N6240

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS. NO. 708 of 2000

BETWEEN:

HARRY TOVON for and on behalf of himself, JOHN COOMER & 55 OTHERS
Applicants

AND

CARL MALPO as Commander of the Papua New Guinea Defence Force
First Respondent

AND

THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Second Respondent

Waigani: Kandakasi, J.
2015:	 5 & 14th August
2016:	4th April

JUDGMENTS AND ORDERS – Application to set aside consent orders on the basis of lack of authority in lawyer representing the applicants – Whether lack of authority in lawyer can undo consent orders? – Proper cause or remedy for an aggrieved party – Need to observe the need for finality in litigation – Primary Court must be careful not to assume and exercise the powers of an appellate or review court or determine a separate cause of action without the benefit of proper pleadings and observance of natural justice. 

PRACTICE & PROCEDURE – Setting aside of consent orders – Application by notice of motion in proceedings already concluded by the consent orders – National Court functus officio – A notice of motion cannot reopen a concluded matter - Notices of motion can only be brought on the basis of a current proceeding – Correct and proper remedy lies in fresh proceedings alleging fraud or misrepresentation or lack of authority or by review to the Supreme Court – Notice of motion seeking to set aside an otherwise concluded matter is irregular and misconceived and liable for dismissal – Application to set aside consent order dismissed.

PRACTICE & PROCEDURE – Amended notice of motions – Practice of filing and proceeding on the basis of – No provision in the Rules – Practice is irregular and should cease immediately to avoid continuing in irregularity.

INTERPRETATION - “Interlocutory application” - An application that can be made during the currency of a proceeding to deal with any interlocutory matter prior to a final determination of the issues presented in the case – National Court Rules, O.4, rr 4 and 37.

Papua New Guinea Cases cited:
Aloysius Eviaisa v. Sir Mekere Morauta (2001) N2144.
Boyope Pere v. Emmanuel Niningi (2003) SC711.
Griffin vs. Westpac Bank (PNG) Limited [1993] PNGLR 353.
Henganofi Development Corporation Ltd v. POSFB (2010) SC1025.
Hilary Singat v Commissioner of Police (2008) SC910.
Joseph Kupo v. Steven Raphael, Secretary for the Department of Defence Force (2004) SC751.
Motor Vehicles Insurance (PNG) Trust v. Kulubula Salem [1991] PNGLR 305.
Manorburn Earthmoving Ltd v. The State (No 2) (2008) N3287 Manorburn Earthmoving Ltd v. The State (No 2) (2008) N3287.
Paul Torato & Ors v. Sir Tei Abal & Ors [1987] PNGLR 403.
Peter Lipsey v. The Independent State of Papua New Guinea [1993] PNGLR 405.
PNG National Stevedores Pty Ltd and Bank South Pacific Ltd v. The Honourable Andrew Baing & Ors; PNG Harbours Board v PNG National Stevedores Pty Ltd N1705. 
Rimbink Pato v. The Hon Sir Julius Chan, Prime Minister of Papua New Guinea, & Others (1997) SC527.
Richard Dennis Wallbank and Jeanette Minifie v. The Independent State of Papua New Guinea [1994] PNGLR 78.
Simon Mali v. The State (2012) SC690.
Sir Julius Chan v. The Ombudsman Commission (1998) N1738.
Rage Augerea v. The Bank South Pacific Ltd (2007) SC869.
The Honourable Andrew Baing & Anor v. PNG National Stevedores & Ors SC627.

Overseas Cases Cited:

O’Reilly v. Mackman [1982] 3 All ER 1124.

Legislation and other material cited:

http://legal-dictionary.thefreedictionary.com.
Australian Commonwealth Corporations Act 2001.

Counsel:

I. Mambei, for the Applicants.
D. Levi, for the Respondents.

4th April 2016 

1.	KANDAKASI J:  By notice of motion filed on 29th September 2014 and later amended on 22nd April 2015, the Applicants, Harry Tovon and others (Applicants) are seeking to set aside an order made on 6th June 2014, with the consent of all of the parties. The consent order finalized the proceedings. By the time the parties argued the motion, some of the Plaintiffs in the original proceedings accepted the settlement of their claims by the consent orders and concluded their claims against the State by accepting their share of the judgment sum. The Applicants claim they did not instruct their then lawyers to consent to terms set out in the consent order. This claim is seriously contested by the defendants. The Applicants' former lawyers have not been named and heard in the application. Also, neither of the parties obtained and filed any affidavit from the Applicants' former lawyers addressing the issue at hand.

2.	The above gives rise to four (4) key questions for the Court to consider and determine. These are:

(1)	Whether a notice of motion is the correct mode to seek a set aside of a consent order that resolves and finalizes a proceeding?

(2)	If the answer to question (1) is in the negative, what is the correct mode or process to use?
		
(3)	Subject to answers to the first two questions, how should the court consider and determine the factual foundation for the application that is seriously in contest? 

(4)	Substantively, have the applicants made out a case for a grant of their application?

3.	I will deal with the first two (2) questions together first. Thereafter, I will deal with the third and fourth question.

Background

4.	But first an outline of the background giving rise to the application is necessary. The Papua New Guinea Defence Force (Force) discharged the Plaintiffs (ex-servicemen) which included the Applicants from the Force between 1999 and 2000. Through this proceeding however, they claimed that their discharge was unlawful and contrary to the Force's Manual of Personal Administration. Early on in the proceeding, it was clear that the Force had not properly calculated and paid over to the ex-servicemen their dues. Pending a proper consideration and settlement or determination of the proceedings, the Court issued interim restraining orders against the Force and the State and ordered the Plaintiffs to remain on the payroll and reside at the Force's Taurama Barracks. After much going back and forth on several out of Court settlement attempts including mediation resulting in agreement on the heads of damages, the parties reached settlement in June 2014 mainly on the then remaining issue of the quantum or damages. The settlement came about quite quickly when Manase & Co. Lawyers were briefed and or instructed by the State to act for it. This saw the entry of orders by consent in the following pertinent terms: 

"1.	The Interim Orders of 14th December 2006 are hereby discharged forthwith.

2.	Judgment is entered for the Plaintiffs against the Defendants in the total sum of K6, 468,576.67 being for retrenchment and discharge entitlements including the repatriation costs and back-dated salaries from 2006 to 2001 all up.

3.	The Papua New Guinea Defence Force (PNGDF) pay all the 57 Plaintiffs herein the Judgment sum referred to in term 2 above within 30 days from the date of this Order.

4.	The Plaintiffs shall vacate the PNGDF institutional homes at Taurama Barracks in Port Moresby within 30 days after they receive their payments.

5.	Failure to comply with term 4 of the Court Order herein by the Plaintiffs will result in the immediate eviction of the Plaintiffs by the PNGDF without further notice."

5.	These orders were made on 06th June 2014 and formally entered on 10th June 2014. Following delays in payment and the ex-servicemen vacating their occupation of the Force's accommodation as well as an application by the ex-servicemen to restrain their eviction until full payment of their settlement monies, the parties entered into a further consent order made on 10th and entered on 15th September 2014. That order required the State to complete the payments by 12pm on Friday 12th September 2014, the banks to facilitate expedited clearance of the settlement cheques, the ex-servicemen to vacate the Force's barracks by 30th September 2014 and restraint both the State and the Force from evicting the ex-servicemen before then.

6.	The Plaintiffs changed their lawyers to Solwai Lawyers and started to take issue with the orders of 6th June 2014 and sought to have them set aside. This saw a filing of their initial motion, document number 74 on 29th September 2014. The following were stipulated as the grounds for their motion:

"(a)	There were errors and omissions procedurally on the face of the record in that the Former Plaintiff Lawyers Steeles Lawyers and Defendants' Lawyers Manase Lawyers failed to obtained letter of instructions or an instrument attested by all 56 named Plaintiffs of their consent to the consent orders of 6th June 2014.

(b)	Manase Lawyers Principal Mr. Alfred Manase was a former Lawyer on the record for the Plaintiffs whilst in the employ of Steeles Lawyers now acts for the Defendants has serious conflict of interest in this matter.

(c)	The Consent Orders were bulldozed by duress and were not reflective of this Court's orders of 14th December 2006 by Justice Ambeng Kandakasi."	

7.	Later on 22nd April 2015, the Plaintiffs purported to amend their motion by filing and serving an amended motion. The amended motion in relevant parts pleads the decision in Simon Mali v. The State as an additional jurisdictional foundation for their motion and amends the grounds for their motion to read:

"(a)	There was procedural irregularity on the face of the record in that the Former Plaintiff Lawyers Steeles Lawyers and Defendants' Lawyers Manase Lawyers failed to obtained letter of instructions or an instrument attested by all 56 named Plaintiffs of their consent to the consent orders of 6th June 2014 filed in court.

(b)	Manase Lawyers Principal Mr. Alfred Manase was a former Lawyer on the record for the Plaintiffs whilst in the employ of Steeles Lawyers but now acts for the Defendants and so he has serious conflict of interest in this matter in that paragraph 5 of the said consent orders says that the Plaintiffs to pay Defendants' costs in the sum global sum of K200,000.00 into Manase & Co Lawyers reflects that conflict of interest and the terms of orders manifested in favour of both Law Firms rather than the wishes of the Plaintiffs.

(c)	The Consent Orders were bulldozed by duress and were not reflective of this Court's orders of 14th December 2006 by Justice Ambeng Kandakasi and not with the NEC Decision Nos. 25/96 and the Defence Force Manual of Personnel Administration and based on the Plaintiffs calculations their claim is in excess of K20 Million.

(d)	Sgt. Joe Keithy, Regiment No. 83363 and Sgt. AK Napana, Regiment No.85506 who were part of the 58 Plaintiffs retrenched in year 2000, interest were not represented in the payout calculations reflected in the Consent Orders of 06th June 2014 and they had not given their consent and that prejudiced their prospects of claiming their final entitlements.

(e)	Consent Orders committing the State must be signed by the Solicitor General for Papua New Guinea pursuant to Section 13 of the Attorney General's Act, 1989 and not any other person including the Attorney General of Papua New Guinea or a private law firm being briefed the carriage of the case. In this case, consent orders were signed by David Levi of Manase & Company Lawyers, a private law firm, even without evidence of any written instructions from the Solicitor General

Preliminary Point

8.	Before proceeding any further, I deal quickly with a preliminary point. This concerns the ready filing, serving and proceeding on the basis of amended notices of motions by many parties through their lawyers. This is procedurally incorrect. Unlike the provisions dealing with amendment of pleadings under O. 8, rr. 50 and 51, there is no such provision in the National Court Rules (Rules) for a party to file and proceed on the basis of an amended notice of motion. What this means is that, should there be a change regarding the basis upon which a particular relief in a notice of motion is sought or the kind of relief sought changes so much so that the motion cannot be moved on the basis of the original notice, the motion should be withdrawn and a new one filed in its stead, incorporating the changes required. Persisting on the current practice of simply filing an amended notice of motion with the tacit approval of the Court is licensing a process that is not authorized by the Rules. I suggest in the strongest term possible that, this practice cease immediately to avoid continuance in irregularity. 

9.	For the case before me, I heard the parties through their respective counsel on the basis of the amended notice of motion filed on 22nd April 2015. As the point just made in the above has not been made anywhere else before, I will not apply it in this case. In future however, lawyers and parties will have sufficient notice and will have no excuse. Hence, the Court will not allow parties and lawyers to continue with this otherwise irregular practice.

Whether a notice of motion is the correct mode to seek a set aside of a consent order that resolves and finalizes a proceeding?

10.	Having dealt with the preliminary issue, let me now turn to the questions before the Court starting with the first question first. The question asks if a notice of motion is a correct process or mode to use to seek a set aside of a consent order that finalizes a proceeding. My answer is a simple no. A notice of motion cannot activate a matter concluded either by a consent order or by judgment and or order of the Court. The reason for this is simple.

11.	Firstly, O. 4 r. 4 of the Rules provides for motions in this terms:

"4.	Mode of proceedings in interlocutory matters.

Proceedings may be instituted by motion, only if they relate to an interlocutory application."

12.	Rule 37 of the same Order reiterates this position in these terms:

"37.	Interlocutory or other application in proceedings. (19/1)

An interlocutory or other application, in or for the purpose of or in relation to proceedings commenced or to be commenced by writ of summons or by originating summons, shall be made by motion."

13.	The word interlocutory comes from the word interloqui which is to say "speaking between". According to L.B. Curzon's A Dictionary of Law the term means "Not final, (ie, during the course of an action) as in an interlocutory (interim) injunction. Similarly, an internet based legal dictionary defines the word in terms of:

"Provisional; interim; temporary; not final; that which intervenes between the beginning and the end of a lawsuit or proceeding to either decide a particular point of matter that is not the final issue of the entire controversy or prevent irreparable harm during the pendency of the lawsuit."

14.	The Australian Commonwealth Corporations Act 2001, makes the position much more clearer by providing a definition for the phrase "interlocutory application to mean an application that:

(a)  is made during the course of a proceeding; and
(b)  is for an order that is incidental to the principal object of that proceeding, including, for example:

(i)  an order about the conduct of that proceeding; or
(ii)  an order assisting a party to that proceeding to present their case in that proceeding; or 
(iii)  an order protecting or otherwise dealing with property that is the subject matter of that proceeding;

but not including an order making a final determination of existing rights or liabilities."

15.	The above, sources put beyond any argument that, an "interlocutory application" is an application that can be made during the currency of a proceeding to deal with any interlocutory matter prior to a final determination of the issues presented in the case and hence a resolution of the proceedings. In other words, an interlocutory application can be made prior to the termination or conclusion of a proceeding. It follows therefore that, no motion can be filed once a proceeding has been concluded. This is understandable as an aggrieved party has recourse by way of appeals or reviews as the case might be. Order 12 r. 8 (4) strengthens this position by precluding from the reach of the National Court's power to set aside orders made even in the absence of a party where the order determines an in issue between the parties or in the proceeding or the proceedings are dismissed. The provision reads:

"(4)	In addition to its powers under Sub-rules (1), (2) and (3), the Court may, on terms, set aside or vary any order (whether or not part of a judgement) except so far as the order determines any claim for relief or determines any question (whether of fact or law or both) arising on any claim for relief and excepting an order for dismissal of proceedings or for dismissal of proceedings so far as concerns the whole or any part of any claim for relief."
(Emphasis supplied)

16.	 The position is further strengthened by the position the Supreme Court has taken of late. Through the Supreme Court, the law and practice in PNG in my view has correctly developed to the current position, where appeals from a trial court lies to an appellate court like the Supreme Court as of right, if the decision appealed from finally determines the proceedings or an issue between the parties. 

17.	In the present case, the Consent orders of June 2014, which are the subject of the Applicants' application, finally resolved these proceedings. In other words, the consent orders concluded or terminated the proceedings. Hence, there is no current proceeding upon which the Applicants can file and proceed on a motion. Order 4, r. 4 and r. 37 permits a notice of motion to commence only interlocutory proceedings in the course of pending proceedings The correct mode is either an appeal or a review or fresh proceeding claiming fraud or misrepresentation as against the consent order which finally resolved this matter and those who facilitated it. Seeking to reactivate a concluded proceeding by way of a motion is clearly unauthorized and amounts to an abuse of the process of the Court, which attracts an immediate penalty of dismissal for the protection of the Court's due processes and procedures.

18.	The second and other reason for my answering the question under consideration in the negative is this. Public policy requires finality in litigation. This principle says, subject only to one's right of appeal and review where that is available or going by the slip rule principle, there must be finality in litigation once a final decision has been arrived at or a matter before the court gets concluded. The decision of the Supreme Court in Richard Dennis Wallbank and Jeanette Minifie v. The Independent State of Papua New Guinea, stated this principle in terms of:

"…the public interest in the finality of litigation will not preclude the exceptional step of reviewing or rehearing an issue when a Court has good reason to consider that in its earlier judgment it has proceeded on a misapprehension as to the facts or the law. As this Court is a final Court of Appeal, there is no reason for it to confine the exercise of its jurisdiction in a way that would inhibit its capacity to rectify what it perceives to be, an apparent error arising from some miscarriage in its judgment. However, it must be emphasized that the jurisdiction is not to be exercised for the purpose of re-agitating arguments already considered by the Court, nor is it to be exercised simply because a party seeking a rehearing has failed to present the argument in all its aspects or as well as it might have been put. What must emerge, in order to enliven the exercise of the jurisdiction, is that the Court has apparently proceeded according to some misapprehension of the facts or the relevant law and a misapprehension cannot be attributed solely to the neglect or default of the party seeking the rehearing. The purpose of the jurisdiction is not to provide a back door method by which unsuccessful litigants can seek to re-argue their cases."

19.	As might be apparent from the Supreme Court's decision, there must be finality in litigation, subject to a rehearing in cases where for good reason an earlier decision was wrongly arrived at by reason of a misapprehension of the facts or the law. Where the error is in a decision of a final appellate or review court, correction is through the application of the slip rule principle. Where the error is at a lower trial level it is usually by appeal or review in accordance with their respective governing rules and principles and any statutory provision on point. 

20.	In this instance, the consent orders concluded the proceedings. Hence, there is no current or existing proceedings upon which the Applicants' motion could be filed and proceeded upon. A question that necessarily arises then is this. What is the correct mode to revisit an order (by consent or by order of the Court) that concludes a proceeding? That question is the subject of the second issue. 

What is the correct mode or process to use to set aside a consent order which concludes proceedings?

21.	This is not the first time the issue has arisen. Bredmeyer, J was faced with the same question in Paul Torato & Ors v. Sir Tei Abal & Ors. After considering cases on point His Honour at page 413 stated the law in these terms:

"A judgment by consent can be set aside in limited circumstances. Volume 2 of the Supreme Court Practice (1979) at pars 2010, and 2010A states;

'A consent order can be set aside in an action commenced for the purpose on any ground that would invalidate an agreement… If consent has been given by a mistake, it may be withdrawn at any time before the judgement is passed and entered…. But where a final judgment has been passed and entered the Court cannot set it aside unless a fresh action is brought for that purpose although it has been entered by mistake (Ainswort v. Wilding [1986] 1 Ch. 673 and wilding v Sanderson [1897] 2 Ch. 534'".
(Emphasis supplied)

22.	In that case, the consent judgment was formally "entered" after it was made. That was done on the same day. Application seeking to set aside that order was filed 6 weeks later not by fresh proceedings but by motion in the already concluded proceeding. The basis for the application was an allegation that the applicant's lawyer consented without the client's instruction. The Court decided against the application on the basis that the application was filed after the orders or judgement was perfected with the formal entry of the same. In so doing, the Court also observed:

"The Public interest favours the plaintiff. The order was obtained without fraud on his part of any knowledge that Gawi [defendants' lawyer] did not have authority to act for the named defendants. ….If they [defendants] have been prejudiced by the order, and can prove damage then they may be able to sue Mr. Gawi for professional negligence."

23.	Other judges in PNG have adopted and applied these principles. Justice Sheehan did that in Peter Lipsey v. The Independent State of Papua New Guinea. In that case a consent order finalized the proceeding. After a formal entry of the orders, the plaintiff applied to have them set aside also by motion. His basis for the application was also lack of instructions and thus authority in his lawyer to consent. Sheehan J., dismissed the application. In so doing, he reconfirmed that, once final judgement has been entered, the only recourse to a party aggrieved by a consent order or a judgement is to either appeal or to issue fresh proceedings on the basis of fraud or such orders or judgement being obtained by mistake. 

24.	Other local authorities include PNG National Stevedores Pty Ltd and Bank South Pacific Ltd v. The Honourable Andrew Baing & Ors; PNG Harbours Board v PNG National Stevedores Pty Ltd. That case went on appeal and the relevant judgment is The Honourable Andrew Baing & Anor v. PNG National Stevedores & Ors. The appeal was upheld on the basis that, the consent orders were not final in that, they were conditional. Once the condition occurred, further orders of the Court were required. The Supreme Court noted the principles governing a set aside of consent orders and did not reject them.

25.	In Griffin vs. Westpac Bank (PNG) Limited, the respondent or mortgagee claimed possession of a mortgage property and took out a summons for possession order. The lawyers for the mortgagee consented to the order. The mortgagee sought judicial review of the order under s.155 (2) (b) of the Constitution on the ground that the lawyers acted on his behalf without his instructions. The evidence called before the Court showed that the lawyer had no instruction to consent to the order for possession. Consequently, the Court upheld the review and set aside the consent order, on the basis that the lawyer had no authority to consent to the order. The Court there held that, it was not just to allow the consent order to stand where the lawyer purported to act on behalf of a litigant without instructions. The court at page 354 said:

"Are there cogent or convincing reasons or exceptional circumstances or any matter in the interest of justice? The point raised by the applicant is a simple one the lawyer who appeared and consented to the order had no instructions at all from the applicants. This is a very serious allegation. A lawyer on record can bind his client unless his authority is limited and the client communicates delimit to him. Where a client acts in such a way that leads his lawyer to believe has this authority, the lawyer can bind client, see Waugh vs. H.B. Clifford & Sons Limited [1982] 1 All ER 1095. In such a case, an opposing litigant is not required to prove that the lawyer has authority from his client. But the authority to bind the client is limited to the terms which do not involve extraneous matters. See Halsbury's Laws of England 4th Edition Volume 44 paragraph 166. Some of the clear examples of non extraneous matters are interlocutory proceedings to facilitate speedy resolution of the substantive issues and, hence, finality may be reached."

26.	Later in Joseph Kupo v. Steven Raphael, Secretary for the Department of Defence Force, the Supreme Court reaffirmed the law and application of the same as was done in Paul Torato & Ors v. Sir Tei Abal & Or (supra). Then specifically on the claim of lack of instructions or authority of the applicants' lawyers, the Supreme Court stated:

"Further, the evidence we have set out above shows that the allegations they have made against their former lawyer might not be sustained. Even if the allegations are true, then they had recourse to sue their previous lawyers for professional negligence. In our view a party should not seek this court's review jurisdiction where there are other remedies available. A lawyer's professional negligence should not be used to invoke s.152 (2) of the Constitution."

27.	The position taken by the Supreme Court in Joseph Kupo's cases regarding claims of lack of instructions or authority in a party's lawyer affirms earlier judicial pronouncements in PNG. A case on point is that of the National Court in Motor Vehicles Insurance (PNG) Trust v. Kulubula Salem. There Woods J., accepted the common law position that a lawyer has ostensible authority to act for and bind his client, when dealing with third parties. His Honour observed:

"The law is quite clear that solicitors and counsel have a general authority to effect a compromise in all matters connected with the suit in question and not merely collateral to it. And if they act within their apparent authority and the other party has no notice of any limitation on it the client will be bound thereby. There are numerous cases which emphasize the principle, however, I will refer to the case of Little v. Spreadbury [1910] 2 KB 658 which states as follows: 

'A client who induces his solicitor to believe that he has authority to compromise an action upon certain terms is bound by such compromise if the solicitor in making it reasonably believes that he has authority to do so although the client did not in fact intend to authorize a compromise upon those terms and did not understand the terms upon which it was proposed the compromise should be effective.'

I also refer to Halsbury's Laws of England, 4th ed, vol 44 "Solicitors", par 116 which notes that a solicitor whose name is on the record, is amongst other matters, authorized to bind his client by compromise of existing proceedings on terms which do not involve extraneous matters unless the client has limited his authority and has communicated that limitation to the other side and subject to the discretionary power of the court if its intervention by making an order is required to inquire into the circumstances and grant or withhold the intervention as it thinks fit and subject also to the client's disability."

28.	In 2008, the Supreme Court in Hilary Singat v Commissioner of Police referred to the above judgment and added: 

"22.	This is a specific application of the general principle in the law of agency or law of principals and agents. It is well settled law that, an agent as the ostensible authority to bind his principal. An agent can bind his or her principal by entering into a contract on behalf of the principal, provided the agent acts within the scope of his or her apparent or ostensible authority, even if the agent lacks actual authority and the fact of any lack in authority not being communicated to the third or other parties. The Supreme Court in Rainbow Holdings Pty Ltd v. Central Province Forest Industries Pty Ltd adopted into our jurisdiction and applied these principles.
….

24.	In our view, a lawyer who files documents in any court proceedings for and on behalf of a party or gives notice that he or she is acting for a party is deemed to have the necessary instructions if not the actual instructions, at least, his client's ostensible authority to so act. It is no light matter for a lawyer to do that, because of the penalties that can follow a lawyer who acts without instructions under the Lawyers Act and the Lawyers Professional Conduct Rules. 
	
25.	In nearly all of the known cases, the issue of authority or no authority has arisen when the principals have tried to opt out of contracts entered into on their behalf by their servants or agents having the actual if not the ostensible authority to do so. Except in cases where the other contracting party has been informed of the servants or agents lack of authority or a limit in the servant or agents authority to enter into a contract, all such attempts have failed. The decisions in the Rainbow Holdings Pty Ltd v. Central Province Forest Industries Pty Ltd and Motor Vehicles Insurance (PNG) Trust v. Kulubula Salem are good examples of this." 

29.	The Supreme Court went on to explain that:

"28.	The law or the doctrine of ostensible authority has developed in the way it has for good reason. One good reason is that, a third party or the other contracting parties or parties to Court proceedings would not be parties or privy to any contract or relationship between a lawyer and his client or an agent and his principle and communication taking place between them. It is entirely a matter between, the agent and his principal or a lawyer and his client except as the law may otherwise permit. Another good reason is that, a client in the case of a lawyer or a principal in the case of an agent acting without the appropriate and necessary instructions has recourse against his lawyer, servant or agent. The lawyer, servant and or agents can be terminated and a cause of action would accrue to the client or the principal to sue the lawyer or the servant or agent who acts without instructions. The third party, with whom the lawyer, servant and or agent may have negotiated with and entered into any agreement, would have no such recourse. A further, reason would be that, the general business efficacy including the orderly and timely handling and dispositions of cases in Court and business generally would be adversely affected by the ready undoing of contracts or steps taken on the representation of a party through his lawyer, servant or agent, and there would be no finality in sight for any litigation."

30.	In Manorburn Earthmoving Ltd v. The State (No 2) (2008) N3287 Manorburn Earthmoving Ltd v. The State (No 2), I took note of the authorities and the principles discussed above and observed:

"36.	Case law in our country and jurisdictions similar to ours is loaded with a party not being allowed to gain from his or her own failures. For example in Motor Vehicles Insurance (PNG) Trust v. Kulubala Salem,… the National Court restated the well accepted principle at common law that a lawyer is deemed to have his client's instructions when communicating with other parties or making representations in Court. As such a party cannot later hark back at his lawyer's lack of instructions and succeed on it. On the other hand, there is nothing, or if there is, the State has not drawn to my attention any authority that demonstrates a party not in fault being caused to suffer consequences not of his or her own making." 

31.	I went on to note that:

"Until the decision in the Yama Group of Companies … [National Capital District Commission v. Yama Security Services Pty Limited (2003) SC707 and National Capital District Commission v. Yama Security Services Limited (2005) SC835] cases, the Courts have always been slow to set aside, the free compromise of Court actions through negotiated outcomes, except on very limited and well recognized exceptions. The exceptions are in the main, fraud and misrepresentation leading to the compromise. Arguments against the validity of such compromises on the basis of lack of authority of one of the parties have found no favour with the Courts based on longer and deeper roots in the common law as represented by judgments in our jurisdiction such as the one in Motor Vehicles Insurance (PNG) Trust v. Kulubala Salem. That case is authority for the proposition that, a lawyer has ostensible if not expressed authority to bind his or her client. This principle has given confidence to the parties to any litigation or any negotiation to freely and fairly enter into negotiations and settle a large number of cases. Indeed as I already noted, most of the courts the world over are actively encouraging the parties to settle through their own negotiations their disputes through what has now become well entrenched and known as alternative dispute resolutions (ADR), which the Supreme Court acknowledged in its decisions in the two Yama Group of Companies cases. Despite that, the Supreme Court arrived at a decision that sends our jurisdiction miles backwards in our claims and endeavours of leading in the South Pacific jurisdictions, other than Australia and New Zealand in the development and implementation of ADR. Not only that, these decisions, has the potential to put an end to free and fearless negotiations with the State for out of court settlement of matters being brought before the Courts, which has the potential of inundating the Courts with matters that could otherwise be freely and easily negotiated and resolved out of Court through the State's legal representatives." 

32.	Earlier in Simon Mali's case, the Court had a serious case of irregularity that was apparent on the face of the record. In that case, the purported consent order was made and entered on the same day. Three months later after the Solicitor General had issued a certificate of judgment under the Claims by and Against the State Act, the State filed a motion later, seeking a set aside of the orders for serious irregularities. The trial judge granted the application and set aside the consent orders. On appeal, the Supreme Court was of the view that, the trial judge did have the necessary jurisdiction to hear and determine the motion in the way he did. The Supreme Court reasoned:

"We agree with the learned judge below that he had jurisdiction to hear and determine on the State's application to set aside. And this jurisdiction is inherent by virtue of the National Court being a court of law as envisaged by or under s.155 (4) Constitution which is in the following terms:

'Both the Supreme Court and the National Court have an inherent power to make, in such circumstances as seen to them proper orders in the nature of prerogative writs and such other orders as are necessary to do justice in the circumstances of a particular case. (emphasis added).'
	
33.	A number of factors suggestive of serious irregularity on the face of the record caused the trial judge to take that approached with the subsequent endorsement of the Supreme Court. Those factors were:

(a)	This was a class action with a number of proceedings, which did not name and include a schedule of the other plaintiffs the "principle plaintiffs" claimed to represent;

(b)	There was no written consent from each of unnamed plaintiffs authorizing the issuance of the proceedings in their behalves in an Authority to Act form pursuant to O.5, r.3 of the National Court Rules;

(c)	No lawyer for the State endorsed the draft consent orders, before the appellant's lawyer appeared before the trial judge alone and moved for the purported consent orders;

(d)		There was no evidence of the presiding judge endorsing a draft of the purported consent orders before they could be formally entered;

(e)	The presiding judge could not recollect ever endorsing any draft consent orders either in the terms of the purported consent order or otherwise;

(f)	The purported consent orders effectively contradicted an order that was in fact made to have the proceedings transferred to Waigani from Mt. Hagen, which suggested no orders finalizing the proceedings were made;

(g)	The purported consent orders were purportedly made in chambers rather than in an open court, especially when the foregoing factors existed;

(h)	There was no court file endorsement indicating what transpired in court on the relevant day; and 

(i)	The purported settlement was endorsed or approved by the Attorney General and not the Solicitor General. 

34.	The decision in Simon Mali's case could be seen as an exception to the established law and practice as represented by the earlier judgements and confirmed by the later judgments like the one in Joseph Kupo's case. Counsel for the appellant in the Simon Mali case, did ably assist the Court with the relevant submissions on the relevant law and practice regarding the setting aside of consent orders. The Supreme Court did not with respect, give any serious consideration to those submissions may be because of the number of serious irregularities that were presented on the face of the record. Hence, the Supreme Court chose to give detailed considerations to the irregularities presented as did the learned trial judgment. This approach in my humble view was required or necessitated by the particular instances of irregularity identified and sufficiently dealt with by both the trial and appellate Courts.

35.	It is also clear from a careful reading and consideration of the foregoing authorities that, no consideration was given to the question of whether an order finalizing a proceeding can be revisited by way of a notice of motion. Most of the cases calling for a revisit and setting aside of consent orders were by appeals or review applications. Only one or two of them were by motions filed and argued before the National Court. I am of the view that the position I took in the foregoing in respect of the issue under consideration remains valid in respect of orders in fact made by a judge or a court. However, where the circumstances surrounding a purported order is similar to those in the Simon Mali's case, the approach in that case should apply, especially when the application highlighting the irregularities is made before the same judge who issued the purported consent orders. This is necessary to ensure a facilitator of such irregularity or misconduct does not gain from such activities and prevent the incurrence of extra costs, wastage of time and resources of an innocent party in commencing and pursing a review or a fresh proceeding. Quicker action is also necessary to avoid any abuse and use of the Court's process and to prevent as quickly as is possible the party responsible from gaining from his unfair and illegal or improper conduct or behavior.

36.	The principles governing applications for a set aside of orders by consent which finalize any proceeding can be summarized in this way:

(a)	Like any other agreement, a consent order finalizing any proceeding that was arrived at by misrepresentation or fraud can be set aside on application of a party affected by the order;

(b)	The majority of case authorities on point stand for the proposition that, claims of lack of instructions and or authority in a party's lawyer to consent to an order cannot undo or result in a set aside of the consent order. Instead, the party concerned as a recourse against his lawyer if indeed the lawyer acted without instructions. 

(c)	The principle stated in (b) above is founded on the doctrine of ostensible authority. This is necessary for the purposes of protecting the innocent third parties and to also safeguard, protect and encourage parties to have their disputes settled through their own direct negotiations or other forms of ADR by upholding their agreement subject only to fraud and misrepresentation brought whom to the other parties which may undo them;

(d)	If the consent order is yet to be formally entered, an application by motion in the same court that made the order can be filed and pursued;

(e)	If however, the order has been formally entered, the order can be revisited only by a fresh proceeding or by an appropriate Supreme Court review application; and

(f)	There is one exception to the above. Where a serious error or irregularity is apparent on the face of the record as was the case in the Simon Mali case, the Court has power to readily deal with the matter to safeguard against any abuse of its process. 

37.	In the present case, I was the judge before whom the consent orders, the subject of this proceeding were handed up by all the parties for the Court to consider and if all in order, endorse them, which I did. Unlike the position in the Simon Mali's case:

(a)	This is a single class action which names and includes a schedule of the lead and other plaintiffs pursuing the claim against the State;

(b)	There are written consents from each of plaintiffs authorizing the issuance of the proceedings on their behalves;

(c)	This matter saw much delay in the negotiations between the parties for an outcome of court settlement until a brief out to Manase & Co., lawyers;

 (d)	Both the Applicants' and the State's lawyers on record endorsed the draft consent orders, both counsel appeared before me and moved for the consent orders;

(e)	Upon being satisfied that, all the parties through their lawyers agreed on the terms of then draft consent orders, I as the presiding judge endorsed them before they were subsequently entered on 10th June 2014;

(f)	I can clearly recall and as is confirmed by the Court file endorsements, that the draft consent orders were arrived at by the parties following directions from the Court after hearing the parties on earlier directions hearings;

(g)	I can also recall that each time the matter came before the Court, the Court room was almost always filled by the Applicants and their fellow ex-service men anxiously wishing and waiting to have their case resolved promptly;

(h)	On the days the draft consent orders were handed up and endorsed in Court, the Applicants and their fellow ex-service men attended as per usual and no one stood to object or gave any impression that he was not happy. Instead the opposite was evident;

(i)	After the initial consent orders of 6th June 2014 further consent orders on 10th September were issued. Those orders extended time for the ex-servicemen to vacate the Force's barracks and for the banks to help facilitate expedited cashing of their settlement cheques. The application to set aside the initial consent orders does not address the second set of consent orders;

(j)	As can be noted, the consent orders were all made in open Court with the ex-servicemen attending in numbers;

(k)	Court file endorsements indicate what transpired in court on the relevant dates; 

(l)	The consent orders where signed by the State's, duly appointed or briefed out lawyers Manase & Co., which consent and or endorsement is not the subject of any issue taken by the State; 

(m)	Steels lawyers acted for the ex-servicemen at the relevant time with the lawyer having carriage and conduct of the matter being Mr. Lynns. Mr Manase or his firms were not the ex-servicemen's lawyers.

38.	In the circumstances, I find that the exception introduced by the Simon Mali case does not apply here. The initial consent orders of 6th June 2014 as reaffirmed by the second set of consent orders made on 10th September 2014 remain as orders regularly made and entered. Consequently, the Applicants need to use the processes of fresh proceedings or review if they can establish fraud or misrepresentation against the State. If not, they have recourse against their former lawyers for acting without their instructions. That will give the lawyers an opportunity to be heard before there can by any judgment against them.

How should the court consider and determine the factual foundation for the application which are seriously in contest? 

39.	I will now turn to a consideration and determination of the third question. The question again is: how should the court consider and determine the factual foundation for the application which is seriously in contest? This question arises out of the serious contest on the Applicants claim of:

(a)	not having instructed their lawyer to consent to the consent orders; and

(b)	the defendant's lawyers being in a conflict of interest situation.

40.	It is well accepted that, only through proper trial with cross examination of the relevant witnesses can a court or a tribunal come to a decision on which of the facts in contest should be accepted and acted upon. This is so basic that there is no need to cite any authority. Commenting in an uncontested trial by affidavit, in Lee & Song Timber (PNG) Co Ltd v. Nathanael Burua, I observed:

"If there was a dispute, it would have necessitated a trial, with witnesses being called and cross-examined in order to determine which version of evidence to accept. I briefly discussed the need for this in Aloysius Eviaisa v. Sir Mekere Morauta Prime Minister & Ors (09/11/01) N2144. The judgement was successfully appealed against on other points…. [but] what was discussed on this issue remains unchanged. 

More recently, the Supreme Court of which I was a part, with the Chief Justice chairing and the Deputy Chief Justice being the other member of the bench, applied this principle and upheld an appeal against a National Court decision following a trial on affidavit. In that case, the primary facts were in issue and that learned trial judge proceeded to determine the case without giving the parties and itself the benefit of cross-examination and other oral evidence. That was in the case of SCR 21 of 2003 Application by Jim Nomane." 

41.	In Aloysius Eviaisa v. Sir Mekere Morauta, I was asked to rule against the cross examination of witnesses because it was a judicial review case. Counsel relied on the decision in Sir Julius Chan v. The Ombudsman Commission which cited Lord Diplock in O'Reilly v. Mackman who stated:

"… it will only be on rare occasions the interests of justice will require that leave be given for cross-examination of deponents on their affidavits in applications for judicial review. This is because of the nature of the issues that are normally raised on judicial review. The facts can seldom be a matter of relevant dispute on an application for judicial review and to allow cross examination presents the court with a temptation not always easily resisted to substitute its own review of the facts for the decision making body on whom the exclusive jurisdiction to determine the facts have been conferred by Parliament."

42.	I rejected the application on the basis that the facts in the case were seriously in dispute and the Court had to decide which version of the facts to accept to then ultimately determine the outcome of the case. This can happen only with the aid of cross examination of the relevant witnesses and their evidence. I also reasoned that, there was no blanket prohibition on the need to cross-examine witnesses in judicial review cases. 

43.	Subsequently, the Supreme Court in Rage Augerea v. The Bank South Pacific Ltd, pointed out that, controversial facts can be properly tested, clarified, tried and the correct version accepted acted upon only after a trial. There, the Court was dealing with a successful appeal against a summary judgment. It noted that there were serious issues on the provision of regular accurate monthly statements of the appellants' accounts, alleged defaults in the repayments and how the case against the appellants build up to warrant summary judgment against them. 

44.	In the present case, there are serious issues in the material aspects of whether: 

(a)	 the Applicants' instructed their then lawyers to consent to the terms of the consent orders;

(b)	The Applicants themselves participated in the proceedings and therefore knew or ought to have known of the terms of the orders and gave their consent either expressly or by necessary inference from their conduct;

(c)	 Lawyer Alfred Manase and his Manase & Co., were in a conflict of interest situation in that the lawyer allegedly acted for them; and

(d)	the Applicant made out a case of irregularity on the face of the record as it was the case in the Simon Mali's case?

45.	These facts in my view require proper testing for clarification, accuracy, credibility and acceptance before a decision could be made on the application. That can happen only on the basis of a proper pleading and trial. The pleadings would give the State and its lawyers an opportunity to file its defence, be heard on it and a final decision on the allegations arrived at. This would also give an opportunity to Applicants' former lawyers to respond to the allegations against them. That could happen only by way of fresh proceedings or an appropriate application for review by the Supreme Court. Since reviews of the decisions of the National Court are available to the Supreme Court, it would be lot better to have fresh proceedings issued out of the National Court first on the basis of fraud or misrepresentation or the Applicant's lawyers for acting without instructions. That would enable the calling of evidence for or against the allegations, cross examination, the Court's consideration and acceptance of one version of the facts it finds credible and arrive at a decision. Such a decision would be subject to further consideration by way of an appeal whereas a review application may not be able to give either of the parties a second opportunity. If however, for argument sake there is further opportunity for the parties at the Supreme Court level, it would strictly be by way of the slip rule principle. Further, empaneling a three member Supreme Court will entail delays and more costs to the Court and the parties. 

46.	Since the basis for the complaint against the consent orders in this case is mainly, the Applicants' lawyers acting without their clients' instructions, it would be a matter between the relevant lawyers and their former clients. It should not be unnecessarily dragging the State into a matter that is strictly speaking between the Applicants' and their former lawyers and yet the State be made to suffer a consequence not of its making. Instead, in accordance with the relevant principles discussed above, the State and its lawyers were entitled and did proceed on the basis of the Applicants' lawyer's representation. Whether or not the Applicants' former lawyers sought their then clients' instruction or not and whether the instructions sought were given, is a matter peculiarly within the knowledge of the Applicants' and their former lawyers. In the circumstances, issuing and pursuing fresh proceedings against the Applicants' former lawyers would be the better choice not only because of the reasons just given but also because the Applicants' former lawyers in fairness have not yet been made parties to the application and were not heard in their defence. Issuing refresh proceedings against the Applicants' former lawyers will give them the opportunity to be heard in their defence first before final judgment is arrived at. 

47.	I now turn to the fourth and final question. Have the Applicants made out a case for a grant of their application? The foregoing considerations make it clear that the Applicants failed to establish a case for the Court to grant their application and consequently set aside the consent orders. The full reason for this answer is in the foregoing discussions and findings. In short the reasons are:

(a)	The Applicants used an incorrect mode, namely a notice of motion to seek a set aside of a consent order that finalized the proceedings, leaving nothing current to support the notice of motion;

(b)	The correct mode should be a review filed and pursued at the Supreme Court or by way of a fresh proceeding claiming fraud or misrepresentation or such other improper conduct which have to be brought home against the other party, namely the State;

(c)	Since there is no allegation of fraud, misrepresentation or any improper conduct on the part of the State, which is the only other party to the proceeding, the Applicants could only pursue a proceeding based on professional negligence against their former lawyers;

(d)	Fresh proceedings against the Applicants' former lawyers is the only available option given the foregoing reasons and the Applicants' former lawyers not being made parties and given an opportunity to be heard in their defence;

(e)	Further or in the alternative, there are serious issues on the facts relied upon by the Applicants' in support of their application. These can only be resolved by a trial and not summarily on a notice of motion and affidavits alone. 

48.	For these reasons, I decline the Applicants' application and order its dismissal. Costs are ordered in favour of the State, with such costs to be agreed if not taxed. 

_____________________________________________________________________
Solwai Lawyers : Lawyers for the Applicants
Manase & Co. Lawyers : Lawyers for the Respondents