N5351 

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

WS 1462 OF 2005

BETWEEN:

TERRY WAPA
First Plaintiff

AND:

PEPI KIMAS
as Secretary for Department of Lands & Physical Planning
First Defendant

AND:

THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Second Defendant

Waigani: Hartshorn J.
2008: 9th October,
2009: 16th February

ASSESSMENT OF DAMAGES – Wrongful termination of employment – Liability not in issue 
 
Cases cited: 
Papua New Guinea Cases

Ereman Ragi & Anor v. Maingu (1994) SC459
Keith Reid v. Murray Hallam and Allcad Pty Ltd (1995) N1337 
Andale More and Manis Andale v. Henry Tokam and The State (1997) N1645 
Nazel Zanepa v. Ellison Kaivovo & Anor (1999) SC623 
Coecon Ltd (Receiver/Manager Appointed) v. National Fisheries Authority (2002) N2182 
Papua New Guinea Banking Corporation v. Jeff Tole (2002) SC694 
Desmond Huaimbukie v. James Baugen (2004) N2589 
Boinamo Enterprises Ltd v. Michael Carey (2004) SC744 
Pama Anio v. Aho Baliki (2004) N2719
William Mel v. Coleman Pakalia & Ors (2005) SC790 

Overseas Cases

Addis v. Gramophone Co Ltd [1909] AC 488
Johnson v. Unisys Ltd [2001] 2 All ER 801

Counsel:
 
Mr. M. Nandi, for the Plaintiff

16th February, 2009

1. HARTSHORN J: Mr. Terry Wapa claims damages from the defendants for wrongful termination of his employment as the Provincial Lands Manager for the Southern Highlands Province.

2. Mr. Wapa's employment was terminated in August 1994 some 9 months after being served with disciplinary charges. In August 2002 the Public Service Commission found that the termination was flawed and recommended that Mr. Wapa be reinstated without loss of entitlements.

3. Mr. Wapa was reinstated into the Public Service but as an unattached officer. He has been paid his lost wages but no other entitlements.

4. Default judgment was entered for Mr. Wapa with damages to be assessed. Consequently the hearing before me was for an assessment of damages. Counsel for Mr. Wapa relied upon affidavits filed by Mr. Wapa. He also filed written submissions.

Assessment of damages – law

5. The Supreme Court in William Mel v. Coleman Pakalia & Ors (2005) SC790 stated:

"The principles that apply to a trial on assessment of damages following entry of default judgment were summarised by Kandakasi J. in Coecon Ltd (Receiver/Manager Appointed) v National Fisheries Authority (2002), National Court, N2182.

His Honour stated:

A survey of the authorities on assessment of damages after entry of judgment on liability mainly in default of a defendant's defence, clearly show the following:

1. The judgment resolves all questions of liability in respect of the matters pleaded in the statement of claim.

2. Any matter that has not been pleaded that is introduced at the trial is a matter on which the defendant can take an issue on liability.

3. In the case of a claim for damages for breach of contract as in this case, such a judgment confirms there being a breach as alleged and leaves only the question of what damages necessarily flow from the breach.

4. The plaintiff in such a case has the burden to produce admissible and credible evidence of his alleged damages and if the Court is satisfied on the balance of probabilities that the damages have been incurred, awards can be made for the proven damages.

5. A plaintiff in such a case is only entitled to lead evidence and recover such damages as may be pleaded and asked for in his statement of claim.

The Supreme Court adopted and applied those principles in Papua New Guinea Banking Corporation v Jeff Tole (2002) SC694, Amet CJ, Sheehan J, Kandakasi J.

Kandakasi J. applied those principles recently in the National Court in Desmond Huaimbukie v James Baugen (2004) N2589. We believe His Honour succinctly and correctly stated the law. We elaborate on the first principle by saying that once default judgment is entered, the facts as pleaded and their legal consequences in terms of establishing the cause of action as pleaded must be regarded as proven. (See Keith Reid v Murray Hallam and Allcad Pty Ltd (1995) N1337, National Court, Kapi DCJ and Andale More and Manis Andale v Henry Tokam and The State (1997) N1645, National Court, Injia J.)….....................

Turning back to the issue raised above as to the role of the trial judge after entry of default judgment, we consider the following to be the correct approach: the trial judge should make a cursory inquiry so as to be satisfied that the facts and the cause of action are pleaded with sufficient clarity; if it is reasonably clear what the facts and cause of action are, liability should be regarded as proven; only if the facts or the cause of action pleaded do not make sense or would make an assessment of damages a futile exercise should the judge inquire further and revisit the issue of liability."

The claim

6. From a perusal of the statement of claim it appears that the facts are pleaded sufficiently clearly for the cause of action to be determined as being for wrongful termination of employment. The State is liable for the acts of its employees.

Damages

7. I now must determine whether Mr. Wapa has sufficiently proved the damages he claims. The sum of K639, 973. 46 is claimed in the statement of claim and the sum of K849,713.45 is claimed in submissions filed on behalf of Mr. Wapa.

8. The measure of damages for unlawful termination of a public servant was considered by the Supreme Court in Nazel Zanepa v. Ellison Kaivovo & Anor (1999) SC623 (Woods J., Sawong J., Injia J.(as he then was) dissenting).

9. The facts of Kaivovo's case (supra) are similar to those in this case. Default judgment was entered and the Supreme Court heard and dismissed an appeal against an assessment of damages. The appellant was employed by the Department of East New Britain. There was no evidence that he had any written contract of employment which took him out of the ordinary law or gave him any fixed term of employment. The Supreme Court said that:

"Whilst it may appear from s. 3(1)(b) of the Employment Act that public servants do not come under that Act because their employment comes under the Public Service (Management) Act, that Act does not give them any more rights than under the Employment Act…….. We find there is nothing in the (Public Service (Management) Act) which gives any rights or claims to permanency and thereby any consequent right to damages based on any other term than that referred to in the Employment Act."

10. This case was cited with approval by the Supreme Court in Boinamo Enterprises Ltd v. Michael Carey (2004) SC744. These decisions are binding on this court.

11. Here, there is no evidence of Mr. Wapa having a written contract of employment which takes him out of the ordinary law or gives him a fixed term of employment.

12. Following these authorities, Mr. Wapa is only entitled to damages equivalent to the required period of notice, which under s. 34 Employment Act is 4 weeks. 

13. As to the claims for loss because of reduced salary, loss of recreational leave entitlements, POSF entitlements and leave entitlements, these are covered by the ruling on the right to terminate under the Employment Act as considered in Kaivovo's case (supra) and Ereman Ragi & Anor v. Maingu (1994) SC459.

14. As to the claims for the loss of property and in respect of the death of a child, these in my view, are too remote. They are events that occurred independently of Mr. Wapa's termination of employment. The loss of the property occurred in 2001. The relevant bank began to take action under its mortgage almost 4 years after Mr. Wapa's termination of employment. As to the death of Mr. Wapa's child, while the incident is very distressing, I am not satisfied that the child's death was in anyway related to Mr. Wapa's termination of employment. I note that the child died on 12th June 1994 but according to Mr. Wapa's own evidence, he was removed from the payroll as of 31st December 1994.

15. As to the claims for judgment debts, I note that 3 of these were ordered in 1994 when Mr. Wapa was still being paid. The remainder I find to be too remote. There is not sufficient evidence in my view to show that they had anything to do with Mr. Wapa's termination of employment. 

16. I mention at this point with respect to Mr. Wapa, that I am minded to treat his evidence with caution, given his claims that I have found that relate to matters that occurred when he was still on the payroll.

17. As to the claim for loss of money, the time spent on pursuing his unlawful termination and airfares, there are no receipts in evidence, only letters and statutory declarations to the effect that funds were loaned to or expended by Mr. Wapa. I am not satisfied that Mr. Wapa has properly proved these damages.

18. As to the claims for loss of self-esteem, respect and for enduring shame and ridicule, I am not satisfied that Mr. Wapa is entitled to damages under these headings. The English House of Lords decision, Addis v. Gramophone Co Ltd [1909] AC 488 held that:

"where a servant is wrongfully dismissed from his employment, the damages for the dismissal cannot include compensation for the manner of his dismissal, for his injured feelings, or for the loss he may sustain from the fact that the dismissal of itself makes it more difficult for him to obtain fresh employment."

19. This remains the common law in England: Johnson v. Unisys Ltd [2001] 2 All ER 801, and so was the common law at the date of independence of Papua New Guinea, although unfair dismissal legislation has existed in England since 1971. Even so, I am not satisfied that Mr. Wapa has provided sufficient evidence to prove his damages claim under these headings. 

20. In this regard I refer to the case of Pama Anio v. Aho Baliki (2004) N2719, in which Kandakasi J. expressed the view that for claims for damages for distress and frustration, there should be proof of damage or the negative mental or physical impact on the claimant, by appropriate medical or other evidence. I respectfully agree with His Honour's comments. In this instance there is no medical evidence or to my mind, other sufficient evidence.

21. As to the claim for exemplary damages, pursuant to s. 12(1) Claims By and Against the State Act, no exemplary damages may be awarded against the State unless it appears to the court, that there has been a breach of Constitutional rights so severe or continuous as to warrant such an award.

22. In this regard, on the evidence presented, it does not appear to this court that there has been such a breach.

23. In conclusion, Mr. Wapa is only entitled to damages equivalent to the required period of notice under s. 34 Employment Act, which is 4 weeks. Given that Mr. Wapa has already received K130,932.92 in lost salaries, he has received more than his entitlement.

24. The plaintiff has failed to prove the claims he has made.

Orders

25. The formal Orders of the Court are:

 a) Judgment for the defendants.
 b) No order as to costs. 
_____________________________________________________________
Nandi & Company Lawyers: Lawyers for the Plaintiff