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Tomba v Kaa [2023] PGNC 216; N10275 (30 May 2023)

N10275


PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]


WS 118 OF 2022 (IECMS-CC4)


KUNAI TOMBA


V


ANDY KAA, JACKSON TANDAWAI & FINANCE CORPORATION LIMITED


Waigani: Wawun-Kuvi, AJ
2023: 18th & 30th May


CIVIL PRACTICE AND PROCEDURE- NATIONAL COURT RULES-Summary determination- Fraud- Whether Order 12, Rule 37 (b) precludes summary disposal of claims of fraud? Order 10 Rule 9A (15) -Fraud- Whether Order 10, Rule 9A (15) can be used to summarily determine a claim of fraud?
CIVIL PRACTICE AND PROCEDURE- COMMON LAW- Estopple- Whether plaintiff estopped from bringing claim?
CIVIL PRACTICE AND PROCEDURE- COURT’S INHERENT POWERS Abuse of Process- Whether proceedings are an abuse of process?
CIVIL PRACTICE AND PROCEDURE- STATUTE- Frauds and Limitations Act 1988, section 16- Whether proceeding time barred?


Kunai Tomba (Plaintiff) claims fraud against the Defendants. He claims that the defendants, through breach of fiduciary duty, misrepresentation, deceit by forgery and unlawful conspiracy executed a mortgage deed that used his land as security. He seeks orders declaring the mortgage deed unlawful and possession of the land.

FINCORP (Third Defendant) brings a motion to dismiss. It contends that when it filed proceedings in OS 643 of 2019, the Plaintiff was given an opportunity by the Court to raise the defence which is now the basis for the claim. The Plaintiff did not avail himself of that opportunity and default judgment was entered against him. He did not challenge that decision. FINCORP says that the plaintiff is estopped from bringing the present claim, that the proceeding discloses no cause of action and is an abuse of process. It is also time barred.

Held:

  1. There is no claim requiring a trial on liability. The plaintiff’s claim is estopped because he failed to raise it as a defence in proceedings titled OS 643 of 2019.
  2. Additionally, the proceeding is an abuse as the plaintiff did not seek to set aside the Order in OS 643 of 2019 or even attempt an appeal. He waited 2 years and filed fresh proceedings.
  3. Finally, the proceeding is statute barred having been filed 9 years after the cause of action against each defendant accrued.
  4. Pursuant to Order 10, Rule 9A (15) (1) (b) (2)(d) and Order 8, Rule 27 of the National Court Rules, the proceeding is dismissed for failure to disclose a reasonable cause of action, abuse of process and being time barred.

Cases Cited:


Papua New Guinean Cases
State and Manau v Ako & Ors [2022] PGSC 131; SC2323
State v Kalaut [2022] PGSC 45; SC2246
Memkitts Investments Ltd v Aikal [2021] PGSC 109; SC2184
Atlas Corporation Ltd v Ngangan [2020] PGSC 86; SC1995
Opi v Telikom PNG Ltd (2020) N8290
Maip v Moge Nambuga Milimb Investment Ltd [2020] PGSC 161; SC1908
Angoman v Angoman [2019] PGSC 129; SC2074
Rimbunan Hijau (PNG) Ltd v Enei [2019] PGSC 73; SC1859
Nominee Niugini Limited v Independent Public Business Corporation & 2 Others (2017) SC1646
Hole v Mana [2016] PGSC 55; SC1536
Mamun Investment Ltd v Koim [2015] PGSC 9; SC1409
Lord & Company Ltd v Inapero [2014] PGSC 79; SC1624
Wamabiang v Palme [2012] PGNC 84
Oil Search Ltd v Mineral Resource Development Corporation Ltd (2010) SC1022
Paki v Motor Vehicle Insurance Ltd [2010] PGSC 2; SC1015
Timbers (PNG) Ltd v Kambori [2010] PGNC 201; N4282
State v Downer Construction (PNG) Ltd [2009] PGSC 51; SC979
Daniel v Pak Domoi Ltd (2009) SC970
Kumagai Gumi Co Ltd v National Provident Fund Board of Trustees [2006] SC837
Porgera Freighters Limited v Bank of South Pacific Limited (2004) N2662
Kappo No 5 Pty Ltd v Wong [1997] SC520


Overseas Cases
D’Orta-Ekenaike v Victoria Legal Aid [2005] HCA 12
Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45; (1981) 147 CLR 589


Legislation
Frauds and Limitations Act 1988
Reference
National Court Rules


Counsel
Mr Daniel Kop, for the Respondent/Plaintiff
Mr. Jackson Tandawai, In Person
Mr Pokup Kepiniu, for the Applicant/Third Defendant
No appearance, for the First Defendant


RULING

30th May, 2023

  1. WAWUN-KUVI, AJ: FINCORP brings a motion for summary judgment pursuant to Order 12, Rule 40 (1)(a)(b)(c) of the National Court Rules. It argues that the Plaintiff’s claim must fail on the basis that it is barred by the anshun estopple. FINCORP argues that the subject matter of the claim was already determined in a previous proceeding titled OS 643 of 2019. That the plaintiff was given opportunity to raise the defence of fraud and it failed to avail itself of that opportunity. As such there is no reasonable cause of action and the proceedings are frivolous, vexatious and an abuse of the court process.
  2. In support of the application are the affidavits of Pokup Kepiniu and Helanie Onzem, both filed on 27 April 2023.
  3. In relation to statements that were obtained from hearing of the Court recording, I do not consider the matters deposed as direct evidence of what transpired in the first proceedings. It would have been more prudent upon Mr. Kepiniu to obtain the transcripts of the proceeding rather than depose to what he had heard. Such practice is discouraged because a lawyer should never put themselves in a position where he or she may be subjected to cross examination.
  4. Moving on, the motion is opposed. The Plaintiff contends that a proceeding claiming fraud cannot be decided summarily under Order 12 Rule 37(b) of the National Court Rules. Mr. Kop made oral submissions and did not assist the Court with any case authority.
  5. The second defendant also opposes the motion. Essentially, he contends that a trial on merits will clear him of the accusations of fraud made by the plaintiff against him. He also made oral submissions and did not assist the court with relevant authorities.

Whether Order 12 Rule 37(b) prohibits the summary disposal of a claim based on an allegation for fraud?


  1. It is settled that summary disposition under Order 12, Rule 40 of the National Court Rules is not available for fraud claims. This is in accordance with Order 12, Rule 37(b) of the Rules: see Lord & Company Ltd v Inapero [2014] PGSC 79; SC1624[1] applying Wamabiang v Palme [2012] PGNC 84, Daniel v Pak Domoi Ltd (2009) SC970, Kumagai Gumi Co Ltd v National Provident Fund Board of Trustees [2006] SC837, Porgera Freighters Limited v Bank of South Pacific Limited (2004) N2662 and Kappo No 5 Pty Ltd v Wong [1997] SC520.
  2. According to the authorities, the gravity of the claim necessitates that fraud claims be tried on their merits. The Plaintiff's claim is founded on fraud. As a result, I find that FINCORP's application should be denied pursuant to Order 12 Rule 37 (b) of the National Court Rules.

I am also not convinced by Mr. Kepiniu’s contentions that Section 155(4) of the Constitution empowers the Court to circumvent Order 12, Rule 37(b).
Can I still determine the matter?


  1. Given the circumstances submitted by the 3rd Defendant, I raised with counsel whether the Court was still empowered under Order 10 Rule 9A (15) and Order 8, Rule 27 of the National Court Rules to consider issues.
  2. Mr Kepinu submits that Order 10, Rule 9A (15) entitles the Court to summarily determine the matter on its own volition and can be read in conjunction with section 155(4) of the Constitution.
  3. Mr. Kop submits that it is not open for the Court to use Order 10, Rule 9A (15) because (1) that provision is available only for listings, (2) the 3rd Defendant did not rely on it in support of its motion and (3) if the Court applied it, it would be seen to be assisting a party.
  4. I find no merit in Mr. Kop’s contention, the substantive proceeding is at the listing stage as stipulated under Rule 9A of Order 10 and it is settled that the Court is within its powers to protect its process from abuse at any stage. As was said in Nominee Niugini Limited v Independent Public Business Corporation & 2 Others (2017) SC1646[2]:

“27. The issue of competence is to do with legal and jurisdictional aspects of the court process. More often than not, this concerns the validity of the very proceedings before the court. Hence, it can be raised and determined at any state of proceedings. In Chief Collector of Taxes v Bougainville Copper Limited and Bougainville Copper Limited v Chief Collector of Taxes (2007) SC853 the Supreme Court, adopting the principle in Patterson Lowa & Ors v Wapula Akipe & Ors [1992] PNGLR 399 made that clear when it held:

“It is settled law that, the Courts have an inherent jurisdiction to watch over their processes and procedures to ensure that they are not abused. This is an issue that is always open to the court at any stage of the proceedings. As such, it does not matter whether a party appearing before the Court is raising it, because it goes into the competence of the very proceedings brought before the Court.” [Emphasis mine].


  1. Order 10 Rule 9A (15) and Order 8, Rule 27 of the National Court Rules are the procedural vehicles by which the Courts use to protect its processes from abuse.

Whether a proceeding involving a claim for fraud can be summarily dismissed pursuant to Order 10, Rule 9A (15)?


  1. The Supreme Court in Lord & Company Ltd v Inapero [2014] PGSC 79; SC1624, held:

“1. Although it was not explicitly identified, the primary judge made an order pursuant to Order 10 rule 9A (15) of the National Court Rules. “Summary disposal” of a matter pursuant to Order 10 Rule 9A (15) is not “summary judgment” within the meaning of Order 12 Division 4 National Court Rules, and Order 12 Rule 37(b) is not relevant to summary disposal of a matter in those circumstances.

2. It was open to his Honour to summarily dispose of the proceedings before him, notwithstanding that they were founded on allegations of fraud.”


  1. I have no doubt that it was never intended that cases that are obviously unmeritorious should be allowed to continue to trial, albeit based on fraud. As such Court rules like Order 10 Rule 9A (15) and Order 8, Rule 27 exist.

Are the doctrines of Res Judicata (cause of action estoppel), Issue Estoppel and Anshun Estoppel applicable?


  1. The consideration before me is one where a previous proceeding is said to have determined all rights between the parties. It is relevant for me to consider the doctrines of res judicata (cause of action estopple), issue estopple and the anshun estopple.
  2. In Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45, the Court in its majority decision, distinguished between Res Judicata (cause of action estoppel) Issue Estoppe and what is now known as Anshun Estoppel.
  3. Res judicata (cause of action estopple) arises “where a cause of action has been brought and judgement has been entered in that action, no other proceedings can thereafter be maintained on the same cause of action.”[3] In order words, res judicata operates when a party attempts to litigate the same cause of action in another proceeding.
  4. On the other hand, issue estoppel arises where a “judicial determination directly involves an issue of fact or of law disposes once and for all of the issue, so that it cannot afterwards be raised between the same parties or their privies.”[4] Issue estoppel operates when a party attempts in a second proceeding to litigate issues of fact or law already decided by a prior proceeding.[5] That is, any issues that were determined in previous proceedings cannot be the subject of fresh proceedings.
  5. Under the Anshun Estoppel a party is prevented from bringing fresh proceedings where it should have pursed its claim or issue in previous proceedings[6]: see also Atlas Corporation Ltd v Ngangan [2020] PGSC 86; SC1995 at paragraph 44.
  6. An example of the application of the Anshun estopple in this jurisdiction is found in the case of State v Downer Construction (PNG) Ltd [2009] PGSC 51; SC979[7]. Kandakasi, J (as he then was), in his dissenting judgment, considered the case of Port of Melbourne Authority v Anshun Pty Ltd[8] and other authorities and found that the State was estopped from ligating the issue of lack of section 5 notice. He ruled that the State had the opportunity to do so but did not in previous proceedings.
  7. The Court in Port of Melbourne Authority v Anshun Pty Ltd found that the abuse of process test is not a useful utility[9] but instead the relevant test is whether the result would be one where a judgement conflicts with an earlier judgement, although based on a different cause of action[10]: see also Timbers (PNG) Ltd v Kambori [2010] PGNC 201; N4282 at paragraph 9 applying Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45.
  8. Based on the foregoing, it is concluded that Res judicata and Issue estoppel deal with attempts to re-litigate previously decided matters. The Anshun Estoppel, on the other hand, deals with both causes of action or issues that were never decided in previous processes but should have been raised as either a defence or issues.
  9. I must now analyze the plaintiff’s present claim against the proceedings in OS 643 of 2019 to determine whether any of the doctrines apply.

What was the nature and outcome of OS 643 of 2019 proceedings?


  1. FINCORP commenced the proceeding titled OS 643 of 2019. The parties were Finance Corporation Limited trading as FINCORP (Plaintiff), Andy Kaa (1st Defendant) and Kunai Tomba (2nd Defendant).
  2. The subject of the proceeding was the mortgage deed executed between the parties on 12 November 2013.
  3. From paragraphs 1-4 and 9 (a) of its Originating Summons, FINCORP sought orders for vacant possession, the right to dispose of and injunctions against Kunai Tomba in respect of land located at Allotment 02 and 03, Section 364, Hohola, State Lease Volume 110 Folio 128.
  4. Paragraphs 5-8 and 9(b) were in respect of a motor vehicle described as a Ford Ranger Utility registration number HAO 418.
  5. Ms. Topo of Makap Lawyers representing Kunai Tomba filed a motion to dismiss OS 643 of 2019.
  6. On 19 February 2020, Thompson J dismissed the motion for summary determination and ordered as follows:
    1. “The 2nd Defendant’s application to dismiss the proceedings is refused.
    2. The 2nd Defendant is to pay the Plaintiff’s cost of an incidental to the motion on a party/party basis, to be agreed or taxed.
    3. Pursuant to Order 4, Rule 35, the proceedings are to continue by way of pleading in relation to the claims made in paragraphs 1-4 plus 9 (a) of the Originating Summons.
    4. The proceedings in relation to the claims made in paragraph 5-8 plus 9 (b) are to continue by way of originating summons.
    5. In relation to the claims 1-4 plus 9(a) of the Originating Summons, the Plaintiff is to file and serve a Statement of Claim within 30 days, the 2nd Defendant is to file and serve a Defence within 15 days thereafter, and the proceedings than thereafter shall continue in accordance with the National Court Rules and requirements.”
  7. Almost a year later, on March 10, 2021, Thompson, J concluded the proceeding by issuing the following order:

“1. Pursuant to Order 12, Rule 30 of the National Court Rules, judgement is entered for the Plaintiff against the Defendant for possession of land at Allotment 02 and 03, Section 364, Hohola, State Lease Volume 110 Folio 128.

2. The Defendants are to give vacant possession of the said Land to the Plaintiff within 14 days of the service of these orders.

3. Pursuant to Order 13 Rule 3 of the National Court Rules, the Plaintiff is given leave to issue a Writ of Possession to enforce the judgement possession if vacant possession is not given within 14 days of service of these orders.

4. The Defendants are to pay the plaintiff’s costs.

5. The time of entry of these orders is abridged to the time of settlement by the Registrar which shall take place forthwith.”


  1. The Order of 10 March 2021 refects that Kunai Tomba had not taken any steps to defend FINCORP's claim concerning the land located at Allotment 02 and 03, Section 364, Hohola, State Lease Volume 110 Folio 128.
  2. It is also uncontradicted that there was no application to set aside the order and no appeal. Instead, Kunai Tomba waited two years before filing a new case in WS 118 of 2023.

What is the nature of the present proceedings?


  1. Kunai Tomba filed the WS 118 of 2023 proceeding on 20 March, 2023.
  2. Except for Jackson Tandawai, the parties are the same. The claim is based on fraud. It is based on the same mortgage deed signed on 12 November, 2013.
  3. The Plaintiff's claim is that Andy Kaa is his relative and that he was residing on the property with him. Andy Kaa took the land title without his knowledge. Andy Kaa took the title to Jackson Tandawai. Jackson Tandawai was a lawyer. On November 19, 2013, Andy Kaa and Jackson Tandawai conspired and caused a letter to be sent to FINCORP. The letter informed FINCORP of the Plaintiff’s purported consent to the mortgage arrangement.
  4. Andy Kaa visited FINCORP's headquarters and met with its Chief Assets Management Officer. The Chief Asset Management Officer facilitated the loan. The land was used as security. Andy Kaa and FINCORP executed the Mortgage Deed on November 12, 2013. He was not in attendance and did not sign the Deed. Andy Kaa forged his signature.
  5. He was not aware of any activities and was surprised when he was informed by the Sheriff to give vacant possession to FINCORP.
  6. He seeks the following orders:
    1. “A declaration pursuant to s155(4) of the Constitution that the mortgage deed dated 12 November 2013 was not lawfully created under s62 of the Land Registration Act and therefore is unlawful, null and void.

2. An order pursuant to s155(4) of the Constitution and s33 of the Land Registration Act and the plaintiff Kunai Tomba holds indefensible title over the land described as Section 364 Allotments 2 & 3 Volume 110 Folio 128, Hohola, National Capital District.

3. An order consequential to terms 1 & 2 above, that the third defendant return or surrender the owner’s copy of the title of the said land to the plaintiff.

4. An order pursuant to s155(4) of the Constitution (as deterrent) that Andy Kaa, Jackson Tandawai, Adam Hughes, Millen Lewis, Fatima Moses, and Tony Wtham be referred to police for criminal prosecution.

5. Any other orders this court deems fit.

6. Cost of proceedings against defendants.”


Whether the Plaintiff is estopped from filing his claim?


  1. The doctrines of res judicata (cause of action estoppel), issue estoppel and anshun estopple exist to protect court process from abuse from the unnecessary re-litigation of proceedings. The doctrines aid the Courts to prevent multiplicity of proceedings, inconsistent or contradictory orders, wasteful use of court resources and unnecessary costs to parties.
  2. The parties to the proceedings are the same except for the addition of Jackson Tandawai in WS 118 of 2023.
  3. The two proceedings have the same underlying subject matter. Both proceedings stem from the mortgage deed executed on November 12, 2013. In OS 643 of 2019, FINCORP claimed a right of possession arising from the mortgage deed; however, in WS 118 of 2023, Kunai Tomba alleges that FINCORP has no rights because the mortgage deed was fraudulent.
  4. Currently, FINCORP holds possession of the subject land and is in the process of selling it in accordance with the Order of 10 March 2021. Kunai Tomba is requesting that the order be reversed so that he can regain possession.
  5. The present claims by Kunai Tomba were available to him in 2021 as a defence in OS 643 of 2019. He was represented by a lawyer. The Court had separated the proceeding relating to the claim for the subject land. Kunai Tomba was required to file a defence in that proceeding. He had the opportunity to file his defence and set out the matters he now claims. He did not avail himself of that opportunity.
  6. When a default judgment was entered pursuant to Order 12 Rule 30, he made no attempts to set it aside. Instead, he waited two years and then filed a new case.
  7. The fresh proceeding is clearly an attempt to re-litigate the proceeding commenced in OS 643 of 2019. To allow the proceeding to go any further would create a situation where the Court would be asked to give a conflicting or contradictory decision.
  8. For the foregoing reasons, I find that the Ashun Estopple is applicable. I find that the plaintiff’s claim for fraud is barred by the ashun estopple. As such there is no reasonable cause of action requiring a trial on liability.

Whether the proceeding is an abuse of process?


  1. I find that the circumstances also demonstrate that the plaintiff is abusing the process of the Court.
  2. The Plaintiff was given an opportunity to raise his claims as a defence, but he chose not to take up that opportunity. The consequence is that default judgement was ordered pursuant to Order 12 Rule 30 of the Rules. The option to set aside the order was available pursuant to Order 12, Rule 35 of the Rules. The plaintiff did not utilize the opportunity to set aside the order. He did not attempt an appeal. He allowed the order to stand. That order is now final. Instead, he filed fresh proceedings.
  3. I apply the statements on finality in Atlas Corporation Ltd v Ngangan [2020] PGSC 86; SC1995[11] where the Court followed the majority decision in D’Orta-Ekenaike v Victoria Legal Aid [2005] HCA 12[12] which held that: “A central and pervading tenet of the judicial system is that controversies, once resolved, are not to be reopened........ It is a tenet that underpins the extension of principles of preclusion to some circumstances where the issues raised in the later proceeding could have been raised in an earlier proceeding. The principal qualification to the general principle that controversies, once quelled, may not be reopened is provided by the appellate system. But even there, the importance of finality pervades the law. Restraints on the nature and availability of appeals, rules about what points may be taken on appeal and rules about when further evidence may be called in an appeal (in particular, the so-called “fresh evidence rule”) are all rules based on the need for finality. As was said in the joint reasons in Coulton v Holcombe: “[i]t is fundamental to the due administration of justice that the substantial issues between the parties are ordinarily settled at the trial.”
  4. I reiterate again, the plaintiff was given the opportunity to defend his claim in OS 643 of 2019. He cannot plead with the Court to not remove him from the judgement seat. To allow the plaintiff to re-litigate would amount to a waste of judicial resources, would result in contradictory or conflicting orders, would force the defendants to incur unnecessary costs and would deprive the third defendant of the fruits of the judgement in OS 643 of 2019. The proceeding is an abuse of process.

Is the action time barred?

  1. The Supreme Court in Oil Search Ltd v Mineral Resource Development Corporation Ltd (2010) SC1022 held:

“23. If a claim is clearly time-barred and provided the statutory defence is pleaded in the defence, a motion for dismissal is warranted and it would be quite appropriate for the National Court to hear and determine it. Where, however, the case for dismissal is not clear-cut, the decision-making process of first, identifying the cause of action, secondly, identifying the date on which the cause of action arose and then, deciding the question of whether the cause of action is founded on a simple contract or is an action upon a specialty, can only efficaciously be carried out at a trial.”


  1. Here, the 3rd Defendant specifically pleaded at paragraphs 7(8) and 7(9) of its Defence that the Plaintiff claim is time barred pursuant to section 16 (1)(a) of the Frauds and Limitations Act 1988. For that reason, consideration for dismissal is warranted.
  2. Section 16 (1) (a) of the Frauds and Limitations Act 1988 provides:

“16. LIMITATION OF ACTIONS IN CONTRACT, TORT, ETC.

(1) Subject to Sections 17 and 18, an action–

(a) that is founded on simple contract or on tort; or.....

..........

shall not be brought after the expiration of six years commencing on the date on which the cause of action accrued.”

  1. The plaintiff’s cause of action is based on fraud. The heads of the claim specific breach of fiduciary duty, unlawful conspiracy, deceit by forgery and fraudulent misrepresentation. He claims that Andy Kaa unlawfully conspired with Jackson Tandawai and caused to be sent the letter date 19 November 2013. The letter falsely stated that he had given consent to the mortgage arrangement. That Andy Kaa unlawfully conspired with FINCORP’s employees and executed the mortgage deed. He did not sign the mortgage deed. Andy Kaa forged his signature.
  2. The cause of action against FINCORP and Andy Kaa accrued on the date of execution of the deed which was 12 November 2013. Whilst the cause of action against Jackson Tandawai accured on or about 19 November 2013.
  3. The date of discovery is not relevant in calculating the period of limitation: see Mamun Investment Ltd v Koim [2015] PGSC 9; SC1409 (24 February 2015), State and Manau v Ako & Ors (2022) PGSC 131; SC2323 at paragraphs 53-55, Maip v Moge Nambuga Milimb Investment Ltd [2020] PGSC 161; SC1908 (20 January 2020) at paragraph 27.
  4. Whilst I accept that in certain circumstances, a cause of action may recur, this is not such a case: see Memkitts Investments Ltd v Aikal [2021] PGSC 109; SC2184 (31 December 2021). The plaintiff specifically pleads the date of the execution of the deed and the date of the letter by Jackson Tandawai as being the periods which gave rise to the cause of action.
  5. Finally, whilst counsel did not address the application of section 18 of the Frauds and Limitations Act 1988, I find it a relevant consideration as it precludes the operation of section 16. Having applied my mind to the issue, I find that it does not apply in the given circumstance. The underlying basis for any declaratory relief claimed must be based on equity. Here the underlying basis is the tort of fraud. The Supreme Court decision in Mamun Investment Ltd v Koim [2015] PGSC 9; SC1409 at paragraph 7-9 affirms this position in law.
  6. The plaintiff filed this proceeding 9 years after the cause of action accrued against each defendant. I find that the claim against all defendants is time barred.


Conclusion


  1. I am satisfied that the proceedings should be summarily dismissed.
  2. No claim exists that necessitates a liability trial. The plaintiff's claim is estopped because, despite having the chance, he chose not to provide it as a defense in OS 643 of 2019.
  3. Additionally, the proceeding is an abuse as the plaintiff did not seek to set aside the Order in OS 643 of 2019 or even attempt an appeal. He waited 2 years and filed fresh proceedings.
  4. Finally, the proceeding is statue barred for having been filed 9 years after the cause of action against each defendant accrued.


Costs


  1. The award of costs is a discretionary matter and as such I must be satisfied that there is a proper basis.
  2. Costs is prescribed under Order 22 of the National Court Rules. In determining whether to award costs, I have considered the circumstances of the case. I consider here whether costs on an indemnity basis is warranted. In doing so, I adopt and apply Shepherd J’s decision in Opi v Telikom PNG Ltd (2020) N8290[13]. His Honour reviewed the authorities and summarized the principles governing costs on an indemnity basis as follows:

“(1) The purpose of a costs award on an indemnity basis, although compensatory is primarily punitive. As was stated by the Supreme Court in the Rex Paki case, an award of costs on an indemnity basis can be made where the conduct of a lawyer or a party to the proceedings is so improper, unreasonable or blameworthy that punishment is warranted.

(2) An award of costs on a solicitor/client basis is made to compensate the receiving party for the fees and disbursements that the lawyer charges the client, to the extent that those fees and disbursements, if taxed, were “reasonably” incurred. They do not include unreasonable or unusual fees and disbursements.

(3) Because a costs award on an indemnity basis is more generous than a costs award on a solicitor/client basis, its scope extends beyond that to which a receiving party is entitled had a solicitor/client cost been ordered. It is intended as a full indemnity for all costs and expenses incurred preparatory to and during the proceedings, not just the legal fees and associated disbursements charged by that party’s lawyer(s). So for example a receiving party, if an individual, is entitled to claim for loss of income or the value of time wasted when attending to matters relating to the proceedings. Similarly, a corporation or business can claim for the value of time spent by its officers and employees when attending to the proceedings.

(4) An award of costs on a solicitor/client basis is intended to compensate the receiving party for legal fees and disbursements charged by that party’s lawyer in having to unnecessarily defend proceedings which were an abuse of process, where there was no defence on the merits, where the other party failed to explore and exhaust all prospects of having the matter settled without the need for court action or delay, where there has been defiance by the other party in complying with court orders and or where the receiving party has generally had to incur unnecessary expense through unmeritorious litigation.

(5) Forewarning in writing or by electronic means should always be given that costs will be sought on a solicitor/client basis if proceedings are wrongly instituted and then dismissed as being without merit, or if the circumstances are sufficiently egregious to warrant not just the disapproval by the Court but also punishment, that costs will be sought on a full indemnity basis.”


  1. The position that costs should be awarded on an indemnity basis where the proceeding costs the defending party unnecessary expenses and at the same time the courts recourses are being wasted is affirmed in Paki v Motor Vehicle Insurance Ltd [2010] PGSC 2; SC1015 and adopted in State v Kalaut [2022] PGSC 45; SC2246, Angoman v Angoman [2019] PGSC 129; SC2074 and Hole v Mana [2016] PGSC 55; SC1536.
  2. Specifically, the Court in State v Kalaut in adopting Rimbunan Hijau (PNG) Ltd v Enei [2019] PGSC 73; SC1859 awarded costs on an indemnity basis where the appellants attempted to rehash arguments from the appeal in the slip rule motion. While both Supreme Court authorities concern slip rule applications, I consider the principles relevant in the given circumstances. The underlying consideration is the finality of a judgment and a party being entitled to the fruits of the judgement. Like unmeritorious slip applications, multiplicity of proceedings rehashing the same underlying subject matter result in the undesired consequence of unnecessary cost being incurred by a defending party and scares juridical time and resources being exhausted.
  3. The circumstances of this case demonstrate that costs should be award on an indemnity basis. The forewarning letter dated 3 April 2023 to Mr. Kop was extensive and canvassed all the matters presently before the Court. It informed the plaintiff to reconsider its position and discontinue the proceedings.
  4. The Plaintiff shall pay the 3rd Defendant cost on a full indemnity basis.


Orders


  1. The Orders of the Court are as follows:
    1. Pursuant to Order 12, Rule 37(b) of the National Court Rules, the 3rd Defendant’s Notice of Motion filed on 27 April 2023 is dismissed.
    2. Pursuant to Order 10, Rule 9A (15) (1) (b) (2)(d) and Order 8, Rule 27 of the National Court Rules, the proceeding is dismissed for failure to disclose a reasonable cause of action, abuse of process and being time barred.
    3. The Plaintiff shall pay the 3rd Defendant’s cost of the proceeding on a full indemnity basis, to be taxed, if not agreed.
    4. The 2nd Defendant shall bear his own costs.
    5. The time of entry of these orders is abridged to the time of settlement by the Registrar which shall take place forthwith.

Posman Kua Aisi Lawyers: Lawyer for the Third Defendant/Applicant
Toll Lawyers: Lawyer for the Plaintiff/Respondent


[1] at paragraph 37
[2] at paragraph 27
[3] Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45 at paragraph 18 adopting and applying Fullagar J. in Jackson v. Goldsmith [1950] HCA 22; (1950) 81 CLR 446, at p 466
[4] Refer to note 4
[5] Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45 per Gibbs C.J., Mason and Aickin JJ at paragraph 17.
[6] Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45 per Gibbs C.J., Mason and Aickin JJ at paragraph 22 applying Sir James Wigram V.C. in Henderson v. Henderson (1843) 3 Hare, at p 115 (67 ER, at p 319).
[7] At paragraphs 125-138
[8] [1981] HCA 45
[9] Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45 per Gibbs C.J., Mason and Aickin JJ at paragraph 36
[10] Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45 per Gibbs C.J., Mason and Aickin JJ at paragraph 38-42

[11] At paragraph 40
[12] ; [2005] HCA 12; (2006) 223 CLR 1 at [34]- [36]
[13] At paragraph 235

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