N8326

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

W.S.NO. 1471 OF 2010

BETWEEN:
MOSES MIRIA REUBEN
Plaintiff

AND:
DONALD JACK, PRESIDENT – BEN MOIDE SOLDIER’S CLUB INC.
First Defendant

AND:
BEN MOIDE SOLDIER’S CLUB INC
Second Defendant

Waigani:  Kariko, J
2016: 7th December
2020: 1st June

JUDGMENTS AND ORDERS – enforcement of judgment - plaintiff obtained default judgment against defendants for payment of monies claimed as financial loss – financial loss incurred as a result of cancellation of fundraising event – plaintiff unable to be paid judgment sum even after attempts made to enforce judgment – plaintiff seeks substituted performance under O13 r8(1)(a) National Court Rules – no reported judgments for substituted performance in PNG - payment cannot be derived from funds of the State as that would be contrary to s.13 Claims By and Against the State Act 1996, which prohibits execution or attachment against the revenue of the State -  officers cannot be ordered to make payment from their personal finances – claim dismissed

Cases Cited:
Papua New Guinea Cases

Nil

Overseas Cases

Australian Competition and Australian Competition and Consumer Commission v Purple Harmony Plates Pty Ltd (No 3) [2002] FCA 1487
Banking Corporation v Sumitomo Mitsui Financial Group Pty Ltd (No 2) [2009] FCA 496
Deputy Commissioner of Taxation v Vasiliades [2015] FCA 854 and Sumitomo Mitsui 
Eurobodalla Shire Council v Gerondal (No 3) [2012] NSWLEC 46
Speedo Holdings BV v Evans (No 2) [2011] FCA 1227 
Wollongong City Council v Falamaki (No 3) [2009] NSWLEC 80

PNG Legislation

Claims By and Against the State Act 1996
National Court Rules

Overseas Legislation

Federal Court Rules 
Federal Court Rules 2011 (Cth) (Australia) 
Uniform Civil Procedure Rules 2005 (NSW)

Counsel

Mr T Ilaisa, for the Plaintiff/Applicant
Mr R Yamahani, for the Defendants/Respondents

JUDGEMENT

1st June, 2020 

1.	KARIKO, J: The plaintiff obtained default judgement on 2nd May 2011 against “..the 1st and 2nd Defendants in the Sum of K38,130.00 plus interest at 8% from the date of the Judgement” (Judgement). 

2.	The defendants are the Ben Moide Soldier’s Club Inc. (the Club) and Jack Donald, the President of the Club at the time the plaintiff’s claim arose. 

3.	The plaintiff’s suit is based on the financial loss suffered following the cancellation of a fund-raising event he and his musical band organized for the launching of their musical DVD at the Club, after the function was disrupted by members of the Club. 

4.	After obtaining judgement, the plaintiff made attempts to enforce the Judgement, by way of garnishee and writ of levy of property, but without success. An application to have the defendants found guilty of contempt was dismissed. There was also an attempt at a compromised settlement but that has also failed with the plaintiff refusing the offers of settlement from the defendants through the Papua New Guinea Defence Force (PNGDF).

5.	The plaintiff subsequently filed a notice of motion on 28th July 2016 applying for, among others, substituted performance under O13 r8(1)(a) National Court Rules, and have the PNGDF Commanding Officer of Murray Barracks “ensure compliance” of the Judgement. 

Notice of motion

6.	Summarized, the notice of motion seeks:

(1)	An order pursuant to O13 r8(1)(a) for an order that the Commanding Officer of Murray Barracks ensure compliance with the order for default judgment;
(2)	Alternatively, an order pursuant to O13 r9(2) for the order for default judgment to be enforced against the Commanding Officer of Murray Barracks; and
(3)	An order to transfer of the proceeding to a Defence Force Judge for enforcement of the orders.

7.	The plaintiff did not offer any submissions on the second relief sought so I view that application as abandoned. As to the third relief pleaded, that was withdrawn.

Issue

8.	Is this a proper case for enforcement of a judgement by substituted performance? 

The law

9.	Order 13 rule 8 states:

8. Substituted performance
(1) Where a judgment or order requires the person bound to do an act and the person bound does not do the act, the Court may-
(a) direct that the act be done by a person appointed by the Court; and
(b) order the person bound to pay the costs incurred pursuant to the directions.
(2) Sub-rule (1) does not affect- 
(a)	any other powers of the Court relating to the execution of instruments by order of the Court; or
(b)	the powers of the Court to punish for contempt. 
(My underlining)

10.	There is no reported judgement in this jurisdiction that has considered this provision. 

11.	In support of his client’s application, Mr Ilaisa for the plaintiff referred to two Australian Federal Court cases – Deputy Commissioner of Taxation v Vasiliades [2015] FCA 854 and Sumitomo Mitsui Banking Corporation v Sumitomo Mitsui Financial Group Pty Ltd (No 2) [2009] FCA 496 – that discuss substituted performance under the Federal Court Rules. 

12.	Sumitomo concerned a case of passing off, whereby the respondent registered as a corporation with a name deceptively similar to the applicant’s name. The respondent was ordered to change its name but failed to do so. The Court granted an application for substituted performance and ordered the respondent’s solicitor to execute all required documents to effect the change of name. The order for substituted performance was made pursuant to r41.09 of the Federal Court Rules 2011 (Cth) which provides:

(1) 	If a person (the first person) is bound, but neglects or refuses, to do an act, a party may apply to the Court for an order:
(a)	that the act be done by another person, appointed by the Court; and
(b) 	that the first person pay the costs and expenses incurred by the making of the order.
(2) 	Subrule (1) does not limit:
(a) 	the power of the Court to punish for contempt; or
(b) 	any other mode of enforcement of the judgment or order available to the party.

13.	In Vasiliades, the respondent was ordered to instruct the bank within seven days to pay to the Commissioner of Taxation, the judgment sum kept in the respondent’s bank account. The respondent failed to give that instruction and upon application, the Court ordered a registrar of the Court to execute the requisite instruction in the respondent’s name. The order for substituted performance was made under O37 r3 of the former Federal Court Rules, the predecessor of r41.09.  There is some difference in language between the current r41.09 and its predecessor O37 r3, but the effect of the provisions is the same. 

14.	The power to order substituted performance is a discretionary power, of course, to be exercised judicially. The power has been utilized to order the registrar of the courts to execute instruments for the transfer of domains, where the respondent has not done so as ordered; Speedo Holdings BV v Evans (No 2) [2011] FCA 1227 and Australian Competition and Consumer Commission v Purple Harmony Plates Pty Ltd (No 3) [2002] FCA 1487.

15.	 In New South Wales, Reg 40.8 of the Uniform Civil Procedure Rules 2005 contains a similar provision for ordering substituted performance. In Wollongong City Council v Falamaki (No 3) [2009] NSWLEC 80, the applicant was allowed to demolish a structure if the respondent failed to comply with an order to do so within a prescribed period, and in Eurobodalla Shire Council v Gerondal (No 3) [2012] NSWLEC 46, a substituted performance order was issued that permitted the applicant to remove items from the respondent’s property if she did not comply with the order for the removal.

Consideration

16.	I rely on the Australian cases for persuasive value only. Interestingly, the cases on substituted performance do not concern judgements for the payment of money. I believe this is because there are other more appropriate courses for the enforcement of such judgements, namely the means of enforcement similar to those found in O13 r2(1) National Court Rules. This Rule, which incidentally is headed “Payment of money” states that a judgement for the payment of money (not payment into court) may be enforced by any of the following:

(a)	levy of property; 
(b)	attachment of debts (garnishee); 
(c)	charging order; 
(d)	appointment of a receiver; and 
(e)	committal and sequestration.
 
17.	It is my opinion that the processes to enforce a court order for payment of money (not payment into court), are those specified under O13 r2(1).

18.	 It is clear that specific performance involves the following elements:

(a)	a judgment that requires a person to do an act; and 
(b)	that person does not do the act; then 
(c)	the court may appoint another person to do that act.
 
19.	In the present case, default judgement against the defendants infers that they are obliged to pay the judgement sum of K38,130.00 plus interest. That is, the defendants are required by the judgement to pay the money to the plaintiff. To date, the defendants have not paid that money (being the act that they were required to do pursuant to the judgement). If I were to appoint the Commanding Officer of Murray Barracks under O13 r8, he would be required to pay the debt, but is it appropriate to so order?

20.	Evidence received in this proceeding has established that the Club is a social club for recreational purposes, for non-commissioned officers of the PNGDF based at Murray Barracks. There is limited financial assistance given annually to the Club by PNGDF to help with its operations but otherwise the Club is a non-profit self-sustaining activity. Notwithstanding how it has been named as a party, the Club is in fact not registered as an incorporated body, but its operations are obviously subject to the regulations of the PNGDF and more particularly, the command of the Barracks. The Commanding Officer has supervisory control in that he is responsible for the appointment of the President of the Club and ensures the Club operates in accordance with regulations. The President holds office for a term of two years. 

21.	I do not consider it proper that the Commanding Officer of Murray Barracks or any other officer of the PNGDF should be ordered to pay the judgement sum. It has not been an issue for determination if such officers or indeed the State are vicariously liable for the acts of the defendants. In any case, the payment cannot be derived from the funds of the State as that would be contrary to s.13 Claims By and Against the State Act 1996, which prohibits execution or attachment against the revenue of the State. At the same time, the officers cannot be ordered to make payment from their personal finances. 

Conclusion

22.	While it is regrettable that the plaintiff has struggled in vain to have the judgement sum paid, the orders currently sought must necessarily be refused. In relation to costs, I consider the circumstances justify the parties bearing their own costs. 

23.	Before ending, I note that the PNGDF has made a gratuitous offer to compromise the plaintiff’s claim while not acknowledging any liability, which was rejected by the plaintiff. If that offer is still open, the plaintiff might consider revisiting it.

Order

24.	The Court orders that:

(1)	The plaintiff’s notice of motion filed 28th July 2016 is dismissed.
(2)	Parties shall pay their own costs.

_______________________________________________________________
The Public Solicitor: Lawyer for the Plaintiff/Applicant
PNGDF Legal Services: Lawyer for the Defendants/Respondents