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Independent State of Papua New Guinea v Mollen [1997] PNGLR 193 (19 November 1996)

[1997] PNGLR 193

PAPUA NEW GUINEA

[SUPREME COURT OF JUSTICE]

INDEPENDENT STATE OF PAPUA NEW GUINEA;
AND;
THE COMMISSIONER, CORRECTIVE INSTITUTION SERVICES

V

DANIEL MOLLEN

WAIGANI: AMET CJ; KAPI DCJ; LOS J
13 June, 19 November 1996

Facts

The respondent successfully sought a judicial review of his dismissal in the National Court on 2 November 1995. The National Court ordered his reinstatement and further ordered that his full entitlements and benefits be restored to him.

The appellants filed a Notice of Appeal on 12 December 1995. The appellants did not serve the Notice of Appeal on the respondent until 12 June 1996. It also failed to prosecute the appeal on 12 June 1996. The appellants were ordered by the National Court to file an application for stay of proceeding. The applicants applied to the Supreme Court for the stay of the National Court orders made on 2 November 1995.

Held

1. An applicant for a stay order is not required to show a "special" or "exceptional circumstances" to succeed in his or her application. PNG v Gulf Provincial Government [1994] PNGLR 34 discussed.
   
2. The discretion to grant or not to grant stay proceedings under s 19 of the Supreme Court Act (Ch 37) is an unfettered discretion. Alexander v Cambridge Credit Corp Ltd [1985] 2 NSWLR 685 followed.
   
3. To succeed in an application for a stay proceeding, the applicant has to show that he or she has a reason or an appropriate case.
   

Papua New Guinea cases cited

PNG v Gulf Provincial Government [1994] PNGLR 34.

Other case cited

Alexander v Cambridge Credit Corp Ltd [1985] 2 NSWLR 685
Re Middle Harbour Investments Ltd (In Liq) (Court of Appeal, 15 December 1976, unreported)

Counsel

P Mogish, for the appellants.
A Corren, for the respondent.

19 November 1996

BY THE COURT. The respondent in this case was dismissed by the second appellant from his position as Assistant Correctional Officer. He applied for judicial review of his dismissal. The National Court ordered that he be reinstated to his original position with full restoration of all benefits, grading, rank and all lost salaries back dated to 13 April 1990. This decision was handed down on 2 November 1995.

The State filed a Notice of Appeal against this decision on 12 December 1995. But no further steps have been taken to prosecute the appeal. The orders made by the National Court have not been complied with.

According to the affidavit of Mrs. Mogish, the respondent filed a motion for hearing in the National Court on 12 June 1996 against the Solicitor-General and Deputy Commissioner CIS to show cause why they should not be charged for contempt of court for failing to comply with the National Court orders. It is not clear to us what happened at the hearing of the motion on 12 June 1996. The State however, was ordered to make an application within twenty-four hours to stay the National Court orders pending the determination of the appeal. As a consequence of this ruling, the appellants filed this application for stay.

Counsel for the appellants has submitted that the grounds of appeal are likely to succeed. Therefore in the interest of justice we should grant the stay orders pending the determination of the appeal. Counsel for the respondent made his submissions in the alternative. First, he submitted that an application for stay must be made within the forty days of the decision appealed against. This he submitted is the combined effect of ss 17 and 19 of the Supreme Court Act (hereinafter referred to as "the Act"). As the application is made outside the forty days period, he submitted that the application is incompetent.

Alternatively, he submitted that if the application is competent, in the exercise of our discretion we should not stay the orders on the basis that there has been considerable delay (1) in not serving the respondent with the Notice of Appeal until he became aware of it at the hearing of his notice of motion on 12 June 1996, and (2) that the application for stay has been delayed by some eight months after the judgment in question. He submitted that the right of the respondent in enjoying the fruits of the judgment has been delayed already. In view of the fact that he has been without a job since 1990, any further stay would prejudice his rights.

First, we will deal with the submission that an application to stay must be made within the forty days of the decision appealed against. It is necessary to set out the terms of ss 17 and 19 of the Act:

"17. Time for appealing under Division 2.

Where a person desires to appeal to or to obtain leave to appeal from the Supreme Court, he shall give notice of appeal, or notice of application for leave to appeal, as the case may be, in the manner prescribed by the Rules of Court within 40 days after the date of the judgment in question, or within such further period as is allowed by a Judge on application made to him within that period of 40 days.

19. Stay of proceedings on appeal.

Unless otherwise ordered by the Supreme Court or a Judge, an appeal, or an application for leave to appeal, to the Supreme Court does not operate as a stay of proceedings."

We cannot accept the submission of counsel for the respondent that an application for stay pending appeal has to be made within the forty days of the judgment in question. It is plain from the wording of s 17 of the Act that the forty days limitation is confined to a notice of appeal and an application for leave to appeal. It has no relevance to an application to stay proceedings.

Section 19 is not made subject to s 17 of the Act. There is no time limitation imposed on an application that may be made to invoke the power of the Supreme Court or a Judge to stay a proceeding under s 19 of the Act.

We now consider the alternative submission. There are not many reported cases setting out the proper principles for granting a stay pending appeal. In PNG v Gulf Provincial Government [1994] PNGLR 34, the Supreme Court held that the power of the Supreme Court to grant a stay pending appeal is an unfettered discretion but should only be exercised where "special" or "exceptional circumstances" are shown. With respect this conclusion was reached without a close analysis of the terms of s 19 of the Act. We note that s 19 does not have the requirement "special" or "exceptional" circumstances in its terms. It simply states, "Unless otherwise ordered by the Supreme Court or a Judge" those words clearly indicate that there is an unfettered discretion in the Court to stay proceedings pending appeal. The requirement that "special or exceptional circumstances" need to be shown before the discretion is exercised in favour of granting a stay maybe a restriction of the discretion of the Court, which is not included either expressly or by implication under s 19 of the Act.

In our research we have found that the Court of Appeal in New South Wales in Alexander v Cambridge Credit Corp Ltd [1985] 2 NSWLR 685 had an occasion to reconsider the formulation of the proper principles. An older line of cases which formulated the principle that unless the appellant can show "special" or "exceptional" circumstances that warrant the imposition of a stay, a judgement creditor is entitled to the fruits of his judgment. This old line of cases is similar to the Supreme Court decision in PNG v Gulf Provincial Government (supra).

The relevant provisions in NSW is to be found in the Supreme Court Rules, 1970, Pt 51, r 10 which reads:

"10. An... appeal to the Court of Appeal shall not-

(a) operate as a stay of execution or of proceedings under the decision of the court below;

(b) invalidate any intermediate act or proceeding, except so far as the Court of Appeal may direct or, subject to any direction of the Court of Appeal, as the court below may direct."

In examining the principles in the light of the rules, the Court of Appeal gave three reasons why the principles should be reconsidered. It is not necessary to set out all the reasons. We are content to refer to only one. At page 693 the Court said:

"First, there is no suggestion in the rule that 'special' or 'exceptional' circumstances must be established before the discretion conferred upon the Court will be exercised. This is significant because, where the Act or the rules contemplate the need for special or exceptional circumstances to warrant a particular course they generally say so. For example, the very next rule (Pt 52, r 11) dealing with security for costs of an appeal says, in terms, that such an order may be made 'in special circumstances'. No such limitation appears in Pt 51, r 10: cf also Supreme Court Act 1970, s 75A. If it had been contemplated that 'special circumstances' were required or that 'exceptional circumstances' should be established to attract the discretion to grant a stay pending appeal, it might have been supposed that the legislature would have said so in terms. The absence of such a provision implies, at least in the practice of this Court, that no such requirement exists."

The Court adopted a passage from the judgment of Mahoney J. as correctly stating the proper principles in Re Middle Harbour Investments Ltd (In Liq) (Court of Appeal, 15 December 1976, unreported):

"Where an application is made for a stay of proceedings, it is necessary that the applicant demonstrate an appropriate case. Prima facie, a successful party is entitled to the benefit of the judgment obtained by him and is entitled to commence with the presumption that the judgment is correct. These are not matters of rigid principle and a court asked to grant a stay will consider each case upon its merits, but where an applicant for a stay has not demonstrated an appropriate case but has left the situation in the state of speculation or mere argument, weight must be given to the fact that the judgment below has been in favour of the other party."

The Court then concluded:

"In our opinion it is not necessary for the grant of a stay that special or exceptional circumstances should be made out. It is sufficient that the applicant for the stay demonstrates a reason or an appropriate case to warrant the exercise of discretion in his favour."

This issue was not fully argued by the parties in this case. Therefore, we are unable to determine these issues conclusively. The question of what is the proper test under s 19 of the Supreme Court Act (Cap. 37) should be determined in a future case.

Whatever the precise terms of this test maybe it is clear that the onus is on the appellants to satisfy the Court that the orders made by the National Court should be stayed. The conduct of the appellants in prosecuting this appeal to this point has a lot to be desired. Order 7 rule 12 of the Supreme Court Rules requires that a notice of appeal must be served on all parties without delay. On the materials before us the Notice of Appeal was not served on the respondent until he became aware of it at the hearing of his motion on 12 June 1996.

Since the filing of the Notice of Appeal no further steps have been taken to prosecute the appeal. We note that the grounds of appeal raise questions of law and therefore steps should have been taken to proceed with the appeal without undue delay. The attitude displayed by the appellants' conduct clearly indicate that there is no interest on the part of the appellants to prosecute the appeal with due speed. In the mean time the respondent has not had any benefit of the judgment in his favour. To further delay the execution of the National Court orders will further prejudice the rights of the respondent.

Applying the present test, the appellants have failed to satisfy us that "special" or "exceptional" circumstances exist which would warrant the imposition of a stay.

We dismiss the application to stay with costs to the respondent.

Lawyers for the appellants: Solicitor-General.
Lawyers for the respondent: Corren Lawyers.