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Chin-Sik Son v Roniotis [2023] PGSC 42; SC2397 (15 May 2023)

SC2397


PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]


SCA NO 34 OF 2023


CHIN-SIK SON
First Applicant


PAKO F & C HOLDING (PNG) LTD
Second Applicant


V


NICK RONIOTIS AS HONORARY CONSUL OF
THE INDEPENDENT STATE OF PAPUA NEW GUINEA
TO THE HELLENIC REPUBLIC OF GREECE
First Respondent


LINDA PARU
Second Respondent


&


SCA NO 35 OF 2023


PAKO F & C HOLDING (PNG) LTD
Applicant


V


NICK RONIOTIS AS DIRECTOR OF
CLOUDY BAY SUSTAINABLE FORESTRY LIMITED
Respondent


Waigani: Cannings J
2023: 12th, 15th May


PRACTICE AND PROCEDURE – application for leave to appeal against interlocutory judgments of National Court that stayed execution of writ of levy of property – Supreme Court Act, s 14(3) – whether leave necessary – whether each interlocutory judgment was a case of granting an injunction – whether s 14(3)(b)(ii) applied, making leave unnecessary – whether an unnecessary leave application is incompetent – criteria to apply when determining an application for leave to appeal.


The applicants applied for leave to appeal against interlocutory judgments of the National Court in two separate originating summons (OS) proceedings. Each judgment ordered a stay of execution of a writ of levy of property issued in other National Court proceedings, which was commenced by writ of summons (WS) in 2014 and concluded, after resolution of an appeal against the decision of the National Court in those WS proceedings. At the hearing of the leave applications, the respondents argued that each application was unnecessary as the interlocutory judgments of the National Court granted an injunction and leave to appeal was not required by virtue of s 14(3)(b)(ii) of the Supreme Court Act, which states: “No appeal lies to the Supreme Court without leave of the Supreme Court ... from an interlocutory judgement made or given by the National Court except ... in cases of granting or refusing an injunction ...”; and that each appeal should be summarily dismissed. The applicants and respondents also put arguments on whether each application should be granted, if the applications were not summarily dismissed.


Held:


(1) The interlocutory judgment of the National Court in each case was not an injunction, but a stay of execution of a judicial process, and did not fall into the exception in s 14(3)(b)(ii) of the Supreme Court Act. Leave to appeal was necessary.

(2) To be granted leave to appeal against an interlocutory judgment of the National Court, the applicant must at least demonstrate an arguable case of error on the part of the National Court.

(3) Once an arguable case is demonstrated, other considerations to take into account include whether there are cogent and convincing reasons or exceptional circumstances or clear legal grounds warranting the grant of leave, whether a patent error or a jurisdictional error on the part of the National Court is apparent, whether there is no other recourse in the National Court available to the applicant, whether any exercise of discretion by the National Court was manifestly unreasonable or based on a wrong principle or mistake of fact, whether the interlocutory judgment has a bearing on the final determination of issues between the parties or causes a substantial injustice to the applicant and whether there is good cause for interrupting the trial process in the National Court.

(4) The applicants in each matter showed that there was an arguable case that to order a stay of execution of the writ of levy of property issued in unrelated and resolved WS proceedings, in circumstances where the rights of appeal of the respondents in connexion with the judgment of the National Court in those WS proceedings had been exhausted, was an error of law.

(5) There appeared to be exceptional circumstances and clear legal grounds warranting the grant of leave. There was a reasonable argument that the National Court had made a jurisdictional error in granting a stay of the writ of levy of property. Though it was open to the applicants to apply to the National Court to set aside the interlocutory judgments, a substantial injustice to the applicants was apparent and good cause was shown for interrupting the trial processes in the National Court.

(6) Furthermore, there appeared to be an arguable case that each OS was an abuse of process.

(7) Leave was granted to appeal against the interlocutory judgments of the National Court.

Cases Cited


The following cases are cited in the judgment:


Chan v Ombudsman Commission [1999] PNGLR 240
Joseph v Sereva (2011) SC1152
Kalinoe v Paraka (2010) SC1024
Kaupa v Poraituk (2008) SC955
Liu v Emoto (2009) SC1032
Makeng v Timbers (PNG) Ltd (2008) N3317
Mirupasi v Bonou (2009) SC1049
Oberia v Charlie (2005) SC801
Pako F & C Holding (PNG) Ltd v Cloudy Bay Sustainable Forestry Ltd (2021) N9141
Pato v Manjin [1999] PNGLR 6
Punagi v Pacific Plantation Timber Ltd [2011] 2 PNGLR 92
Ramu Nico Management (MCC) Ltd v Tarsie [2010] 1 PNGLR 88


Counsel


G J Sheppard & M Numi, for the Applicants
C Zazeng, for the Respondents


15th May, 2023


  1. CANNINGS J: This is a ruling on two applications for leave to appeal against interlocutory judgments of the National Court in two separate originating summons (OS) proceedings:
  1. In each of those proceedings the National Court, constituted by Salika CJ, on 2 March 2023 granted orders sought by notice of motion by the plaintiffs and amongst other things ordered a stay of execution of a writ of levy of property issued in other National Court proceedings that involved directly or indirectly the parties to the OS proceedings.
  2. Those other proceedings, WS 794 of 2014, were a breach of contract action for damages brought by Pako F & C Holding (PNG) Ltd against Cloudy Bay Sustainable Forestry Ltd. The National Court upheld the claim and awarded damages and interest of approximately K117.5 million (Pako F & C Holding (PNG) Ltd v Cloudy Bay Sustainable Forestry Ltd (2021) N9141). Cloudy Bay Sustainable Forestry Ltd appealed to the Supreme Court against determination of liability and assessment of damages. Mr Sheppard, for the applicants in the present proceedings, informed the court that the appeal was dismissed and finally resolved with rejection of a slip rule application in 2022. I was given no case citation to reflect dismissal of the appeal or rejection of a slip rule application. However, Mr Zazeng, for the respondents, did not counter the proposition that the appeal against the National Court decision in N9141 was fully resolved in 2022, so I deal with the present applications on the basis that that proposition is correct.
  3. A writ of levy of property was issued in WS 794 of 2014 on 25 November 2022. The Sheriff then proceeded to seize property at Nine Mile, National Capital District owned by Cloudy Bay Sustainable Forestry Ltd and has been taking steps to auction the property and apply the proceeds of sale to offset the judgment debt in WS 794 of 2014. It is the execution of that writ of levy of property that has been stayed by the orders of the National Court of 2 March 2023 in OS 3 of 2023 and OS 19 of 2023.
  4. There are applications for leave to appeal against the interlocutory judgments of the National Court in each of the OS proceedings:
  1. The applicants maintain that leave to appeal is necessary because of s 14(3)(b) of the Supreme Court Act. Section 14 states:

(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.


(2) An appeal does not lie from an order of the National Court made by consent of the parties.


(3) No appeal lies to the Supreme Court without leave of the Supreme Court—


(a) from an order allowing an extension of time for appealing or applying for leave to appeal; or


(b) from an interlocutory judgement made or given by the National Court except—


(i) where the liberty of the subject or the custody of infants is concerned; or

(ii) in cases of granting or refusing an injunction or appointing a receiver; or

(iii) in such other cases prescribed by the Rules of Court as are in the nature of final decisions; or


(c) from an order of the National Court as to costs only that by law are left to the discretion of the National Court.


(4) An order refusing unconditional leave to defend an action shall not be deemed to be an interlocutory judgement.


  1. The respondents argue that, though the order of 2 March 2023 in each of the OS proceedings was an interlocutory judgment, the National Court granted an injunction. Leave is not required when an injunction is granted, for the reasons explained by the Supreme Court in Ramu Nico Management (MCC) Ltd v Tarsie [2010] 1 PNGLR 88. The respondents argue that in such cases s 14(3)(b)(ii) applies:

No appeal lies to the Supreme Court without leave of the Supreme Court ... from an interlocutory judgement made or given by the National Court except ... in cases of granting or refusing an injunction.


  1. If it is ruled that the leave applications are unnecessary, both SCA 34 and 35 of 2023 ought to be summarily dismissed as incompetent, the respondents argue.
  2. The applicants and respondents also put arguments on whether each application should be granted if the applications were not summarily dismissed.
  3. The following issues arise:
  4. Is the interlocutory judgment of 2 March 2023 in each of the OS proceedings an injunction?
  5. If yes, should SCA 34 and 35 of 2023 be summarily dismissed?
  6. If no, is leave to appeal required?
  7. What criteria apply when deciding whether to grant leave?
  8. Should leave be granted?

1 Was the interlocutory judgment of 2 March 2023 in each of the OS proceedings an injunction?


  1. No. The interlocutory judgment was not an injunction, but a stay of execution of a judicial process.
  2. An injunction and a stay are distinct and separate types of court orders (Kaupa v Poraituk (2008) SC955, Kalinoe v Paraka (2010) SC1024, Makeng v Timbers (PNG) Ltd (2008) N3317). That the order of 2 March 2023 in each of the OS proceedings is not an injunction is readily apparent from the terms of the order, expressed as a stay of execution of the writ of levy of property in WS 794 of 2014. What was sought in each notice of motion was a stay, not an injunction. What was granted was a stay, not an injunction.

2 If yes, should SCA 34 and 35 of 2023 be summarily dismissed?


  1. If it were the case that that each judgment was a case of an injunction, the applications for leave and the proposed appeal in each case would have been dismissed as incompetent.
  2. This issue was resolved, following a period when there were conflicting lines of authority, by two decisions of the Supreme Court constituted by the same five Judges (Cannings J, Manuhu J, Gabi J, Hartshorn J, Yagi J) delivered on the same day, 6 December 2011: Punagi v Pacific Plantation Timber Ltd [2011] 2 PNGLR 92 and Joseph v Sereva (2011) SC1152. It was held that an unnecessary leave application is incompetent and must be dismissed.

3 If no, is leave to appeal required?


  1. Yes. The interlocutory judgments of 2 March 2023 did not fall into any of the exceptions in s 14(3)(b) of the Supreme Court Act. Leave to appeal is necessary and is properly before the court.

4 What criteria apply when determining whether to grant leave?


  1. Counsel for the applicants, Mr Sheppard, and counsel for the respondents, Mr Zazeng, each presented well researched and helpful submissions, highlighting the Supreme Court cases that address the criteria to apply when deciding whether to grant leave to appeal against an interlocutory judgment of the National Court.
  2. The applicant must at least demonstrate an arguable case of error of fact or law on the part of the National Court.
  3. Once an arguable case is demonstrated, other considerations to take into account include:

(See generally Pato v Manjin [1999] PNGLR 6, Chan v Ombudsman Commission [1999] PNGLR 240, Oberia v Charlie (2005) SC801, Liu v Emoto (2009) SC1032, Mirupasi v Bonou (2009) SC1049.)


5 Should leave be granted?


  1. The applicants in each matter have demonstrated an arguable case that to order in OS proceedings, a stay of execution of the writ of levy of property issued in unrelated and resolved WS proceedings, in circumstances where the rights of appeal of the respondents in connexion with the judgment of the National Court in those WS proceedings have been exhausted, was an error of law.
  2. There appear to be exceptional circumstances and clear legal grounds warranting the grant of leave. There is a reasonable argument that the National Court made a jurisdictional error in granting a stay of the writ of levy of property. Though it was open to the applicants to apply to the National Court to set aside the interlocutory judgments, a substantial injustice to the applicants is apparent. Good cause has been shown for interrupting the trial processes in the National Court.
  3. Furthermore there is an arguable case that given the circumstances in which the OS proceedings were commenced (an apparent attempt to challenge the validity of the WS proceedings and to circumvent compliance with orders of the National Court that had survived an appeal to the Supreme Court) and where the OS proceedings seemingly involve a multiplicity of proceedings, and where there is no cause of action clearly apparent on the face of each originating summons, each OS proceeding is an abuse of process, and susceptible to summary dismissal.
  4. It follows that leave will be granted in each case.

COSTS


  1. As the question of leave to appeal has been disputed, costs will follow the event, irrespective of the outcome of each appeal.

ORDERS


SCA 34 of 2023


(1) The application for leave, filed 10 April 2023, to appeal against the interlocutory judgment of the National Court of 2 March 2023 in OS 3 of 2023, whereby the Court granted a stay of execution of the writ of levy of property issued on 25 November 2022 in WS 794 of 2014, is granted.

(2) The respondents shall pay the applicants’ costs of the application on a party-party basis, which shall if not agreed be taxed.

(3) The applicants shall file a notice of appeal in accordance with Order 7 rule 6 of the Supreme Court Rules 2012.

SCA 35 of 2023


(1) The application for leave, filed 10 April 2023, to appeal against the interlocutory judgment of the National Court of 2 March 2023 in OS 19 of 2023, whereby the Court granted a stay of execution of the writ of levy of property issued on 25 November 2022 in WS 794 of 2014, is granted.

(2) The respondent shall pay the applicant’s costs of the application on a party-party basis, which shall if not agreed be taxed.

(3) The applicant shall file a notice of appeal in accordance with Order 7 rule 6 of the Supreme Court Rules 2012.

__________________________________________________________
Young & Williams Lawyers: Lawyers for the Applicants
Lakakit & Associates Lawyers: Lawyers for the Respondents


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