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Andoi v Modilon Hospital Board [2018] PGNC 120; N7199 (10 April 2018)

N7199

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

WS NO 895 OF 2013

BETWEEN:
PETER ANDOI TRADING AS RAI COAST ELECTRICAL SERVICES
Plaintiff

AND:
MODILON HOSPITAL BOARD
First Defendant

FATHER JAN CZUBA
Second Defendant

CHRISTINE GAWI, CEO, MODILON GENERAL HOSPITAL
Third Defendant

MODILON GENERAL HOSPITAL
Fourth Defendant

Madang: Cannings J

2017: 28 February, 21 July

2018: 10 April

DEBT – breach of contract – electrical services contract – liability established at trial – alleged failure of defendant to pay full amount of invoices rendered.

The plaintiff succeeded at an earlier trial in establishing liability in breach of contract against the first defendant for its failure to pay the full amount of invoices rendered under an electrical services contract. At the trial on assessment of debt, the amount of the debt due was claimed to be K243, 756.00. The first defendant argued that nothing should be awarded as there was no evidence that it owed anything to the plaintiff, which had secured judgment on liability by misleading the court.

Held:

(1) The general principles for assessment of debt are the same as those for assessment of damages: the plaintiff has the onus of proving his losses, it is not sufficient to rely on assertions in the statement of claim; corroboration of a claim is required; the fact that debt cannot be assessed with certainty does not necessarily relieve the wrongdoer of the necessity of paying some amount of debt.

(2) Here the plaintiff was entitled to a notional amount of debt only as: the evidence in support of the claim was scanty, unreliable and uncorroborated and the factual basis of the plaintiff’s case was altered fundamentally between the trial on liability and the trial on debt, giving rise to a reasonable suspicion that the court had been deliberately or recklessly misled at the trial on liability.

(3) The appropriate award of debt in circumstances where, though there was reasonable suspicion about the court being misled, the judgment on liability had not been set aside, was K20,000.00. No interest was awarded and the parties were ordered to bear their own costs.

Cases cited

The following cases are cited in the judgment:

Graham Mappa v ELCOM (1992) N1093
Kopung Brothers Business Group v Sakawar Kasieng [1997] PNGLR 331
Kumagai Gumi Co Ltd v National Provident Fund Board of Trustees (2006) SC837
Niugini Civil & Petroleum Ltd v West New Britain Development Corporation Ltd (2008) N3292
Yooken Paklin v The State (2001) N2212

ASSESSMENT OF DEBT

This was a trial on assessment of debt for breach of contract following a trial on liability.
Counsel:

B Tabai, for the Plaintiff
J Brooks, for the Defendants

10^th April, 2018

1. CANNINGS J: This has been a trial on assessment of debt. The plaintiff, Peter Andoi, trading as Rai Coast Electrical Services, succeeded at an earlier trial in establishing liability in breach of contract against the first defendant, Modilon Hospital Board. The proceedings against the three other defendants were dismissed.

2. The plaintiff proved at the trial on liability that he and the first defendant had entered into a contract under which the plaintiff provided electrical services to Modilon General Hospital, Madang. It was an unwritten contract under which the plaintiff would perform work as and when required and render an invoice when particular jobs were completed, and the first defendant was required to pay the amount of the invoice for the work done. In his statement of claim the plaintiff pleaded that from January to May 2012 he rendered four invoices to the total value of K263,756.75, of which only K20,000.00 was paid.

SUBMISSIONS

3. At the trial on assessment, the plaintiff’s counsel, Mr Tabai, submitted, consistently with the facts pleaded in the statement of claim, that judgment should be entered in the sum of K243,756.75. This is a claim for debt as distinct from damages. It is important to maintain that distinction (Kumagai Gumi Co Ltd v National Provident Fund Board of Trustees (2006) SC837, Niugini Civil & Petroleum Ltd v West New Britain Development Corporation Ltd (2008) N3292). There was no separate claim for damages.

4. The first defendant’s counsel, Mr Brooks, submitted that nothing should be awarded as there was no evidence that the first defendant owed anything to the plaintiff, who had secured judgment on liability by misleading the court.

GENERAL PRINCIPLES

5. The general principles for assessment of debt are the same as those for assessment of damages, some pertinent ones being:

➢ the plaintiff has the onus of proving his losses, it is not sufficient to rely on assertions in the statement of claim (Yooken Paklin v The State (2001) N2212);

➢ corroboration of a claim is required (Kopung Brothers Business Group v Sakawar Kasieng [1997] PNGLR 331);

➢ the fact that debt cannot be assessed with certainty does not necessarily relieve the wrongdoer of the necessity of paying some amount of debt (Graham Mappa v ELCOM (1992) N1093).

ASSESSMENT

6. Having regard to those principles I uphold the submission of Mr Brooks, for the first defendant, that the plaintiff is not entitled to the amount he is claiming as he has not proven his losses and there is no proper corroboration of the claim. The evidence adduced at the trial on assessment of debt has put a new complexion on this case.

7. I find, based on the evidence of Christine Gawi (CEO of the hospital) and James McClimby (consultant accountant), that in fact:

• the first defendant made six payments to the plaintiff totalling K178,458.44 in the period from September 2011 to March 2013; and
  
• there is no clear correlation between job requisitions (which is the best evidence available of electrical work done) and invoices rendered.
  

8. I find, based on the evidence of the plaintiff Mr Andoi, in particular his supplementary affidavit filed 18 November 2016, exhibit P2, that:

• the plaintiff’s case has fundamentally changed between the trial on liability and the trial on debt, in that in his supplementary affidavit he deposes that the total value of invoices rendered to the first defendant was K455,211.15 and the total amount received by him from the first defendant was K181,454.41.
  

9. I consider that the evidence in support of the plaintiff’s claim is scanty, unreliable and uncorroborated. The fact that the basis of the plaintiff’s case has been altered fundamentally between the trial on liability and the trial on debt, gives rise to a reasonable suspicion that the court was deliberately or recklessly misled at the trial on liability.

10. However, it must be considered that the judgment on liability was not, on application or appeal or review, set aside. And there is evidence that some work was done by the plaintiff. I also consider that the first defendant has contributed to the confusion by a lack of due diligence and fiscal discipline in its internal operations. I call upon the third general principle outlined above: the fact that debt cannot be assessed with certainty does not relieve the wrongdoer – in this case, the first defendant – from liability for something. I have decided to award a notional sum of K20,000.00.

CONCLUSION

11. The plaintiff will be awarded a total sum of K20,000.00, payable in 90 days. The question of whether any interest is payable on that sum is a matter of discretion, as is the question of costs of the proceedings. As there is no clear winner of the case, it is appropriate that no interest be payable on the judgment debt and that the parties bear their own costs.

ORDER

(1) The first defendant shall pay to the plaintiff total debt and damages of K20,000.00, without interest, being a total judgment sum of K20,000.00, within 90 days after the date of service of the order on the first defendant’s lawyers.

(2) Subject to any specific costs order made in the course of the proceedings, the parties shall bear their own costs of the entire proceedings.

Judgment accordingly,
_______________________________________________________________
Tabai Lawyers: Lawyers for the Plaintiff
Ashurst PNG: Lawyers for the Defendants