N962

PAPUA NEW GUINEA
[NATIONAL COURT OF JUSTICE]

AKIPA AND OTHERS

V

LOWA AND OTHERS

Waigani
Kapi DCJ

6-7 December 1990

PRACTICE AND PROCEDURE - Pleading - Pleading the "general issue" - Distinguished from general denial of pleaded facts - National Court Rules, O 8, rr 21(2), 28.

The National Court Rules, relevantly provide:

O 8, r 28 — "A party shall not plead the general issue".
O 8, r 21(2) — "A traverse may be either by a denial or by a statement of non-admission, and either expressly or by necessary implication, and either generally or as to any particular allegation".

Held

(1) The prohibition on pleading the "general issue" in O 8, r 28, is not a prohibition on pleading a general denial of pleaded facts, which is permitted under O 8, r 21(2); it is a prohibition on stating a conclusion (viz, "not indebted" or "not liable") from denials which are not pleaded as matters of fact.

South Pacific Developments Pty Ltd v Rudenno (1968) 88 WN (Pt 1) (NSW) 538; [1968] 2 NSWLR 716, followed.

Hornibrook Constructions Pty Ltd v Kawas Express Corporation Pty Ltd [1986] PNGLR 301, not followed.

(2) A defence which denied matters of fact alleged in the plaintiffs claim did not plead the "general issue" within the meaning of O 8, r 28.

Cases Cited

Hornibrook Constructions Pty Ltd v Kawas Express Corporation Pty Ltd [1986] PNGLR 301.
Moore Road Machinery (NSW) Pty Ltd v Sourry (1960) NSWR 227.
South Pacific Developments Pty Ltd v Rudenno (1968) 88 WN (Pt 1) (NSW) 538; [1968] 2 NSWR 716.

Motion

This was an application on notice seeking to strike out certain defences to a statement of claim.

Counsel

J Reeve, for the plaintiffs.
P Lowing, for the fourth and sixth defendants.
Cur adv vult

7 December 1990

KAPI DCJ: By a notice of motion, filed 3 December 1990, the plaintiffs sought to strike out the defence of the fourth defendant and the sixth defendant.

The grounds relied upon for both defences are the same. In essence the objection is that both defences offend the terms of O 8, r 28 of the National Court Rules:

"A party shall not plead the general issue".

I considered the application of this rule in the case of Hornibrook Constructions Pty Ltd v Kawas Express Corporations Pty Ltd [1986] PNGLR 301.

I applied the rule without interpreting the meaning of the words "general issue". I propose to do that in this case. In the end result I may differ in the application of this rule.

The Rules do not define the nature of what is a "general issue".

There are no cases directly on point which may guide me in interpreting the precise nature of what is a "general issue".

It would appear from my earlier decision that a general denial of a fact could amount to pleading a "general issue".

My attention was not drawn to the terms of O 8, r 21(2) of the Rules which provides:

"A traverse may be either by a denial or by a statement of non-admission, and either expressly or by necessary implication, and either generally or as to any particular allegation."

This rule deals with denial of fact either general or specifically. That rule on the face of it would be in conflict with the ruling in the earlier case in that the defence pleaded a general denial of fact.

If O 8, r 21 permits a denial of a fact generally (which it does) then an interpretation should be given to r 28 which does not conflict with r 21. It is a principle of statutory interpretation to construct the provisions of an Act so as to harmonise with one another.

The first point I note about r 28 is that it is not a prohibition on pleading a general fact. If that were so that would be in direct conflict with r 21. The term "general issue" must mean something different.

In Moore Road Machinery (NSW) Pty Ltd v Sourry (1960) NSWR 227, Jacobs J traced the history of pleading the general issues. This case involved a consideration of a point of pleading arising under O XXX, r 16 and r 18 of the Supreme Court Rules 1952 (NSW), as amended. These rules provide as follows:

Rule 16—"To causes of action to which the plea of ‘never was indebted’ is applicable, as provided in the Third Schedule to the Common Law Procedure Act 1899 (NSW), and to those of a like nature ... the plea of ‘never was indebted’ will operate as a denial of those matters of fact from which the liability of the defendant arises.

For example: In actions for goods bargained and sold, or sold and delivered, the plea will operate as a denial of the bargain and sale, or sale and delivery, in point of fact; in the like action for money had and received, it will operate as a denial both of the receipt of money and the existence of those facts which make such receipt by the defendant a receipt to the use of the plaintiff."

Rule 18—"Whenever a plaintiff proceeds by writ of summons specially indorsed under section 24 of the Common Law Procedure Act 1899 ... a plea in denial must deny such matters of fact, from which the liability of the defendant is alleged to arise, as are disputed.

For example: In actions for goods bargained and sold or sold and delivered, the plea must deny the order or contract, the delivery or the amount claimed; in an action for money had and received it must deny the receipt of the money, or the existence of those facts which are alleged to make such receipt by the defendant a receipt to the use of the plaintiff."

Rule 16 was rescinded in 1957 and the issue was whether the plea of "never indebted" was still a good plea where the defendant seeks to put in issue the facts upon which the plaintiff relies in order to establish his right. Jacobs J (at 233) concluded:

"Therefore I consider that the plea of never indebted puts in issue all facts upon which the plaintiff relies to establish the defendants’ liability. Therefore it complies with the requirement of r 18. It follows therefore that in my opinion it is a good plea. The effect of r 18 is not to make the simple plea of ‘never indebted’ impermissible, but is to enable a defendant, if he does not wish to traverse all the facts upon which the plaintiff relies, to select amongst them and to plead accordingly."

However, in the case of South Pacific Developments Pty Ltd v. Rudenno (1968) 88 WN (Pt 1) (NSW) 538; [1968] 2 NSWR 716, the Court of Appeal did not follow Jacobs J in the Moore Road Machinery case. Sugerman AP dealt with the same issue in these terms (at 539; 717):

"While r 16 stood in O XXX the position was reached by a series of decisions of judges in chambers that a plea of never indebted without more complied with r 18, because of the effect given to such a plea by r 16, whereby it operated as a denial of those matters of fact from which the liability of the defendant arose. See Johnson v Leeton Co-operative Cannery Ltd (1956) 73 WN (NSW) 532 (Myers J); Divola v Whalen (1957) 74 WN (NSW) 433 (Ferguson J); Chesterfield Casing Pty Ltd v Roche (1957) 75 WN (NSW) 93 (Walsh J); see contra White River Timber Co Pty Ltd v Yagoona Timber & Hardware Co Pty Ltd (1956) 74 WN (NSW) 276 (Richardson J). In the latest of these cases, Walsh J said (at 95):

‘I reach this conclusion with some regret. I feel little doubt that when r 18 was introduced, it was, in fact, intended that a defendant to an action in which the writ was specially indorsed should no longer be at liberty to make a blanket denial of the facts. Such pleas must be verified by affidavit, and I think it was intended that a defendant should be required to be specific as to which of the various factual ingredients of the cause of action he was prepared to deny on oath. The decision I am now making frustrates that intention, and, indeed, I think it has the effect of making r 18, for all practical purposes, inoperative. This difficulty was not overlooked by Ferguson J, who nevertheless held that, upon the language used in the rules, the plea of never indebted is permissible.’

In my opinion it is impossible not to agree with this view or to come to any other conclusion than that when r 16 of O XXX was rescinded, shortly after the decision of the Chesterfield Casings case, this was by way of giving further effect to the intention stated by Walsh J by removing the ground upon which the decisions which I have cited had rested."

At 540-541; 718, Sugerman AP, after referring to r 18 continues:

"This, it will be observed, is mandatory in its terms. A plea in denial, in the circumstances stated, must, then, deny matters of fact; and examples are given in the rule which make this perfectly clear. But the words, ‘that he never was indebted as alleged’, stripped of the operation formerly given to them by the rescinded r 16, do not deny any such matters as are mentioned in r 18 or, for that matter, any matters of fact at all. Their function in that respect was purely a conventional or artificial one given to them by r 16 as the culmination of a history of the course of pleading the general issue which Jacobs J very carefully traced out in the Moore Road Machinery case. In themselves they merely state a conclusion from denials which are not stated.

Reluctant as I am to differ from any considered opinion of Jacobs J, I do not think that his decision in the Moore Road Machinery case should be followed in this Court. It seems to me that the changes which have been made in the rules mark a still further stage in the history of the pleading of ‘never indebted’ which failed of effect when all that was done was to insert O XXX r 18, but has succeeded now that that is accompanied by the rescission of r 16. I am of the opinion that the intention referred to by Walsh J, in the passage which I have just quoted from his judgment in the Chesterfield Casings case has at last been effectuated."

This is the background to the present rule in the New South Wales, O 15, r 27, which is the equivalent of our O 8, r 28 of the National Court Rules.

I conclude from the cases I have referred to that pleading the general issue in defence is a plea which to use the words of Sugerman AP in the Rudenno case, "merely state a conclusion from denials which are not stated". For example: In an action for goods bargained and sold or sold and delivered, the plea in defence must deny the order or contract, the delivery or the amount claimed. To plead that the defendant "is not liable" or was "never indebted" is a conclusion which does not state the facts upon which such a conclusion is reached. However, where the statement of claim pleads facts upon which the cause of action is based such as existence of an order or contract, the delivery or amount claimed in an action for goods bargained and sold or sold and delivered, a mere denial of these facts either generally or specifically is permissible under O 8, r 21(2) of the National Court Rules. Such a plea in my view does not offend O 8, r 28 of the Rules.

I have examined the defence of the fourth and the sixth defendants and they simply deny matters of fact alleged in the plaintiffs statement of claim. This is permissible by O 8, r 21(2), of the National Court Rules and they do not plead a "general issue" within the meaning of that term under O 8, r 28, of the National Court Rules. I dismiss the application.

Application dismissed

Lawyers for the plaintiffs: Warner Shand.
Lawyers for the fourth and sixth defendants: Gadens Ridgeway.