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Kapi v Sheppard and Maladina [2003] PGNC 153; N2323 (20 January 2003)

N2323

PAPUA NEW GUINEA

[IN THE NATIONAL COURT JUSTICE]

WS. 721 OF 2001

BETWEEN:

TAKAI KAPI also known as "TATAKI KAPI"

Plaintiff

AND:

GREGORY JAMES SHEPPARD & HARVEY MALDINA
trading as MALADINAS LAWYERS

First Defendants

AND:

AON RISK SERVICES (PNG) LIMITED

Second Defendant

WAIGANI: KANDAKASI, J.

2002: 6th December
2003: 20th January

LAWYER CLIENT – Former client suing lawyer for alleged negligence in conduct of his trial – Whether immunity for barristers available at common law also available to lawyers in Papua New Guinea? – Given the level of education and the dependence of people on lawyers for proper advise and appropriate action, it is inappropriate for the application of the immunity principle in Papua New Guinea – A lawyer is duty bound to act appropriately for his client both in advising and making representations or submissions in court – A former client is entitled to bring an action in negligence against his former lawyers.

PRACTICE & PROCEDURE – Cause of action – Negligence of lawyer in conduct of client’s case in court – Principles of immunity against such action at common law for barristers considered – In the circumstances of the country, the principles granting immunity for barristers over claims of negligence are inappropriate and therefore rejected – A former client may sue his former lawyer for breach of his duty of care to the client in the conduct of the client’s case in court.

Papua New Guinea Cases Cited:
Mt. Kare Holdings Pty Ltd vs. Akipe & Ors [1992] PNGLR 60.
ABC Co. Transport Pty Ltd vs. Timothy Sakaip N1577.
Kia Temai vs. Motor Vehicles Insurance (PNG) Trust N1442.
Martha Limitopa vs. The Independent State of Papua New Guinea and Anor [1988-89] PNGLR 364.
Motor Vehicles Insurance Ltd vs. Martha Kuma SC650.
Busina Tabe vs. The State [1983] PNGLR 10.
Benard Juali vs. The State SC667 (Unreported Judgement delivered 30/08/01).
The State vs. Rabaul Shipping Ltd & Rita Rurul (Unreported judgement delivered 08/12/00) N2022.
Mt. Hagen Airport Hotel Pty Ltd vs. Gibbs [1996] PNGLR 216.
PNG Forest Products Pty Ltd & Anor vs. The State & Anor [1992] PNGLR 85.
Runie Wabia vs. BP Exploration Operation Co. Ltd & Ors. (1998) N1697.

Overseas Cases Cited:
Rondel vs. Worsley [1969] 1 C 191.
Saif Ali vs. Sydney Mitchell and Co. [1980] AC 198.
Rees vs. Sinclair [1974] 1 NZLR 180.

Counsel:
Mr. G. Shepherd for the First Defendants/Applicants.
Mr. Kamaken for the Plaintiff/Respondent.

20th January 2003

KANDAKASI, J: The plaintiff is suing the defendants claiming negligence against the first defendants, Messrs Gregory James Sheppard and Harvey Maladina trading as Maladinas Lawyers, ("Maladinas"). This concerns Maladinas’ conduct in an election petition presented against the plaintiff by a loosing candidate in the 1997 PNG National General Elections for the Wabag Open seat. Maladinas are now applying by motion for a dismissal of these proceedings on the grounds of it being frivolous, within the meaning of O.12 r.40 of the National Court Rules ("the Rules"). That is in turn premised on the principle of special immunity of barristers against actions for negligence by their former clients, which has been recognised for at least over 200 years at common law.

Maladinas argue that under schedule 2.2 (3) of the Constitution as considered and applied in Mt. Kare Holdings Pty Ltd vs. Akipe & Ors [1992] PNGLR 60, the principles special immunity for barristers were adopted at independence and are therefore part of the common law in Papua New Guinea. They acknowledge that there is no decision of the Courts in the country specifically dealing with this issue of immunity of barristers or lawyers for that matter. At the same time, they acknowledge that a number of statements were made in relation to professional negligence against counsel but they say these were obiter dictums only. The case of ABC Co. Transport Pty Ltd vs. Timothy Sakaip N1577 is cited as an example.

In the alternative, the lawyers argue that the Supreme Court held that on the evidence in the prior proceedings, it was sufficient for the plaintiff to be disqualified. There was unequivocal evidence given by the plaintiff before the trial judge and that the application by the plaintiff to be enrolled on the common roll was late and in contravention of s.60 of the Organic Law. In any case, the evidence for the plaintiff was that he completed the application for enrolment on 16th April 1997 well after the period allowed under s.60. I therefore gather that the argument is that there is no factual basis for this action and as such I should dismiss in the exercise of the discretionary powers vested in me under O.12 r.40 of the Court Rules.

The plaintiff argues against an application of the immunity principles for a lawyer saying it is inappropriate to the circumstances of the country and, as such the application should be dismissed. As for the alternative argument by Maladinas, the plaintiff submits, the claim is based on negligence and this requires an examination of the facts including the relevant judgements of the National and Supreme Courts and as such it is not a straightforward matter. As such, the matter cannot be frivolous and therefore cannot be disposed off summarily.

Issue

This presents two main issues for determination. These are:

(1) Whether the immunity available to a barrister in other jurisdictions in relation to his representation of a client in a litigation in Court is available to lawyers in Papua New Guinea and therefore the plaintiff is precluded from bringing this action against Maladinas?

(2) Whether this is an appropriate case for a summary dismissal of the action against the defendants?

Facts

The facts giving rise to this issue goes back to the 1997 Papua New Guinea National Elections. The plaintiff contested in that election and he won the Wabag Open Seat. A petition under the Organic Law on the National and Local-level Government Elections ("the Organic Law") was filed by his runner-up disputing his election. One of the matters raised in the petition was the right of the plaintiff to be nominated and stand for the Wabag Open Electorate. The claim was that, he was not properly qualified under the Constitution, as he was not enrolled as a voter in that electorate. At the hearing, the Court of disputed returns ("the Court") found that the plaintiff was on the Common Roll for the Wabag Open Seat and was therefore, entitled to nominate for Parliament. The Court then dismissed the petition.

The Supreme Court on the application of the losing candidate, Mr. Daniel Kapi, reviewed the National Court decision. The Supreme Court declared the plaintiff’s victory was improper and in the circumstances ordered that a by-election be held for the Wabag Open Electorate. The plaintiff lost in the by-election.

In his statement of claim, the plaintiff alleges that the defendants were negligent in the conduct of his case in relation to the petition in the National Court. Specifically, the plaintiff alleges in the Statement of Claim that Maladinas particularly, Mr. Gregory James Sheppard failed to heed the plaintiff’s relevant instructions and act according to or give effect to those instructions. He claims also that, Mr. Shepherd failed in his duty in that, Mr. Shepherd made no attempt to lead the necessary evidence showing that the plaintiff’s name (as instructed by the plaintiff) is and was at all material times on the Wabag Open Electorate’s Common Roll. He further claims that, that resulted in his loosing his Wabag Open Seat and has suffered other damages consequential on his loss.

These proceedings were issued on 31st May 2001. The matter has progressed past discovery and it seems the matter is ready to progress to trial. Before that however, Maladinas have filed the motion seeking to dismiss the proceedings on 27th August 2002, which was the subject of a number of adjournments until it finally came before me on 6th December 2002.

Law on Immunity

There is no argument that, a barrister is immune from negligence suits at common law. The lawyers have referred to a number of English cases namely Rondel vs. Worsley [1969] 1 C 191 and Saif Ali vs. Sydney Mitchell and Co. [1980] AC 198 and a judgement of the Court of Appeal in New Zealand namely Rees vs. Sinclair [1974] 1 NZLR 180. There is also no argument that, these cases correctly represent the law on the immunity available to barristers. Accordingly, there is no issue on the basis or the justification for such immunity. To use the words of the court in the Saif Ali vs. Sydney Mitchell and Co. (supra) case, that immunity is based on public policy considerations. As Mr. Sheppard submits at page 6 of his written submissions, the public policy grounds upon which the court relied on can be summarised as follows:

1. The administration of justice requires that a barrister should be able to carry out his duty to the court fearlessly and independently. This duty may be affected if he owes a conflicting duty to his client;
2. Actions for negligence against advocates would involve retrying the original actions. This would prolong litigation and create the risk of inconsistent decisions, which would bring the administration of justice into disrepute;
3. Because of the ‘cab-rank’ rule, a barrister was obliged to accept any client, however difficult, who sought his services. It would encourage breaches of this rule if advocates did not have immunity; and
4. A barrister’s immunity for what he says and does in court is part of a general immunity, which attaches to all persons participating in court proceedings: judges, court officials, witnesses, parties and solicitors.
   

It is submitted for Maladinas that, in the absence of any decisions of the Courts in Papua New Guinea directly on the issue of immunity for lawyers, this Court is bound to follow the English court decisions. They submit that the House of Lords decision in the Rondel vs. Worsely (supra) case is binding upon this Court and the Court is bound to strike out the plaintiff’s writ of summons or statement of claim solely on this ground.

In addition to the policy considerations for the availability of immunity to barristers at common law, there is an important feature in the profession of a barrister. A barrister may not deal with clients accept through a solicitor. So a barrister has no opportunity to hear directly from the client as to his instructions but to act only on his brief from the instructing solicitor. Immediately therefore, it would appear that, where there is a single system such as ours, the immunity may lose its justification because a lawyer can be both a solicitor and a barrister in terms of the kind of work that he has to do. He deals directly with is client. It would thus, really matter what instructions a client gives to his lawyer.

In Papua New Guinea, a lawyer is both a solicitor and a barrister depending on what he does. There is no formal separation between the two. This is why both the Supreme and National Courts have been quick to suggest actions against lawyers for professional negligence where the facts or the circumstances of a case disclose such conduct on the part of lawyers.

My brother Justice Salika in Kia Temai vs. Motor Vehicles Insurance (PNG) Trust N1442 said in the last page of his judgement:

"In my view lawyers who fail to properly prepare their client’s cases are being plain negligent in their duties and in my view are loosing the cases for their clients, cases they otherwise might have won had they being properly prepared and being diligent. In my view in such cases, the client should be encouraged to sue the lawyers, for damages for professional negligence."

In Martha Limitopa vs. The Independent State of Papua New Guinea and Anor [1988-89] PNGLR 364, the National Court awarded damages to the plaintiffs on account of the negligence of lawyers employed in the Public Solicitor’s office. The lawyers in that case, failed to give notice of their client’s intention to make a claim against the Motor Vehicles Insurance Trust. That judgement was by Brunton AJ, as he then was.

My brother Justice Injia in ABC Co. Transport Pty Ltd vs. Timothy Sakaip (Supra) after having found a possible case of negligence on the part of the lawyer having carriage of the matter on behalf of the parties said:

"I am of the view that Mr. Peri may have been negligent in the conduct of his client’s case on 15th November 1996. His client has a right to sue him for professional negligence. His negligent conduct in allowing his client to suffer the judgement or order cannot be a good basis for an application to set aside the judgement or order of the court."

Going by similar reasoning, both the Supreme and the National Courts have consistently declined to set aside default judgements entered against defendants on account of the negligence of a lawyer in failing to file and serve their client’s notices of intention to defend or defences within time. An example of this is the case of Motor Vehicles Insurance Ltd vs. Martha Kuma SC650.

Much earlier on, the Supreme Court per Kaputin J expressed a similar view in Busina Tabe vs. The State [1983] PNGLR 10, in these terms:

"I hesitate to take the view that incompetence of counsel can be advanced as a ground for allowing new material which was known to exists at the trial to be admitted. It is a very serious matter as far as the legal professional is concerned. It affects the credibility of counsel and may lead to allegations of professional misconduct, and naturally, will have to be proved as a fact ... and the accused in this case may very well sue the defence counsel for professional negligence."

A more recent expression of a similar statement is by the Supreme Court by majority of two to one in Benard Juali vs. The State SC667 (Unreported Judgement delivered 30/08/01) where the majority (per Sevua and Kandakasi JJ.) said at page 10:

"Finally there is ample authority for the proposition, that a lawyer’s negligence or failure to take the appropriate steps in any proceedings, does not form any good basis to excuse the need to comply with any rule or requirement in any proceedings before the court. Proceeding on that basis, claims have been successfully lodged against negligent lawyers as in Martha Limitopa vs. The State & Anor [1988-89] PNGLR 364.’

On my own part, I have expressed similar views in a number of judgements. An example of that is the judgement in The State vs. Rabaul Shipping Ltd & Rita Rurul (Unreported judgement delivered 08/12/00) N2022 where I said:

"These are clear indications of professional negligence on the apart of the respondent’s lawyers for which their client could have recourse as oppose to the applicant who has to simply wait endlessly and be kept out of the benefits of the fruits of the judgement in her favour."

The import of all these authorities should be very clear. A good number of the judges both in their capacity as Supreme and National Court judges have expressed views in favour of a client of a lawyer having a right to sue their lawyers for the lawyers professional negligence. There is no view to the contrary that favours immunity or no action against negligent lawyers. I am of the firm view therefore that, the judges and the Courts have been able to say this given the nature of the legal practice in the country where there is no distinction between a barrister and a solicitor. Also, most people in the country are illiterate. Their level of knowledge and understanding of the law is very limited except for lawyers. This is even the case for some well to do Papua New Guineans but not trained in the law. There is hence, a case of total dependence on lawyers for proper legal advice and representation of their client’s interest in the Courts or in any transaction that involves a lawyer. A lawyer is always under a duty to conduct his client’s case to the best of his abilities based on his instructions and anything falling short of that would amount to professional negligence. That may form the foundation for a former client to sue his lawyer for professional negligence. This is why it is a requirement before the issuance of practice certificates to lawyers in the country for them to first have insurance covers in place to cover for any possible case of professional negligence.

Decision on Immunity

In these circumstances, I do not consider the kind of immunity that is available to barristers in jurisdictions outside Papua New Guinea based on the common law is appropriate to the circumstances of Papua New Guinea. As noted, the immunity exists at common law because in most instances a barrister does not come to deal with the client direct but through a solicitor. The barrister only comes to act on a matter upon receipt of a brief from a solicitor. He communicates with a solicitor for any further instructions if need be for the proper conduct of the case on behalf of a litigant. He has no choice but to accept a brief based on the "cab-rank" rule. We do not have that situation in Papua New Guinea where the professional is a fused one. Also, a lawyer in the country has the right and or power to decide whom to act for and on what terms except for the Public Solicitors and the Public Prosecutors in criminal cases. A lawyer carries out the powers and functions of a solicitor as well as a barrister. A lawyer receives his client’s instructions and issues proceedings and argues his or her client’s case in Court.

Going on those premises, I now proceed to comment on the public policy grounds relied on in the Saif Ali vs. Sydney Mitchell & Co. (supra) and emphasised in Mr. Sheppard’s submissions. Firstly, a lawyer in Papua New Guinea has a duty both to his client who he deals with directly and the Court. That is to be contrasted with a barrister in jurisdictions elsewhere where the duty is owed to the Court fearlessly and independently. For any breach of his duty to the Court, a lawyer in the country may be dealt with by the Court either for contempt of Court or refer him to the Lawyers Statutory Committee. A breach of his duties to this client, he may be visited by an action for damages in negligence. Precedent has in fact already been set in the case of Martha Limitopa vs. The State & Anor (Supra).

Secondly, if a former client brings an action against his lawyer, it will not involve a retrying of the original action. Instead, it will concentrate on what the lawyer was required to do and what he did in order to determine whether or not he failed in his duty to his client. There would be two different results, one on the original claim by the plaintiff as against a third party or parties and another on his claim against his lawyer for professional negligence. There would therefore, be no case of inconsistency in decisions and thus would not give rise to the risk of bringing the administration of justice into disrepute.

Thirdly, unlike a barrister, there is no "cab-rank" rule when it comes to accepting or rejecting instructions from a client in Papua New Guinea. As already noted, a lawyer always has the right to decide whom to act for and on what terms. If he decides to accept instructions from a client, then he holds out to that client that, he has the necessary expertise, skills and time to attend to his case and he will do that to the best of his abilities. If he fails in his duties, the client will have a right of action against him for professional negligence.

Finally, the immunity applying in favour of a barrister as to what he says and does in court at common law, which applies to other participants in the court including judges is a necessary immunity in a system where the profession is divided. That goes along with the very nature of the profession of a lawyer as a barrister. Since he has no direct contact in dealing with the litigant and that he only has to deal with the instructions or act in accordance with the instructions which might have to give way to this duty to the Court, it is necessary for such immunity. However, where a lawyer has a duty both to this client and the court, it will be unreasonable to and most unfair for a lawyer to benefit from such immunity for any negligent conduct on his part at the expense of his client. As has been noted in the various judgements cited above, a client should be entitled to sue his lawyer for any professional negligence. I cannot see how that would bring into disrepute the whole administration of justice if the immunity were allowed to continue to condone negligent conducts or even unprofessional conducts on the part of lawyers. The only good, if any, might follow from such immunity would only be for the lawyers concerned and not to his client or the nation. The threat of court action for any professional negligence could make lawyers to carry out their duties to their client and to the court with due diligence, care and attention.

In my short experience at the bench, I have witnessed more cases, of unprepared lawyers and lawyers clearly failing in their duty to their client and even the Court then lawyers who are better prepared and ready and willing to assist the Court and do their best for their clients. The cases that have been cited in this judgement are testimonies to that fact or the amount of professional negligence that exists and are coming to the attention of the Courts. Given this and the earlier observation that there is not many people knowledgeable in law which necessitates a total dependence upon their lawyers to represent their interests, it would be inappropriate for us to adopt the immunity that is available at common law to the situation in Papua New Guinea.

In the end result, I find that the plaintiff is entitled to bring this claim alleging negligence against Maladinas as has been the intimation from both the Supreme and the National Court in the various occasions in the past, evidenced by the cases cited here. Consequently, I find that I can not dismiss the plaintiff’s action based on the immunity principle.

This leaves me to consider the remaining issue of frivolity.

Frivolity

It is settled law that the Court can exercise the discretionary powers vested in it under O.12 r. 40 only in the clearest of cases and the powers should be used in exceptional circumstances. The cases Mr. Sheppard cites namely Mt. Hagen Airport Hotel Pty Ltd vs. Gibbs [1996] PNGLR 216, PNG Forest Products Pty Ltd & Anor vs. The State & Anor [1992] PNGLR 85 and Runie Wabia vs. BP Exploration Operation Co. Ltd & Ors.(1998) N1697 support that proposition.

In so far as this issue is concerned in this case, it requires an examination of what the National Court and the Supreme Courts have said in their judgements as to the points of concern in this case. As Kaputin J said in Busina Tabe v. The State (supra) counsel at the trial may have to seek to defend himself. Indeed a defence as been filed denying the plaintiff’s claims. It would be wrong for me to decide this issue summarily without hearing the parties and their witnesses on the issue. It is necessary for the Court to inquire into what were the plaintiff’s instructions to the lawyers, the lawyer’s knowledge of the relevant law and how and why he approached the trial in the way he did. These are necessary to determine whether the lawyer carried out his client’s instructions competently to the best of his professional skills and ability.

In all of the circumstances, I do not find that the plaintiff’s claim is frivolous and vexatious. Instead I find that his claim is based on the alleged negligence of his lawyers in the conduct of a trial on his behalf having regard to specific instructions he gave in relation to certain aspects of his case. Whether, the plaintiff will succeed on that is matter for evidence and a decision on that after a proper trial, which includes a cross-examination of witness. I am therefore disinclined to dismiss the plaintiffs claim even on the alternative argument.

For this reasons I dismiss the lawyers’ application with costs of the application falling against the defendants. Such costs shall be agreed within 7 days if not taxed.
___________________________________________________________________________
Lawyers for the Defendants/Applicants: Maladinas Lawyers.
Lawyers for the Plaintiff/Respondent: Kamaken Lawyers.