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Niutech Building & Civil Contractors Ltd v Wood Star Builders Ltd [2024] PGNC 28; N10676 (8 March 2024)

N10676

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

WS NO. 1360 OF 2017

NIUTECH BUILDING & CIVIL CONTRACTORS LIMITED
Plaintiff

V

WOOD STAR BUILDERS LIMITED
Defendant

Waigani: Carey J
2023: 16^th November & 1^st December
2024: 8^th March

CONTRACT – Whether an oral agreement exists – Breach of contract – Relief sought.

The Plaintiff sued the defendant for breach of contract. The Plaintiff asserts that there was an oral agreement and failure of the Defendant to honour that agreement gives rise to the claim. In this regard, the plaintiff sought damages.

Held:

1. The Plaintiff did not prove that there was an oral agreement between the Defendant and itself.
2. The Plaintiff did not prove fraud.
3. This proceeding is dismissed and claims for relief by the Plaintiff are refused.
4. The Plaintiff shall pay the defendant’s costs of and incidental to this proceeding, to be taxed if not agreed.
   

Cases Cited

Anton Ganbu v Edward Kurame [2017] N5499
Bebnadette Watir v Mathias Semmy [2019] N7681
Wama v Manihia [2014] PGNC 5; N5499

Counsel:

S. Javati, for the Plaintiff
M. Paiya, for the Defendant

JUDGMENT

8^th March 2024

1. CAREY J: The Plaintiff claims that the Defendant is in breach of an oral agreement for a construction project (Mira Project) for which the Plaintiff was engaged by the Defendant to execute.
   
2. The Plaintiff claims to have completed the project which was a service station and food store at 9 Mile, National Capital District in Port Moresby.
   
3. The defendant indicates that there was no oral agreement between the Plaintiff and Defendant to sub-contract the Mira Project to the Plaintiff at 9 Mile, Port Moresby.
   
4. Both Plaintiff and Defendant relied on affidavits which were tendered to the Court as evidence.
   
5. The Plaintiff initiated this proceeding to make a claim against the Defendant based on the assertion by the Plaintiff that there was a breach of contract, with claim for damages and losses arising from the breach of contract.
   

6. The Plaintiff further alleges fraud against the defendant.

7. The Defendant suggests that there was no Oral agreement between the parties.

8. The Defendant also indicates that there was no sub-contract given to the Plaintiff and that all persons claiming to be officers and employees of the Plaintiff company were employees of the Defendant company.

9. The Defendant relied on the following evidence and submitted into Court as outlined below:

10. The Plaintiff relied on the following evidence and submitted into Court as outlined below:

(1) WHETHER AN ORAL AGREEMENT EXISTS?

11. The elements of a contract are: offer, acceptance, consideration and intention to create legal relations.

12. The Plaintiffs’ submission are that the amended Statement of Claim filed on 20 December 2017 establishes the elements of an oral contract.

13. The Plaintiff asserts that the decision of 20 December 2020 by Anis J to not dismiss the proceedings indicates that the learned judge was of the view that the Plaintiff’s claim had merit and the decision confirmed that the establishment of the elements of an oral contract is endorsed.

14. I find that the Plaintiff’s argument in this regard to be defective as the ruling by the judge referred to in paragraph 13 simply confirms that it is for a trial to make such a determination.

15. By deductive reasoning, in examining the submissions by the Plaintiff the elements of a contract as established in Anton Gambu v Edward Kurame (2017) N6868 and consideration per the case of Benadette Watir v Mathias Semy (2019) N7681 were not supported.

16. The Plaintiff’s argument that there was an oral agreement does not align with the evidence as submitted in the affidavit of Lecksen Wantaki filed on 20 July 2022 and referred to as D2 in which contradicts the assertion of an oral contract including being engaged as sub-contractors.

17. The Defendant provides evidence as indicated in D2 in paragraph 16 of cheque payments made to among others including Wani Timbun, Wayne Wapung and Daianah Gordon which further supports the proposition of those individuals being employees of the Defendant.

18. The Plaintiff’s argument that there was an oral agreement therefore fails and is rejected based on the evidence submitted to the Court.

19. Moreover, the specific performance that could be relied on as evidence that there may have been a contract merely buttresses the defendant’s contention that the relationship between the parties formed part of an employer and employee relationship. The Court finds that the payment to individuals on a continuous basis were wages.

(2) WHETHER THERE WAS A BREACH OF CONTRACT?

20. As indicated in paragraph 18 the court accepts that there was no contract between the parties and therefore there is no breach of contract claim that can succeed.

21. The evidence of an oral agreement must be detailed as stated in Wama v Manihia [2014] PGNC 5; N5499.

(3) WAS THERE FRAUD?

22. The Plaintiff provides a submission on Fraudulent Misrepresentations.

23. The Fraudulent Misrepresentations asserted by the Plaintiff relate to the contractual obligations of the Defendant and Mira Limited.

24. Mira Limited is not a party to these proceedings.

25. In Equity there are general principles which determine how the rules of equity function and apply.

26. There is one maxim which is instructive in this matter. It is that he who comes into equity must come with clean hands.

27. The Plaintiff asserts the Defendant perpetrated fraud on Mira Limited. If the Court accepts this submission as factual then it also suggests that the plaintiff colluded with the Defendant to do such fraud and in so doing now seeks to benefit from such fraud through the breach of contract claim it now argues against the defendant.

28. If the Court were to accept that there was an oral agreement between the Plaintiff and Defendant and a breach of this agreement then by the Plaintiff’s action there can be no remedy sought by the Courts to perpetuate a fraud it would have committed against Mira Limited. The maxim he who comes to equity must come with clean hands would apply.

29. However, the Court has determined that there was no breach of contract as there was no oral agreement and the evidence submitted by the Plaintiff does not sufficiently demonstrate such agreement. Further, the evidence by the Defendant demonstrates there was no oral agreement.

30. The Plaintiff has not proven fraud and it is rejected in its entirety based on the evidence submitted.

ORDER

31. It is ordered that:

1. The Plaintiff did not prove that there was an oral agreement between the Defendant and itself.
   
2. The Plaintiff did not prove fraud.
   
3. This proceeding is dismissed and claims for relief by the Plaintiff are refused.
   
4. The Plaintiff shall pay the Defendant’s costs of and incidental to this proceeding, to be taxed if not agreed.

________________________________________________________________
Javati Lawyers: Lawyers for the Plaintiff
Paiya Lawyers: Lawyers for the Defendant