Yuskan v Abilo [2006] PGNC 122; N3108 (15 December 2006)

N3108

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

WS 1369 OF 2002

BETWEEN:

TREVOR YUSKAN, DAVID JOHN WREN AND FRANK WREN
Plaintiffs

AND:

WALIYA ABILO AND DAVID SODE
First Defendants

AND:

THE INDEPENDENT STATE OF
PAPUA NEW GUINEA
Second Defendants

Waigani: Gavara-Nanu, J.
2006: 1, 2 & 4 August;15 December

PRACTICE AND PROCEDURE – Customs Act (Chapter No. 101), s. 140 – Notice of proceedings – Such notice not served on the Customs officer who is a defendant – Actions of Customs officer declared unlawful by another Court – Plaintiffs’ claims based on such decision – Claims against the State based on the actions of Customs Officers – Claims based on s. 2 of Claims By and Against the State Act – Notice under s. 5 of Claims By and Against The State Act, duly given – Such Notice is sufficient – Failure by plaintiffs to comply with Notice under s. 140 of the Customs Act not fatal.

Cases cited

Papua New Guinea Cases

Pike Dame v. Augustine Peri and The State [1993] PNGLR 4
Graham Mappa v. Electricity Commission [1995] PNGLR 170
Port Moresby Enterprises Pty Ltd v. Ainui Diole & Ors (2000 – Unreported)
Toglai Apa & Ors v The State [1995] PNGLR 43
United Trading Pty Ltd v. David Sode, Commissioner of Customs & The State N1925
Banz Kofi Fektori Pty Limited v Raymond Simon Apup N2374
Commissioner General of Internal Revenue Commission v Julian Paul Leech (1998 – Unreported)

Overseas cases

Rookes v. Barnard [1964] UKHL 1; [1964] AC 1129
Uren v. Fairfax & Sons Pty Ltd [1966] HCA 40; [1966] 117 CLR 118
Johnson v. Stewart [1968] SASR 142
Markryllos and Another v. George Laurens (NT) Pty Ltd [1992] 111 FLR 118

Counsel
I. Shepherd, for the plaintiffs
L. Nablu, for the defendants

15 December, 2006

1. GAVARA-NANU, J: The plaintiffs are claiming damages against the defendants for loss of revenue resulting from the unlawful seizure of a motor vessel MV "Vixen" (‘the Vessel’). The plaintiffs’ claim includes legal costs and disbursements which they claim were incurred both in Australia and Papua New Guinea prior to the commencement of these proceedings. They also claim air fares, accommodation, telephone calls, facsimile and related charges.

Facts

2. The plaintiffs are owners of the Vessel which was a registered shark catcher in Australian waters.

3. On 21 November 1999, the Vessel entered Papua New Guinea waters to undergo a refit at the Motukea dockyard in Port Moresby Harbour.

4. The master of the Vessel, one David Wren who is one of the plaintiffs sailed straight to the dockyard. He was advised to notify the Customs Officers in Port Moresby the following day. On the following day, after being advised by David Wren, the Customs Officers visited the Vessel and instructed David Wren to take the Vessel to Port Moresby Customs wharf and await further notice.

5. On 15 December 1999, David Wren was charged at the Port Moresby District Court for failing to report to Customs as provided under s. 21 (1) of the Customs Act, Chapter No. 101 (‘ Customs Act’), a charge to which he pleaded guilty and paid K1,000.00 fine.

6. On 6 December 1999, Customs Officers purported to issue a Notice of Seizure, pursuant to s. 126 of the Customs Act.

7. By OS No. 39 of 2000, the plaintiffs sought a declaration that the Vessel had not been lawfully seized. The application was heard by Sheehan, J. on 14 February, 2000. On 20 June 2000, his Honour delivered his decision, in which his Honour found for the plaintiffs thus holding that the seizure and detention of the Vessel was unlawful. His Honour said:

"...There was no failure to comply with an order to bring the vessel to (sic) for boarding. As such the vessel was not forfeit (sic) and there he (sic) was not liable to be seized as such the seizure and detention is unlawful.

8. The defendants appealed against Sheehan, J’s decision but it was discontinued on 30 September 2002, after the plaintiff filed an application to dismiss the appeal for want of prosecution.

9. The claim in these proceedings is based on the decision given by Sheehan, J. in OS 39 of 2000 (in which his Honour declared that the seizure and detention of the Vessel was unlawful). These proceedings were commenced on 22 October 2002. It is to be noted that the claim is made pursuant to s. 2 (1) of the Claims By and Against the State Act, 1996, (‘CBAS Act’) against the second defendant for the actions of its servants or agents, viz. the first defendants, for the unlawful seizure and detention of the Vessel.

10. In the Statement of Agreed and Disputed Facts, the parties agreed inter alia, that the first defendants were and are servants or agents of the second defendant. The parties also agreed that on 24 June 2000, the Customs Officers returned the Vessel in good condition to Trevor Yuskan following the Order of the National Court, given on 20 June 2000 in OS No. 39 of 2000. The parties also agreed that on 10 May 2000, the plaintiffs gave notice to the State pursuant to s. 5 of the CBAS Act of their intention to commence these proceedings and to make claims against the State which is the second defendant.

General comments

11. As I said, the plaintiffs’ claim is made pursuant to s. 2 (1) of the CBAS Act, which provides:

2. Suits against the State.

(1) A person making a claim against the State in contract or in tort may bring a suit against the State, in respect of the Claim, in any court in which such a suit may be brought as between other persons.

12. The plaintiffs have conceded that there was no personal service of the notice of these proceedings on Waliya Abilo who is a defendant and a Customs Officer, as required under s. 140 of the Customs Act.

The issues

13. There are two issues to be determined. First is whether the plaintiffs’ failure to personally serve Waliya Abilo with the notice of these proceedings as required under s. 140 of the Customs Act, is fatal to their claim. Second is whether the plaintiffs did suffer loss and damages. The second issue would only arise if the answer to the first issue is in the affirmative.

14. It is necessary to set out s. 140 of the Customs Act. The section provides:

140. Notice of proceedings against the officers.

(1) Subject to Subsection (5), proceedings shall not be commenced against an officer for anything done in execution of his office, or by reason of his office, until one month after written notice is delivered to him or is left at his usual place of abode, by the plaintiff, his attorney or agent.

(1) A notice under subsection (1) shall state clearly –

• (a) the cause and nature of the proceedings; and
• (b) the court in which it is intended to take the proceedings; and
• (c) the name and place of abode of the plaintiff; and
• (c) if the notice is delivered by the attorney or agent of the plaintiff - the name and place of business of the attorney or agent.
  

(3) A notice under Subsection (1) is not invalid by reason of any defect or inaccuracy in it unless the court is of the opinion that the defect or inaccuracy would prejudice the defendant in his defence.

(4) In a case to which Subsection (3) applies, the court may give leave to amend the notice as it thinks just.

(5) This section does not apply where a Judge gives leave to the plaintiff to proceed without notice.

(6) Leave under Subsection (5) may be given on such terms as the Judge thinks proper.

15. Section 141 is also relevant for the purposes of the notice under s. 140.

16. The section is therefore also set out below.

141. Evidence in proceedings on Notice.

In any proceedings taken on notice under Section 140 (1), the plaintiff –

(a) shall not advance evidence of any cause of action that was not distinctly stated in the notice; and
(b) is not entitled to a verdict unless he proves on the trial that the notice was duly served.

Submissions

(1) Plaintiffs’ submissions.

17. Mr Shepherd submitted that s. 140 of the Customs Act is irrelevant, hence the requirement to effect personal service of notice of these proceedings on Waliya Abilo. This is because the plaintiffs are not making claims against him personally.

18. Mr. Shepherd told the Court that these proceedings are being brought pursuant to s. 2 of CBAS Act, against the second defendant, for the actions of its servants and agents viz. the first defendants. The claim against the defendants is based on the decision made by Sheehan, J. in OS No. 39 of 2000, which Mr. Shepherd submitted had effectively determined the issue of liability in these proceedings.

19. In that regard, it is to be noted that the defendants do not dispute that the notice to claim against the State under s. 5 of CBAS Act, was duly given by the plaintiffs on 10 May, 2000. It is further noted from Ms. Nablu’s submissions - "that the defendants do not deny that the seizure was not proper and not within the meaning of Customs Act pursuant to the decision of the Court in OS No. 39 of 2000."

20. Thus, on the basis of this concession by the defendants, Mr Shepherd argued that, there cannot be an issue that actions of the first defendant had resulted in damage and loss being suffered by the plaintiffs. In other words, the defendants have impliedly admitted liability, thus settling the issue of liability.

21. It was therefore argued that the only issue for the Court to determine is loss and damages for the plaintiffs and whether in the circumstances of the case, the plaintiffs had the duty to mitigate their damages.

22. On the issue of damages, the plaintiffs rely on the affidavit by Trevor Yuskan, sworn on 20 March, 2006.

23. The plaintiffs’ claim is made under four heads;

(i) loss of profit;
(ii) legal costs;
(iii) out of pocket expenses; and
(iv) exemplary damages.

(i) Loss of profit.

24. According to Trevor Yuskan’s affidavit, the Vessel could have earned income at the rate of AUD $40,000.00 net per month. The plaintiffs’ estimated income is for three months from March to June, 2000. The Vessel was released to the plaintiffs on 24 June, 2000, following orders given by Sheehan, J in proceedings OS 39 of 2000. Thus, the total amount claimed for lost revenue is AUD$120, 000.00. The plaintiffs say that had the Vessel not been unlawfully detained, it would have had its fittings completed at Motukea dockyard before the start of the shark fishing season in March, 2000, and would have carried on its fishing business.

25. The plaintiffs therefore claim AUD$120,000.00 under this head.

(ii) Legal costs.

26. The plaintiffs claim legal costs which they say were incurred both in Papua New Guinea and Australia, first to retrieve the Vessel and secondly, to prosecute the current claim. For this, reliance is placed on the material in Annexure ‘C’ to Trevor Yuskan’s affidavit. These are costs incurred prior to the commencement of these proceedings. The costs are said to have been incurred from 6 December, 1999 to 31 May, 2002, and they appear to have been costs paid to legal firms in Port Moresby and Australia.

27. The plaintiffs claim under this head is based on Annexure ‘C’ to Trevor Yuskin’s affidavit and the amount claimed is AUD$45,000.00.

(iii) Out of pocket expenses.

28. For this claim, reliance is placed on the material in Annexure ‘D’ to Trevor Yuskan’s affidavit. The period for this claim is from 16 November, 1999 to 19 March, 2001. The claim is for fuel, cash transactions, air fares, wages and accommodation.

29. The plaintiffs claim under this head is put at AUD$14,340.50.

(iv) Exemplary damages.

30. Again, for this claim, reliance is placed on Trevor Yuskan’s affidavit, particularly paragraphs 9, 10, and 11 and Mr. Shepherd’s affidavit, sworn on 10 March, 2006. Paragraph 9 of Trevour Yuskan’s affidavit states that because of the unlawful seizure of the Vessel, it could not undergo its refit at the Motukea dockyard; that such refit would have increased its freezer capacity; and that the Vessel was forced to return to Australia without its refit in order to mitigate its loss. Paragraph 10 states that, the plaintiffs incurred substantial expenses as a result of the unlawful seizure; that even after the defendants’ failure to prosecute their appeal against the decision of Sheehan, J in OS 39 of 2000, which declared the actions of the defendants "in complete breach of the Customs Act", the defendants showed no remorse and never apologized to the plaintiffs for causing inconvenience to them and for their loss of revenue. Paragraph 11 states that, had it not been for the actions of the defendants, more vessels would have travelled to Port Moresby to under go refitting and other maintenance at the Motukea dockyard.

31. Mr. Shepherd told the Court that instead of accepting the decision by Sheehan, J. in OS 39 of 2000, the defendants filed an appeal against the decision and applied for the stay of the orders given by Sheehan, J. The appeal was discontinued only after the plaintiffs’ application to dismiss the appeal for want of prosecution was listed for hearing. The appeal was discontinued one year three months after Sheehan, J gave his decision in OS No. 39 of 2000.

32. It was submitted that although the plaintiffs do not claim that the Vessel or its contents were damaged whilst the Vessel was detained, it is claimed that the actions of the Customs Officers had aggravated the plaintiffs’ damages, particularly when they were unlawfully deprived of doing business.

33. Mr. Shepherd submitted that such actions by the defendants justify this Court in awarding exemplary damages. Mr. Shepherd cited two cases in support of this contention, first is Toglai Apa and Ors v The State [1995] PNGLR 43; second is Banz Kofi Fektori Pty Limited v. Raymond Simon Apup N2374 and Commissioner General of Internal Revenue Commission v Julian Paul Leech (1998).

34. In Toglai Apa and Ors v. The State, the plaintiffs claimed exemplary damages following a police raid during which houses were set on fire. In that case, Sheehan, J whilst considering exemplary damages held that in the circumstances of the case, general and aggravated damages should be awarded as compensation for actual loss, actual inconvenience or actual injury.

35. In Banz Kofi case, the defendant made a false promise to the plaintiff that if the plaintiff lent him K1, 500.00, he (the defendant) would go and buy 20,000 kgs of cherry coffee and deliver them to the plaintiff. It was agreed between the parties that the defendant would buy such quantity of cherry coffee for the plaintiff over a period of time. It was estimated that with 20,000 kgs of cherry coffee, the plaintiff could earn K6, 000.00. The defendant had a Toyota 6000 Tipper truck which he said he would use to collect cherry coffee. The defendant failed to honour his promise and never bought the coffee for the plaintiff. The plaintiff sued for damages. The Court held that the wilful false promise made by the defendant to deliver 20,000 Kgs of cherry coffee was calculated and designed to deceive the plaintiff to give him the K1, 500.00 and it constituted aggravated damages.

36. The plaintiffs’ claim under this head is put at K50, 000.00.

37. As to the duty to mitigate their damages, the plaintiffs agreed that they did have such duty and that they said was the reason why the Vessel departed Papua New Guinea as soon as it was released by the Customs and when it was able to do so. The Vessel also immediately resumed fishing even without its refit until the following "off season" when the refit was done in Australia.

(2) Defendants’ submissions.

38. Ms. Nablu submitted that the plaintiffs had failed to comply with the fundamental requirement under s. 140 of the Customs Act, which was for them to personally serve notice of these proceedings on Waliya Abilo who is a defendant in these proceedings. It was submitted that as a result of such failure, s. 141 (b) would operate as a bar to any verdict being given in favour of the plaintiffs. For this argument, reliance was placed on the unreported decision by Sakora, J. in Port Moresby Enterprises Pty Ltd v. Ainui Diole and Ors (2002), in which his Honour discussed application of s.140 of Customs Act and s. 5 of the CBAS Act. In that case, the Court pursuant to s. 139 of the Customs Act dismissed the action, holding that there was a reasonable cause for the seizure. His Honour said;

"...Section 139 of the Customs Act provides immunity from any legal action against a person for any seizure under the Act. This bar to any proceedings operates so long as there was reasonable cause for the seizure. This provision is located in that part of the Act headed Protection of Officers. Located there also is s. 140...

...There is no dispute that the State Officers named as defendants (Nos. 1 to 4) were never given notice of these proceedings against them as required by s. 140 (supra). And as the Independent State of Papua New Guinea is a defendant in both writs, any proceedings contemplated against it must comply with the express and mandatory requirements of s. 5 Claims By and Against the State Act, (sic)...

...There is no suggestion that the defendants ever considered the need to comply with a requirement such as envisaged by s.5 (supra). There is abundant case law in this jurisdiction enforcing and emphasizing the mandatory nature of the provision.

Thus, even if the Court were persuaded to declare the search warrant, the search and the seizure all illegal and unconstitutional, the two proceedings here would be dismissed for want of compliance with the provisions of ss. 139 and 140 Customs Act (sic), and s. 5 Claims By and Against the State Act (sic)".

39. As noted earlier in the judgment, the defendants have conceded that the seizure of the Vessel was not proper and not within the meaning of the Customs Act. However, it was argued by Ms. Nablu that the seizure was only partial because the plaintiffs were permitted to remain on the Vessel from the time the Vessel was seized on or about 6 December, 1999 to 24 June, 2000, when the Vessel was returned to the plaintiffs.

40. As regards the claim for damages by the plaintiffs, Ms. Nablu argued that the plaintiffs have not proved them. She argued that the material in Trevor Yuskan’s affidavit is insufficient to substantiate the claims. She further submitted that the material in Mr. Shepherd’s affidavit cannot assist the plaintiffs’ case. She argued that there should be independent corroborative evidence viz, evidence other than those deposed in the affidavits of Mr. Yuskan and Mr. Shepherd, to prove that the plaintiffs did suffer loss and damages. For this argument, reliance was placed on Graham Mappa v. Papua New Guinea Electricity Commission [1995] PNGLR 170. In that case, the court said that where loss of business is claimed the plaintiff would need to produce proper business records such books of Account, bank statements, declarations of profits, Tax Returns and so forth to prove such claims. Ms. Nablu argued that the Profit and Loss Statement deposed to in Trevor Yuskan’s affidavit should also be supported by such evidence. She submitted that what is before the Court is purely speculative, thus it leaves the Court in a position where it cannot properly determine the loss suffered by the plaintiffs, if any. Ms. Nablu therefore submitted that the claim should be dismissed.

41. As regards the claim for exemplary damages, Ms. Nablu submitted that for such claim to succeed, the plaintiffs must show that there was actual malice or bad faith on the part of the first defendants. She said, there is no evidence of such conduct by the first defendants. For this, she relied on Pike Dambe v. Augustine Peri and the Independent State of Papua New Guinea [1993] PNGLR 4 where at 12 Amet, J. (as he then was) said:

"Exemplary damages also has a compensatory element. It is intended to punish the defendant and also to serve as moral retribution and deterrence. It serves to exact retribution for oppressive, arbitrary or unlawful action by the servants of the Government. It also manifests the intention to deter the defendant and others who might act similarly from repeating the behaviour."

42. Ms. Nablu emphasized that there was no malice or bad faith in the conduct of the Customs Officers, including Waliya Abilo that should attract exemplary damages. She said the evidence is that the Customs Officers treated the plaintiffs well and the Vessel was well cared for and was returned to the plaintiffs in good condition. The plaintiffs also had no complaints about the condition of the Vessel when it was returned to them. She argued that there is nothing at all in the conduct of the Customs Officers which can justify exemplary damages. She therefore submitted that this claim should also be dismissed.

43. As regards the claim for legal costs, Ms Nablu submitted that it should also be dismissed for two reasons. First, in OS 39 of 2000, Sheehan, J. refused to award costs. This is confirmed by the copy of the judgment which is attached as Annexure ‘A’ to Mr Shepherd’s affidavit. It was therefore submitted that, if this Court was to award costs for those proceedings, it would at least be in direct conflict with the approach taken by this Court in OS No. 39 of 2000. Secondly, as regards costs for the other proceedings or legal costs arising out of other matters, this Court has no power to award costs as they do not relate to these proceedings.

Reasons for decision

44. The plaintiffs have conceded that they have not complied with the requirement under s. 140 of the Customs Act, in that Waliya Abilo was not served personally with the notice of these proceedings. That being the case, s. 141 (b) would ordinarily operate as a bar to these proceedings. In this regard, I find that the case of Port Moresby Enterprises Pty Ltd v. Aindiole and Ors (supra) which Ms. Nablu relied on to press the point that these proceedings are barred by s. 141 (b) would appear to have no application and relevance to the instant case, because that case discussed the application of s.139 which operates to provide immunity to persons effecting seizure for a reasonable cause. The case before me on the other hand attracts the application of s.141 (b) as a bar to any proceedings for failure by the plaintiffs to effect personal service of the notice of these proceedings on Waliya Abilo as required under s.140.

45. But s.141 (b) can only be invoked by the defendants if these proceedings were brought against Waliya Abilo personally, in which case s. 141 (b) would render the proceedings null and void. That is not the case here because the plaintiffs’ claim is against the second defendant viz. the State, based on the decision given by Sheehan, J. in OS 39 of 2000, on 20 June, 2000, in which his Honour declared that Waliya Abilo and other Customs Officers who were servants and agents of the second defendant, had acted unlawfully in seizing and detaining the Vessel. So the s.140 requirement does not arise at all here as an issue and it is clearly irrelevant.

46. Also s.140 requirement would only arise if liability was still an issue. Here, the issue of liability had in my view been settled by the decision given by Sheehan, J in OS 39 of 2000, and further, by the concession made by the defendants that actions of the Customs Officers, including Waliya Abilo were not proper and not within the meaning of the Customs Act.

47. No issue as to the competency of the proceedings arises as regards the plaintiffs’ claim against the State, because the required notice under s.5 of the CBAS Act, had been duly given.

48. The assertion by the defendants that seizure was not complete because the plaintiffs were allowed to stay on board the Vessel after its seizure does not ‘hold water’. Such assertion is in my view made in an attempt to justify them raising the s. 140 requirement in their defence. As I said, the concession by the defendants that the seizure of the Vessel was not proper and that it was not done within the meaning of Customs Act, effectively means that they had agreed that the seizure and detention of the Vessel was unlawful as found by Sheehan, J. That is fatal to them. It follows that the only issue I have to determine is damages and loss for the plaintiffs, which I will now do.

49. It should be noted at this juncture that the defendants’ defence to the plaintiffs’ claim is centered around their claim that s. 140 requirement was not complied with by the plaintiffs and that the seizure of the Vessel was only partial and that the Vessel was returned to the plaintiffs in good state. 50. The defendants did not challenge the evidence adduced by the plaintiffs through Trevor Yaskan upon which the plaintiffs base their claim for damages. Indeed the evidence was allowed by the defence to be received and considered by the Court and the case was fought only on affidavit evidence from both sides. Such being the approach taken by the defence, it cannot turn around and ask the Court to disregard the same evidence which it has not objected to and which it has allowed the plaintiff to rely on. I will therefore now determine the plaintiffs’ claim for damages based mainly on Trevor Yaskan’s affidavit material.

Damages

(i) Loss of profit.

51. The plaintiffs have put their total loss under this head at AUD$120,000.00. This is for three months at AUD$40,000.00 per month from March to June 2000. For this, reliance was placed on Trevor Yuskan’s affidavit. The affidavit gives Statements of Profit and Loss for another vessel, Felix the Cat for the period from 1999 to 2004. This was another Australian registered shark fishing vessel which had similar capacity as the Vessel with freezers, and it worked in tandem with the Vessel. The figures were prepared by Trevor Yuskan. The amount of AUD$40,000.00 per month is based on the net income for Felix the Cat for the three months from March to June 2000. The Vessel had no freezer at the time of its seizure. It is therefore impossible to determine with certainty as to how much the Vessel would have made in those three months.

52. Ms. Nablu contended that the plaintiffs needed to produce some other independent evidence such as books of Account, invoices, Tax Returns, receipts and so forth, for the Court to determine with certainty the amount for this head of claim. She submitted that the material in Trevor Yuskan’s affidavit is insufficient and too remote for the Court to use to realistically assess the damages claimed. The contention has merit because the plaintiffs bear the onus to prove their claims.

53. However, there is no doubt that the claim is valid and that the plaintiffs did suffer loss. I therefore have to do the best I can to determine the plaintiffs’ loss. In this regard, I do not think the material evidence in Trevor Yuskan’s affidavit should be totally disregarded. He deposed in paragraph 5 of his affidavit that the Vessel is now able to earn AUD$60,000.00 per month after its freezers were installed. This has not been challenged in any way by the defendants. From this, it is in my view reasonable to say that the Vessel would have made AUD$180,000.00 in three months from March to June, 2000, in the normal course of its business. Here, the plaintiffs are claiming AUD$120,000.00, for the three months. This is based on Felix the Cat’s capacity. Thus, the claim for AUD$$120,000.00 is AUD$60,000.00 less than the Vessel’s current capacity of earning AUD$180,000.00 for three months. I am of the view that the concession of AUD$60,000.00 by the plaintiff to claim for the lesser amount of AUD$120,000.00 sufficiently allows for the plaintiffs not adducing other supporting evidence for the claim, such as receipts, invoices, Tax Returns and so forth. With the concession of AUD$60,000.00, by the plaintiffs, I do not consider the claim of AUD$120,000.00 unreasonable.

54. I therefore award AUD$120,000.00 in damages for loss of profit.

(ii) Legal costs

55. This claim is based on Annexure ‘C’ to Trevor Yuskan’s affidavit. These are in my opinion matters or costs which the plaintiff should have claimed elsewhere and not in these proceedings. It is an abuse of process to use these proceedings to claim costs which arose elsewhere. In this regard, I note that in OS No. 39 of 2000, Sheehan, J. did consider the issue of costs and refused to order costs. The Supreme Court also considered the issue of costs and awarded costs against the defendants, when it dismissed the defendants’ appeal against Sheehan J’s decision in OS No. 39 of 2000. This Court likewise only has the power to order costs in respect of these proceedings.

56. This claim is therefore dismissed.

(iii) Out of pocket allowances

57. The claim is based on Annexure ‘D’ to Trevor Yuskan’s affidavit. The amount claimed is AUD$14,340.00. The claim is comprised of air fares, accommodation, wages for the crew, fuel and cash. The period for which the claim is made is from 16 November, 1999 to 19 March, 2001. Claims or amounts allowed here must be reasonable and should be limited to the period in which the Vessel was unlawfully seized and detained by the Customs Officers. Thus the relevant period is from 6 December, 1999, which is when the Vessel was detained to 24 June, 2000, which is the date the Vessel was returned to the plaintiffs. I will allow the period to be extended to 30 June, 2000, to allow for the extra days the Vessel would have taken to leave Papua New Guinea. According to Annexure ‘D’ to Trevor Yuskan’s affidavit, the total expense for the period is AUD$10,229.43. No details are provided for these expenses. As to the claim for accommodation, the evidence in Waliya Abilo’s affidavit is that the plaintiffs were allowed to stay on board the Vessel during its detention, which is from 6 December, 2000 to 24 June, 2001. But that is contradicted by the Statement of Agreed and Disputed Facts by the parties because paragraphs 14 and 15 of the Statement, which are agreed facts, state that Mr. Lee and Mr. Wren stayed on board the Vessel until 10 December, 2000, when Mr. Lee left Papua New Guinea. Mr. Wren continued to stay on board the Vessel until 24 January, 2001, when he vacated the Vessel. From then on, the PNG Defence Force Naval Officers kept the Vessel at Lancorn Naval Base. This means, Mr. Wren had to find alternative accommodations from 24 January, 2001 to 24 June, 2001.

58. In the absence of any evidence to the contrary, I am entitled to assume that Mr. Wren would have provided his own accommodation in Port Moresby in that period, while awaiting the release of the Vessel. I should allow a reasonable amount for Mr. Wren’s accommodation for this period. Given the high cost of accommodation and other living expenses in Port Moresby; for a period of five months; I consider that amount of half the amount claimed would be reasonable for this claim. Such amount sufficiently allows for the apparent lack of other supporting evidence. I will therefore allow amount of AUD$5,000.00 from AUD$10, 229.43 claimed.

59. I therefore award AUD$5,000.00 in damages under this head.

(iv) Exemplary damages

60. For this claim, the plaintiffs relied on paragraphs 9, 10 and 11 of Trevor Yuskan’s affidavit. The matters raised in these paragraphs relate to the conduct of the defendants, which the plaintiffs say justify this Court in awarding exemplary damages. These matters have already been highlighted. Mcgregor on Damages (15th ed, 1988) at p 254, describes exemplary damages as:

"The primary object of an award of damages is to compensate the plaintiff for the harm done to him; a possible secondary object is to punish the defendant for his conduct in inflicting harm. Such a secondary object can be achieved by awarding, in addition to the normal compensatory damages, damages which are variously called exemplary damages, punitive damages, vindictive damages, even retributory damages, and comes into play whenever the defendant’s conduct is sufficiently outrageous to merit punishment, as where it discloses malice, fraud, cruelty, insolence or the like.".

61. Mcgregor on Damages (12th ed, 1961) at p 196, concludes the above passage with: "...or, as it is sometimes put, where he acts in contumelious disregard of the plaintiff’s rights." This phrase was adopted by Taylor, J in Uren v. Fairfax & Sons Pty Ltd [1966] HCA 40; (1966) 117 C.L.R. 118 at 129. The passage was later cited by the High Court in Lam v Cotongo [1987] HCA 47; (1987) 164 CLR 1, when discussing the observations made by Lord Devlin in Rookes v Barnard [1964] UKHL 1; [1964] AC 1129, which is a leading common law case on exemplary damages.

62. In the case of Markryllos and Another v George Laurens (NT) Pty Ltd [1992] 111 FLR 204, Kearney, J in following Rookes v Barnard, at 210 said:

"So the distinction lies in this: aggravated damages – more accurately, damages for aggravated damages – are compensatory nature, while exemplary damages are punitive."

63. Thus, it is clear that aggravated damages are different from exemplary damages. However, in practice, both damages are determined jointly under exemplary damages and the amounts for each claim are analytically fixed as a single sum for exemplary damages. This point was made by Bray, CJ in Johnson v. Stewart [1968] SASR 142 when his Honour at 144 said:

"...I do not think it would be right to award one sum as aggravated damages and another as exemplary damages, one sum as enough to compensate the plaintiff for humiliation and outrage, and another sum as a sort of fine to express moral disapprobation of the defendant. Rather these are two elements to be taken into account in fixing one sum." (my underlining).

64. His Honour went on to say:

"Conversely I suppose cases are conceivable where the Court can and should express disapprobation of the defendant’s conduct by an award of exemplary damages even though the plaintiff’s feelings are not outraged."

65. In this case, the Customs Officers acted in breach of the Customs Act when they unlawfully detained the Vessel which resulted in the plaintiffs losing revenue. The actions of the defendants through their servants or agents became more critical when they applied to stay the orders given by Sheehan, J in OS 39 of 2000 after they appealed Sheehan, J’s decision, but then they on 30 September, 2002, discontinued the appeal, after the plaintiffs’ application to have the appeal dismissed for want of prosecution was listed for hearing. Thus, there is a serious question as to whether the appeal was lodged in good faith. In my opinion, such actions by the defendants attracted malice and thereby aggravated the plaintiffs’ damages. The plaintiffs were unnecessarily made to suffer loss of revenue and mental distress. I note that the Vessel was released to the plaintiffs on 24 June, 2000, but the appeal remained on foot until 30 September, 2002, only to be discontinued. And the decision to discontinue the appeal appears to have been prompted by the plaintiffs’ application to have the appeal dismissed for want of prosecution.

66. The effective period in which the plaintiffs were unlawfully deprived of doing business was from 6 December, 2000, to 24 June, 2001. Then for a further period of about one year three months from 24 June, 2001 to 30 September, 2002, the plaintiffs were made to worry unnecessarily about the appeal. These clearly in my view seriously aggravated the plaintiffs’ damages, thus justifying punitive or exemplary damages against the defendants.

67. The plaintiffs have claimed K50, 000.00 under this head. I remind myself that the award of exemplary damages should not be as high as if the conduct of the Customs Officers was criminal in nature. The general rule is that in civil wrongs, the weapon should be used with restraint and that damages awarded should be moderate. Nonetheless, there must be a balance in awarding damages under this head so that damages awarded would also have the punitive effect with an element of deterrence. In my view, where there are such serious aggravating factors present in the conduct of a defendant, as in this case, there should be an exception to the rule so that the amount of damages awarded sufficiently and appropriately reflect such conduct. What is a moderate amount would depend on the facts of a particular case. In this case I consider the clear breach of the Customs Act, by the defendants in unlawfully detaining the Vessel, which resulted in the plaintiffs being denied to do business of commercial fishing for a period of six months from 6 December, 1999 to 24 June, 2000, a serious aggravating factor. Then the stay order obtained by the defendants against the order of the National Court which remained on foot for a further one year three months only to be discontinued on 30 September, 2002 was also a serious aggravating factor. In my opinion, such conduct by the defendants justify an amount of damages that is higher than a moderate figure.

68. In these circumstances, and having regard to the authorities cited above, I consider that the fair amount for damages under this head should be K20, 000.00. I note that the plaintiffs did mitigate their loss by immediately departing for Australia after the Vessel was released to them on 24 June, 2000 even without its fittings and resumed fishing. I have taken that into account. Thus, for this claim, I award K20, 000.00.

96. The plaintiffs have claimed interest at 8 percent. The rate at which an interest may be awarded is discretionary. I consider 8 percent interest appropriate given that the plaintiffs’ business was affected and they lost revenue all because of the defendants’ unlawful actions. I will therefore award 8 percent interest on the damages awarded.

97. The plaintiffs have claimed damages at the Kina rate of .4168 (Post Courier 2nd August, 2006) with 8% percent interest. The amount of damages awarded in Australian Dollars is $120,000.00 for Loss of Profit and $5, 000.00 for Out of Pocket Allowances, altogether to the sum of AUD$125, 000.00. Converting this amount to Papua New Guinea Kina using the .4168 exchange rate, it comes to K299, 904.03. I will add K20, 000.00 for exemplary damages. Thus the total amount awarded to the plaintiffs in damages is K319, 904.03.

98. The period of interest is from 22 October, 2002 which is the date when the writ was filed to the date of judgment which is today (15 December, 2006). That is a period of 4 years 1 month 3 weeks. For this I calculate the interest at K106, 101.48. I therefore award K106, 101.48 in interest. Thus the total amount awarded in damages and interest is K426, 005.51.

99. The defendants will pay the plaintiffs’ costs.

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Blake Dawson Waldron Lawyers: Lawyers for the plaintiff
Internal Revenue Commission Lawyers: Lawyers for the defendants