SC2744
PAPUA NEW GUINEA
[SUPREME COURT OF JUSTICE]

SCA 33 OF 2024

BETWEEN:
KAPAN LAPET
Appellant

AND:
MOTOR VEHICLES INSURANCE
LIMITED
Respondent

WAIGANI: HARTSHORN J.
6 AUGUST, 4 OCTOBER 2024

COSTS - Application for security for costs

Cases cited

Brinks Pty Ltd v. Brinks, Incorporated [1996] PNGLR 75

Counsel

Ms. N. Noringi for the respondent

1.   HARTSHORN J: This is a decision on a contested application by the respondent for security for costs. Reliance is placed amongst others, upon s.18(1) Supreme Court Act. 

Background 

2.  The appellant commenced a proceeding in the National Court seeking damages. This was for injuries he allegedly sustained as a passenger in a motor vehicle accident on 9th  November 2015. The proceeding was dismissed on 20th March 2024 and the appellant filed this appeal on 25th April 2024. 

3.  The respondent applies for security for costs on numerous grounds. I permitted the application to proceed in the absence of representation on behalf of the appellant as I was satisfied on the evidence that the lawyer for the appellant had been served with the application and had been notified of the hearing date and time of the application.

Consideration

4.  The application is made under s. 18(1) Supreme Court Act amongst 
others. Section 18 (1) is as follows:

“The Supreme Court or a Judge may, in special circumstances, order that just security be given for the costs of an appeal or an application for leave to appeal and, if an application is granted, for the prosecution of the appeal.”

5.   The judgment of the Supreme Court which is on point is of the full Court in Brinks Pty Ltd v. Brinks, Incorporated [1996] PNGLR 75. In that judgment, in considering s. 18(1) Supreme Court Act and the reference to “special circumstances” the Court said:

“In determining the nature of what these “special circumstances” are, we think it is relevant to have regard to the circumstances upon which the National Court may order security for costs set out under O 14 r 25 of the National Court Rules. We say these Rules are relevant because they seek to protect a defendant’s costs in the event that he is successful in an action. By analogy, the position is the same in an appeal. A respondent may be protected by an order for security for costs of the appeal in the event that he is successful in the result of an appeal. The difference is that in the National Court Rules, the circumstances upon which an order for costs may be made are particularised, whereas, under the Supreme Court Act, the circumstances are simply referred to as “special circumstances”. It is within the discretion of the Court to determine what these “special circumstances” are.

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.    The first factor, that the appellant is ordinarily resident outside of Papua 
New Guinea, does not apply in this instance. The second factor, that there is 
reason to believe that the appellant will be unable to pay the costs of the 
respondent if ordered to do so, is a factor relied upon by the respondent.

7.   Here, the appellant pleads in his statement of claim which is in evidence 
before this court, that he is a villager and a subsistence farmer who earns 
an average weekly income of K300.00. He is not employed and does not 
generate income from other sources. Further, the lawyer for the appellant in 
an affidavit filed in response to this application, which was relied upon by 
the lawyer for the respondent, deposes, amongst others, that the appellant is 
only a villager and, “cannot afford". 

8.   I am satisfied therefore, that it has been shown by the appellant that a 
special circumstance exists in this instance. That is that there is reason to 
believe that the appellant will be unable to pay the costs of the respondent if 
ordered to do so.

9.   As to the second factor, that the address of the appellant is not known, the address given of the appellant in his notice of appeal is a post office box number. It is the same as the post office box number given for his lawyer. 
There is no other address given for the appellant in the notice of appeal.
The village and area for the appellant is pleaded in the statement of claim. It 
is Mulitaka Village, Laigam District, Enga Province. Notwithstanding that 
the village and area in which the appellant resides is given, it is not the 
appellant’s physical address. The postal address given, as mentioned, is that 
of his lawyer. If the lawyer ceases to act for the appellant, it will be difficult 
to contact and locate the appellant. In these circumstances, I am satisfied that 
the special circumstance, that the address of the appellant is not 
known, has been established.

10.  The third factor, concerning a change of address, is not relevant in this 
instance.

11.   As to other circumstances which may come within “special 
circumstances”, as referred to in Brinks v. Brinks (supra), the “Rules” seek 
to protect the costs of a defendant and by analogy in an appeal, the costs of a 
respondent. Consequently, whether a plaintiff/appellant has assets within 
Papua New Guinea which may be attached within Papua New Guinea in the 
event of an order against the appellant for costs, in my view is a special 
circumstance. In this instance, there is no evidence that the appellant has any 
assets.

12.  As to the merits of the appellant’s claim, I proceed on the basis that the
appellant has an arguable case. I do not consider the merits of the appeal.

13.  Consequently, as I have found that two special circumstances as referred 
to in Brinks v. Brink (supra) have been established in this instance, being 
that there is reason to believe that the appellant will be unable to pay the 
costs of the respondent if ordered to do so and that the address of the 
appellant is not known, together with there not being any evidence of the 
appellant having any assets, I am satisfied that it has been satisfactorily 
established that the respondent is entitled to an order for security for costs. 
Further, the respondent has provided the required evidence of the likely 
costs and outlays of defending the appeal.

14.  Given the above, it is not necessary to consider the other submissions of 
counsel.

Orders

a)	The appellant shall pay the sum of K25,000.00 as security for costs.

b)	The said sum of K25,000.00 shall be paid by the appellant into court by 15th November 2024.

c)	The costs of and incidental to the amended application for security for costs filed 25th June 2024 are costs in the appeal.
_____________________________________________________________
Lawyers for the appellant: Danny Gonol Lawyers                    
Lawyers for the respondent:  Jema Lawyers