for damages reasonably flowing from the Defendants trespass and not covered by the already assess and allowed damages for mesne profits.
46. Until 30th April 2013, the Plaintiffs did not visit the property and hence were in no position to take occupation of the property anytime before then. Most of their efforts were concentrated on securing their legal title to their property. There is neither any pleading, nor is there any evidence as to when the Plaintiffs were going to take physical possession of the property. Also, there is no evidence of when exactly were they going to give effect to their claim of building a family home? If that claim is real, what are the specifics of the house they were going to build with the corresponding level of funding required? Where was the finance required going to come from, how ready were they and when were they going to move onto the land and build their family house? What financial expenses or losses did the Plaintiffs’ suffer? There is a complete lack of pleading and evidence providing the kind of information these questions are begging.
47. However, notwithstanding this lack of pleadings and lack of assistance coming from the Plaintiffs lawyers’ submission and evidence, I have already decided to award damages for mesne profits. Hence, I have already covered item (1) mesne profits. That award in my view covers fully the claims for losses under (a) and (d), namely the alleged losses of exclusive peaceful occupation, use and enjoyment of the property and loss of income benefits accruing from the property. I will dismiss the claim for loss of time and delay in the construction of their residential home under (c) as not being made out. This leaves us to deal with the alleged losses under (b) and (e).
48. Item (b) comes under diminution of market value of property and costs of restoration. Accordingly, I will deal with that alleged loss under these heads of damages. The only item for us to consider under trespass then is (e), which concerns the financial losses incurred in repossessing the property. Although the Plaintiffs lawyer’s submission fails to clearly make out a case under this item, Maryanne Waisime’s affidavit sworn on 17th and filed on 23rd February 2015, clearly speaks of the expenses and losses she and her husband were forced to incur by reason of the steps they took to evict the Defendants and secure vacant possession of their land. Included under this heading are airline tickets of AUD$2,485.59, legal costs of K1,000.00 and loss of accrued leave entitlements valued at AUD$18,215.97. I am prepared to allow these expenses as necessarily forced upon the Plaintiffs by the Defendants trespass and the steps the Plaintiffs had to take to have them evicted.
49. In addition to the specific loss and expenses allowed in the foregoing, am prepared to allow damages for the act of trespass itself for the reasons I have earlier given. In Nambawan Super Ltd v. Petra Management Ltd, the Court awarded K20,000.00 for the act of trespass alone. There is not much information about the act of trespass in that case, apart from the fact of the trespass itself. Taking that as a guide and having regard to the particular circumstances of this case, I consider an award of K50,000.00 is reasonable, to compensate for the act of trespass, the Defendants’ failure to acknowledge the fact that the Plaintiffs were the legal owners of the property upon being informed by the Plaintiffs, their failure to reason with the Plaintiffs and allow for an expedited vacation of the property without putting the Plaintiffs to the pain and trouble of getting them evicted by the force of a court order.
(3) and (4) - Diminution of market value of property and costs of restoration
50. I now turn to the allegation of loss of economic value of the land, with the pleaded particulars of dumping of waste land and materials on the property, change of entire landscape and soil erosion caused by the wasteland dumped on the property. These fall under the claims for damages for diminution of market value of the property and costs of its restoration.
51. In his submission for the Plaintiffs’, counsel for the Plaintiffs has separated diminution of the market value of the land and costs of restoration. I do not with respect, consider that is right. They are closely connected. The allegation is that the dumping of waste land material on the property has diminished the value of the land. If the land was left with the wasteland and material still on the land, there would be compensation up to the value of the diminution of the market value from its market value. But if there to be removed that will restore the value of the land. Without any proper pleading, and evidence demonstrating the value of the land as it was prior to the Defendants trespassing and extend of harm or loss done to the property, the Plaintiffs argue for an award of K50,000.00.
52. If the claim was only for diminution of the market value of the land, and there was foundation in the pleadings with evidence supporting, I could accept the submission and make such an award. However, the fact of the matter is there is no proper foundation in the pleadings. There is also no evidence of the pre-trespass and dumping of the land and its value before and after these events. Additionally, there is a claim for costs of restoration. Again, the pleadings do not provide any better foundation for this part of the claim. Nevertheless, the evidence adduced by the Plaintiffs without any objection from the Defendants makes it clear that, it will cost K86, 692.80 to have the property restored through a digging up and removal of the wasteland and materials that were dumped on the land. I find this represents the value of the damage done to the land by the dumping and that can be restored at the stated costs. Accordingly, I assess damages for diminution and costs of restoration of the property at K86,692.80.
53. This takes us to the Plaintiffs’ claim for mental anguish, frustration and emotional distress.
(5) - Mental anguish, frustration and emotional distress
54. Counsel for the Plaintiff submits that, it is “trite law that damages is awarded under this heading”. However, counsel has not assisted the court with any case law or any other authority supporting that proposition and how his clients are entitled, as a matter of law to damages under this heading. In Peter Aigilo v. The Independent State of Papua New Guinea (2001) N2102, I noted that claims for damages for distress, frustration and hardship is a recognised head of damages in our jurisdiction since Hodson v. The State [1985] PNGLR 303. From a survey of the case law, award of damages for this head of damages range from K2, 000.00 to K15, 000.00. As at the time of my decision in the Peter Aigilo case, the highest award for this head of damages at that time was the decision in Peter Na-al v. Michael Debege N1958. In other cases, like that of Jeff Tole v. PNGBC (Unreported and Unnumbered Judgment of Justice Sevua of 14th March 2001) the Court awarded K12, 000.00.
55. The awards were made in the past cases having regard to the extent of the damage in each of the cases. Then in the case before me, I considered the fact that, the plaintiff was then the Police Commissioner, which is an important Constitutional office. The Police Force has a system of farewelling outgoing and welcoming incoming Commissioners. That is in addition to giving of proper and sufficient notice and providing reasons for termination if terminated earlier then agreed or expected expiry dates. All of these culminates in a guard of honour. The plaintiff was not accorded a guard of honour and respect. He was not given any notice of the first defendant's intention to terminate him. He was not even provided with the reasons for his termination. He was terminated in the most disgraceful and humiliating manner. He learned of his termination when he turned up for work at the relevant time and found out that he was replaced by a new Commissioner and a guard of honour was being mounted to welcome the new Commissioner, without first farewelling the plaintiff. This happened within a space of 6 days only after the Plaintiff was congratulated for a job well done by then Prime Minister, Sir Mekere and other Ministers. The Plaintiff was no doubt shocked. But for his strong health he, he could have had a heart attack there and then. The available medical evidence diagnosed the Plaintiff as suffering a medical condition described as ‘acute severed nephorotic syndrome’ contributed to by the loss of job, loss of status, loss of money and the way in which he was terminated.
56. Further, based on his contract, the Plaintiff entered into a loan and other financial commitments. The bank called up the loan and his children’s school fees were seriously affected. He tried to make ends meet by seeking alternative employment with little or no luck. Although he secured some temporary employment, they did not last and did not replace the sudden loss he was made to face. This greatly impacted against his health and rendered him bed ridden. He was rendered as good as useless because of the way in which the defendants have treated him.
57. I considered the distress, humiliation and frustration the plaintiff was forced into by the defendants had impacted upon the plaintiff's health adversely. I considered that comparatively was worse than those suffered by the plaintiff's in the earlier cases. Accordingly, I found a claim of K20,000.00 neither unreasonable nor inordinately high. Hence, I accepted that submission and awarded that amount in damages for distress, humiliation and frustration.
58. In the present case, the Plaintiffs’ submission refers to paragraph 17 of their statement of claim. However, the pleadings in that paragraph with respect, do not specifically plead with any particulars any mental anguish, frustration or distress the Plaintiffs suffered. There is neither any evidence no any pleading of any adverse medical condition suffered by either of the Plaintiffs. In their submissions, there is reference to one of the Plaintiffs’ child having suffered serious illness. That coupled with the Defendants trespass and continued occupation caused much stress to the Plaintiffs so submits, the Plaintiffs’ counsel. I will, however, ignore this part of the submissions because it is not in the pleadings.
59. The only matters pleaded are the fact of discovering the Defendants trespassing and illegal occupation of the property, the Defendants failure to vacate when requested or required by the Plaintiffs, and the pain and trouble of taking the various steps they had to take to have the Defendants evicted. The award under mesne profits covers the illegal occupation. The unlawful entry onto the property and continuously occupation of it is covered by the award under trespass. The actual costs incurred by the Plaintiffs to recover possession are claimed under out of pocket expenses which I have already allowed under the heading of trespass. The only aspect not covered in any of the awards already made and those remaining is the mental and emotion anguish pain and suffering the Plaintiffs were put through by the Defendants illegal entry and continuing to remain on the property even after the Plaintiffs came forth and asserted their rights. Once, the Plaintiffs claimed their rights over the property, the Defendants should have cooperated and vacated the property, but they did not. Instead, they chose to remain on the property and failed to enter into any meaningful settlement discussions and resolve the matter. Further, the Defendants conducted themselves in a manner someone with a superior right or interest would. Consequently, I accept that these conduct and behaviour of the Defendants put the Plaintiffs through some form of unnecessary, stress, pain and trouble. I will thus, allow for some damages for this even though the Plaintiffs lawyer failed to make a proper case in his submissions and before that in his pleadings for his client.
60. The counsel for the Plaintiffs’ in his submission for the Plaintiffs is asking for an award of K30,000.00. Unfortunately, there is no assistance provided in those submissions as to how that figure has been arrived at and what case precedent they have used. Doing the best in the circumstances, whilst duly considering the other awards I have already decided to make, and the past awards, for this head of damages, I consider an award of K10,000. 00 reasonable and sufficient. Accordingly, I ward K10,000.00 for mental anguish, frustration and emotional distress.
(6) Out of pocket expenses in airfares, accommodation and related
61. The final heads of damages I turn to is, out of pocket expenses in airfares, accommodation and related. At paragraph 18 of their statement of claim, the Plaintiffs claim:
(a) K1,950.00 for accommodation costs from 28th April to 10th May 2013;
(b) K3,250.00 for hire care for 13 days at K250 per day;
K1,300.00 for meals for 13 days;
(d) K3,000.00 for District Court expenses.
Total = K9,500.00
62. In his submission for the Plaintiffs, their counsel submits that since these items were pleaded in these way and default judgment has been entered against the Defendants, there should be judgment for the Plaintiffs in those amounts. This submission with respect is inconsistent with the law on assessment of damages following default judgment as I discussed and restarted in the earlier parts of this judgment. As a matter of law, only liability under each of the items of lost has been establish. However, the question of what exactly are the damages is a matter of prove by appropriate evidence. The relevant question then is, what evidence has the Plaintiffs adduced to establish this part of the claim.
63. The only evidence on point is from Maryanne Waisime’s affidavit sworn on 17th and filed on 23rd February 2015. As I already noted under the assessment of damages for trespass, this affidavit clearly speaks of the expenses and losses she and her husband were forced to incur by reason of the steps they took to evict the Defendants and secure vacant possession of the land. Included under this heading were airline tickets, (AUD$2,485.59), legal costs K1,000.00) and loss of accrued leave entitlements valued at AUD$18,215.97. Based on that evidence, I decided to allow these expenses as forced upon the Plaintiffs by the Defendants trespass and the steps the Plaintiffs had to take to have them evicted. The effect of that then on the current head of damages is that these out of pocket expenses have already been considered and allowed for in the award under trespass as expenses forced upon the Plaintiffs.
64. Further, the Plaintiffs submission through their lawyer argues of a further award of damages for out of pocket expenses not included in the pleadings. These expenses are for expenses incurred well past the filing of the Statement of Claim. The Plaintiffs make no submission as to whether the pleadings were amended to include this expenditure items. In the circumstances, I decline to make any additional awards for out of pocket expenses. This is necessary to avoid duplication of awards and to avoid venturing out of the specific pleadings.
66. In summary I make the following awards:
(1) K69,222.99 in mesne profits;
(2) K50,000.00 for trespass with the additional awards for the following expenses:
(a) AUD$2,485.59 for airfares;
(b) K1,000.00 in legal costs;
(c) AUD$18,215.97 value of accrued leave entitlements lost;
(3) K86,692.80 for diminution of value and costs of restoration of property;
(5) K10,000.00 for mental anguish, frustration and emotional distress
67. The damages in Australian Dollars will convert into PNG Kina using the current and prevailing exchange rate. Thus, the AUD$2, 485.59 converts to K6, 663.04 @ the rate of 1 PGK = .4100 AUD, while the AUD$18,215.97 converts to K44,433.80, using the same rate. Adding all these figures up, the grant total comes to K 268,012.63. Accordingly, I order judgment for the Plaintiffs against all of the Defendants jointly and severally in the sum of K268,012.63.
Costs
68. I further order costs in favour of the Plaintiffs on a solicitor and own client basis to be agreed if not taxed against each of the Defendants both jointly and severally. The reason for this is simple. Firstly, the Defendants failed to enter into meaningful settlement negotiations and have this matter settled when the Plaintiffs made that intention clear and approached them. An order similar to such an order was made in the case of PNG Ports Corporation Ltd v Canopus No 71 Ltd (2010) N4288. There, the Court gave detailed reasons why there should be a ready settlement of disputes. It also pointed out why a party refusing to enter into meaningful settlement discussions should be penalised with a costs order beyond the normal party/party costs. In the case then before the Court, the defendant made several attempts at having the substantive matter resolved before the matter ended up in Court. Upon the matter going Court, the parties were ordered to settle it and they did. They returned to the Court with the question of who should bear the costs of the proceeding and at what rate. The Court ordered indemnity costs against the Plaintiff for failing to enter into meaningful settlement discussions and settle the matter when the defendant made several efforts toward that.
69. My decision in this case to order costs on a solicitor client basis is also to reflect the failure of the Defendants here to give vacant possession as soon as they became aware of the Plaintiffs being the rightful legal owners of the property. Had the Defendants taken the steps they failed to take, this proceeding and its costs would have been avoided or substantially minimized. Unless the parties agree on the Plaintiffs’ costs, their costs shall be taxed.
69. Proceeding on the same foundation for the award of costs on a solicitor and own client basis, I order interest at 8% pursuant
to the Judicial Proceedings (Interest on Debts and Damages) Act 2015 to be calculated and added onto the judgment sum from the date of the issue of the writ until the judgment is satisfied in full.
__________________________________________________________
Twivey Lawyers: Lawyers for the Plaintiff
Raymond Obora Lawyers: Lawyers for the Defendants
[1] See for more cases on these principles see David Lambu v. Paul Paken Torato (2008) SC953; Rupundi Maku v. Steven Maliwolo (2011) SC1171; Jack Pinda v. Sam Inguba (2012) SC1181
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