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B &amp M Engineering Ltd v Westpac Bank - PNG Ltd [2021] PGNC 480; N9341 (1 December 2021)

N9341

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS NO. 366 0F 2015

B & M ENGINEERING LIMITED
Plaintiff

V

WESTPAC BANK – PNG LIMITED
Defendant

Mt. Hagen: Eliakim AJ
2021:20^th, 23^rd September & 01^st December

PRACTICE AND PROCEDURE – effect of discontinuance – proceedings at an end – O.8 r.66 of the National court Rules - Defendant at liberty to file fresh proceedings to enforce terms of consent orders.

Cases Cited
Kemesi -v- Walambo (2006) N3069
Umbu -v- Steamships Ltd (2004) N2738
Papua New Guinea Banking Corporation -v- Amevo & Bari Investments [1998] PNGLR 240

Counsel
Ms. N. Noringi, for the Plaintiff
Ms. E. Noki, for the Defendant

RULING

1^st December, 2021

1. ELIAKIM AJ: The defendant applied for vacant possession of the property described as Allotment 12 Section 45, Dei Place, Mt Hagen, Western Highlands Province, on 23 August 2021. Its application was contested.
   

Background

2. The plaintiff obtained loans from the defendant and gave security over four of its properties including the property described as Allotment 12 Section 45, Dei Place, Mt Hagen, Western Highlands Province.
   
3. The plaintiff defaulted on the loan agreement and as such, the defendant exercised its rights to foreclose.
   
4. The plaintiff then filed this proceeding seeking certain declaratory orders as well as seeking an injunction against the sale. However, the parties reached consensus resulting in consent orders endorsed by this Court on 17 July 2015:
   
   1. “The Defendant shall obtain valuation for the four (4) properties described as Allotment 07 Section 39, Rui Place Mt Hagen; Allotment 12 Section 45 Dei Place, Mt Hagen; Allotment 17 Section 45, Dei Place, Mt Hagen and Allotment 20 Section 58, Corner of Minimp Road & Rot Place, Mt Hagen.
   2. The Defendant shall advertise for sale by tender the four (4) properties referred to in Order 1 above with proper descriptions of the respective properties.
3. The Defendant shall sell the two (2) properties described as Allotment 20 Section 58, Corner of Minimp Road & Rot Place, Mt Hagen and Allotment 07 Section 39, Rui Place Mt Hagen.
4. If the proceeds of the sale of the two (2) properties referred to in Order 3 above are not sufficient to clear or pay off the Plaintiff’s loan with the Defendant, then the Plaintiff shall clear or pay-off the balance of the loan outstanding within seven (7) days.
   5. If the Plaintiff fails to settle or pay-off the loan outstanding within seven (7) days pursuant to Order 4 above, the Defendant shall be at liberty to sell the property described as Allotment 12 Section 45 Dei Place, Mt Hagen.
   6. If after the sale of the property referred to in Order 5 above, the loan is not cleared or paid off, the Plaintiff shall clear or pay-off the loan outstanding within seven (7) days.
   7. If the Plaintiff fails to clear or pay-off the loan outstanding pursuant to Order 6 above, the Defendant shall be at liberty to sell the property described as Allotment 17 Section 45, Dei Place, Mt Hagen.
   8. If the Defendant is prevented by any reason whatsoever that cannot be addressed by the Defendant as a mortgagee by legal redress in court from selling or completing the sale of any of the properties in the order referred to in Orders 3,4,5,6 & 7 above, the Defendant shall, after giving notice to the Plaintiff to clear or pay off the loan outstanding within seven (7) days, be at liberty to sell any of the properties referred to in Order 1 above.
   9. The Plaintiff shall discontinue this proceeding forthwith.
   10. The Defendant shall pay the Plaintiff’s cost of the proceedings if not agreed, to be taxed.”
       
5. These orders have not been varied or set aside.
   
6. On 27 July 2015 the plaintiff filed a Notice of Discontinuance.
   
7. Orders 1 – 4 of 17 July 2015 has been complied with.
   
8. In compliance with Consent Order 5, the defendants have signed a Contract for Sale and Transfer Instrument for property described as Allotment 12 Section 45, Dei Place, Mt Hagen, Western Highlands Province.
   
9. The defendants now apply for vacant possession.
   
10. The following is sought in the defendant’s Notice of Motion:
    
    1. Pursuant to the Consent Order of 17 July 2015 and section 74(1)(c) of the Land Registration Act, Chapter No.191, the Plaintiff and its agents, servants or occupants of the property described as Allotment 12 Section 45, Dei Place, Mt Hagen, Western Highlands Province give vacant possession of the property to the Defendant within 14 days.
    2. An order that any member of the Royal Papua New Guinea Constabulary be at liberty to enter onto the property and evict the plaintiff or any persons occupying the property if the plaintiff fails to give vacant possession to the Defendant.
    3. An Order that the Plaintiff pay the Defendant’s costs.
    4. Such further or other orders as this Honorable court deems appropriate.
       
11. It is necessary to consider for the purpose of the application, the effect of the Notice of Discontinuance filed by the plaintiff on 27 July 2015.
    
12. Ms. Noki, for the defendant acknowledges the Notice of Discontinuance and submitted that although the proceeding is effectively discontinued, it is subject to the other orders being complied with. She later conceded that the orders did not specifically state that discontinuance was subject to compliance of the other orders.
    
13. She further submitted that her clients are only seeking enforcement of the Consent Orders of July 2015 which has never been set aside nor varied, and as such still valid and enforceable.
    
14. Ms. Noringi on the other hand, submits that the defendant’s Notice of Motion is not properly before the court as the Notice of Discountenance filed 27 July 2015, has brought this proceeding to an end. This therefore is tantamount to an abuse of court process and the applicant will have to initiate new proceedings to enforce the consent orders.
    

The Law and its Application

15. Order 8 Rule 61 of the NCR provides that a proceeding may be discontinued either with or without leave or with the consent of the other party.
    
16. Order 8 r.66 of the National Court Rules, (‘NCR’) reads:
    

"66. Effect of Discontinuance

A discontinuance under this Division as to any cause of action shall not, subject to the terms of any leave to discontinue, be a defence to proceedings for the same, or substantially the same, cause of action.”

17. Davani J in Kemesi -v- Walambo [2006] PGNC 65; N3069; made reference to and relied on the analysis on the rules of civil procedure described in "Australian Civil Procedure" (Third Edition) at pg. 397:
    

The effect of the discontinuance of an action is not the same as judgment. New proceedings are allowed on the same cause of action...... A discontinuance is not the same as a stay. While it seems that a stay may be lifted in proper circumstances, a valid discontinuance puts an end to the action. The defendant makes and enforces payment of costs. But apart from that the action is at an end once it is discontinued. The effect is the same whether the action is discontinued with or without leave.”

18. In this proceeding therefore, the effect of the discontinuance is such that the plaintiff is restricted to what it may do by way of further steps in the action. The defendant however has other options available in terms of enforcing the Consent Orders of 17 July 2015.
    
19. I am reminded that parties in the current proceeding, apart from the other terms of the Order, have also consented to Discontinuance of the proceeding on 17 July 2015.
    
20. There is no contention to the Notice of Discontinuance filed by the plaintiff nor is there any application before me claiming irregularity in its filing.
    
21. The proceeding OS.366 of 2015 is therefore brought to an end at the filing of the Notice of Discontinuance on 27 July 2015, which is valid in all respects.
    

ORDERS

1. The proceeding OS.366 of 2015 is effectively discontinued as at 27 July 2015.
2. The defendant’s notice of motion dated 18 August 2021 is irregularly filed and is therefore dismissed.
3. The defendant shall pay the plaintiff’s costs of the notice of motion filed 23/08/21 in the fixed sum of K1,000.
4. Time shall be abridged to time of settlement to take place forthwith.
   

________________________________________________________________

Tamutai Lawyers: Lawyers for the Plaintiff

Bradshaw Lawyers: Lawyers for the Defendant