Because Rule 24 says only that security shall not be required unless the court otherwise directs, everything about the order — amount, form, timing, consequences — is in the direction the Court makes.
What the figure represents
Security is set by reference to what the respondent would be likely to recover on taxation if the appeal failed and costs followed the event — not to what the respondent will actually pay their lawyers.
Order 12 of the Supreme Court Rules 2012 governs costs, and the scales and the taxation provisions are the reference point. A respondent seeking security should put on evidence of the estimated taxable costs, item by item, rather than a round figure.
The size of the appeal book. A three-day trial with fifteen witnesses produces a very different book from a summary judgment application.
The number of grounds. Twelve grounds cost more to answer than three.
Whether counsel must travel. Where the parties are outside Port Moresby, the Order 11 Rule 4 requirement of an address for service within 15 kilometres of the Registry means an agent, and agent’s costs.
Whether there is a cross-appeal. Costs occasioned by the cross-appeal are the cross-appellant’s, not the appellant’s.
Security is rarely full indemnity
Too little security leaves the respondent exposed. Too much shuts the appellant out of a court they are entitled to be in — and the right of appeal conferred by section 14 of the Supreme Court Act, read with the protection of the law in section 37 of the Constitution, is not to be defeated by an order the appellant cannot meet.
An order for security is therefore usually for a sum that is real but short of a full indemnity, and it is common for the figure to be fixed in stages — an amount now, with liberty to apply for more if the appeal proves longer than expected.
An appellant resisting the amount should put on evidence of means. That evidence is tested, and an appellant who understates assets to resist security and later relies on those assets elsewhere invites serious difficulty.
How security is given
| Form | Comment |
|---|---|
| Payment into Court | The usual order; the money is held by the Registrar |
| Bank guarantee | Accepted where the guarantor is a bank operating in Papua New Guinea |
| Undertaking by a solicitor holding funds | Only where the funds are identified and held |
| Charge over identified property | Uncommon; enforcement is slow and the value may be disputed |
| Payment by instalments | Sometimes ordered where the appellant has income but no capital |
A Form 4 application under Order 13 Rule 15 should specify both — the sum sought, the form in which it is to be given, and the date by which it is to be provided.
Order 13 Rule 15 requires every application for interlocutory orders to contain a concise statement of the Court’s jurisdiction to grant the orders being sought. Cite Order 7 Rule 24 and section 5(1)(c) of the Act.
The date in the order
An order for security almost always fixes a date. Section 5(1)(d) of the Act allows a Judge to make an order dismissing an appeal in any proceedings (other than criminal proceedings) for default in furnishing security — so the date is the point on which the appeal turns.
An appellant who cannot meet the date should apply to extend it before it passes, with evidence of what has been done to raise the money. See default in furnishing security.
Changing the amount
A direction or order made by a single Judge under section 5(1) may be discharged or varied by the Supreme Court.
And under section 10(2), where a Judge refuses an application in relation to a matter specified in section 10(1), the appellant may apply to the Supreme Court to have the matter determined by that Court — though section 10(1) is confined to leave to appeal, extensions of time, and bail.
The practical route where circumstances change is an application to vary, supported by evidence of the change: an appeal that has grown, or an appellant whose means have altered.
What happens to the money
If the appeal succeeds, the security is released to the appellant. If it fails and costs are ordered against the appellant, the security stands as a fund out of which the taxed costs are paid, with any balance returned.
If the appeal is discontinued, Order 7 Rule 22 makes the appellant liable for the costs occasioned by the appeal except in criminal appeals, and Rule 23 allows the respondent to tax those costs and, if unpaid within 14 days after service of the certificate of taxation, to enter judgment for them. The security is available against that judgment.
Where there is a cross-appeal
A cross-appellant is an appellant in respect of the cross-appeal, and is exposed to an application for security in the same way. Rule 24 and section 5(1)(c) are not confined to the party whose name appears first.
Where both sides seek security, the sensible course is one application dealing with both, so that the sums can be set against each other rather than each party funding the other’s appeal. See cross-appeals.
Sources
- Supreme Court Rules 2012 — O 7 rr 22–24; O 11 r 4; O 12; O 13 r 15; Form 4
- Supreme Court Act (Chapter 37) — ss 5, 10, 14
- Constitution of the Independent State of Papua New Guinea — s 37
Before relying on anything here, read the current text of the Supreme Court Rules 2012 and check for later amendments. If a decision matters to you, get advice — start with the Office of the Public Solicitor, or find a firm in the law firms directory.