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Credit Corporation (PNG) Ltd v Jee [1988] PGNC 24; [1988-89] PNGLR 11; N696 (18 November 1988)

N696

PAPUA NEW GUINEA
[NATIONAL COURT OF JUSTICE]

CREDIT CORPORATION (PNG) LTD

V

GERALD JEE

Waigani
Woods J

11 November 1988
18 November 1988

PRACTICE AND PROCEDURE - Discovery - Automatic discovery - Notice for - Failure to comply - Default procedures available - Discussion of nature of automatic discovery - National Court Rules, O 9, rr 1, 2, 15.

DISCOVERY - Automatic discovery - Under Rules of Court - Nature of - Notice for - Failure to comply - Default procedures available - National Court Rules, O 9, rr 1, 2, 15.

Held

Where a notice for automatic discovery is given pursuant to O 9, r 1, of the National Court Rules and where the party to whom the notice is given being a defendant, fails to comply therewith, he is in default for the purposes of O 9, r 15, and his defence may be struck out and judgment entered against him.

Discussion of the scope and purpose of the rules relating to automatic discovery.

Cases Cited

Chipchase v Rosemond [1965] 1 WLR 153; [1965] 1 All ER 145.
Donaldson v Harris (1973) 4 SASR 299.

Motion

This was an application on notice seeking to strike out a defence in default of compliance with a notice of discovery given pursuant to O 9, r 1, of the National Court Rules.

Counsel

D R Toll, for the applicant/plaintiff.
C Cholai, for the respondent/defendant.
Cur adv vult

18 November 1988

WOODS J: The plaintiff, Credit Corporation (PNG) Ltd, has applied to this Court that in default by the defendant in replying to a notice for discovery the defendant’s defence should be struck out and as a consequence thereon judgment be signed for the plaintiff.

In this case the defendant is being sued as a guarantor of an arrangement for which the plaintiff has already received a judgment against the defaulting debtor. These proceedings have already been the subject of an interlocutory ruling on an application to strike the defence out and sign judgment. After my refusal in September to strike out the defence the plaintiff immediately served a notice for discovery. The defendant has failed to answer that notice except to refuse to comply.

In refusing to comply, the defendant is ignoring his responsibility. A notice for discovery in this situation is not a particular notice but a general one. The National Court Rules do not require a notice to be particular. This is not a jurisdiction of trial by ambush. Discovery in this type of proceedings is the title used to describe the process by which the parties to a civil cause or matter are enabled to obtain, within certain defined limits, full information on the existence and the contents of all relevant documents relating to the matters in question between them. The function of the discovery of documents is to provide the parties with the relevant documentary material before the trial so as to assist them in appraising the strength or weakness of their respective cases, and thus to provide the basis for the fair disposal of the proceedings before or at the trial or to adduce in evidence at the trial relevant documentary material to support or rebut the case made by or against them, to eliminate surprise at or before the trial relating to documentary evidence and to reduce the costs of litigation. Discovery should not be confused with the process of obtaining further and better particulars, nor with the process of interrogatories, nor of subpoena duces tecum.

Discovery is therefore to help the parties and, in the end, the Court to obtain a proper examination of the issues and a party is therefore entitled to discovery of any documents that relate to the issues. A document is discoverable if it throws light on the issues: Donaldson v Harris (1973) 4 SASR 299.

A party is obliged to disclose all documents in his possession, custody or power which relate to the matter in question. The rules quite clearly cover this.

A lawyer clearly has a professional responsibility to ensure that his client gives complete discovery. Discovery is not a matter of bargaining or compromising or demanding an exact list of the documents sought. It is the obligation on a party to supply a list of all the documents which might have any bearing on the subject matter in dispute. Of course, there is provision to allow for claims of privilege and this needs to be set out in the affidavit verifying the list.

In this case the defendant has deliberately refused to comply. A party cannot just ignore court process — if he does, he does so at his peril.

Order 9, r 15, of the National Court Rules provides that when a defendant is in default the court can order that his defence be struck out and judgment be entered accordingly. There is no prerequisite here that a party must first seek a court order to enforce discovery before the default provision can be availed of.

The rules quite clearly prescribe automatic discovery, see O 9, r 2, which requires a party to give discovery if a notice is served on him. Of course, there are specific rules providing for the court to order discovery in other causes of action or for particular discovery but these are only in addition to the rule requiring automatic discovery. These rules clearly accord with the rules in other common law jurisdictions, for example in the United Kingdom, and I refer to the comments of Pennycuick J in the case Chipchase v Rosemond [1965] 1 All ER 145 where, in answer to the suggestion that default action can only be taken following an order for discovery, he said (at 147):

"I did not think that that argument is well founded. Rule 2(1) prescribes automatic discovery. Rule 3(1) gives a party the right, if he is so minded, to obtain an order for discovery including, if thought fit, an affidavit verifying the list. He may or may not take that course, but [whether he does so or not] the fact that he has the right to take the course does not, I think, preclude him from applying under r 17(1) to have the action dismissed. Merely on the ground of failure to comply with the automatic obligation to make discovery under r 2(1) he can if he likes apply, it seems to me, for dismissal under r 17(1), without first taking the optional step of obtaining an express order for discovery."

Whilst the English rules referred to are worded differently, I am satisfied that the intent of our rules is similar. Our r 15 clearly provides that in an action commenced by writ of summons default action can be sought and there is no precondition that a court order must first be sought, the wording in the rule is "as required by or under this Division" and the words in the rule make no reference to "as ordered".

In the circumstances, although I refused to strike out the defence in September, now that the defendant has deliberately refused to comply the plaintiff is entitled to the default procedure. I therefore order that the defence be struck out and I enter judgment for the plaintiff for K206,062.19.

Defence struck out Judgment for plaintiff

________________

Lawyers for the plaintiff: Henao Cunningham & Co.
Lawyer for the defendant: C Cholai.