N2499

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

WS. NO. 309 OF 1994

LEPANDING SINGUT
Plaintiff

AND:

KELLY KINAMUN
First Defendant

AND:

ALBO ENTERPRISES PTY LTD
Second Defendant

AND:

FEDELIS AGIN
Third Defendant

AND:

PAPUA NEW GUINEA BANKING CORPORATION
Fourth Defendant

AND:

PAUL PIRU
Fifth Defendant

AND:

JOHN KIL
Sixth Defendant

WAIGANI:		KANDAKASI, J.
2003:	26th August & 17th December

PRACTICE & PROCEDURE – Death of an intestate party intestate – Application for substitution of – Time limit for making such an application – Application must be made within time limits or within such time as the Court considers appropriate - Non compliance of time limit not critical – Court has power to waive strict compliance to do substantive justice – Factors to consider before exercise of discretion include the mechanics of establishing the claim or the defence as the case might be, availability of witnesses and evidence and prejudice to the other parties - O. 4 rr. 10 & 11 National Court Rules.

PRACTICE & PROCEDURE - Application to dismiss for want of prosecution – Principles governing – Once applicant makes out a prima facie case respondent obliged to rebut it with satisfactory explanation and demonstrate preparedness to take the next step – No explanation for failure to prosecute prior to plaintiff’s death – Application for dismissal granted – O. ,r. of the National Court Rules. 

PARTIES & CAUSES OF ACTION - Death of an intestate party – Survival of causes of action – Claim based on fraud survives death of a party - Capacity of Public Curator to apply for substitution of deceased party – Public Curator does have the statutory right and power to substitute the intestate deceased party if the cause of action survives – s. 34 of Wrong (Miscellaneous Provisions) Act - s. 10 Public Curators Act – O.4 rr.10, 11 & 12.

Papua New Guinean Cases Cited:
Application Pursuant to s155(4) by John Mua Nilkare (Unreported judgment delivered 5/04/97) SC536.
Rabaul Shipping Limited v. Rita Ruru (Unreported judgment delivered 08/12/00) N2022.
Thomas Kaidiman v. Papua New Guinea Electricity Commission (Unreported judgement delivered 20/05/02) N2343.
Public Officers Superannuation Fund Board v Sailas Imanakuan (Unreported judgement delivered on 09/11/01) SC677.
The Donigis v. PNGBC (Unreported judgement delivered on 02/11/01) SC691.
Vivisio Seravo v. Jack Bahafo (Unreported judgement delivered on 21/03/01) N2078.
Papua New Guinea Banking Corporation (PNGBC) v. Jeff Tole (Unreported judgement delivered on 27/09/02) SC694.

Counsel:
Mr. T. Dawidi for the Applicant
Mr. P. Parkop for the First Defendant/Respondent.

17th December 2003

KANDAKASI, J:	Before the Court are two notices of motion. One of them is by the Public Curator seeking to substitute the plaintiff who is now deceased. The other is by the first defendant seeking a dismissal of the proceedings for want of prosecution. The motion to dismiss for want of prosecution was filed ahead of the application for substitution. Indeed, the later one triggered the former application. Both motions initially came before me for hearing on 26th August 2003. But I directed the parties to file written submissions for my consideration and a decision when I am in a position to deliver it. The parties have filed their respective submissions and this is the Court’s decision. 

Based on the preliminary representations of the parties, I noted that the issues before the Court were these:

1.	Whether the Plaintiff’s cause of action has survived his death?
2.	If the cause of action survived then, is the Public Curator entitled to substitute the now deceased plaintiff? and
3.	Whether, there has been undue delay in the prosecution of the Plaintiff’s claim so as to warrant dismissal of the proceeding for want of prosecution rather than a substitution.

If the Court finds that the cause of action did not survive the deceased, then it would not be possible for the Public Curator to substitute the deceased. That could end the case there. Hence, it would render unnecessary any consideration of the remaining issues. I will therefore consider each of these issues in the order in which they appear. 

The Facts

The factual background from which these issues arise are simple and straight forward. In 1994, these proceedings were commenced. They concerned a property located at Section 268 Allotment 43, Hohola, NCD., which was the subject of a sale and or rental purchase. In the statement of claim, the deceased claimed the second and third defendants breached a fiduciary duty owed to him by them and that was by a conspiracy to defraud him by the first Defendant. He therefore sought various orders including an account for profit allegedly made by the first, second and third defendants from the sale and or purchase of the said property. He also sought a declaration that the first defendant is a constructive trustee, an order setting aside the relevant contract of sale and an order for damages.

Almost 7 years later, the deceased passed away in the year 2001. Neither the Court, nor the defendants were informed of the death of the deceased. But it was raised in response to the application seeking to dismiss the proceedings for want of prosecution. Not only that, the applicant did not make his application for substitution of the plaintiff now deceased within the 3 months as required by O. 5, r. 10 of the National Court Rules. Also the Public Curator did not have any idea about the death of the plaintiff until the relatives of the deceased requested him on 30th July 2003 to apply to substitute the deceased.

Other than the death of the deceased in 2001, there is no explanation for the delay of over 6 years following the issue of proceedings. Also there is no evidence of the steps, if any; the decease took to put his claim to trial prior to his death. Further, there is no indication as to the state of readiness now to put the matter to trial. Further still, there is no indication as to how the evidence for the plaintiff will be led if the matter was allowed to go to trial.

With this factual background in mind, I now turn to the issues before the Court, starting with the first issue first.

Survival of Cause of Action

The question of survival of a cause of action is critical to an application for substitution following the death of a party to a proceeding before the Court. This is because such an application can be entertained where the cause of action survives the deceased party. That is apparent from the wording in O.4, rr.10 (1) and 12. These provisions read:

"10.	Death, transmission, etc.

(1)	Where a party dies or becomes bankrupt but a cause of action in the proceedings survives, the proceedings shall not abate by reason of the death or bankruptcy."
…
"12.	Failure to proceed after death of party. (8/12)

(1)	Where—
(a)	a party dies but a cause of action in the proceedings survives his death; and
(b)	an order under Rule 10 for the addition of a party in substitution for the deceased party is not made within three months after the death,
the Court may, on application by a party or by a person to whom liability on the cause of action survives on the death, order that, unless, within a specified time after service of the order in accordance with Sub-rule (2), a party is added in substitution for the deceased party, the proceedings be dismissed so far as concerns relief on the cause of action for or against the person to whom the cause of action or the liability thereon, as the case may be, survives on the death.
(2)	On making an order under Sub-rule (1), the Court shall give such directions as it thinks fit for service of the order on the persons (whether parties or not) interested in continuing the proceedings."

(Emphasis added)

From this, it is very clear that in the case of a party to a proceeding dying before its conclusion, the party’s death does not bring an end to his cause of action, particularly where the cause of action is one which survives him. Hence the survival of a cause of action is a precondition to an application for substitution. Accordingly, it is necessary to identify what types of causes of actions survive the death of a party.

The Wrongs (Miscellaneous Provisions) Act addresses that question in section 34 (1) and (2) in so far as they are relevant. These provisions read:

"34.	Effect of death on certain causes of action.

(1)	Subject to this section, on the death of a person after 1 January 1963 (being the date of commencement of the pre-Independence Law Reform (Miscellaneous Provisions) Act 1962) all causes of action subsisting against or vested in him survive against or for the benefit of, as the case may be, his estate.

(2)	Subsection (1) does not apply to causes of action for defamation or seduction or for inducing one spouse to leave or remain apart from the other, or to claims for damages on the ground of adultery."
							(Emphasis added)

These provisions are so plain that they leave no room for argument as to what kind of causes of action survives the death of a person. It is settled law that where the language used by Parliament in any legislation is so plain and clear as to its intent and purposes, they should be allowed to speak for themselves. I find that is the case here. Section 34 (1) makes it clear that, as from the 1st of January 1963 all causes of action survive the death of a person. The only exception to that are those matters that are mentioned in subsection (2). The exception list is made up of defamation, seduction or for inducing one spouse to leave or remain apart from the other, or to claims for damages on the ground of adultery. 

The cause of action in this case is one based on breach of a fiduciary duty as well as a claim based on conspiracy to defraud the plaintiff now deceased. There is correctly no argument between the parties that the cause of action here is not caught by the provisions of s.34 (2) of the Wrong (Miscellaneous Provisions) Act. Accordingly, I have no difficulty in finding that the cause of action in this matter survived the demise of the plaintiff.

Public Curator Substituting Intestate Party

The question then is, is the Public Curator the correct person or party to substitute the deceased? That is the subject of the second question. I therefore turn to that question now.

The Wills, Probate and Administration Act and the Public Curator Act govern the powers and functions of the Public Curator. Section 44 of the former provides for and vests in the Public Curator powers of administration in these terms:

"44.	Initial vesting in Public Curator.

Until probate or administration is granted, the property of a deceased person vests in the Public Curator, in the same manner and to the same extent as formerly personal estate in England vested in the Ordinary."

There is no contest that this provision applies in cases where a person dies with a will and one dying without a will. Likewise, there is no contest that this is only a temporary measure pending the grant of probate or administration of the estate of a deceased person. Where a person dies without a will s. 10 of the later Act empowers the Public Curator to apply for grant of probate or administration in these terms: 

"10.	Orders to Administer.

(1)	On the application of the Public Curator, the National Court or a Judge may grant to the Public Curator an order to administer the estate of any deceased person having property within the jurisdiction where –

(a)	the deceased left no executor, widow, widower or next of kin resident within the jurisdiction, who is willing and capable of acting in the execution of the will or the administration of the estate; or 
(b)	the executors named renounce probate of the will of the deceased, and all the person primarily entitled to administration decline, by instrument filed with the Registrar, to apply for administration; and 
(c)	probate or administration is not applied for within three months after the death of the deceased; or 
(d)	after the expiration of 30 days after the death, there is no reasonable probability of application being made within the period of three (3) months after the death; or 
(e)	the estate or any portion of the estate is liable to waste, and the executor, widow, widower or next of kin –
i.	is absent from the locality of the estate; 
ii.	or is not known; or 
iii.	has not been found; or 
iv.	requests the Public Curator in writing to apply for the order; or 
(f)	the estate or any portion of the estate, is-
i.	of a perishable nature; or 
ii.	in danger of being lost or destroyed; or 
iii.	great expense may be incurred by any delay.

(2)	The National Court or a Judge may – 
(a)	before granting the order applied for under Subsection require the Public Curator -
i.	to give such notices; 
ii.	or to cite such persons; or 
iii.	to produce such evidence, as the Court or Judge thinks proper; or 

(b)	Make a temporary order for collection and protection, only, or limited to a portion of the estate or otherwise.

(3)	Except as otherwise expressly provided, all laws referring to the administration of the estate of deceased persons apply to the administration of estates by the Public Curator."

The second defendant correctly, in my view, takes no issue that on the Public Curator’s powers under this provision to apply for grant of probate or administration of the deceased’s estate in this case. Then in the context of that power, the second defendant is also correctly not contesting that the Public Curator has the power to apply for a substitution of the deceased. The only point in contention however is that, that application should have been made within the 3 months limit stipulated under O.5, r. 10 of the National Court Rules. Further, he argues that the application should have been made independently and long before his application for a dismissal of the proceedings for want of prosecution was filed and or made. If that was done, he argues that he could have objected. But because the application for substitution was not brought on earlier, he was denied the right to object to the application. He therefore submits that the application for substitution should not be granted.

This requires a close examination of the provisions governing the substitution of a party following the death of an original party to the proceedings pending in court. In the foregoing, I already set out the relevant provisions and their wording. Hence, it is not necessary to restate them. However, proceeding on the basis of the wording in O.5, r.10 (1), it is clear that a cause of action, which survives the death of a party, is preserved by this provision. Nevertheless, this provision does not provide explicitly as to how the proceedings should be conducted. Rule 12 of the same Order appears to provide by implication an answer to this question, by providing for the consequence that should follow where there is a failure to substitute within three months from the date of the death of a party.

Injia J (now Deputy Chief Justice) in Thomas Kaidiman v Papua New Guinea Electricity Commission came to the same conclusion. His Honour observed at p. 4 that:

"… whilst Rule 10 & 12 do not expressly stipulate that an application under Rule 10 must be made within 3 months of the death of a party, it is implicit in Rule 12(i)(b) that a person who has an interest in the deceased’s estate is entitled to make such an application within 3 months of the death."

A closer examination of the provisions of Rule 12 makes it clear that the time limit of three months need not be observed strictly. There is discretion in the Court to either dismiss an action or to order that steps for a substitution take place within a specified period. The Supreme Court judgement in POSFB v. Sailas Imanakuan made it clear that an application for substitution can still be entertained by the Court in certain circumstances, even outside the 3 months limitation. In so doing, it noted that the obligation was placed on the opposing party in which the other dies and his cause of action survives. This was inferred from the words "the Court may, on application by a party or by a person to whom liability on the cause of action survives on the death" in O.5, r.12(1) and said:

"In our view, these words give a party who is liable on a cause of action which survives the death of a party to apply for a dismissal order if no application is made for substitution within a period of three months from the date of the death of the original party. When such an application is made, the Court is not obliged to dismiss the proceedings but may make orders requiring the deceased party to be replaced within a specified period after the service of the order. In other words, the Court could order a dismissal of an action on account of the death of a party but that is not automatic. Instead, it is conditional on a party not substituting the deceased party within a period to be specified by the Court."

The Court noted that in the case before it, although the appellant, POSF was aware of the death of the plaintiff in the National Court, it did not apply for a dismissal of the action. Instead, it allowed the husband of the deceased to continue to pursue the action until he applied for judgement in default of discovery. That is the only time POSF tried to apply for a dismissal of the proceedings and the deceased husband then applied to be substituted for his deceased wife. The National Court held that it had power under s. 155(4) of the Constitution to order the deceased to be substituted by her husband instead of dismissing the proceedings for a failure to apply for substitution within 3 months from the death of the plaintiff. This was to enable substantive justice to be done on the merits. 

The Supreme Court endorsed the National Court’s approached and said:

"We find nothing wrong with that. In any case, O.1 r.7 of the NCRs, compliments s. 155 of the Constitution by giving the Court the power to dispense with a non-compliance of the rules either before or after the need to do so has arisen in the interest of justice. It is now settled law that, the Rules of the Court are not an end in them but a means to an end in all matters going before the Courts. They are only a code of practice and there is no doubt where justice so requires, strict adherence to the rules can be dispensed with in the circumstances of a particular case."

There is ample authority for the proposition that, where discretion is vested in the Court or any other authority, it must be exercised on proper principles. Of course the need to do justice on the merits of the case is fundamental as demonstrated by the Supreme Court decision, just cited. Other considerations, such as the mechanics of establishing the claim in the case of a deceased plaintiff or a defence in the case of a deceased defendant, are in my view, relevant considerations. In this regard, whether the relevant witnesses and or the evidence are readily available and whether there will be any prejudice to the other side, are relevant factors for consideration as well before arriving at a decision in the exercise of the discretion vested in the Court. 

In Thomas Kaidiman v Papua New Guinea Electricity Commission the National Court decided to grant an application for substitution following the death of one of the parties to a proceeding. The Court was persuaded to arrive at that decision because the applicant was a heir to the deceased estate, who acted promptly once advised of her legal rights and that, the claim could easily be established by documentary evidence which was available.

In the present case, I accept the Public Curator’s submission that, he has the legal right and or power to act on behalf of the estate of the now deceased plaintiff who has died intestate. I also accept his submissions that, he has acted promptly as soon as he became aware of the death of the deceased. Unfortunately, however there is no evidence as to how he will be able to establish the case against the defendants. Also there is no evidence in support of the application that suggests that the relevant witnesses and or their evidences are intact and that he will have no difficulty producing them. 

I consider the lack of any evidence in relation to the availability of witnesses and or evidence on the matters in issue between the parties in the substantive proceedings is critical. It is critical because justice must be seen from the perspective of all the parties that are involved in a matter pending before the Court. Unless there is no contest between the parties, particularly in relation to the relevant facts, it is an important part of our justice system that a party is entitled and he must be given ample opportunity to test the evidence called against him or her by way of cross-examination. Hence, with one of the principle parties to a proceeding gone, it might be difficult to establish one’s case and or the other to test the credibility of his opponent’s evidence.

In the circumstances, whilst I find that the Public Curator has a statutory power and or authority to represent the estate of the plaintiff now deceased, I have nothing before me in relation to the mechanics of establishing the claim against the defendants. There is also nothing before me that demonstrates in one way or another that the defendants will not be denied their right of cross-examination of any witnesses and or rebut any witnesses and any evidence that might be called in support of the claim against them. Accordingly, I am not sufficiently persuaded to exercise the discretionary powers vested in this Court under O.5, r. 12(1).

There is an additional factor that persuades me not to exercise the discretion in favour of the application to substitute. This has to do with the long period of over 6 years that have lapsed since the issue of the proceedings prior to the plaintiff’s death. This I note has given rise to the application for want of prosecution. I thus consider it is appropriate to turn to that issue now.

Want of Prosecution

It is settled law that a plaintiff or an appellant in the case of an appeal is always under an obligation to prosecute his claim or appeal with due diligence and without delay. One of the latest judgments on want of prosecution in relation to a Supreme Court appeals is The Donigis v. PNGBC. There the Supreme Court said:

"Where an appellant fails to do any of the above [take the steps it is required to take under the Supreme Court Act or the Rules] or fails to duly prosecute his appeal, rule 53 gives a respondent the right to apply for a dismissal of the proceeding. The power to dismiss an appeal on an application such as this is a discretionary one. That discretion is usually exercised where there is a case of undue delay on the part of an appellant to prosecute his appeal without any satisfactory explanation for such a delay."

This case and others preceding it, provide authority for the proposition that, once an applicant for dismissal for want of prosecutions has established a case of want of prosecution, the burden then shifts to the respondent to such an application to rebut it. The respondents’ burden is then to satisfactorily explain the delay and demonstrate a readiness to take the next step in the proceeding and proceed without further delay. Where a respondent fails to discharge that onus, the Court is left with little or no choice but to grant the application to dismiss.

These principles apply quite specifically to Supreme Court appeals. In the case of National Court proceedings, similar principles apply but in the context of the relevant National Court Rules. In respect of that, I have summarised the principles in Vivisio Seravo v. Jack Bahafo in this way:

"It is now clear law especially in the context of O.10 r.5 of the NCRs that an application for a dismissal of proceedings for want of prosecution may be granted if:

1.	The plaintiff's default is intentional or is allowing for an inordinate and inexcusable delay in a prosecution of his claim;
2.	There is no reasonable explanation given by the plaintiff for the delay; and
3.	That the delay has caused injustice or prejudice to the defendant.

This is apparent from cases like that of Ronald Nicholas v Commonwealth Niugini Timbers Pty Ltd [1986] PNGLR 133 which has been followed in a number of other cases such as Umbu Waink & Anor v Motor Vehicles Insurance (PNG) Trust and The State (15/08/97) N1630." 

In the case presently before me, I note that the proceedings were commenced in 1994. About over 9 years have lapsed and the matter has not yet progressed to trial. Meanwhile, the plaintiff passed away in 2001, a fact that was not made known to the Court, the Defendants and the Public Curator until the application seeking to dismiss the proceedings for want of prosecution was filed and served. There is no indication of where the proceedings are at and when they will be put to trial. 

In these circumstances, I am satisfied that the second defendant applicant has established a case of want of prosecution. That being done, the onus was then placed upon the respondents to the application to provide a reasonable explanation for the delay and demonstrate no prejudice to the defendants by reason of the delay and his preparedness to put the matter to trial without further delay. There is not a single explanation for the years preceding the death of the plaintiff. Also, there is no indication as to whether the relevant witnesses and their evidences are intact despite the long passage of time. Further, there is no indication as to when the matter will be put to trial. Furthermore, there is no demonstration that the delay has not and will not result in any prejudice to the defendants in terms of conducting their defence to the claim.

Now with the death of the plaintiff, and in the absence of anything to the contrary, I am of the view that no useful purpose will be served if the proceedings were allowed to stand. The plaintiff will not be able to call any evidence in the absence of the principle, the deceased. This risk is strengthened by the lack of any explanation for the delay of over 6 years, which could in the main come from the deceased himself, in the absence of any evidence to the contrary. Given that, the defendant will be forced to incur costs it may not be able to recover from the deceased estate in the absence of any evidence of the means that are available to meet such costs. This is in addition to the risk of forcing the defendants to go to trial without an assurance over a grant of their rights to cross-examine and otherwise test the plaintiff’s evidence. Weighing all of these and other factors operating for and against allowing the proceedings to stand, in the interest of doing justice to all of the parties in these proceedings, I find that the factors warranting a dismissal out weighing a maintenance of these proceedings. Accordingly, I would order a dismissal of the proceedings for want of prosecution.

Summary

In summary, I find that the cause of action in these proceedings is on the basis of fraud and conspiracy in breach of a fiduciary duty. This cause of action is one that survives by reason of the provisions of s.34 (1) and (2) of the Wrong (Miscellaneous Provisions) Act. Then since the plaintiff is now died intestate, the Public Curator has the ultimate power and or authority to represent the estate of the deceased. As such, he is entitled to apply to be substituted for the now deceased plaintiff. However, he has not made out a case in terms of how he is able to establish the claim against the defendants with an accommodation of the defendant’s right to cross-examine witnesses and otherwise test the claim against them. This is complicated by the fact that the claim has not been prosecuted with due diligence and without delay, something the Public Curator or anybody else is not able to explain satisfactorily. In these circumstances, the interest of justice will be served by an order dismissing the proceedings with costs to the first defendant for two main reasons. The first reason is the death of the deceased with no good case being made out for a substitution. The second reason is for want of prosecution since the issuance of the proceedings prior to the death of the deceased which has not been satisfactorily explained with an indication to now take the required steps without delay.

I therefore grant the application to dismiss these proceedings. Accordingly, I order a dismissal of the proceedings with costs against the applicant and the estate of the deceased.
________________________________________________________________________
Lawyers for the Applicant/Respondent:		Pato Lawyers
Lawyers for the First Defendant/Respondent:		Parkop Lawyers