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Bakita PNG Ltd (trading as Sea Side Lodge Wewak) v Wobar [2018] PGNC 443; N7546 (21 September 2018)

N7546

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]


W.S No. 637 of 2017


BETWEEN
BAKITA PNG LIMITED trading as SEA SIDE LODGE WEWAK
Plaintiff


AND
RICHARD WOBAR in his capacity as the WEWAK DISTRICT ADMINISTRATOR, INSPECTOR BAUGEN in his capacity as Wewak Police Station Commander, WEWAK LOCAL LEVEL GOVERNMENT and THE STATE DEFENDANTS


Wewak: Gora, AJ
2018: 12th and 21st September


PRACTICE & PROCEDURE – Application for Default Judgment – Requirements under Order 4, Rule 19 (3) & (4) of National Court Rules – Application of checklist of six pre-conditions


PRACTICE & PROCEDURE – Exercise of discretion – Wide range of considerations to be taken into account – Whether pleadings disclose reasonable cause of action – Interest of Justice – Public policy and other considerations


Cases Cited


Giru v Muta (2005) N2877
Kaluni v Warole (2001) N2114.
Kitipa v Auali & Os (1998) N1773
Kunton & Ors v Junias & Ors (2006) SC929
Mapmakers v BHP (1987) PNGLR 78
Paraka & Os v Kawa & The State [2000) N1987


Counsel:


Brian Coomer, for Plaintiff
Enoch Manihambu , for Defendants


DECISION ON APPLICATION FOR DEFAULT JUDGEMENT


21st September, 2018


  1. GORA AJ: INTRODUCTION: This is an application by way of Notice of Motion by the plaintiff for a default judgment to be entered against the defendants. The application is made pursuant to Order 12 Rule 32 and/or Rule 25 of the National Court Rules.
  2. The applicant/plaintiff is seeking default judgment on the basis that the defendants have failed to file their Notice of Intention to Defend and their Defense respectively for liquidated amount in the sum of K231,0000.00 in accordance with Order 7, Rules (1)-(7) and Order 8, Rule 4 (1) (a) of the National Court Rules.

BACKGROUND


  1. From court documents it appears that on or about 17th January 2015 and various dates thereafter, the plaintiff and the First & Second defendants entered into a verbal agreement for the arrangement and/or provision of rooms for Ten (10) police personnel who were to be flown in from Port Moresby to be attached with the Wewak District, as District police personnel.
  2. Based on the purported agreement, the plaintiff made reservations and provided six (6) rooms for the accommodation of the Ten (10) police personnel as requested by the First and Second defendants on the 18th January 2015, and thereafter raised and/or issued invoices for the same amounting to 231,000.00.
  3. At all materials times the Plaintiff demanded the First, Second & Third defendants to arrange for payment of the cost of provision of accommodation to the Ten (10) police personnel pursuant to the Agreement. However the First, Second & Third defendants drastically failed, refused or neglected to settle the same.
  4. On the 7th of July 2015, the plaintiff requested the Ten (10) police personnel to vacate the lodge due to the First, Second & Third defendants’ failure in settling the outstanding invoice in the sum of K231, 000.00.
  5. The plaintiff then thereafter commenced these proceedings under a Writ of Summons referenced as W.S 637 of 2017 which was filed on the 6th July 2017 claiming against the defendants a liquidated sum of K231, 000.00.
  6. The Writ of Summons was served on the defendants for which details are as follows:
    1. First, Third & Fourth Defendants were served on the 18th September 2017 at 12:48pm
    2. Second Defendant was served on the 20th of September 2017 at 9:10am
    1. Fifth Defendant was served on the 13th of July 2017 1:50pm,
  7. Since service of the Writ of Summons Defendants have failed to file their Notice of Intention to Defend and Defense up to this date.

ISSUE

  1. Whether the plaintiff is entitled to a Default Judgment.

THE LAW

  1. Order 12 Rule 25 (b) of the National Court Rules clearly stated that:

“A defendant shall be in default where he is required to file a defense and the time for him to file a defense has expired but he has not filed his defense.”

  1. Then Order 12, Rule 26 (a) states that:

“Where defendant is in default, the plaintiff may take the steps mentioned in Rules 27 to 33 according to the nature of his claim for relief against the defendant in default.”

  1. In the present case the plaintiff has filed a Notice of Motion to enter judgment by default against the First, Second &Third defendants for failing to file their Notice of Intention to Defend and Defense.

APPLICATION OF THE LAW

  1. The general principles of practice and procedure relating to default judgment are that the plaintiff seeking judgment by default must make application to the court and such application must include a Proof of Service of the origination process and an affidavit on behalf of the plaintiff proving the default.
  2. Order 4 Rule 19 (3) (a) (i) of National Court Rules specifically make provisions for those requirements. It provides that: “ an applicant for default judgment shall file the following documents:
  3. The procedures arising from these rules and other previous Practice Directions have been discussed and outlined in such cases as Mapmakers v BHP (1987) PNGLR 78; Paraka & Os v Kawa &The State [2000) N1987 and Kaluni v Warole (2001) N2114.
  4. Furthermore in the case of Giru v Muta (2005) N2877, the court in giving effect to these rules of practice and procedure outlined them as checklist of 6 preconditions to an application for Default Judgment.

These checklists are summarized as follow:


(a) Proper form
(b) Service of Notion of Motion and Affidavits
(c) Default
(d) Warning
(e) Proof of Service of Writ
(f) Proof of Default
  1. However a warning has been issued in the case of Kitipa v Auali & Os (1998) N1773 that a default judgment may still not be entered even where proof of due service of the Writ has been given or where effect of the default judgment would prejudice the rights of other co-defendants, or that the pleadings are so vague or do not disclose a reasonable cause of action or that the default judgment cannot be sustained in Law.
  2. I also note that the Supreme Court in the case of Kunton & Ors v Junias & Ors (2006) SC929 found that there were a wide and not closed range of considerations which should be taken into account including:

FINDINGS

  1. Taking all these into account, the question is whether the plaintiff has satisfied all the requirements to enable the court to exercise its discretion to enter judgment by default. I will adopt the checklist of 6 pre-conditions pronounced in Giru v Muta (supra) to determine this issue.
    1. PROPER FORM: - Plaintiff filed his Notice of Motion seeking orders for judgment to be entered by default on the 06th of February 2018. This is consistent with Order 12, Rule 19 (3) (a) (i) of the National Court Rules. I tick this as Okay.
    2. SERVICE OF NOTICE OF MOTION AND AFFIDAVITS: - Plaintiff filed his affidavit in support of the Notice of Motion on the 06th February 2018. He filed his Affidavit of Service of the said Notice of Motion and Affidavit in Support on the 22nd of February 2018. This is also consistent with Order 12, Rule 19 (3) (a) (i) of the National Court Rules. I tick this as Okay.
    3. DEFAULT: - Defendants have failed to file a Notice of Intention to defend within 30 days after service of the Writ of Summons as specifically stated in the Writ of Summons and in accordance with Order 12, Rule 25 of the National Court Rules. Defendants then further failed to file their Defense as required by the Rules. Plaintiff has therefore shown default by the defendants. I tick this as okay.
    4. WARNING: - There were several warning letters sent to the defendants. First on the 9th of November 2017 plaintiffs lawyers sent a letter to the First, Third & Fourth Defendants pointing out that they have not filed their Notice of Intention to Defend by 17th October 2017 which is the required time pursuant to the National Court Rules commencing on the date of service of Writ of Summons on 20th September 2017 and that a file search conducted on 31st October 2017 confirmed that the second defendant has not filed his Notice of Intention to Defend and Defense.

Secondly on the same day 09th November 2017 the plaintiffs lawyers wrote another letter to the second defendant police Inspector Baugen in his capacity as the Police Station Commander of Wewak pointing out that he has not filed Notice of Intention to Defend by 19th October 2017 and Defense by 31st October 2017 which is the required time, pursuant to the National Court Rules, commencing on the date of service of the Writ of Summons on 20th September 2017 and that a file search conducted on 31st October 2017 confirmed that the Second Defendant has not filed his Notice of Intention to Defend and Defense.

Thirdly on the same day 9th of November 2017 the plaintiffs lawyers caused another letter to the fifth defendants lawyers, the Solicitor General, advising that the State has not filed its Notion of Intention to Defend by 12th August 2017 and its Defense by 24th August 2017 the required time pursuant to the National Court Rules commencing on the date of service of the Writ of Summons on 13th July 2017 and that a file search conducted on 31st October 2017 confirmed that the fifth defendant has not filed its Notice of Intention to Defend and Defense. A final search at the Wewak National Court Registry was conducted on the 6th of February 2018 and still there was no Notice of Intention to Defend nor Defense filed by the defendants at the date of filing of this Notice of Motion. Therefore I find that the requirement to give warning notice to the defendants has been satisfied by the applicant. I tick this as Okay.

  1. PROOF OF SERVICE OF WRIT: - An affidavit of Chris Bais dated 24th October 2017 who says that on the 18th September at 12:48pm at the Wewak District Development Authority office he personally served a sealed copy of the Writ of Summons, filed on 6th of July 2017 on the first Defendant Ricky Wabar in his capacity as the Wewak District Administrator who accepted service. A further affidavit of Chris Bais dated 24th October 2017 who says that on the 18th September 2017 at 12:50pm he personally served a sealed copy of the Writ of Summons, filed on the 6th July 2017 on the third defendant, Wewak District Development Authority on Ricky Wabar who accepted service as District Administrator. A further affidavit of Chris Bais dated 24th October 2017 who say that on the 18th of September 2017 at about 12:48pm he attended at the Wewak District Development Authority Office, East Sepik Province and personally served a sealed copy of the Writ Summons filed on 6th July 2017 on the fourth Defendant on Mr. Ricky Wabar who is the Wewak District Administrator who accepted service. And a further affidavit of Chris Bais dated 24th October 2017 who say that on the 20th September 2017 at 9:00am he attended at the Wewak Police Station PPHQ, East Sepik Province, and personally served a sealed copy of the Writ of Summons, filed on 6th July 2017 on Inspector James Baugen, the Rural Commander A/APPC of Wewak Police Station, who is the second defendant. Another affidavit of one Aila Eity dated 25th July 2017 who says that on the 13th July 2017 at about 1:50pm she attended at the office of the Solicitor General Department of Justise & Attorney General, Level 7, Sir Buri Kidu Haus, Waigani, National Capital District and served a sealed copy of the Writ of Summons, filed on 6th July 2017, by delivering and leaving it with one Mrs. Brenda Koini who is employed as Acting Senior Executive Assistant with the Department of Justice & Attorney who accepted service. I am satisfied requirement of service of the Writ of Summons on all defendants have been complied with. I tick this as Okay.
  2. PROOF OF DEFAULT: - Proof of Default is confirmed by a couple of affidavits of search conducted at the Wewak National Registry. First an Affidavit of Search conducted by Christ Bais dated 31st January 2018 says that he first conducted a search in the Wewak National Court Registry on the 31st of October 2017 search showed there was no Notice of Intention to defend nor a Defense filed by the defendants. A further affidavit of Chris Baus dated 27th February says that he conducted another search at the Wewak National Registry on the 6th February 2018 and the search showed no Notice of Intention to Defend and Defense has been filed by the defendants. These affidavits of search clearly demonstrate a significant default and failure by the defendants in filing their Notice of Intention to defend and Defense. This requirement has been satisfied. I also tick this as Okay.
  1. Given these findings I am satisfied that the plaintiff has taken all necessary steps required by Order 4 Rule 19 (3) of the rules of National Court to justify its application for a default judgment to be entered particularly against the first, second & third defendants. I am further satisfied that the pre-conditions stated in Giru v Muta case (supra) have all been complied with and therefore the plaintiff is entitled to a default judgment. I do not think that granting of a Default Judgment to the Plaintiff would prejudice the rights of other co-defendants and that the liquidated sum of K231, 000.00 is consistent with the terms of the agreement and therefore would not be against public policy unless the sum is for a substantial amount. I also note that a reasonable cause of action has been sufficiently pleaded in the Writ of Summons and injustice would be done to the Plaintiff of his application for judgment to be entered by default is not granted. Accordingly I grant the application for judgment to be entered by default in favor of the Plaintiff.
  2. I order as follows that:
    1. Pursuant to Order 12 Rule 32 and/or Rule 25 of the National Court Rules a Default Judgment be entered against the Defendants for failing to file its Notice of Intention to Defend and its Defense for liquidated amount at the sum of K231, 000.00 in accordance with Order 8 Rule 4 (1)(a) of the National Court Rules.
    2. The Defendants shall jointly and severally pay to the Plaintiff;
      • (a) Interest at the rate of 8% per annum on the judgment debt from the date of filing of the Writ of Summons to the date of payment in full of the Judgment debt pursuant to the Judicial Proceedings (Interest on Debt and Damages) Act Chapter 52 and;
      • (b) Costs of and incidental to the application and the proceedings to be taxed if not agreed.

Rugeau Manua & Kikira : Lawyer for the Plaintiff/Applicant
Public Prosecutor’s Office: Lawyer for the Defendant


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