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Rageau v Kina Finance Ltd [2015] PGNC 135; N6042 (22 June 2015)

N6042

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS 253 of 2015

BETWEEN:

DR. ONNE RAGEAU
Plaintiff

AND:

KINA FINANCE
LIMITED
Defendant

Waigani: Hartshorn J
2015: 12th, 22nd June

Whether interim injunctive relief already granted should continue

Cases cited:

Airlines of PNG v. Air Niugini Ltd (2010) N4047
American Cyanamid Company v. Ethicon Limited [1975] UKHL 1; (1975) AC 396
Golobadana No 35 Ltd v. Bank of South Pacific (2002) N2309
Markscal Ltd v. MRDC [1996] PNGLR 419
PAC LNG International Ltd v. SPI (208) Ltd (2014) N5681
PNG Deep Sea Fishing Ltd v. Luke Critten (2010) SC1126
Robinson v. National Airlines Commission [1983] PNGLR 478
Counsel:

Mrs. M. Saroa, for the Plaintiff
Mr. D. Bidar, for the Defendant
22nd June, 2015

1. HARTSHORN J: This is a decision on whether interim relief that has already been granted should continue.

2. On 14th May 2015 this Court granted interim orders that amongst others, pending determination of this proceeding or until further orders, the defendant is restrained from effecting the sale, or transfer of the plaintiff's Property. This proceeding was then transferred to the Commercial Track by Kariko J on 28th May 2015 after His Honour disqualified himself from hearing the matter. On 3rd June 2015, it was ordered by consent that the matter was adjourned to 2:30pm on 12th June 2015 for a hearing inter partes as to whether the interim relief already granted should continue.

3. When the matter was called at 2:30pm on 12th June 2015, this Court again confirmed with counsel that both parties agreed that the hearing before the Court was to determine whether the interim relief that had already been granted should continue. Both counsel confirmed this position.

Background

4. The plaintiff is the registered proprietor of the property known as Allotment 61 Section 51 Granville, Touaguba Hill, Port Moresby, State Lease Volume 8 Folio 1808 (Property).

5. The defendant in about September 2014 in other proceedings sued the plaintiff for defaulting in making necessary loan payments under the loan agreement with the defendant in respect of the Property. The Property is subject to a mortgage given by the plaintiff to the defendant.

6. The plaintiff claims that in or about November 2014 he secured refinancing to repay the defendant's loan but that this was not accepted by the defendant.

7. The defendant obtained amongst others, default judgment against the plaintiff on 16th February 2015 and a Writ for Possession of the Property was issued on 24th February 2015. The defendant as mortgagee has advertised the Property for sale and has a buyer for the Property.

8. The plaintiff commenced this proceeding on 12th May 2015 by originating summons, and seeks amongst others declaratory relief in regard to an alleged purchase price of K1.8 million for the Property and in regard to the calculations and assessment of the debt due by the plaintiff to the defendant. The plaintiff claims amongst others that the alleged purchase price and the calculations of the debt due are incorrect.

Law

9. The first consideration in determining whether injunctive relief should be granted is whether there is a serious question to be tried. The case cited by the plaintiff, Golobadana No 35 Ltd v. Bank of South Pacific (2002) N2309 is an authority for that proposition.

10. A serious question to be tried has been interpreted to mean:

"What the plaintiff must prove is that he has a serious, not a speculative case which has a real possibility of ultimate success....":Robinson v. National Airlines Commission [1983] PNGLR 478 and

"..... a strong case which, on the evidence presented would support a permanent injunction":Markscal Ltd v. MRDC [1996] PNGLR 419.

11. The parties have filed affidavits in support of their respective positions. As to the court's consideration of that evidence at this stage, I am mindful of the words of Lord Diplock in American Cyanamid Company v. Ethicon Limited [1975] UKHL 1; (1975) AC 396:

"It is not part of the court's function at this stage of the litigation to try to resolve conflicts of evidence on affidavit as to facts on which the claims of either party may ultimately depend nor to decide difficult questions of law which call for detailed argument and mature considerations."

12. Given amongst others, the necessity to deliver a quick ruling, I will not consider and determine whether the plaintiff has established that he has a serious question to be tried. I will presume for present purposes only that he has. This is not in any way to be taken that I have formed a view either way on this issue.

13. On the presumption that the plaintiff has a serious question to be tried, the next consideration is whether he would be adequately compensated in damages.

14. If damages would be an adequate remedy then even if there is a serious question to be tried interlocutory injunctive relief should be refused: Airlines of PNG v. Air Niugini Ltd (2010) N4047 at 22 and 23; PNG Deep Sea Fishing Ltd v. Luke Critten (2010) SC1126 at 30 and PAC LNG International Ltd v. SPI (208) Ltd (2014) N5681 at 24.

15. The rationale for the court considering whether damages would be an adequate remedy was explained by Lord Diplock in American Cyamamid (supra) at 408:

"[t]he court should go on to consider whether, if the plaintiff were to succeed at the trial in establishing his right to a permanent injunction, he would be adequately compensated by an award of damages for the loss he would have sustained as a result of the defendant's continuing to do what was sought to be enjoined between the time of the application and the time of the trial. If damages... would be an adequate remedy and the defendant would be in a financial position to pay them, no interim injunction should normally be granted, however strong the claimant's claim appeared to be at that stage."

16. In Airlines PNG v. Air Niugini (supra), I refused to grant injunctive relief as I was satisfied that any loss suffered by Airlines PNG would be able to be quantified and that it had not been shown that damages would not be an adequate remedy.

17. Counsel for the plaintiff submitted that damages would not adequately compensate the plaintiff as the plaintiff's character and integrity will be called into question and his business reputation is in question due to the defendant allegedly giving misleading information to the National Development Bank. This will affect whether lending companies and banks will provide loan facilities to the plaintiff. This in turn also affects the operation of the plaintiff's medical practice and his personal life.

18. Counsel for the defendant submitted that because of the substantive relief claimed, this proceeding is not concerned with the plaintiff's character, integrity or business reputation, his medical practice or personal life. The proceeding concerns whether the stated purchase price is correct and whether the calculation and assessment of the debt due to the defendant is correct. It is not in dispute that the plaintiff is in debt to the defendant and the defendant has amongst others a default judgment to that effect.

19. From a perusal of the relief sought in the originating summons, it does not concern any of the matters referred to by counsel for the plaintiff. Further, no substantive orders are sought to restrain the sale of the Property by the defendant and the defendant does have a default judgment for a liquidated amount against the plaintiff. No application was made to set aside that default judgment and it has not been appealed.

20. In answer to a question from the Court as to why the plaintiff could not continue to seek the relief that he does in the originating summons against the defendant if the Property was sold, counsel for the plaintiff correctly conceded that the plaintiff could continue to seek that relief and is not precluded from doing so if the Property is sold.

21. Given this concession, it begs the question why the relief in the amended notice of motion is sought because if that relief is not granted, the plaintiff is not precluded in any way with proceeding with his substantive claim.

22. It is the case that if the plaintiff is successful in this proceeding against the defendant and it is determined for instance, that the defendant should have sold the Property at a higher price, (even though no such substantive relief is claimed), the difference can be quantified and damages paid for that amount. Further, there is no evidence that the defendant would not be able to meet an award of damages.

23. After considering the submissions and evidence on this issue, I am satisfied that damage's is an adequate remedy. Consequently the relief that is sought and that was initially granted in the amended notice of motion should be refused.

Orders

24. The Orders of this Court are:

a) The relief sought in the amended notice of motion filed 14th May 2015 is refused and the interim relief that was granted by this Court on 14th May 2015 and extended on 28th May 2015 is set aside;

b) the costs of and incidental to the hearing on 12th June 2015 are to be paid by the plaintiff to the defendant;

c) time is abridged.
_____________________________________________________________
Nelson Lawyers: Lawyers for the Plaintiff
O'Briens Lawyers: Lawyers for the Defendant