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National Court of Papua New Guinea |
PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]
MC NO. 6 OF 1999
BETWEEN:
ELIJAH HAROLD also known as ELIJAH COCO HARRO
Petitioner
AND:
REGINA WAIM HARRO
First Respondent
AND:
ALLAN KUNDI
Second Respondent
AND:
WHITE CORNER INVESTMENT LIMITED, REDCOCO PROPERTIES LIMITED, NOKANGE CONSULTANCY SERVICES LIMITED, GOLIKUKA BUSINESS GROUP INC. (NO.
2).
Third Respondents
Lae: Manuhu, AJ
2004: July, 20 & 21 & September 3 & 10.
RULING
DISCOVERY – Default – Seriousness of – Receiver and manager – Appointment – Authority – Necessity.
DISCOVERY – Default – Seriousness of –Striking out reply.
Cases cited:
Ok Tedi Mining Ltd v. Niugini Insurance Corporation and Ors (No. 1) [1988-89] PNGLR 355.
Re Samco Sargent Consolidated Ltd, New Zealand Growth Securities Ltd and International Commercial Management Ltd (1977) 1 BCR 112.
Counsel:
Mr. P. Ousi, for the Petitioner.
Mr. K. Kua, for the First Respondent.
Mr. D. Poka, for the Third Respondents.
10th September 2004.
MANUHU, AJ.: The substantive proceeding is a petition for divorce, custody and maintenance, and property settlement. The Petitioner and the First Respondent celebrated their marriage on 25th May 1983. There are five children of the marriage, namely, Jacinta, John Kaupa, Elijah Jr, Martha and George. Unfortunately, due to differences, as pleaded, a petition for divorce was filed on 8th February 1999. The Answer and Cross-Petition were filed on 1st September 1999. The Petitioner’s Reply was filed on or about 15th October 1999. The Third Respondent was joined as a party to the proceeding on 23rd October 2000.
A number of orders were made thereafter but the one made on 18th December 2001 is significant. By virtue of that order, the marriage was dissolved by decree nisi and custody of four children was finalized. What remains to be resolved are Martha’s custody and maintenance, and property settlement which are to be tried jointly. Relevant to these interlocutory applications is the further order, in preparation for the trial, for the parties to give discovery to each other.
The substantive proceeding was set down for trial at 9.30 am on 20th July 2004. On that day, however, I had to deal with two applications by the First Respondent. Both applications essentially stem from the order for the parties to discover. The first application seeks the following orders:
(1) Robert Southwell of KPMG Chartered Accountants be appointed as a Receiver and Manager for the Third Respondents herein namely:
(a) White Corner Investments Limited,
(b) Redcoco Properties Limited
(c) Nokange Consultancy Services Limited
(d) Golikuka Business Group Inc.
(2) That the Petitioner forthwith provide to the Receiver and Manager a personal assets/liabilities statement identifying his nett current and fixed assets held under his personal name.
(3) That the duly appointed Receiver Manager in addition to all other powers, duties and functions legally conferred undertake an enquiry pursuant to order 14 Rule 2 of the National Court Rules into the beneficial ownership of the Third Respondents and to provide to the Court at the earliest opportunity a report on:
(a) the present nett value of the Petitioner’s equity in the Third Respondents,
(b) when and how any third party acquired any shares or equity in the Third Respondents,
(c) whether the third party properly and legally acquired each of their joint and several shares or equity in the Third Respondents,
(d) any transaction in respect of the legal and beneficial ownership:
(i) of the equity in the Third Respondents, or
(ii) of assets owned by the Third Respondents,
which may be affected by operation of section 93 of the Act.
The second application seeks the following orders:
4. Any other orders deemed appropriate by the court.
The applications were actually heard in four stages. It is convenient to maintain the separation. I have ruled on the request for requirement of service to be dispensed; and the vacating of the trial date. What remains to be resolved relate to the appointment of a receiver and manager; and striking out of the Petitioner’s Reply.
Requirement for Service dispensed
The substantive proceeding was set down for trial on 20th July 2004 which is the same day the applications were brought before me. Consequently, I could not have insisted on compliance with the service requirements under the National Court Rules. Given the urgency of the applications, I heard and granted the prayer that the requirements for service of Notice of Motion under the National Court Rules be dispensed with. This cleared the stage for the parties to argue the question of whether the trial date should be vacated.
Vacating the trial date
I noted that the Petitioner and Third Respondents had not adequately complied with the discovery process. I also noted the case of Ok Tedi Mining Ltd v. Niugini Insurance Corporation and Ors (No. 1).[1] Bearing in mind the outstanding substantive issues of custody and maintenance, and property settlement, I considered that the non-disclosure or inadequate discovery is not only unhelpful to the Court but may be prejudicial to the First Respondent and, for that matter, the Petitioner as well. Particulars relevant to an amicable resolution of the substantive issues had not been revealed. I was, thus, persuaded, after listening to arguments from all three counsel, that the substantive matter was not ready for trial as orders for discovery had not been sufficiently complied with. Therefore, by virtue of my powers under the National Court Rules[2], the trial date was vacated.
Appointment of receiver and manager
The third stage comprises of the balance of the first application, which I must now rule on. It relates essentially to the appointment of a receiver on the grounds that, first, the Third Respondents have not complied with orders for discovery on matters essential to the resolution of the remaining issues; and, second, it is necessary to determine, pursuant to s. 93 of the Matrimonial Causes Act, whether certain transactions may have been made to defeat the substantive claims. The relevant paragraphs of the appropriate Notice of Motion are paragraphs 2, 3, 4, and 6.[3]
I had actually already found in my ruling, on whether the trial date should be vacated, that the Petitioner and the Third Respondents had not adequately discovered. I related this to counsel in my Chamber. What remains to be highlighted, for the purpose of this application, is the extent and seriousness of the default.
In that connection, my perusal of the Court file reveals that there has been a number of Requests for Discovery. The first one was filed by the First Respondent on 17th December 1999 requesting the Petitioner to make discovery on oath of documents that are or have been in his possession, custody or power relating to matters that are in question in the proceedings. In brief, they include:
1. All documents of relevance.
2. Certificate of marriage.
3. Certificate of birth of all children of the marriage.
4. Certificate of Titles to real property.
5. Share Certificates.
6. Statutory Register or record of all companies.
9. Quick sale and market valuations of all real and personal property.
10. Financial Statements audited or otherwise of all companies.
The second Request for Discovery by First Respondent was filed on 12th February 2001 requesting discovery on essentially the same matters. The third and fourth Requests for Discovery were filed by the First Respondent on 8th January 2002; and by the Petitioner on 02nd February 2002. The fifth Request for Discovery was again filed by the First Respondent on 31st May 2002.
There have been, altogether, a total of five Requests for Discovery, one for the Petitioner and four for the First Respondent. The First Respondent, as per her List of Documents dated 30th September 2002, has so far discovered 102 documents. In contrast, the Petitioner and or the Third Respondents have discovered only 12 documents.
A number of orders have also been made for the purpose of discovery. These orders were prompted obviously by the lack of proper discovery. The first of such orders was made on 23rd October 2000, which relevantly states:
"8. All parties in these proceedings engage in such discovery process, interrogatories, so forth such are necessary to give full disclosure of properties subject of this dispute before the 17th of November 2000.
"9. The parties are given liberty to apply for discovery or interlocutory orders to expedite the substantive hearing, and that any motions should be filed and dealt with on or before the 17th of November, 2000."
The second order was the Order of 18th December 2001 which states:
"1. The marriage is dissolved forthwith by a decree nisi.
"5. The remaining substantive issues of the custody of the child Martha Haro and settlement of property are inseparable and shall be tried jointly.
"7. The Petitioner files and serves a Request for Discovery on the First Respondent within 15 days.
"8. The First Respondent files and serves on the Petitioner and the Third Respondents a Request for Discovery within 15 days.
"9. The Third Respondents file and serve on the Petitioner and the First Respondent a Request for Discovery within 15 days.
"10. The Petitioner, First Respondent and Third Respondent shall within 30 days file and serve on each other a list of all properties real or personal, legal or equitable, owned by them jointly or severally."
The reasons for continuous requests and orders for discovery can be deducted from the affidavits of Naomi Kludapalo on behalf of the Third Respondents. Her first response was made in her affidavit sworn on 19th October 2000 and filed on 20th October 2000. Relevantly, she deposed as follows:
"6. I refer to paragraphs 6, 7(3) and 10 of the Respondent’s Request for Discovery and says as follows –
(a) Paragraph 6 thereof
While the [First] Respondent is entitled to know the companies or business entities, if any, owned or controlled by the Petitioner, I object to the discovery of records of those companies and business entities as stated in paragraph 2 of my affidavit herein. These documents are confidential for business purposes and can only be disclosed, divulged or released upon resolution made by their members at a board of directors or committee meeting.
(b) Paragraph 7(3) thereof
I object to the discovery of the bank statements of those companies and business entities as stated in paragraph 2 of my affidavit herein. I repeat the same reason as set out hereinbefore.
(c) Paragraph 10 thereof
I object to the discovery of the financial statements of those companies and business entities as stated in paragraph 2 of my affidavit herein for the same reason as aforesaid.
In the second instance, Naomi Kludapalo swore and filed an affidavit on 6th February 2002 and 30th April 2002 respectively, wherein only 12 documents were discovered. In addition, she deposed in this manner:
"2. (b) I object to produce the documents specified in the second part
of Schedule 1 to this affidavit on the ground that documents are privileged from production on the ground of legal professional privilege.
(c) I object to produce the documents specified in the third part of Schedule 1 to this affidavit on the ground that these documents are company and business records of which I am not in authority to disclose until disclosure is approved by the shareholders or members and directors or committees of the Third Respondents."
Apparent from the records is the continuous refusal by the Third Respondents to discover. The First Respondent argues, therefore, that requests and orders have simply been ignored and the delay it has caused is substantial. The Petitioner’s and the Third Respondents’ refusal to discover, it is argued, have been made on irrelevant grounds. The records show that the first Request for Discovery was made by the First Respondent on 17th December 1999. That means the parties have been uncooperative for more than three and a half years. The First Respondent argues therefore that the appointment of a receiver is the only legitimate way in which the Court will take control of the proceedings. It is argued that if Court Orders were not able to compel the Petitioner, no further orders can. The element of trust is lost. The court must take appropriate action. The Court requires the assistance of its own officer in the form of a receiver.
It is further argued that there has been, at least, a deliberate concealment of information. As deposed in the affidavit of Kerenga Kua dated 19th October 2000, the Petitioner was served with a Notice of Discovery to discover bank accounts but he refused to disclose an account in the Bank of Hawaii. This account was discovered after the bank was summoned.
It is also argued that certain transactions appear suspicious. In the case of White Corner Investment, for instance, affidavit evidence shows that in 2000, when this proceeding was already on foot, there were 68 company shares. The Petitioner was holding only 7 of the 68 shares. However, from 1995 to 1998 the only shareholders were the Petitioner and Naomi Kludapalou. All of a sudden, shareholding has completely changed and majority shareholding has shifted to someone else. It may be that they have been genuine. It may be to defeat the claims on foot. No one knows unless someone competent, such as a receiver, can inquire into it.
The purpose for discovery, the First Respondent submits, is to bring all relevant evidence into Court so that the Court can make a decision. The Petitioner and the Third Respondents have consistently failed to cooperate in bringing relevant evidence before the Court. It is appropriate therefore to attempt another mode of bringing evidence before the Court by appointing a receiver.
In response, the Third Respondent argues that it is not appropriate to bring in a receiver. There are three companies and a business group. These companies and a business group are owned by various other people. Their rights, it is submitted, have to be properly weighed. Those shareholders have substantial shares. Their rights will be affected by the appointment of a receiver. Secondly, the Third Respondent companies are statutory creatures; and any decision affecting their interests ought to be consistent with the governing statute being the Companies Act. Under the Companies Act therefore the purpose of placing a company in receivership is to pay out debts of company which is not the case here. Consequently, it is submitted that it is not proper to appoint a receiver.
Thirdly, the appointment of a receiver and manager would violate s. 41 of the Constitution. Companies are legal persons and are governed by the Companies Act. Shareholders would be affected greatly by receivership. In addition, the proceeding involves settlement of property and perhaps maintenance, the latter depending on how custody is decided. All parties must ensure that settlement is reasonable but a receiver’s costs can be too high. Who would pay for their costs? The parties may be paying unnecessary receivership costs, when money is needed to settle the outstanding issues.
Furthermore, the Third Respondents agree that information required for discovery by the First Respondent is relevant to resolving outstanding issues and therefore beneficial to all parties. The Third Respondent is therefore willing to disclose all relevant documents for the purpose of this proceeding. They are willing to disclose all relevant information all certificate of title to properties, share certificates of companies, statutory register of companies, certificate of registration and insurance of motor vehicles, details of sales and market value of assets, and financial statements for 1995 to 2001. However, as to bank accounts, the Third Respondents will not disclose information on the basis that those companies are owned by various other people and their rights and interests will be affected. Other shareholders’ interests must be protected as well.
Moreover, the White Corner Investment Limited, it is submitted, is not attempting to hide the Petitioner’s legal or equitable interest in it. It is true that shareholdings have increased and shareholders are now immediate relatives of the Petitioner. The company was formed from a shelf company and has progressed to where it is at now. It is not correct to say that the company is involved in trying to defeat the First Respondent’s claims. In addition, if a receiver is appointed, it is a concern whether he will have concern for the arrangements undertaken by the companies such as mortgages with the banks. There have been instances where receivership has affected companies trading and financial obligations.
For these reasons, the Third Respondent submits that the court should revert to the original position and require all parties to continue to discover.
Observations
Ultimately, only two courses of action are proposed. According to the Third Respondents, in the light of their willingness to cooperate, they submit that the Court should revert to the original position and make orders for further discovery. According to the First Respondent, however, the Court should appoint a receiver to deal with matters that the discovery process has failed to deal with.
Appointing a receiver in the circumstances could be the first of its kind. Accordingly, I propose to detour at this juncture to consider the Court’s authority to appoint a receiver and the circumstances where such authority may be exercised.
The scope of the Court’s power to deal with a failure to discover is initially found under Order 9 Rule 15 of the National Court Rules. Relevantly, subr. (1) of Rule 15 provides:
"Where a party makes default in filing or serving a list of documents or affidavit or other document, or in producing any document as required by or under this Division, the Court may make such order as it thinks fit, including:
"(a) if the party in default is a plaintiff—an order that the proceedings be stayed or dismissed as to the whole or any part of the relief claimed by him in the proceedings; or
"(b) if the proceedings were commenced by writ of summons and the party in default is a defendant—an order that his defence be struck out and that judgment be entered accordingly."
(my emphasis)
As to receivers, the Court is specifically empowered under the National Court Rules to appoint a receiver for the purpose of enforcement of a judgment for the payment of money[4]; and, in urgent cases, for the purpose of interim preservation of property before the commencement of a proceeding[5]. The general power of the Court in relation to receivers is more substantively, but not adequately, provided for in Division 3 (Receivers) of Order 14 (Miscellaneous Powers of the Court)[6], where provisions for address for service; security; remuneration; accounts; default; and, account on death, are found.
Section 155(4) of the Constitution also equips the Court with the "inherent power to make, in such circumstances as seem to them proper, orders in the nature of prerogative writs and such other orders as are necessary to do justice in the circumstances of a particular case."
The cumulative effect of these provisions is that the Court has the discretionary authority to appoint a receiver in any appropriate proceeding before it. However, like all exercise of discretion, the exercise of that authority has to be justified. It is therefore necessary to appreciate the types of situations warranting the appointment of a receiver.
In that regard, the following examples are helpful. The position in England, according to Kerr On the Law and Practice as to Receivers[7], is that the English Court of Chancery and the High Court of Justice have the jurisdiction to appoint a receiver "by interlocutory order in all cases in which it appears to the court to be just and convenient that such an order should be made; and any such order may be made either unconditionally or upon such terms and conditions as the court thinks just."
Osborn’s Concise Law Dictionary[8] defines ‘receiver’ as a person appointed by the court or individual for the collection or protection of property. That is consistent with the authority of the Court under the National Court Rules, where, as already mentioned, a receiver may be appointed for enforcement of judgments[9], and for the interim preservation, disposal or distribution of property[10]. The PNG Companies & Securities Law Guide[11] also explains the purpose of appointing a receiver, thus:
"The appointment of a receiver by the Court is unusual. Equity enables the Court to exercise its jurisdiction to appoint a receiver in two clear instances: where the appointment is necessary to preserve property pending litigation or to facilitate execution of property[12]."
Kerr On the Law and Practice as to Receivers[13] also explains that:
"A receiver can be properly appointed for the purpose of getting in and holding or securing funds or other property, which the court at the trial, or in the course of action, will have the means of distributing amongst, or making over to, the persons or person entitled thereto. The object sought by such appointment is therefore the safeguarding of property for the benefit of those entitled to it. There are two main classes of cases in which appointment is made: (1) to enable persons who possess rights over property to obtain the benefit of those rights and to preserve the property pending realization, where ordinary legal remedies are defective; and (2) to preserve property from some danger which threatens it."
Mr. Kua also referred me to s. 93 of the Matrimonial Causes Act which provides:
"93. Transactions intended to defeat claims.
(1) ....
(2) In proceedings under this Act, the Court may set aside or restrain the making of an instrument or disposition by or on behalf of, or by direction or in the interests of, a party, if it is made or proposed to be made to defeat an existing or anticipated order in the proceedings for costs, damages, maintenance or the making or variation of a settlement.
(3) The Court may order that money or property dealt with by an instrument or disposition referred to in Subsection (2) may be taken in execution or charged with the payment of such sums for costs, damages or maintenance as the Court directs, or that the proceeds of a sale shall be paid into court to abide its order.
(4) In making an order or setting aside or restraining the making of an instrument or disposition under this section, the Court shall have regard to the interests of, and shall make any order proper for the protection of, a bona fide purchaser or other person interested.
(5) A party or a person acting in collusion with a party may be ordered to pay the costs of any other party, or of a bona fide purchaser or other person interested, of and incidental to an instrument or disposition referred to in this section and the setting aside or restraining of it."
The Court can, it is submitted, appoint a receiver in appropriate cases to facilitate the exercise of the Court’s power under this provision. In other words, whether certain transactions have occurred to defeat a claim can only be determined by someone as specialized as a receiver.
In Gabriel Velegamus v. Paul Aisoli[14], a receiver was appointed where the property of the company was in jeopardy and where the ownership and or control of the company were in dispute such that there was no effective management.
On the basis of the foregoing observations, in considering whether a receiver should be appointed or not, the following considerations are therefore relevant:
(a) where the appointment is necessary to facilitate execution of property;
(b) where the appointment is necessary for the purpose of safeguarding the property for the benefit of those who may be entitled to it;
(c) where the appointment is necessary to preserve property from some danger which threatens it;
(d) where the appointment is necessary to ascertain whether certain transactions have occurred to defeat matrimonial causes claims;
(e) where the appointment is necessary to enable the Court to expedite a proceeding before it;
(f) where the appointment is necessary to enable the Court to avail itself of relevant evidence;
(g) where the appointment is necessary to enable a company to continue to operate; and,
(h) where the appointment appears to the Court to be just and convenient.
I return to the question of whether the parties should continue to discover or whether a receiver should be appointed.
In that regard, I note the submission by the Third Respondents that the appointment of a receiver may affect the rights and interests of shareholders but it is unclear as to how that would be so. In any event, the shareholders, who are the Petitioner’s relatives, are also responsible for the Third Respondents’ failure to discover. Secondly, the Third Respondents are parties to the proceeding and as such are exposed to the Court’s authority and mandate to take all appropriate steps to resolve the legal dispute between the parties. Accordingly, I reject the suggestion that they should only be dealt with under the Companies Act. I also reject the Third Respondents’ arguments on the basis of s. 41 of the Constitution on the basis that it is irrelevant.
In addition, it is true that the appointment of a receiver may, to a certain extent, be costly to the parties but, first, such costs are subject to the Court’s approval; and, secondly, such a course may be justifiable by the Third Respondent’s consistent failure to adequately discover. The Third Respondents also say that they are willing to discover but no disclosure would be allowed on bank accounts on the basis that those companies are owned by various other people and their rights and interests will be affected. It has, however, not been shown as to how the rights of other people will be affected. Besides, here again is the element of mistrust and no confidence in the judicial process. If every proceeding is deprived of relevant evidence, the courts will never deliver justice. In addition, why ask for further discovery when you still cannot give full discovery.
In the circumstances, I will refuse the Third Respondents’ invitation for further discovery. It is a process that has been attempted and has failed over a considerably long period to assist anybody.
In considering whether a receiver should be appointed, I take the following factors into account. Firstly, the First Respondent has done nothing wrong. She has discovered over one hundred documents and no substantive complaint has been raised about her non-compliance. She has been waiting in vain for more than three and a half years for proper discovery to be made.
On the other hand, the Third Respondents have failed to discover and are probably in contempt of court. Their failure has impacted on the Court’s duty to administer justice in this case. Requests for Discovery and Court Orders have been in vain. In fact, by not discovering, and by not complying with Court Orders, the Third Respondents have shown ultimately that they do not trust the Court as the formal avenue for dispute resolution in this jurisdiction.
In addition, by not discovering, I am entitled to conclude that the Third Respondents have something to hide. I am thus reminded of the change and increase in ownership of shares in White Corner Investments Limited. The consistent failure to discover gives reasonable grounds to frown at the transactions affecting shareholdings in the company while the substantive proceeding was about to or was already on foot.
The balance of the issues pending is not difficult for the Court to determine but the absence of appropriate evidence, which were expected to be disclosed through discovery, has prevented the Court from performing its constitutional responsibilities. The duration of the consequential delay is more than three and a half years. In my view, therefore, the failure by the Third Respondent to adequately discover is serious enough to warrant a change of process. The alternative process must be one that will enable the Court to take control of the proceedings with a view to having it finalized without further delays.
In the circumstances, the appointment of a receiver and manager is warranted. I order specifically that:
(1) Robert Southwell of KPMG Chartered Accountants is appointed as a Receiver and Manager for the Third Respondents herein namely:
(a) White Corner Investments Limited,
(b) Redcoco Properties Limited
(c) Nokange Consultancy Services Limited
(d) Golikuka Business Group Inc.
(2) The Petitioner forthwith provide to the Receiver and Manager a personal assets/liabilities statement identifying his nett current and fixed assets held under his personal name.
(3) The duly appointed Receiver and Manager in addition to all other powers, duties and functions legally conferred undertake an enquiry pursuant to order 14 Rule 2 of the National Court Rules into the beneficial ownership of the Third Respondents and to provide to the Court at the earliest opportunity a report on:
(a) the present nett value of the Petitioner’s equity in the Third Respondents,
(b) when and how any third party acquired any shares or equity in the Third Respondents,
(c) whether the third party properly and legally acquired each of their joint and several shares or equity in the Third Respondents,
(d) any transaction in respect of the legal and beneficial ownership:
(i) of the equity in the Third Respondents, or
(ii) of assets owned by the Third Respondents,
which may be affected by operation of section 93 of the Act.
As the application is against the Third Respondents only, I will award costs of and incidental to this application against the Third Respondent only, which, if not agreed, shall be taxed.
Striking out of Reply
The second application primarily seeks against the Petitioner, on the same grounds relied upon in the first application, for an order pursuant to s. 145 of the Matrimonial Causes Rules and or Order 9 Rule 15 (1) of the National Court Rules that the Petitioner’s Reply filed on or around the 10th October 1999 be struck out. Other orders sought are peripheral in nature.
Section 145 of the Matrimonial Causes Rules provides:
"Where a party to any proceedings fails to comply with an order to give particulars, to file an affidavit of discovery, to make discovery or to produce documents, the Court may order that—
(a) if the party is the petitioner—the proceedings instituted by the petition be stayed or dismissed for want of prosecution; or
(b) if the party is the respondent—any proceedings instituted by him by an answer to the petition, and any other proceedings instituted by him in relation to proceedings instituted by the petition, be stayed or dismissed for want of prosecution; or
(c) if the party is any other party—his answer or reply, as the case may be, be struck out."
Order 9 Rule 15(1) of the National Court Rules provides:
"Where a party makes default in filing or serving a list of documents or affidavit or other document, or in producing any document as required by or under this Division, the Court may make such order as it thinks fit, including—
"(a) if the party in default is a plaintiff—an order that the proceedings be stayed or dismissed as to the whole or any part of the relief claimed by him in the proceedings; or
"(b) if the proceedings were commenced by writ of summons and the party in default is a defendant—an order that his defence be struck out and that judgment be entered accordingly."
Under s. 145 of the Matrimonial Causes Rules, the Court may stay or dismiss the proceeding if the Petitioner defaults. A Reply may be struck out only if the defaulting party is any other party. A similar scheme is found under Order 9 Rule 15(1) of the National Court Rules. Prima facie, the Court cannot strike out the Petitioner’s reply.
Whatever the case may be, I am of the view that the substantive pleadings should not be interfered with. This proceeding is a divorce proceeding; and, we all know how sensitive it can be. The parties have progressed beyond the substantive pleadings and some substantive reliefs have been granted. It is thus clear that the parties have determined their destiny but how to get there has unfortunately been delayed. Consequently, the parties should not be distracted but be assisted to have the outstanding issues finalized.
I am of the view that without interference the appointed receiver and manager should be able to obtain all the necessary evidence and information to assist the Court to dispose of the balance of the substantive issues between the parties. Consequently, it is unnecessary to strike out the Petitioner’s Reply. I will dismiss this application.
On the question of costs, I take into account that the two applications are actually the same. They are probably separated only for convenience sake. The applications would have proceeded as one. Accordingly, the success of the First Respondent in the earlier application is relevant to the question of cost in this second application. In the circumstances, the parties should bear their own costs of this application.
Orders accordingly.
_________________________________________________________________
Lawyer for the Petitioner : Warner Shand
Lawyer for the First Respondent : Posman Kua Aisi
Lawyer for the Third Respondent : Pryke and Bray
[1] [1988-89] PNGLR 355.
[2] Order 10 Rule 11.
[3] Supra.
[4] Order 13 Rule 2.
[5] Order 14 Rule 9.
[6] Rules 17 to 23.
[7] 14th Ed, Sweet & Maxwell 1972.
[8] Ninth Edition, Sweet & Maxwell, 2001.
[9] Order 13.
[10] Order 14 Division 2.
[11] Par. 1305.
[12] Re Samco Sargent Consolidated Ltd, New Zealand Growth Securities Ltd and International Commercial Management Ltd (1977) 1 BCR 112.
[13] 14th Ed, Sweet & Maxwell 1972.
[14] [1988-89] PNGLR 63.
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