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Investcorp Ltd v Hearney [1999] PGNC 81; N1903 (10 September 1999)

Unreported National Court Decisions

N1903

PAPUA NEW GUINEA

[NATIONAL COURT OF JUSTICE]

WS 585 OF 1999
INVESTCORP LIMITED - FIRST PLAINTIFF
PACIFIC HELICOPTERS LIMITED - SECOND PLAINTIFF
V
FRANK JOSEPH HEARNEY - FIRST DEFENDANT
OMEGA AVIATION INC - SECOND DEFENDANT

Waigani

Woods J
7 September 1999
10 September 1999

PRACTICE AND PROCEDURE - Service of originating process out of jurisdiction.

Counsel

S Nutley for the Plaintiffs

W Neil for the First Defendant

10 September 1999

WOODS J: This matter has come before the Court on an application to set aside service of the Notice of originating process outside the jurisdiction on the first defendant. On the 14 June 1999 Writ of Summon filed and iand in effect it sought an order for account of the use and operation of an aircraft since May 1998 and for an orderthe return of the aircraft to Cairns, Australia. It appears to be an argument over the conv conversion of an aircraft, a Kamov Ka-32T Helicopter, by the first defendant to his own use.

After the Writ was filed the plaintiffs sought and obtained ex parte an order for leave to serve the originating process outside of Papua New Guinea. In support of the application there was an affidavit from a Mr M Smith an officer of the second plaintiff which referred to an arrangement between the first plaintiff, a Company resident in Vanuatu and a Company in Russia for the lease of aircraft for carrying out projects in Papua New Guinea and Indonesia. There was no reference to any contract or agreement between the plaintiffs and the first defendant apart from a reference in the affidavit to the fact that the first defendant was employed by the first plaintiff. The supporting affidavit then avers to a belief that the first defendant without the consent of the plaintiffs caused the aircraft to be flown to a location in the Philippines.

For service outside of Papua New Guinea one must refer to National Court Rules Order 6 Rule 19 which sets out the cases where such service may be considered, and they include:

(a) ;&#16ere the proe proceedineedings are founded on a cause of action arising in PNG

(b) ;ټ <  &ـ hneacPNin f a cont contract...

(c)p>(c)&#160  ـ for enfercement of t of a breach of contract made in .or ged bylaw of PNG

(d)ټ &#160ndeduon t on t on tort tort cort commitommitted in PNG

(e) ҈ foundedunded on recovery mf damages sed in..

It is submitted on behalf of the first defendant that there is nothing hing in thin the writ nor in the lease documents ref to wgivesjurisdirisdiction to this court to determine any any claimclaim between the plaintiffs and the first defendant. It is submitted that the cause of action in so far as it pleads a tort against the first defendant, it appears to be the tort of conversion which may have been committed in Queensland, Australia. The originating process does not plead any breach of contract between the plaintiffs and the first defendant, there is no reference to the first defendant in the lease referred to in the affidavit of M Smith of 8 June 1999. The parties to the lease of the aircraft referred to have addresses outside of Papua New Guinea and there is no suggestion or evidence that the lease was made in Papua New Guinea in so far as that may be relevant. The Lease clearly states that the agreement shall be governed by the laws of Queensland and the parties agreed to submit to the non-exclusive jurisdiction of the Courts of the State of Queensland. The plaintiffs appear to be relying on Order 6 Rule 19 (e) namely for damages suffered wholly or partly in Papua New Guinea cause by a tortious act or omission wherever occurring. It would appear that the damages are consequent upon the failure of the plaintiffs to be able to utilise the aircraft within PNG during the period of the Lease agreement. However the time of the lease is uncertain, it is stated to have been executed in January 1996 and was to be for periods of 3 months but the total period was not to exceed 12 months. There is reference to an extension of the lease but that is dated in September 1996

I find that the originating process is based on a tort alleged to have taken place outside of Papua New Guinea. In so far as there may be some claim for a breach of a contract there is no reference to any contract between a company resident in Papua New Guinea and the first defendant, nor is there any reference to the presence of the first defendant in Papua New Guinea nor submitting to the jurisdiction of the court of Papua New Guinea. There is a suggestion that there may have been some agreement between the first plaintiff and the first defendant however neither of those parties are resident in Papua New Guinea. It may be that there is some dispute between the first and second plaintiff over the actions of the first defendant as an employee of the first plaintiff. There was insufficient material before the court to show that there was any subsisting lease rights for the aircraft in May 1998 being the date of the alleged conversion therefor there is insufficient material before the court to support any claim for damages within Papua New Guinea for damages against the first defendant.

I set aside the ex parte order of 18 June 1999 granting leave to serve originating process out of Papua New Guinea.