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National Court of Papua New Guinea |
PAPUA NEW GUINEA N6494
[IN THE NATIONAL COURT OF JUSTICE]
WS NO. 664 OF 1994
BETWEEN:
MOUNT KARE ENTERPRISES PTY LTD
Plaintiff
AND:
GUTNIUS LUTHERAN CHURCH OF PAPUA NEW GUINEA INC.
Defendant
Mt Hagen: Poole, J
2016: 24th March
LIMITATION – action on judgment after expiration of 12 years from time judgment takes effect forbidden by Section 16 (5) of Frauds and Limitations Act. Order 4 rule 3 (4) of National Court Rules gives discretion to Court to order Judgment to take effect earlier or later – discretion to make such an Order will not be made if delay excessive – delay of more than 20 years excessive – public interest requires a finality to litigation.
JUDGMENT – is the formal order of the Court entered on the record, not the
expiration of how the Court applied the law to the facts to reach its decision.
PNG Authorities:
Herman Gawi v PNG Ready Mixed Concrete (1983)).
Rose v The State N3241
The State v McCleary [1976] PNGLR 321
Counsel:
V Palts, for the Plaintiff
N/A for the Defendant
24 March 2016
Background
1. POOLE J: The Plaintiff filed a Statement of Claim on the 26th of August 1994 claiming K11, 600.00 as damages for breach of agreement under which it was to be paid a certain sum for building works carried out for the Defendant at a school in Wabag. The Statement of Claim was duly served but the defendants failed to enter a Notice of Intention to Defend or Defense and default judgment on liability was entered on the 25th of November 1994.
2. On the 15th of December 1994 the Plaintiff obtained judgment in the sum of K44,600.00, an Order for interest in the sum of K1,187.33, interest on the judgment at 8% from the 6th of December 1995 and costs assessed at K320.00. The Order was taken out and the Plaintiff filed a Writ of Levy of Property on the 26th of March 1998 but, for reasons not clear, did not proceed with this enforcement. The Plaintiff changed lawyers and, on the 28th of May 2014, another Writ of Levy was filed and, on the 7th of July 2015, the Plaintiff applied by motion for judgment for interest which, together with the original judgment, was claimed in the total amount of K67, 465.84.
3. The matter, after a number of changes of lawyers and mentions, came before me on the 17th of March 2016, for a ruling on the question of whether the judgment on the 5th of December 1995 can be enforced or whether it is barred by lapse of time. Despite the defendant being served in accordance with the rules it has apparently chosen not to appear.
4. I have been assisted by cogent submissions by counsel for the Plaintiff on the 17th of March 2016 and have considered those submissions and the issues rise in this matter at some length.
5. The Chronology of this matter maybe summarized as:
6. The Law falling to be considered especially concerns the provisions of section 16 (5) of the Frauds and Limitations Act which, relevantly, states:
“(1) Subject to Sections 17 and 18, an action –
“(a) that is founded on simple contract or on tort; or
“(b) to enforce a recognizance; or
“(c) to enforce an award, where the submission is not by an instrument under seal; or
“(d) to recover any sum recoverable by virtue of any enactment, other than a penalty or forfeiture or sum by way of penalty or forfeiture, shall not be brought after the expiration of six years commencing on the date on which the cause of action accrued.
“(2) An action for an account shall not be brought in respect of any matter which arose more than six years before the commencement of the action.
“(3) Subject to Subsection (4), an action upon a specialty shall not be brought after the expiration of twelve years commencing on the date when the cause of action accrued.
“(4) Nothing contained in Subsection (3) shall be construed as affecting any action for which a period of limitation is specified by any other Act, and that subsection shall be read and construed accordingly.
“(5) An action shall not be brought upon any judgment after the expiration of twelve years commencing on the date when the judgment became enforceable.
“(6) No arrears of interest in respect of any judgment debt shall be recovered after the expiration of six years commencing on the date when the interest became due.
“(7) Subject to Subsection (8), an action to recover any penalty or forfeiture, or sum by way of penalty or forfeiture, recoverable by virtue of any enactment shall not be brought after the expiration of two years commencing on the date when the cause of action accrued.
“(8) For the purpose of Subsection (7) the word “penalty” does not include a fine to which any person is liable on conviction of a criminal offence.”
7. The date upon which the judgment becomes enforceable is clearly set out in Order 12 rule 3 of the National Court Rules – especially rule 3 sub-rule 3. The rule is in this form:
(1) Where a judgment is entered pursuant to a direction of the Court the judgment shall take effect as of the date of direction.
(2) Where a judgment is entered otherwise than pursuant to a direction of the Court the judgment shall take effect as of the date of entry.
(3) Subject to Sub-rules (1) and (2), an order shall take effect as of the date on which it is made.
(4) Notwithstanding Sub-rules (1), (2) and (3), the Court may order that a judgment at order take effect as of a date earlier or later than the date fixed by those Sub-rules.
8. It is true that the Court has power, by order, to have a Judgment take effect earlier or later than the dates fixed by sub-rules and the wording of the provision indicates that the power is one to be exercised in the Court’s discretion. The exercise of such discretion must not be by arbitrary whim but be for substantial reason and exercised honestly in the spirit of the statute from the provisions of which the discretion arises.
9. In this instance, the National Court Act, under which the National Court Rules stating the date upon which an Order takes effect, is expressed as “an Act to Implement
Sub-division vi.5D (The National Court of Justice) and Section 168 (qualifications) of the Constitution to provide for......
a) The qualification and appointment as a Judge of the National Court, and
b) The practice and procedure of the National Court.”
10. In other words, the practice and procedure of making Orders which, in this case, proceeds on discretion as to the time the order is to take effect.
11. The question the Court has to consider in this matter is weather the Judgment of the 5th of December 1995 remains one upon which an action maybe brought.
12. “Action” is appropriately defined by Stroud’s Judicial Dictionary as “A generic term, and means a litigation in a civil court for the recovery of individual right or redress of individual wrong, inclusive.......of suits by the Crown” and is said to continue until judgment be given then the process of execution begins.” Execution (or enforcement) of an action begins when the action is brought to an end by judgment.
13. “Judgment,” strictly speaking, is the ruling or sentence the Court makes on the matter on the record before it, not the reasons for the ruling or sentence. The Judgment is the formal Orders, not the exposition by the Court of how it applied the law to the facts of the case to reach the decision framed in the Orders.
14. From this it is clear that the wording of Section 16 (5) of the Frauds and Limitations Act imposes a prohibition on steps to enforce a Judgment (viz “an action upon a Judgment”) more than 12 years after the date on which the Judgment is made. That date is the date the Order/Judgment is entered – in this case the 13th of December 1995.
15. Because Order 4 rule 3 (4) states “the Court may order that a judgment at (semble “or”) order take effect as of a date earlier or later than the date fixed by these sub-rules” the question now arises whether, in the exercise of my discretion, I order that the date for the Order/Judgment of the 13th of December 1995 to take effect be later than the date expressed in sub-rule 2 ie “the date on which it is made.”
16. The Plaintiff seeks to be able to avail itself of the benefit of an Order of the 5th of December 1995 more than 20 years after the Order/Judgment was made and more than 7 years after the limitation imposed by Section 16 (5) of the Frauds and Limitations Act took effect. The Plaintiff has had ample opportunity over the years to enforce its Judgment and has not taken any apparent steps to do so. Nor has it provided any explanation at all for its failure to do so.
17. One of the most important principals of the administration of Justice is that it is manifestly in the public interest that there be an end to litigation. (See The State v McCleary [1976] PNGLR 321, Rose v The State N3241; Herman Gawi v PNG Ready Mixed Concrete (1983)). A party cannot simply rest on its rights, put issues in a sort of legal deep freeze, and then seek to revive them many years later. It is for this public policy that the Parliament of Papua New Guinea passed the Frauds and Limitations Act which is expressed as being “to make provisions with respect to the limitation period for the bringing of actions.”
18. I consider the delay in this matter to be so great that it would be against the spirit and intendment of the Frauds and Limitations Act for me to exercise a discretion under Order 4 rule 3 (4) on the National Court Rules and Order that the Order/Judgment of the 5th of December 1995 take effect at so much later a date then the date of entry of the Order as to permit the Plaintiff to take steps to enforce it.
19. The Formal Order of the Court are as follows:
1. The Plaintiff’s Motion filed on the 7th of July 2015 is refused
2. Each party will bear its own costs
3. The time for the entry of this Order is abridged to the time of sealing by the Registrar which shall take place forthwith.
________________________________________________________________
Veronica Palts Lawyers: Lawyers for the Plaintiffs
N/A: Lawyers for the Defendant
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URL: http://www.paclii.org/pg/cases/PGNC/2016/292.html