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Dube v JSS Holdings Ltd [2025] PGNC 302; N11441 (11 August 2025)

N11441


PAPUA NEW GUINEA
[NATIONAL COURT OF JUSTICE]


WS NO. 101 OF 2021


BETWEEN:
STEVEN DUBE
Plaintiff


AND
JSS HOLDINGS LIMITED
Defendant


KIMBE: WOOD J
3 JUNE, 11 AUGUST 2025


ASSESSMENT OF DAMAGES - Trial on assessment of damages following the entry of default judgment - the plaintiff and defendant entered into an oral agreement for the purchase of an embroidery machine, which on delivery was found to be defective and did not work – the defendant refunded the purchase price of K18,500 within one week of the matter being brought to its attention – the plaintiff claimed the value of the loan for the purchase of the machine, plus significant losses and damage relating to the failure of his business and loss of income and personal injuries, including insomnia, hypertension and heart disease


Notwithstanding the entry of default judgment, the plaintiff’s claim lacked particulars and he did not provide sufficient evidence of his supposed loss and damage – furthermore, in applying the principles in Hadley v Baxendale, the Court was not satisfied that the plaintiff demonstrated that his loss and damages could be reasonably viewed to have resulted naturally from the breach of agreement or misrepresentation, or that such alleged loss and damages could be reasonably contemplated by the parties when the agreement was entered into for the purchase of the embroidery machine


Held – the relief sought by the plaintiff was refused – because default judgment had been entered against the defendant, the parties are ordered to bear their own costs of the proceeding


Cases cited
Hadley v Baxendale (1854) 9 Exch 341
William Mel v Coleman Pakalia (2005) SC790


Counsel
Mr B Takua for the plaintiff
Mr P Mokae for the defendant


JUDGMENT


  1. WOOD J: The trial before the Court related to the hearing of the assessment of damages, in circumstances where default judgment was granted on 9 February 2023 in relation to the plaintiff’s Writ of Summons and Statement of Claim filed on 12 April 2021 (the Statement of Claim).
  2. At the trial, the plaintiff relied upon the following affidavits, namely:
    1. Affidavit of Paul Saleu sworn on 30 November 2021 and filed on
      2 December 2021;
    2. Affidavit of Charlie Saile sworn on 30 November 2021 and filed on
      2 December 2021;
    1. Affidavit in Response of Steven Dube sworn on 12 October 2022 and filed on 13 October 2022;
    1. Affidavit in Support of Dr William Mol sworn on 16 November 2023 and filed on 17 November 2023;
    2. Affidavit of Helen Bula sworn on 31 December 2023 and filed on 8 March 2024; and
    3. Affidavit of Steven Dube sworn on 1 May 2025 and filed on 2 May 2025.
  3. The defendant relied upon the following affidavits, namely:
    1. Affidavit of Zhi Liang Ling sworn on 11 August 2022 and filed on
      12 August 2022; and
    2. Affidavit of Zhi Liang Ling sworn on 13 November 2023 and filed on 16 November 2023.
  4. There was no cross examination of witnesses at the trial.
  5. For the purpose of the conduct of the trial, the parties signed a Statement of Agreed and Disputed Facts, which was filed on 4 March 2025.

Background

  1. In the Statement of Claim, the plaintiff claims that in 2015, the plaintiff and the defendant entered into an oral agreement (the agreement), whereby the defendant offered to sell him a new embroidery machine (the machine) in the amount of K18,500. The plaintiff claims that he obtained an SME business loan of K25,000 from PNG Microfinance Limited in order to purchase the machine and that he used part of the funds from the loan to run the embroidery business, which was registered as his business under the name of Wantok SMK Services.
  2. In the Statement of Claim, the plaintiff claims that he paid the defendant the amount of K18,500 and kept the balance of the loan to run his embroidery business in Kimbe. He claims that when he received the machine, it was defective and dysfunctional and that he could not stitch logos, slogans, names, letters and designs. He claims he immediately returned the machine to the defendant and that after two months and 12 days, he issued a forewarning notice to advise that he would take the matter to court. He states that the defendant responded by refunding the amount of K18,500 to him.
  3. In the Statement of Claim, the plaintiff claims that the defendant breached the terms of the agreement, by failing to produce a brand new machine (as agreed), or further, failed to replace the faulty machine. The plaintiff also claims that the defendant engaged in an act of misrepresentation by stating that the machine was brand new and that it was fully equipped with accessories and a warranty, when this was not the case.
  4. In summary, the plaintiff claims that he suffered loss of business from 17 July to 29 September 2015, loss of regular clients and business opportunities and that his business operations were permanently affected. He also claims that he lost certain property and cash to PNG Microfinance Limited and that Wantok SMK Services ceased operation and that his business reputation was tarnished. He also claims that he and his family suffered ‘from pain, depression, emotional distress, psychological anguish, financial struggle, pressure and difficulties, loss of enjoyment of life due to the loss of properties and business as result of the Defendant’s actions, inactions and or omissions.’ He also claims he suffered from pressure and stress and serious health issues of hypertension and angina pectoris.
  5. Noting that default judgment has already been determined by the Court, I refer to the Supreme Court decision in William Mel v Coleman Pakalia (2005) SC790, per Justices Los, Jalina and Cannings, where the following principles were stated at pages 13 and 14, namely:

    ‘In assessing damages we will apply the following principles:


Entry of default judgment and assessment of the pleadings and evidence


  1. In consideration of the above principles which are summarised in William Mel v Coleman Pakalia (supra), I note the Statement of Claim pleads that as part of the agreement, it was agreed the plaintiff was to obtain an SME loan from PNG Microfinance Ltd in the amount of K25,000, repayable within 24 months at 24% interest per annum and that the plaintiff would repay PNG Microfinance Ltd the loan of K46,000. In this regard, the plaintiff’s two affidavits filed on 13 October 2022 and 2 May 2025 do not make any reference whatsoever as to what was discussed between him and the defendant regarding the purchase of the machine.
  2. In reply, in the affidavit of Zhi Liang Ling filed on 12 August 2022, Mr Zhi states that the defendant never agreed to the plaintiff taking out a loan for the purchase of machine. Indeed, in paragraph 8 of his affidavit, he describes that claim as ‘absurd’. Moreso, it is implausible that the plaintiff would know the precise terms of the loan until that loan was approved, and so I find there is no credibility to his claim that he would buy the machine, based on a loan being obtained on certain terms as detailed above in this paragraph. Because of these issues, and because it would be implausible that the defendant would agree to sell the machine, which included specific terms or requirements by PNG Microfiance Limited that could not be known prior to the plaintiff securing the loan, I do not accept that it was agreed between the plaintiff and the defendant that it was a term for the purchase of the machine that the defendant would agree to him seeking a loan from PNG Microfinance Ltd.
  3. The Statement of Claim pleads that in 2015 the plaintiff and the defendant entered into the agreement, however, the date of the agreement or approximate date of the agreement were not pleaded. Neither did the plaintiff’s two affidavits provide any evidence of that date. Other than the tax invoice dated
    9 June 2015, the plaintiff’s affidavits did not attach a copy of any receipt for the purchase of the machine or the terms and conditions of the sale of the machine.
  4. The Statement of Claim pleads that upon realising the machine was defective, he immediately returned it to the defendant, however, the Statement of Claim does not provide any specific details or particulars as to how the machine was defective, nor was it pleaded what date he returned the machine to the defendant. There was also no evidence adduced by the plaintiff as to what date he returned the machine to the defendant. While the Statement of Claim pleads that after two months and 12 days, he issued a forewarning notice to the defendant that he would take the matter to Court, there was no evidence adduced by the plaintiff as to what date he gave the forewarning notice.
  5. In this regard, I note that annexure A to the plaintiff’s affidavit filed on
    13 October 2022 is a copy of a letter from the plaintiff to the defendant dated 2 October 2015 in which the plaintiff stated that the machine was faulty and that he stated he was now submitting his claim to ‘... JSS Holdings Limited to settle my Outstanding Loan Balance from Peoples Micro Bank and Loss of Business’, however, the Loan Agreement Form that the plaintiff referred to in that letter was not attached to his affidavit. It is also not clear, whether the forewarning letter that is referred to in the Statement of Claim is the same as the plaintiff’s letter dated 2 October 2015.
  6. Mr Zhi further stated in his affidavit that he immediately arranged for the manufacturer in China to reimburse the plaintiff the amount of K18,500, and that the plaintiff was reimbursed within a week when the issue came to the defendant’s attention.
  7. Notwithstanding that default judgment was entered on the plaintiff’s claim on breach of agreement and misrepresentation, it was incumbent upon him to plead all necessary particulars of his claim and adduce all relevant evidence. On the basis of the above-mentioned matters, he failed to do this. At best, I can only be satisfied from the entry of default judgment that he bought the machine, which he subsequently discovered was faulty. The plaintiff then returned the machine to the defendant, who on the uncontested evidence of the defendant, refunded him the amount of K18,500 within one week of the issue coming to the defendant’s attention.

    The measure of damages (if any)
  8. The leading case on the measure of damages is the decision of Hadley v Baxendale (1854) 9 Exch 341, in which case Mr Hadley owned a mill which had a broken crankshaft. He engaged the defendant (Mr Baxendale) to take the crankshaft to a location where it could be repaired and then returned to the mill. Mr Baxendale subsequently made a mistake, which resulted in the crankshaft being returned to Mr Hadley one week later than agreed, during which time
    Mr Hadley’s mill was out of operation. Mr Hadley subsequently claimed for the loss of profit as a result of the week long closure of the mill. In
    Mr Baxendale’s defence, he took the position that the court proceeding was unreasonable, because he had not known that the delay in the return of the crankshaft would result in the closure of the mill and he argued that the loss of profits claim, failed to satisfy the test of remoteness.
  9. In its decision, the Court of Exchequer stated as follows:

    ‘Where two parties have made a contract which one of them has broken, the damages which the other party ought to receive in respect of such breach of contract should be such as may fairly and reasonably be considered either arising naturally, i.e., according to the usual course of things, from such breach of contract itself, or such as may reasonably be supposed to have been in the contemplation of both parties, at the time they made the contract, as the probable result of the breach of it. Now, if the special circumstances under which the contract was actually made where communicated by the plaintiffs to the defendants, and thus known to both parties, the damages resulting from the breach of such a contract, which they would reasonably contemplate, would be the amount of injury which would ordinarily follow from a breach of contract under these special circumstances so known and communicated. But, on the other hand, if these special circumstances were wholly unknown to the party breaking the contract, he, at the most, could only be supposed to have had in his contemplation the amount of injury which would arise generally, and in the great multitude of cases not affected by any special circumstances, from such a breach of contract. For such loss would neither have flowed naturally from the breach of this contract in the great multitude of such cases occurring under ordinary circumstances, nor were the special circumstances, which, perhaps, would have made it a reasonable and natural consequence of such breach of contract, communicated to or known by the defendant.’
  10. The Court in Hadley v Baxendale (supra) determined the issue in favour of the defendant, on the basis that a party could only successfully claim for losses arising from breach of contract where the loss is reasonably viewed to have resulted naturally from the breach, or where the fact such losses would result from the breach ought reasonably have been contemplated by the parties when the contract was formed. As Mr Baxendale had not reasonably foreseen the consequences of delay and Mr Hadley had not informed him of them, the Court held he was not liable for the mill’s lost profits. In other words, the Court held that a party breaching a contract is liable for damages only that arise naturally from the breach itself, or secondly, where damages were reasonably foreseeable by both parties at the time of contract formation as a result of the breach. Essentially, a party is not liable for damages that were not reasonably foreseeable at the time the contract was made.
  11. In terms of the plaintiff’s claim in this proceeding, he did not adduce any evidence that he and the defendant agreed he would be seeking a loan from PNG Microfinance Limited. In addition, the plaintiff did not adduce any evidence that he informed the defendant that he would be taking out a loan in order to assist him to purchase the machine.
  12. In the plaintiff’s Notice to Rely filed on 2 May 2025, it is stated that he relies on affidavits of Paul Saleu sworn on 30 November 2021 and filed on
    2 December 2021 and the affidavit of Charlie Saile sworn on 30 November 2021 and filed on 2 December 2021. Based on what is stated in the affidavit of Paul Saleu and what was submitted by the plaintiff’s lawyer at the hearing on the assessment of damages regarding both affidavits, my understanding was that the intention of both affidavits were to adduce evidence about the loan that the plaintiff obtained from PNG Microfinance Limited. In this regard, the affidavit which is identified on the front page as being the affidavit of Charlie Saile (court document no. 7), was actually another copy (at pages 2, 3 and 4) of the same affidavit of Paul Saleu. In any event, nothing material turns on the mistake in photocopying by the plaintiff or his lawyer. This is because as the intention of the plaintiff was to show that he secured the loan from PNG Microfinance Limited, I am satisfied that he did indeed obtain the loan. However, for the reasons detailed earlier in this decision, I am not satisfied there is any evidence the defendant agreed it was a term for the purchase of the machine, that he would need to seek a loan from PNG Microfinance Limited. Nor any am I satisfied there is any evidence that the plaintiff made the defendant aware that he would be seeking the loan.
  13. In addition, while the two affidavits of the plaintiff make reference to the loan from PNG Microfinance Limited and attach certain loan documents, loan statements and other related documents, as well as letters of demand referring to the loan, those affidavits do not adduce any evidence the defendant agreed it was a term for the purchase of the machine, that he would need to seek a loan from PNG Microfinance Limited. Nor any am I satisfied there is any evidence in those affidavits that the plaintiff made the defendant aware that he would be seeking the loan. Furthermore, based on the above-mentioned principles in Hadley v Baxendale (supra), I am not satisfied that from the pleadings and evidence that the damages sought regarding the plaintiff’s loan with PNG Microfinance Limited could be reasonably viewed to have resulted naturally from the breach of agreement or misrepresentation. Nor am I satisfied it has been proven that any losses (based on a breach) could reasonably have been contemplated by the parties when the contract was reached for the purchase of the machine.
  14. As stated above, on the uncontested evidence of the defendant, the defendant refunded the plaintiff the amount of K18,500 within one week of the issue coming to the defendant’s attention. In other words, there was no evidence adduced by the plaintiff whether he took steps to buy another embroidery machine. Also, because the defendant refunded the plaintiff his money within one week, I am not satisfied that the defendant should pay the damages relating to the loan that are sought by the plaintiff.
  15. For the reasons stated above, the plaintiff’s claim for any losses relating to his loan with PNG Microfinance Ltd are refused. This includes any claim that he suffered consequential losses as a result of his default on that loan, such as his claim for the loss of his mortgaged property.


    Claim for loss of business and loss of profits and income
  16. The claim for loss of income and loss of profits and business is largely detailed in the affidavit of Helen Bula filed on 8 March 2024. Ms Bula deposes that she is a Certified Practising Accountant. On analysis of the affidavit, it does not provide any meaningful detail about what type of business the plaintiff conducted, other than to state that he had a Mini Stationery and Printing business and she had ‘... done my reviews and assessments based on the documents provided by Mr. Dube of Wantok SMK Services and has prepared a projected income statement for the period being from 29th September 2015 up to 31st December 2023 for Wantok SMK Services.’
  17. Ms Bula’s affidavit did not provide any other details about what type of business the plaintiff conducted prior to the purchase of the machine, including whether he provided products and services using another embroidery machine similar to the machine that he purchased from the defendant. Ms Bula’s affidavit was also lacking in any detail about the quantity and type of products and services the plaintiff allegedly provided prior to the purchase of the machine. At best, her affidavit made reference to the ‘mini stationary shop’, the ‘iron on heat press printing’, ‘stationaries’ and ‘materials from iron on heat press’, without specifying what products and services, and volume of products and services he provided prior to the purchase of the machine.
  18. As it is unclear whether the plaintiff had another embroidery machine prior to his purchase of the machine from the defendant, and because no previous months prior to 29 September 2015 were provided in the table in annexure A of her affidavit, I consider the table she generated is purely speculative. Furthermore, Ms Bula’s affidavit did not provide any reference to any of the plaintiff’s annual returns or other documents that would presumably have been lodged by him in previous years with the Internal Revenue Commission
    (the IRC) to demonstrate any revenue and sales figures in previous years. There were simply no IRC documents annexed to the affidavit, nor any other documents such as receipts, invoices or profit and loss statements. In effect, I find the affidavit to be of no evidentiary value and I reject it.
  19. In addition to Ms Bula’s affidavit, the plaintiff made reference in his affidavit filed on 2 May 2025 that he has suffered loss of business and has lost clients, however, his affidavit fell well short of providing any evidence in support of this claim. For example, in paragraph 9 of that affidavit, the plaintiff said he had placed a list of orders for uniforms from clients, but his affidavit did not set out the dates the orders were placed, the amount per unit he intended to sell each uniform and whether he had an embroidery machine in place which was selling that type of merchandise, prior to the purchase of the machine. His affidavit did not provide any evidence of purchase orders or other related documents as proof of those sales orders.
  20. The plaintiff also stated in paragraph 11 of his affidavit that he provided all business documents, including bank statements showing the transactions and income for this business between 2013 to 2017, however, other than the details of his loan with PNG Microfinance Limited, none of those documents were annexed to his affidavit or Ms Bula’s affidavit. Furthermore, there was no evidence adduced by the plaintiff about what, if any, embroidery machine he was using before he bought the machine. He did not provide any substantial evidence about what services he was providing prior to the purchase of the machine, including with reference to descriptions of those services and volume and revenue figures. In relation to the machine, he did not provide any details as to why it was not working, including any steps he took to have it fixed or inspected by a technician. He also did not adduce any evidence from an expert to state what was supposedly wrong with the machine, including whether the plaintiff had set the machine up correctly so that it would work. The plaintiff also did not adduce any evidence from a manual or other source to show what quantity of items the machine could produce. Furthermore, on the uncontested evidence of the defendant, the defendant refunded the plaintiff the amount of K18,500 within one week of the issue coming to the defendant’s attention. In other words, there was no evidence adduced by the plaintiff whether he took steps to buy another embroidery machine. Also, because the defendant refunded the plaintiff his money within one week, I am not satisfied that the defendant should pay the damages sought by the plaintiff.
  21. For the reasons detailed above, the plaintiff’s claim for loss of business and loss of profits and income is refused.

    Claim for personal injury
  22. The plaintiff’s causes of action were for breach of agreement and for misrepresentation. The plaintiff did not, for example, make a claim against the plaintiff in negligence or some other tort. In this regard, Order 8 Rule 33 of the National Court Rules provides what particulars shall be given by a plaintiff in death and personal injury cases, namely:

‘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).’


  1. On analysis of the plaintiff’s two affidavits and the affidavit of Dr William Mol, I am not satisfied that the affidavits provided evidence of those particulars which are required under Order 8 Rule 33 of the National Court Rules.
  2. Furthermore, I am not satisfied that the plaintiff’s claim for damages for personal injuries can be claimed under his causes of action for breach of agreement or misrepresentation. There are two reasons for this. The first reason is that I am not satisfied that based on the reasoning in Hadley v Baxendale (supra) that the plaintiff can argue that his claim for personal injuries can be reasonably viewed to have resulted naturally from the breach of agreement or misrepresentation, or that such alleged personal injury arising from the breach could reasonably be contemplated by the parties when the agreement was entered into for the purchase of the machine. This also includes the fact that on the uncontested evidence of the defendant, the defendant refunded the plaintiff the amount of K18,500 within one week of the issue coming to the defendant’s attention. Also, there was no evidence adduced by the plaintiff whether he took steps to buy another embroidery machine. I am also not satisfied from any other cases under the common law in Papua New Guinea that the plaintiff could claim for personal injuries based on his causes of action.
  3. Secondly, while the affidavit of Dr William Mol stated that the plaintiff was suffering from stress induced conditions of loss of appetite, weight, insomnia, peptic ulcer disease and hypertension resulting from ischemic heart disease, the affidavit did not make any reference to the plaintiff’s alleged loss of business or related matters. In other words, the affidavit did not set out any evidentiary basis to demonstrate the background facts regarding the purchase of the machine and his alleged loss of business in order to establish a causal link with his health issues. For the above reasons, the plaintiff’s claims for personal injury are dismissed.

    Summary
  4. Based on the above matters, all the plaintiff’s claims are dismissed. As to the issue of court costs, costs are a discretionary matter. Notwithstanding I dismissed the plaintiff’s claims for loss and damage, the fact remains that default judgment was entered in his faviour. Because of this reason, I consider that the parties should bear their own costs of the proceeding.

Orders


37. In the circumstances, I make the following orders:


  1. The claims for loss and damages, interest and costs and all other relief that are sought by the plaintiff in the hearing on the assessment of damages are refused.
  2. The proceeding is dismissed.
  3. The parties shall bear their own costs of the proceeding.
  4. The terms of these Orders are abridged to the date of settlement by the Court.

Lawyers for the plaintiff: Takua Lawyers
Lawyers for the defendant: Don Wapu Lawyers

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