SC751

PAPUA NEW GUINEA

[In the Supreme Court of Justice in Waigani]

SCR NO. 69 of 2002

REVIEW PURSUANT TO CONSTITUTION
SECTION 155 (2) (b)

BETWEEN:

Joseph Kupo,
Appointed representative of
188 former members of the
Papua New Guinea Defence Force
(Applicant)

AND:

Steven Raphael,
Secretary for the Department of
Defence Force
(First Respondent)

AND:

Brigadier General Peter Ilau,
Commander of the Papua New Guinea
Defence Force
(Second Respondent)

AND:

The Independent State of Papua New Guinea
(Third Respondent)

WAIGANI: Salika, J, Sawong & Gavara-Nanu, JJ
2003: 27th November
2004: 28th May

JUDGEMENTS AND ORDERS – By Consent – Application to set aside –
Consideration for review

ADMINISTRATIVE LAW – Judicial Review – Section 155 (2)(b) Constitution –

Setting aside consent order – Applicant does not have to satisfy the Court as to why he did not appeal when there is no right of appeal against a consent order –

Application need to satisfy court that there is cogent or convincing reasons or exception circumstance or there is matters in the interest of justice that the order should be reviewed or that there are clear legal ground meriting a review – Application refused.

FACTS

The applicants had obtained a judgment from the National Court ordering the State to pay them some money. After negotiations, their representative negotiated a settlement with the lawyers for the State. Subsequently he instructed their lawyers to draw up a consent order. This was clearly done and the National Court endorsed the consent orders. Pursuant to that order, the applicants were paid and received the sum agreed. After receiving the money, they did not challenge the consent order or sued this lawyer for professional negligence for acting without instructions. Some nine (9) years later they filed a s.155(2)(b) application to review the consent order.

HELD

1.	In an application to set aside a consent order, the applicant need not satisfy the court as to why he did not appeal, as there is no right of appeal against a consent order.

2.	The applicant must show to the court that there are cogent or convincing reasons or exceptional circumstances, or there are matters are in the interest of justice or that there are clear legal grounds meriting a review.

3.	Where there is or are allegations of negligence of a lawyer, the applicant should pursue a claim against the lawyer for professional negligence and not invoke the Courts inherent review jurisdiction under s.155(2)(b) of the Constitution.

PAPUA NEW GUINEA CASES CITED:
Avia Aihi v The State [1981] PNGLR 81
Avia Aihi v The State (No 2) [1982] PNGLR 44
Danny Sunu v The State [1984] PNGLR 305
The State v Colbert [1988] PNGLR 138
Griffin v Westpac Bank (PNG) Ltd [1993] PNGLR 353

Counsel:
L.R. Henao with S.D. Uyassi, for Applicants
R. Meten, for Respondents

28th May, 2004

BY THE COURT: This is an application by the applicants for judicial review pursuant to s.155(2)(b) of the Constitution seeking to invoke this court’s inherent discretionary jurisdiction to review a decision of the National Court.

The summary of the facts and circumstances giving rise to this application are as follows. The applicants’ brought proceedings on behalf of themselves and other retrenched members of the Papua New Guinea Defence Force. They commenced proceedings in the National Court in April 1989 by way of an Originating Summons (OS No. 58 of 1999) seeking entitlements following their retrenchment from the Defence Force.

On the 26th November 1990, the National Court gave judgment in favour of the applicants. Sometime after that judgment was given, discussions were held to identify who should benefit from the judgment. 
As a consequence, on 11th of August, 1993, by decision number 129/93, the National Executive Council resolved inter alia to:

1.	Note the requirement to conduct the audit and approve the audited list of 188 claimants.

2.	Authorize retrenchment payments to be made to the 188 claimants.

3.	Authorize the Department of Finance and Planning to make some payments in 1993 if funds are available and the balance in 1994. 

The Departments of Defence Force and Personnel Management undertook a complete audit of the list of ex-servicemen and their entitlements. The audit identified 188 ex-servicemen, who should benefit from the National Court judgment of 26th November, 1990.

Thereafter, on the 3rd December, 1993 two different orders were entered pursuant to the judgment of 1990. The court records show that consent orders were made by Sheehan, J. (See exhibit ‘L’ of Loani Henao’s affidavit sworn 30th September, 2003 and filed 14th October, 2003). The terms of that order read:

"Judgement by consent for plaintiffs in the sum set out in the draft order and initialled by the Court"

The consent order was for two million, five hundred thousand kina (K2,500,000.00) in full and final settlement. Following the consent order the sum of K2.5 million was paid and received by the applicants. It is this consent order the applicants now seek to review on the basis that they gave no instructions to their then lawyers to consent.

After receiving the K2.5 million the applicants did not challenge the conduct of their previous lawyers or indeed the consent order at all.

By letter dated 5th of December, 1994, the then Secretary for the Prime Minister’s Department, Mr Brown Bai wrote to the Secretary for Finance, Mr. G. Aopi acknowledging the amount of K6,370,776.19 was due to the 188 ex-servicemen and sated that if this amount was not settled by the end of 1994 an additional amount K764,493.33 being loss of twelve per cent (12%) from the devaluation of the kina would become payable. Mr Brown Bai further stated that the Prime Minister was fully aware of the matter and supported the immediate settlement. On 2nd June, 1995 a letter from Lt. Col. J. Lytus of the Defence Force was sent to the Acting Secretary for the Department of Prime Minister, Mr Painap to implement the National Executive Council decision no. 149/83 to pay the ex-servicemen.

On two occasions in 1997 Carter Newell Lawyers acting for the applicants wrote to the Solicitor General’s office providing a list of the 188 ex-servicemen and asking that the State pay the outstanding amount. They again wrote in 1998 asking that the State pay the outstanding balance. It is to be noted that even at this stage the applicants did not instruct Carter Newell lawyers to challenge the consent orders.

On 12th November, 1997, Carter Newell lawyers wrote to the Secretary for the Department of Prime Minister and the National Executive Council pointing out that the State owed the 188 ex-servicemen a balance of K7,468,012.28 after being paid K2.5 million. They requested that discussions on the matter be made before the end of the year.

On 13th October, 1998, Carter Newell lawyers wrote to the Secretary for Defence following up on the outstanding balance.

On 4th September, 1998, the applicants wrote to Carter Newell lawyers and complained that Kemaken Lawyers had consented to compromise the claim for K2.5 million without their knowledge or instructions. They requested Carter Newell lawyers to take out court proceedings to nullify the Consent Order.

On 15th May, 1999, John Imele Aeb wrote on behalf of his fellow ex-servicemen withdrawing instructions from Carter Newell lawyers.

In October 2000, the applicants engaged the services of S.D. Uyassi & Co. Lawyers to contest the Consent Order.

On the 6th of October, 2000 the firm of S.D. Uyassi & Co. filed proceedings by way of a Writ of Summons (WS No. 1336 of 2000). This proceeding was struck out by the court as not being appropriate for such a cause of action. Thereafter nothing happened until the 29th August, 2002, when an Originating Summons (OS No. 543 of 2000) was filed. Again the National Court struck it out as it was again not the appropriate procedure to challenge the Consent Order. The court then advised counsel to commence proceedings by way of a Judicial Review. The present proceeding was commenced on the 13th November, 2002. Thus a period of over nine and a half years lapsed before the present application was filed.

The Constitution, section 155(2)(b) reads:

"The Supreme Court …..

(b)	has an inherent power to review all judicial acts of the National Court."

Section 14(2) of the Supreme Court Act provides provisions for Civil appeals to the Supreme Court. In particular s.14(5) reads:

"(5) An appeal does not lie from an order of the National Court made by consent of the parties….."

The principles of law governing a s.155(2)(b) review application are now settled. This jurisdiction was developed in the seminal case of Avia Aihi vs The State [1981] PNGLR 81 and Avia Aihi vs The State (2) [1981] PNGLR 44. This case established that s.155(2)(b) empowered the Supreme Court with "unfettered discretionary jurisdiction" to review all judicial acts of the National Court even though the applicant had lost all statutory right to appeal or to apply for leave to appeal. It was further held that "the discretion should be exercised only in exceptional circumstances where some substantial injustice is manifest, or the case if of some special gravity, the onus being on the applicant".

Those principles were followed and applied in Danny Sunu vs The State [1984] PNGLR 305. This was a criminal case. However, we find the re-statement of these principles by Pratt and McDermott JJ at 307 to be useful:

"It is clear from the format of our appeal legislation with its hierarchy of courts, from the wording of the Constitution, and especially from the judgment of their Honours in the Avia Aihi cases that any applicant for a review under s.155(2)(b) must first and foremost convince the court, despite a failure to exercise a right to appeal against the decision which is disputed, that it should exercise its inherent and discretionary power in favour of the application. It is equally clear that such power will be exercised only in ‘exceptional circumstances where some substantial injustice is manifest, or the case is of special gravity’ (per Kearney Dep CJ in Avia Aihi vs The State [1981] PNGLR 81 at 93) or that there are ‘cogent and convincing reasons and exceptional circumstances’ (per Kidu CJ and Andrew, J in Avia Aihi (No. 2) at 46 adopting what the pre-Independence Full Court said in The Secretary of Law vs Tisunkac Nawok Domstock [1974] PNGLR 246 at 248. In determining whether or not there are ‘cogent and convincing reasons’ we agree with the approach of Kapi, J in the Avia Aihi (No. 2) at 61, that the merits of the application, or perhaps rather more specifically, the merits of the case to be argued must form part of the ‘cogent and convincing reasons’. After all if the matter, the subject of the application has not merit whatsoever, it is impossible to see how there could be any cogent or convincing reasons for granting a review. Therefore, the first thing to be decided by this Court, is whether the applicants have made out sufficient reasons and exceptional circumstances for the court to grant a hearing….."

In relation to the fault of lawyers the Supreme Court held that the negligence of a lawyer is not in itself a convincing reason for the court to exercise discretion to grant a review. Pratt and McDermott JJ at 308 said:

"In civil proceedings of course, it may well be possible to sue a lawyer for damages occurred by incorrect advice and is successful to receive as damages an amount equivalent to that which the party would have obtained if the original proceedings had succeeded. However, that is not the position in a criminal case, especially when a minimum penalty sentence is involved. Mandatory compensation is small solace in such circumstances. Consequently, had this court been concerned with advice given in civil proceedings, there might well be no justification whatsoever when granting a review as another remedy is available to the party wronged."

His Honour Woods, J, at p. 312 said:

"A mistake by a legal adviser is in itself not a convincing reason for a court to exercise discretion. In civil proceedings, applicants would have a remedy in damages against the legal adviser."

In the Independent State of Papua New Guinea vs Colbert in [1988] PNGLR 138, the Supreme Court applied these principles to a civil case involving the conduct of a lawyer. The short facts were that the respondent sued the State for damages for negligence. He was successful in the National Court and was awarded damages. The State did not appeal against that decision within time. Much of the delay was due to the negligence of the lawyer acting for the State in filing an appeal within time or seeking an extension to appeal. Subsequently the State filed a s.155(2)(b) application to the Supreme Court to review the decision of the National Court. The Supreme Court (Kapi DCJ and Bredmeyer, J) refused the application. In dealing with negligent conduct of lawyers, Kapi, DCJ (as he then was) said at 143:

"When dealing with the fault of lawyers, the Supreme Court made a distinction between civil and criminal cases. In Danny Sunu vs The State at 308, Pratt and McDermott JJ said:

…Consequently, had this Court been concerned with advice given in civil proceedings, there might well be no justification whatsoever for granting a review as another remedy is available to the party wronged." (emphasis added)

At 312 Woods, J said:

"On the first step, the facts are quite clear. The applicants failed to appeal. This failure was an admitted mistake by the applicant’s legal advisers on the effects of the reference from the National Court. A mistake by a legal adviser is not in itself a convincing reason for a court to exercise discretion. In civil proceedings, the applicants would have a remedy in damages against the legal adviser. However, in the case before us, we are dealing with the liberty of the applicants and no action for damages against the legal advisers can compensate for deprivation of liberty." (emphasis added)[sic]

I agree entirely with the views expressed by the Supreme Court in the judgments referred to. It is for the appellant to bring his application within "exceptional circumstances" for the court to exercise its discretion to review…."

In the same case Bredmeyer, J, after setting out the factual background to the delay in filing of the Notice of Appeal and other factors said this regarding the conduct of the lawyers at p.147:

"This is the first section 155(2) Application, so far as I know, in a civil case and different considerations should apply. Here we have a client, in this case, the State, who is not ignorant or, no uneducated, not unrepresented, not penniless and not in custody away from phones, typist and the like. It can instruct the lawyer of its choice, he can prompt or prod it’s lawyers to act promptly. It too can sue its lawyers for damages for professional negligence. It is true that the principle of law decided by Corry, J is important, and award of damages was large – and they affect us which support the application – but in my view they are heavily outweighed by the cause of delay. As I have said, I find nothing except circumstances in the cause of the delay. Negligence or incompetence by a lawyer should never be a basis for a s.155 application in a civil case. I can conceive of some instances where a default by a lawyer, for other reasons, in a civil case could amount to exceptional circumstances. For example, a lawyer in a one man firm instructed to appeal, may be run over by a bus before he lodges the appeal. The lawyer’s failure in that case is not caused by incompetence but by an event outside his control. I do not believe that s.155(2) of the Constitution was designed to protect civil lawyers from suits for professional negligence……" (emphasis added)

In the present case the decision sought to be reviewed is a Consent Order. Under s.14(2) of the Supreme Court Act, there is no right of appeal. In accordance with the principles set out above, the applicants need not satisfy the Court why they did not appeal within time.

Are there cogent or convincing reasons or exceptional circumstances or are there any matters in the interest of justice that the orders made should be reviewed? The point raised by the applicant is a simple one. The applicants submit that their lawyer who consented to the order had no instructions at all from the applicants. The Supreme Court in Griffin vs Westpac Bank (PNG) Limited [1993] PNGLR 353 considered this issue. The brief facts (from headnotes) were that the respondent or mortgagee claimed possession of a mortgage property and took out a summons for a possession order. The lawyers for the mortgagee consented to the order. The mortgagee sought judicial review of the order under S. 155(2)(b) of the Constitution on the ground that the lawyers acted on his behalf without his instructions. The evidence called before the Court showed that the lawyer had no instruction to consent to the order for possession. Consequently the Court upheld the review and set aside the consent order, on the basis that the lawyer had no authority to consent to the order. The court there held that it was not just to allow the Consent Order to stand where the lawyer purported to act on behalf of the litigant had no instructions to act in the matter. The court at p.354 said:

"Are there cogent or convincing reasons or exceptional circumstances or any matter in the interest of justice. The point raised by the applicant is a simple one the lawyer who appeared and consented to the order had no instructions at all from the applicants. This is a very serious allegation. A lawyer on record can bind his client unless his authority is limited and the client communicates delimit to him. Where a client acts in such a way that leads his lawyer to believe has this authority, the lawyer can bind client, see Waugh vs. H.B. Clifford & Sons Limited [1982] 1 All ER 1095. In such a case, an opposing litigant is not required to prove that the lawyer has authority from his client. But the authority to bind the client is limited to the terms which do not involve extraneous matters. See Halsbury’s Laws of England 4th Edition Volume 44 paragraph 166. Some of the clear examples of non extraneous matters are interlocutory proceedings to facilitate speedy resolution of the substantive issues and, hence, finality may be reached."

The Court then noted some important facts, which showed that on 25 September, 1992 the lawyer for the mortgagee indicated the necessity to obtain instructions. When the matter resumed on 5 October 1992, another lawyer, but from the same firm appeared for the mortgager where he consented to the order for possession. The applicant had strongly denied giving instructions to his lawyers to consent at all. After noting some further facts the Court at p. 354 said: 

"It is clear law that any lawyer admitted to practice law cannot act in a matter unless he has instructions to act in the matter. We need not refer to any authority to support this proposition. It is simply not just to allow a Consent Order to stand in these circumstances. If this is not corrected, lawyers could not do things on behalf of people who do not give any instructions. To leave the matter in the circumstances of this case would be unjust to the applicant."

In the present case, are there cogent or convincing reasons or exceptional circumstances or any matter in the interest of justice or clear legal grounds meriting a review of the consent order.

The argument that has been put forward by the applicants was that the applicants had not instructed their lawyers to consent to compromise and receive a lesser amount than the amount they had claimed. In other words they say that they had not instructed their lawyers to compromise the claim or consent to accept a lesser amount. Is there any evidence which supports the allegations against their previous lawyer? The evidence from all the other applicants is that they did not give their consent to their then lawyer to consent. However, there are other evidence which to our mind gives a different version on this issue.

For instance, there is the evidence from their previous lawyer annexed to Mr Henao’s affidavit (see Annexure "E"). This is a letter from Mr Sam Kemaken, the previous lawyer who consented to the compromise of the claim. In his letter, Mr Kemaken says:

"Incidentally, as we recall most, if not all, of these who got their claims were paid on the basis of rejected claims. This was revealed by the State to our Mr Kemaken in the presence of Mr Joseph Kupo and other representatives of the ex-servicemen in a meeting at the Sir Buri Kidu conference room. As to the Consent Order of 3rd December 2002, we wish to point out that the same was negotiated between the State and Mr Kupo and other representatives of the claimants and the Attorney General (on behalf of the State). Kemaken lawyers was simply engaged to formalise the Consent Orders. The terms of such consent and the authority for same would be on the relevant file. In any event, Mr Kupo who was privy to the negotiations leading to the Consent Orders ought to be in a position to instruct you on this matters." (emphasis added)

We have highlighted these sentences because to our mind, Mr Kemaken says that Mr Kupo, one of the principle applicants, who sues in a representative capacity was aware of what was happening and he gave the necessary instructions. This piece of evidence is from the applicants. In our view this evidence puts a different version to the applicants claim that they did not authorise Mr Kemaken to compromise their claim. Mr Kemaken says that the Principal plaintiff Mr Kupo was directly involved in the negotiations that led to the consent orders. This piece of evidence shows clearly that the applicants through their representative Mr Kupo did gave the necessary instructions to their previous lawyers to consent to the settlement. There is, in our opinion, no reason not to accept the evidence from Mr Kemaken.

Further there are other disturbing features of this case which go to the issue of whether there are cogent or convincing reasons or exceptional circumstances. First the judgment referred to the plaintiffs’ names in exhibit "G". This exhibit is not in the review book that is before us. For our part we do not know what information was in that particular exhibit, for example whose names were on it, or what figures or sums were on it. 

Thirdly, a closer examination of the two orders dated 3rd December, 1993, also show disturbing signs. The Consent Order (review book pp. 33-38) had a schedule attached to it. The schedule listed the names of the applicants and one column setting out the amounts of money each was to receive. The seal of the National Court was affixed to each of the pages of the said order and the schedule. The cover page had the name of the law firm of Kemaken Lawyers. However, the other order of 3rd December did not have a cover page with the name of the law firm. The seal of the National Court was stamped only on the Order itself. The pages of the schedule to that order were not sealed. The schedule not only had the names of the applicants, but it also contained three columns of figures, namely "maximum entitlement", "amount paid/1993" and "amount due." That schedule had hand writings over the figures. It is obvious to us that this was a belated attempt to mislead this Court of what had been compromised.

We have set out these disturbing features to demonstrate that we do not accept the arguments put forward by the applicants. In our view what we have set out above shows clearly that they have not shown that there are convincing or cogent reasons to grant a review.

Further, the evidence we have set out above shows that the allegations they have made against their former lawyer might not be sustained. Even if the allegations are true, then they had recourse to sue their previous lawyers for professional negligence. In our view a party should not seek this court’s review jurisdiction where there are other remedies available. A lawyer’s professional negligence should not be used to invoke s.152(2) of the Constitution.

As was said by the Supreme Court in Colbert (Supra) at:

"A mistake by a legal advisor is not in itself a convincing reason for a court to exercise discretion. In civil proceedings, the applicant would have a remedy in damages against the legal adviser. See Danny Sunu".

Another factor that has convinced us not to grant the application is the delay in bringing this application. The Consent Orders were made on 3rd December, 1993. No action was taken to challenge that order. However, soon after the orders were made the applicant’s were paid their monies due and payable pursuant to that order. They benefited from that order. It is obvious that after receiving the money they pursued various government agencies for what they claimed was further monies due to them.

Furthermore, they had accepted the compromise and they received the payments in or about 1993. If in fact they had not given instructions to comprise the claim as they now alleged, then why did it take so long for them to apply to set aside the Consent Order. There has been an undue delay in making the application to set aside the Consent Order. This is evident from their own evidence. They are not ignorant or uneducated nor are they unaware of seeking redress against their previous lawyer. For instance, after the Consent Orders were made in December 1993, they did nothing to have those Consent Orders set aside. From 1994, 1995, 1996 and 1997, they did not apply to the National Court to set aside the consent orders as being without instructions. It was in May 1997 that they sought the assistance of Carter Newell Lawyers who it appears were not even instructed to challenge the Consent Orders. In fact as Mr Henao submitted during his submissions they were instructed to collect the balance of the outstanding amount. It was only in September 1998 that the applicants wrote to Carter Newell complaining that their previous lawyers had consented to comprise their claim for K2.5 million without their knowledge. Very little was done even at that stage to challenge the Consent Order. Then in 2000 a Writ of Summons was filed which we have referred to and which was struck out by the court as being incompetent. Subsequently, an Originating Summons was filed in 2002 and this was also struck down by the National Court as being incompetent. There has been an undue and unreasonable delay on the part of the applicants.

In our respectful view, these circumstances demonstrate quite clearly that the applicants had simply not done anything to review the Consent Orders. We are of the view that the delay does not of itself amount to cogent reasons or exceptional circumstances.

The next factor to consider is whether there is "any matter in the interest of justice" that the order made should be reviewed.

As we have tried to demonstrate in the earlier parts of this judgment, and for the same reasons we have given, we are not convinced that there is grave reason to apprehend that justice has actually been miscarried.

Furthermore, for the reasons we have set out above, we are also of the opinion that there are no clear legal grounds meriting a review of the order. The applicants have failed to satisfy this Court that it should exercise it’s discretion to review the decision in question. Consequently and for the reasons we have given we would refuse the application.

In the circumstances of this case, we would order that each party pay their own costs.

Lawyers for the Applicants		:	Henaos Lawyers
Lawyers for the Respondent		:	Narakobi Lawyers