N10014

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

WS NO. 410 OF 2017

BETWEEN:
OIL PALM INDUSTRY CORPORATION
Plaintiff

V

KINA BANK LIMITED
Defendant

Waigani: Anis J
2022: 4th & 14th November

INTERLOCUTORY MATTER – application seeking leave to review a taxed costs – leave to review taxed cost of former lawyers’ of the plaintiff – taxed cost of lawyer and client or solicitor/client taxed cost unassociated to any cost awarded by the Court in the proceeding – proceeding discontinued – former lawyers of the plaintiff, upon ceasing to act for the plaintiff, issued a bill of cost for settlement – plaintiff refused to pay – former lawyers applied for taxation before the Registrar – cost taxed by the Registrar – plaintiff dissatisfied and file application under Order 22 Rule 60(2) – National Court Rules

PRACTICE & PROCEDURES – preliminary issue – whether proper mode invoked by the applicant – whether separate mode should be filed for taxation and to seek leave to review the taxed cost of lawyer/client – consideration and ruling – application of ss 62 and 63 – Lawyers Act 1986

Cases Cited:

Peter Yama v. PNGBC Limited (2008) SC922

Counsel:

K. Kil, for the Plaintiff
A. Paru, for the Defendant
B Samiat, for an interested party

RULING

14th November 2022

1.	ANIS J:  I heard arguments from the parties on a preliminary matter that was raised by the defendant.  The defendant, in response to an application filed by the plaintiff, complains of why it should continue to turn up in Court and incur cost when the proceeding had been discontinued earlier on 18 March 2020.

2.	I heard the arguments from the parties on 4 November 2022 and reserved my ruling to a date to be advised.

3.	This is my ruling.

BACKGROUND

4.	The claim concerned dispute over the withdrawal process of an interest-bearing deposit account (IBD) of the plaintiff that was held by the defendant. The plaintiff had deposited K1,000,000 to be held in its IBD for a period of 6 months.  It had tried to withdraw the funds outside the terms and conditions of the IBD account as required by the defendant.  When its request was denied or met with further inquiries, it filed this proceeding.  The matter was later resolved, and formal orders of discontinuance was made on 18 March 2020.

5.	The plaintiff’s initial lawyers were Holingu Lawyers (HL).  Prior to the proceeding being discontinued, on 29 January 2020, the plaintiff terminated HL as its lawyers.  On 18 March 2020, which was also the date when the matter was discontinued, HL filed their Notice of Ceasing to Act.  Then on 19 February 2021, HL filed and served their lawyers bill of cost and application for taxation, on the plaintiff.  On 1 September 2022, the taxing officer assessed and taxed HL’s bill of cost.  A day later on 2 September 2022, the taxing officer issued a certificate of taxation for a taxed cost sum of K79,420.48.  And on 5 September 2022, HL served the certificate of taxation on the plaintiff.

6.	In response to that, the plaintiff files this present notice of motion, that is, under this discontinued proceeding.

NOTICE OF MOTION

7.	The main relief sought in the notice of motion (filed on 10 October 2022) (NoM) is this:

“Pursuant to Order 22 rule 60(2) of the National Court Rules and section 155(4) of the Constitution, the plaintiff be granted leave to file this application for review of taxation and that taxation of Holingu Lawyers costs in the sum of K79,420.48 be reviewed and be discontinued.”

8.	I note and remark that the relief sought and as stated appears misleading.  The plaintiff is not seeking leave but rather extension of time to review the decision of the taxing officer.

PRELIMINARY ISSUE

9.	The defendant questions the jurisdiction and mode of proceeding herein.  Counsel Mr Paru submits that the proper process should have been for the plaintiff or HL to file a separate MP proceeding to seek review or extension of time to review HL’s taxed cost.  Counsel submits that HL and the plaintiff cannot apply for taxation of bill of cost (i.e., solicitor and client’s cost) and seek review, as they both have done so respectively, because this proceeding has already concluded; that it was discontinued 2 years earlier on 18 March 2020.

10.	I note the submissions of the parties.

COMPETENCY OF THE NoM

11.	When I consider the NoM, I note that it is filed as an interlocutory application.  That in itself, in my view, is fatal.  

12.	In general, all interlocutory applications or notices of motion in a proceeding may be filed whilst the proceeding is pending and has not been decided.  The current proceeding was discontinued 2 years 7 months ago.  As such, there is no platform that exists where the NoM could be filed under.  The substantive issues in this proceeding including cost, have been resolved and fully settled.  The disputed bill of cost of the plaintiff’s former lawyers HL (which has been taxed and which the plaintiff now intends to review subject to extension of time being granted) concerns lawyers’ or solicitors’ cost incurred which is governed under Part VI of the Lawyers Act 1986 (LA).  Consequently, and further to the above, the disputing parties therein are also different, namely, HL and the plaintiff (the disputing parties).  

13.	So, if I can summarise, not only are the disputing parties using an incorrect mode to commence taxation and now this intended review, but they are hopping or preying on a separate proceeding which is ‘dead’, so to speak, to pursue their grievances.  The ‘dead proceeding’ referred to is this proceeding.

14.	I would therefore dismiss the plaintiff’s NoM and HL taxed costs, for these reasons.  

15.	But that is not all.

MODE OF PROCEEDING

16.	There is a further fundamental reason (based on the preliminary or jurisdictional consideration) why I should dismiss the NoM as well as the taxed costs that has been made by the taxing officer, which is this.  The application for taxation is flawed from the start.  HL were not parties to the proceeding.  Secondly, their request for taxation of their bill of cost was supposed to have been made pursuant to s 63(1) of the LA.  The applicable rules to that include Order 22 Rule 47 and 60(1) & (2) of the National Court Rules (NCR).  

17.	These provisions are set out herein as follows:

“63.  TAXATION ON APPLICATION OF PARTY CHARGEABLE OR LAWYER.

“(1)  On application at any time by a lawyer who has delivered a bill of costs as required by Section 62(4)(b), the Registrar shall order that the bill be taxed.”
……

“47. Application for taxation under Section 63 of the Lawyers Act.

(1)  This rule applies to proceedings for the taxation of costs under Section 63 of the Lawyers Act 1986.

(2)  An application to the Court under Section 63 of the Lawyers Act 1986 shall be made in writing and shall be filed.

(3)  The bill to be taxed and a copy of it shall be annexed to the application.

(4) A copy of the application shall be served by the person seeking the taxation on the lawyer who rendered the bill.

(5)  The succeeding rules of this Division shall apply to an order that the bill be taxed in the same manner as they apply to an application under Rule 46, with such modifications as are necessary.” [Underlining mine]
……

“60. Application for review of taxation. (U.K. 62/33)

(1) Any party to any taxation proceedings who is dissatisfied with the allowance or disallowance in whole or in part of any item by the taxing officer, or with the amount allowed by the taxing officer in respect of any item, may apply on motion to a Judge to review the decision in respect of that item.

(2) An application for review of the taxing officer's decision shall be made within 14 days after the date of the decision objected to or within such further time as the Court may allow.” [Underlining mine]

18.	Evidence of the taxation including the taxable bill of cost and the certificate of taxation of the bill of cost of HL, were adduced in evidence and were brought to the attention of the Court.

19.	I observe that HL had applied to the Registrar with their bill of cost in taxable form, as if their application was made pursuant to s 63(1) of the LA.  Despite their said intention as it seemed, the fact of the matter is that they had used an incorrect mode to lodge their application.  I say this because they had not applied to the Registrar by filing a separate application, namely, an MP proceeding where they would name themselves and the plaintiff as parties to the application for taxation.  That would have been the correct mode to use to apply to the Registrar for taxation which is the practice.  Instead, they prepared and filed their application to have their solicitors’ or lawyers’ bill of cost taxed under this proceeding, namely, WS No 410 of 2017 – Oil Palm Industry Corporation v. Kina Bank Limited.  It is imperative to note that the process for solicitors’ or lawyers’ bill of cost to their client(s) that is issued and later filed for taxation under ss 62 and 63 of the LA, is different and separate from court ordered costs that are subject to taxation.  See case: Peter Yama v. PNGBC Limited (2008) SC922 (at paras 8, 9 and 10).  In regard to the latter, the parties to the proceeding are permitted to use their existing proceeding as the mode to apply to have their costs taxed before the Registrar or the taxing officer which may later be subject to review before a National Court judge.  However, in regard to the former or taxation of costs that are intended under s 63(1) of the LA, they shall be treated separately; they ought not be filed under or by using any existing or completed proceeding.  Rather, they should be filed separately before the Registrar under Miscellaneous Proceedings (MP).  These have been the practice in this jurisdiction, and in this case, I see no reason why I should take a different approach.  

20.	What transpired here is this.  HL applied for taxation of their bill of cost under this proceeding which had already concluded.  The Registrar should have rejected the application outright as improper and wanting in jurisdiction.  Instead, the Registrar (or the taxing officer) accepted the application and proceeded with taxation under this fundamentally flawed mode.

21.	To me, what this means is that no valid taxation had been conducted in regard to HL’s bill of costs.  As such, the taxation hearing, the issued certificate of taxation, and the NoM are all invalid.

SUMMARY

22.	In summary, I will order the dismissal of the application for taxation filed by HL.  I will also dismiss the taxed costs and the certificate of taxation that was issued by the taxing officer.  I will also dismiss the plaintiff’s NoM.

COST

23.	I will make no order on cost.   

24.	This proceeding is not alive, so to speak, where orders of cost may be made under.  To do so itself, in my view, would be an abuse of the Court’s power.  All the parties who have appeared and have participated herein have done so at their own accord or peril in terms of cost.  But I say this with respect especially to the defendant who, for this very reason, has raised this preliminary issue and have assisted the Court to which I am grateful.  I cannot emphasis enough the role of lawyers as officers of the Court.  In this case, counsel for the defendant should be commended for this.

ORDERS OF THE COURT:

25.	I make the following orders:

1.	The application for taxation filed by Holingu Lawyers, the taxation of Holingu Lawyers’ bill of cost, the certificate of taxation issued by the taxing officer for the sum of K79,420.48, and the plaintiff’s notice of motion filed on 10 October 2022 are dismissed.  

2.	I make no order as to costs.

3.	Time for entry of these orders is abridged to the date and time of settlement by the Registrar which shall take place forthwith.

The Court orders accordingly.
________________________________________________________________
Nicholas Tame Lawyers:	Lawyers for the Plaintiff
O’Briens Lawyers:	Lawyers for the Defendant
Holingu Lawyers:	Interested party