Banjamin v Department of Works [2005] PGNC 80; N2874 (28 July 2005)

N2874

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE
AT LAE]

WS 1126 OF 1996

PHILIP BENJAMIN
(Plaintiff)

AND:

DEPARTMENT OF WORKS

(First Defendant)

AND:

THE INDEPENDENT STATE OF PAPUA NEW GUINEA

(Second Defendant)

LAE: Davani, J
2005: 12th & 28th July

PRACTICE AND PROCEDURE – entry of default judgment – assessment of damages – plaintiff, an individual – evidence show claim by company – claim by individual must fail.

PRACTICE AND PROCEDURE – entry of default judgment – assessment of damages – evidence confusing and contradictory – damages to be proven by credible evidence.

Cases cited:
• Obed Lalip for himself and on behalf of Marae Kulap and Francis Minabo v Fred Sikiot and The State (1996) N1457.
• Coecon Ltd v National Fisheries Authorities of PNG (2002) N2182
• William Mel v Coleman Pakalia (2003) N247

Counsel:
P. Ousi for the plaintiff
G. Pipike for the second defendant
No appearance for the first defendant

DECISION

28th July, 2005

DAVANI, J: The plaintiff applies by Writ of Summons and Statement of Claim filed on 19th November, 1996 seeking various orders more particularly, damages. The plaintiff’s claim for damages arise from a motor vehicle accident where a truck he owned fell through a bridge. He claims for revenue lost during the period the truck was being repaired and repairs to the vehicle.

Default judgment was entered against the defendants on 14th April, 1997. The matter is now before me for assessment of damages.

Evidence

The plaintiff relies on the following affidavits in support of his claim. These are:

1. His three affidavits sworn on 6th October, 1997, 22nd March, 2004 and 15th April, 2004;
   
2. Robin S. Siwi’s affidavit sworn on 14th April, 2004;
   
3. The evidence of the plaintiff’s employed driver.
   

The defendants rely on the affidavits of Philip Anis sworn on 30th May, 2005 and filed on 5th July, 2005 and Steven Veraga, sworn on 14th July, 2005 and filed on 6th July, 2005.

Preliminary

During the trial, counsel for the defendants raised objections in relation to the tendering of certain exhibits which I either over-ruled or upheld. I discuss these evidence together with my conclusions as to their acceptance or not, at the appropriate time.

Several issues were put before the Court by defendants’ counsel which I find are issues pertinent to this case. They are:

1. Who is the proper plaintiff to claim damages?;
   
2. Who owns the vehicle, the subject of these proceedings?;
   
3. Whether the vehicle allegedly damaged, is the same vehicle that was repaired?;
   
4. Whether the invoices issued were genuine invoices?;
   
5. Whether the plaintiff paid for the parts allegedly supplied to repair the vehicle.
   

Brief Facts

The plaintiff’s substantive action against the Defendants is for their failure to properly maintain the bridge which resulted in the deckings becoming rotten and subsequently, the vehicle falling through.

The evidence is that the motor vehicle accident occurred on 17th August, 1995, when the vehicle driven by the plaintiff’s employed driver, fell through the deckings of the Diawa Bridge situated on the Bulolo-Aseki Road. As a result, the vehicle sustained extensive damage to its undercarriage.

The plaintiff claims that he owns this motor vehicle, a Hino six wheeler truck, Registration Number LAC 429 (the ‘vehicle’). The plaintiff claims that at the time of the accident, he owned a trade store located in Menyamya known as "Bens Trading", which trade store suffered losses when the vehicle was off the road.

He also claims that apart from the trade store and trucking business, the vehicle also transported green bean coffee which he bought and sold in the outlying parts of the Morobe Province. The vehicle also transported supplies from Lae for his trade store.

Particulars of Damages and Loss

The plaintiff alleges that as a result of the accident, his vehicle was put in the workshop to be repaired and was not operational for three (3) months, as a result of which he suffered losses. He alleges that losses suffered were between the period 17th August, 1995 to November 1995.

The plaintiff’s pleadings in relation to damage and loss are set out in paragraph 7 of the Statement of Claim. I set these out in full, below;

"7. As a result of the matters aforementioned, the Plaintiff suffered loss of business for three (3) months, the period, the said motor vehicle was in a workshop undergoing mechanical and body repair.

PARTICULARS OF DAMAGES

(i) Heavy duty springs – broken and completely smashed.
(ii) Rear transmission box – completely damaged.
(iii) Rear excel – completely broken.
(iv) Broken shaft.

PARTICULARS OF EXPENSES INCURRED TO RESTORE TRUCK TO OPERATIONAL CAPACITY

The Plaintiff incurred the following expenses in restoring his Hino HHKA, Registration No. LAC-429 to operational capacity:-

Ela Motors

Date Invoice No. Amount

18/08/95 36384 K 523.90

28/08/95 38772 584.04

16/11/95 42495 1,094.66

18/11/95 38867 11,310.00

K13,512.60

PNG Spring Smith

Date Invoice No. Amount

29/09/05 82 K 430.00

Bens Trading

Date Payment Voucher Amount

17/08/95 44 K 320.50

17/08/95 45 360.00

17/08/95 84 183.15

28/08/95 46 430.00

30/08/95 85 350.00

31/08/95 47 1,050.00

31/08/95 48 930.00

K3,943.65

Air Niugini

Date Ticket No. Amount

04/10/95 K 196.50

" C.1381061 62.44

Miscellaneous 10,855.31

Sub-total K11,114.25

GRAND TOTAL: K29,000.50

PARTICULARS OF LOSS OF BUSINESS/REVENUE

(A) Loss of profits as a direct result of transport accident due to State negligence to maintain the bridge on Kapau River.

Back Load

1. Sales
   
   • 1.1 Trade Goods
     

Average Daily Sales = K3,000.00

Business Working Days = 6 days

Loss Sales Turn over/week

= K5,000.00 x 6 days = K18,000.00/week

1.2 Coffee

Average Parchment Coffee per trip = 5,500kg

Trip in a week = 3 trips

Percentage turnout as Green Bean = 74%

Contract Price on Green Bean = K3.15

Loss on sales over on green beans per week

5,500kg x 3 trips x 74% turnout x 3.16

Contract price = K38,461.50 per week

(B) Freight

• 2.1 Trade Goods
  

Average tonnage per trip = 5,500kg

Freight charge = .10t per kg

Number of trips per week = 3 trips per week

Loss on transport turnover 5,500kg x .10t x 3 trips

= K1,650.00 per week

2.2 Coffee

Average tonnage per week = 5,500kg

Freight charge = .10t per kg

Number of trips per week = 3 trips

*Loss incurred on transport 5,500 kg x .10t x 3 trips = K1,650.00 per week

*Purchasing power per week

Number of trips per week = 3 trips

Average purchase per trip = K8,000.00 per trip

Mark on purchase trip per week = 22%

Estimated loss = K29,280.00 per week

Total estimated loss incurred by business as a result of the accident.

1.1 18,000.00
1.2 38,461.50
1.3 1,650.00
1.4 1,650.00

K59,761.50 per week

Duration of six (6) weeks (17/08/95-01/10/95)

K59,761.50 x 6 weeks = K358,569.00

Less expenses incurred per week = K15,000.00

Expenses incurred per week

1. Accommodation = K 300.00

2. Fuel Hino = 250.00

3. Driver’s wages = 150.00

4. Offsider’s wages = 70.00

5. Travelling Allowance = 80.00

6. Medical Expenses = 20.00

7. Food = 52.50

8. AGC Finance = 377.50

9. SPI Insurance = 125.00

10. Tyre Service = 375.00

11. Truck Service = 375.00

12. Employee Wages = 325.00
K2,500.00

K2,500.00 per week x duration of 6 weeks = K15,000.00

*Loss of Profit

Income-Expenses = Profit

(K18,000.00 + K38,461.50 + K1,650.00 + K1,650.00 x

duration of 6 weeks = K358,569.00)

less K15,000.00 expenses

Grand Total = K343, 569.00"

Analysis of evidence and the law

Liability - The issues raised earlier are significant in that the Court will then have to decide whether these are issues that should be raised after the entry of default judgment considering liability is no longer in issue.

First issue; who is the proper plaintiff to claim damages? The plaintiff sues as an individual, Philip Benjamin. This is demonstrated in pars. 1 and 3 of the Statement of Claim, which I set out below;

"1. The plaintiff is a private citizen carrying out the business of general merchandising, retailing and coffee buying in Menyamya, Morobe Province.

.....................

3. On or about the 17th August, 1995, the Plaintiff by his employed driver drove his motor vehicle, a Hino six (6) wheeler ......" (My emphasis)
   

Therefore, upon the entry of default judgment, damages to be assessed should be for "Philip Benjamin", the individual.

Second issue; ownership of the vehicle; Upon entry of default judgment, the issue of who owns the vehicle is no longer before me, that it is Philip Benjamin who owns the vehicle. But, the plaintiff must still show that he is the owner of the vehicle at the time of the accident, before he can claim losses suffered by him personally. A Registration Certificate handed up to me and marked exhibit "A", is dated 30th September, 1996. That does not show ownership by the plaintiff of the vehicle on 17th August, 1995. A Motor Vehicles Insurance (PNG) Trust Third Party Insurance Cover Certificate shows registration for the vehicle for the period 30th September, 1996 to 30th September, 1997. That does not show that the plaintiff was the owner of the vehicle on 17th August, 1995. In any event, I note the issuing branch to be Ela Motors Wewak. And there is no explanation as to why Ela Motors Wewak is the issuing branch when the plaintiff’s evidence is that the vehicle was purchased in Lae and operated in Lae and the outlying Morobe Province districts.

As for the Inspection Report, it states the owner of the vehicle to be ‘Bens Trading’. And ‘Bens Trading’ was incorporated as ‘Bens Trading Limited’ on 20th February, 1996, confirmed by a Certificate of Incorporation from the Companies Office dated 2nd September, 1998, which is before me as exhibit "A" for the Defendants. The plaintiff’s lawyer also handed up to me a vehicle registration certificate dated about 1995, before the accident, but which I did not accept because it had delineations written on it in biro, where the registration number of the vehicle was altered in ink from another registration number to LAC-429, the vehicles registration number. The amount paid was also altered in red ink to another amount.

So there is no evidence before me that the vehicle was owned by the plaintiff individually, at the time of the accident, consistent with the statement of claim.

Third issue; damage to the vehicle; The plaintiff’s evidence is that the vehicle sustained major damage to its heavy duty springs, rear transmission box, rear excel and shaft.

To prove the extent of damages to the vehicle and the state the vehicle was in when it was taken in for repairs, the Court must have evidence from a mechanic. I do not have any evidence of that nature before me.

The only evidence I have are photographs of the vehicle after the accident. The photographs are attached to the plaintiff’s affidavit sworn on 6th October, 1997, and filed on 12th November, 1997. They show a truck which has partially fallen through a bridge with broken boards. But the photographs do not show a number plate attached or affixed to the truck.

The plaintiff also has put before the Court copies of Ela Motors invoices to show repair work done to the vehicle and costs incurred by him for the repair work. However, I note there to be discrepancies in that evidence which I set out below:

1. The plaintiff’s evidence is that the vehicle was taken to Aka Motors immediately after the accident where it was repaired and that it was kept there for about 8 weeks. But there is no evidence before me of receipts issued by Aka Motors or at least, a report from Aka Motors as to the repair work done to the vehicle. Even then, the plaintiff’s Statement of Claim does not plead a claim for repair work done at and by Aka Motors.
   
3. Exhibit "D" for the plaintiff, an invoice from Ela Motors number 42495L dated 16th November, 1995, for an amount of K1,094.66 is not evidence of payment. In fact, the terms and conditions on the invoice states "ownership of the items detailed in this invoice shall only be transferred to the purchaser(s) when payment of the items has been made in full...".
   

The plaintiff’s evidence is that he incurred expenses when the vehicle was repaired. But an invoice is not evidence of payment. I expound further on this at the end of this part.

As the plaintiffs contentions that invoice no. 38867 dated 18th November, 1995 is missing, the plaintiff has not brought evidence from Ela Motors to show that an invoice in that description was issued and payment received.

The other invoices that the plaintiff deposed to at par. 9 of his affidavit sworn on 22nd March, 2004, and which are also particularized at par. 7 of the Statement of Claim are not receipts. They are not evidence of payment. Again there is no evidence from Ela Motors to confirm that payments in the amounts of K584.04, K1094.66, K11,310.00 and K6,181.12, amounts pleaded in the statement of claim, were received from the plaintiff.

To remove any doubts as to the meaning or definition of ‘invoice’, I set these out together with the meaning or definition of ‘receipt’. ‘The Australian Oxford Paperback Dictionary’ third Edition (2001), defines ‘invoice’ and ‘receipt’ as:

‘invoice – list of goods sent or services performed with prices and charges’.

"receipt – 1. receiving, being received (on receipt of your letter)

2. written acknowledgement that something has been received or that money has been paid.
3. (receipts) am amount (of money) or quantity received or mark (a bill) as having been paid."
   

Collins Mini Thesaurus (reprinted)(2001) does not provide a definition of ‘invoice’ but states a ‘receipt’ to be a "sales slip, counterfoil, proof of purchase".

So, the provided definitions only reinforce this Court’s finding that an invoice is not a receipt and cannot be relied on by this Court in ordering damages.

4. I have heard submissions from defendant’s counsel, on the different chassis and engine numbers of the vehicle. These differences only compound the issue of the number of vehicles that are the subject of these proceedings and whether the Hino truck allegedly owned by the plaintiff or Bens Trading is the same truck that was involved in the accident.
   

The documentation that bear the different chassis and engine numbers are the Registration Certificate, the Motor Vehicle Insurance (PNG) Trust Certificate and the Motor Vehicle Inspection report. These are all attached as annexures to the plaintiff’s affidavit sown on 22nd March, 2004. The differences that were put to me are:

(i) the two certificates, both dated 30th September, 1996, have stated herein, engine number B19358 and chassis number 10233.

(ii) However, the Inspection Report has the engine number noted as HO7D-410526 and chassis number GT3HHK-10027. The three documents carry the same registration number of the vehicle, being LAC 429.

This overwhelming evidence tells me that either these are two different vehicles or the documentation before me are not genuine. I find that the plaintiff’s evidence on the vehicle is unreliable.

5. I have heard further submissions that annexure "F" to the plaintiff’s affidavit of 22nd March, 2004, which is Ela Motors invoice no. TLCSL15928 bears the delivery date of 31st August, 1994. The accident occurred on 17th August, 1995.
   

There is no explanation from the plaintiff on this alarming anomaly. The only conclusion I can draw is that the expenses incurred on 31st August, 1994 do not relate to the accident of 17th August, 1995.

Fifth issue; loss of business; I have set out in full in the earlier part of this decision, the plaintiff’s claimed losses as pleaded in the Statement of Claim. The plaintiff attributes the loss of business to the vehicle being off the road because of the accident.

But the plaintiff’s claim is for losses he suffered, as a person. If it is by "Bens Trading", that is not pleaded. Furthermore, the defendant has put before me the affidavit of one Steven Vaga, search clerk, employed in the firm Paul Paraka Lawyers, affidavit sworn on 1st July, 2005, who on 30th June, 2005, conducted a search at the Companies Office on ‘Bens Trading’ and found that ‘Bens Trading’ is not a registered business name but is a duly registered company described as ‘Bens Trading Limited’ bearing registration number 1-25159. This company was incorporated on 20th February, 1996. There are five (5) directors, all appointed on 20th February, 1996. They are Misek Abraham, Titus Mathew, Samson Peter, Peter Philip, and the plaintiff. These men are all shareholders of "Bens Trading Limited", each holding one (1) ordinary share each. I was also referred to a Certificate of Incorporation of ‘Bens Trading Limited’, which is before me in evidence. Although Mr Ousi for the plaintiff submits that the plaintiff was trading as a business name, there is no evidence to that effect, apart from Mr Ousi’s submissions. The defendants’ evidence on ‘Bens Trading Limited’ being an incorporated company, is the only reliable evidence before me which I will accept. Which of course casts a lot of doubt on the plaintiff’s claim because the plaintiff claims as an individual, not as an incorporated entity.

Even the evidence from Robin S. Siwick, accountant, only adds more doubt to the plaintiff’s claim for damages. Mr Siwick graduated from the University of Technology in 1990 with a degree in accountancy. His evidence is that he is a self-employed accountant who has had extensive experience in preparing and lodging financial and tax returns for individuals and companies. He produced to the Court financial statements for ‘Bens Trading’ for the years 1994, 1995, and 1996 which are before me in evidence. However, at paragraph 4 of his affidavit, he deposes that "the plaintiff" made the following in the way of profit and loss;

1. 1994 - K11,910.00 profit

2. 1995 - 4,471.00 profit

3. 1996 - 70,228.00 loss

which then raises the issue of who the proper plaintiff is. Is it the plaintiff as an individual, or Bens Trading as a business name or Bens Trading Limited? I have perused the report and set out Mr Siwick’s findings which only confirm that Mr Siwick’s report is for a company ‘Bens Trading Limited’. I have underlined relevant parts which show that Mr Siwick’s 1994 report was prepared for a company. These findings are;

1. The financial report is titled ‘Bens Trading, Financial Statements and reports for the year ended 31st December, 1994’.
   
2. The 1994 report is headed ‘Bens Trading, Financial Statement – 31st December, 1994, Report of the proprietors.’
   
3. It reads "Proprietors: The following people hold office as proprietors as at the date of this report:
   
   • - Benjamin Philip (Chairman)
   • - Peter Philip
   • - Daniel Bassiya"
     

4. It continues to read:

"Activities

The principle activity of the firm involved that of retailing and wholesaling of groceries, fuel, hardware and coffee purchasing and is based in Menyama Station, Morobe Province. The firm commenced operations in January 1994.

Results

The net results of the operations of the firm for the year was a net operating profit of K114,910.00.

General

In accordance with the requirements of the Companies Act 1997, the proprietors state that, in their opinion; -

(a) Other than stated in the accounts, the results of the firms operations during the year were not materially affected by items of an abnormal character.

(b) No circumstances have arisen which render adherence to the existing method of valuation of assets and liabilities of the firm misleading or inappropriate.

(c) No contingent liabilities have become enforceable or are likely to become enforceable within the period of twelve (12) months from the date of this report, which would materially affect the firm in its ability to meet his obligation as and when they fall due.

(d) The current assets will realize the value at which they are shown in the accounts and that value in an amount that these current assets might reasonably be expected to realize in the ordinary course of business.

Signed for an on behalf of the proprietors at Menyama this 25th day of September 2003 in accordance with a resolution of the proprietors.

(signed) (signed)

Proprietor Proprietor"

______________________________

Bens Trading

Financial Statement – 31st December 1994

Statement by the proprietors

In the opinion of the proprietors, the balance sheet profit and loss account and notes thereto of the firm set out on pages 4 to 10 are drawn up so as to give a true and fair view of affairs as at 31st December, 1994 and of its results for the year ended on that note.

Signed for and on behalf of the proprietors at Menyamya this 25th day of September, 2003, in accordance with a resolution of the proprietors.

(Signed) Signed

Proprietor Proprietor"

Again, I re-emphasise that the relevant parts that are underlined confirm with no uncertainty that the report was prepared for a company. Mr Siwick refers to the principal/s of Bens Trading as ‘proprietors’. The report is on the "affairs" of the company – that the report was done "in accordance with a resolution of the proprietors." That the report is on the "assets and liabilities" of "the firm", that there are "no contingent liabilities," "the current assets" including the "operations of the firm" showed a profit and lastly "the results of the firm’s operations" during the year are reflected in the report.

The report clearly is one prepared for a company because the expressions used in the report are peculiar to that used by persons associated with incorporated entities, in this case a company.

Even Mr Siwick is unequivocal in his descriptions of the company’s activities where he states that the report is for ‘Bens Trading’, that it is a ‘report of the proprietors’ then he sets out the names of the proprietors.

I have also sighted other parts of the report which only confirm that the report was done for a company. This is contained in the ‘Accountants Disclaimer’ which states that although the accountants had access to ‘books and records’ of ‘the firm’ to enable them to prepare the ‘statement of assets and liabilities’ set out in paragraphs 1 to 10 of that report, that under the terms of their engagement, the accountants ‘did not audit the accounting records of the firm or the statements.’ The disclaimer states "we do not express an opinion whether they present a true and fair view of the position and no warranty of accuracy or reliability is given."

The disclaimer is dated 25th September, 2003, disclaiming responsibility for "any errors or omissions for year ended 31st December, 1994".

The contents of the balance sheet as at 31st December, 1994 and 31st December, 1996 all bear and carry the same or similar wording, as above.

No doubt, the report is prepared for a company. Only a company passes ‘resolutions’, the director or principals of a company are referred to as ‘proprietors’, a company is referred to as a ‘firm’, a company issues ‘paid up capital’, it issues ‘authorized share capital’ ‘issued paid up capital’ and has ‘fixed assets’ (in a company). An individual does not possess these characteristics. These are peculiar only to a company incorporated under the Companies Act.

Mr Pipike for the defendant put several questions on those matters to Mr Siwick whose response was that the reports he prepared were based on information given to him by the plaintiff. So I can conclude that the information he had before him, based on the contents of the reports, were those of a company ‘Bens Trading Limited’. There is no other evidence to the contrary.

The plaintiff’s claim is for liquidated damages and each item of loss must be specifically proven. Defendants’ counsel referred the Court to Coecon Ltd v National Fisheries Authorities of PNG (2002) N2182; William Mel v Coleman Pakalia (2003) N2477 which are authorities on point.

The plaintiff can only claim what is pleaded in the Statement of Claim. Therefore, claims/losses raised in his affidavit material, if not pleaded will not be accepted by the Court. So his claims for loss of goodwill, owner’s capital, deferred interest payments and business opportunity losses, raised in the affidavit material, will fail.

Conclusion

Generally, the claim is by the plaintiff as an individual. The plaintiff’s assertions that he operated as a business name is not pleaded and not supported by evidence. Although Mr Ousi submits that the plaintiff trades as a business name, he has not put before the court evidence showing registration of the business name, to satisfy s. 8 of the Business Names Act 1963, the provision on the registration of business names.

So the claim by the plaintiff supported by the evidence before me, is for losses suffered by a company. But even then, the evidence is very conflicting and unreliable as we have seen, e.g. the engine and chassis numbers of the vehicle are different on the various registration documentation that were put before me. The dates on the invoices are dates before the accident occurred and most importantly, the plaintiff can only produce invoices, no receipts and these are all in the name of ‘Bens Trading’, the entity that is not named as suing the defendants.

The evidence and pleadings are very confusing and contradictory in many respects as demonstrated in the reasons. These uncertainties can only lead to one conclusion and that is that the plaintiff has not proven damages suffered, on the balance of probabilities. (see Obed Lalip for himself and on behalf of Marae Kulap and Francis Minabo v Fred Sikiot and The State (1996) N1457). His Honour, Injia, J in that judgment found that the evidence was very confusing and contradictory and so did not award any damages. He emphasized one point though, which any counsel and plaintiff must always bear in mind, which is that:

"Just because the plaintiff has obtained default judgment does not mean that he is entitled as of right to receive damages. He must prove the damages suffered by credible evidence."

The Court cannot and is unable to assess damages for the plaintiff as an individual because although pleaded, the evidence does not support that. Furthermore, the evidence is contradictory, confusing and misleading in many respects.

In this case, default judgment was entered against the State for an individual. But the supporting evidence for losses suffered is not for an individual but an incorporated entity which is not pleaded.

For these reasons, this Court will not make any award for the plaintiff.

As to costs, because costs follow the event, the plaintiff shall pay the defendants costs of the proceedings, to be taxed if not agreed.

Lawyer for the Plaintiff : Warner Shand Lawyers
Lawyer for the Defendants : Paul Paraka Lawyers