N4357

PAPUA NEW GUINEA
IN THE NATIONAL COURT OF JUSTICE

WS 681 OF 2002

BETWEEN:

WILLIAM KUNIA
Plaintiff

AND:

TOM NAKEI
First Defendant/Cross Claimant

AND:

RURAL DEVELOPMENT BANK LIMITED
Second Defendant/Cross Defendant

Waigani: Hartshorn J.
2009: 18th & 19th August
2010: 15th March

Application for an order directing the entry of judgment for the defendant – Order 10 Rule 14 National Court Rules 

Facts:

The plaintiff obtained a loan from the second defendant for the purchase of a truck and lawn mowers. The repayment of the loan fell into arrears and the second defendant sold the plaintiff's property that was security for the loan, by mortgagee sale. The plaintiff alleges that the second defendant was negligent in its conduct of the loan and in its dealings with him and as a consequence he suffered substantial loss. He commenced this proceeding seeking amongst others, damages for loss suffered. The second defendant denies that it was negligent, that it is liable for any loss suffered by the plaintiff or that the plaintiff suffered any loss.

Held:

The application of the second defendant/cross defendant for an order directing the entry of judgment in the proceeding in its favour is granted. The cross claim is dismissed. The plaintiff is to pay the costs of and incidental to the proceeding to the second defendant/cross defendant. The first defendant/cross claimant is to pay the costs of the cross claim to the second defendant/cross defendant.

Cases cited: 
Papua New Guinea Cases

Damansara Forest Products (PNG) Ltd (In Liquidation) v. R. H. Trading Ltd (2004) N2723 

Overseas cases

Hiddle v. National Fire & Marine Insurance Co of New Zealand [1896] AC 372
Bell v. Thompson (1934) 34 SR (NSW) 436
Carr v. Baker (1936) 36 SR (NSW) 301
De Gioia v. Darling Island Stevedoring & Lighterage Co Ltd (1942) 42 SR (NSW) 1
Jones v. Dunkel (1959) 101 CLR 298; [1959] ALR 367

Counsel:

Mr. C.S.N. Narokobi, for the Plaintiff 
Mr. G.P. Manda and Mr. R.J. Mann-Rai, for the Second Defendant/Cross Defendant

15th March, 2010

1. HARTSHORN J. The plaintiff, Mr. Willie Kunia obtained a loan from the second defendant, the Rural Development Bank Limited (RDB) for amongst others, the purchase of a truck and lawn mowers.

2. The repayment of the loan fell into arrears and RDB sold Mr. Kunia's property that was security for the loan, by mortgagee sale.

3. Mr. Kunia alleges that RDB was negligent in its conduct of the loan and in its dealings with him and as a consequence he suffered substantial loss. Mr. Kunia commenced this proceeding seeking amongst others, damages for loss suffered.

4. RDB denies that it was negligent, that it is liable for any loss suffered by Mr. Kunia or that Mr. Kunia suffered any loss.

Preliminary

5. Mr. Kunia named Mr. Tom Nakei as first defendant in this proceeding but no relief was sought against him by Mr. Kunia in his amended statement of claim.

6. Mr. Nakei issued a cross claim against RDB. There was no appearance by Mr. Nakei at the substantive hearing and the cross claim was dismissed upon the successful application of counsel for RDB, pursuant to Order 10 Rule 12 National Court Rules.

Order 10 rule 14 application

7. At the substantive hearing of the proceeding after the conclusion of the evidence in chief for Mr. Kunia, counsel for RDB informed the court that RDB was not calling any evidence. He then moved the court pursuant to Order 10 Rule 14 National Court Rules, for an order directing the entry of judgment in the proceeding for RDB on the ground that, on the evidence given, an order directing the entry of judgment for Mr. Kunia could not be supported.

8. As to how Order 10 Rule 14 has been applied in this jurisdiction, no cases from our jurisdiction were cited that I found to be on point and I have been unable to locate any decisions that were of assistance apart from a decision of Davani J. in Damansara Forest Products (PNG) Ltd (In Liquidation) v. R. H. Trading Ltd (2004) N2723 where the application under Order 10 Rule 14 was refused.

9. The wording of Order 10 Rule 14 is very similar to Rule 34.7 of the New South Wales Supreme Court Rules 1970 and a similar rule in England. Decisions on those provisions are persuasive in our jurisdiction.

10. Such an application, according to Ritchie's Supreme Court Procedure, New South Wales, is similar to the application for 'nonsuit' at common law. It will be granted if a verdict could not reasonably be given for the plaintiff on the evidence adduced: Hiddle v. National Fire & Marine Insurance Co of New Zealand [1896] AC 372 at 375-6; De Gioia v. Darling Island Stevedoring & Lighterage Co Ltd (1942) 42 SR (NSW) 1; Jones v. Dunkel (1959) 101 CLR 298 at 330-1; [1959] ALR 367. If the evidence is equivocal about the existence or non-existence of a fact that the plaintiff must establish, the case must fail and a dismissal order is appropriate: Bell v. Thompson (1934) 34 SR (NSW) 436; Carr v. Baker (1936) 36 SR (NSW) 301.

11. The only evidence given on behalf of Mr. Kunia was his affidavit sworn on 30th January 2007 which was admitted into evidence as exhibit "A" and a District Court order, exhibit "B". Mr. Kunia was then cross examined and re-examined. There was also before the court a statement of agreed and disputed facts.

12. Counsel for RDB submitted that Mr. Kunia's evidence lacked credibility as amongst others:

•	he did not satisfactorily explain why he did not inform RDB immediately that he had not received the cheque for the purchase of the truck or possession of the truck.

•	he said that the reason Mr. Nakei was not present in court was because he was concerned at the consequences of him forging a statutory declaration to change the ownership of the truck; but would not explain how he knew this.

•	the truck was registered in Mr. Kunia's name from 1st March 2000 notwithstanding that Mr. Kunia said that he did not take possession of the truck.

•	he had entered into an agreement with Mr. Nakei, a term of which was that Mr. Nakei would be a witness for Mr. Kunia against RDB in this proceeding.

•	he said that Mr. Samuel Epa had arranged a loan with RDB and that by the delivery of the truck to Mr. Nakei and that by his conduct, Mr. Epa had in some way committed RDB, when at all material times Mr. Epa was no longer employed by RDB and was by Mr. Kunia's admission, a consultant to Mr. Kunia from 10 January 2000.

13. Counsel for RDB submitted further, that there was no evidence adduced of any negligence by any employees of RDB. Consequently on the evidence that had been given, the court could not direct the entry of judgment for Mr. Kunia.

14. Counsel for Mr. Kunia submitted amongst others that:

•	Mr. Kunia relied upon four affidavits, when in fact only one was tendered into evidence as previously referred to.

•	the agreed facts involved admissions by RDB that Mr. Kunia did not receive the cheque for the truck or possession of the truck.

•	there was a duty upon RDB to ensure the cheque was released to Mr. Kunia and that he received the truck.

•	there is enough evidence adduced to demonstrate a cause of action or prima facie case.

15. To succeed in his action, Mr. Kunia has to prove on the balance of probabilities that RDB had a duty of care to Mr. Kunia, that duty was breached by the negligent conduct of RDB or its employees and that loss was suffered.

16. To my mind there has not been evidence adduced on behalf of Mr. Kunia especially as to any negligence by RDB that would allow this court to give judgment in Mr. Kunia's favour. The fact that Mr. Kunia was not given the cheque for the truck or the possession of the truck is not evidence on its own of RDB's negligence. The evidence that was adduced was equivocal as to liability by RDB especially when regard is had to the role that Mr. Epa played as consultant to Mr. Kunia, his role in arranging and dealing directly with RDB in regard to the loan, and his dealings with Mr. Nakei, as deposed to by Mr. Kunia. In addition, I did not find Mr. Kunia convincing in the oral evidence that he gave and I am not satisfied that the evidence that he gave was altogether truthful.

17. Consequently the application of the second defendant/cross defendant for an order directing the entry of judgment in the proceeding in its favour is granted.

Orders

18.	 a)	Judgment in this proceeding is entered for the second defendant/cross defendant.

b)	the cross claim is dismissed.

c) the plaintiff is to pay the costs of and incidental to the proceeding to the second defendant/cross defendant.

d)	the first defendant/cross claimant is to pay the costs of the cross claim to the second defendant/cross defendant.

_________________________________________________________
Narokobi Lawyers: Lawyers for the Plaintiff 
Greg Manda Lawyers: Lawyers for the Second Defendant/Cross Defendant