Home | Databases | WorldLII | Search | Feedback National Court of Papua New Guinea

Hari v Viri [2022] PGNC 40; N9496 (4 March 2022)

N9496

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS NO.175 OF 2018

BETWEEN:

MORATA HARI as principal landowner of Central Claim No.79.
Plaintiff

AND:
STEVEN MABATA VIRI, KURUKU VAIBUA, BABANI MABA, HARRY GEGE, GOROGO IORI, BURUKA CHARLIE, JIMMY CHARLIE and other members of Enehako Clan of Korobosea village, National Capital District.
First Defendants

AND:
REX MANGA WAPALIN
Second Defendant

Waigani: David, J
2022: 2^nd & 4^th March

TAXATION OF COSTS – application for review of taxation of Taxing Officer’s decision – application for entry of judgment on certified taxed costs – application for review of taxation filed within time – certified taxed costs exorbitant - National Court Rules, Order 2 Rules 11, 12, 13, 14, 15 and 19, Order 22 Rules 59(4), 60 and 62.

Cases Cited:
Papua New Guinean Cases

Kimlee Equipment and Spare Pty Ltd v Santa (PNG) Pty Ltd (1996) N1312
Waghi Savings and Loans Society Ltd v Bank South Pacific Ltd (1980) SC185
Abai v The State (2000) SC632
Pius Sankin v PNG Electricity Commission [2002] PNGLR 432
PNG Forest Authority v Securimax Security Pty Ltd (2003) SC717
Sir Arnold Amet v Peter Charles Yama (2010) SC1064
Talibe Hegele v Tony Kila (2011) SC1124
Coca Cola Amatil (PNG) Ltd v Joshua Yanda (2012) SC1221
Barava Ltd v Augustine Mamalau (2013) SC1301

Overseas Cases

Re Glassfund (1910) 27 VCR 357[1901] ArgusLawRp 112; , 7 ALR 276
Ogilvie v Massey [1910] P243
Slingsby v Attorney General [1918] P236
White v Altrindam Ulman District Council [1936] 1 All ER 926

Counsel:

Timil L. Tape, for the Plaintiffs
Jacob S. Kumbu, for the Defendants

RULING

4^th March, 2022

1. DAVID, J: INTRODUCTION: This is a ruling on two contested applications. One is an application by the plaintiff which is moved pursuant to a notice of motion filed on 8 November 2021 relying on Order 22 Rule 60 of the National Court Rules to review the decision of the Assistant Registrar – Equity, in his capacity as the Taxing Officer, allowing the sum of K23,260.60 inclusive of GST in favour of the first defendants which he certified on 23 September 2021 (the certified taxed costs). The first and main relief sought in the motion was amended without objection at the hearing. The other is an application by the first defendants which is moved pursuant to a notice of motion filed on 30 November 2021 seeking two main relief and these are; first, an order directing the entry of judgment on the certified taxed costs in their favour pursuant to Order 22 Rule 62 of the National Court Rules; and second, an order for the plaintiff to pay the amount specified in the judgment within 14 days pursuant to Order 12 Rule 1 of the National Court Rules and s.155(4) of the Constitution.
   

2. The plaintiff’s application is supported by the following affidavits:

1. Affidavit in Support of Timil L. Tape sworn on 19 October 2021 and filed on 8 November 2021;
2. Affidavit of Service of Neal P. Kidyala sworn on 10 November 2021 and filed on 12 November 2021;
3. Affidavit in Support of Grace Joel sworn on 1 December 2021 and filed on 3 December 2021; and
4. Supplementary Affidavit of Grace Joel sworn on 9 February 2022 and filed on 11 February 2022.
   

3. In opposing the plaintiff’s application and in supporting their application, the first defendants rely on and read the affidavit of Jacob Kumbu sworn on 24 November 2021 and filed on 30 November 2021.

4. The second defendant did not rely on any affidavit.

5. Mr. Kumbu informed the Court at the hearing that he was briefed by the lawyer for the second defendant to speak for and on behalf of the second defendant as well. Mr. Tape for the plaintiff took no issue with that.

LEGAL ISSUES

6. The main legal issues that require my consideration and decision are:

1. Whether the plaintiff’s application for review of taxation is competent?
2. If so, whether the Court should grant the application for review sought?
3. If not, whether the first defendants’ application for the entry of judgment on the certified taxed costs should be granted?
4. If the third issue is answered in favour of the first defendants, whether the plaintiff should be ordered to pay the amount specified in the judgment within 14 days?
   

COMPETENCY OF APPLICATION
Parties’ submissions

7. Mr. Kumbu submitted that the Court should dismiss the application for being incompetent as it was filed out of time, ie, later than 14 days after the date of the decision objected to, contrary to Order 22 Rule 60(2) of the National Court Rules.

8. Mr. Tape argued that the application was filed at the Registry within time on 19 October 2021, but due to the partial shutdown/lockdown of the Court premises including the Registry starting on 19 October 2021 due to Covid 19 Protocols when NJSS staff including Registry staff were required to be tested or vaccinated before going to work, the application was not registered until 8 November 2021 and served immediately thereafter.

Consideration

9. The power of the Court to review the decision of the Taxing Officer’s decision on taxed costs is found under Order 22 Rule 60: Kimlee Equipment and Spare Pty Ltd v Santa (PNG) Pty Ltd (1996) N1312, Barava Ltd v Augustine Mamalau (2013) SC1301.

10. For convenience, I set out below Order 22 Rule 60.

60. Application for review of taxation. (U.K. 62/33)

(1) Any party to any taxation proceedings who is dissatisfied with the allowance or disallowance in whole or in part of any item by the taxing officer, or with the amount allowed by the taxing officer in respect of any item, may apply on motion to a Judge to review the decision in respect of that item.

(2) An application for review of the taxing officer's decision shall be made within 14 days after the date of the decision objected to or within such further time as the Court may allow.

(3) Every applicant for review under this Rule must at the time of making his application deliver to the taxing officer objections in writing specifying the list of items to which the applicant objects and must state concisely the nature and grounds of each objection.

(4) An applicant for review under this Rule shall serve a copy of the objections on each other party (if any) who attended the taxation of those items and any other person whom the taxing officer directs shall be served.

11. It is settled law that issues that go to the competency of proceedings brought before courts can be raised at any time because the issue of competence is to do with jurisdiction, legality or viability or otherwise of the court process: Waghi Savings and Loans Society Ltd v Bank South Pacific Ltd (1980) SC185; PNG Forest Authority v Securimax Security Pty Ltd (2003) SC717; Sir Arnold Amet v Peter Charles Yama (2010) SC1064; Talibe Hegele v Tony Kila (2011) SC1124 and Coca Cola Amatil (PNG) Ltd v Joshua Yanda (2012) SC1221. I adopt these principles and apply them here.

12. It is not disputed that:

1. On 23 June 2021, following the hearing of a motion filed by the plaintiffs seeking a number of relief, the Court ordered the plaintiffs to pay the defendants’ costs of and incidental to the motion, to be taxed, if not agreed.
2. On 14 July 2021, the first defendants filed their application for taxation annexed to which were a copy of their itemised Bill of Costs (Bill of Costs) to be taxed and a copy of the order of 23 June 2021.
3. In the Bill of Costs, the first defendants claimed K64,410.00.
4. By letter dated 27 July 2021 to Gibson Bon, Lawyers for the first defendants, the plaintiffs through their lawyers registered their objections specifying the items to which they objected (Letter of Objections) and offered to settle at K500.00 on a without prejudice basis.
5. Taxation was conducted here at Waigani on 3 August 2021 at about 10:00 am with lawyers for the plaintiff (Grace Joel) and first defendants (Mr. Kumbu) in attendance.
6. At the taxation, Ms. Joel brought to the attention of the Taxing Officer, the Letter of Objections for his consideration.
7. Taxed costs allowed and settled by Nickson James, Assistant Registrar – Equity and Taxing Officer (the Taxing Officer) was K23,260.60.
8. On 23 September 2021, the Taxing Officer made a Certificate of Taxation certifying that taxed costs allowed and settled was K23,260.60 inclusive of GST.
9. The Certificate of Taxation was registered on the Court file on 11 October 2021.
10. The first defendants’ lawyers served a copy of the Certificate of Taxation on the plaintiffs’ lawyers through their letter of 12 October 2021 on the same day at about 11:21 in the morning and in that letter requested settlement of the taxed costs within seven days.
11. The application for review of taxation was purportedly filed at the Registry on 19 October 2021, but registered on the Court file on 8 November 2021.
    

13. It is not clear from the evidence brought before the Court as to when the Taxing Officer actually made his decision before the Certificate of Taxation was issued in accordance with Order 22 Rule 59(4), but it is abundantly clear that the decision of the Taxing Officer on the plaintiffs’ application for taxation by way of the Certificate of Taxation was served on the plaintiffs’ lawyers on 12 October 2021 at about 11:21 am. Therefore, the plaintiffs’ lawyers would have become aware of the Taxing Officer’s decision by then. Under Order 22 Rule 60(2), an application for review of the Taxing Officer’s decision must be made within 14 days after the date of the decision objected to or within such further time as the Court may allow.

14. In the present case, given the circumstances, the application for review of taxation ought to have been filed by 26 October 2021.

15. The Registry hours are set out under Order 2 Rule 11 of the National Court Rules. The Registry is open to the public for business everyday of the year except Saturdays, Sundays and Court holidays between 08:00 am and 03:30 pm. Court holidays include a public holiday as defined in s.3 of the Interpretation Act, any day specified under the National Court Rules or by resolution of Judges to be a Court holiday and any part of a day during vacation when the Registry is closed (Order 2 Rule 14). The Registry can be opened outside of business hours for urgent business, etc, upon payment of a prescribed fee by any party or practitioner or any person having any interest in any proceedings pending or about to be commenced (Order 2 Rule 12) or at the direction of a Judge (Order 2 Rule 13).

16. Order 2 Rules 15 and 19 of the National Court Rules are relevant, in my view, in determining when the application for review of taxation was filed in the present case and they are reproduced below.

“15. Register of documents filed.

There shall be kept in the Registry a register of all documents filed and all proceedings taken in any cause or matter showing the dates on which such documents are filed or such proceedings taken.”

“19. Date of filing.

The date of filing shall be written by the Registrar on every document which is filed.”

17. The combined reading and effect of these rules is that there is an emphasis placed on the date of filing of documents. So, in my view, documents are deemed to have been filed on the date they are received by clerks in the Registry.

18. Clearly, the application for review of taxation, if taken to have been filed at the Registry on 19 October 2021, which I do, was filed within time. A reasonable explanation has been provided for and on behalf of the plaintiff as to why the application for review of taxation was only registered on 8 November 2021. That was due to the partial shutdown/lockdown of the Court premises including the Registry from 19 to 26 October 2021 and the issuance of certain Covid 19 mandates including the requirement for all NJSS and Registry staff to be vaccinated and entry of staff to Court premises limited to those showing to security personnel green vaccination cards or negative Covid 19 PCR test results. A Circular Instruction issued by Mr. Jack Kariko, Secretary of the National Judicial Staff Service on 19 October 2021 to all staff, Acting Chief Justice, Judges and Divisional Managers, a copy of which is annexed to the Supplementary Affidavit of Ms. Joel as annexure “A”, confirms that fact. The partial shutdown/lockdown of the Registry was not due to any Court holiday, but because there was the presence of an exceptional circumstance. This evidence is not rebutted by any evidence to the contrary. At any rate, the plaintiff ought not to be penalised for the inaction or omission of clerks in the Registry or the partial shutdown/lockdown of the Registry that brought about the late processing and registration of the application for review of taxation which was beyond the control of the plaintiff.

19. Given this, I find that the application for review of taxation is competent.

APPLICATION FOR REVIEW

20. The Taxing Officer has a very wide discretion. The exercise of the discretion must be made on proper basis and the amount allowed must be reasonable.

21. The Court will not interfere with the exercise of the Taxing Officer’s discretion, and it rarely does, except in cases where he/she acted on wrong or mistaken principles or that the amount allowed was exorbitant or in exceptional cases: Re Glassfund (1910) 27 VCR 357[1901] ArgusLawRp 112; , 7 ALR 276; Ogilvie v Massey [1910] P243; Slingsby v Attorney General [1918] P236 at 239; White v Altrindam District Council [1936] 1 All ER 926; Abai v The State (2000) SC632.

22. In Pius Sankin v PNG Electricity Commission [2002] PNGLR 432, Kandakasi, J (as he then was) observed that the Taxing Officer was duty bound and it was also a good practice for him/her to give written reasons for his decision when exercising his/her discretion to allow or disallow an item of costs claimed to avert any suggestion that the discretion exercised was without any good reason. I set out the relevant parts of the judgment below:

“I consider it good practice on the part of a taxing officer to record his decision and reasons for decision in writing, especially in cases where there is a serious issue and there is indication of an application for review. This should be done as a matter of course. A party dissatisfied with a decision of a taxing officer should assist in that process by indicating its intention to apply for a review. On the filing of an application for review, the taxing officer would become aware of a challenge to his decision. He or she should therefore immediately provide a written reason for his or her decision. To expedite that process, it would be appropriate to serve a copy of the application for review on the relevant taxing officer if the filing of such an application is not with him or her or he or she is not in a position to become aware of it. A failure to provide any reason for a decision on a seriously disputed item may have the effect of the decision being arrived at without any good reason.

It is settled law that, a discretion that is vested in a decision-maker in a democratic society such as ours must be exercised on proper consideration as to the relevant facts and the law. There is no such a thing as unfettered discretion. Good reasons must be given for an exercise of discretion. A failure to do so may leave open the floodgate for all sorts of allegations, including allegations that the discretion was exercised for ulterior motives....

Taxing officers are vested with the discretion under the Rules, particularly, Order 22, either to allow or disallow an item of costs claimed. When exercising that discretion, a taxing officer is duty bound to give good reasons for his decision. Where there is a serious dispute over a bill of costs or a part of it, it is incumbent on the taxing officer to record his reasons for making a decision on that in writing. This is to assist in the event of an application for a review of his decision and to avoid any suggestion of the discretion being exercise without any good reason.”

23. I concur with His Honour’s observations.

24. The reasons for the Taxing Officer’s decision to allow taxed costs at K23,260.60 or alternatively a worksheet containing details of the items allowed or disallowed in the Bill of Costs are not in the evidence produced before the Court. No application, formal or otherwise, was made by any of the parties for the Court to direct the Taxing Officer to provide his reasons either or alternatively a worksheet containing the details of items allowed or disallowed in the Bill of Costs.

25. Mr. Tape submitted that the following matters be considered by the Court:

1. The certified taxed costs emanate from costs awarded following the hearing of a motion as opposed to hearing on the substantive matter.
2. The plaintiffs objected to almost all of the items claimed in the Bill of Costs in the objections contained in the Letter of Objections.
3. At taxation, the Taxing Officer did not allow lawyers present to orally advance their objections or arguments in relation to items claimed in the Bill of Costs as he assured them that he would consider the objections raised in the Letter of Objections and tax the itemised Bill of Costs accordingly.
   

26. Mr. Kumbu contended that the certified taxed costs was reasonable.

27. Evidence provided by Ms. Joel was that the Taxing Officer did not hear arguments from the lawyers present on items claimed in the Bill of Costs and instead gave an assurance to both Mr. Kumbu representing the first defendants and herself representing the plaintiff that he would consider the objections contained in the Letter of Objections and tax the Bill of Costs accordingly.

28. In the absence of the reasons for the Taxing Officer’s decision to allow the certified taxed costs at K23,260.60 or alternatively evidence of a worksheet containing details of the items allowed or disallowed in the Bill of Costs to arrive at that amount, it is extremely difficult to quantify what amount would be considered as reasonable in the circumstances of this case.

29. In considering what would be a reasonable amount in the circumstances of this case, I have considered the objections contained in the Letter of Objections and the certified taxed costs. In the Letter of Objections, the plaintiff stated that:

1. The itemised costs in the Bill of Costs were too high and beyond what was allowed under Schedule 2 (Scale of Costs) of the National Court Rules;
2. Costs were ordered to be on a party-party basis;
3. Costs for interlocutory proceedings involving issuing, filing and service of any notice of motion, etc was allowed at the rate of K10.00 to K45.00 and the time spent seemed exaggerated;
4. Costs for other documents filed and relied on, being a couple of affidavits, was allowed at the rate of K10.00 to K45.00 and the time spent seemed exaggerated;
5. Costs for copies of documents was allowed at the rate of K0.50 to K0.60 per page so costs claimed was inflated;
6. Costs for appearing and arguing a contested case should have been limited to one occasion so the costs claimed was exaggerated;
7. Counsel’s travelling expenses within the city is not allowed;
8. Costs for attendances under Part 5 is allowed at the rate of K15.00 for each hour or part of an hour so the costs claimed was exaggerated;
9. Costs for preparation for hearing under Part 7 was exaggerated;
10. Costs for attendances to correspondence was exaggerated;
11. Costs for compilation and perusal of affidavits, etc was exaggerated;
12. Costs of and incidental to the taxation of the Bill of Costs was exaggerated and no forewarning in writing was given to the plaintiff either to make comments on a draft bill of costs or to discuss settlement prior to the filing of the Bill of Costs.
    

30. I am satisfied in the circumstance of this case that the total amount allowed in the certified taxed costs is exorbitant and I generally accept the plaintiffs’ submissions in that regard.

31. The objections contained in the Letter of Objections largely have merit.

32. Even the Bill of Costs for K64,410.00 submitted for taxation, in my view, was unreasonably high or exorbitant as well.

33. Mr. Tape suggested that an amount between K500.00 to K3,000.00 was reasonable.

34. No issue was taken in relation to the question of compliance with requirements under Order 22 Rule 60(3) and (4) so, I have not addressed them specifically.

35. This is an exceptional case where the amount allowed in my view is exorbitant: Abai v The State (2000) SC632. I grant the application for review of taxation of the Taxing Officer’s decision.

36. Accordingly, in the exercise of the Court’s power to review taxation of costs under Order 22 Rule 60, the certified taxed costs of K23,260.60 is set aside and is substituted by the sum of K3,000.00.

REMAINING LEGAL ISSUES

37. Given this, it is now not necessary to address the remaining two main legal issues. Consequently, the first defendants’ application is dismissed.

ORDER

38. The formal orders of the Court are:

1. The application for review of taxation moved by the plaintiff’s notice of motion filed on 8 November 2021 is granted.
2. The taxed costs certified by the Taxing Officer at K23,260.60 is set aside and substituted by the sum of K3,000.00.
3. The first defendants’ application moved by notice of motion filed on 30 November 2021 is dismissed.
4. Costs shall be in the cause.
   

Ruling and orders accordingly

___________________________________________________________________
Kandawalyn Lawyers: Lawyers for the Plaintiff
Gibson Bon Lawyers: Lawyers for the First Defendants
Yariyari Lawyers: Lawyers for the Second Defendant