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Anio v Baliki [2002] PGNC 73; N2267 (26 August 2002)

N2267
PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE AT WAIGANI]

OS NO. 59 OF 2002

BETWEEN:

PAMA ANIO
Plaintiff/Applicant

AND:

AHO BALIKI
Chief Executive Officer of the Papua New Guinea Banking Corporation
First Defendant/Respondent

AND:

PAPUA NEW GUINEA BANKING CORPORATION
Second Defendant/Respondent

Waigani: Davani, .J
2002: August 23, 26

MASTER AND SERVANT – Action for wrongful dismissal – Injunctive relief sought – No jurisdiction in respect of contract or wages – Jurisdiction with respect to ancillary matters – Principles applicable – Action effective election to accept repudiation of contract – Damages adequate remedy – No discretionary grounds on which injunction might go.

INJUNCTIONS – Interlocutory injunctions – When available – Preservation of status quo – Justice and convenience – Discretion to refuse – Action for wrongful dismissal – Damages adequate remedy – Injunction not granted.

Counsel:
A. Mana for the Defendants/Respondents
L. Manoa for the Plaintiff/Applicant

26 August 2002

RULING

(Application for injunctive Orders)

DAVANI .J: This is an application by the Plaintiff/Applicant (‘Applicant’) for orders to restrain the First and Second Defendants/Respondents (‘Respondents’) from evicting, removing or ejecting the Applicant and his family from Allotment 13 Section 256, Hohola. The Respondent opposes the application.

The Applicant relies on an affidavit sworn on 25th June 2002 in support of this application.

Background

By way of background, the Applicant deposes that he was formerly employed by the second defendant as an assistant manager, Multi Media. His employment was governed by an Employment Agreement executed on 20th October 1999. On or about early May 2000, whilst in the second defendant’s employ, the Applicant applied for a fully drawn loan under the second defendant’s staff housing loan to purchase the house he currently resides in located at L. 13 S. 256 Hohola (Gerehu) (the ‘Property’). This loan was approved, the terms of which were that the Applicant would purchase the Property at K135,518.00 to be repaid over a period of 20 years. Security for the loan was a registered First Mortgage and Fire Policy Assignment by the Applicant over the Property. There is also an irrevocable order over the Applicant’s fortnightly housing allowance which, under the Applicant’s Contract with the second defendant was K223.60 per week or K11,626.00 per annum.

The Contract was to commence on 27 October 1999 and expire on 26 October 2002. The Applicant was summarily terminated for cause by the second defendant on 24 December 2001, 10 months before his contract with the Respondent was to expire. By letter of 13 February 2002, the second defendant advised the Applicant that upon his termination from its employ, it would cease its housing scheme benefits which therefore meant that the Applicant would have to repay the outstanding balance in monthly instalments of K1,693.00 to commence on 13th March 2002 over the remaining 15 years. As at 13th February 2002, the Applicant’s account was in arrears of K182.47. By letter of 25 April 2002, the second defendant requested the Applicant to provide an update of his earnings by 30th April 2002, i.e his "personal statement of earnings" and a "fresh balance sheet position". The Applicant advised the second defendant by letter of 29th April 2002 that he had instituted legal proceedings against it and that he wanted to repay the loan from a portion of his present fortnightly salary of K600.00. He also advised the defendant bank that he would not hesitate to seek a court order should the bank proceed with recovery. He had however, prior to that, filed court proceedings on 22.1.02.

The Respondent as Mortgagee

Can the Applicant ask the court to restrain the defendant bank from exercising its powers as Mortgagee?

In this case, the Applicant claims he has a good case in that the termination of his services by the Defendant Bank was unlawful. Therefore, the court must restrain the Bank from exercising its powers as mortgagee until the substantive case is dealt with. Applicant’s counsel has not submitted to the court any case on point that in situations of this nature, the bank should not exercise its power of sale. The law relating to the Mortgagor, in this case the Applicant, is that "...he continues to be bound by the terms of the mortgage agreement notwithstanding a change in his personal circumstances..." (see Bank of Papua New Guinea v Muteng Bapa [1972] PNGLR 271 at 273). The facts in that case are similar to this case in that the Defendant obtained a staff loan at a concessional rate until his resignation when his loan repayments ceased. The Defendant in that case argued that the bank’s decision to foreclose was unreasonable considering the Defendant’s livelihood, that his recent unemployment had adversely affected his ability to service the loan and seek refinancing. The court held that this argument was not available to the Defendant, that he continued to be bound by the terms of the mortgage. That is the case here. The Applicant cannot expect that the Bank will not exercise its powers as Mortgagee when he has defaulted.

The Applicant in seeking interlocutory injunctions, must prove the balance of convenience, to maintain the status quo and that there is a serious question to be tried. As alluded to earlier, the Applicant’s lawyer did not make any submissions on why and when an injunction can issue in this case.

In relation to whether there is a serious question to be tried, I note the Applicant’s claims that the proper procedures were not followed by the second defendant when effecting the termination. On the material read, it is difficult to determine because of paucity of evidence. However, they do raise the issue that these are or may be serious questions.

In relation to the second principle, the balance of convenience, here the inquiry is "whether the inconvenience or injury which the Plaintiff would be likely to suffer if an injunction were refused outweighs or is outweighed by the injury which the Commission would suffer if an injunction were granted" (see National Airline Employees Association v Air Niugini (No. 2) [1992] PNGLR 291 at 294). It is here that the Applicant’s case flounders, for I follow the decision on similar facts by this court in Robinson v National Airlines Commission [1983] PNGLR 476. There the court reiterated these principles;

The headnote of that case reads;

"an interlocutory injunction, the purpose of which is to preserve the status quo, will be granted where just and convenient. The plaintiff must prove that he has a serious, not a speculative case, which has a real possibility of ultimate success and that he has a legal or equitable right, title or interest which might be jeopardised if the injunctive relief were not granted: it is then for the court to determine whether nonetheless the injunction should not go taking into account such factors as the adequacy of damages as a remedy, the possibilities of alternative remedies, whether there has been any laches or delay, the strength of the grounds of defence, what if any undertakings the defendant is prepared to give and most importantly, hardship and the balance of convenience".

The Trial Judge Andrew .J then said at pg 481 of Robinson (supra);

"The servant cannot claim specific performance of the Contract of Employment. Nor can he claim wages as such after the relationship has determined. He is left to his remedy in damages against the master for breach of the Contract to continue the relationship for the contractual period."

In this case, and on the relative strength of parties cases and the Applicant’s claims of wrongful termination, these cannot of themselves, force the bank to abandon its powers as Mortgagee.

Further, the Applicant should have given an undertaking as to damages before the court entertains an application which will affect his proprietary rights. Here the Bank is mortgagee, therefore the Applicant’s right to occupancy is permissive, at the Bank’s option in or where there are instances of default. No undertaking as to damages has been given. That then, does not convince me to exercise a discretion which would adversely affect the Mortgagees rights to foreclose and exercise its power of sale, if it intends to do that.

The law does not allow for the issuing of an injunction. I have not been persuaded otherwise.

As such the motion is dismissed. Costs of appearance are awarded to the Defendants.
_____________________________________________________________________
Lawyer for the Applicant : Harricknen Lawyers
Lawyer for the Respondent : Allan Arthur Robinsons