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Sakai v Ama Akoaya Business Group Inc [2021] PGNC 343; N9192 (21 September 2021)

N9192


PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]


WS NO. 160 OF 2020


BETWEEN
ESTHER SAKAI as Customary Beneficiary of the Late SAKAI PUWO KOIPIYO
Plaintiff


AND:
AMA AKOAYA BUSINESS GROUP INC
First Defendant


AND:
JONATHAN TAMAWETO in his personal capacity and in his capacity as CHAIRMAN OF AMA AKOAYA BUSINESS GROUP INC.
Second Defendant


Lae: Dowa J
2021: 10th & 21st September

PRACTICE AND PROCEDURE – application by defendant to dismiss proceedings – grounds of - Plaintiff’s proceedings has no reasonable cause of action, cannot be sustained, or even allowed to proceed to trial - whether the pleadings fail to disclose a reasonable cause of action - whether proceedings are so frivolous or vexations, that it is untenable – consideration of – plaintiffs proceedings cannot be sustained, plaintiffs have no reasonable cause of action – proceedings dismissed

WILLS PROBATE AND ADMINISTRATION – Need for evidence of certification or grant of Letters of Administration – Personal representative deceased – requirements under sections 35 E, 39 and 44 of the Wills, Probate and Administration Act section 15 of the Public Curators Act.
Cases Cited:


PNG Forest Products vs. State [1992] PNGLR 85
Ronny Wabia vs. BP Exploration Co. Ltd [1998] PNGLR 8
Wabia vs. BP Petroleum (2019) N4337
Mt. Hagen Urban LLG vs. Sek No. 15 (2009) SC1007
National Provident Fund vs. Maladina & Others (2003) N2486
Wambunawa Holdings Ltd. vs. ANZ Bank (2020) N8310
In re Estate of Darius Tali (2011) N4281


Counsel:


J. Aku, for the Plaintiff
No Appearance for the Defendants

DECISION


21st September, 2021


  1. DOWA J: This is a ruling on an application by the Defendants to dismiss the proceedings for various reasons set out in the Notice of Motion filed 12th August 2021.
  2. By Notice of Motion, the Defendants applies for the following orders:
    1. An order to set aside service of the Writ of Summons pursuant to Order 7 Rule 7(2)(a) & (b) of the National Court Rules.
    2. An order to set aside originating process pursuant to Order 7 Rule 8 (a)(b) & (c) of the National Court Rules; alternatively
    3. An order for dismissal of proceeding pursuant to Order 12 Rule 40(1)(a) & (b) of the National Court Rules.
    4. Cost of this application.
    5. Such further or other orders that the Court considers appropriate.
  3. The Defendant relies on the affidavit of Jonathan Tama Weto filed in support of the application.
  4. The application was served on the Plaintiff, but the Plaintiff made no appearance to defend the application.

Background Facts


  1. The Plaintiff alleges, she is the biological daughter of late Sakai Puwo Koipiyo. The Plaintiff alleges her late father was a shareholder in Ama Akoya Business Group, the First Defendant. The Plaintiff alleges amongst other things, that the Defendants failed to pay dividends to their family since 2012. She alleges the Defendants failed to give an account, or report on the financial affairs to her and other members. She therefore claims an account to be given as well as dividends and proceeds of an unauthorized sale of its shares to Mainland Holdings Ltd in 2018.
  2. In the application, the Defendants allege they have not been properly served the copies of the Writ of Summons. Secondly, the Defendants allege, the Plaintiff has no standing to institute these proceedings.


Issues


  1. The issues for consideration are:
    1. Whether the Writ of Summons can be set aside on the grounds that the Defendants have not been properly served.
    2. Whether the Plaintiff has legal standing to institute these proceedings.
  1. Whether the Writ of Summons can be set aside due to lack of service on the Defendants
  1. The Defendants submit that the service of Writ of Summons on one Hockin Jacob on behalf of the Defendants is irregular. Hockin Jacob is not an authorized representative of the Defendants to receive court process. They submit the purported service of the Writ of Summons be set aside under Order 7 Rule 7(2)(a) & (b) for being irregular. Secondly, the Defendants submit that the entire Writ of Summons be set aside under Order 7 Rule 8 of the National Court Rules.
  2. In my view, the application is premature. I note from the Court file, the Plaintiff has not filed any affidavit of service. The fact of service is yet to be established to determine this issue. Secondly, the Writ of Summons was filed on 10th May 2021. The endorsement on the Writ shows a lifespan of two (2) years for the service of the Writ of Summons. The two years have not lapsed. In the circumstances, the originating summons cannot be set aside because it has been irregularly served.
    1. Whether the Plaintiff has legal capacity to sue
  3. The second leg of the Plaintiff’s application is under Order 12 Rule 40 (1) of the National Court Rules. The Defendants say the Plaintiff’s proceedings be dismissed because it does not disclose a cause of action, it is frivolous and vexatious.
  4. The law on Order 12 Rule 40 of the National Court Rules is well settled in the Supreme Court in Mt Hagen Urban Local Level Government v Sek No.15 SC 1007 at paragraphs 27-30:

“27. The terms “vexatious”, “frivolous”, “abuse of the process of the court” and “reasonable cause of action” under O.12 r.40 of the National Court Rules have been judicially considered, defined and expounded in a number of decisions in both the National and Supreme Courts. These cases include Ronny Wabia v. BP Exploration Co. Limited & 2 Others [1998] PNGLR 8 (N1697); PNG Forest Products Pty Ltd and Another v. The State and Genia [1992] PNGLR 85; Gabriel Apio Irafawe v. Yauwe Riyong (1996) N1915; Eliakim Laki and 167 Otheres v. Maurice Alulaku and Others (2002) N2001; Kiee Toap v. The Independent State of Papua New Guinea & Another (2004) N2766; Kerry Lerro trading as Hulu Hara Investments Limited v. Phillip Stagg, Valentine Kambori & The State (2006) N3050; Phillip Takori & Others v. Simon Yagari & 2 Others (2008) SC 905. These cases say the same thing.


  1. The law with regard to an application for dismissal of proceedings based on O.12 R.40 is settled in our jurisdiction. We note that the principles are succinctly set out in Kerry Lerro’s case (supra) and which has more recently been approved and applied by the Supreme Court in Phillip Takori’s case (supra).
  2. The phrase ‘disclosing a reasonable cause of action’ consists of two parts: cause of action and form of action. A cause of action is defined as a legal right or form of action known to law whereby a plaintiff in a statement of claim must plead all necessary facts and legal elements or ingredients to establish or prove his claim. The principles stated by these cases can be summarized as follows:
  3. In an application under O.12 R.40 of the NCR, the Court may dismiss a proceeding or action where it is satisfied that the pleading in the statement of claim is seriously wanting where a necessary fact or legal element has not been pleaded.”

12. However, the Court cannot readily dismiss a case on poor pleading or for lack of disclosing a reasonable cause of action unless it is shown that the case is clearly frivolous or vexatious or an abuse of the process and that it is unlikely to succeed even if it proceeds to trial. Refer: PNG Forest Products vs. State (1992) PNGLR 84–85, Ronny Wabia vs. BP Exploration Co. Ltd (1998) PNGLR 8, Wabia vs. BP Petroleum (2019)) N4337, Mt. Hagen Urban LLG vs. Sek No. 15 (2009) SC1007, National Provident Fund vs. Maladina & Others (2003) N2486; and Wambunawa Holdings Ltd. vs. ANZ Bank (2020) N8310.


13. In Wambunawa Holdings (supra), I restated this position at paragraphs 15 and 16 of my judgment:


“15. In the case, PNG Forest Products vs. State (1992) PNGLR 84-85 the Court adopting some English Court phrases stated that a court be slow and cautious in entertaining applications for dismissal of proceedings on the grounds of a party disclosing no reasonable cause of action. A Plaintiff should not be driven from the judgment seat unless the case is “unarguable” or the cause of action is “obviously and almost incontestably bad, or plainly untenable. In that case, the Court also said the Court has a discretionary power to dismiss if the proceedings are an abuse of the Court process.”


“16. On the other hand, there are other string of cases that developed the principle that, where the case is vexatious or frivolous and that it is unlikely to succeed, the case can be summarily determined. Ronny Wabia vs. BP Exploration Co. Ltd (1998) PNGLR 8, and Wabia vs. BP Petroleum (2009) N4337 and National Provident Fund Board vs. Maladina & Others (2003) N2486.”


14. I will apply these principles in the present case.


  1. The main argument advanced by the defendants is this. The Defendants allege that the Plaintiff does not have legal standing to institute these proceedings. The Defendants say the Plaintiff is not a shareholder or a recognized next of kin of a shareholder according to their records. The Defendants allege, that Sakai is the next of kin of the one Puwo Koipiyo. After the passing of Sakai, no other persons have been named as next of kin of Puwo Koipiyo.

  1. The Plaintiff did not attend court to defend the application and provide a response. The Plaintiff was served a copy of Notice of Motion, affidavits and cover letter dated 31st August 2021. The Plaintiff was advised twice about the application, but she chose not to attend court on 20th August 2021, and again on 3rd September 2021.Had the Plaintiff attended Court, she would have provided a response and enlightened the Court on the issues raised. I am satisfied that due notice was given to the Plaintiff and so I will proceed to rule on the application.
  2. In determining this issue, I refer to Sections 35 E, 39 and 44 of the Wills, Probate and Administration Act which I consider relevant and applicable. Sections 35 E, 39 and 44 read and I quote:

“35E. CERTIFICATION OF PERSONS ENTITLED TO ESTATE.

(1) The persons entitled to the estate of a person who dies intestate are the persons certified under Subsection (2) as being so entitled.

(2) A District Officer or other person who, in the opinion of the Public Curator is competent to certify customary entitlements where a person dies intestate, shall certify the persons entitled to the estate of that deceased person.

  1. GRANT ON EVIDENCE OR PRESUMPTION OF DEATH.

(1) Where the National Court is satisfied, whether by direct evidence or on presumption of death, that a person has died leaving property in the country, the Court has jurisdiction to grant probate of his will or administration of his estate as if he were a deceased person, notwithstanding that after the grant it may appear that he was living at the date of the grant.

(2) Subject to this Act, where a grant is or has been made of probate of the will or administration of the estate of a person who the National Court is satisfied is dead, notwithstanding that it subsequently appears that the person was living at the date of the grant the person administering the estate by virtue of the grant has the same rights, powers, privileges, duties and liabilities as the personal representative of a deceased person, and in any Act the expression “personal representative” includes the person administering the estate for the time being by virtue of the grant.

  1. INITIAL VESTING IN PUBLIC CURATOR.

Until probate or administration is granted, the property of a deceased person vests in the Public Curator, in the same manner and to the same extent as formerly personal estate in England vested in the Ordinary.”

  1. In the present case, the Plaintiff pleads she is the daughter of one Sakai Puwo Koipiyo, deceased. She says, Late Sakai Puwo Koipiyo is a shareholder in the First Defendant business group. She pleads she is instituting these proceedings as a customary representative of the deceased estate. However, the pleadings do not show that the Plaintiff is a certified representative of the estate of late Sakai Puwo Koipiyo, in accordance with Section 35 E of the Wills, Probate and Administration Act. The pleadings do not show that the Plaintiff has been granted Probate or Letters of Administration of the estate of late Sakai Puwo Koipiyo under Section 39 of the Will, Probate and Administration Act. Finally, until such time when probate or letters of Administration is granted to the Plaintiff, the proprietary interest of the late deceased, Sakai Puwo Koipiyo vests in the Public Curator of Papua New Guinea pursuant to Section 44 of the Wills, Probate and Administration Act, and under Sections 15 of the Public Curators Act.
  2. In re Estate of Darius Tali (2011) N42811, Dawani J (as she then was) in discussing the application of Section 44 of the Wills, Probate and Administration Act, said this at paragraph 23 of the Judgement:
    1. “Section 44 of the WPA states that until grant of probate or Letters of Administration, the property of a deceased person vests in the Public Curator. The Public Curator may not administer the deceased's estate unless he is granted representation rights. The deceased's property vests for the purpose of administration in the person appointed by the National Court to have representation rights (Probate or Letters of Administration) (s.45(2)). If representation rights (Probate or Letters of Administration) are granted to a person other than the Public Curator, all of the property of the estate transfers from the Public Curator to that person.”
  3. In the present case, the pleadings do not disclose any legal rights of representation is given to the Plaintiff to institute these proceedings to protect the interest and rights of the deceased estate. Unless and until the Plaintiff is granted representative rights, she lacks capacity to institute and maintain these proceedings.
  4. Under Order 12 Rule 40(1)(a) & (b) of the National Court Rules, the Court has a discretion to dismiss the proceedings where it appears there is no reasonable cause of action is disclosed, or the proceedings are frivolous or vexatious or the proceedings are an abuse of the process of the Court.
  5. It is clear, on the strength of the current pleadings, the proceedings do not disclose any cause of action. The Plaintiff lacks capacity to sue. The proceedings are therefore frivolous and are bound to fail even if it is allowed to proceed to trial.

What Orders should the Court make


  1. The Defendant has raised a technical issue of legal capacity and representation. I note, that if the Plaintiff is given the legal rights by way of a grant of Probate or Letters of Administration, she will be empowered to reinstitute these proceeding. Whilst I do not wish to preempt what the Plaintiff will do, it suffices to say, she should not be completely shut out in fighting for her rights some day in the future. In saying this, and in the interest of justice, I will not dismiss the proceedings. I will only strike out the proceedings on the grounds of lack of capacity to represent a deceased estate.

Cost


  1. The Defendants have been successful in this application, and thus are entitled to cost.

ORDER


25. This court orders:


  1. The Plaintiff’s proceedings are struck out for lack of legal and representative capacity.
  2. The Plaintiff shall pay the Defendants’ cost to be taxed, if not agreed.
  3. Time be abridged.

Esther Sakai: In Person for the Plaintiff
Don Wapu Lawyers: Lawyers for the Defendants

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