SC2315

PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]

SCA NO. 18 OF 2021

BETWEEN:
GERANG NEARLY, Senior Field Supervisor, Stettin Bay Lumber Co. Limited
-First Appellant-

AND:
MICHAEL NAWAN, Field Supervisor, Stettin Bay Lumber Co. Limited
-Second Appellant-

AND:
IGAT AKUM, Field Supervisor, Stettin Bay Lumber Co. Limited
-Third Appellant-

AND:
JOE LASO, Supervisor Planning and Monitoring, Stettin Bay Lumber Co. Limited
-Fourth Appellant-

AND:
TAI KUMBI, Field Officer Planning and Monitoring, Stettin Bay Lumber Co. Limited
-Fifth Appellant-

AND:
JIMMY KASAO, Field Officer Planning and Monitoring, Stettin Bay Lumber Co. Limited
-Sixth Appellant-

AND:
BENJAMIN ANANIAS, Driver of Planning and Monitoring, Stettin Bay Lumber Co. Limited
-Seventh Appellant-

AND:
JOHN WAKORE, Security Manager, Stettin Bay Lumber Co. Limited
-Eighth Appellant-

AND:
PAUL KORONG, Security Guards, Stettin Bay Lumber Co. Limited
-Nineth Appellant-

AND:
MATHEW GABRIEL, Security Guards, Stettin Bay Lumber Co. Limited
-Tenth Appellant-

AND:
PETER YUI, General Manager, Stettin Bay Lumber Co. Limited
-Eleventh Appellant-

AND:
STETTIN BAY LUMBER CO. LIMITED
-Twelfth Appellant-

AND:
MIKE EKI for and on behalf of himself, his family and twenty-three (23) others with their respective families, whose names appear in the schedule attached
-Respondent-

Waigani: David, Berrigan & Dowa JJ
2022:  21st and 25th November

PRACTICE AND PROCEDURE – Supreme Court – Dismissal for want of prosecution – Relevant Principles – Reasonable explanation for the delay-Application dismissed. 

The Respondents sought dismissal of the proceedings for want of prosecution under Order 7 Rule 48(a) of the Supreme Court Rules. It has been about 19 months since the appeal was lodged. The Respondent alleged that the Appellants have failed to prosecute the appeal with due diligence. 

Held:  

1)	The Courts power to dismiss under Order 7 Rule 48 of the Supreme Court Rules is discretionary. (Kimisopa v Paraka (2009) SC 1325 and Tulapi v Alu (2001) SC1177).  

2)	The power to dismiss for want of prosecution should only be exercised when the Plaintiff’s default had been intentional and contumelious or where there has been an inordinate and inexcusable delay on his or his lawyer’s part in the prosecution of the case. (Nicholas-v-Commonwealth New Guinea Timbers Ltd [1986] PNGLR 133)

3)	 If an appellant has delayed in prosecuting his appeal, the appeal should be dismissed unless there are reasonable explanations for the delay (Kalinoe-v-Paraka (2007) SC874, Magellan Properties Ltd v Steamships Trading Company Ltd (2016) SC1518).

4)	The absence of an explanation is fatal to a Respondent for dismissal where an explanation can quite properly be expected (PNG Nambawan Trophy Limited-v-Dynasty Holdings Ltd (2005) SC811).

5)	Where delay of prosecution is alleged, the applicant must establish by evidence a case for the Court to exercise its power in its favour before the burden shifts to the Appellant to provide an explanation for the delay and demonstrate its readiness to prosecute the appeal. (Tulapi-v-Alu (2011) SC 1177).

6)	Although there was a delay, the appellants provided a reasonable explanation, and the delay was not intentional or contumelious. The Court in the exercise of discretion refused the application for dismissal and made orders under Order 7 Rule 48(b) and (c) of the Supreme Court Rules to progress the matter further without delay. 

Case Cited:

Attorney General-v-Papua New Guinea Law Society (1997) SC530
Burns Philip (NG) Ltd-v-George [1983] PNGLR 55
General Accident Fire & Life-v-Ilimo Farm [1990] PNGLR 331
Kalinoe-v-Paraka (2007) SC874
Nicholas -v- Commonwealth New Guinea Timbers Ltd [1986] PNGLR 133
PNG Nambawan Trophy Ltd-v-Dynasty Holdings Ltd (2005) SC811
Tulapi-v-Aku (2011) SC1177.
Opi vs Telikom PNG Ltd (2020) N8290

Legislation cited:

Supreme Court Rules

Counsel:

R. Manrai, for the Appellants 
F. So, for the Respondents

DECISION

25th November, 2022 	

1.	BY THE COURT. This is an application by the Respondents seeking dismissal of the appeal for want of prosecution pursuant to Order 7, Rule 48 (a) of the Supreme Court Rules. The application is contested by the Appellants. Both parties are seeking cost on a solicitor-client basis in the event of a successful outcome in their favour.

2.	We heard arguments on 21st November 2022 and reserved our ruling which we now deliver.

Background Facts

3.	The first to the eleventh Appellants are senior employees of the twelfth Appellant, a company incorporated under the Companies Act. In proceedings, WS NO.20 of 2018, Mike Eki for and on behalf of himself, his family and 23 others and their families -v Stettin Bay Lumbar Co. Ltd & 14 others, the Respondents instituted proceedings claiming damages for unpaid entitlements and for breach of human/Constitutional rights against the Appellants. 

4.	On 12th December 2020, the trial Judge entered judgment for the Respondents awarding damages of K30,000.00 each to the 24 families. 

5.	The Appellants filed a Notice of Appeal on 20th January 2021. 
   
Issues

6.	The issues for consideration are:

1)	Whether the appeal should be dismissed for want of prosecution?
2)	Should costs be awarded on a solicitor-client basis to the successful party.

Law

7.	Order 7, Rule 48 of the Supreme Court Rules reads:

“48. Where an appellant has not done any act required to be done by or under these rules or otherwise has not prosecuted his appeal with due diligence, the court may—
(a) order that the appeal be dismissed for want of  prosecution; or

(b) fix a time peremptorily for the doing of the act and at the same time order that upon non compliance, the appeal shall stand dismissed for want of prosecution, or subsequently, and in the event of non compliance, order that it be so dismissed; or

(c) make any other order that may seem just.”

8.	The law on application for dismissal for want of prosecution under Order 7 Rule 48 is settled in various decisions of this Court. Refer to Burns Philip (NG) Ltd-v-George [1983] PNG LR 55, General Accident Fire & Life-v-Ilimo Farm [1990] PNGLR 331, Attorney General-v-Papua New Guinea Law Society (1997) SC 530, PNG Nambawan Trophy Ltd-v-Dynasty Holdings Ltd (2005) SC811, Kalinoe-v-Paralia (2007) SC874, Nicholas -v- Commonwealth New Guinea Timbers Ltd [1986] PNGLR 133, and Tulapi-v-Alu (2011) SC 1177.

9.	The principles enunciated from these cases are:

a)	The Court’s power to dismiss is discretionary.

b)	Where delay of prosecution is alleged, the applicant must establish by evidence a case for the Court to exercise its power in its favour before the burden shifts to the Appellant to provide an explanation for the delay and demonstrate its readiness to prosecute the appeal
(Tulapi-v-Alu).

c)	If any appellant has delayed in prosecuting his appeal, the appeal should be dismissed unless there are reasonable explanation for the delay (Kalinoe-v-Paraka).

d)	The absence of an explanation is fatal to a Respondent for dismissal where an explanation can quite properly be expected.
(PNG Nambawan Trophy Limited-v-Dynasty Holdings Ltd).

e)	The power to dismiss for want of prosecution should only be exercised when the Plaintiff’s default had been intentional and contumelious or where there has been inordinate and inexcusable delay on his or his lawyer’s part giving rise to a substantial risk that a fair trial will not be possible or to serious prejudice to the defendant. (Nicholas-v-Commonwealth New Guinea Timbers Ltd).

Consideration of Issue No.1 

Have the Respondents established a case for dismissal for want of prosecution?

10.	Mr. So of counsel for the Respondents submits that since the filing of the Notice of Appeal on 21st January 2021, the Appellants have done nothing to progress the appeal to a hearing despite warning letters being served.

11.	Mr. Manrai, counsel for the Appellants contends that the Appellants have a reasonable explanation for the delay. We will address that shortly in our ruling. For now, we will consider whether the Respondents have established a case. The facts are undisputed. The decision in the lower Court was made on 12th December 2020. The Notice of Appeal was filed on 20th January 2021. On 21st May 2021 an Order staying the decision of the lower Court was granted. Apart from attending to an interlocutory application (stay application), it seems no further activity was conducted until 8th September 2021 when a draft index to the appeal book was filed. The draft index to the appeal book is yet to be settled. The current application was filed on 4th August 2022, about 19 months after the filing of the Notice of Appeal, which on face value is a lengthy delay. This consideration favours the Respondents.

Have the Appellants provided an explanation for the delay in prosecuting the appeal.

12.	In response to the application, the Appellants submitted that they have a good explanation for the delay. Mr. Manrai relies on the facts deposed to in four affidavits sworn and filed by him as lawyer for the Appellants and these are:

 i) Affidavit in Response of Rex Manrai sworn 1st and filed 2nd September     2022.
 ii) Affidavit of Service of Rex Manrai sworn and filed 28th October 2022

 iii) Further Affidavit in Response of Rex Manrai sworn 11th and filed 12th October 2022
 iv)Affidavit of Rex Manrai sworn and filed 31st October 2022

From the facts deposed, there appears to be two main reasons for the delay in settling the Index to the Appeal Book:

a)	Unavailability of the Assistant Registrar.
b)	Lack of corporation by Respondents’ lawyers.

13.	Mr. Manrai explained that the draft index was filed on 8th September 2021. In consultation with the lawyers for the Respondents, an amended draft index to the appeal book was filed on 13th April 2022. Between April 2022 and August 2022, the draft index to the appeal book has been fixed for settlement eight (8) times.  Settlement did not proceed on the days scheduled for various reasons. On four occasions, the settlement was deferred due to the unavailability of the Assistant Registrar. On two occasions, it was deferred due to non-attendance by the lawyers for the respondents. The lawyers for the appellants diligently attended on each time when the matter was fixed for settlement, while the respondents’ lawyers did not attend at all despite being notified by either the lawyers for the appellants or the Supreme Court registry staff. The last time the matter was scheduled for settlement was on 11th August 2022. It could not proceed as the Appellants were served with the current application. 

14.	We consider the explanation for the delay provided by the lawyers for the appellants reasonable and well documented and we accept same. 

15.	We also note the concerns raised by counsel for Appellants that the lawyers for the Respondents did not cooperate with them. The respondents’ lawyer’s office was closed for a while at the relevant time and made it difficult for service.  They did not respond to correspondence and emails sent. They did not attend court to settle the draft index. In short, the Appellants are saying, that the lawyers for the Respondents did not cooperate and contributed to the delay in prosecuting the appeal. 

16.	Whilst lawyers have a duty to their clients, their first duty is to the Court. They also have an ethical duty to their colleagues. They are expected to be courteous and cooperate where necessary to prepare for the final resolution of the dispute between their respective clients. In the present case the conduct of the lawyers for the Respondents is wanting. They contributed to the delay.

Conclusion

17.	In conclusion, we find that the Appellants have provided a reasonable explanation for the delay. We are not persuaded that the delay is intentional and contumelious. Having considered the various principles in the light of the facts of this case, we are of the view that it is not in the interest of justice to shut out the Appellants from the judgment seat. We will therefore refuse the Respondents application.  

Issue No 2. Whether cost should be paid on a solicitor-client basis 

18.	The final matter for consideration is the question of costs. The Appellants seek costs on a solicitor-client basis.
 
19.	In the Opi v Telikom PNG Ltd (2020) N8290, his Honour, Shepherd J considered the principles applying to solicitor-client costs, at paragraph [235] of his judgment which reads:

“235. The salient principles which I consider can be distilled from these Australian cases and the cases in our jurisdiction which I have referred to are these:..
(1) ……	
(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) ……..	
(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.”

20.	We adopt and apply these principles in the present case.

21.	This is an appropriate case for costs to be awarded on a solicitor-client basis. Firstly, the application is premature. The lawyers for the Respondents did not disclose all the facts in the material filed in support of their application. They did not cooperate with the lawyers for the Appellants and contributed to the delay.   Secondly, the Respondents’ lawyers were forewarned by letter dated 14th October 2022 that if they fail in their application, costs would be sought on a solicitor client basis.  For the foregoing reasons, we are inclined to award costs in favour of the Appellants on a solicitor-client basis.

22.	This matter must not be further delayed by either party.  Accordingly, we make the following orders.

Orders

The Court orders that:

1.	The Respondent’s application for dismissal for want of prosecution is refused.

2.	The parties settle the index to the Appeal Book in consultation with the Registry by 5th December 2022.

3.	The Appellants shall file the Appeal Book by 31st January 2023.

4.	The Parties shall attend before the Listing Judge by mid-February 2023 for directions and listings.

5.	The Respondents shall pay the Appellants’ costs of the application on solicitor-client basis to be taxed, if not agreed.

_____________________________________________________________
Manrai Lawyers: Lawyers for the Appellants
Ketan Lawyers:  Lawyers for the Respondents