N5508

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS NO 235 OF 2006

DENNIS SESENO
Plaintiff

V

MANASUPE ZURENUOC
Defendant

CANNINGS J

Lae: 22 May 2006
Waigani: 30 June 2006

CONTEMPT – demurrer to commencement of contempt proceedings against a provincial administrator – alleged failure to satisfy a judgment debt – Claims By and Against the State Act, Sections 13 and 14 – procedures for satisfaction of judgments against a provincial government – immunity against actions for contempt of court – indication by provincial government officers that the judgment would be satisfied – whether exceptional circumstances existed to warrant commencement of an action for contempt. 

The plaintiff obtained judgment against the provincial government in a civil action based on medical negligence by a provincial government employee. Officers of the provincial government told the plaintiff's lawyer that the judgment would be satisfied soon and that funds were available to satisfy the judgment debt. However, the judgment debt remained unsatisfied after a considerable period and the plaintiff commenced contempt proceedings against the provincial administrator, the defendant, as a way of enforcing satisfaction of the judgment. The defendant brought a demurrer to the contempt proceedings based on Sections 13 and 14 of the Claims By and Against the State Act, arguing that the procedures prescribed for satisfying judgment debts had not been followed and therefore contempt proceedings could not be commenced against the defendant. The plaintiff relied on Section 14(5) which allows contempt proceedings to be brought in exceptional circumstances which, he argued, existed here. 

Held:

(1)	When a judgment debt is obtained against a provincial government in the National Court, the debt is to be satisfied in accordance with Section 14 of the Claims By and Against the State Act.

(2)	That means a certificate of judgment must be issued by the Registrar under Section 13(2) to the party in whose favour the judgment is given; that certificate must be served on the Solicitor-General; the Solicitor-General must endorse the certificate within 60 days; the endorsed certificate must be served on the Secretary for Finance who is obliged to satisfy the judgment out of funds legally available within a reasonable time.

(3)	Contempt proceedings cannot be issued against the Solicitor-General or the Secretary for Finance for failure to satisfy a judgment debt unless there has been a failure to observe the requirements of Section 14 or unless other exceptional circumstances are shown to the satisfaction of the court.

(4)	If judgment is awarded against a provincial government it is not the statutory responsibility of the provincial government or its administrator to satisfy the judgment debt. That responsibility rests with the Solicitor-General and the Secretary for Finance.

(5)	Accordingly a provincial governor cannot be guilty of contempt for failing to satisfy a judgment debt, especially if the person in whose favour judgment has been given, has not invoked the procedures in Section 14 of the Claims By and Against the State Act. 

(6)	In the present case, the plaintiff has not invoked the statutory procedures. There is no certificate of judgment under Section 13(2); the certificate has not been served on the Solicitor-General; the Solicitor-General has not endorsed it; and it has not been given to the Secretary for Finance. Therefore the provincial administrator cannot be guilty of contempt of court.

(7)	The fact that officers of the provincial government gave an undertaking that the judgment debt would soon be satisfied is inconsequential as that is not an undertaking capable of binding the provincial government or the provincial governor, it being contrary to the provisions of Sections 13 and 14 of the Claims By and Against the State Act. 

(8)	Accordingly the contempt proceedings against the provincial administrator have no prospect of success and are incompetent and therefore struck out. 

Cases cited

The following cases are cited in the judgment:

Morris Manum and Benjamin Mano v Senior Constable Dimuk Dage (2003) N2435
Otto Napi v National Capital District Commission (2004) N2797
Pansat Communications Pty Limited v Morea Vele and The State (1999) SC604
Pato v Enga Provincial Government [1995] PNGLR 469
Pupune v Makarai [1997] PNGLR 622
SCR No 1 of 1998; Reservation Pursuant to Section 15 of the Supreme Court Act (2001) SC672

DEMURRER

This was a demurrer to commencement of contempt proceedings.

Counsel

S Tedor, for the plaintiff
A Manase, for the defendant

30th June, 2006 

1. CANNINGS J: This is a ruling on a demurrer (ie an objection to competency) regarding contempt of court proceedings that have been commenced by the plaintiff against the defendant. The case raises the issue of whether a provincial administrator can be subject to contempt proceedings when a judgment is obtained against a provincial government and the judgment debt remains unpaid.

2. The plaintiff, Dennis Seseno, is a resident of Morobe Province. He went to the Boana Health Centre for treatment for an ailment. He was treated negligently by a medical orderly employed by the Morobe Provincial Government and the plaintiff lost the use of one hand. He sued the provincial government and won an award of damages in excess of K100,000.00 (WS No 1070 of 2001, judgment of Manuhu J, National Court, and Lae 20 December 2005.)

3. The defendant, Manasupe Zurenuoc, is the provincial administrator of Morobe Province. He is the chief administrative officer of the province.

4. The plaintiff obtained judgment on 20 December 2005 and has been trying for several months to get the judgment satisfied (ie paid) by the provincial government. Officers of the provincial government told the plaintiff's lawyer that the judgment would be satisfied soon and that funds were available to satisfy the judgment debt. However, the judgment debt has remained unsatisfied .

5. On 14 April 2006 the plaintiff commenced contempt proceedings against the provincial administrator, the defendant, as a way of enforcing satisfaction of the judgment. 

6. On 22 May 2006 the defendant brought a demurrer to the contempt proceedings based on Sections 13 and 14 of the Claims By and Against the State Act. This is a ruling on that demurrer. 

CLAIMS BY AND AGAINST THE STATE ACT

7. Section 13 (no execution against the State) of the Claims By and Against the State Act states:

(1)	In any suit, execution or attachment, or process in the nature of execution or attachment, may not be issued against the property or revenue of the State.

(2)	Where a judgement is given against the State, the registrar, clerk or other proper officer of the court by which the judgement is given shall issue a certificate in Form 1 to the party in whose favour the judgement is given.

8. Section 14 (satisfaction of judgment against the State) of the Claims By and Against the State Act states:

(1)	The certificate referred to in Section 13(2) shall be served on the Solicitor-General by—

(a)	personal service; or
(b)	leaving the document at the office of the Solicitor-General with the person apparently occupying the position of personal secretary to the Solicitor-General between the hours of 7.45 a.m. and 12 noon p.m. and 4.06 p.m., or such other hours as may from time to time be declared by or under the Public Services (Management) Act 1995 to be the normal public service hours o duty, on any day which is not a Saturday, Sunday or a public holiday declared by or under the Public Holidays Act (Chapter 321).

(2)	The Solicitor-General shall, within 60 days from the date of service upon him of a certificate under Section 13(2), endorse the certificate in Form 1.

(3)	Upon receipt of the certificate of a judgement against the State bearing the Solicitor-General's endorsement that judgement may be satisfied, the Departmental Head responsible for finance matters shall, within a reasonable time, satisfy the judgement out of moneys legally available.

(4)	Any payment in satisfaction of judgement may, in the absolute discretion of the Departmental Head responsible for finance matters, be made by instalments, provided the judgement is thereby satisfied within a reasonable time.

(5)	No action—

(a)	for or in the nature of mandamus; or
(b)	for contempt of court,

or otherwise lies against the Solicitor-General or the Departmental Head responsible for finance matters in respect of the satisfaction of a judgement under this Act, other than for failure to observe the requirements of Subsection (2), (3) or (4), as the case may be, or unless other exceptional circumstances can be shown to the satisfaction of the court.

THE DEFENDANTS' SUBMISSIONS

9. The defendant is the applicant for the purposes of this demurrer. Mr Manase submitted that the procedures prescribed for satisfying judgment debts had not been followed and therefore contempt proceedings could not be commenced against the defendant. The Claims By and Against the State Act applies to and protects provincial governments, in the same way that it applies to the Independent State of Papua New Guinea.

THE PLAINTIFF'S SUBMISSIONS

10. Mr Tedor relied on Section 14(5) which allows contempt proceedings to be brought in exceptional circumstances which, he argued, existed here. Mr Tedor conceded that the Claims By and Against the State Act applied to the Morobe Provincial Government. However, he submitted that the manner in which officers of the provincial government had given undertakings that the judgment debt would be satisfied constituted exceptional circumstances. He highlighted the fact that those officers, including Mr Sihil, a member of the Provincial Legal Office, had clearly indicated that funds were available and that a cheque had already been drawn to satisfy the judgment. 

THE ISSUES

11. I will determine this demurrer on the assumption that the facts as alleged by Mr Tedor are correct: undertakings were given that the judgment would be satisfied soon; the funds were available; and a cheque was prepared. 

12. In addition, it is not disputed that, in fact, the procedures set out in Sections 13 and 14 of the Claims By and Against the State Act have not been followed. The issues are legal issues:

•	Do the procedures in Sections 13 and 14 apply to provincial governments?

•	Do the provincial government or the provincial administrator have statutory responsibility for satisfying judgment debts against the provincial government?

•	Can contempt proceedings be brought against the provincial administrator for not satisfying a judgment debt against the provincial government?

•	Are there exceptional circumstances in this case?

DO THE PROCEDURES IN SECTIONS 13 AND 14 APPLY TO PROVINCIAL GOVERNMENTS?

13. Yes. The term "the State" in Section 13 includes provincial governments and arms, departments, agencies or instrumentalities of provincial governments See SCR No 1 of 1998; Reservation Pursuant to Section 15 of the Supreme Court Act (2001) SC672, Supreme Court, Amet CJ, Los J, Sheehan J, Salika J, Sakora J. In that case the Court preferred the view advanced by Injia J in Pupune v Makarai [1997] PNGLR 622 – "the State" includes provincial governments – to the opposite view of Kapi DCJ in Pato v Enga Provincial Government [1995] PNGLR 469.

14. Therefore when a judgment debt is obtained against a provincial government in the National Court, the debt is to be satisfied in accordance with Section 14. That means:

•	a certificate of judgment must be issued by the Registrar under Section 13(2) to the party in whose favour the judgment is given; 

•	that certificate must be served on the Solicitor-General; 

•	the Solicitor-General must endorse the certificate within 60 days; 

•	the endorsed certificate must be served on the Secretary for Finance who is obliged to satisfy the judgment out of funds legally available within a reasonable time.

(See generally Pansat Communications Pty Limited v Morea Vele and The State (1999) SC604, Supreme Court, Kapi DCJ, Hinchliffe J, Sheehan J; Morris Manum and Benjamin Mano v Senior Constable Dimuk Dage (2003) N2435, National Court, Sawong J; Otto Napi v National Capital District Commission (2004) N2797, National Court,	David AJ.) 

DO THE PROVINCIAL GOVERNMENT OR THE PROVINCIAL ADMINISTRATOR HAVE STATUTORY RESPONSIBILITY FOR SATISFYING JUDGMENT DEBTS AGAINST THE PROVINCIAL GOVERNMENT?

15. No. If judgment is awarded against a provincial government it is not the statutory responsibility of the provincial government or its administrator to satisfy the judgment debt. That responsibility rests with the Solicitor-General and the Secretary for Finance.

CAN CONTEMPT PROCEEDINGS BE BROUGHT AGAINST THE PROVINCIAL ADMINISTRATOR FOR NOT SATISFYING A JUDGMENT DEBT AGAINST THE PROVINCIAL GOVERNMENT?

16. No. Contempt proceedings cannot be issued against the Solicitor-General or the Secretary for Finance for failure to satisfy a judgment debt unless there has been a failure to observe the requirements of Section 14 or unless other exceptional circumstances are shown to the satisfaction of the court. It follows that contempt proceedings cannot generally be commenced against the provincial administrator.

17. The plaintiff has not invoked the statutory procedures. There is no certificate of judgment under Section 13(2); the certificate has not been served on the Solicitor-General; the Solicitor-General has not endorsed it; and it has not been given to the Secretary for Finance. Therefore the provincial administrator cannot be guilty of contempt of court.

ARE THERE EXCEPTIONAL CIRCUMSTANCES IN THIS CASE?

18. No. The fact that officers of the provincial government gave an undertaking that the judgment debt would soon be satisfied is inconsequential as that is not an undertaking capable of binding the provincial government or the provincial governor, it being contrary to the provisions of Sections 13 and 14 of the Claims By and Against the State Act. 

CONCLUSION

19. The contempt proceedings against the provincial administrator have no prospect of success and are incompetent and therefore should be struck out. 

COSTS

20. Normally costs follow the event, ie the party that loses is ordered to pay the other side's legal costs. I cannot see any reason to depart from that rule of thumb here. The contempt proceedings are misconceived.

ORDER 

21. The order of the court will be that:

1	the demurrer to commencement of the contempt proceedings against the defendant is sustained; and
2	the contempt proceedings are incompetent and are struck out; and
3	costs of the demurrer and directly related proceedings are awarded to the defendant, to be taxed if not agreed.
____________________________________________
Sialis Tedor & Associates: Lawyers for the Plaintiff	
Steeles Lawyers: Lawyers for the Defendant