Jixin Industries (PNG) Ltd v Wooden Poles Supplies Ltd [2008] PGDC 82; DC832 (29 February 2008)

DC832

PAPUPA NEW GUINEA
[IN THE DISTRICT COURT OF JUSTICE]
Civil Jurisdiction

DC N0 2198 OF 2007

JIXIN INDUSTRIES (PNG) LIMITED
Complainant

V

WOODEN POLE SUPPLIES LIMITED
1st Defendant

PETER WAWUN
2nd Defendant

PORT MORESBY: Pupaka, PM

2008: 29th February

Eviction proceedings – Summary Ejectment Act – Section 6 – Title deed – Eviction orders may otherwise issue – Pleadings raised in formal defence contradictory – Other reasons advanced unsupported by evidence and do not amount to "reasonable cause" under Section 6 (2) (b) of Act and cannot counter demand for vacant possession – Eviction orders imperative to halt continuing losses which may not be possible to recover against the defendants – In any event the defendants’ possible claims may lay in damages only.

Counsel:

Mr. Mulina for the Complainant
No appearance for the Defendants

29th February 2008

PUPAKA, PM: This matter was fixed for hearing today, possibly ex parte, in the continued absence of the defendants. Sure enough the defendants again failed to appear. Seizing the opportunity the complainant asked to be heard ex parte. In all the circumstances it is entitled to present evidence ex parte. Consequently leave was granted. As it is, the principal relief sought in this matter is an eviction order under the Summary Ejectment Act (the Act), which means the proceeding can be heard summarily. There are also assertions of continuous losses being incurred by the complainant, due directly to the lack of vacant possession of the premises, which puts this case on a more urgent footing.

THE FACTS

It goes without saying that in these ex parte hearing circumstances the accepted facts are necessarily the complainant’s version only. As to why the defendants’ version of the facts is not before the Court for purposes of comparative analysis, is a matter of the defendants’ own choice.

That said I note that the parties seem to have had a business relationship previously, whereby the complainant initially leased the property from the 1st defendant. The property is Section 349 Allotment 3, Hohola NCD, Volume 24 Folio 103. In the lease agreement there was an option for the complainant to purchase the property. Towards the end of the lease agreement the complainant exercised the purchase option. Consequently the parties’ contracted to sell /buy and conveyance thereof was finalized in 2006. A copy of the title deed is now in evidence. It shows the complainant to be the current unencumbered owner of the premises since January 2007.

The complainant’s deputy Managing Director, Alice Yang Pinxian, who has deposed to an affidavit for today’s purpose, says the defendants are continuing to occupy the premises and refuse to give up possession upon request. She says the complainant has therefore been forced to incur "extra storage costs" at the rate of K2000.00 per month and she says this has continued since from the time ownership of the premises was transferred. Alice Yang Pinxian further says that the defendants are occupying the premises without any property rights or title or licence or permission.

EVICTION PROCEEDINGS

Eviction proceedings and indeed the right to vacant possession by an owner of land is primarily a matter of law. The law is that unencumbered ownership bestows upon the owner the right to evict a person or persons who are in occupation of premises without any rights. Section 6 of the Act grants that power and it reads:

"6. Recovery of premises held without right, etc

(1) Where a person without right, title or licence is in possession of premises, the owner may make a complaint to a magistrate of a District Court to recover possession of the premises, and the magistrate may issue a summons in the prescribed form to the person in illegal occupation.

(2) Where the person summoned under Subsection (1) –

(a) does not appear before the District Court at the time named in the summons; or

(b) appears and does not show reasonable cause why possession of the premises should not be given,

the Court may, on proof of the matter of the complaint, issue a warrant directed to a member of the Police Force requiring him, on or before a day specified in the warrant –

(c) to enter, by force and with assistants if necessary, into the premises; and

(d) to give possession of the premises to the complainant."

DEFENCE STANCE

The defendants filed a formal defence to this suit by which they attempt to show that they have a lawful right to occupy the premises. They have not filed any affidavits so their reasons for pleading the defence of lawful occupation remain unsubstantiated though. The defendants have also made certain conflicting and contradictory assertions in their pleadings.

In this sort of situation, when there is clear title vested in the party seeking eviction orders but the occupier of premises insists on being allowed to remain upon the premises, the occupier must, inter alia, show "reasonable cause" that Section 6 (2) (b) of the Act speaks of. In this instance however the defendants failed to file evidence establishing any such reasonable cause.

It is asserted in the formal defence that the 1st defendant is a deregistered entity. It is also said that the 2nd defendant is a former director of the 1st defendant. I understand that, by these assertions, the defendants are saying that they cannot be sued for lack of capacity. There also may be any number of implications borne out by the pleadings. For one the complainant may not secure judgment against the defendants when it actually seeks damages that it claimed (but not progressed) in this proceeding.

In the same formal defence the 2nd defendant has asserted that he is in occupation of the premises on behalf of the 1st defendant. He refers to certain rights the 1st defendant is entitled under a "Subsidiary Agreement". Of course there is no evidence of the nature of this Subsidiary Agreement so the strength of whatever rights are available in it is uncertain.

CONSIDERATION OF THE BALANCE OF CONVENIENCE

As a matter of equity, any rights that may be invoked by a defunct entity and one of its former directors, under an unknown subsidiary agreement, cannot be a reason or an argument that is sufficient to deny the complainant vacant possession. Vacant possession is particularly imperative when it appears that expenses continued to be incurred by the complainant, as extra storage costs, can be halted by immediate vacant possession.

For the defendants’ to declare that they cannot be sued for lack of capacity, and at the same time insist that they are entitled to occupy the premises, to the obvious loss of the complainant, is both contradictory and conflicting. It bears repeating that the implications borne out by this sort of pleadings would be distressing for the complainant.

Whereas if the defendants suffered any breach or losses, whether caused or affected or created by an ex parte eviction order, they would have little difficulty in obtaining relief for damages against the complainant. It does seem the complainant is a fully capacitated entity, unlike the alleged defunct status of the 1st defendant. In any event it does seem that the defendants’ relief under any subsidiary agreement may lay in damages only and not in specific performance of that subsidiary agreement.

CONCLUSION

This matter was commenced last year (2007). The reason why an outcome has not happened in this case any earlier is mostly because the defendants’ have failed to show up in court. Moreover it does seem the defendants would know that they stand on shaky legal ground so they are presumably prepared for a quick exit, if and when they are ordered to move out of the premises. On the other hand the complainant needs to have vacant possession urgently to arrest continuation of losses it incurs in paying extra storage costs.

Ergo I must grant the eviction order sought. I order that the defendants, Wooden Pole Supplies Limited and Peter Wawun, move out of Section 349 Allotment 3, Hohola NCD, Volume 24 Folio 103, within 14 days of being served with this order. If there is no voluntary hand over of possession, the complainant is at liberty to obtain a warrant directing members of the Royal Papua New Guinea Constabulary to enter by force, with assistance if necessary, and give it vacant possession of the premises.

The complainant shall have its costs of this proceeding, the same to be taxed if not agreed to between the parties.

Finally I must note for the record that the complainant retains the right and prerogative to commence fresh proceedings in future, be it in this Court or else where, in relation to the issue of damages against the defendants. The complainant did not progress its damages claim and consequently the issue has not been determined on the merits or at all in this proceeding.

________________________________________________

Warner Shand Lawyers for the Complainant
Pacific Legal Group, lawyers for the Defendant