Polling v Motor Vehicles Insurance (PNG) Trust [1986] PGNC 47; [1986] PNGLR 228; N564 (20 October 1986)

N564

PAPUA NEW GUINEA
[NATIONAL COURT OF JUSTICE]

ANTHONY JOHN POLLING

V

MOTOR VEHICLES INSURANCE (PNG) TRUST

AND

BOWMANS BOUGAINVILLE PTY LTD

AND

BOUGAINVILLE DEVELOPMENT CORPORATION LIMITED

Waigani
Wilson J
17 October 1986
20 October 1986

PRACTICE - Effect of non-compliance with rules - Power to dispense with strict compliance - When appropriate - Relevant considerations - Interests of justice - Impact on fights of parties - Amended statement of claim served on added defendant - Writ of summons not served - National Court Rules, O 1, rr 7, 8, 9.

PRACTICE - Service - Service of amended originating process - Time for - Time runs from amendment - Statement of claim - Amendment to add name of defendants - Service within two years of amendment - National Court Rules, O 4, r 13, O 5, r 11(3).

In proceedings seeking damages for personal injuries arising out of the use of a motor vehicle the plaintiff sought and obtained leave to add the names of the second and third defendants as defendants to the writ of summons. The plaintiff then filed and served the statement of claim including the names of the second and third defendants (but not a writ of summons) on those defendants. The third defendant having failed to enter a defence, judgment by default against it was entered and some ten months later (fifteen months after service of the statement of claim) the third defendant gave notice of intention to defend and then sought orders setting aside the default judgment and dismissing the plaintiffs claim because of the following, inter alia, alleged irregularities:

(a) the serving of the statement of claim outside the period of two years prescribed by the National Court Rules, O 4, r 13, and

(b) the failure to serve a writ of summons.

Held

(1) As the two year period prescribed by O 4, r 13, in which an amended statement of claim or other amended originating process must be served, by virtue of O 5, r 11(3), commences to run at the time when the originating process as amended is filed, the amended statement of claim had been served within time.

(2) As the National Court Rules are only a code of practice, the court has power either inherent, or deriving from O 1, rr 7, 8 and 9, in a particular case, to dispense with strict compliance with the Rules.

Morres v Papuan Rubber and Trading Co Ltd [1914] NSWStRp 21; (1914) 14 SR (NSW) 141 at 143-144, considered.

(3) On an application to dispense with strict compliance with the Rules regard should be had, inter alia, to the interests of justice and the impact of the non-compliance on the parties with relevance to whether in reality the other party is in as good a position as if the rules had been complied with, or whether the party has been disadvantaged in regard to its rights in the matter.

(4) In the circumstances the application had not been made within "a reasonable time" as required by O 1, r 9, and should be rejected.

(5) In the circumstances the judgment by default should be set aside to enable the third defendant to defend the proceedings.

Cases Cited

Morres v Papuan Rubber and Trading Co Ltd [1914] NSWStRp 21; (1914) 14 SR (NSW) 141; (1914) 31 WN (NSW) 63.

Notice of Motion

This was an application by way of notice of motion seeking to set aside a default judgment and for an order dismissing the plaintiffs claim because of alleged irregularities in the proceedings.

Counsel

P Bolam, for the plaintiff/respondent.
M Hirst, for the third defendant/applicant.
Cur adv vult

20 October 1986

WILSON J: This is an application by the third defendant by way of amended notice of motion filed on 17 October for orders setting aside a default judgment dated 8 October 1985 and for an order dismissing the plaintiffs claim due to irregularity of the proceedings.

A brief chronology of events in these proceedings is as follows:

Accident 28.05.79
Writ of summons Issued 11.01.83
Order granting leave to join second and third defendant Entered 22.06.84
Statement of claim Filed 22.06.84
Statement of claim served on second defendant 25.06.84
Statement of claim served on third defendant 09.07.85
Default judgment entered against second defendant 12.09.85
Default judgment entered against third defendant 08.10.85
Default judgment delivered to third defendant 30.12.85
Notice of intention to defend by third defendant Filed 07.08.86
Third defendant’s notice of motion Filed 22.09.86
Third defendant’s amended notice of motion Filed 17.10.86

In respect to this chronology the following detail and comment is necessary. The order granting leave to join the second defendant and third defendants was in these terms:

"Leave is hereby granted to join as defendants in this action Bowmans Bougainville Pty Ltd and Bougainville Development Corporation Ltd by adding their names as Second and Third Defendants respectively to the Writ of Summons herein." (My emphasis.)

The third defendant makes two objections in respect of action following this order. First, it is submitted that the plaintiff did not comply with the National Court Rules, O 8, r 54, by amending within fourteen days, there being no time specified in the order. Since the plaintiff took out the order on 22 June and filed a statement of claim that same day action was taken within fourteen days. To the extent that this is relevant to the issue before me I am of the view that there was no breach of O 8, r 54.

Secondly, and more importantly for the purpose of this application, the third defendant says that no writ of summons was served on it only, the statement of claim. In essence the submission is that since no originating summons was served no judgment could be entered and further that should the judgment be set aside no proceedings as such are current against the third defendant. The third defendant also submits that at the time of serving the statement of claim on 9 July 1985, a period of two years had expired from the date of filing the writ of summons which was issued on 11 January 1983. See O 4, r 13. In respect of this aspect of the submission I hold that O 5, r 11 (3), sets the time, from which the two year period commences, as the time at which the originating process as amended was filed.

The essential issue to be determined in this application is whether the filing of a statement of claim including the third defendant, and subsequent service of it, should be deemed by this Court to be sufficient and effective compliance with the Rules of the National Court and the Order made by the court on 8 June 1984.

Under O 1 the definition of "originating process" for the purposes of this determination is a writ of summons or an originating summons. The plaintiffs counsel, Mr Bolam, submits that this Court should not take what one might term a technical approach and should look at all the circumstances to determine whether the third defendant has been effectively joined in these proceedings, notwithstanding the non-compliance with the order and Rules of Court.

As has been noted before the Rules of Court are a code of practice and there is no doubt that where justice so requires strict adherence to the Rules can be dispensed with in the circumstances of a particular case. See also O 1, r 7 and r 8, dealing with non-compliance.

During the course of argument I was referred by Mr Bolam, the plaintiffs counsel, to the case of Morres v Papuan Rubber and Trading Co Ltd [1914] NSWStRp 21; (1914) 14 SR (NSW) 141 at 143, 144. The judgment, although dealing with irregularity in the nature of non-compliance with rules governing appeals is useful and pertinent to the broad issue in point in this case. At 143-144 the then Chief Justice of New South Wales (Sir W P Cullen) had this to say:

"Now, I am equally satisfied that the Court has power to act, where justice requires, in the way of permitting the prosecution of an appeal notwithstanding default in compliance with the rule of serving the notice of motion upon the other side. I think that s 16 of the Supreme Court Procedure Act, No 49 of 1900, enables the Court to allow the prosecution of an appeal notwithstanding default in the service of that notice. And it is extremely desirable that the rules should not be allowed to stand in the way of serving the interests of justice. If justice requires that the severity of a rule should be relaxed, then it is of extreme importance that the Court should relax it. As was said by the Master of the Rolls in the case of Re Coles & Ravenshear ([1907] 1 KB 1 at 4), ‘Although I agree that a Court cannot conduct its business without a code of procedure, I think that the relation of rules of practice to the work of justice is intended to be that of handmaid rather than mistress, and the Court ought not to be so far bound and tied by rules, which are after all only intended as general rules of procedure, as to be compelled to do what will cause injustice in the particular case.’ But when a party, who has neglected to observe those requirements which the rules place him under for protection of the other side, comes for the indulgence of the Court to ask that the proceedings shall continue notwithstanding that default, he has to satisfy the Court that justice requires that that default of his shall be overlooked, and he must satisfy the Court that there is some reasonable kind of explanation or excuse for his neglect of the rules. If a rule is one merely regarding a matter of detail in which the other party can be placed in as good a position as if the rules had been complied with, then in regard to such matters of detail the Court ought not to be very strict, because, the main purpose to be served being the carrying out of the particular proceeding, the mere matter of detail ought not to stand in the way of that purpose being served. But where it is a matter which definitely affects the right of the party, then although the Court has full power to condone the breach of the rules, it would require to see that the object to be served is one that justice really requires under the particular circumstances."

With due deference to the learned Chief Justice I find much commonsense and fairness in those comments. In particular I adopt as criteria for guidance in such applications the interests of justice in the particular case and the proposition as to whether in reality the other party is in as good a position as if the rules had been complied with, or to put it another way, whether the party has been disadvantaged in regard to its rights in the matter.

Apart from the rules already referred to O 1, r 9, is I believe, apposite to this determination. The rule states:

"An application to set aside any proceeding for irregularity shall not be allowed unless it is made within a reasonable time, or if made after the party applying has taken any fresh step with knowledge of the irregularity."

In this matter the statement of claim was served on the third defendant on 9 July 1985 with this application being brought fifteen months later. Also, despite the fact that default judgment was entered on 8 October 1985 and delivered to the third defendant on 30 December 1985, a notice of intention to defend was filed on 7 August 1986. Both these circumstances would appear to be sufficient to bring into operation the effects of O 1, r 9.

The final matter I wish to mention in assessing this application is the effect of the service of the statement of claim on the third defendant. The statement of claim served runs to five pages and comprehensively sets out the claim of the plaintiff. Indeed it more fully sets it out than the writ of summons. I am in no doubt that the third defendant on receipt of the document would have been aware of the nature of the proceedings being brought against it. However, as Mr Hirst correctly points out, it omits advice, which is contained on the writ of summons, as to the consequences that may flow in terms of an order for judgment.

While the court should not encourage significant deviation from its orders and Rules of Court I am of the view that the error in this case was made in good faith and that in terms of the commencement of process the third defendant has not suffered injustice. I do however consider that the delay in bringing this application works against the third defendant and the filing of its notice of defence has detracted from the strength of its application.

In the circumstances of this particular case, for the reason set out above I reject the application of the third defendant to dismiss the proceedings.

In respect of the application to set aside the default judgment of 8 October 1985 I consider that fairness demands that the third defendant should be able to contest the plaintiffs claim. It is clear that there has been some confusion on the part of the third defendant regarding instructions in this matter but is clear that it contests the plaintiffs claim.

Before concluding with the orders I will make on this application I record my appreciation to both counsel for their competent and comprehensive submissions which I found to be of great assistance. In particular the provision of a typed chronology of events together with succint written submission by Mr Bolam was extremely helpful in a matter with the complexities of this case and is a practice to be encouraged amongst other lawyers in similar circumstances.

In view of the orders I now make the rights of the second defendant are also involved and the order has been termed appropriately to protect such interests.

The orders are:

1. Compliance with the order entered on 22 June 1984 and Order 5, rule 11, Order 6, rule 2, and Order 4, rule 13 of the National Court Rules be dispensed with.

2. The entry of the order granting leave to join the second and third defendants and the filing of the statement of claim both on 22 June 1984 be deemed to be the filing of originating process amended to add the second and third defendants and due compliance with the order entered on 22 June 1984 an Order 5, rule 11 of the National Court Rules.

3. Service of the statement of claim upon the second and third defendants on 25 June 1984 and 9 July 1985 respectfully be deemed valid service of originating process upon the second and third defendants.

4. Default judgment against the second defendant on 12 September 1985 and against the third defendant on 8 October 1985 be set aside with the second defendant allowed fourteen days from the service of this order to file a notice of intention to defend or in default the plaintiff may proceed to judgment.

5. There be no order as to costs.

6. Time for settling the order to be abridged to enable the order to issue forthwith.

Orders accordingly

_____________________

Lawyers for the plaintiff: Beresford Love Francis & Co.
Lawyers for the third defendant: Gadens.