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Hermit Island Ltd v National Fisheries Authority [2010] PGSC 14; SC1026 (30 April 2010)

SC1026

PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]

SCA 75 of 2006

BETWEEN

HERMIT ISLAND LIMITED
First Appellant

AND

HERMIT SEAFOODS LIMITED
Second Appellant

AND

KOROHON & SONS ENTERPRISES LTD
Third Appellant

AND

CHAPOKO LIMITED
Fourth Appellant

AND

MARINE PRODUCTS (PNG) LIMITED
Fifth Appellant

AND

WADI EXPORTS IMPORTS LIMITED
Sixth Appellant

AND

NATIONAL FISHERIES AUTHORITY
First Respondent

AND

THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Second Respondent

Waigani: Kapi, CJ, Sevua & Lenalia, JJ
2007: 29 August
2010: 30 April

PRACTICE AND PROCEDURE – Appeal against question of law and mixed question of law and fact - Leave is not required – Notice of Appeal to be filed in accordance with Form 8 – Order 7 Rule 8 (e) Supreme Court Rules

PRACTICE AND PROCEDURE – Appeal against questions of fact alone – Leave is required – Application for leave to appeal to be filed in accordance with Form 7 – Order 7 Rule (2) (e) Supreme Court Rules.

Held: - 1. Where a person desires to appeal against questions of law as well as questions of mixed fact and law, the appeal is as of right. Leave to appeal is not required and the appeal must be filed in accordance with Form 8 Supreme Court Rules. (Henzy Yakam & Ors v. Dr. Stuart Merriam & Anor (1997), SC 533, 27 November 1997, adopted and followed).

2. Where a person desires to appeal against questions of facts alone, leave is required. Application for leave to appeal must be filed in accordance with Form 7 Supreme Court Rules. (Henzy Yakam & Ors v. Dr. Stuart Merriam & Anor (1997), SC 533, 27 November 1997, adopted and followed).

3. Forms 7 and 8 stipulate two distinct procedures. Therefore the grounds of appeal and grounds of application for leave to appeal must not be incorporated into a single notice of appeal.

4. Where an appellant does not comply with the provisions of Order 7 Supreme Court Rules, and file the appropriate Form 7 or Form 8, his appeal will be rendered incompetent.

Cases cited in judgment

The Honourable John Nilkare v The Ombudsman Commission of Papua New Guinea [1996] PNGLR 413
Henzy Yakam & Ors v. Dr. Stuart Merriam & Anor (1997)(unreported), SC533, 27 November 1997
Bruce Tsang v. Credit Corporation (PNG) Limited [1993] PNGLR 112

Legislations Cited:

Supreme Court Act, ss 14, 17
Supreme Court Rules, Order 7
Supreme Court Forms – Forms 7 and 8

Counsel:

N. Kiuk, for Appellants
R. Mulina, for First Respondent
No Appearance, for Second Respondent

30 April, 2010

KAPI, CJ: Retired and deceased.

1. SEVUA & LENALIA, JJ: This appeal was heard on 29 August 2007, however since then, the President of the Court, Sir Mari Kapi, then Chief Justice, had retired and subsequently passed on. The remaining members of the Court has proceeded in accordance with s.3 of the Supreme Court Act which provides: -

3. Continuation of appeal notwithstanding absence of Judge

(1) Where in the course of an appeal before the Supreme Court and at any time before the delivery of the judgment, a Judge hearing the appeal is unable, through illness or any other cause, to attend the proceedings or otherwise to exercise his functions as a Judge –

(a) the hearing of the appeal shall, subject to Subsection (2), continue, and

(b) the judgment shall be given by the remaining Judges; and

(c) the Court shall be deemed to be duly constituted.

(2) Where –

(a) either party does not agree to the remaining Judges continuing to hear the appeal; or

(b) in any case, there is only one Judge remaining able to hear the appeal,

the appeal shall be reheard.

2. This judgment is therefore the judgment of the majority and the remaining members of the Court.

3. This course is consistent with the Supreme Court decision in The Honourable John Nilkare v. The Ombudsman Commission of Papua New Guinea [1996] PNGLR 413 at p.417 –

"Where a judge is unable to attend the proceedings or otherwise unable to exercise his functions as a judge, s.3 (1) of the Act enables the remaining judges to proceed to give judgment. This is subject to s.3 (2) of the Act."

4. Before us was an objection to competency of the appeal filed by the first respondent only.

5. The notice of appeal contained nine grounds. These are as follows:-

3.1 His Honour erred in law when he failed to refuse the Application by the Respondents by way of their Amended Notice of Motion filed on 8 June 2006, on the basis that:

(a) The directions issued by the National Court on 13 April 2006 were substantially compiled (sic) with prior to the issuance of the same. That being:-

(b) The initial return date as per the National Court Directions of 13 April 2006 was 23 May 2006. However without notice to the Appellants or their lawyers the National Court proceeded to issue Court Directions on 25 May 2006, in the presence of the Respondents lawyer only.

(c) That it was the National Court Directions of 25 May 2006 that directed the following:

"1. The matter is adjourned to 8 June 2006 for full directions hearing.

2. All parties must be fully prepared on the returnable date to assist the Court.

3. Should the Plaintiffs default in appearing, the matter shall stand dismissed.

4. Should the Defendant fail to appear, judgment shall be entered against them."

That the above Court Directions were not at any time made known to the appellants or their lawyers by the respondents or their lawyers. His Honour failed to consider this material fact which was brought to his attention on 14 June 2006 by the appellant's lawyers.

3.2 His Honour upon accepting the appellant's affidavit, failed to adequately consider, or at all the facts deposed to in the affidavit of Nickson Kiuk Magela sworn on 14 June 2006, which affidavit was critical to the determining of the effect of the self-executing orders of 25 May 2006.

3.3 His Honour erred in failing to find that the National Court Directions warranting dismissal of the proceedings were previously compiled (sic) with and that His Honour failed to consider adequately, or at all, the affidavit of Ben Lomai sworn on 19 October 2005 and filed on 25 October 2005 which manifested such facts.

3.4 His Honour erred in law and fact when he failed to exercise His discretion properly to set aside the self-executing orders when the Court became aware that the appellants nor their lawyers were aware of the National Court Orders of 25 May 2006 and the fact that the initial National Court Directions of 13 April 2006 were completed and at several occasions trial dates vacated at the National Court.

3.5 His Honour erred in law when His Honour intimated that owing to the self-executing nature of the National Court Directions of 25 May 2006, He did not have any power or jurisdiction to set aside the Directions, or and to extend same as sought by the appellants.

3.6 His Honour erred in law in distinguishing between a "Court Order" and a "Court Direction" and whether the words mean the same in meaning and effect.

3.7 His Honour erred in law by failing to disqualify Himself in presiding over this matter in the Court below since prior to His Honour's appointment as an Acting Judge and subsequently as the Judge of the National and Supreme Court of Papua New Guinea, His Honour was a Consultant with the Respondents lawyers' Law Firm and such fact was peculiarly within his knowledge.

6. The first respondent's objection to competency was filed on 15 August 2006. These are the three grounds of objection:

1. The Notice of Appeal filed on 21 July 2006 and served on the fifth respondents lawyers on 9 August 2006 purports at paragraph 1 that the appellant appeals the judgment of Honourable Justice Gabi dated 14 June 2006 against the appellant, which is an order that the fifth respondent says does not exist.

2. Under paragraph 4.2 of the Notice of Appeal, the appellants seek to quash a ".......judgment of the National Court dated 25 June 2006", which the fifth respondent says is an order that also does not exist.

3. The grounds of appeal under paragraph 3.1, 3.2, 3.3, and 3.7 raise pure questions of fact and therefore require leave of this Honourable Court under Section 4 (2) (c) of the Supreme Court Act (Chapter 37), in that:

(a) Paragraph 3.1(a) – require confirmation from the transcripts of 14 June 2006 whether the appellants have in fact complied with the Directions of the National Court made 13 April 2006; and

(b) Paragraph 3.1(b) & (c) – require production of transcripts of proceedings in WS No. 1387 of 2001 for 25 May 2006, and the affidavit materials (if any) filed by the appellants to confirm whether the appellants' lawyers were indeed absent and therefore could not know the next return date of proceedings WS No. 1387 of 2001; and

(c) Paragraph 3.2 requires confirmation from the transcripts of 14 June 2006 as to:

(i) Whether His Honour did in fact accept the affidavit of Nixon Kiuk Magela sworn 14 June 2006; and

(ii) Whether the said affidavit provided reasonable explanation or extension of time to comply with the initial Directions of 13 April 2006.

(d) Under paragraph 3.3, the appellants raise a question of fact as to whether His Honour's finding was assisted by the purported affidavit of Ben Lomai sworn 19 October 2005, which the fifth respondent says was never placed before the Court.

(e) Under paragraph 3.7 a question of fact arises as to whether His Honour Justice Gabi did have a conflict of interest in dealing with WS No. 1387 of 2001, and whether the issue was brought to His Honour's attention on 14 June 2006.

7. At the hearing of the objection, the appellants through their counsel, Mr. Kiuk advised the Court that the appellants would abandon grounds 3.1 (b) and (c) and 3.7, but would only proceed with grounds 3.1 (a), 3.2, 3.3, 3.4, 3.5 and 3.6.

8. Consequently, the first respondent withdrew grounds 1, 2 and 3 (b) and (e) of its objection to competency, but maintained grounds 3 (a), (c) and (d).

9. Therefore on the first respondent's objection, the Court is only concerned with grounds 3.1 (a), 3.2, 3.3, 3.4, 3.5 and 3.6.

10. Paragraph 2 of the notice of appeal stated that –

"2. The Appeal lies without leave because it requires questions of law and mixed fact and law and that the nature of the judgment made or given by the National Court was final," (our underlining).

11. Having perused the grounds of appeal carefully, we do not accept the submissions by Mr. Kiuk because the wordings of grounds 3.2 and 3.3 are couched in clear terms which raise issues of fact alone, not law or mixed fact and law. We will demonstrate this conclusion.

12. We start with ground 3.1 (a). We consider that the trial Judge's failure to refuse an application raises a question of law given that the reasons for such refusal would be based on law. The compliance or non-compliance with directions issued by the Court in relation to settlement of agreed and disputed facts; the issues for trial, and the giving of notice under the Evidence Act are matters of fact. Therefore we consider that ground 3.1 (a), (i) and (ii) raise questions of mixed fact and law therefore leave to appeal is not required.

13. Grounds 3.2 and 3.3 relate to allegations that the trial Judge failed to consider, or find as facts, certain matters contained in the affidavits of Nickson Kiuk Magela sworn on 14 June 2006, and the affidavit of Ben Lomai sworn on 19 October 2005. We consider that these two grounds of appeal raise questions of fact alone.

14. Ground 3.4 alleged errors of law and fact against the trial Judge in respect of the exercise of his discretion. This ground therefore raises questions of mixed fact and law.

15. Grounds 3.5 and 3.6 alleged errors of law against the trial Judge therefore those grounds are appeal against questions of law.

16. Having identified these grounds of appeal and whether they raise questions of fact, law or mixed fact and law, we now come to the discussion of the relevant law.

17. Section 14 of the Supreme Court Act deals with civil appeals to the Supreme Court. Order 7 Rules 1 – 5 deal with application for leave to appeal while Rules 6 – 13 deal with notice of appeal.

18. The law on filing of notice of appeal and application for leave to appeal has already been settled in our jurisdiction by the Supreme Court in Henzy Yakam & Ors v. Dr. Stuart Hamilton Merriam & Anor (1997), unreported, SC 533, 27 November, 1987. That is the precedent authority which all legal practitioners must follow. Unfortunately, it is a bad reflection on lawyers who do not read and follow that authority. Therefore, we will restate the law here for the benefit of those legal practitioners who do not know that judgment, or do not have it in their possession.

19. The Supreme Court, quite clearly, established the procedural law in respect of the practice and procedure relating to appeals against questions of law and mixed questions of mixed law and fact; appeals against questions of fact alone, and appeals against questions of law as well as questions of fact in the same matter.

20. Civil appeals are regulated by s.14 (1) of the Supreme Court Act. Section 14 (1) provides –

(1) Subject to this section, an appeal lies to the Supreme Court from the National Court –

(a) on a question of law; or

(b) on a question of mixed fact and law; or

(c) with the leave of the Supreme Court, on a question of fact

21. Section 17 which provides for the time for appealing is as follows:

17. Time for appealing under Division 2

Where a person desires to appeal to or to obtain leave to appeal from the Supreme Court, he shall give notice of appeal, or notice of his application for leave to appeal, as the case may be, in the manner prescribed by the Rules of Court within 40 days after the date of the judgment in question, or within such further period as is allowed by a Judge on application made to him within that period of 40 days.

22. In addition, Order 7 of the Supreme Court Rules prescribes the procedures to be followed where an appeal should proceed by way of an application for leave to appeal or a notice of appeal.

23. It is obvious, in our view, that Section 17 prescribes two distinct processes by way of a notice of appeal, and an application for leave to appeal. The manner and form in which these two procedures are to be invoked are clearly set out in Order 7 Division 1 Rules 1, 2 and 3; Division 2 Rules 4 and 5, and Division 3 Rules 6 to 9. The time limit for giving the notice of appeal and the application for leave to appeal is 40 days. However, that period may be extended to within such period allowed by a Judge on application to be made within that period of 40 days.

24. The Rules prescribe the forms in which the two documents are to be in. Both documents are different in form and content. The notice of appeal is to be in accordance with Form 8 while the application for leave to appeal is to be in accordance with Form 7.

26. It must be emphasized here that when the Henzy Yakam case was decided, the Court noted that inconsistent application of the Rules were being made. Regrettably, such inconsistencies are still evident up to the present time. And as we have alluded to, that comes about because many lawyers representing appellants in the Supreme Court do not read and follow the law established in that case. This is of concern to the Court.

27. We have already alluded to the grounds of appeal which the appellant is pursuing in this appeal and we have also ascertained the type of guideline each ground of appeal raises.

28. It must be reiterated that by Section 17 and Order 7 Rules 1 and 2, an application for leave to appeal, which is required to be filed in accordance with Form 7, must be given in all appeals which involve questions of fact alone and which requires leave of the Court.

29. We also reiterate that it is not appropriate for an applicant desiring leave to appeal to file a notice of appeal at the same time he files an application for leave to appeal within the 40 days time limit. If he is successful in his application for leave he can file a notice of appeal within 21 days from the date of grant of leave if ordered by the Court in accordance with Order 7 Rule 5. Where the appeal raises questions of fact alone, leave is required as a matter of law and the appellant must file an application for leave to appeal in accordance with Form 7 within the 40 days period as stipulated by Section 17 of the Act.

30. Pursuant to s.14 (1) (a) and (b) of the Act, an appeal which involves questions of law or mixed fact and law is an appeal as of right. No leave is required and a notice of appeal must be filed pursuant to s.17 and Order 7 Rules 6 to 9 and the notice of appeal must be in accordance with Form 8.

31. Where an appeal raises questions of fact only, leave is required by s.14 (1) (c) and an application for leave to appeal in accordance with Form 7 must be filed pursuant to s.17 and Order 7 Rules 1 and 2. These are procedures which must be adhered to by all litigants and their lawyers.

32. The two distinct procedures are expressed quite succinctly in Henzy Yakam so that there can never be any confusion or misunderstanding by lawyers representing appellants in Supreme Court appeals.

33. On unnumbered page 8 of the judgment, Amet, CJ expressed the two sets of procedures in the following manner -

"Following this judgment, which now clarifies and in effect over-rules Opai Kanagel v. The State and clarifies Nerau v. Solomon Taiyo and affirms Tsang v. Credit Corporation, all grounds of appeal that require leave shall be in accordance with Form 7 and only grounds of appeal that do not require leave or where leave has been previously obtained, can be filed in the terms of Form 8," (our underlining)

34. Kapi, DCJ (as he then was and now deceased), expressed his opinion at page 11 (unnumbered) in this way.

"The practical effect of all these provisions may be summarized in the following way. Where a person seeks to appeal against grounds which require leave to appeal, leave must be sought by using Form 7. If no leave is sought, the appeal will be dismissed for incompetence (see Tsang v. Credit Corporation [1993] PNGLR 112.

If an appeal involves a question of law or mixed fact and law only, an appeal must be filed in accordance with Form 8. The two procedures are different in nature and must be kept separate (see Tsang v. Credit Corporation (supra) at page 115)," (our underlining)

35. We have placed emphasis on the excerpts cited above to demonstrate the law and to show that our view accords with those expressed by their Honours in Yakam.

36. Again Kapi DCJ (as he was then) (deceased) reiterated his view at page 12 (unnumbered) where he said:

"I am of the opinion that the proper view to be taken of the practice and procedure with regard to the proper form to be filed in respect of each of the different grounds is as I have decided in this opinion. That is to say, all grounds of appeal which require leave of the Supreme Court must be filed separately in accordance with Form 7 and grounds of appeal which may be filed as of right shall be filed in accordance with Form 8 as modified."

37. In Yakam (supra) the Court referred to Tsang v. Credit Corporation [1993] PNGLR 112. It is actually reported as Bruce Tsang v. Credit Corporation (PNG) Limited [1993] PNGLR 112.

38. We just want to note in summary that that is a decision of the Supreme Court which affirms the position that where grounds of appeal require leave, whether the appeal stems from a substantive judgment or an interlocutory judgment, the proper procedure is to file an application for leave to appeal in accordance with Form 7.

39. We have noted that Yakam affirmed that view, and we also affirm it in this judgment. We also want to reiterate that the two distinct procedures we have alluded to are requirements of law that litigants and their lawyers must comply with as they cannot circumvent or substitute them in any manner.

40. In the present appeal, we have already analysed the different grounds of appeal that the appellants now rely on and we have already expressed our opinion on these different grounds of appeal.

41. However, in summary we reiterate our opinion as follows.

42. In relation to appeal grounds 3.1 (a); this ground raises questions of mixed fact and law. The Court's refusal to treat the appellant's application would have been based on reasons premised upon the law therefore this is a question of law.

43. The compliance, or non compliance with directions issued by the Court on statement of agreed and disputed facts; the issues for trial; and whether notice under the Evidence Act has been given or not, are issues of fact. They can be ascertained as a matter of fact therefore they do not raise any legal issue.

44. It is our view that the grounds of appeal raise questions of mixed fact and law and therefore it is an appeal as of right. Leave to appeal is not required under s.14 (1) (b) of the Supreme Court Act. The appellants were entitled to file a notice of appeal in accordance with Form 8 and Order 7 Rule 8.

45. However we note from the appellant's notice of appeal that the grounds of appeal are not restricted to matters involving issues of mixed fact and law. Instead, the appellants have included grounds of appeal in its notice of appeal which include issues of fact alone and which requires leave. This is improper and we consider that those grounds of appeal are incompetent and ought to be dismissed.

46. Grounds 3.2 and 3.3 are similar as they relate to two affidavits filed by Nickson Kiuk Magela and Ben Lomai. Both grounds contain allegations that the trial Judge had failed to consider, or failed to make findings of facts in matters contained in those affidavits.

47. As we have expressed earlier on, those grounds raise issues of fact alone. Pursuant to s.14 (1) (c) of the Supreme Court Act, leave to appeal is required on a question of fact.

48. Therefore as we have described from the judgment in Yakam, an application for leave to appeal should have been filed in accordance with Form 7 and Order 7 Rule 2.

49. Since the appellants have failed to comply with the requirements of procedural law, those grounds of appeal are incompetent.

50. Ground 3.4 alleges that the trial Judge erred in law by failing to properly exercise his discretion. As we have found, this ground raises a question of law therefore leave is not required as it is an appeal as of right. We have observed that the appellants have stated this in its notice of appeal and they seemed to have complied with the Act and the Rule except that, as we found, the grounds of appeal which do not require leave are mixed with grounds of appeal that require leave, and these have been incorporated in the one notice of appeal which, we consider to be improper as that is contrary to the principles of law in Yakam's case.

51. Our discussion on the law will show that this procedure is wrong in law. There are two distinct procedures covering appeals as of right, that is, appeals that do not require leave of the Court as opposed to appeals that require leave.

52. Because the appellants had failed to comply with the requirements of law, Ground 3.4 is also incompetent.

53. Grounds 3.5 and 3.6 alleged errors of law against the trial Judge therefore they are grounds raising questions of law. No leave is required therefore they were properly set out in the notice of appeal.

54. However again, we should emphasise, as we have already observed, that the appellants have mixed the grounds of appeal which do not require leave with those grounds of appeal that require leave, and they have stated all these grounds in one notice of appeal which is improper and a violation of the requirements under the Act and the Rules.

55. We therefore hold that both Grounds 3.5 and 3.6 are incompetent.

56. We concur with Amet, CJ (as he then was) in Yakam at page 7 (unnumbered) when he expressed a view that the Rules do not intend that grounds of appeal requiring leave and grounds of appeal which do not require leave should be incorporated into a single notice of appeal. There must be separate documents filed in accordance with Form 7 or Form 8, as the case may be, since there are two different procedures stipulated by the Rules.

57. That is why we are of the opinion that the appellants in this case, have improperly incorporated the grounds of appeal requiring leave with their grounds of appeal which do not require leave in the same notice of appeal. We reiterate what the Court said in Yakam's case that if parties do not comply with the two distinct procedures, they "run the risk of their appeal being rendered incompetent." The law has been settled therefore lawyers and litigants must observe the Supreme Court's pronouncement.

58. In the present case, we find that the appellants did not file their appeal in accordance with the stipulated practice and procedure, that is, the procedural law clearly expounded in Yakam's case.

59. The result therefore in our opinion, is that the grounds of appeal relied on by the appellants are incompetent and are dismissed with costs.

60. We order that costs follow the event.

____________________________________________
Lomai & Lomai Attorneys: Lawyer for the Appellants
Warner Shand: Lawyer for the Respondents