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Magellan Properties Ltd v Papua New Guinea Harbours Ltd [2016] PGNC 182; N6375 (23 June 2016)

N6375
PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

WS 230 OF 2004

BETWEEN:

MAGELLAN PROPERTIES LIMITED
Plaintiff

AND:

PAPUA NEW GUINEA HARBOURS LIMITED
First Defendant

AND:

INDEPENDENT STATE OF PAPUA NEW GUINEA
Second Defendant

Waigani: Hartshorn J.

2016: 7^th & 23^rd June

Application to add a plaintiff to the proceeding

Cases cited:

Coecon Ltd (Receiver and Manager Appointed) v. Westpac Bank PNG Ltd (2012) N5097
Liff v. Peasley [1980] 1 WLR 781
Mamun Investment Ltd v. Koim (2015) SC1409

PNG Power Ltd v. Augerea (2013) SC1245
Public Curator of Papua New Guinea v. Kara (2014) SC1420

Counsel:

Mr. W. Frizzell, for the Plaintiff
Mr. H. Viyogo, for the Defendants

23^rd June, 2016

1. HARTSHORN, J: This is a decision on an application to add a plaintiff to the proceeding and to further amend the statement of claim.

Background

2. The plaintiff Magellan Properties Ltd (Magellan) by virtue of its business lease and easement or right of way (Lease) operated the business of berthing, discharging and loading coastal shipping on Craig’s Wharf in Port Moresby. Magellan claims that the first defendant PNG Harbours Ltd (Harbours) in the course of constructing a wharf, caused dirt and other fill to escape onto the seabed of the Lease causing loss and damage to Magellan. Magellan’s causes of action against the defendants are in amongst others, negligence, nuisance and breach of statutory duty.

This application

3. I will consider the application to add a plaintiff to the proceeding first.

4. Magellan and Bismark Maritime Ltd (Bismark) submit that Bismark should be added as the second plaintiff to this proceeding as:

a) Magellan and Bismark are related companies, Magellan is a subsidiary of Bismark and the beneficial ownership and control of both companies is the same;

b) Bismark has claims against Harbours for losses resulting from the direct actions of Harbours since March 2004 that resulted in Bismark not being able to utilise the northern side of Craig’s Wharf for the berthing of its coastal shipping;

c) Bismark’s addition as a plaintiff is necessary to ensure that all matters in dispute in the proceedings may be effectually and completely determined and adjudicated upon and will not result in a multiplicity of proceedings;

d) the causes of action of Bismark against Harbours continue to accrue, but in any event the defendants can plead the limitation defence.

5. Harbours submits that Bismark should not be permitted to be added as a plaintiff as:

a) any cause of action that Bismark may have against it is statute barred;

b) there has been inordinate delay in making this application for joinder;

c) Bismark’s joinder is not necessary to ensure that all matters in dispute in this proceeding can be effectually and completely determined and adjudicated upon;

d) Harbours no longer owns the land that it did that is the subject of this proceeding.

Consideration

6. Application is made under Order 5 Rule 8, Order 10 Rule 9A (7) and Order 12 Rule 1 National Court Rules. Order 5 Rule 8 is the provision that deals specifically with this issue and so I shall consider the application under this Rule, (1) and (2) of which are:

“(1) Where a person who is not a party-
(a) ought to have been joined as a party; or
(b) is a person whose joinder as a party is necessary to ensure that all matters in dispute in the proceedings may be effectually and completely determined and adjudicated on,
the Court, on application by him or by any party or of its own motion, may, on terms, order that he be added as a party and make orders for the further conduct of the proceedings.

(2) A person shall not be added as plaintiff without his consent.”

7. In regard to Rule 8 (2), Bismark has not given its consent to being added as a plaintiff. As the Managing Director of Bismark has given evidence supporting the proposed addition, presumably the consent of Bismark would be forthcoming. If this court permitted the addition, such addition would be subject to Bismark providing its consent.

8. As to Rule 8 (1) (a), whether Bismark ought to have been joined, as is stated in Ritchie’s Supreme Court Procedure New South Wales 1984 at [8.8.0], the equivalent Rule applies where the party to be added ought to have been made a party in the first instance. Here, as Magellan and Bismark are related, have the same beneficial ownership and control, and the same causes of action, the question of why it has taken over 12 years for an application for Bismark to be joined, requires an explanation. No explanation is given for such delay in so applying. In my view such delay without explanation is fatal to an application under Rule 8 (1) (a).

9. As to Rule 8 (1) (b), whether Bismark’s joinder as a party is necessary to ensure that all matters in dispute in the proceedings may be effectually and completely determined and adjudicated upon, in Coecon Ltd (Receiver and Manager Appointed) v. Westpac Bank PNG Ltd (2012) N5097 I said:

“In the recent Supreme Court case of PNG Deep Sea Fishing Ltd v. Critten (2010) SC1126, Kandakasi J. and Sawong J. said:

“.... we are of the view that the most important test (sic) for joinder of parties are:

(a) whether the applicant has sufficient interest in the proceedings; and
(b) whether the applicant's joinder as a party is necessary to ensure that all matters in dispute in the proceedings can be effectively and completely adjudicated upon.

8. In considering whether a proposed party has met the above tests, it is necessary and important to have regard to the cause of action pleaded. For it is the pleadings that disclose the matters in dispute and who are the correct plaintiffs and defendants. If the pleadings disclose a cause of action against more than one person and only one of them has been named and an application is made to join the other party or parties who have not yet been named in the proceedings, that party or parties may be joined. Conversely, if a cause of action pleaded discloses or suggests that the pleaded cause of action is vested in common or jointly with another party who has not been named and an application is made to join a party, the application may be granted. Where however, the pleadings either deliberately or inadvertently omit to plead all of the relevant facts or there is a lack thereof, there must be a close examination of the facts and or the basis on which the application for joinder is made.”

I was a member of the Court in PNG Deep Sea Fishing (supra) and agreed with their Honours’ reasoning and conclusions concerning the appeal against the refusal to add parties.

10. In Kara v. Public Curator of Papua New Guinea (2010) N4048, after referring to the tests that are listed a) and b) in PNG Deep Sea Fishing (supra), I stated that:

“25. In considering whether a proposed party has a sufficient interest in the proceeding or whether his joinder is necessary to ensure that all matters in dispute in the proceeding can be effectually and completely adjudicated upon, certain factors warrant consideration.

26. These include whether:

a) any relief is sought against the proposed party,

b) the plaintiff opposes the application for joinder,

c) the proposed party will be affected if the relief sought in the statement of claim is granted,

d) the joinder of the proposed party is necessary to satisfy any orders made in the proceeding.”

10. Coecon v. Westpac (supra), PNG Deep Sea v. Critten (supra) and Kara v. Public Curator (supra) were all concerned with the proposed joinder of defendants. This application concerns the proposed joinder of a plaintiff. When the words “ ..... to ensure that all matters in dispute in the proceedings ....” are considered in this context, I have difficulty in concluding that it is necessary to ensure that any matter in dispute in the proceeding requires Bismark’s joinder as every matter in dispute in the proceeding is as pleaded by Magellan against the defendants. There is no allegation by Bismark against any party to the proceeding and no allegation by any of the parties against Bismark.

11. Further, there is no evidence to the effect that, and it is not apparent that Bismark will be affected if the relief sought in the present statement of claim is granted and that its joinder is necessary to satisfy any orders that may be made in the proceeding as presently pleaded.

12. An additional consideration in this instance is that Harbours submits that any claim that Bismark may have against it and the other defendant are statute barred and therefore Bismark should not be permitted to be joined as a plaintiff. Magellan and Bismark submit that Bismark’s cause of action continues to accrue and Harbours would be able to plead in an amended defence that Bismark’s claim is statute barred.

13. From the evidence in support of this application, any cause of action of Bismark accrued in or about March 2004. The second defendant, the State, clearly is included in the definition of “State” in the Claims By and Against the State Act (Claims Act). Since the Supreme Court case of PNG Power Ltd v. Augerea (2013) SC1245, which has been followed by Public Curator of Papua New Guinea v. Kara (2014) SC1420, has in essence revisited what entities are to be included in the definition of “State” in the Claims Act, Papua New Guinea Harbours Ltd would now be included in the term “State”. This court is bound by these Supreme Court decisions.

14. Consequently, a s. 5 notice is required to have been given by Bismark in respect of its claims against the defendants that are in contract or in tort. Further, such a notice must have been given within a period of six months after the occurrence out of which the claim arises or, for breach of contract, within six months of Bismark becoming aware of the breach.

15. Here, notwithstanding that the relief sought by Magellan includes declaratory relief and presumably would be sought by Bismark if permitted to be added as a plaintiff, the underlying basis for the declaratory relief is not in equity but in tort. I refer to Mamun Investment Ltd v. Koim (2015) SC1409 in this regard and so a s. 5 notice would be required to have been given.

16. As there is no evidence of a s. 5 notice being given, and of being given within six months after the occurrence out of which the claim arose, in or about March 2004 according to the evidence in support of the application, and even if such a notice had been given within time, the cause of action of Bismark against the defendants based on a cause of action accruing in or about March 2004, would be statute barred pursuant to s. 16 Frauds and Limitations Act.

17. It is the case that the defendants would be able to plead the limitation defence if Bismark were permitted to be a plaintiff as Order 5 Rule 11 (3) National Court Rules provides that:

“... where a party is added pursuant to an order under Rule 8 or 10, the date of commencement of the proceedings so far as concerns him shall be the date of filing of the originating process amended so as to add him as a party or, where an amended originating process is not filed, the date of the amendment adding him as a party.”

18. As the limitation plea of the defendants in my view would be successful, it would serve no useful purpose to allow the addition of Bismark as a plaintiff. I refer to the comments of Brandon LJ in Liff v. Peasley [1980] 1 WLR 781 at 799-805 on this point.

Conclusion

19. I am not satisfied that it has been properly made out that Bismark ought to have been joined as a party, or that its joinder is necessary in terms of Order 5 Rule 8 (1) (b) National Court Rules. Further, Bismark’s joinder would serve no purpose, for the reasons given. The application to join Bismark as a plaintiff should therefore be refused. Given this it is not necessary to consider the other submissions of counsel as to joinder.

20. Further, as the joinder application has been unsuccessful the proposed amendments to the statement of claim are not required. It is not necessary therefore to consider the other submissions of counsel.

Orders

21.

a) All of the relief sought in the notice of motion of Bismark Maritime Ltd filed by the plaintiff on 3^rd May 2016 is refused;

b) The defendants’ costs of and incidental to the said notice of motion shall be paid by the plaintiff;

c) Time is abridged.

____________________________________________________________
Warner Shand Lawyers : Lawyers for the Plaintiff
PNG Ports Corporation Ltd Inhouse Lawyer: Lawyers for the Defendant