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Henganofi Development Corporation Ltd v Public Officers Superannuation Fund Board [2010] PGSC 27; SC1025 (3 May 2010)

SC1025


PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]


SCA NO 59 OF 2009 & SCA NO 60 OF 2009


BETWEEN


HENGANOFI DEVELOPMENT CORPORATION LIMITED
Appellant


AND


PUBLIC OFFICERS SUPERANNUATION FUND BOARD
Respondent


Waigani: Gavara Nanu, Lenalia & Makail, JJ
2009: 25th November &
2010: 3rd May


SUPREME COURT APPEALS - Civil appeals - Practice & Procedure - Objection to competency - Application for leave to appeal - Notice of appeal - Simultaneously filed - Appeal arising from same decision of National Court - Identical or duplication of grounds of appeal - Whether permissible - Questions of fact - Questions of law - Questions of mixed fact and law - Whether application for leave to appeal incompetent - Whether notice of appeal incompetent - Supreme Court Act - Sections 4, 14 & 17 - Supreme Court Rules - Order 7, rules 1-8, 14 & Forms 7 & 8.


Facts


The appellant simultaneously filed an application for leave to appeal and a notice of appeal from the same decision of the National Court. The proposed grounds of appeal in the application for leave to appeal were identical to the grounds of appeal in the notice of appeal. The respondent objected to the competency of the application for leave to appeal and notice of appeal on the grounds that the appellant was in breach of the rule in Henzy Yakham & Ors -v- Dr Stuart Hamilton Merriam & Anor [1998] PNGLR 555; (1997) SC533, which prohibited simultaneous filing of application for leave to appeal and notice of appeal; the proposed grounds of appeal in the application for leave to appeal and the grounds of appeal in the notice of appeal were identical; the decision of the National Court was final and the principles relied upon for seeking leave to appeal were inapplicable and misconceived and the proposed grounds of appeal in the application for leave to appeal raised questions of law and questions of mixed fact and law where leave to appeal was not required.


Held:


1. The appellant was permitted to simultaneously file an application for leave to appeal and a notice of appeal so long as the proposed grounds of appeal in the application for leave to appeal raised questions of fact and the grounds of appeal in the notice of appeal raised questions of law and questions of mixed fact and law: see Henzy Yakham's case (supra).


2. The proposed grounds of appeal in the application for leave to appeal and the grounds of appeal in the notice of appeal were identical as they raised questions of law and questions of mixed fact and law.


3. The appellant was not permitted to plead identical grounds of appeal in the application for leave to appeal and notice of appeal as it was not only improper but also an abuse of process. However, it is not the sole determinative ground to dismiss the application for leave to appeal and notice of appeal as being incompetent.


4. The test or criteria to determine whether an application for leave to appeal and a notice of appeal pleading identical grounds of appeal were incompetent was whether the proposed grounds of appeal in the application for leave to appeal raised questions of law and questions of mixed fact and law where leave to appeal is not required under section 14(2)(b) of the Supreme Court Act and whether the grounds of appeal in the notice of appeal raised questions of fact where leave to appeal is required under section 14(2)(c) of the Supreme Court Act.


5. In this case, the application for leave to appeal was incompetent because the proposed grounds of appeal raised questions of law and questions of mixed fact and law where leave was not required under section 14(2)(a)&(b) of the Supreme Court Act and was dismissed.


6. The notice of appeal was competent because the grounds of appeal raised questions of law and questions of mixed fact and law where leave was not required under section 14(2)(a)&(b) of the Supreme Court Act and was allowed.


The following cases are cited in this ruling:


Papua New Guinea cases:
Henzy Yakham & Ors -v- Dr Stuart Hamilton Merriam & Anor [1998] PNGLR 555; (1997) SC533
Opai Kunangel -v- The State [1985] PNGLR 144
Nerau -v- Solomon Taiyo Ltd [1993] PNGLR 395
Bruce Tsang -v- Credit Corporation (PNG) Ltd [1993] PNGLR 112
Hii Yii Ann -v- Canisus Kami Karingu (2003) SC718
Boyope Pere -v- Emmanuel Niningi (2003) SC711
Oio Aba -v- Motor Vehicles Insurance Limited (2005) SC779
The State & Ors -v- John Talu Tekwie (2006) SC846
Paul Bari & Ors -v- John Raim (2004) SC768
Vincent Kaupa & Anor -v- Simon Poraituk & Ors (2008) SC955
Jeffrey Turia & Anor -v- Gabriel Nelson & Anor (2008) SC949
Wahgi Savings & Loans Society -v- Bank of South Pacific Limited (1980) SC185
Dillingham Corporation of New Guinea Pty. Ltd. -v- Constantino Alfredo Diaz [1975] PNGLR 262


Overseas cases:
British Launderers' Research Association -v- Central Middlesex Assessment Committee and Hendon Rating Authority [1949] 1 All ER 21


Counsel:
Mr K Frank, for Appellant
Mr T Anis, for Respondent


03rd May, 2010


RULING ON OBJECTION TO COMPETENCY


1. BY THE COURT: Before us are two objections to competency by the respondent to dismiss first, the appellant's application for leave to appeal filed on 09th June 2009 and secondly, the notice of appeal filed on 09th June 2009. The objections were filed on 25th June 2009 pursuant to Order 7, rule 14 of the Supreme Court Rules and raised four grounds, which we will come to shortly.


Brief background facts


2. The back ground facts giving rise to the application for leave to appeal and appeal and the objections are these: on 06th June 1989, the appellant signed the agreement with the respondent to obtain funds to construct a building in Goroka town.


3. It was agreed the respondent would lend K1 million to the appellant and in consideration, the appellant would issue 1 million worth of cumulative preferential shares to the respondent. It was also agreed that during the duration of the loan which was, 10 years, the respondent would enjoy a fixed cumulative preferential dividend of 13% per annum that was payable, 6 months in arrears. It was also agreed that at the end of the 10 years, the appellant would redeem its shares after it had fully repaid its loan plus interest. The shares were redeemed at the end of the 10th year in 1999 with the principal loan sum. From the 10 year period, the appellant had only declared interest once and that was on the 10th year. The appellant claimed that it had not made profits for the other 9 years.


4. The respondent disputed the appellant's claim and in the year, 2000, took the matter to the National Court by commencing proceeding, WS No 748 of 2000. The appellant also cross claimed against the respondent, claiming inter-alia declaratory orders that it was not indebted to the respondent. The matter was tried on 05th November 2007 and on 30th April 2009, the National Court handed down its decision by finding the appellant liable and awarding K1,053,164.38 in favour of the respondent. In so doing, it refused the appellant's cross claim. This is the decision which is the subject of the appeal.


Grounds of objections


5. In the meantime, we are being asked by the respondent to dismiss the application for leave in SCA No 59 of 2009 and notice of appeal in SCA No 60 of 2009 for four reasons and they are:


1. The appellant has simultaneously filed the application for leave to appeal in SCA No 59 of 2009 and notice of appeal in SCA No 60 of 2009 in respect of the same decision of the National Court of 30th April 2009 which is in breach of the rule in Henzy Yakham's case (supra), where the Supreme Court comprising of Amet CJ, Kapi DCJ, and Los J, held that, where a person desires to appeal against questions of law as well as questions of fact in the same matter or decision of the National Court, a notice of appeal must be filed in accordance with Form 8 of the Supreme Court Rules in respect of questions of law and mixed fact and law and an application for leave to appeal must be filed in accordance with Form 7 of the Supreme Court Rules in respect of questions of fact alone.


2. The proposed grounds of appeal in the application for leave to appeal in SCA No 59 of 2009 are identical to the grounds of appeal raised in the notice of appeal in SCA No 60 of 2009. This is in breach of the Supreme Court Practice Direction No 1 of 1998.


3. The present appeal is against a final decision of the National Court and the principles relied upon by the appellant in the application for leave to appeal in SCA No 59 of 2009 are inapplicable and misconceived.


4. Alternatively, proposed grounds of appeal 2.1, 2.2, and 2.8 of the application for leave to appeal do not require leave to appeal and proposed grounds 2.3, 2.4, 2.5, 2.7 and 2.9 of the application for leave to appeal partially do not require leave to appeal.


Issues


5. Except for the first ground of objection, we shall address the remaining three grounds of objection together because in our view, they are inter-related and raise the same issues. The first ground of objection raises the issues of whether or not the appellant is permitted to simultaneously file an application for leave to appeal and a notice of appeal in relation to the same decision of the National Court. The remaining grounds of objection raise the following issues:


1. Whether or not the proposed grounds of appeal in the application for leave to appeal in SCA No 59 of 2009 and the grounds of appeal in the notice of appeal in SCA No 60 of 2009 are identical and in breach of the Supreme Court Practice Direction No 1 of 1998;


2. If so, whether both the application for leave to appeal in SCA No 59 of 2009 and notice of appeal in SCA No 60 of 2009 should be dismissed for pleading identical grounds of appeal; and


3. Whether or not the proposed grounds of appeal in the application for leave to appeal in SCA No 59 of 2009 raise questions of fact where leave is required and whether the grounds of appeal in SCA No 60 of 2009 raise questions of law and questions of mixed fact and law where leave to appeal is not required.


First ground of objection


6. Mr Anis of counsel for the respondent in his submissions urges us to dismiss the application for leave to appeal and notice of appeal because they were filed simultaneously. He quotes from an observation made by Amet CJ, in the decision of Henzy Yakham (supra) to support his contention that the application for leave to appeal and notice of appeal are incompetent for this reason and should be dismissed. To put Mr Anis' contention into perspective, we respectfully quote from his Honour's observation hereto; "From this construction it is not appropriate for an applicant for leave to appeal to file a prospective notice of appeal for which leave is required, simultaneously with the notice of application for leave to appeal within 40 days of the date of the judgment in question. In an appeal which raises questions of fact only and for which leave of the court is necessary, only an application for leave need be filed within the 40 days from the date of the judgment, until that application has been heard and determined, following which if leave be granted then Order 7 Rule 5 will be invoked." (Emphasis added).


7. With Mr Anis' contention in mind, we now address the first issue of whether or not the appellant is permitted to simultaneously file an application for leave to appeal and a notice of appeal in relation to the same decision of the National Court raised in the first ground of objection. We begin by accepting that Henzy Yakham's case ( supra), stands for the proposition that, where a person desires to appeal against questions of law as well as questions of fact in the same matter or decision of the National Court, a notice of appeal must be filed in accordance with Form 8 of the Supreme Court Rules in respect of questions of law and questions of mixed fact and law and an application for leave to appeal must be filed in accordance with Form 7 of the Supreme Court Rules in respect of questions of fact alone.


8. This is the distinction between the two processes under sections 14 and 17 of the Supreme Court Act and Order 7, rules 1-8 of the Supreme Court Rules. The distinction is trite and fundamental to all appeals to the Supreme Court, whether by leave or as of right. The decision in Henzy Yakham's case (supra) was the "turning point" because in the pre Henzy Yakham days, it was generally accepted by both practitioners and Court that it was permissible for appellants to seek leave to appeal where leave is required within the same notice of appeal notwithstanding the absence of an application for leave to appeal so long as the notice of appeal was filed within 40 days. The Supreme Court decision of Henzy Yakham (supra), we might say "outlawed" this practice. Litigants including practitioners were "told" in no uncertain terms that this generally accepted practice was wrong as it was not in conformity with the requirements of sections 14 and 17 of the Supreme Court Act and Order 7, rules 1-8 and Forms 7 and 8 of the Supreme Court Rules: see also Opai Kunangel -v- The State [1985] PNGLR 144, Nerau -v- Solomon Taiyo Ltd [1993] PNGLR 395 and Bruce Tsang -v- Credit Corporation (PNG) Ltd [1993] PNGLR 112.


9. Following the decision in Henzy Yakham's case (supra), practitioners have moved away from the generally accepted but misconceived notion of filing and seeking leave in the same notice of appeal to that of filing an application for leave to appeal separately from a notice of appeal in cases where leave to appeal is required. The decision also resulted in the issuance of the Supreme Court Practice Direction No 1 of 1998 which essentially directed parties to separately file applications for leave to appeal from notices of appeal in cases where leave is required. But we can find nowhere in that decision, the Supreme Court ruling that a person who desires to appeal a decision of the National Court is not permitted to simultaneously file an application for leave to appeal and a notice of appeal nor can we find any subsequent decision of the Supreme Court deciding the issue under consideration.


10. A case that came close to deciding the issue under consideration is Hii Yii Ann -v- Canisius Kami Karingu (2003) SC718. In that case, the respondent was awarded costs in an earlier Supreme Court appeal matter. He submitted his bill of costs for taxation to the Registrar and the Registrar disallowed all the costs except out of pocket expenses. Aggrieved by this decision, the respondent applied for review of the taxed cost before the Court. The appellant filed a motion to dismiss the respondent's application for review of the taxed cost on the basis that it was filed outside 14 days time limit stipulated by Order 22, rule 60(2) of the National Court Rules. The Court found that the application for review was filed within time and was competent and dismissed the objection.


11. Aggrieved by that decision, the appellant filed an application for leave to appeal in SCA No 19 of 2002 and notice of appeal in SCA No 20 of 2002 to the Supreme Court. The respondent objected to the competency of the application for leave to appeal and the notice of appeal on the basis that the decision was interlocutory and leave was required. The Supreme Court held that the decision was interlocutory and leave to appeal was required. The Supreme Court did not go on to decide whether it was proper or permissible for the appellant to simultaneously file an application for leave to appeal and appeal although we note the Supreme Court observed in passing that:


"The question that quite correctly arises at the outset is whether that ruling is a final judgement or an interlocutory one? That is where the argument must be confined in our view. In this respect in a way we agree with Mr Karingu that there is no need to confuse the central issue in the dispute by lodging two documents, an Application for Leave to Appeal and a Notice of Appeal in the guise of conforming with the requirements of the Law set out in Yakham v. Merriam [1997] Supreme Court Judgement SC533 as the Appellant has attempted to do here. In fact the two-pronged appeal itself is even a misconception of the judgement in Yakham v. Merriam (supra) because this is not an appeal against a final judgment following a substantive hearing of the dispute that ultimately determined the rights of the parties. This case is not setting any new precedent but simply clarifying the law governing the appeal process in the light of the seemingly conflicting views that prevailed since the decisions in Opai Kunangel v The State [1985] PNGLR 144; Nerau v Solomon Taiyo Ltd [1993] PNGLR 395 and Tsang v Credit Corporation [1993] PNGLR 112." (Emphasis added).


12. The upshot of all these discussions is that, according to the decision in Henzy Yakham's case (supra), an application for leave to appeal shall be filed separately from a notice of appeal and in accordance with Form 7 while a notice of appeal in accordance with Form 8 of the Supreme Court Rules. This is what the appellant has done in this case, although we note that the Supreme Court in Hii Yii Ann's case (supra) expressed disapproval of this "two pronged" appeal process in a guise of conforming with the rule in Henzy Yakham's case (supra), that is, the simultaneous filing of documents. In our view, it is only an obita dictum as the real issue before that Court was whether or not the judgment appealed from was interlocutory.


13. Returning to Mr Anis' submissions in respect of the observation made by Amet CJ, in Henzy Yakham's case (supra), we reject it because it is misconceived as it is taken out of context. That is not what his Honour was saying when he made that observation. What his Honour was saying is that, where grounds of appeal raise questions of fact where leave to appeal is required, an appellant is not permitted to file a notice of appeal raising questions of fact until and unless leave is granted. Once leave is granted, the appellant shall be entitled to either file a notice of appeal or treat the application for leave to appeal as the notice of appeal if the grounds of appeal are sufficiently pleaded. But there is nothing preventing the appellant from filing a notice of appeal where the grounds of appeal do not require leave at the same time as the application for leave to appeal where the proposed grounds of appeal require leave.


14. As we understand the submissions of Mr Frank of counsel for the appellant, the appellant seeks leave to appeal in the application for leave to appeal in SCA No 59 of 2009 from questions of fact where leave is required. This is separate from the notice of appeal where the grounds of appeal raise questions of law and questions of mixed fact and law where no leave is required. The respondent does not challenge the competency of the application for leave to appeal on the basis that the proposed grounds of appeal do not raise questions of fact in this first ground of objection. It only takes issue with the simultaneous filing of the application for leave to appeal and notice of appeal. Given this position, we find no basis for Mr Anis' contention that, in the decision of Henzy Yakham (supra) the Supreme Court ruled that it is not permitted to simultaneously file an application for leave to appeal and notice of appeal from the same decision of the National Court.


15. It follows therefore that, it is permissible for appellants to simultaneously file an application for leave to appeal and a notice of appeal under sections 14 and 17 of the Supreme Court Act and Order 7, rules 1-8 and Forms 7 and 8 of the Supreme Court Rules respectively. But we qualify this proposition. The qualification is this, it is permissible to do that so long as the proposed grounds of appeal in the application for leave to appeal raise questions of fact, and the grounds of appeal in the notice of appeal raise questions of law and questions of mixed fact and law. Put it another way, appellants are perfectly entitled to plead grounds of appeal raising questions of fact in an application for leave to appeal and grounds of appeal raising questions of law and questions of mixed fact and law in a notice of appeal from the same decision of the National Court and may file them simultaneously. For these reasons, we conclude that the first ground of objection is misconceived and we dismiss it.


Second, third and fourth grounds of objection


16. But we note that the respondent also objects to the application for leave to appeal in SCA No 59 of 2009 and notice of appeal in SCA No 60 of 2009 as being incompetent on the basis that they raise identical grounds of appeal. This leads us to the second issue and that is, whether or not the proposed grounds of appeal in the application for leave to appeal in SCA No 59 of 2009 and the grounds of appeal in the notice of appeal in SCA No 60 of 2009 are identical, as such, in breach of the Supreme Court Practice Direction No 1 of 1998 and ought to be dismissed.


17. Mr Anis submits that the proposed grounds of appeal in the application for leave to appeal in SCA No 59 of 2009 are identical to the grounds of appeal in the notice of appeal in SCA No 60 of 2009. The identical grounds of appeal are duplication of one and same appeal hence, in breach of Supreme Court Practice Direction No 1 of 1998. Consequently, it renders both the application for leave to appeal and notice of appeal incompetent. On the other hand, Mr Frank submits that the appellant is entitled to have it "both ways", that is, it is permissible for the appellant to file an application for leave to appeal and a notice of appeal raising the same grounds of appeal if the appellant is "not sure" or "in doubt" if the grounds of appeal require leave.


18. He further submits that when "in doubt", it is permissible to file an application for leave to appeal pleading the same grounds of appeal as those in the notice of appeal to preserve the appellant's right of appeal in case the notice of appeal is struck out for being incompetent for want of leave. For this submission, he refers us to the Supreme Court decision of Boyope Pere -v- Emmanuel Niningi (2003) SC711, where the Supreme Court held that, in a case where leave to appeal is sought when leave is not required and the appellant is outside of the 40 days time limit to file a notice of appeal and no issue is taken on a party's right to appeal as of right, that party should be given leave to pursue his appeal.


19. He concludes by submitting that the filing of the application for leave to appeal and the notice of appeal raising identical grounds of appeal was prompted by the late instructions from the appellant to appeal the decision of the National Court, hence insufficient time to determine whether the appeal lay with leave or as of right.


20. We do not wish to recite the proposed grounds of appeal in the application for leave to appeal in SCA No 59 of 2009 at this juncture because we will eventually be examining them when we consider the final issue later on in the ruling. But we consider it appropriate to set out in full the grounds of appeal in the notice of appeal in SCA No 60 of 2009 for parties to appreciate our reasons in relation to the issue of identical grounds of appeal and we do so below:


"3.1 The learned Judge erred in law in his findings and conclusions when he awarded Judgment in favour of the Respondent.


3.2 The learned Judge erred in law and mixed fact and law when he concluded that the sum of K2,153,164.38 ("Sum Payable"), was due and payable to the Respondent -


(a) When -


(i) K1,000,000.00 of the Sum Payable was payable by the Appellant to redeem the Cumulative Preference Shares held by the Respondent ("Shares");


(ii) K1,253,164.38 of the Sum Payable represented the total dividend payable pursuant to the Constitution of the Appellant ("Constitution") and the Cumulative Preference Share Agreement ("Agreement") as calculated by the Respondent and set out in the Table under paragraph 3(d) of the Supplementary Affidavit of Patricia Taureka sworn on 12/07/01 and filed on 13/0701 in the proceedings below (Table of Dividend Calculation"); and


(iii) The "PRINCIPAL" amounts set out in the second column of the Table of Dividend Calculation represents part of the capital of the Appellant (as opposed to declared dividend);


(b) When the learned Judge impliedly found and concluded that the dividend payable to the Respondent ought to be calculated in the manner set out in the Table of Dividend Calculation;


(c) When the learned Judge impliedly found that the dividend payable to the Respondent was payable on a portion of the capital of the Appellant equivalent to the price the Respondent paid for the Shares and is calculated in the manner set out in the Table of Dividend Calculation;


(d) When the findings and conclusions in sub paragraphs 3.2(b) and (c) hereof were contrary to the findings and conclusions of the learned Judge, inter-alia, that -


(i) A shareholder does not receive dividend unless profit if made;


(ii) In the event a company makes a loss no dividend is declared and no dividend is payable;


(iii) The 13% rate could not be sustained after 30/07/99 when Shares were redeemed;


(iv) Out of the maximum 10 years duration of the Shares before the date when the Shares were redeemable, the Applicant made profit and declared dividend in just one year;


(e) when Judgment was contrary to the finding by the learned Judge specified in paragraph 3.2(d) hereof;


(f) when such findings and conclusions were contrary to the evidence which was before the learned Judge;


3.3 The learned Judge erred in law and in fact when he failed to find that:-


(a) On the true meaning and construction of the Constitution and Agreement, dividend was payable only on profits declared for distribution and at 13 percent of the profit so declared for distribution (as opposed to a percentage of the capital value representing the purchase price paid for the Shares);


(b) only K100,000.00 out of the K1,100,000.00 paid by the Appellant represented the profit for the year 1999 that was declared for distribution to all shareholders of the Appellant;


(c) the Respondent was entitled to only 13% of the K100,000.00 specified in paragraph 3.3(b) hereof;


3.4 The learned Judge erred in law and in fact (sic) awarding the Judgment: -


(a) By which the learned Judge impliedly concluded, contrary to the true meaning and construction of the Constitution and Agreement, that dividend was payable at 13 percent of the capital value representing the purchase price paid for the Shares;


(b) By which the learned Judge impliedly concluded that the K100,000.00 specified in paragraph 3.3 hereof was on account of dividend due and payable to the Respondent.


(c) When the said K100,000.00 represented profit that was declared for distribution to all shareholders of the Appellant;


(d) When the Respondent was entitled to only 13% of the K100,000.00 specified in paragraph 3.3(b) hereof;


3.5 The learned Judge erred in law and in fact in dismissing the Applicant's Cross-Claim for the reasons specified in the Grounds specified in paragraphs 3.3 and 3.4 hereof.


3.6 The learned Judge ought to have awarded judgment to the Applicant's Cross Claim for reasons specified in Grounds specified in paragraphs 3.3 and 3.4 hereof.


3.7 The learned Judge erred in law and in fact in awarding the Judgment when His Honour ought to have granted a declaration as to the rights and entitlements of the Respondent (if any) to dividend that the Appellant may declare after the date when the Shares were redeemed.


3.8 The learned Judge erred in law and mixed fact and law when he awarded interest at 8 percent on the Judgment sum of K1,053,164.38, which award was contrary to his findings and conclusions in paragraph 3.2(d) hereof;


3.9 The learned Judge erred in law and in fact in awarding the Judgment in that the Judgment constituted an award of simple interest at 13 percent per annum when there was no legal basis for such an award."


21. A careful perusal of the proposed grounds of appeal in the application for leave to appeal in SCA No 59 of 2009 and the grounds of appeal in the notice of appeal in SCA No 60 of 2009 as set out above, clearly establish that the grounds of appeal are identical or duplicated. We are therefore satisfied that, the grounds of appeal are identical. Given this, the next issue is, should the application for leave to appeal and notice of appeal be dismissed for this reason?


22. This is the third issue we have to determine. It is our opinion that, it is not permissible to plead identical grounds of appeal in the application for leave to appeal and notice of appeal in a guise of complying with the rule in Henzy Yakham's case (supra) and the Supreme Court Practice Direction No 1 of 1998. It is also improper and an abuse of process. However, we are of the view that both the application for leave to appeal and notice of appeal should not be dismissed for pleading identical grounds of appeal. Instead, only one should be dismissed. We have two reasons for holding this view.


23. First, we are of the view that the case of Boyope Pere (supra) which the appellant relies on to support its contention that, it is permissible to do so is of no assistance. The ratio of that case, shortly stated is that, because an appeal is incompetent where leave is required and not sought, it does not follow that an application for leave to appeal is incompetent where leave is not required and is sought. In that case, the appellant filed an application for leave to appeal and no notice of appeal. It was subsequently held by the Supreme Court that he did not require leave to appeal as his appeal laid as of right. Since he had gone past the 40 days time limit to appeal under section 17 of the Supreme Court Act, the Supreme Court granted him leave to proceed with his appeal in any case. In reaching that decision, the Supreme Court said:


"What this means in short is that, the requirement for leave to appeal under s.14 of the Supreme Court Act is to ensure only meritorious cases go to the Supreme Court on appeal particularly in cases where leave is required. Does the same apply in a case where a party is granted a right of appeal as of right, but leave is sought any way? We are of the view that, the same does not apply. Where a person is granted a right of appeal by the Supreme Court Act or any other legislation or where there is no contest on an application for leave to appeal to the Supreme Court, the question of whether or not leave should be granted is not an issue... It should reasonably follow from this that, where a person has a right of appeal but seeks leave, he should be allowed to proceed with his appeal. We consider this important because in some cases there may be instances in which it might not be clear as to whether an appeal lies as of right or with leave. In such a case, it would be advisable to seek leave in order to avoid the risk of an appeal being found incompetent for leave not being first sought and obtained: Henzy Yakham & Anor -v- Meriam & Meriam case. In other cases, an appellant may inadvertently seek leave when it is strictly not required.


In either of these cases the application for leave must be considered on its merits. If the Court is satisfied that there is merit in the proposed grounds of appeal or that the appellant should have appealed as of right, the appellant should be granted leave or allowed to proceed to lodge his appeal. After all, the application does no harm or cause any prejudice to the other side. The only disadvantage any such application could cause to the respondent is costs. That can easily be compensated for by an order for costs. On the other hand, if an appellant is shut out purely on account of seeking leave instead of appealing right away, he might be left to suffer under the judgment he seeks to appeal against. The judgment the appellant wants to appeal against might be wrong in law or in fact or both. Unless that is corrected on appeal, it may continue to represent an error of judgment at the expense or loss of the party seeking to appeal."


24. Since then, we note two Supreme Court cases have followed the decision of Boyope Pere (supra). They are; Oio Aba -v- Motor Vehicles Insurance Limited (2005) SC779 and The State & Ors -v- John Talu Tekwie (2006) SC846. In Oio Aba's case (supra), the appellant filed an application for leave to appeal, where the proceedings in the National Court had been struck out for failure to show a good cause of action because the appellant had not given notice of intention to claim pursuant to section 54(6) of the Motor Vehicles (Third Party) Insurance Act. The Supreme Court held that the application for leave to appeal was unnecessary. However, following Boyepe Pere's case (supra), it granted leave. The Supreme Court observed:


"Leaving aside that issue, and our reservations as to whether we would have come to the same conclusion as the Court in that case, we accept that the case is authority for the proposition that where Application for Leave to Appeal has been filed, though unnecessarily, and no Notice of Appeal has been filed, and the Application discloses merits, leave should be granted. Whether or not the application discloses merits is a matter to be decided on hearing the application for leave. We therefore decline to strike out the Application for Leave, simply on the basis that such an application was unnecessary."


25. In the case of John Talu Tekwie (supra), Mr Tekwie filed an objection to competency of the respondents' application for leave to appeal citing inter-alia that the judgment of the National Court sought to be appealed was not interlocutory as it was related to an application seeking "unconditional leave to defend" for which leave was not required. In other words, the appellants should have filed a notice of appeal as of right. The Supreme Court followed the decision in Boyepe Pere's case and held that a conditional leave to defend is refusal of unconditional leave to defend within the meaning of section 14(4) of the Supreme Court Act, as such, leave is not required from such an order and went on to grant leave although it was mistakenly sought on the basis that there was an arguable case on appeal. It reached that decision "[a]s Boyope Pere -v- Emmanuel Niningi is the unanimous decision of a bench of 3 judges, we feel obliged to follow it so that there is not a multiplicity of views on a procedural point which should not be consuming large amounts of counsels and court time."


26. In another case of Paul Bari & Ors -v- John Raim (2004) SC768, the Supreme Court dismissed an application for leave to appeal from an objection to competency. In that case, the National Court refused an application to set aside a default judgment and leave to file a defence out of time. The Supreme Court held that, the effect of the decision was to make the judgment, final as between the parties. As leave was not required, the application for leave to appeal was incompetent. A notice of appeal was not filed and the appellants were out of time to file one. The application for leave to appeal was dismissed. It appears that, the case of Boyepe Pere (supra) was not drawn to the attention of the Court in that case. Hence, we cannot speculate if the Supreme Court would have ruled otherwise if that case was brought to its attention.


27. The case of Vincent Kaupa & Anor -v- Simon Poraituk & Ors (2008) SC955, is slightly different because it is not clear from the judgment of the Supreme Court if the appeal was allowed to proceed to hearing on the basis that the "appeal raises arguable issues or has merit" even though the application for leave to appeal was unnecessary. But it is clear that the Supreme Court dismissed the objection because it was of the view that a "stay order" was not an injunctive order for the purposes of section 14(3)(b)(ii) of the Supreme Court Act and leave was required. Finally, in Jeffrey Turia & Anor -v- Gabriel Nelson & Anor (2008) SC949, the first respondent objected to the competency of the application for leave to appeal citing inter-alia, it was unnecessary. In dismissing the objection, the Supreme Court inter-alia found that the decision appealed from was interlocutory where leave was required. But even if the first respondent had argued that the decision was in effect a grant of an injunction, hence leave was not required by virtue of section 14(3)(b)(ii) of the Supreme Court Act, the Supreme Court would have still granted leave to the appellants to proceed with their appeal. The Supreme Court gave this reason for that decision:


"However, even if that argument had been raised and we had upheld it, it would still not have made the application for leave incompetent. Nor would it have rendered the appeal incompetent. If an appellant files an application for leave to appeal within 40 days, it does not necessarily matter if it is later realised by the parties or ruled by the court that leave was not required. In the ordinary course of events the court will not order that such an application or any subsequent notice of appeal is incompetent. Rather, the court would grant leave to file a notice of appeal outside the 40-day period (Boyepe Pere v Emmanuel Ningi (2003) SC711, Oio Aba v MVIL (2005) SC779, The State v John Talu Tekwie (2006) SC843)."


28. We have laboured to refer to at least two cases of Oio Aba (supra) and John Talu Tekwie (supra), which followed the decision of Boyope Pere (supra), one of Paul Bari (supra), deciding otherwise whilst two others, Vincent Kaupa (supra) and Jeffery Turia (supra) observed in passing the decision of Boyope Pere (supra) to point out one fundamental factual difference which distinguishes them from the present case and that is, in all those cases, the appellants did not simultaneously file an application for leave to appeal and a notice of appeal. Consequently, when the Supreme Court subsequently found that leave to appeal was unnecessary in those cases, the Supreme Court nonetheless, granted leave to the appellants to appeal, as their appeals were arguable or had merits notwithstanding the lack of notice of appeal except, in Paul Bari's case (supra).


29. In the present case, the appellant has filed an application for leave to appeal as well as a notice of appeal pleading identical grounds of appeal. In our respectful opinion, it cannot have it "both ways" based on the principle in Boyope Pere's case (supra). This is because, according to Boyope Pere's case (supra), there must be an application for leave to appeal filed and that, the Court must subsequently find that leave to appeal is not necessary for the Court to grant leave to the appellant to proceed further with the appeal. For this reason, we are of the opinion that it is not permissible to plead identical grounds of appeal in an application for leave to appeal and a notice of appeal in a guise to conform to the decision in Boyope Pere's case (supra) and the Supreme Court Practice Direction No 1 of 1998. However, in our view also, it does not necessary follow that both the application for leave to appeal and the notice of appeal should be dismissed for pleading identical grounds of appeal. We will return to elaborate on this point later.


30. The second reason is this, with respect, we reject Mr Frank's submission that the appellant pleaded the same grounds of appeal in the application for leave to appeal and the notice of appeal as it was "in doubt" as to whether or not the grounds of appeal would require leave of the Court and it did so to avoid its appeal from being struck out for want of leave and to preserve it's right of appeal. We consider that, when lawyers are briefed to appeal decisions of the National Court, it is expected of them to judge the appeals on their merits as it is within their professional experience and knowledge to form an opinion as to whether or not a particular appeal would require leave.


31. This is part and partial of the discharge of their professional duties to their clients, and of course, the Court, and the Court is entitled to expect that they must be able to discern from the available information and the decision of the National Court the grounds of appeal raising questions of fact, questions of law and questions of mixed fact and law when preparing appeals to the Supreme Court. It is therefore, not sufficient, in our view to say that, it is "unclear" if the grounds of appeal require leave or no leave. It is also neither a sufficient ground nor a reasonable and satisfactory explanation to plead identical grounds of appeal in applications for leave to appeal and notices of appeal because of late instructions from appellants to appeal decisions of the National Court.


32. In this case, the explanation offered by the appellant and its lawyers is unconvincing and unsatisfactory because it is clear to us from the available materials in the affidavit of Mr Kenneth Frank sworn on 11th November 2009 and filed on 12th November 2009 that he was counsel in the National Court, having took charge and conduct of this matter since "day one" up until the decision of the National Court on 30th April 2009. This means that, it is expected of him to be well versed with the intricate details of the case which would have placed him in an advantageous position than any other lawyer in his firm when it came to preparing the appeal on short notice.


33. We consider that, what the appellant has done in this case is, in fact asking the Court to decide for it and its lawyers which grounds of appeal require leave and which do not. We cannot do that for them and we do not think the Supreme Court in Boyope Pere's case (supra) envisaged such a situation when it said:


"........................ where a person has a right of appeal but seeks leave, he should be allowed to proceed with his appeal. We consider this important because in some cases there may be instances in which it might not be clear as to whether an appeal lies as of right or with leave. In such a case, it would be advisable to seek leave in order to avoid the risk of an appeal being found incompetent for leave not being first sought and obtained: Henzy Yakham & Anor -v- Meriam & Meriam case. In other cases, an appellant may inadvertently seek leave when it is strictly not required."


34. If we are to accept the appellant's proposition, it would no doubt open "flood-gates" and this Court will be inundated with this type of application. We can foresee disaster ahead if we allow this practice to flourish. For these two reasons, we are of the view that it is not permissible to plead identical grounds of appeal in an application for leave to appeal and notice of appeal. However, it is also our view that, this reason or ground is not sufficient to dismiss the application for leave to appeal and notice of appeal. This is the point we said we would return to elaborate further and we do so now. To that end, we consider that, in cases where identical grounds of appeal are pleaded in the application for leave to appeal and notice of appeal, the Court is entitled to strike out one of the documents, that is, either the application for leave to appeal or the notice of appeal, but not both. For, to strike out both would deny appellants the right to appeal decisions of the National Court, especially where the grounds of appeal are arguable or meritorious.


35. We consider that, the only way the Court may decide which document it may strike out is by ascertaining from the application for leave to appeal if the proposed grounds of appeal raise questions of fact. If they raise questions of law and questions of mixed fact and law, then they are incompetent and the application for leave to appeal ought to be struck out. Likewise, if the grounds of appeal in the notice of appeal raise questions of fact instead of questions of law and questions of mixed fact and law, the notice of appeal ought to be struck out as being incompetent. In our view, this is the test or criteria to determine whether the identical grounds of appeal in the application for leave to appeal and the notice of appeal are incompetent: see sections 4(2)(a) - (c) and 14(1)(a) - (c) of the Supreme Court Act. In other words, pleading identical grounds of appeal in the application for leave to appeal and notice of appeal is not the sole determinative ground for upholding an objection to competency.


36. This leads us to the final issue which is, whether the proposed grounds of appeal in the application for leave to appeal in SCA No 59 of 2009 raise questions of fact where leave to appeal is required under section 14(2)(c) of the Supreme Court Act. Mr Anis submits that proposed grounds of appeal 2.1, 2.2 and 2.8 raise questions of law where leave is not required hence, they are incompetent whilst proposed grounds 2.3, 2.4, 2.5, 2.7 and 2.9 are partially incompetent, because they raise questions of mixed fact and law where leave is also not required. On the other hand, Mr Frank submits that proposed grounds 2.2 and 2.3(b) raise questions of fact where leave to appeal is required while he concedes that the rest of the proposed grounds raise questions of law and questions of mixed fact and law where leave is not required.


37. An appeal raising questions of fact requires leave of the Supreme Court pursuant to sections 4(2)(c) and 14(1)(c) of the Supreme Court Act. What is a question of fact? In the Supreme Court case of Wahgi Savings and Loan Society Ltd -v- Bank of South Pacific Ltd (1980) SC185, per Kearney DCJ, answered this question in this way:


"What are questions of fact and law are difficult to determine. On this question Lord Denning said:


"On this point it is important to distinguish between primary facts and the conclusions from them. Primary facts are facts which are observed by witnesses and proved by oral testimony, or facts proved by the production of a thing itself, such as an original document. Their determination is essentially a question of fact for the tribunal of fact, and the only question of law that can arise on them is whether there was any evidence to support the finding. The conclusions from primary facts are, however, inferences deduced by a process of reasoning from them. If and in so far as those conclusions can as well be drawn by a layman (properly instructed on the law) as by a lawyer, they are conclusions of fact for the tribunal of fact and the only questions of law which can arise on them are whether there was a proper direction in point of law and whether the conclusion is one which could reasonably be drawn from the primary facts. ... If and so far, however, as the correct conclusion to be drawn from primary facts requires, for its correctness determination by a trained lawyer - as, for instance, because it involves the interpretation of documents, or because the law and the facts cannot be separated, or because the law on the point cannot properly be understood or applied except by a trained lawyer - the conclusion is a conclusion of law on which an appellate tribunal is as competent to form an opinion as the tribunal of the first instance."


38. See also British Launderers' Research Association -v- Central Middlesex Assessment Committee and Hendon Rating Authority [1949] 1 All ER 21 at 25-26. This same passage was referred to by Prentice DCJ, in the case of Dillingham Corporation of New Guinea Pty. Ltd. -v- Constantino Alfredo Diaz [1975] PNGLR 262 at 270:


"Where primary facts are found (which cannot be challenged on appeal except by leave of the court) the question of law is what is the proper conclusion to be drawn from those facts. It has been shown in decided cases that where inferences or conclusions are drawn from these primary facts which cannot reasonably be drawn, then this is an error of law. See Edwards (Inspector of Taxes) v. Bairstow and Another (1956) A.C. 1413; Instrumatic Ltd. v. Supabrase Ltd. (1969) 1 W.L.R. 51914. I cannot see anything in the circumstances of this country that would render these principles inapplicable. I adopt them as part of the underlying law (Schedule 2:2 of the Constitution)."


39. We have also had the benefit of reading the learned trial judge's decision of 30th April 2009 which may be found at annexure "N" and also pp 273-281 of the affidavit of Mr Kenneth Frank sworn on 11th November 2009 and filed on 12th November 2009 and deduce that the principal issue in the appeal relates to whether the preferential share agreement was breached by the appellant when it failed to pay K1,053,164.38 to the respondent as 13% cumulative dividend accrued in clause 3.2(a) of the preferential share agreement. We have perused the proposed grounds of appeal in the application for leave to appeal and they are centered on this very issue. For example, the learned trial judge found that the appellant breached the preferential share agreement and ordered the appellant to pay 13% interest of K1,053,164.38 and refused the appellant's cross claim.


40. Given these findings, we are of the view that the proposed grounds of appeal raise questions of mixed fact and law because the Court is being asked to ascertain whether there was evidence to support the findings of fact in relation to award of K1,053,164.38 and the interpretation of the relevant constitution of the appellant and the preferential share agreement where leave is not required under section 14(2)(b) of the Supreme Court Act. Therefore, the proposed grounds of appeal are incompetent.


Conclusion


41. We conclude that the proposed grounds of appeal in the application for leave to appeal in SCA No 59 of 2009 raise questions of mixed fact and law where leave to appeal is not required under section 14(2)(b) of the Supreme Court Act. It follows that it is unnecessary for the appellant to seek leave in respect of these proposed grounds of appeal. The application for leave to appeal is therefore, incompetent. Since the appellant has also filed a notice of appeal in SCA No 60 of 2009 within the 40 days time limit under section 17 of the Supreme Court Act, and in identical terms as those in the application for leave to appeal, we are of the view it raises meritorious grounds of appeal and must be allowed to proceed to a full hearing.


Orders


42. The respondent's objection in relation to the application for leave to appeal in SCA No 59 of 2009 is upheld and application for leave is dismissed as being incompetent. The respondent's objection in relation to the notice of appeal in SCA No 60 of 2009 is refused. As we have upheld one set of objection and refused the other, we consider that the appellant should bear the costs of both objections because it proceeded on a misguided view when it simultaneously filed the application for leave to appeal raising identical grounds of appeal as those in the notice of appeal. This has prompted the filing of these objections.


Ruling and orders accordingly.
___________________________________________
Lawyers for the Appellant: Young & Williams Lawyers
Lawyers for the Respondent: Blake Dawson Lawyers

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