Sausau v PNG Harbours Board [2007] PGNC 106; N3255 (13 April 2007)

N3255

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS NO. 717 of 2000 (JR)

BETWEEN

LAWRENCE SAUSAU
Plaintiff

AND

PNG HARBOURS BOARD
First Defendant

AND

THE INDEPENDENT STATE
OF PAPUA NEW GUINEA
Second Defendant

Waigani: Injia, DCJ
2007: 13 April

JUDGMENT NO. 2

JUDICIAL REVIEW – Application for award of interest subsequent to delivery of judgment on damages - Damages awarded upon grant of application – Claim for interest not pleaded in Statement filed under Order 16 and not awarded at time of judgment –Whether interest should be awarded on judgment sum – If so, what is the relevant period – Exercise of Discretion- Judicial proceedings (Interest on Debts and Damages) Act (Ch. 52), s 1; National Court Rules, O 16 r 7(1)(a).

Cases cited:

Attorney General Michael Gene v Hamidian-Rad [1999] PNGLR 278
Cheong Supermarket Pty Ltd v Pery Muro [1987] PNGLR 84;
MVIT v Reading [1988] PNGLR 236;
Pinzer v Bougainville Copper Limited [1983] PNGLR 436;
Re Nomination of Governor – General, Sir Pato Kakaraya (No 2) (2004) SC732;
Richard Dennis Wallbank & Jeannette Minife v The State [1994] PNGLR 78;

Counsel:

C Narakobi, for the Plaintiff
J Aisa (Jnr), for the First Defendant
No appearance for the Second Defendant

13 April, 2007

1. INJIA, DCJ: On 19 December 2006, I delivered judgement in this judicial review application in which I granted the plaintiff’s application for judicial review under O 16 of the National Court Rules (NCR) and awarded damages in the sum of K16,554.97 in unpaid termination entitlements, with costs. Damages were awarded under O 16 r 7(1)(a) because the plaintiff had included "a claim for damages" in the Statement filed under O 16 r 3. I did not award interest on damages.

2. On 30 January, 2007 the plaintiff filed this application under NCR, O 8 r 12(b) & r 3(b) and O 12 r 59, in which the plaintiff applied to vary the judgment to include an order for 8 percent interest on the judgment amount, to be calculated from the date of termination of the plaintiff’s employment to the date of judgment. The interest calculated was K13,224.40. The plaintiff also sought an order for costs in the sum of K54,076 but I rejected this claim for costs because that is a matter for the plaintiff to take up with the Registrar on taxation of costs.
   
3. The plaintiff relies on Mr Narokobi’s affidavit sworn on 29 January 2007. The first defendant contests the application and relies on the affidavit of Mr Aisa sworn on 13 February 2007.
   
4. Mr Narokobi concedes that in the Originating Summons and Statement, the Plaintiff did not plead a claim or relief or an order for interest. In his written extract of argument he says he made submission on interest at the hearing but I inadvertently did not award interest. I rejected this assertion because I could not recall such submission. Then he says his original written submission which he did not hand up to the Court included a submission for interest. As that submission was not before me, I reject whatever innuendo is implied in that submission. Then he says Mr Yalkwien who filed an affidavit for the plaintiff at the trial included in his calculations a claim for interest but I rejected this argument because the plaintiff did not pursue it in his evidence and in the verified Statement.
   
5. Mr Narokobi submits a claim for interest does not fall within the meaning of "relief" in O 16 hence when damages was pleaded as a relief in the Statement as required by O 16 r 7, interest was not pleaded. That does not mean the Court cannot award interest on damages in a judicial review application. He submits the award of interest on damages is governed by s 3 of Judicial Proceedings (Interest on Debts and Damages) Act (Ch 52) ("JP (IDD) Act). Under this provision, interest must be paid on a judgment for payment of money unless the Court otherwise orders. The appropriate rate is at 8 percent yearly and is calculated from the time when the cause of action arose to the time of judgment.
   
6. He submits it is in the Court’s inherent discretion to vary a judgment where a mistake has been made under the slip rule principle in Richard Dennis Wallbank & Jeannette Minife v The State [1994] PNGLR 78.
   
7. Mr Aisa submits the application is misconceived because the NCR under which the application is made have no application to judicial review proceedings. Order 16 provides comprehensive and exclusive procedure for judicial review proceedings: Attorney General Michael Gene v Hamidian-Rad [1999] PNGLR 278. A claim for interest is not a relief provided for in O 16. He submits even if those provisions are applicable, a final judgment which determined the merits of the claim cannot be varied: NCR O 8 r 8. He submits even under the ‘slip rule’ principle developed in this jurisdiction as summarized by the Supreme Court in Re Nomination of Governor – General, Sir Pato Kakaraya (No 2) (2004) SC732, the Court has no jurisdiction to correct a substantive mistake made in a judgment. In a case where a claim for interest was not pleaded and not advanced by the plaintiff himself or his counsel at the hearing and final judgment was given, it cannot be said that the Court made a simple slip or mistake and one which this Court can correct under the slip rule principle. To award interest after final judgment is a substantive matter which cannot be corrected under the slip rule principle.
   
8. In the alternative Mr Aisa submits if the Court rejects the above arguments, then under s 1 of JP (IDD) Act, the rate of interest payable is 8 percent per annum on the principal judgment amount calculated from the date of filing the amended proceedings to the date of judgment: Cheong Supermarket Pty Ltd v Pery Muro [1987] PNGLR 84. The period is discretionary and it varies between the date on which the cause of action arose, the date on which the proceedings were instituted or the date of service, to the date of judgment: Pinzer v Bougainville Copper Limited [1983] PNGLR 436; MVIT v Reading [1988] PNGLR 236. He submits the cause of action arose on 28 November 1996. The proceedings were filed four (4) years later on 7 December 2000. The proceedings were amended ten (10) months later on 18 October 2001. The matter was first set down for trial on 18 October 2001 and it was prosecuted in 2006 when the respondent threatened to apply for dismissal for want of prosecution. In view of the long delay in prosecuting the application, the relevant period is from the date the proceedings were amended and not from the date the cause of action arose.
   
9. There is no contest between the parties that the JP (IDD) Act applies. An award of damages under O 6 r 7(1)(a) is a judgment within the meaning of "judgment" under the JP (IDD) Act The relevant provisions are s 1 and s 3(1) which provided:
   

"s 1 Interest on certain debts and damages

(1) Subject to Section 2, in proceedings in a court for the recovery of a debt or damages the court may order that there be included in the sum for which judgment is given interest at such rate as it thinks proper, on the whole or part of the debt or damages for the whole or part of the period between the date on which the cause of action arose and the date of judgement.

(2) Where the proceedings referred to in Subsection (1) are taken against the State, the rate of any interest under that subsection shall not exceed 8% yearly...

s 3 Interest on debt under judgment or order

(1) Subject to Subsection (2) and (3), where judgement is given or an order is made for the payment of money, interest shall, unless the court otherwise orders, be payable at the prescribed rate from the date when the judgement or order takes effect on such of the money as is from time to time unpaid".

10. I accept Mr Aisa’s submission that O 16 provides a comprehensive and exclusive procedure for judicial review. However rules of NCR including O 16 must be read subject to the express provisions of any relevant statute. In this case the JP (IDD) Act is relevant.
    

11. In my view the relevant provision is s 1(2). Section 3(1) relates to the time when payment of interest ordered under s 1 takes effect in respect of unpaid judgment sum. This provision is not relevant to this case.

12. Under s 1(1) the discretion given by the phrase "the court may order there be included in the sum for which judgement is given interest" implies that interest on damages is part of or follows the judgment sum which falls on the court to consider and award at the time judgment sum is awarded. The exercise of this discretion in my view is not dependant on a party pleading it as a claim or relief in the Originating Summons or Statement filed under O 16. This does not mean an uninterested plaintiff who does not claim it in the Originating Summons and Statement and pursue it at the hearing is nonetheless awarded interest on a golden plate. The plaintiff must claim it or pursue it at the hearing or soon after judgment is given. In a case where the plaintiff in hindsight or through genuine inadvertence does not claim or pursue interest before or at the time judgment is given and claims or pursues interest soon after judgment is given, the Court, in the exercise of its discretion should not unreasonably refuse interest, even if it means varying the judgment to provide for interest. In my view it is within the inherent discretionary jurisdiction of the court to revisit the final judgment, vary it and award interest as provided by law. This discretionary jurisdiction does not come within the common law ‘slip rule’ principle but under s 155(4) of the Constitution.

13. In this case the plaintiff pursued a claim for interest promptly after realizing that he or his counsel mistakenly had not pleaded or pursued interest at the hearing. In the circumstances, I exercise the discretion under s 1(1) in his favour.
    
14. The rate of interest is provided in s 1(2) of JP (IDD) Act. It is discretionary but the maximum is 8 percent yearly. In a case where the State or an instrumentality or statutory corporation is involved, the rate is usually 8 percent yearly.
    
15. The relevant period is specified in s 1(1) of JP (IDD) Act to be from the time the cause of action arose to the date of judgment. But the appropriate period within this period for which interest may be awarded is discretionary. In my view, any delay by the plaintiff in instituting judicial relief and delay in prosecuting the proceedings are certainly relevant considerations in determining the relevant period for which interest on the judgment sum may be paid. Where a plaintiff has unduly

delayed the institution of proceedings or prosecuting the proceedings, the Court may apportion a relevant period for which interest is to be calculated and paid.

16. In the present case the plaintiff applied promptly to vary the judgment. He is entitled to interest at the rate of 8 percent.
    
17. The plaintiff has claimed interest from the date of termination to date of judgment ten (10) years. I consider a period of four (4) years taken from the date of dismissal to filing of proceedings to be a long delay in view of time limit of four (4) months prescribed by O 16 r 4(2) to commence judicial review proceedings. I would allow a reasonable period which is two (2) years.
    

18. After filing proceedings, it took the plaintiff more than six (6) years to bring the matter to trial. Time is of essence in judicial review proceedings. Indeed O 16 r 5 prescribes a time limit of 21 days from the date of grant of leave to set the application down for hearing. The plaintiff bears that responsibility.I consider the period of six (6) years to be too long a period. I allow interest for two (2) years only, taking the date of amendment of the proceedings as a guide.

19. In total I award interest at 8 percents per year for four (4) years at K14,554.97. The total interest awarded is K3,495.12. This amount is added unto the judgment sum thus bringing the total judgment sum payable inclusive of interest to K18,040.09. The judgement sum shall be varied accordingly.

20. I award cost of the application to the defendant because it is the Plaintiff’s fault in not claiming and pursuing interest at the hearing.

21. I make the following orders:

1. The judgment of the Court given on 19 December 2006 is varied to include interest at eight per cent (8%) yearly for four (4) years which is calculated at K3,495.12. The total judgment sum shall be varied to read K18,040.99.

2. The plaintiff shall pay the First Defendant’s costs of this application.

__________________________

Narokobi Lawyers: Lawyer for the Plaintiff
Allens Arthur Robinson: Lawyer for the Defendant