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Kepa v Yanum [2024] PGNC 265; N10933 (1 August 2024)

N10933

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

MP (COMM) NO. 23 OF 2023 (IECMS)

IN THE MATTER OF THE COMPANIES ACT 1997
AND:
IN THE MATTER OF BERNAL NO. 8 LIMITED (1-77801)

BETWEEN:
BERNARD KEPA
Petitioner

AND:
WESLEY YANUM
Respondent

Waigani: Carey J
2024: 25^th July & 1^st August

PRACTICE AND PROCEDURE – Application for dismissal of proceedings for abuse of process — Order 12 Rule 40 (1) (c) of the National Court Rules.

PRACTICE & PROCEDURE – Companies Act 1997, s 152 (3)– Question of non-compliance of the Companies Act 1997 – Application to dismiss proceedings for failure to name company.

This is an application by the Respondent to dismiss the proceeding as an abuse of the Court process pursuant to Order 12 Rule 40 (1) (c) of the National Court Rules. The Petitioner did not name the company in the proceeding.

Held:

1. The proceeding is dismissed in its entirety pursuant to Order 12 Rule 40 (1) (c) of the National Court Rules.
   
2. The Petitioner is to pay the Respondent’s costs of and incidental to this proceeding to be taxed, if not agreed.
   
3. Time for entry of the orders is abridged to the date of settlement by the Registrar of the National Court which shall take place, forthwith.
   

Cases Cited:
Gigira Development Corporation Ltd v Talu [2001] PGNC 79, N8852

Legislation:
Companies Act 1997

Counsel:
Mr. Jonathan Holingu, for the Petitioner
Mr. Michael Koimo, for the Respondent

JUDGMENT

1^st August 2024

1. CAREY J: This is an interlocutory application of Wesley Yanum (the Respondent) by way of Notice of Motion filed on 28^th May 2024 seeking to dismiss the entire proceeding for being abuse of the Court process and non – compliance of the Companies Act. The Respondent relies on Order 12 Rule 40 (1) (c) of the National Court Rules and Section 152 (3) of the Companies Act 1997 to move this application.
   
2. Bernard Kepa is the Petitioner.
   

BACKGROUND

3. The Petitioner filed the Petition challenging his removal as Director and Shareholder of Bernal No. 8 Limited (the Company).
   
4. On 19^th March 2024, Orders were issued by the Court pursuant to Section 142(1) (a) of the Companies Act.
   

ISSUES

1. Whether Bernal No. 8 Limited is a party to the proceeding?
2. Whether the Respondent is being sued in his personal capacity?

100. Whether the Petition is filed in compliance to Rule 14 of the Companies Rules?

4. Whether the Orders of 19^th March 2024 should be set aside?
   

5. The Company is not named as a party to this proceeding and the issue that is before the Court is one which involves the Petitioner and the Respondent.
   
6. The argument put forward by the Respondent that the Company should be named as a party is accepted as logical given there are issues revolving around Section 152 of the Companies Act and the action of the Respondent which impacts the Company.
   
7. The Petition is incompetent, and the argument proffered by the Petitioner does not negate the reality that should further orders be made in favour of the Petitioner against the Respondent which impact the Company, the Respondent as a Director and Shareholder will likely have the authority to effect same for the Company.
   
8. The Company is a separate legal entity. See Gigira Development Corporation Ltd v Talu [2001] PGNC 79, N8852.
   
9. There is no need to consider any further aspects of the submission in relation to the ISSUES b, c and d.
   

CONCLUSION

10. I am persuaded by the argument of the Respondent that the failure of the Petitioner to name the Company as a party renders this proceeding inconsistent with the outcome being sought by the Petitioner.
    
11. In this regard, it is an abuse of the Court process and not for the Court to remedy mistakes of parties in drafting of submissions or rectify fundamental material issues which are non-compliant with statute.
    

ORDERS

1. The proceeding is dismissed in its entirety pursuant to Order 12 Rule 40(1) (c) of the National Court Rules.
2. The Petitioner is to pay the Respondent’s costs of and incidental to this proceeding to be taxed, if not agreed.
   
3. Time for entry of the orders is abridged to the date of settlement by the Registrar of the National Court which shall take place, forthwith.
   

Ordered accordingly.

Holingu Lawyers: Lawyers for the Petitioner
KIPES Law: Lawyers for the Respondent