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Koyasi Printing Ltd v Kase [2022] PGNC 347; N9754 (27 June 2022)

N9754

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

WS NO. 858 OF 2016

BETWEEN:

KOYASI PRINTING LIMITED

Plaintiff

AND:

PASCOE KASE,

Secretary Department of Health

First Defendant

AND:

THE INDEPENDENT STATE OF PAPUA NEW GUINEA

Second Defendant

Waigani: Tamade AJ

2022: 24^th & 27 June

PRACTICE AND PROCEDURE – State’s application seeking leave to file defence out of time – considerations to take into account when deciding whether to grant application – the court is not satisfied with the State’s explanation for the delay in filing a defence or seeking leave to file a defence out of time.

PRACTICE & PROCEDURE – leave to file defence out of time – considerations – requirement to demonstrate a defence on the merits - delay of almost 3 years not adequately explained – state lawyer's affidavit not sufficient – the lawyer has no first-hand knowledge of matters as to evidence.

Cases Cited:

The following cases are cited in the judgment:

Tipaiza v Yali, Governor Madang Province [2005] PGNC 1; N2971

Nivani Limited v The Independent State of Papua New Guinea (2020) SC1945

Pena v J's Motors Ltd (2006) SC961

Counsel:

Mr Timothy. L Cooper, for the Plaintiff

Ms Pauline Yom, for the Defendants

27^th June, 2022

1. TAMADE AJ: The Plaintiff in these proceedings is claiming for an unpaid invoice in the sum of K111 969 for the provision of printing services to the National Department of Health. The agreement was entered into some time in 2007 and the agreement was subsequently extended. The Plaintiff claims that it rendered services to the Defendants and its invoices were paid promptly by the Defendants however its last invoice submitted on 25 February 2009 was not paid for despite demands for payment and therefore the Plaintiff has filed these proceedings in 2016.

2. On 28 March 2014, the Supreme Court granted an extension of time to the Plaintiff to issue a section 5 notice to the State under the Claims By and Against the State Act and thereafter these proceedings were filed.

3. Before this Court is an application by the Defendants filed on 21 September 2020 seeking leave of Court to file a Defence some six years out of time since the proceedings were filed. The Plaintiff also has an application for default judgment and or summary judgment in the alternative however the Court ruled that the application seeking leave to file a Defence out of time will be heard first and depending on the outcome, the application for default or summary judgment can be heard by the Court.

4. The Defendants, therefore, seek leave of Court to file their Defence pursuant to section 9 of the Claims By and Against the State Act 1996. Section 9 of the Claims By and Against the State Act is in the following terms:

9. FILING OF DEFENCE BY THIS STATE.

Notwithstanding anything in any other law, in any proceedings for a claim against the State, the time within which the State shall be required to file a defence or appear in response to a summons on complaint (as the case may be) shall be–

(a) in a claim commenced by writ in the National Court–

(i) where the statement of claim is endorsed on the writ–before the
expiry of 60 days after the date of expiry of the time-limited for
it to give notice of intention to defend; or
(ii) where the statement of claim is not endorsed on the writ–before
the expiry of 60 days from the date of service of the statement of
claim; or

(b) where a cross-claim is made against the State–before the expiry of 30 days from the date of service of the cross-claim; or

(c) in an application under Section 57 of the Constitution–before the expiry of 90 days from the date of service of the application; or
(d) in a claim made in the District Court–before the expiry of 90 days from the date of service of the summons,

or such further time as the court before which the action is instituted, upon sufficient cause being shown, allows.

5. Ms Yom for the Defendant has relied on the case of Tipaiza v Yali, Governor Madang Province [2005] PGNC 1; N2971 (1 February 2005) where the Court considered the following considerations for leave to file a Defence out of time;

1. what is the extent of the delay?
2. what are the reasons for the delay?

100. does the defendant appear to have a good defence?
     

6. Ms Yom submitted that the delay is about three years and two weeks from the time they were served the Writ of Summons and vigorously argued that the delay was not intentional on the part of the Defendants as instructions were not forthcoming from the Department of Health. Ms Yom further states that the Defendants have a Defence on merits as the facts of the Defence are deposed to in the Affidavit of the Late Dr Paison Dakulala on 14 September 2020 and that a draft Defence is annexed to the Affidavit Ms Yom filed on 21 September 2020.

7. I am not satisfied that the Defendants’ explanation for the delay in filing a Defence within the required time and or taking steps to seek leave to file a Defence is reasonable. The Affidavit of the previous action officer in the Solicitor General’s Office, Ms Bathsheba Kulumbu filed on 31 July 2017 gives reasons that due to the immense workload of files in the Solicitor General’s Office, an oversight occasionally occurs on the part of a lawyer to file a Notice of Intention to Defend or Defence for matters against the State. She admits that it was an oversight on her part to not take appropriate steps to file a Defence in time. She states in her Affidavit that a letter was sent to the Department of Health on 25 June 2014 requesting instructions after receipt of a Section 5 Notice however there were never any instructions from the Department of Health. From 2014 to 2017 when Ms Kulumbu filed her Affidavit, there was no explanation as to any follow-ups from Ms Kulumbu.

8. Ms Yom deposes in her Affidavit filed on 21 September 2020 that as soon as she was assigned the file, she took steps to communicate by email with the Department of Health in 2020 however the Department responded that due to a change in their accounting system, they could not ascertain the claim as to how much was already paid to the Plaintiff.

9. Ms Yom in her Affidavit deposes that the Defendants have a Defence on merit as they claim the Plaintiff did not comply with section 2A of the Claims By and Against the State Act and Section 47B-D of the Public Finance Management Act 1995. Mr Cooper argues that the contract with the First Defendant was duly entered in full compliance with all procedures as the First Defendant has paid previous invoices raised by the Plaintiff for the work done.

10. I enquired with Ms Yom whether it was appropriate that the draft Defence of the Defendants should be annexed to her Affidavit and whether it should be deposed to by some responsible officer preferably an authorised Officer heading the Department of Health as Ms Yom as the lawyer for the Defendants has no first-hand knowledge of matters as to evidence regarding the claim and she puts herself at the risk of being cross-examined as to the evidentiary matters raised. Ms Yom argues that her Affidavit only deposes to a defence in law as opposed to facts and that the facts are deposed to in the Late Dr Paison Dakulala’s Affidavit.

11. The Supreme Court case of Nivani Limited v The Independent State of Papua New Guinea (2020) SC1945 which referred to the Supreme Court case of Pena v J's Motors Ltd (2006) SC961 states this with the important consideration underlined;

One of the primary considerations to be taken into account when determining an application for leave to file a defence out of time is whether the defendant has a defence on the merits. This consideration is only properly satisfied if the defendant, in addition to providing a draft defence, provides detailed evidence in support of the defence. This issue was settled by the Supreme Court in Pena v J's Motors Ltd (2006) SC961:

To show a defence on the merits a proposed draft defence is not sufficient. The applicant must “condescend upon particulars”, that is, not just plead but set out statements of material fact by affidavit evidence which supports the pleading and is sufficient to satisfy the Court that the applicant has a prima facie defence and that it is reasonable that the applicant should be allowed to raise that defence. And that affidavit evidence must be sworn by persons with knowledge of the facts and not the lawyer for the applicant. An affidavit sworn by a lawyer that there is a good defence is generally not sufficient.

12. I am of the view that Ms Yom should have produced an Affidavit from someone with authority from the Department of Health to depose to and annex a copy of the Draft Defence for the attention of the Court that as per the Supreme Court decision cited above, the consideration for whether the Defendants have a proper defence or a meritorious defence can be properly satisfied and an affidavit by a lawyer in carriage of the matter that her clients have a good defence is not sufficient.

13. Having addressed all the considerations for the grant of leave to file a Defence out of time, let me say that lawyers have a higher duty to their clients to act swiftly and to act accordingly under the Professional Conduct Rules in the discharge of their duty to the Court and to their clients. The immense workload in the Office of the Solicitor General demands a better management under the Solicitor General as the advocate of the State under section 15 of the Attorney General’s Act. A lawyer stands to be professionally negligent if he or she omits to act accordingly in the discharge of their duties and the calling sets the bar very high in a profession that is dwindling but the Court should at all times demand the performance and output of lawyers as officers of the Court and as professionals in an esteemed profession to keep raising the bar as to standards, to keep raising the bar on ethics and integrity and quality in the deliverance of their duties.

14. I am not satisfied by the reasons given by both Ms Kulumbu and Ms Yom that they did everything within their capacity to ensure they acted swiftly and appropriately as officers in the Solicitor General’s Office and as lawyers with a duty to their clients the State. May I admonish counsels to raise their performance and seek the engagement of the Solicitor General if their workload is overwhelming at records high as the Office of the Solicitor General is a doorkeeper to the litigation affairs of the State.

15. There is a lengthy delay in seeking leave to file a Defence out of time, there is no reasonable explanation for the delay in filing a Defence in time or seeking leave to file a Defence out of time and there is no reasonable defence deposed to which includes a Draft Defence by a responsible Officer in the Health Department to properly satisfy that the Defendants have a defence on merits.

16. I, therefore, make the following orders:

1. The Defendant’s application seeking leave to file a Defence out of time is refused.
2. As costs is a discretionary matter, the Defendants shall meet the Plaintiff’s costs of the application on a solicitor-client basis as punitive for the lawyers’ conduct addressed in this ruling.
   

Orders accordingly.

_____________________________________________________________

TL Copper Lawyers: Lawyers for the Plaintiff

Office of the Solicitor General: Lawyers for the Defendants