Juffa v Hein [2010] PGNC 200; N4267 (14 December 2010)

N4267

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS 548 OF 2010

IN THE MATTER OF THE CUSTOMS ACT

AND:

IN THE MATTER OF A PROSECUTION UNDER SECTION
168 PART XIII OF THE CUSTOMS ACT

BETWEEN:

GARY JUFFA, COMMISSIONER PAPUA
NEW GUINEA CUSTOMS SERVICE
Plaintiff

AND:

MOE HEIN, MASTER AND CAPTAIN OF
VESSEL MY UBT FJORD
Defendant

Waigani: Hartshorn J.
2010: 13th & 14th December

Whether leave to discontinue the proceeding should be given on terms – Order 8 Rules 61 and 63 National Court Rules

Facts:

The plaintiff, the Commissioner of the Papua New Guinea Customs Service, seeks declaratory relief and that the defendant be found guilty of breaches of certain sections of the Customs Act. The proceeding is a customs prosecution brought under Part XIII Customs Act. The plaintiff sought leave to discontinue the proceeding when the trial of the proceeding was to commence. The application for leave to discontinue was not opposed by the defendant subject to it being on terms. This is the decision on that application.

Held:

1. Leave is granted to the plaintiff to discontinue this proceeding on the term that the plaintiff, his officers and agents are permanently restrained from commencing or prosecuting the same or similar proceeding as this proceeding OS 548 of 2010 against the defendant.

2. The plaintiff shall pay the costs of the defendant of and incidental to this proceeding to be taxed if not agreed, pursuant to s. 175 Customs Act.

Cases cited:

Papua New Guinea cases
Nil

Overseas Cases

SCI Operations Pty Ltd v Trade Practices Commission [1984] FCA 52; (1984) 53 ALR 283
Heartlink Ltd v. Jones as Liquidator of HL Diagnostics Pty Ltd (in LIQ) [2007] WASC 254

Counsel:

Mr. J. Nalawaku, for the Plaintiff
Mr. I. R. Molloy, for the Defendant

14th December, 2010

1. HARTSHORN J: The plaintiff, the Commissioner of the Papua New Guinea Customs Service, commenced this proceeding against the defendant by originating summons. He seeks declaratory relief and that the defendant be found guilty of breaches of certain sections of the Customs Act. The proceeding is a customs prosecution brought under Part XIII Customs Act. Pursuant to s. 168 Customs Act such a prosecution may be prosecuted and proceeded with in accordance with the usual practice and procedure of the court in civil cases.

2. The proceeding was set down by consent for a 2 day trial commencing on 13th December 2010. When the matter was called on 13th December, the plaintiff moved by motion to vacate the trial dates and sought leave to discontinue the proceeding. After hearing counsel on the motion, I ordered that the trial dates be vacated and that leave be granted to the plaintiff to discontinue the proceeding, as leave to discontinue was not opposed by the defendant subject to terms being imposed. I reserved my decision as to the terms if any, of the leave to discontinue. I now deliver that decision.

3. Counsel for the plaintiff submitted that it was the plaintiff's right to discontinue and that the defendant could not force him to proceed with the trial. As to whether leave to discontinue should be granted on terms, counsel for the plaintiff submitted that the plaintiff had agreed to pay the costs of the defendant up to and including 9th December 2010 to be taxed if not agreed. Counsel for the plaintiff did not make any submissions in reply to the submission of counsel for the defendant that costs should be paid by the plaintiff to the defendant on an indemnity basis.

4. As to whether the plaintiff should give an undertaking not to commence the same or similar proceedings against the defendant as submitted by counsel for the defendant, counsel for the plaintiff said that he did not have instructions and did not make any submissions in opposition to this submission by counsel for the defendant.

5. Counsel for the defendant submitted that the plaintiff did not have a right to discontinue at this stage of the proceeding and in addition, as he had commenced the proceeding by originating summons. Hence, the plaintiff required leave to discontinue and it was in the discretion of the judge whether to permit discontinuance. Further, it was in the discretion of the judge whether to impose terms upon which discontinuance would be permitted.

6. In this instance, it was submitted, terms should be imposed because the conduct of the plaintiff in seeking the substantive relief that he had, bordered on an abuse of process. This was because the substantive relief sought against the plaintiff included very serious charges such as that he be found guilty of smuggling. This was when it had been admitted by counsel for the plaintiff in affidavit evidence that the substantive proceedings are brought, "basically to obtain a restraining order against third parties", and that when a restraining order was not granted, there was no point in pursuing the matter.

7. Further, the plaintiff had previously by delegation, commenced proceedings against the defendant at the District Court at Rabaul for the same alleged breaches of the Customs Act, as are alleged in this proceeding. Those proceedings were struck out by the District Court on 6th July 2010.

8. The terms that should be imposed, submitted counsel for the defendant, are that:

a) the plaintiff should be restrained from commencing the same or similar proceedings against the defendant, and

b) the plaintiff should pay the costs of the defendant of the proceeding on an indemnity basis.

9. The jurisdiction of this court to grant leave to discontinue a proceeding and on terms is provided by Order 8 Rules 61 and 63 National Court Rules. Order 8 Rule 61 (2) is:

"A party making a claim by originating summons may, with the leave of the Court, discontinue the proceedings at any time so far as concerns the whole or any part of the claim."

Order 8 Rule 63 is:

"The Court may give leave under Rule 61 or Rule 62 of this Order on terms."

10. In Heartlink Ltd v. Jones as Liquidator of HL Diagnostics Pty Ltd (in LIQ) [2007] WASC 254, a decision of the Chief Justice of the Supreme Court of Western Australia, Martin CJ, in considering court rules similar to ours concerning discontinuance said:

"It is clear that the court has power to impose conditions, or to require an undertaking, as a term of the grant of leave to discontinue-- see for example, Robertson v Purdey [1906] UKLawRpCh 115; (1906) 2 Ch 615; Heimann v Commonwealth of Australia (1941) 58 WN (NSW) 2 and SCI Operations Pty Ltd v Trade Practices Commission [1984] FCA 52; (1984) 53 ALR 283 at 353. The conditions upon which leave can be granted might include an undertaking not to commence subsequent proceedings or assert particular causes of action in subsequent proceedings—see Heimann v Commonwealth of Australia; SCI Operations.

However, Graham J also established in Covell Matthews & Partners v French Wools Ltd [1977] 1 WLR 876; [1977] 2 All ER 591 and 594 (decision affirmed in Covell Matthews & Partners v French Wools Ltd [1978] 1 WLR 1477; (1978) 2 All ER 800) that:

The court will, normally, at any rate, allow a plaintiff to discontinue if he wants to, provided no injustice will be caused to the defendant. It is not desirable that a plaintiff should be compelled to litigate against his will. The court should therefore grant leave, if it can, without injustice to the defendant, but in doing so should be careful to see that the defendant is not deprived of some advantage which he has already gained in the litigation and should be ready to grant him adequate protection to ensure that any advantage he has gained is preserved.

Similarly, in SCI Operations, Sheppard J observed [at 354] that:

If a party seeks to discontinue proceedings, a court should, in my opinion, lean towards giving him leave unless to do so will cause manifest injustice to his opponent."

11. In SCI Operations, the plaintiff that sought leave to discontinue and gave as a term of the discontinuance an undertaking not to take further proceedings for an injunction, was the Trade Practices Commission; a body established under an Act and with statutory powers. This is similar to the position of the plaintiff in this case as the plaintiff commenced this proceeding pursuant to powers under the Customs Act.

12. As to whether the Trade Practices Commission could restrict itself by giving an undertaking, Sheppard J said that the Commission:

"If it has a wide discretion as to whether to institute proceedings or not, it seems to me to follow that it must have an equally wide discretion to decide whether to maintain existing proceedings or to bring them to an end. If in good faith it decides, as it has done here, to bring proceedings to an end, it must also be empowered, again in good faith, to decide upon what basis the proceedings are to be terminated. Once proceedings are instituted by the Commission, it is of course an ordinary litigant. It takes the court's procedures as it finds them. The rights, obligations and duties which they confer or impose apply to all litigants, whether they be governments or their agencies, corporations or private citizens. All are equal before the law. If justice and fairness dictate that the Commission should in consequence of being given leave to discontinue a proceeding, give up the right to bring further proceedings of a like kind, then it is only right that the Commission, like any other litigant, should have to accept that as a condition of being granted the leave which it seeks."

13. I respectfully agree with these comments and am of the view that they are applicable in this instance. It is open to this court to impose terms upon the plaintiff for it to discontinue this proceeding notwithstanding that the plaintiff has powers conferred by statute to bring a prosecution such as this proceeding.

14. Having regard to the above, the issue to be determined is whether any term should be imposed in order to prevent manifest injustice to, or the loss of some advantage by the defendant.

15. In my view it would be unjust to the defendant if he was again subjected to proceedings by the plaintiff concerning whether he was guilty of breaching the various sections of the Customs Act, when on two (2) previous occasions and particularly in this proceeding, he had travelled from overseas with a witness and was ready and prepared to defend himself, but then just before this trial was to commence, the proceeding was discontinued.

16. I am further persuaded that it would be unjust to permit a similar or the same proceeding against the defendant, when regard is had to the admission of counsel for the plaintiff that this substantive proceeding was commenced to seek a restraining order against third parties and that when the restraining order was not granted there was no point in pursuing the matter. The implication is that either it was not intended to seek the substantive relief against the defendant or indeed, that there was no merit in the allegations made against him. Either way, it casts considerable doubt on whether the plaintiff's reasons for commencing this proceeding were legitimate.

17. In the circumstances therefore I am satisfied that a term of the plaintiff being granted leave to discontinue this proceeding should be that the plaintiff and his officers or agents are permanently restrained from commencing or prosecuting the same or similar proceedings as this proceeding OS 548 of 2010, against the defendant.

18. As to costs, although the submission was made that costs should be paid on an indemnity basis, I am not satisfied that such is warranted. The plaintiff shall pay all of the costs of the defendant of and incidental to this proceeding to be taxed if not agreed pursuant to s. 175 Customs Act.

Orders

19. The orders of the Court are:

a) leave is granted to the plaintiff to discontinue this proceeding on the term that the plaintiff, his officers and agents of permanently restrained from commencing or prosecuting the same or similar proceedings as this proceeding OS 548 of 2010 against the defendant.

b) the plaintiff shall pay the costs of the defendant of and incidental to this proceeding to be taxed if not agreed, pursuant to s. 175 Customs Act.

____________________________________________________________

Namani & Associates: Lawyers for the Plaintiff
Young & Williams Lawyers: Lawyers for the Defendants