SC1045

PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]

SCA No. 131 of 2007

Between:

STEPHEN JOHN ROSE & JOHN CHARLES HARRISON
Appellants

And:

THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Respondent

Waigani: Injia, CJ
2009: 3rd August

COSTS – application for security for costs – grant or refusal of an order for security for costs in an appeal is discretionary - Judge may order security to be given for cost in ‘special circumstances’ - interest of justice favours the appellants’ right to pursue judgment – application for security for costs dismissed – s.18 (1) Supreme Court Act

Cases Cited:

Brinks Pty Ltd & 2 others v Brinks Incorporated [1996] PNGLR 75,
Lambu v Ipatas (No. 3) [1997] PNGLR 2007

Counsel:

S Rose, (appellant) in person
G Gileng, for the Respondent

3rd August, 2009 

1. INJIA CJ: This is the respondent’s application for security for costs. It is made under s.18 (1) of the Supreme Court Act. The application is supported by the affidavits of Mr Devette, Mr Inasi and Mr Kinn all sworn and filed herein. The application is contested by the appellant Mr Rose. Mr Rose relies on his affidavit sworn and filed on 17th July 2009.

2. The other appellant Mr Harrison though served with the application made no appearance at the hearing.

3. Both parties made submissions last week and I reserved my ruling to today which I now deliver. 

4. The grant or refusal of an order for security for costs in an appeal is discretionary. The ambit of the exercise of this discretion is circumscribed by s 18 (1) itself which says the "Judge may, in special circumstances, order that just security be given for the cost of an appeal". I am referred to a number of National Court and Supreme Court decisions in which "special circumstances" have been considered. It is sufficient to refer to the authoritative statement of the principles in two Supreme Court decisions cited by the parties. 

5. In Brinks Pty Ltd & 2 others v Brinks Incorporated [1996] PNGLR 75, the Supreme Court defined special circumstances as follows:

"The key word we need to interpret is "special circumstances". It is not possible to give an exhaustive meaning of what the "special circumstances" are. It is, however, possible to indicate the nature of these circumstances in the context of s 18. It can be implied from the context of this provision that security for costs of an appeal is not necessary in every case. The Court may exercise the discretion to order security for costs only in "special circumstances"...... 

Having regard to the National Court Rules and the need to protect the interest of the respondent’s costs, we would adopt the circumstances set out in the National Court Rules as coming within the meaning of "special circumstances" upon which the Court may exercise its discretion to order security for costs of an appeal, namely:

(a) that an appellant is ordinarily resident outside Papua New Guinea;

(b) that there is reason to believe that the appellant will be unable to pay the costs of the respondent if ordered to do so;

(c) that the address of the appellant is not known;

(d) that the appellant has changed address after the appeal is instituted with a view to avoiding the consequences of the appeal.

As we have stated before, this list is not exhaustive. There may be other circumstances which may come within the words "special circumstances".

6. In Lambu v Ipatas (No. 3) [1997] PNGLR 2007, the Supreme Court discussed some earlier cases in which security for costs was dealt with including Brinks case and stated the ultimate test to be "whether, it is in the interest of justice to make or not to make an order for security for costs having regard to all the circumstances of the case (adopting the words of s 155 (4) of the Constitution)". 

7. In this application the respondent relies on the circumstances in (a), (b) and (c) in the Brinks case. It is submitted for the applicant that the appellants are Australian citizens and are not currently resident in PNG and that their fixed residential or business address for service contained in the court documents filed by appellants which is in Port Moresby, is unreliable because the respondents have had much difficulty in serving court documents on the location specified in that address for service. It is further submitted that there are no known assets of the appellants in PNG to satisfy any judgment on costs in the event of an unsuccessful appeal.

8. Mr Rose conceded he is a non-citizen and not ordinarily resident in PNG. He submits he has provided a fixed address for service of documents and documents have been served on that address and received by him in the past. Mr Rose submits whilst the appellants do not have fixed assets in PNG, they have a judgment to their credit in substantial amount which they are pursuing in various proceedings in the National Court and in this appeal. The judgment is not likely to be disturbed on appeal because the State’s denial of the validity of the Certificate of judgment is unfounded and the trial judge who questioned and varied the earlier default judgment for specific amount and substituted it for judgment on liability for damages to be assessed after certificate of judgment was issued, lacked jurisdiction to do so. The earlier judgment is res judicata and it was not open to that judge to revisit it and vary it. 

9. Whilst I am satisfied that the applicant has met criteria (a), I am not satisfied that criteria under (b) and (c) have been satisfied. The appellants have consistently maintained the same address for service and they have attended court proceedings both before this Court and the National Court. The fact that Mr Rose has received the present application and filed affidavit and submissions and argued his case before me removes any doubt about service of documents on that fixed address for service. In any event the judgment they are seeking to enforce is in the millions and no judgment creditor with that kind of money owing would be foolish to abandon the Court battle to enforce the judgment midstream in fear of loosing out the enforcement proceedings and being penalized with hefty costs.

10. I accept Mr Rose’s submission that what is important is the judgment standing to their credit and the perceived strength of the case which both parties are engaged in litigation than the issue of costs. I am satisfied that the appellants do have an arguable case that they will actively pursue to its final conclusion at all costs wherever they may be physically situated, both within and outside this country. It is in the interest of justice that the appellants’ right to pursue the judgment should not be hampered by order for security of costs. 

11. For these reasons, I dismiss the application with costs.

________________________________________________

Appellant in person
Posman Kua & Aisi Lawyers: Lawyer for the Respondent