Legal Index: A
Abuse of process and the assessment of damages — the leading Papua New Guinea authorities, what they decided, and where a member of the Court took a different view.
Abuse of process
When a proceeding, though regularly commenced, is one the court will not allow to continue — and the related question of when an issue has already been decided.
Telikom PNG Ltd v Independent Consumer and Competition Commission [2008] PGSC 5; SC906 (Supreme Court)
The Court held that a party who commences a multiplicity of proceedings about the same issues commits an abuse of process unless very good reasons are shown to justify doing so.
It also held that res judicata operates where the issues between the parties have already been finally determined by a court or tribunal with lawful authority to determine them.
On procedure, the Court drew a distinction that matters in practice: a party challenging the decision of a governmental body or public authority must use Order 16 of the National Court Rules if orders in the nature of the prerogative writs are sought. But where only an injunction or a declaration is sought, the plaintiff has a choice and may proceed under Order 4 or Order 16.
Applying that, the Court held unanimously that the National Court had erred in finding that Telikom was obliged to proceed under Order 16, because Telikom sought only declarations and injunctions. Kirriwom and Cannings JJ nonetheless upheld the findings of abuse of process and res judicata.
Injia DCJ, dissenting in the same case — his Honour took the view that res judicata is a substantive and complete defence to an action, which must be pleaded and tried, rather than a basis for summarily terminating a proceeding.
The difference is practical rather than academic. On the majority’s approach a defendant can raise res judicata on a motion to dismiss; on the Deputy Chief Justice’s approach the defence belongs in the defence, and is determined at trial on evidence. A party met with a dismissal application founded on res judicata should read the dissent.
The National Court’s power to stop an abusive proceeding is in Order 12 Rule 40 of the National Court Rules 1983, which allows the Court to stay or dismiss proceedings that are frivolous or vexatious or an abuse of the process of the Court. See dismissal for abuse of process.
Appeals — when leave is required
Whether an appeal to the Supreme Court lies as of right or requires leave, and what must be filed.
Yakham v Merriam [1997] PGSC 32; [1998] PNGLR 555 (Supreme Court)
The Court drew the distinction by reference to the nature of the grounds, under section 17 of the Supreme Court Act and Order 7 of the Supreme Court Rules:
Questions of law, or of mixed fact and law — the appeal lies as of right, and a notice of appeal is filed in Form 8.
Questions of fact only — an application for leave is required, filed in Form 7.
It follows that where an appeal raises law, mixed fact and law, and fact, separate notices in both forms must be filed. The Court held that the then third alternative in paragraph 2 of Form 8 — stating that leave would be sought at the hearing of the appeal — was without legal basis and must be deleted.
The Court overruled Opai Kunangel v The State [1985] PNGLR 144 and referred to Tsang v Credit Corporation [1993] PNGLR 112. Because of the divergence of opinion in the earlier authorities, it declined as a matter of fairness to uphold the objections taken in the case before it.
Characterising a ground as one of law, fact, or mixed fact and law is the first task in drafting an appeal, and getting it wrong is fatal to the ground rather than merely inconvenient.
Note also section 14(3)(b) of the Supreme Court Act, which requires leave to appeal an interlocutory judgment — a separate question from the one Yakham decides. See appealing an interlocutory order.
Assessment of damages
What a plaintiff must still prove once liability has been resolved — by default judgment, by consent, or after a trial on liability alone.
Coecon Ltd (Receiver/Manager Appointed) v National Fisheries Authority [2002] PGNC 144; N2182 (National Court, Kandakasi J)
The Court set out the principles that govern an assessment of damages after liability has been determined. In summary:
(1) Where liability has been resolved by consent judgment, the defendant is not at liberty to reopen liability, or the plaintiff’s entitlement to a particular item of damage that has been pleaded. A consent judgment cannot readily be set aside except on appeal, or in fresh proceedings founded on fraud or mistake.
(2) A defendant is not precluded from taking issue on any matter that has not been pleaded in the statement of claim.
(3) Where a defendant takes no issue with an unpleaded matter introduced at the hearing, the Court may still allow the claim if the evidence supports it.
(4) In a breach of contract case, judgment on liability establishes the breach and leaves for assessment the damages that necessarily follow from it.
(5) Whether liability was resolved in default or by consent, the plaintiff remains under an obligation to prove damages on the balance of probabilities — and where that standard is met, the damages must be awarded.
Mel v Pakalia [2005] PGSC 36; SC790 (Supreme Court) — an appeal against an assessment of damages following default judgment. The Court cited Coecon among the governing authorities, found that the trial judge had erred in law, allowed the appeal and itself assessed damages at K15,900 together with interest and costs. The judgment also records the Court’s remarks on the non-appearance of the Solicitor-General.
Papua New Guinea Banking Corporation (PNGBC) v Tole [2002] PGSC 8; SC694 (Supreme Court) — decided a few months after Coecon and routinely cited with it on the relationship between what is pleaded and what may be recovered. It is one of the authorities relied on in Mel v Pakalia.
Default judgment is not a substitute for proof. In most cases it establishes liability and leaves the plaintiff to prove every element of loss by evidence at the assessment.
That matters especially against the State, because section 12(3) of the Claims By and Against the State Act 1996 provides that except where the claim relates to a debt only, judgment against the State in default is for damages to be assessed.
And the pleading governs the recovery. A head of loss that was never pleaded may be met at the assessment with the objection that Coecon expressly preserves. See what a pleading must contain and how damages are assessed.