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Roth v Waironak [2011] PGNC 153; N4452 (18 November 2011)

N4452

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

WS NO 1576 OF 2010

SAMUEL ROTH
Plaintiff

V

SAMUEL WAIRONAK
First Defendant

LAWRENCE JOGAMUP
Second Defendant

MAIGARI LIMITED
Third Defendant

Madang: Cannings J
2011: 9 September, 4, 18 November

DAMAGES – breach of contract – assessment of damages after entry of default judgment – plaintiff hired his vehicle to the third defendant, whose employer drove it negligently, causing damages beyond repair – damages claimed for new vehicle, business losses and mental distress.

The plaintiff hired his motor vehicle to the third defendant for one day. During the course of the hire period an employee of the third defendant drove the vehicle negligently and it was damaged beyond repair. The plaintiff sued the third defendant and its general manager and the chairman of its board of directors. The defendants failed to defend the claim and default judgment was entered against them subject to an assessment of damages. This is the trial on assessment of damages. The plaintiff claimed three heads of damage: general damages for loss of vehicle, K133,771.00; business losses, K158,000.00; and damages for mental distress, K20,000.00.

Held:

(1) The plaintiff failed to adduce sufficient evidence to support most of the claims.

(2) The court awarded a total amount of damages of K70,000.00; plus interest of K7,840.00, being a total judgment sum of K77,840.00.

Cases cited

The following cases are cited in the judgment:

Abel Kopen v The State [1988-89] PNGLR 655
Graham Mappa v ELCOM (1992) N1093
Jonathan Mangope Paraia v The State (1995) N1343
Livingston v Raywards Coal Co [1880] 5 App Cases 25
Misac Pokonoming v Jeffery Simiri WS 1596/2005, 26.10.07

TRIAL

This is a trial on assessment of damages after entry of default judgment.

Counsel

S Roth, the plaintiff, in person

18 November, 2011

1. CANNINGS J: The plaintiff, Samuel Roth, has sued the defendants, Samuel Waironak, Lawrence Jogamup and Maigari Ltd, for breach of contract. The plaintiff hired his motor vehicle to Maigari Ltd for one day. During the course of the hire period an employee of Maigari drove the vehicle negligently and it was damaged beyond repair. The plaintiff sued Maigari and its general manager, Mr Jogamup, and the chairman of its board of directors, Mr Waironak. The defendants failed to defend the claim and default judgment was entered against them subject to an assessment of damages. This is the trial on assessment of damages. The plaintiff claims three heads of damage: general damages for loss of vehicle, K133,771.00; business losses, K158,000.00; and damages for mental distress, K20,000.00.

1 GENERAL DAMAGES

2. The plaintiff has adduced evidence that as a result of the defendants' driver's negligence (the vehicle ran off the road at the junction of the Lae Highway and Baidal Road, Madang town) the vehicle is a write-off. It is a Toyota 10-seater and Ela Motors Madang have provided an opinion that it is beyond economic repair and that a replacement vehicle would cost K133,771.00, which is the amount of general damages claimed by the plaintiff. There is a serious flaw in the plaintiff's case here. It is not clear what the pre-accident value of the vehicle was. There is very little evidence to go on. The plaintiff wrongly assumes that he is entitled to the cost of a brand new vehicle. This approach would offend against a fundamental principle of the law of damages: the purpose of an award of damages is to put the innocent party in the same position, as far as possible, as he would have been in if the wrongdoer had not committed the wrongful act (Livingston v Raywards Coal Co [1880] 5 App Cases 25). To put the plaintiff, Mr Roth, in the same position he was in before his vehicle was negligently damaged, it is necessary for him to be awarded damages calculated by reference to the cost of a replacement vehicle. There are photos of the vehicle in evidence. It does not appear to be a recent model. I consider a reasonable amount to award is K50,000.00.

2 BUSINESS LOSSES

3. If a defendant causes damage to a plaintiff's profit-earning asset, the plaintiff is entitled to damages to compensate him for profits lost during the period that is reasonable to repair the asset (Abel Kopen v The State [1988-89] PNGLR 655, National Court, Woods J). Ideally the plaintiff should provide an audited set of accounts to verify his claim. However, if that evidence is not forthcoming, it does not follow, necessarily, that the plaintiff will be awarded nothing. The court will do the best it can on the evidence that is available. (Graham Mappa v ELCOM (1992) N1093; Jonathan Mangope Paraia v The State (1995) N1343; Misac Pokonoming v Jeffery Simiri WS 1596/2005, 26.10.07). Mr Roth submits that, though he only charged Maigari K400.00 for the one day hire, the normal hire rate was K850.00 per day. He claims K158,000.00, which he says is the amount of business losses he has incurred since the date of the incident, 1 July 2010.

4. There are two problems with this claim. First, there is no set of accounts, audited or unaudited, to verify the figures. In fact there is no evidence at all to support the figures. The court does not know how often the plaintiff hired his vehicle. Secondly, the period of almost 18 months to repair or replace the vehicle is not reasonable. I will assess lost profits at a nominal figure of K5,000.00 per month. As for a reasonable period to effect repairs or organise a replacement vehicle I have looked at what Woods J allowed in the Kopen and Mappa cases (3 weeks and 13 weeks respectively) and compared the facts of this case with the facts in those cases. I will allow a period of three months. The amount of lost profits I award is therefore K5,000.00 per month x 3 months = K15,000.00.

3 MENTAL DISTRESS

5. The plaintiff claims K20,000.00 for the distress and frustration he endured as a result of the defendant's breach of contract. The plaintiff has testified that he has suffered great inconvenience, hardship, distress and anxiety. This is understandable. He has tried to get the matter settled out of court but the defendants have been uncooperative. I award K5,000.00.

SUMMARY OF DAMAGES ASSESSED

(1) general damages: K50,000.00;
(2) business losses: K15,000.00;
(3) mental distress: K5,000.00.

being a total amount of K70,000.00.

INTEREST

6. Interest will be awarded at the rate of 8 per cent per annum on the total amount of damages under Section 1(1) of the Judicial Proceedings (Interest on Debts and Damages) Act Chapter No 52. Interest is calculated from the date on which the cause of action accrued, 1 July 2010, to the date of this judgment, a period of 1.4 years, by applying the following formula:

• D x I x N = A
  

Where:

• D is the amount of damages assessed;
• I is the rate of interest per annum;
• N is the appropriate period in numbers of years;
• A is the amount of interest.
  

Thus K70,000.00 x 0.08 x 1.4 = K7,840.00.

COSTS

7. The general rule is that costs follow the event, ie the successful party has its costs paid for by the losing party on a party-to-party basis. The question of costs is a discretionary matter. There are no special circumstances in this case that warrant departure from the general rule. The plaintiff is the successful party and he shall get his costs.

ORDER

8. The court orders that:

(1) the defendants pay to the plaintiff damages of K70,000.00 plus interest of K7,840.00, being a total judgment sum of K77,840.00; and

(2) the defendants pay costs of the proceedings to the plaintiff on a party-party basis, to be taxed if not agreed.

Judgment accordingly.
_____________________________

Lawyers for the plaintiff: Self-represented