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Con v Jant Ltd [2014] PGNC 128; N5721 (9 September 2014)

N5721

PAPUA NEW GUINEA
IN THE NATIONAL COURT OF JUSTICE

WS NO 1019 OF 2013

TIMOTHY CON
Plaintiff

V

JANT LIMITED
Defendant

Madang: Cannings J
2014: 21 May, 20 June, 9 September

DAMAGES – breach of contract – assessment of damages following trial on liability – failure by employer to pay final entitlements upon retirement of employee – whether plaintiff entitled to general damages for hardship and distress – whether plaintiff entitled to damages not sought in statement of claim.

The plaintiff established liability in breach of contract against the defendant, his former employer, due to the defendant's failure to pay, by an agreed date, all items it was obliged to pay or provide to him as final entitlements. At this trial on assessment of damages, the plaintiff claimed two categories of damages: (1) general damages (hardship and suffering) of K10,000.00 and (2) special damages of K32,503.00, being a total claim of K42,503.00.

Held:

(1) The claim for general damages was excessive. K5,000.00 was awarded.

(2) The part of the special damages claim (K13,303.00) that related to the amount due under the contract of employment was upheld, but the part that related to alleged unpaid duty allowances (K19,200.00) was refused as it was not pleaded in the statement of claim.

(3) The total award of damages was K18,303.00. In addition, interest of K3,572.75 was awarded. The total judgment sum was K21,875.75. The defendant was ordered to pay the plaintiff's costs.

Cases cited

The following cases are cited in the judgment:

George Podas v Divine Word University (2011) N4395
Kondai v Siki and Port Moresby Institute of Matriculation Studies (2014) N5594
Mairi Hoi v Arthur Somare (2012) N4749
Pokowan Kandaso v MVIT (1992) N1074
Timothy Con v Jant Ltd (2014) N5503

ASSESSMENT OF DAMAGES

This was a trial on assessment of damages for breach of contract.

Counsel

J Morog, for the plaintiff
J J Lome, for the defendant

9th September, 2014

1. CANNINGS J: This has been a trial on assessment of damages. The plaintiff Timothy Con established liability in breach of contract against the defendant, his former employer, due to the defendant's failure to pay, by an agreed date, all items it was obliged to pay or provide to him as final entitlements under his contract of employment.

2. The plaintiff was employed as the defendant's chip-mill manager at Madang. He worked for the defendant for 37 years. As part of the downsizing of the defendant's operations, he was encouraged in early 2012 to resign, which he did. To give effect to his resignation, he and the defendant entered into a memorandum of agreement, which had the effect of varying the most recent written contract of employment that the parties had entered into, in October 2011. The varied contract required the defendant to make certain payments and provide certain things (eg roofing iron and a chainsaw head) to the plaintiff by 30 March 2012. It made some of the payments but not all of them and did not provide the items it was required to provide. The defendant withheld those things until the plaintiff vacated the accommodation provided to him as part of his employment. The defendant's conduct was held in the judgment on liability to amount to a breach of contract (Timothy Con v Jant Ltd (2014) N5503).

3. At this trial on assessment of damages, the plaintiff claimed two categories of damages: (1) general damages (hardship and suffering) of K10,000.00 and (2) special damages of K32,503.00, being a total claim of K42,503.00. Mr Lome for the defendant submitted that the plaintiff was only entitled to K13,303.00, the amount due under the memorandum of agreement.

1 GENERAL DAMAGES

4. The plaintiff claims K10,000.00 on account of pain, suffering and inconvenience caused by the conduct of the defendant. I agree that, in principle, this is a proper claim, for the reasons I set out in George Podas v Divine Word University (2011) N4395, which are consistent with those of Makail J in Mairi Hoi v Arthur Somare (2012) N4749.

5. In Kondai v Siki and Port Moresby Institute of Matriculation Studies (2014) N5594 K3,000.00, was awarded for this sort of claim. The plaintiff was a teacher who was employed by the defendants for two and a half years. As in the present case the defendants were liable for damages for a breach of contract. Comparing the facts of that case with those of the present case and bearing in mind in particular that the present plaintiff had worked for his employer for a considerably longer period than in Kondai, the plaintiff deserves more. I award K5,000.00.

2 SPECIAL DAMAGES

6. This claim has two components:

(a) the amounts still due under the memorandum of agreement, K13,303.00; and

(b) duty allowances still to be paid under the contract of employment dated 20 October 2011, K19,200.00,

being a total claim of special damages of K42,503.00.

7. Mr Lome for the defendant concedes that the plaintiff is entitled to (a) but argues that nothing should be awarded for (b). I agree. The plaintiff is clearly entitled to (a) but just as clearly has no entitlement under (b). As a general rule, a court can only award the types of damages that are sought in the statement of claim (Pokowan Kandaso v MVIT (1992) N1074). Here, damages for unpaid duty allowances were not sought in the statement of claim, indeed nothing at all was pleaded about unpaid duty allowances. Therefore nothing is awarded. The total award of special damages is K13,303.00.

SUMMARY OF DAMAGES AWARDED

General damages: K5,000.00
Special damages: K13,303.00

Total = K18,303.00

INTEREST

8. 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 will be calculated in respect of the period from the date on which the cause of action accrued (when the contract was breached, 27 March 2012) to the date of this judgment, 9 September 2014, a period of 2.44 years, by applying the 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 and A is the amount of interest. Thus K18,303.00 x 0.08 x 2.44 = K3,572.75.

COSTS

9. In the judgment on liability I reserved the question of costs for further argument. Having heard from counsel on that issue I am satisfied that the rule of thumb that costs are awarded to the successful party, should apply. The successful party is the plaintiff. He succeeded at the earlier trial in establishing liability and he has succeeded in obtaining an award of damages. The claim, while not totally successful, was not outlandish. The plaintiff will be awarded costs on a party-party basis.

ORDER

(1) The defendant shall pay to the plaintiff damages of K18,303.00 plus interest of K3,572.75, being a total judgment sum of K21,875.75.

(2) The defendant shall pay the plaintiff's costs of these proceedings on a party-party basis which shall, if not agreed, be taxed.

Judgment accordingly.
____________________________________________________________
Public Solicitor: Lawyer for the Plaintiff
Greg Manda Lawyers: Lawyers for the Defendant