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Makeso v Wereh [2023] PGNC 151; N10219 (28 April 2023)

N10219

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

WS NO. 193 OF 2022

BETWEEN:
MATARO MAKESO
Plaintiff

AND:
DAVID WEREH in his capacity as the Secretary of the Department of Works and Highways
First Defendant

AND:
DEPARTMENT OF WORKS AND HIGHWAYS
Second Defendant

AND:
THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Third Defendant

Goroka: Mugugia, AJ
2023: 21^st, 28^th April

CONTRACT – Claim for breach of contract - Whether the Plaintiff’s action is statute-barred – Section 16, Frauds and Limitations Act 1988 - Cause of action in breach of contract accrues on the date of the breach, not on the date of the contract – Plaintiff’s action not statute-barred.

Cases Cited:

Magiten v. Raka (2002) N2179
Nunulrea v. PNG Harbours Ltd. (2005) N2790

Counsel:

Karen Lafanama, for the Plaintiff
Russell Uware, for the Defendants

RULING ON WHETHER THE PLAINTIFF’S ACTION IS STATUTE -BARRED

28^th April, 2023

1. MUGUGIA, AJ: A written agreement dated 3^rd March 1999 was entered into between the Plaintiff and the Second Defendant through the Eastern Highlands Provincial Works Department. This was the Road/Bridge Maintenance Contract/Maintenance Agreement. The contract provided the scope of work.

2. As per the pleadings in the Plaintiff’s Statement of Claim endorsed to the Writ of Summons which was filed on 2^nd May 2022, the Plaintiff agreed to work for the lump sum of K710,000.00. The Plaintiff carried out the bridge maintenance work between 3^rd March 1999 and 3^rd May 1999 on 19 bridges. The Second Defendant, through its agents and servants certified that the maintenance work on the bridges was successfully completed. The First and Second Defendants, through their agents and servants only paid the Plaintiff K10,000.00. The balance of K700,000.00 remains outstanding. The Plaintiff filed the current proceedings seeking special damages in the sum of K1,049,845.54, loss of business, general damages interest and costs.

3. Pursuant to its inherent jurisdiction, the Court of its own volition required the parties to make submissions on whether the Plaintiff’s action is statute-barred. I heard Counsels’ submissions on this issue on 21^st April 2023, and reserved my ruling to 28^th April 2023. This is my short ruling.

4. Ms Lafanama of Counsel for the Plaintiff submitted that the last payment of K10,000.00 was made in 2018. Numerous follow-up letters were forwarded to the Department of Works. These letters are in evidence before the Court. The Plaintiff has been following up with the Department of Works since 1999. There was indication that the payment would be made to her client. He waited to see if there would be any payment. For this reason, her client did not go to Court.

5. Ms Lafanama submitted that this is a simple contract case where the cause of action accrues six (6) years after the date of accrual. The submissions are that her client’s cause of action accrued on 22^nd May 2019 when the Secretary for the Department of Works refused the claim. Time starts running after the refusal.

6. On the other hand, Mr Uware for the Defendants, submitted that time starts running at the time the contract ended, that is, 1999. Time runs after the contract.

7. I noted from the evidence before me that the issue of the Plaintiff’s action being time-barred was raised in a Minute done by the Department of Works’ lawyer Mr Jonathan Saka in 2019. He recommended for a way forward in settling the Plaintiff’s claim.

8. Section 16 of Frauds and Limitations Act 1988 reads:

“LIMITATION OF ACTIONS IN CONTRACT, TORT, ETC.

(1) Subject to Sections 17 and 18, an action–

(a) that is founded on simple contract or on tort; or

(b) to enforce a recognizance; or

(c) to enforce an award, where the submission is not by an instrument under seal; or

(d) to recover any sum recoverable by virtue of any enactment, other than a penalty or forfeiture or sum by way of penalty or forfeiture,

shall not be brought after the expiration of six years commencing on the date on which the cause of action accrue.”

9. It is settled law that a cause of action in breach of contract accrues on the date of the breach, not on the date of the contract: See Magiten v. Raka (2002) N2179 and Nunulrea v PNG Harbours Ltd. (2005) N2790.

10. Applying this to the present case, I find that the Plaintiff’s cause of action accrued in 2019 when the refusal to pay was made by the Secretary for the Department of Works. This is when the breach occurred. The proceedings was filed within six (6) years on 2^nd May 2022. This is a clear case where the Plaintiff’s claim is not statute-barred or time-barred. I therefore find that the Plaintiff’s action is not statute-barred.

11. I am of the view that the Plaintiff’s claim is a genuine one. The matter should be progressed to trial. There may be room for settlement of the Plaintiff’s claim.

FORMAL ORDERS

12. I make these orders:

1. The Plaintiff’s action is not statute-barred.

2. The matter is adjourned to 22^nd May 2023 at 9:30am for Mention.

3. Time is abridged to the date of settlement of these orders.

Court orders accordingly.

Public Solicitors: Lawyers for the Plaintiff
Office of the Solicitor General: Lawyers for the Defendants