|
|
Home
| Databases
| WorldLII
| Search
| Feedback
National Court of Papua New Guinea |
PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]
WS 1443 OF 2004
BETWEEN:
XANTIC B.V
(A.R.B.N. 092 596 480)
Plaintiff
AND:
GOBE BUSINESS DEVELOPMENT
COMPANY LTD trading as GOBE FIELD
ENGINEERING LTD
Defendant
Waigani: Davani, .J
2006: 4, 13 October
Counsel:
R. Diweni, for the plaintiff
A. MacDonald, for the defendant
RULING
13 October, 2006
1. DAVANI .J: Before me are two motions filed by both the plaintiff and the defendant which I heard and reserved for ruling. These are;
1. Notice of Motion filed by Posman Kua Aisi Lawyers on 7 August, 2006 for and on behalf of the defendant (‘PKA’s motion’).
2. Notice of Cross-Motion filed by Blake Dawson Waldron Lawyers on 17 January, 2006, for and on behalf of the plaintiff (‘BDW’s motion’).
Application and evidence
2. PKA’s motion seeks leave to further amend the defendant’s amended Defence. BDW’s motion seeks to have summary judgment entered against the defendant and for the defendant’s amended Defence filed on 23 May 2006, to be struck out. The application is made pursuant to O. 8 R. 50 (1) and O. 12 R. 38 of the National Court Rules (‘NCR’) respectively.
3. The plaintiff carries on the business of providing global satellite communications and related services to its customers. The defendant admits the plaintiff provided these services from January 2003 to February, 2004, but denies that it owes the amount of AUD $235,523.53. The defendant issued a Notice to Produce dated 16 November 2004, requesting to inspect "the monthly invoices for each of the satellite accounts numbered 516892 and 534479." After inspection, ocuments ents revealed claims of AUD$31,015.31 and AUD$12,805.96, a total of AUD$46,821.27.
| i. | 16.5.03 | K11,699.06 |
| ii. | 3.2.04 | K25,698.88 |
| iii. | 9.8.04 | K23,803.86 |
| | | K61,201.80 |
4. The plaintiff claims these are admissions of liability and that on that basis, the court should strike out the amended Defence and enter summary judgment for the plaintiff in the amount of AUD $225,523.53, interest and costs.
5. Additionally, the plaintiff submits the defendant’s representatives also made admissions of liability in their emails to the defendant’s representatives, copies of which emails are before me.
6. But the defendant submits that the plaintiff failed to provide monthly invoices for services rendered, as agreed. The telephone and GAN services were used in a remote on site location in Gobe and intended to be used only for business purposes. The defendant submits that the only method of monitoring the use of the services against personal use and overuse was to receive regular invoices. And the defendant had budgeted for the use of both services at AUD $5,000.00 per month. The defendant submits that the plaintiff’s failure to provide monthly invoices and in particular for GAN services, meant the defendant was unable to monitor use of the services and was denied the opportunity to either restrict or cancel the use of the services.
7. In making these submissions, the defendant relies on a written agreement for use of the said services titled "Xantic Terms and Conditions for Inmarsat services." (‘Agreement’) Article 3.2 of the Agreement states;
"Xantic shall render monthly invoices in arrears to the "customer for the services and the customer hereby agrees to pay the charges for the services".
8. The plaintiff however denies the existence of the Agreement, that even if there was an agreement, that it was never signed. The plaintiff submits that it has its own standard terms and conditions which form part of the application forms for the plaintiff’s services.
9. In relation to the admissions contained in the defendants representatives emails and payment of monies owing by the defendant, the plaintiffs submit that this is clear acceptance by the defendant of the debts it owes to the plaintiff. But the defendant pleads in its amended Defence and affidavit material filed that the plaintiff allowed these charges to accumulate for an excessive period without ensuring the invoices for services were either brought to the defendants attention or the service discontinued and the defendant to its detriment, continued to use the services without knowledge of the accumulating charges. The defendant pleads and submits that the defendant is estopped from claiming for the period which it failed to act as required.
10. Additionally, the defendant pleads and submits that the plaintiff, by its email to the defendant dated 30 January, 2004, advised that its services were "suspended and globally barred". The defendant submits and pleads that any services provided after January 2004 was not at the defendants request and that it is not contractually liable for the payment.
11. In its Reply, the plaintiff takes issue with the matters raised in the defendants amended Defence and specifically pleads that;
- although monthly invoices were raised and delivered, that the plaintiff was not bound to issue invoices strictly on a monthly basis.
- that due to a failure in the plaintiff’s automated billing system, the monthly invoices only accounted for services on the mini-terminal (regular digital plane) account but not the GAN terminal (high speed data 64K) account.
- that the plaintiff could not pick up the charges on the GAN terminal because of the failure in its computerized billing system.
- that in or about August, 2003, it became aware that services on the GAN terminal were not being billed and that it was necessary to create a new account to remedy the technical error to enable the GAN terminal to be billed.
- This was when the temporary account (no. 534479) was created which enabled the unbilled traffic from March, 2002 to August, 2003 to be billed, an amount of AUD$190,217.05, invoice no. 1021792.
12. Which then takes me to application and submissions by the defendant seeking leave to further amend its Defence and to file a Cross-Claim. In his affidavit sworn and filed on 2 October, 2006, in support of that application, Alexander MacDonald, the defendants lawyer, deposes that there is a need to further amend its Defence because when the defendant paid K61,000.00, it was solely for payment of telephone services for which invoices were sent to its agent in Australia. However, the plaintiff credited these payments towards telephone and GAN services. Even before proceedings were issued, the plaintiff could not clarify why the one bill it issued, was so large. It was not until after the defendant responded to a Notice to Produce and the plaintiff’s Reply (to amended Defence) was filed, that the defendant saw the need to further amend its amended Defence. These issues were clarified in the Reply which pleaded;
"3. In relation to paragraphs 3 (b), 5 and 6, the plaintiff repeats paragraphs 2 herein and further says –
(a) The inability to pick up the charges on the GAN terminal was due to a failure in the plaintiffs computerized billing system.
(b) In or about August 2003, the plaintiff became aware that the services on the GAN terminal was not being billed and it was necessary to create a new account to remedy the technical error to enable the GAN terminal to be billed.
(c) A temporary account (no. 534479) was created, which enabled the unbilled traffic from March 2002 to August 2003 to be billed.
Invoice no. 1021792 totaling AUD$190, 217.05 for the unbilled services was raised and issued."
13. Mr MacDonald deposes and submits that the issue central to these proceedings is as to the types of consequences that arise because the invoices were not forwarded monthly, and that the further proposed amended Defence seeks to address that.
14. Furthermore, a ‘new issue’ not pleaded in the original amended Defence is that of Negligence and Estoppel. The defendant pleads that the plaintiff had a duty of care to forward invoices on a regular basis and to bring to the defendant’s attention any debts outstanding beyond thirty (30) days. By its failure to regularly send its invoices to inform the defendant of the accumulating charges, the defendant pleads that the plaintiff has breached its duty of care which has caused the loss, pleaded in the cross-claim (of AUD$34,985.60).
15. As to Estoppel, the defendant seeks leave to plead in the alternative, that the plaintiffs omission to send monthly invoices, constituted a silent representation that no charges were arising on the account, that in reliance on that representation and to its detriment, continued to use these services without knowledge of the accumulating charges. It seeks leave to plead that the plaintiff be estopped from claiming for the period it failed to act as a requirement.
16. And the defendant refers to this ‘requirement’ as article 3.2 of the plaintiffs ‘Terms and Conditions of immarsat services’ which states;
"3.2 Xantic shall render monthly invoices in arrears to the Customer for the services and the Customer hereby agrees to pay the charges for the Services".
17. The agreement (referred to earlier), is attached as annexure ‘C’ to the affidavit of Dickson Tasi sworn on 14 February, 2006, a Director of the defendant company. It is signed by a director of the defendant and dated 17 December 2003. The plaintiff’s representative has not signed.
But the plaintiffs Mark Easson at paragraph 14 of his affidavit sworn on 16 December, 2005 deposes to the plaintiffs "standard terms and conditions which form part of the application forms for the plaintiffs services"
18. Another agreement is that referred to by Steven Stewart of the plaintiff, in his email attached as an annexure to Mark Easson’s affidavit, that "Agreement and compliance to these terms and conditions were signed by Gobe on 9th February, 2002."
19. But again, reverting to the application for leave to further amend, amended Defence, Mr MacDonald submits that the inclusion of these matters will assist in resolving the issues in controversy whereas Mr Diweni submits, the amendment is unnecessary as it is a repeat of matters already pleaded.
20. Mr MacDonald submits that the amendments sought must be granted by the court because at no time, even based on the original amended Defence and the plaintiffs claims of admissions by the defendant, did the defendant accept that it owed the plaintiff the monies claimed, notwithstanding, 3 payments were made, as opposed to the plaintiffs claim and as pleaded in Writ of Summons and Statement of Claim, that only one payment (of K10,000.00) was made. And this is all reflected in Mr Dickson Tasi’s email of 23 March, 2004, to Steve Stewart, copy of which is attached to Dickson Tasi’s affidavit as an annexure. I set out in full the text of this email;
"Dear Mr Stewart,
It is my sincere apology that I had not been able to respond earlier to the correspondence between yourself and our Sundaram of HLB Niugini, our accountants and our Trevor Cooper, who our contact person in Australia in connection to this service.
Having received the massive account around December 2003, our project manager was tasked to rectify the exorbitant cost of data and voice communication from the above service, however, he had not been able to do so up until his departure from this company towards the end of February this year.
He had informed that he had not received any statements from Xantic during the one year he was the Project Manager.
I have personally assessed the account and make comments as follows:
Based on above, it is my calculated assumption that we could have minimized the use of the service had our staff knew the extent of costs involved in using the service. Further, we could not have been in this situation had we been issued statements periodically. We are a small company and have been placed in a very disadvantageous situation with our financial accounts thrown into unexpected negative results. Our currency conversion is about 1.6 to the A$1 so you will appreciate our financial situation expressed here. We feel that Antic must accept responsibility for the excessive use of the service which had resulted in the huge financial blow to what we had anticipated.
For the very reasons given above, may I suggest and, I am willing to pay an average of $5,000 per month (which is our monthly forecast on the service) for the period January to October, 2003. I will forward this suggestion to our lawyers for further deliberation with you and find better ways of solving the issue should we not reach agreement to my suggestion above.
This email supersedes any other correspondence that may have been made by our Sandarac Srinivasan or Trevor Cooper or any other person on the settlement of the account.
Dickson Tasi
General Manager
Civpac Ltd"
(My emphasis)
21. I have also perused other emails from the defendants representatives to the plaintiffs representatives discussing amongst others, a schedule of repayment. Are these admissions sufficient to warrant the entry of summary judgment? This is an opportune time for me to then discuss the law in relation to grants of summary judgment and leave to amend Defence.
Analysis of evidence and the law
i. Summary judgment – O. 12 R. 38 is in the following terms:
"38. Summary Judgement.
(1) Where, on application by the plaintiff in relation to any claim for relief or any part of any claim for relief of the plaintiff -
(a) there is evidence of the facts on which the claim or part is based; and;
(b) there is evidence given by the plaintiff or by some responsible person that, in the belief of the person giving the evidence, the defendant has no defence to the claim or part, or no defence except as to the amount of any damages claimed,
the Court may, by order, direct the entry of such judgement for the plaintiff on that claim or part, as the nature of the case requires.
(2) Without limiting Sub-rule (1), the Court may under that Sub-rule direct the entry of judgement for the plaintiff for damages to be assessed.
(3) In this rule, "damages" includes the value of goods."
22. The law on summary judgments is well settled. The principles (of summary judgment) involved in this particular rule is succinctly set out in the Supreme Court decision in Bruce Tsang v Credit Corporation (PNG) Limited [1993] PNGLR 112. There the court said at p. 117;
"There are two elements involved in this rule:
(a) there is evidence of the facts on which the claim or part is based; and
(b) that the plaintiff or some responsible persons give evidence that in his belief there is no defence.
23. In this case, there is no issue in relation to the first element.
As to the second element, the plaintiff must show in (the) absence of any defence or evidence from the defendant that, in his belief,
the defendant has no defence. If a defence is filed or evidence is given by the defendant --- the plaintiff must show that, upon
the facts and/or the law, the defendant has no defence. The plaintiff will not be entitled to summary judgment if there is a serious
conflict on question of fact or law. Whether a case should go to trial on these issues will be determined on the facts of each case.
However, the authorities show that the summary jurisdiction should only be invoked in a clear case: See Chief Collector of Taxes v T. A. Field Pty Ltd [1975] PNGLR 144.
24. In The Reform of Civil Procedural Law, the learned author (Sir Jack J H Jacob) discusses "summary judgment" in the following way (at 182):
"The English system employs a very effective device for disposing, without trial, of cases in which there is virtually no defence. Where the defendant has entered an appearance but the plaintiff properly believes that he has no defence, the plaintiff may apply by summons for summary judgment, supported by an affidavit verifying the facts in the statement of claim and deposing to his belief that the defendant has no defence.
Thereupon unless the defendant can satisfy the Court that there is a bona fide triable issue, so that the case ought to go to trial, the plaintiff will be given summary judgment without trial."
25. The Court then proceeded to canvass the case law on these phrases. I reproduce these in full, hereunder. In Codd v Delap (1905) 92 LT510, it is said that to give liberty to sign judgment, there must be "no real substantial question to be tried". In Jones v Stone (1894), it is said that there must be "no reasonable doubt that a plaintiff is entitled to judgment". From the point of view of the defendant, it has been said that he is entitled to leave to defend if there is a "triable issue": Jacobs v Booth’s Distillery (1901) 85 LT 262. In Clark v Union Bank [1917] HCA 19; (1917) 23 CLR 5, the High Court expressed the view that leave to defend should be given to defend if there was "an arguably good defence", and in Cloverdell Lumber Co P/L v Abbott [1924] HCA 4; (1924) 34 CLR 122, Isaacs J approved a prior statement of this Court in Daly v Egan (1886) that such leave should be given "where the defendant has any plausible ground of defence." The matter is rather differently expressed by Brett LJ in Ray v Barker [1879] UKLawRpExch 31; (1879) 4 Ex D 279, where he said that leave should be given to defend if facts were shown leading to "the inference that at the trial of the action he" (ie the defendant) "may be able to establish a defence" while in Harrison v Bottenheim (1878) 26 WR 362 it was said that such leave should be given if the defendant "has shown enough to entitle him to interrogate".
26. This aspect of the judgment then concluded as follows:
From all this it appears that where there is a real case to be investigated either in fact or law, leave to defend should be given. (my emphasis)
27. Their Honours were of the view also that:
"Whatever the language various courts have used, it seems to us that the substance of the criterion to be applied is that after the matter involved has been explained to the judge there must be a real uncertainty without full argument or further investigation of the facts as to the plaintiff’s right to judgment. The granting or refusing of liberty to sign judgment being, as we have said, a matter of discretion, it is inevitable that different Judges may exercise their discretion on the same facts in different ways...."
28. In United Timbers (PNG) Pty Limited v. Mussau Timber Development Pty Limited an unreported National Court judgment No. 645 of 2nd December, 1987, King A.J said;
"The power to enter summary judgment is one to be exercised sparingly and with great care and only when it is clear that there is no triable issue between the parties."
29. In Dep International Private Limited -v- Ambogo Sawmill Pty Limited an unreported National Court judgment No. N594 of Woods, J. dated 12 June 1987, his Honour said;
"Order 12 R. 38 allows the Court to direct entry of judgment where there is evidence of the facts on which the claim or part is based and there is evidence by the plaintiff that in the belief of the person giving the evidence the defendant has no defence except as to the amount of any damages claimed."
30. The principles here are that if a defendant makes admissions sufficient to support the claim against him the plaintiff may apply for judgment based on the admissions. These admissions may be based either on formal admissions in the pleadings or on informal admissions. For the judgment to be entered under this rule the defendants admissions must be strong and unambiguous. However, judgment is not entered on admissions where serious questions of fact or law requires consideration.
31. In The Chief Collector of Taxes -v- T.A. Field Pty Limited [1975] PNGLR 144 Raine J (as he then was) said at p.146.
"The plaintiff has applied by way of notice of motion for an order under O. XVIII R. 1, namely, that he should be given leave to enter final and summary judgment in the action. In my opinion the summary jurisdiction conferred by the rule should only be invoked in a clear case. Great care should be taken not to shut out a defendant unless it is quite clear upon the facts and/or the law that he has no defence. Summary proceedings in ejectment in New South Wales under the old Rules in that State were only made use of by the Judges of the court in a very clear cases." See Burnstein v. Lynn (1) and Pearch v. Gyucha (2), where Street CJ. said;
"Jurisdiction under this order does not entitle the Court to deprive the parties of their right to proceed to a hearing before a jury if there is a serious conflict on questions of fact – and that, of course, involves not only the surrounding facts themselves, but inferences of fact to be drawn from the evidence. If there is no such serious question between the parties, then I think that this Court should exercise the power which it has to determine the matter summarily and prevent continuous litigation over a claim which has little or no substance."
32. However the procedure under O. 9 R. 30 of the NCR is separate. That is the procedure to use where there is an admission of the facts or the matters pleaded. Application could be made under that procedure to enter judgment. Such an application was made under this procedure in Samson Kai & Ors vs. State (1992) N1079 on a deemed admission for failure to admit facts and the application was refused.
33. There is support for the proposition that where a defendant admits the facts this may form the basis of an application for summary judgment. (see Dep International Private Limited v Ambogo Sawmill Pty Limited [1987] PNGLR 117).
34. In Dep International (supra) [1987] PNGLR 117 at pg. 118, Woods J. said:
"The principles here are that if a defendant makes admissions sufficient to support the claim against him the plaintiff may apply for judgment based on the admissions. These admissions may be based either on formal admissions in the pleadings or on informal admissions. For judgment to be entered under this rule the defendant's admissions must be strong and unambiguous." (my emphasis)
35. It is clear from the above line of authorities that, if a defendant either expressly or impliedly by conduct admits a claim against him, than judgment should be signed against him. In Pacific helicopters Pty Ltd v. The Department of North Solomons and The State (24/7/98) N1815, summary judgment was entered against the Defendants on the basis of an admission of the debt in communication between the parties and their lawyers.
36. In Pak Domoi Pty Limited v. Alfred Alan Daniel & Sigfred Daniel (WS 690 of 1994 unreported and unnumbered judgment of Salika J) the court ordered judgment against the Defendants for their failure to traverse each of the matters pleaded against them in the statement of claim. That was pursuant to O. 8 R. 21 and O. 9 R.30 of the NCR.
37. In this case, the plaintiff’s application for summary judgment revolves around its claim that the defendant does not have a Defence. Although it is an application for summary judgment, judgment can be entered under O. 9 R. 30. And application under O. 9 R. 30 is not before me. So I need only dwell on the issue of Summary judgment. The principles under Bruce Tsang (supra) is very clear. And as I stated earlier, there is no issue in relation to the first element. And to the second element, I have several affidavits before me which state that the defendant does not have a Defence. And the plaintiff’s submissions and evidence are that it does have a Defence. There are triable issues. The so called ‘admissions’ are not strong and unambiguous. Rather, they require further investigation on pleadings and by way of cross-examination.
38. The defendants draft of the further amended Defence based on negligence at estoppel only surfaced after it received a sealed copy of the plaintiffs Reply to its amended Defence. And the claim for negligence are pleaded in the amended Defence but not specifically pleaded as in the form of the further amended Defence, now before me, for consideration. But on my evaluation of the facts and pleadings, I find that there is a serious conflict on questions of fact. That is, there are several agreements referred to by counsel; that deponents of affidavits must be cross-examined as to whether the defendants representatives agreed to settle the outstanding costs or not. And if the plaintiffs are relying on the admissions, the admission must be ‘strong and unambiguous’. In this case, they are not because of the many uncertainties I have already pointed out.
39. I will not grant summary judgment for the reasons pointed out.
Leave to amend
40. Recently, his Honour Gavara-Nanu .J outlined in The Papua club Inc. v Nusaum Holdings Ltd. (No. 1) (2002) N2273, the general principles applied by courts when considering whether to grant leave to amend statement of claim or not. These are;
(i) where the amendment is to enable the court to determine the real question in controversy between the parties; or
(ii) where the amendment is to correct any defect or error in the proceedings; and
(iii) that such amendment will not cause real prejudice or injustice to the other party; and
(iv) that the application for such amendment is not made mala fide; and
(v) that the other party can be fairly compensated with costs for such amendment.
41. There is extensive discussion under the rule on Amendments (O.20 Rs.5-8) in ‘The Supreme Court Practice 1991’ Vol. 1, under the part on ‘amendments of writ of pleading with leave’ and ‘amendment of certain other documents’. As to the general principles for grant of leave to amend, it states at pg. 365 (20/5 – 8/6) that;
"it is a guiding principle of cardinal importance on the question of amendment that, generally speaking, all such amendments ought to be made "for the purpose of determining the real question in controversy between the parties to any proceedings or of correcting any defect or error in any proceedings".
42. And I find that the defendants must plead negligence and breach of Contract, for its claim to be properly brought to court. I will give leave to the defendants to further amend their amended defence in the form now before me. And the plaintiff can be fairly compensated in costs.
43. As to the defendants submissions that the plaintiff should specifically plead quantum meruit, I leave that for the plaintiff to consider or for the defendant to file the appropriate application. That is a matter for them.
Orders
44. These are the court’s formal orders;
1. The plaintiff’s application for summary judgment is refused;
2. The defendant’s application to further amend its amended Defence is granted, to be filed and served within 7 days from today;
3. The defendant shall pay the plaintiffs costs of the amendment, to be taxed if not agreed;
4. The plaintiff shall pay the defendants costs of application for summary judgment, to be taxed if not agreed;
5. Time is abridged to time of settlement to take place forthwith.
__________________________________
Blake Dawson Waldron Lawyers: Lawyer for the plaintiff
Posman Kua Aisi Lawyers: Lawyer for the defendant
PacLII:
Copyright Policy
|
Disclaimers
|
Privacy Policy
|
Feedback
URL: http://www.paclii.org/pg/cases/PGNC/2006/143.html