Kapie v Motor Vehicles Insurance (PNG) Trust [1986] PNGLR 78 (17 March 1986)

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INFANTS AND CHILDREN - Sanctioning of settlements - Compromise of action for benefit of infants - Prior payments to infant under statute - Whether deductible from orders sanctioned - Whether for benefit of infant - Protection of payments to infant required - Motor Vehicles (Third Party Insurance) (Basic Protection Compensation) Act (Ch No 296), s 23(1)(b).

COURTS AND JUDGES - National Court - Jurisdiction and powers - As parens patriae - Power to act for protection of infant - Sanction of compromise of action - Prior payments to infant under statute - Motor Vehicles (Third Party Insurance) (Basic Protection Compensation) Act (Ch No 296), s 23(1)(b).

PRACTICE AND PROCEDURE - Sanctioning settlements - Compromise of action for benefit of infant - Prior payments to infant under statute - Whether deductible from orders sanctioned - Whether for benefit of infant - Protection of payments to infant required - Motor Vehicles (Third Party Insurance) (Basic Protection Compensation) Act (Ch No 296), s 23(1)(b).

DAMAGES - Torts - General damages - Deduction of award under other legislation - Where payment to infant - Powers of court - Duties of assessment officer - Motor Vehicles (Third Party Insurance) (Basic Protection Compensation) Act (Ch No 296), s 23(1)(b).

The Motor Vehicles (Third Party Insurance) (Basic Protection Compensation) Act (Ch No 296) (the Compensation Act) provides that on the occurrence of a motor vehicle accident causing death an assessment officer may conduct an inquiry to determine who might be entitled to payment and the amount thereof, subject to statutory limits.

Section 25(1)(b) of the Compensation Act provides that any award of damages made in subsequent proceedings (under the Wrongs (Miscellaneous Provisions) Act (Ch No 297) “shall be reduced” by the amount of the basic protection compensation.

Following the death of the head of a family an assessment officer made orders under the Compensation Act for payment of K2000 divided equally amongst the widow and three children including two infant children. Both infant children gave a receipt acknowledged by a mark for their share.

On an application to sanction a settlement on behalf of the infant children in an action on their behalf the defendant sought to have deducted from the sum to be sanctioned the moneys already paid to the infant children.

(1) There being no conflict between the powers of the National Court as parens patriae and the Compensation Act, the strictures which apply to judgments, compromises and settlements to which an infant is a party in the National Court should apply also to awards made by an assessment officer to or for an infant under the Compensation Act.

(2) In the absence of any evidence that the infant children in the present case had received the benefit of the money paid to them under the Compensation Act, or that the money was held in trust for them, the compromise should not be sanctioned.

This was the hearing of an ex parte motion pursuant to the National Court Rules, O 5, r 3, to sanction a compromise of a damages claim brought under the Wrongs (Miscellaneous Provisions) Act (Ch No 297) on behalf of infant children.

MCDERMOTT AJ: This matter came before me by way of ex parte motion on behalf of the plaintiff for certain orders to which the defendant Trust consents.

On 25 September 1985 the plaintiff on her own behalf and on behalf of her infant children brought an action under the Wrongs (Miscellaneous Provisions) Act (Ch No 297) (the Wrongs Act) against the defendant Trust claiming damages following the death of Tapie Dewa on whom they were dependent. The deceased died in a motor vehicle accident on 27 October 1983.

Damages have been agreed upon and I am asked to sanction a compromise of the action and for orders on behalf of the infants under the National Court Rules, O 5, r 3. At the outset I say that I am satisfied on the amount of the compromise, but I am asked to deduct from this sum, moneys already allegedly paid to the infant children and this is a matter of concern.

The problem arises from the operation of the Motor Vehicles (Third Party Insurance) (Basic Protection Compensation) Act (Ch No 296) (the Compensation Act). Although this Act was passed in 1974 this appears to be the first time that an apparent conflict between the parens patriae powers of the court and the powers of an assessment officer under that Act has arisen. The whole scheme of the Compensation Act is to provide a limited form of no fault liability payments to certain defendants and clan members of persons killed in a motor vehicle accident. Whilst that is the effect of the legislation its purpose, if my memory of its introduction is correct, was to cool down tempers, particularly in highland areas, following a motor vehicle caused death in the clan. A quick payment of money was to bring this about. The right of these dependants to sue for damages according to law remained, subject to a subsequent reduction in the amount of damages so recovered, by the amount of any prior award made under the Compensation Act.

In view of the nature of a claim the processes under the Compensation Act are simple. A claim is made to an assessment officer, who is not necessarily a magistrate, in the area where the accident occurred. He then conducts an inquiry to see if the death resulted from a motor vehicle accident, determines what persons are entitled to a payment, and the amount of it. The Act sets limits: K2000 where a deceased left a dependent wife and child; K1500 in any other case where there are no dependents and the claim is made by members of the deceased’s immediate customary group. In making an assessment, regard is had to the customary disposition of property on death; the economic loss suffered by any or all of the entitled persons; and any other fact that the assessment officer thinks relevant. See s 19(3).

In this case an order was made on 9 November 1983 against the Trust for the payment of K2000 divided equally amongst Kobari Iraitogo, Memura Tapie, Komane Tapie and Mo Tapie. The last two mentioned are the children of the deceased aged respectively 11 and 8 years, at the time of his death. It appears that Kobori is in fact the plaintiff and that Memura is a child over the age of 16 years and not dependent for the purposes of the later cause of action. The assessment officer’s reason for the award was:

“The deceased was the head of the family who (would) contribute in full to maintain his wife and three children. The deceased had a brother and sisters.”

An award under the Compensation Act is enforceable as an order for the payment of a sum of money made by a District Court (s 22). Although the award appears to have been made by an assessment officer at Kundiawa, payment was effected at the District Office Chuave on 4 January 1984. The defendant Trust, in compliance with the order made out four cheques, each payable to the persons named in the award. Four receipts were obtained. A councillor Aino appears to have had something to do with the receipt of the cheque for Kabori Iraitogo (the plaintiff) as his name appears on it. The receipt by the others was acknowledged by the placing of a mark upon it.

Immediate questions then arise. How can an infant acknowledge receipt? How can an infant negotiate the cheque? The unsatisfactory answers are simple. Today, nobody knows or at least no one can tell me, what has become of the awards made for the infants. It would not be difficult to speculate — the demands of an extended family are very great. Yet this Court is now asked to sanction a settlement on behalf of these infants which contains this uncertainty. The Court is asked, as a matter of law, to disregard this uncertainty and yet make it part of an order. I say this because the Trust in correspondence before me relies upon s 25(1)(b) of the Compensation Act which provides that an award of damages shall be reduced by the amount of basic protection compensation. There is no provision for requiring proof of payment of that compensation but just of the award of it. I appreciate the Trust’s position. It has complied with the order made against it. But the Act does not stand alone. It can be enmeshed in a separate action under the Wrongs Act and therefore in any subsequent settlement of that action. That being so, it appears to me that something more than mere compliance with an order for compensation, when it is made for the benefit of an infant, is necessary. If reliance is placed on this order, in accordance with the Compensation Act, surely some accounting is necessary to ensure that the infant received the money and received it in the terms in which it was meant, according to the reasoning of the assessment officer, in order “to maintain” the infant. The award is similar to the claim at law; both are based upon a dependency. It is thus difficult to see why the concern of the court to protect the interests of the child in one situation should not apply to the other. Hence the apparent conflict in this case arises.

The power of the court is clearly expressed in Monomb Yamba v Maits Geru [1975] PNGLR 322 and supports “the well established rules for protection of infants” canvassed in Maria Akawe v Wells [1973] PNGLR 334 and particularly at 337 where the court alluded to the danger of money received on behalf of infants being considered family money. And in Bradford v Bradford [1975] PNGLR 305 at 309 is a timely reminder of the tendency to confuse the availability of moneys awarded to an infant with the continuing liability of a parent to maintain a child. These cautions are particularly apposite in view of the cheque distribution in this instance. The remarks of the court in Arabian v Tufnall and Taylor Ltd [1944] KB 685 at 688 are also relevant. Where an infant is a party to proceedings before the court, it is the interposition of the court, charged with the duty to watch over his interests, that lends sanctity to a judgment for or against him.

The Compensation Act is silent on two aspects: (1) how payment on behalf of infants is to be effected and (2) protection of these payments for infants. As the power of this court in relation to infants is firmly grounded in the Constitution, s 158(1) and s 166(1), I cannot see why these protective powers should be waived for the purpose of adopting and hence sanctioning a lesser standard in others, through the operation of a statute, silent on the protection (the statute belies its name) to be afforded to infants.

I have come to the view that there is no conflict between the Compensation Act and the powers of the National Court. Rather the problem has arisen because the need to act protectively on behalf of infants was not perceived in the legislation or in the administrative arrangements made for its implementation. But the need to so act is implicit in it. A clear administrative direction to assessment officers should solve the problem but not, alas, in the present case. Mr Neill has quite correctly directed my attention to the actions which an infant might take on reaching majority but it appears to me that the wrongdoing or negligence rests not in the unsophisticated extended family but with those who pay out the money. But that is not for me to decide.

In my judgment, the strictures which apply to the judgments, compromises and settlements to which an infant is a party in the National Court must also apply to awards made by an assessment officer if they are later to be taken into account in the National Court. The practice of the National Court in this regard is a suitable example to follow. Indeed, the paucity of legislation relating to judgments obtained by infants might suggest that use be made of the Registrar’s arrangements in this regard. I note in passing that learned counsel, when involved in these claims at an early enough stage, ensures that awards on behalf of infants are placed in suitable trust accounts. That the Compensation Act does not run to that detail does not imply that the underlying principle for such care, does not apply.

In the absence of any evidence that the infants have received the benefit of the compensation money already paid out, or that this money is held in trust for them, I will not sanction the compromise in its present form. However I am prepared to make supplementary orders so that the bulk of the settlement can be paid into Court on the infants’ behalf.

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Papua New Guinea Law Reports

Kapie v Motor Vehicles Insurance (PNG) Trust [1986] PNGLR 78 (17 March 1986)

Papua New Guinea Law Reports - 1986