Rundle v Motor Vehicles Insurance (PNG) Trust (No 1) [1988] PGLawRp 7; [1988] PNGLR 20 (4 March 1988)

Papua New Guinea Law Reports - 1988-89

[1988] PNGLR 20 - Graham Rundle v MVIT (No 1)

[1988] PNGLR 20

SC347

PAPUA NEW GUINEA

[SUPREME COURT OF JUSTICE]

GRAHAM RUNDLE

V

MOTOR VEHICLES INSURANCE (PNG) TRUST NO (1)

Waigani

Kidu CJ Bredmeyer Amet JJ

24-25 August 1987

4 March 1988

PRACTICE - Notice of action - Extension of time for - Personal injuries - Motor vehicle accident - Damages claim - Notice to Motor Vehicles Insurance (PNG) Trust - Application for extension of time - To whom and how made - Extension within discretion of court - Exercise of discretion - Motor Vehicles (Third Party Insurance) Act (Ch No 295), s 54(1), (6).

LIMITATIONS OF ACTIONS - Actions for things done under statutes etc - Notice of intended claim - Personal injuries - Motor vehicle accident - Damages claim - Notice to Motor Vehicles Insurance (PNG) Trust - Application for extension of time - To whom and how made - Extension within discretion of court - Exercise of discretion - Motor Vehicles (Third Party Insurance) Act (Ch No 295), s 54(1), (6).

The Motor Vehicles (Third Party Insurance) Act (Ch No 295), s 54(1), provides that any claim for damages in respect of bodily injury arising out of the use of a motor vehicle shall be made against the trust and “any proceedings to enforce any such claim” shall be taken against the Trust. Section 54(6) provides that no action to enforce any claim lies against the Trust:

“unless notice of intention to make a claim is given by the claimant to the Trust within a period of six months after the occurrence out of which the claim arose, or within such further period as:

(a)      the Commissioner; or

(b)      the court before which the action is instituted, on sufficient cause being shown allows.”

Held

On a proper construction of s 54: (1) Notice of intention to make a claim is mandatory.

N1>(2)      (By Amet J, Kidu CJ agreeing; Bredmeyer J contra) Notice of intention to make a claim is a condition precedent to the institution or commencement of any “action to enforce any claim”; s 54(6)(b) should be read as if the words “to be” were inserted, so as to read “by the court before which the action is [to be] instituted”.

N1>(3)      (Bredmeyer J not deciding) The issuing and serving of a writ of summons cannot be deemed to be sufficient notice of intention to make a claim for the purposes of s 54.

N1>(4)      A claimant making an application for extension of time in which to give notice of intention to make a claim pursuant to s 54(6) is not put to an election: he may apply once only to the Commissioner or to the court; if an application to the Commissioner fails or is granted and not complied with, a further application may only be made to the court; if an application to the court is refused the only second chance is an appeal to the Supreme Court.

Rundle v Motor Vehicles Insurance (PNG) Trust [1986] PNGLR 181, affirmed.

Rundle v Motor Vehicles Insurance (PNG) Trust [1987] PNGLR 44, affirmed.

N1>(5)      The power of the court under s 54(6) to grant an extension of time in which to give notice of intention to make a claim is a discretionary one to be exercised according to proper principles and taking into account all the circumstances of the case.

Rundle v Motor Vehicles Insurance (PNG) Trust [1987] PNGLR 44, affirmed.

N1>(6)      On appeal from a decision of Kapi Dep CJ refusing an extension of time in which to give notice of a claim because of delay in making the application and failure of the lawyers for the claimant to comply with an order of the Commissioner, there had been demonstrated sufficient error of fact and an overemphasis on that error such as to have influenced the exercise of discretion of the judge and the appeal should be allowed and an extension of time in which to give notice of the intended claim should be granted.

Cases Cited

Lands, Minister for v Frame [1980] PNGLR 433.

Poti Hiringe v Motor Vehicles Insurance (PNG) Trust (unreported, 16 April 1987, Amet J).

Rundle v Motor Vehicles Insurance (PNG) Trust [1986] PNGLR 181.

Rundle v Motor Vehicles Insurance (PNG) Trust [1987] PNGLR 44.

Appeals

These were two appeals from decisions of Kapi Dep CJ which are reported at [1986] PNGLR 181 and [1987] PNGLR 44, relating to the refusal to grant an extension of time in which to give notice of intention to make a claim against the respondent under the Motor Vehicles (Third Party) Insurance Act (Ch No 295), s 54(6).

Counsel

T Molloy, for the appellant.

D Ryan, for the respondent.

Cur adv vult

24 March 1988

KIDU CJ: I have had the benefit of reading the judgment of Amet J with which I agree. I have nothing further to add. I would reserve the questions of costs.

BREDMEYER J: These appeals are from two decisions of Kapi Dep CJ in the same cause (see [1986] PNGLR 181 and [1987] PNGLR 44). They involve the interpretation of s 54(6) of the Motor Vehicles (Third Party Insurance) Act (Ch No 295). In order to see subs (6) in its cotext I also quote subs (1).

N2>“54.    Claims for Damages

(1)      Subject to Subsection (2), any claim for damages in respect of the death of or bodily injury to any person caused by, or arising out of the use of:

(a)      a motor vehicle insured under this Act; or

(b)      an uninsured motor vehicle in a public street; or

(c)      a motor vehicle on a public street where the identity of the motor vehicle cannot after due inquiry and search be established,

shall be made against the Trust and not against the owner or driver of the motor vehicle and, subject to Subsection (5), any proceedings to enforce any such claim for damages shall be taken against the Trust and not against the owner or driver of the motor vehicle.

...

(6)      No action to enforce any claim under this section lies against the Trust unless notice of intention to make a claim is given by the claimant to the Trust within a period of six months after the occurrence out of which the claim arose, or within such further period as:

(a)      the Commissioner; or

(b)      the court before which the action is instituted,

on sufficient cause being shown, allows.”

The facts which give rise to these appeals are as follows: The plaintiff Rundle was injured in a motor vehicle accident at Goroka on 14 September 1981. He failed to give notice of intention to claim against the Trust within the six months period prescribed by s 54(6). He applied to the Insurance Commissioner under subs (6) for an extension of time and by a letter dated 5 October 1983 was granted a 28 day extension. That extension expired on 2 November. His lawyers failed to give the notice within that 28 day period but on 3 November they issued a writ and served it on the Trust the same day. The endorsement on the writ was brief — that the “plaintiff’s claim is for damages for the negligence of the driver of a motor vehicle on the Highlands Highway at Goroka on or about 14 September 1981 wherein the plaintiff suffered personal injury”. It gave no registration details of the vehicle or vehicles concerned nor details of the driver(s) or owner(s) concerned.

On 10 February 1984 the plaintiff served a statement of claim on the defendant which gave details of the accident. It said the plaintiff was sitting in the driver’s seat of a Mazda RX4 vehicle and he was being towed by a Toyota Utility owned by Asaro Motors and driven by a Papuan. It said the Papuan man drove negligently causing the plaintiff’s Mazda to roll off the road thereby injuring the plaintiff. The statement of claim did not give the registration number of either vehicle, the owner of the Mazda, or the name of the Papuan driver of the utility.

On 11 April 1984 the defendant served a defence on the plaintiff and pleaded that no action could be taken to enforce the claim because no notice of intention to claim had been given under s 54(6). On 22 May, two months after getting the defence, the plaintiff’s lawyers applied to the Insurance Commissioner for a further extension of time. On 23 August the Commissioner granted a further 28 day extension under s 54(6). Incredibly no notice under s 54(6) was given within that second 28 day period although during that period, on 10 September, the plaintiff’s lawyer sent a copy of the Commissioner’s letter of 23 August granting the extension, to the defendant’s lawyer.

About a year later, 21 August 1986, the action came on for trial and the defendant raised a preliminary point that the action was incompetent as the plaintiff had failed to give notice under s 54(6). Kapi Dep CJ, reserved on the point and on 11 December 1986 ruled that the Commissioner had no power to give a second extension under subs (6). He left open the question of whether the plaintiff in this case could then apply to the National Court for an extension.

On 19 March 1987 the plaintiff sought from the court by way of originating summons an extension of time to give notice under s 54(6). In a judgment dated 29 April, Kapi Dep CJ ruled that a person who had failed to gain an extension from the Commissioner, or one who had gained an extension from the Commissioner but failed to give his notice within the extended period (as the plaintiff in this case), could make a second application to the court. Whether the court granted the extension or not lay in its discretion, and upon reviewing all the circumstances in this case, he refused the extension. As I have said, the plaintiff has appealed against both decisions.

Clearly when any claim for damages is made against the Trust it needs to know the driver and owner of the vehicle concerned and whether the vehicle is insured. The claimant’s knowledge of these details may be non-existent or incomplete and the Trust will need to make its own inquiries. The Trust needs to know the name of the driver so that it can get a statement from him following which it may deny liability because the driver was not negligent or because of the defence of volenti non fit injuria, or it may claim a reduction in damages because of the claimant’s contributory negligence. The Trust needs to know if the vehicle is insured because, if uninsured, it can recover the damages it pays against the driver and/or the owner: see s 57.

The purpose of s 54(6) is to give the Trust early notification of the claim so that it can make its inquiries. Obviously inquiries as to the driver, the owner, and the insurance details of a vehicle, become more difficult as time passes. Drivers change addresses and sometimes in Papua New Guinea their names, witnesses disappear, expatriates leave Papua New Guinea, and police accident reports and insurance certificates get lost. An injured person must issue his writ within three years. Section 54(6) is designed to give the Trust prior notice of the claim within six months.

I make two preliminary observations on s 54(6). First, the section makes a notice of intention to claim mandatory:

“No action to enforce any claim under this section lies against the Trust unless notice of intention to claim is given by the claimant to the Trust.”

It should normally be given before the issue of the writ but I consider that it can be given afterwards. Section 54(5) supports the latter point: “(b) the court before which the action is instituted” seems to allude to the fact that the action has already been instituted. The second point I make is that a notice under s 54(6) is different from a writ of summons. A notice under s 54(6) is a notice to the Trust of an intention to claim; the writ of summons is the claim itself. The two are different although they normally provide the Trust with the same information including: the date and place of the accident, the name of the driver and owner, and the registration number of the vehicle from which its insurance status can be ascertained. That is a very important point to note because, if perchance the writ precedes the s 54(6) notice, the latter notice has very little importance because upon receipt of the writ the Trust would begin its inquiries. If, for example, a writ was issued within six months of an accident giving, as it does, details of the vehicle, the driver and the plaintiff, but the plaintiff forgot about the s 54(6) notice until six months later, I think the Commissioner and the court would readily grant the extension because the Trust would not be prejudiced. The information contained in the notice of intention to claim was already known to the Trust when the writ was served on it.

Turning to the more contentious interpretation of the subsection, I agree with Kapi Dep CJ that this is one of those cases, as in Minister for Lands v Frame [1980] PNGLR 433 at 462 and 488, where it is proper and helpful to refer to Hansard. Julius Chan, the Minister for Finance introduced an amendment to allow the Insurance Commissioner to extend time. He said:

“Mr Speaker, another amendment proposed is to allow the Insurance Commissioner discretion to allow the late report of claims before it becomes necessary to apply to the court for enforcement of late claims as this procedure is time consuming and would only contribute to delays in claims settlement. (Including misuse.)”

I believe that the cases quoted to us from elsewhere are not particularly helpful as our section is different. I believe that our task is to give this section a sensible interpretation, doing our best to give effect to the intention of Parliament. I agree entirely with Kapi Dep CJ that a claimant is not put to an election. He can claim an extension from the Commissioner and, if that fails, he can claim an extension from the court. If he gets an extension from the Commissioner but fails to give notice within that extended period, he may apply to the court. I agree with the learned judge too that a claimant can only apply once to the Commissioner. He cannot apply a second time as he did in this case. Any second application must be made to the court. Most applicants for extension would apply to the Commissioner first. It is a simple procedure and it is what the Finance Minister and Parliament intended. It has the advantage that the applicant then has a second chance of applying to the court. If, however, an applicant applied to the court for an extension first and was refused, I would not allow a second application to the Commissioner. If the applicant fails to get an extension from the court, his only second chance is to appeal to the Supreme Court.

Applying that interpretation to the facts of this case the second application to the Commissioner was wrong and his granting of the second extension was beyond his power. The salient facts and the key dates are as follows. The accident happened on 14 September 1981. On 5 October 1983 the Commissioner gave a 28 day extension which expired on 2 November. On 3 November the writ was issued. On 10 February 1984 a statement of claim was served on the Trust giving details of the vehicle and persons involved in the accident. On 11 December 1986 Kapi Dep CJ ruled that the Commissioner’s second extension was invalid but left open for further argument the possibility of an application to the court for an extension. On 19 March 1987 the plaintiff applied to the court for an extension, and on 29 April Kapi Dep CJ held he had power to grant an extension but, in the exercise of his discretion, refused the extension.

It is quite clear that the court’s discretion to grant an extension under s 54(6), like any other judicial discretion, must be exercised according to proper principles and taking into account all the circumstances of the case. If the trial judge took into account an irrelevant matter, or failed to take into account a relevant matter, then his discretion might be overturned on appeal. The learned trial judge in refusing an extension took into account three matters, one in favour of the plaintiff and two against him. The first matter was this: the learned trial judge said that the delay in giving the s 54(6) notice between 14 September 1981 and 2 November 1983 was reasonable. The plaintiff was a New Zealander. Immediately after his accident he went to New Zealand and Sydney for treatment. His doctor said his condition would need another 12 months to stabilise. He first saw a lawyer in July 1982 in Sydney. That lawyer was unaware of the need to give an early notice to the Trust. He was ignorant of our statute and a similar requirement under New South Wales law had been repealed. Eventually the Sydney lawyer contacted a Port Moresby firm and was advised of the need for the notice. Kapi Dep CJ said the Insurance Commissioner exercised his discretion correctly in granting the 28 day extension on 5 October 1983 which expired on 2 November 1983.

The second matter that influenced the trial judge was that he thought the plaintiff’s lawyers had no good excuse for failing to give the notice within the extended period of “20” days. Twice at that point in his judgment the trial judge refers to failure to give the notice within “20” days. The reference to “20” days is clearly a slip as the period granted was 28 days as the judge correctly noted earlier in his judgment. I do not think that slip important, the important point is that the trial judge thought that the lawyer’s excuse — pressure of other work — was not a good one.

The third matter that exercised the learned judge’s discretion is contained in the last paragraph:

“It is also clear from the facts that the need to apply promptly to the court for an extension of time arose at the date when I gave judgment on 21 August 1986. There has been a period of about seven months before this application was filed in court. No satisfactory explanation has been given for the long delay in applying for the extension to the court.”

This passage contains a mistake of fact which, unlike the other slip mentioned, is of some significance. The first case was argued on 21 August but judgment was not delivered until 11 December. Clearly the plaintiff cannot be penalised while he was waiting for the court’s ruling. So the delay between the court’s ruling and the application to the court in March 1987 was three months and not seven months. Would the learned trial judge have come to the same conclusion if he realised that that delay was three months and not seven?

I consider that the trial judge failed to consider two relevant matters: the significance of the issue of the writ and the question of possible prejudice to the defendant. The two matters are intertwined and can be dealt with together. As I have said earlier, the issue and service of a writ notifies the Trust of the claim. The Trust begins its inquiries, it instructs its lawyers, a defence is filed, and letters seeking information are exchanged with the plaintiff’s lawyers. All this was done in this case. The issue of the writ makes the later notice under s 54(6) of little significance; it makes the later notice a formality because the Trust already has the information which is going to be given in the notice. The Trust is not prejudiced by a late notice, involving as it does an application for extension of time, if it has already been served with the writ. So in this case, in considering whether to grant an extension of time requested in March 1987, a very important factor to note is that the writ was issued and served on 3 November 1983. The writ in this case happened to contain few particulars but they were amplified in the statement of claim served in April 1984.

I consider that the trial judge failed to take into account these two matters and thereby erred. The three month delay between his judgment of December 1986 and the application to court for an extension of March 1987 is of no significance to the Trust because the Trust already knew of the claim when the writ was served in November 1983.

The learned trial judge thought that the first extension by the Commissioner was correctly granted, in other words that the plaintiff’s delay between 14 March 1982 (six months after the accident) and 2 November 1983 was excusable. It seems an enormous gap between 2 November 1983 and 19 March 1987 when the application to the court for an extension was made, but the fact that the writ was issued and served on 3 November 1983 notifying the Trust of the claim, means that the Trust was not prejudiced by that further delay of over three years. Section 54(6) requires a notice of intention to claim; it can be given by letter. Let me suppose that notice was given by letter on 3 November, one day out of time, the Trust objected, and the plaintiff sought a court extension, that extension would readily have been granted. If the delay between 14 March 1982 (six months after the accident when the notice should have been given) and 2 November 1983 is excusable, a period of one year, seven months, 19 days, then a delay of one year, seven months, 20 days could not be inexcusable. In the exercise of a discretion, considering a period of one year seven months, one day is not significant. It is rather like reviewing on appeal a sentence of one year seven months imprisonment; the appeal court would not alter that sentence if it though it a week too long. According to the Commissioner’s decision which was said to be correct by the trial judge, the plaintiff was allowed to give a s 54(6) notice by 2 November 1983. He did not do so, but he gave the same information in the form of the writ the next day. The Trust was not prejudiced by this wrong form of a notice, a writ instead of a letter, nor by a delay of one day added onto a permitted delay of one year, seven months and 19 days. It was also not prejudiced by an application to the court for an extension made over three years later. The application should have been treated in the circumstances as a formality and have been granted without hesitation.

I uphold appeal No 16 of 1987 and allow the plaintiff an extension of 14 days to give notice of intention to claim to the Trust under s 54(6) of the Act. I would dismiss Appeal No 57 of 1986 against the first ruling of Kapi Dep CJ. I reserve the questions of cost.

AMET J: These are two appeals from two decisions of Kapi Dep CJ on 11 December 1986 and 29 April 1987, involving the same parties and cause of action (see [1986] PNGLR 181; [1987] PNGLR 44). Same counsel were brief in the two appeals and so it was convenient that they were argued together.

It is convenient to set out the chronology of the facts and dates giving rise to the two appeals:

N1>1.       14 September 1981. The plaintiff Rundle who was employed by Collins & Leahy in Goroka, was injured in a motor vehicle accident near Goroka. A week or so later he was evacuated from Goroka Base Hospital to Cairns Hospital in Queensland as his condition deteriorated. He remained in Cairns Hospital for about three weeks.

N1>2.       Mid-October 1981. He was discharged from Cairns Hospital. He was still weak and on crutches. He travelled to Auckland, New Zealand and lived with his mother. Over the next few months he recuperated in Auckland.

N1>3.       January/February 1982. He was informed in New Zealand by Collins & Leahy that his job was no longer available to him. In February he travelled to Goroka to get his belongings. He returned to Sydney, Australia.

N1>4.       July 1982. He obtained employment in Sydney. He then approached solicitors about a claim for compensation. Earlier in New Zealand, he had been advised to hold off for about a year until his condition had stabilised.

N1>5.       November 1982. He had not received any satisfactory advice from the solicitors so changed instructions to another firm of solicitors.

N1>6.       June 1983. The firm of Kirkes — lawyers were instructed by the Sydney solicitors of the applicant.

N1>7.       8 July 1983. Kirkes lawyers applied to the Insurance Commissioner for extension of time, pursuant to s 54(6), to serve notice of intention to make a claim to the Motor Vehicles Insurance (PNG) Trust.

N1>8.       5 October 1983. The Insurance Commissioner granted an extension of 28 days within which to serve notice of intention to make a claim against the Trust.

Kirkes lawyers failed to serve notice within the 28 days.

N1>9.       3 November 1983. Kirkes lawyers issued a writ of summons out of the National Court against the Trust and served it on the Trust on the same day.

N1>10.     10 February 1984. The plaintiff served a statement of claim on the defendant.

N1>11.     11 April 1984. The defendant served a defence on the plaintiff and pleaded that the plaintiff could not take action to enforce the claim because he had not complied with s 54(6) in that no notice of intention was served upon the defendant.

N1>12.     22 May 1984. Kirkes advised the Insurance Commissioner that regrettably the writ of summons was not filed until 3 November 1983 which was outside the time limit, and requested that authority be given under s 54(6) for the claim to be lodged by 15 November 1983. In support it was advised that the Insurance Commissioner’s letter of 5 October 1983 granting the 28 day extension was not received until the 11 October 1983.

N1>13.     23 August 1984. The Insurance Commissioner granted a second extension of 28 days. No notice was in fact given after this extension of time.

N1>14.     10 September 1984. The plaintiff enclosed to lawyers for the defendant the letter from the Insurance Commissioner of 23 August 1983 granting the 28 day extension to serve notice of intention to make a claim.

The suit came to trial before Kapi Dep CJ, on 21 August 1986. The defendant raised the preliminary objection that the action was incompetent because the plaintiff had failed to give notice of intention to make a claim under s 54(6). The plaintiff contended, however, that the writ of summons issued and served on the defendant on 3 November 1983, the delivery of pleadings and correspondence between the parties constituted sufficient notice of intention by the plaintiff that he intended to make a claim.

The learned Deputy Chief Justice did not resolve this issue but rather determined the preliminary objection on the basis that the Insurance Commissioner “had no jurisdiction or power to” grant a second extension under s 54(6). His Honour left open the next issue under s 54(6) whether, having failed to obtain an extension of time or having failed to give notice of intention within the extended time, the plaintiff could make further application for extension to the National Court under s 54(6)(b). This is the subject of SCA 16 of 1987. The plaintiff applied to his Honour on 19 March 1987 for extension. Kapi Dep CJ refused the application.

It is convenient to set out the relevant sections of the Motor Vehicles (Third Party Insurance) Act (Ch No 295) as both appeals are concerned with the interpretation to s 54(6) thereof.

N2>“54.    Claims for Damages

(1)      Subject to Subsection (2), any claim for damages in respect of the death of or bodily injury to any person caused by, or arising out of the use of:

(a)      a motor vehicle insured under this Act; or

(b)      an uninsured motor vehicle in a public street; or

(c)      a motor vehicle on a public street where the identity of the motor vehicle cannot after due inquiry and search be established,

shall be made against the Trust and not against the owner or driver of the motor vehicle and, subject to Subsection (5), any proceedings to enforce any such claim for damages shall be taken against the Trust and not against the owner or driver of the motor vehicle.

...

(6)      No action to enforce any claim under this section lies against the Trust unless notice of intention to make a claim is given by the claimant to the Trust within a period of six months after the occurrence out of which the claim arose, or within such further period as:

(a)      the Commissioner; or

(b)      the court before which the action is instituted,

on sufficient cause being shown, allows.”

SCA NO 57 OF 1986 [1987] PNGLR 181

The two main grounds of appeal were that:

N2>(a)      The learned Judge misdirected himself in construing s 54(6) of the (Act) as prohibiting the Insurance Commissioner from considering more than one application for an extension of time in which to give notice to the Trust of intention to make a claim under the Act.

N2>(b)      The learned Judge erred in holding that the appellant had made a fresh application to the Insurance Commissioner for an extension of time and in not holding that the appellant had applied for a variation of the Insurance Commissioner’s original decision to extend the time for giving notice.

Notice of intention to make a claim — s 54(6)

There are several points I wish to make about the intent of s 54(6), and I wish to refer to and highlight several phrases. These are; “action to enforce any claim” and in “(b) the court before which the action is instituted”.

The requirement to give “notice of intention to make a claim” is in mandatory terms. “No action to enforce any claim lies against the Trust unless” such a notice is first given to the Trust within six months after the occurrence out of which the claim arises. It is a condition precedent to any “action to enforce any claim”. On an examination of the other subsections of s 54 it becomes apparent that two different stages and processes are spoken of or referred to.

The first is the notice of intention to make a claim and the claim for damages made to and against the Trust as distinct from “any proceedings to enforce any such claim for damages” or “action to enforce any claim” which is to be instituted before a court. We find the distinction in subs (1):

“any claim for damages ... shall be made against the Trust ... and, subject to Subsection (5), any proceedings to enforce any such claim for damages shall be taken against the Trust ...”

In subs (3) the distinction is also made:

“A claim under subsection (1)(a) or (b) may be made, and any proceedings to enforce such a claim may be taken ....”

In subs (5) this expression is found:

“Where an award of damages is made by a court in respect of a claim under Subsection (1) ....”

Then, of course in subs (6) similar expressions are used:

“No action to enforce any claim ... unless notice of intention to make a claim ....”

The point to be made, in my view, is that,

consistently with similar expressions used in the other subsections, the words “action to enforce any claim” used in subs (6) refer to and mean “proceedings to enforce any claim” in a court. This might seem trite, but it is important, I believe, to establish it sufficiently. If we interpose this expression in the place of “action to enforce any claim” in subs (6) then it would read like this:

“No ‘proceedings to enforce any claim under this section in a court’ lies against the Trust unless notice of intention to make a claim is given ... etc.”

If this be the meaning of subs (6), and it is a mandatory condition precedent before any court proceedings to enforce any claim can lie against the Trust, then I consider par (b) is inconsistent with it. To use the words or par (b) itself, if no action can be instituted in a court to enforce any claim unless notice is given, how can application be made, for an extension of time to give such notice of intention to make a claim, to “the court before which the action is instituted?” In my opinion that is non sequitur. No court action to enforce lies, can commence or can be instituted unless the condition precedent of the notice of intention has first been given to the Trust. I believe subs (b) has been poorly drafted. If it is to be construed the way it is presently worded, it would require, as a condition precedent to making application to the court, that the action should first be instituted. That is “the court before which the action is instituted”. This surely does not make sense. One of the purposes for giving early notice must be to enable parties to make enquiries before any further action or proceedings are considered. If subs (b) is construed as it is drafted, to require the action to have been instituted before any application for extension of time to give notice can be made, then it defeats the whole purpose of the need to give notice.

In my opinion, to render par (b) consistent with the plain meaning of the body of subs (6) as I have interpreted it, the words “to be” should be read in after “the action is” and before “instituted”, to read:

N2>“(b)    the court before which the action is to be instituted.”

This surely makes a whole lot more sense, that no court action or proceedings can be instituted to enforce any claim unless notice of intention to make such a claim has first been given to the Trust.

The issuing of the writ of summons on 3 November 1983 is, in my view, institution of an action to enforce the claim, or commencement of proceedings to enforce or action to enforce the claim. It is not the “notice of intention to make a claim” required to be given under s 54(6).

Returning to the specific ground of appeal (a), I too agree with Kapi Dep CJ that the applicant is not put to an election between applying to the Insurance Commissioner or to the court. He has the right to choose which of them he should first make application to. If he should choose first to make application to the Insurance Commissioner, which would be easier and less time consuming, he retains the right to make further application to the court should that become necessary. This is the clear intention and the purpose of the amendment as can be deduced from the introduction of the amendment by Julius Chan, as he then was. He said:

“Mr Speaker, another amendment proposed is to allow the Insurance Commissioner discretion to allow the late report of claims before it becomes necessary to apply to the court for enforcement of late claims as this procedure is time consuming and would only contribute to delays in claims settlement.”

The application to the Commissioner was intended to be easier, not so difficult and less time consuming than the longer more complex application necessary before a court with all the attendant legal formalities. One would expect therefore that an applicant would choose first to apply to the Commissioner. I do not believe that the other alternative was the intention of the proposer of the amendment nor the legislature, that if an applicant should choose to make the harder, more formal application to a court, he should be permitted to re-apply in a less formal and easier method to the Insurance Commissioner. If an applicant should first make application to the court, and was granted an extension but failed to give notice within the extended time, for whatever reason, he cannot re-apply to the Commissioner. If the application was refused by the court, he cannot re-apply to the Commissioner.

I agree that if the applicant should choose to apply first to the Commissioner, and the application is refused, he can apply to the court. If the application is granted by the Commissioner, and the applicant failed to give notice, for whatever reason, he is not precluded from applying afresh to the court. I did hold in Poti Hirings v Motor Vehicles Insurance (PNG) Trust (unreported, 16 April 1987, Amet J) that in this latter circumstance the applicant may not apply to the court. I have reconsidered that opinion and am now of the view that such an applicant may apply to the court. That is a statutory right which cannot be defeated by circumstances. However, one can imagine that an applicant who was granted an extension but through neglect failed to give notice within the extended time would have a much harder row to hoe than an applicant who is applying to the court for the first time or who had been refused an extension by the Commissioner.

Consistently with the reasons for the amendment and the alternatives above, I do not consider that it was the intention of the proposer nor of Parliament that the applicant who applies to the Commissioner and is refused or who is granted an extension but fails to give notice within the extended time, should be permitted to apply more than once to the Commissioner. His recourse is clearly to a higher tribunal, and this is permitted to be a fresh application to the court. The same rationale applies in respect of the applicant who applies to the court, if he is aggrieved, by being refused his application or simply fails to give notice within time extended, he cannot re-apply to the same court. He has the right to appeal to or review by a higher court. In this instance the first court being the National Court, the review/appeal lies to this court as in these appeals. This ground of appeal therefore fails.

The ground (b) is based on a wrong premise. Kirkes, the lawyers for the applicant clearly, by their letter of 22 May 1984 to the Insurance Commissioner considered the writ of summons filed and served on 3 November 1983, to be the notice referred to in s 54(6). I am of the view that the writ of summons cannot be deemed to be that notice. It is in my opinion the commencement of action to enforce or proceedings to enforce the claim or the institution of action to enforce the claim which is not permitted “unless notice of intention to make a claim” has been given to the Trust. The writ was considered by the plaintiff to be the notice until the defendant alerted him to the fact that it was not the notice and was in fact served after the expiry of the extended time of 28 days, by pleading this objection in the defence filed 10 March 1984. It was not until 22 May 1984, that the plaintiff sought approval from the Commissioner to give notice retrospectively to on or before 15 November 1983, presumably to give retrospective validity to the writ of summons filed on 3 November 1983. This application, the plaintiff has submitted, was for a variation of the approval granted on 5 October 1983.

In my opinion, that writ was not the notice envisaged by s 54(6), and even if the plaintiffs application of 22 May 1984 can be deemed an application for variation, any approval could not validate the writ as the notice. In any event what is more important is, that the Commissioner granted the second extension of 28 days on 23 August 1984 to run from that date and not retrospective to extend from 2 to 15 November 1983. No notice of any kind was served on the Trust within the further extended time. In these circumstances I cannot agree that the service of the writ plus the statement of facts should be deemed sufficient notice.

SCA NO 16 OF 1987

This appeal takes issue with the learned Deputy Chief Justice’s exercise of his discretion in refusing to extend the time within which to give notice. It was first contended by the appellant that the learned judge had made an error of fact when he said the appellant had not acted promptly in applying to the court for the extension when the opportunity to do so first arose when his Honour gave judgment “on the 21st August, 1986”.

The learned judge made two references to his judgment as having been given on 21 August 1986. At the outset of the judgment when he said:

“the circumstances under which that issue was considered are contained in my judgment dated 21 August 1986 N578.”

and at the conclusion when he said:

“It is also clear from the facts that the need to apply promptly to the court for an extension of time arose at the date when I gave my judgment on 21 August 1986. There has been a period of about seven months before this application was filed in court. No satisfactory explanation has been given for the long delay in applying for this extension to the court.”

The learned Judge did mistake the date on which he delivered judgment. It was not 21 August 1986 but in fact 11 December 1986. The 21 August 1986 was the date of the trial. His Honour thus erred further in concluding from this error of fact that, “there has been a period of about seven months before this application was filed in court”.

And indeed a close examination of the original file and documents in the application, OS 20 of 1987, it is found that the originating summons seeking the extension of time was in fact filed on 18 February 1987. It was heard by his Honour on 19 March 1987. These corrections of the facts put a markedly different complexion on the time span from the original judgment to the application to the court. And so from 11 December 1986 to 18 February 1987 is now two months, one week, and not seven months from 21 August 1986 to 19 March 1987.

The argument for the appellant to be given leave to give notice is stronger still in my view, because the two months, one week is further reduced by the court vacation period. Order 2, r 3 of the National Court Rules provides for the vacation period “each year from 20 December to the following 31 January”. Subrule (3) provides that:

“The time for the vacation shall not be reckoned in the times appointed or allowed by these Rules for filing, delivering or amending any pleading unless so directed by a Judge, nor shall a pleading be delivered or amended, nor judgment be entered in default, unless under the direction of a Judge.”

Though there was no specific time limit within which to commence the application the vacation period should not be held as running against the appellant. If the period 20 December 1986 to 31 January 1987 is not held against the appellant, the two months, one week, is reduced further by that period to a mere 27 days, one day short of four weeks being nine days from 11 to 20 December 1986 and 18 days from 1 to 18 February 1987.

In these circumstances, I uphold this ground of appeal. The matter of the period between his judgment and the application to the court for extension was a significant factor in the judge’s decision to refuse the application.

The next ground relied upon by the appellant was that the trial judge again erred in fact by mistaking the two periods of extension by the Commissioner as 20 days whereas they were in fact for 28 days. Once again the documents do disclose that the trial judge erred in this respect. However, I do not consider it affected the exercise of his discretion. In respect of the first extension from 5 October 1983, the appellant had taken the view that the issue of the writ of summons on 3 November 1983, though one day after expiry of the extension, was service of notice and he made application to further extend the time retrospectively to validate the writ as being served within time. The issue of the writ of summons was not sufficient notice within the terms of s 54(6).

The appellant was granted a second extension by the Commissioner on 23 August 1984, after protracted correspondence, to run from 23 August 1984 for 28 days. No notice was given after this extension, the appellant taking the view that the writ of summons of 3 November 1983 was sufficient notice.

I agree with Kapi Dep CJ that it is inexcusable that lawyers for the appellant had allowed the extended time to have expired the first time and also within the period extended the second time. It became evident that the lawyers for the plaintiff took the view that the writ taken out on 3 November 1986 was notice and so made no further effort to give notice within the second extension.

In all the circumstances, however, I consider that there has been demonstrated sufficient error of fact and an overemphasis on that error to have influenced the exercise of discretion against grant of extension. I would therefore dismiss appeal No 57 of 1986 against the first ruling of Kapi Dep CJ, but uphold Appeal No 16 of 1987 against the second ruling of Kapi Dep CJ, and allow the plaintiff an extension of 14 days to give notice of intention to make a claim to the Trust under s 54(6) of the Act.

The question of costs shall be reserved.

ORDERS

N1>1.       Appeal No SC 16 of 1987 upheld and the plaintiff allowed 14 days to give notice of intention to claim to the Trust under s 54(6) of the Act.

N1>2.       Appeal No SC 57 of 1986 is dismissed.

N1>3.       Question of costs reserved.

Orders accordingly

Lawyer for the appellant: Kirkes.

Lawyer for the respondent: Young & Williams.