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Finance Corporation Ltd (trading as FinCorp) v Pacific Network Ltd [2024] PGNC 438; N11110 (9 December 2024)

N11110

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS NO. 97 OF 2020

FINANCE CORPORATION LIMITED trading as FINCORP
Plaintiff

V

PACIFIC NETWORK LIMITED
Defendant

Waigani: Kariko, J
2024: 11th November & 9th December

JUDGMENTS AND ORDERS – enforcement of summary judgment – writ of possession filed - subsequent order imposed condition or proviso for enforcement of writ of possession – application for writ of levy of property – whether abuse of process

Summary judgement was entered for the plaintiff in his claim for monies following default by the defendant in repayment of loans advanced by the plaintiff. A writ of possession subsequently issued but consent orders were issued that effectively prevented execution of the writ if payments were being made consistently to settle the judgement sum. The plaintiff then applied for leave for a writ of levy of property arguing the orders regarding the writ of possession were fraudulently obtained.

Held:

(1) An application to set aside consent orders must be formally applied for.

(2) As mortgagee, the plaintiff may exercise its rights pursuant to a writ of possession, and as judgement creditor, it may pursue enforcement by writ of levy of property.

(3) The application for leave is an abuse of process – the processes of the court have been improperly used in that the plaintiff has sought to bypass or overcome the condition or proviso stipulated in existing orders by pursuing the alternative remedy of writ of levy of property.

Cases Cited:
Michael Wilson v Clement Kuburam (2016) SC1489
Sai Business Grouping Inc. v Mainland Holdings Ltd (2010) N3853
Simon Mali v The State (2002) SC690

Counsel:
P Kepiniu, for the Plaintiff
M Kombri, for the Defendant

9th December 2024

1. KARIKO, J: Pursuant to a notice of motion filed 29 October 2024, the plaintiff seeks leave for the issue of a writ of levy of property of the defendant pursuant to O13 r18(1) of the National Court Rules.
   

BACKGROUND

2. These proceedings were filed by the plaintiff after the defendant defaulted in the repayment of loans advanced in respect to two properties owned by the defendant in Port Moresby (the Properties) that were mortgaged to the plaintiff as security for the loans.
   
3. On 2 March 2021, summary judgement was entered in favour of the plaintiff for K4,679,521.09 by Thompson J. It was further ordered that the plaintiff was to be given vacant possession of the Properties within 14 days failing which the plaintiff was granted leave to issue writ of possession of the Properties, to foreclose and sell them.
   
4. Vacant possession was not given as ordered and the plaintiff filed for writ of possession of the Properties on 2 June 2021.
   
5. The defendant then sought to set aside the orders of 2 March 2021 and the relevant motion was heard inter partes on 2 May 2022 by Linge AJ who ordered:
   
   • (1) Defendant’s Notice of Motion filed 8 March is withdrawn.
   • (2) Plaintiff to notify the Sheriff not to enforce the writ of summons since payments is coming in from the Defendant.
   • (3) The payment to be made by the defendant consistently failing which writs of possession can be enforced (sic).
     
6. After the writ of possession lapsed on 2 June 2022 without being enforced, another similar writ was filed 5 October 2022.
   
7. By this time, the in-house lawyer who had been acting for the plaintiff, Michael Wapi, left his employment and Posman Kua Aisi Lawyers took over carriage of the case for the plaintiff.
   
8. The lawyers made several approaches to the Sheriff to get his agreement that there was no legal impediment to the new writ of possession being enforced, but there was no definitive outcome.
   
9. On 8 August 2023 I heard an application by the plaintiff to set aside the orders of 2 May 2022 or in the alternative, have the orders of 2 March 2021 perfected. After a contested hearing, I dismissed those applications and suggested the plaintiff might consider applying to have orders of 2 May 2022 varied by correcting alleged errors and omissions in the orders.
   
10. The suggestion was taken up and the relevant application filed by the plaintiff on 15 August 2024.
    
11. However, the plaintiff filed the present notice of motion on 29 October 2024, which sought leave to withdraw the application filed 15 August 2024 and for the issue of a writ of levy of property.
    
12. The application for withdrawal was unopposed and therefore granted while the other application was opposed.
    

SUBMISSIONS

13. Counsel for the plaintiff presented two main contentions.
    
14. Mr Kepiniu argued that in-house counsel Michael Wapi consented to the orders of 2 May 2022 by Linge AJ without the instructions of senior management of the plaintiff company; that he was not authorized to consent to the orders, and they were therefore obtained fraudulently.
    
15. Mr Kepiniu also submitted that the orders of 2 March 2021 may be enforced by way of writ of levy of property, apart from a writ of possession. Reliance was placed on Sai Business Grouping Inc. v Mainland Holdings Ltd (2010) N3853 for the proposition that judgements or orders for the payment of money may be enforced by lawful measures including different writs - in this case, writ of possession and writ of levy of property.
    
16. Mr Kombri for the defendant submitted one major counter argument which was that the application by the plaintiff was an abuse of process; that the matters raised by the plaintiff were the same as those considered by this Court in dismissing the plaintiff’s previous application on 8 August 2024.
    

CONSIDERATION

17. The Supreme Court in Simon Mali v The State (2002) SC690 determined that the National Court has inherent powers under section 155 (4) of the Constitution to set aside a consent order for reasons of fraud, mistake or procedural irregularity.
    
18. The plaintiff has not formally applied to have the apparent consent orders of 2 May 2022 set aside for fraud, mistake or procedural irregularity nor have those grounds been properly established by evidence. Serious allegations were alleged against Michael Wapi suggesting he acted unprofessionally and fraudulently. I give no weight to those assertions as Mr Wapi was not before the Court to answer the claims and he was not given opportunity to defend the serious allegations of professional misconduct. The orders therefore still stand.
    
19. I accept that a plaintiff may pursue enforcement of a judgement or order by way of writ of possession or writ of levy of property. That is to say that a writ of levy of property may issue even though a writ of possession has been obtained.
    
20. However, in the present case, the execution of a writ of possession is prevented unless the defendant fails to consistently make payments towards settling the judgement sum. That is the effect of the orders of 2 May 2022 by Linge AJ. There is evidence of payments being made by the defendant to the plaintiff which seemingly persuaded the Sheriff not to enforce by writ of possession as directed by those orders.
    
21. A writ of possession is an enforcement method for judgements for possession of land (O13 r3) while writ of levy of property concerns judgements for payment of money (O13 r 2(a)).
    
22. As mortgagee, the plaintiff may exercise its rights over the Properties pursuant to a writ of possession. As judgement creditor, the plaintiff may also pursue enforcement by writ of levy of property.
    
23. In the present matter, the execution of either of the writs would result in the plaintiff securing the properties and having them sold to recover the judgement sum.
    
24. The orders of 2 May 2022 however make the enforcement by writ of possession conditional in that provided there are consistent payments to settle the judgement sum, execution of the writ is not permitted. These orders have not been set aside or varied by this Court nor have they been appealed against. In the circumstances, they remain valid and lawful orders of this Court.
    
25. The following apt remarks of Gavara-Nanu J in Michael Wilson v Clement Kuburam (2016) SC1489 at [25] are often cited in discussing the concept of abuse of process:
    

The types of abuses of process may vary from case to case but to establish an abuse of process there must be evidence showing that the processes of the court have been improperly used; or have been used for an improper purpose; or have been used in an improper way; or that such abuse of process have resulted in the right of the other party being denied, defeated or prejudiced....

(Emphasis added)

26. To my mind, the present application is an abuse of process – the processes of the court have been improperly used. The plaintiff has sought to bypass or overcome the condition or proviso stipulated in the orders of 2 May 2022, by pursuing the alternative remedy of writ of levy of property.
    
27. In these circumstances, it is not necessary to consider other submissions of counsel.
    
28. The application for leave for the issue of a writ of levy of property is refused. The plaintiff shall pay the defendant’s costs of and incidental to the application.

________________________________________________________________
Posman Kua Aisi Lawyers: Lawyers for the Plaintiff
Kombri & Associates Lawyers: Lawyers for the Defendant