Kela v MVIL [2004] PGDC 20; DC177 (7 May 2004)

DC177

PAPUA NEW GUINEA
[IN THE DISTRICT COURT OF JUSTICE]

CASE NO 269 OF 1996

Issac Kela

V

M V I L

Mt. Hagen: M.M. Pupaka
2004: 7th May

PRACTICE AND PROCEDURE – Application to set aside ex parte judgment – Requirements in the case of Green –v- Green [1976] PNGLR 73 – Prior conduct of both parties such as to constitute a reasonable explanation for allowing judgment to be entered – Set aside application filed within reasonable time – Applicant must set out in affidavit the material facts which give rise to a defence on the merits – Case of Leo Duque – v- Avia Andrew Paru SC Appeal N0. 25 of 1996 (SC510)

Cases Cited:
Green and Co Pty Ltd v Green [1976] PNGLR 73
The State of PNG and Davies v Barker [1977] PNGLR 386
Barter v The State PNG & Buy [1976] PNGLR 340
George Page Pty Ltd v Malipu Bus Balakau [1982] PNGLR 140
Leo Duque v Avia Andrew Paru SC N0. 25 of 1996 (SC510)

Counsel
Ms. Stegman for the Complainant /Respondent
Mr. Kak for the Defendant /Applicant

7th May 2004

M. M. PUPAKA: The Notice of Motion herein dated 16/03/04 was listed to come before me after Mr. Appa who normally would preside over matters of this nature declined to deal with it for reasons, which are now matters of record. Consequently the matter came before me first on 14/04/04 and again on 19/04/04. On both these occasions all parties failed to attend. However they were present at the third and final scheduled mention date – 23/04/04. Ms. Stegman and Mr. Kak for the respondent and applicant respectively, agreed to have the motion heard on 30th April 2004, on which date Mr. Peri of council who was said to have carriage of the matter on behalf of the respondent, was to attend and argue against the notice of motion. However on the 30th of April only Mr. Kak appeared, who then advised the Court that the parties had already filed their affidavit evidence and indeed their respective submissions and their common desire was for the Court to consider their respective affidavits and submissions and rule on the application. I found no fault with this and directed that the matter proceed forth as requested. The parties’ preferred way of having the application dealt with initially before Mr. Appa was in that way anyway.

Consequently I have perused all the affidavit evidence and the records of proceedings. I now wish to consider the respective sides’ arguments and rule on the application accordingly.

[a] The requirements of binding case precedents and guiding principles generally

At the outset though, I must state the guiding principles in this sort of application, i.e., applications by way of a motion upon notice to set aside default judgments. It is trite that the applicable principles have their origin in the case of Green v Green [1976] PNGLR 73. Later cases, whose precedents are binding, have confirmed these principles as mandatory requirements. For instance in the case of State & Davies v Barker [1977] PNGLR 386, the Supreme Court confirmed the need for an applicant seeking to set aside ex parte orders to show a defence on the merits.

Other later cases have also stressed the need for an applicant to establish by evidence good cause for default judgments regularly entered to be set aside. More particularly the applicant must, by affidavit evidence, advance reasonable explanation as to why judgment was allowed to be obtained by default in the first place and the application must be made within reasonable time. If there has been delay, then a plausible explanation ought to be given as to why there was delay in bringing the application.

See also the cases of Barter v The Government of Papua New Guinea and Buy [1976] PNGLR 340; and George Page Pty Ltd v Malipu Bus Balakau [1982] PNGLR 140.

[b] Has this Applicant provided a reasonable explanation as to why it allowed ex parte judgment to be entered against it in the first place?

I think it has. Even though much of the assertions of Mr. Goodwin George Poole in his affidavit dated 9th March 2004 is self serving, in that he tries to place fault solely upon the complainant as to why a properly contested hearing never took place, the affidavit nevertheless also highlights the level of confusion and inconveniences that are routinely created between claimants from the Provinces and the MVIL. The MVIL lawyers are usually centrally located in Port Moresby, and at times there would be communication breakdowns and misunderstandings. Also in some instances, when cases are listed for hearing and MVIL lawyers are in attendance on the nominated day at places like Mt. Hagen, a scheduled trial may not proceed, for one reason or other, causing much inconveniences, including blowout of costs. So one can understand why the MVIL lawyers are cautious in traveling to a place of trial, unless they are certain that there will be a trial.

From experience I would say that in places like Mt. Hagen the courts have been conscious of the dangers of overly penalizing the MVIL for allowing a claimant to obtain default judgment. Given the prevailing circumstances, the MVIL may not know that preparations were being made to obtain ex parte orders and months may lapse before it becomes aware that an ex parte order has been obtained against it.

In the instant case, going by the file records, the complainant has had a ‘stop start’ sort of approach to the prosecution of his claim. In the circumstances it is of very little consequence for the purpose of this application to meticulously digress into the details of what happened, where things went wrong and why. It must suffice for the current purposes to just say that both parties seem to have been at fault, in one way or other. From September 1996 when the proceeding was instituted, to 21st February 2002 when the ex parte application was made, is nearly seven (7) years, which by anyone’s standard, is such a long time. Whilst the complainant may justifiably be accused of ‘sleeping’ on his case the defendant must take the blame for not forcing matters to a head sooner. In fact the MVIL is on record has not having attended a scheduled hearing fixture on 9th December 1999, before myself incidentally, even though the clerk had duly advised it in writing!

I also note in passing by the way, that the presiding magistrate (by whom the ex parte order was granted) did not hand down a decision on the application for two years.

As it can be seen, a few things happened, and did not happen too, since 1996. In the circumstances I think it could be fair to say there is at least an explanation as to why judgment was allowed to be obtained or to put it another way, not prevented from being obtained. However it does not mean the complainant was not entitled to obtain ex parte audience, and indeed ex parte judgment, against the defendant. As I said the defendant should have thought it best, within its interests really, to force matters to a head, perhaps by applying for a summary dismissal on the bases of lack of due prosecution for instance. It cannot now try to blame the complainant for obtaining ex parte judgment, which is a remedy permissible at law. The application for ex parte judgment in this matter, to my mind, was quite regular anyway.

[c] Has the MVIL applied within reasonable time to set aside the ex parte order?

In stark contrast to the dilly dallying and the ‘stop start’ that went on prior to the entry of judgment, the MVIL seems to have almost rushed to court with this current application. The formal order was taken out on 26th February 2004. The MVIL filed this application on 16th March 2004, which is within less than a month. Needless to say the MVIL has come to court within reasonable time for the purpose of this proceeding.

[d] Has the MVIL, by affidavit evidence, shown a Defence on the merits?

This is the most pivotal of the three requirements of Green –v- Green (supra). Without material facts showing a defence known in law an applicant cannot succeed in his quest for the matter to be reinstated. In the end there really would be no apparent purpose in reinstatement without a defence being available to the applicant /defendant.

The tenor of language of the precedents is that the odds are stacked against an applicant who does not clearly disclose up front by affidavit evidence a defence on the merits. Merely attaching a proposed defence, or as in this instance, relaying as a matter of course on a defence already filed, does not adequately comply with the requirements.

In the case of Leo Duque v Avia Andrew Paru SC N0. 25 of 1996 (SC510) the Supreme Court comprehensively stated what may and what may not amount to disclosing a defence on the merits in applications such as this instant one. The following passage in that judgment succinctly highlights the issue and it is worth quoting in full in order for the whole requirement to be properly appreciated.

"Counsel for the respondent has conceded that the trial judge failed to consider whether there was any defence on the merits.

Both counsel have agreed that, as there was evidence led on the question of defence on the merits and that parties argued these matters, this was an issue the trial judge ought to have determined. It follows from this that this Court has jurisdiction to enquire into the issue and give its decision (see s. 16 (c) of the Supreme Court Act (Cap 37)).

The appellant relies on the affidavit of Mr. George T Yapao who was the new lawyer for the appellant. He made the application to set aside judgment. He annexed a proposed defence and simply deposed in paragraph 7 of his affidavit the following: "Upon instructions I know and believe that if this judgment is set aside and the matter is allowed to proceed to trial proper the Defendant has a good prospect of success."

Counsel for the respondent has submitted that this affidavit failed to provide any material facts giving rise to a defence on the merits.

The appellant himself also filed an affidavit in support of the application. Counsel for the respondent has submitted that this affidavit also failed to raise any facts, which would give rise to a defence on the merits.

On the other hand, counsel for the appellant has submitted that it is sufficient for the lawyer to simply make reference to his instructions and simply express a legal opinion that there is a defence on the merits.

It is clear to us from the authorities we have set out earlier in our judgment and subsequent cases in this jurisdiction that as a matter of practice, an applicant must in an affidavit state material facts showing a defence on the merits.

In the present case it was the responsibility of the appellant to state material facts showing a defence on the merits. As we have indicated before, the appellant filed an affidavit setting out the reasons why judgment was entered but he failed to state any facts, which shows any defence on the merits. A proposed defence prepared by the lawyer is not capable of serving this purpose. The expression of opinion by the lawyer that there is good prospect of success can only amount to a legal opinion. It is not capable of raising the material facts".

[Emphasis added]

As a matter of practice and requirement of law, applicants who seek to set aside ex parte or default judgments obtained regularly must disclose a defence on the merits by affidavit evidence. Attaching a proposed defence or alluding to one already filed or served without mention of any facts disclosing and defining that defence is not sufficient discloser.

In paragraph two (2) of Mr. Goodwin George Poole’s affidavit, filed in support of this application, reference is made to the defence of contributory negligence. I would immediately say that on its own that assertion is not sufficient. It cannot be adequate aversion of facts disclosing the defence referred to. However in paragraph three (3) of the affidavit, Mr. Poole gives what I think is a fair description of the defence of contributory negligence that he alludes to in paragraph two (2). He speaks of an allegation of consumption of liquor by the deceased and the driver prior to commencement of their travel.

Mr. Poole also says further and I quote, "the plaintiff, who pursuing (sic) a dependency claim, had already received in excess of K13, 000.00 plus 13 pigs under various heads of payment as a result of the death of his son in the accident". Now this is not a heck of a lot of material facts, however I do think it is sufficient factual discloser of the complainant having received payment in respect of the death of the deceased. As to whether the complainant did receive such payments and whether he is entitled to receive more and by how much are matters of argument at a trial proper. The brief facts asserted should suffice for the time being, for the purposes of the requirements of practice and law.

As alluded to above, the need to disclose a defence in the required manner is the most pivotal of the three requirements of Green –v- Green (supra). I am satisfied that the discloser of facts in the affidavit of Mr. Poole is, in the circumstance, quite adequate for the purposes of this 3rd requirement.

Consequently I must, in the circumstances, exercise my discretion in favor of the applicant and I would likewise grant the orders sought.

Further, for reasons already given above in relation to the issue of whether there is a reasonable explanation for allowing ex parte judgment to be entered in the first place, I must order that the applicant /defendant pay the respondent /complainant’s costs, firstly for obtaining the ex parte order and secondly, the costs incurred in the course of this application. The same are to be taxed if not agreed to between the parties.

Dowa Lawyers: Applicant /Complainant
Warner Shand: Respondent /Defendant