N4048

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

WS 69 OF 2009

BETWEEN:

KONZE KARA as Administrator of the estate of KIBIKANG YAKKA KARA, Deceased
Plaintiff

AND:

PUBLIC CURATOR OF PAPUA AND NEW GUINEA
First Defendant

AND:

THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Second Defendant

Waigani: Hartshorn J.
2009: 7th August,
2010: 13th April

Claims By and Against the State Act s. 5 - notice of intention to make a claim against the State - whether notice required to be given for a claim made pursuant to s. 36 Public Curator Act – whether " State" in Claims By and Against the State Act includes the Public Curator - consideration of principles concerning joinder of parties – Order 8 Rule 5 National Court Rules 

Facts:

1.	The Plaintiff as administrator of a deceased estate is suing the Public Curator and the State in respect of the Public Curator’s administration of the estate.

2.	The First Defendant seeks orders that the Plaintiff has not complied with s. 5 Claims By and Against the State Act (Claims Act) as no notice or proper notice of claim has been given to the defendants within the statutory time limitation period and further, an order for the joinder of certain entities.

Held:

1. The Public Curator is not included in the term "State" as used in the Claims Act. Consequently, notice pursuant to s. 5 Claims Act of the claims of the Plaintiff against the Public Curator was not required to be given. 

2. The Plaintiff’s claim against the State pursuant to s. 36 Public Curator Act is a statutory cause of action and not one founded on contract or tort or a breach of constitutional rights. Consequently, notice of this claim pursuant to s. 5 Claims Act is not required to be given: Mision Asiki v. Manasupe Zurenoc, Provincial Administrator, Morobe Provincial Administration and the Independent State of Papua New Guinea (2005) SC797 and Morobe Provincial Government v. The State (2007) SCA 44/05 unreported, unnumbered, delivered 28th June 2007 applied.

3. The First Defendant has not satisfied the requirements of Order 5 Rule 8(1) National Court Rules concerning the addition of parties. 

4. The orders sought by the First Defendant are refused.

Cases cited:

AGC (Pacific) Ltd v. Sir Albert Kipalan & Ors (2000) N1944
SCR No. 1 of 1998; Reservation pursuant to s. 15 of the Supreme Court Act (2001) SC6728
Umapi Luna Pakomeyu v. James Siai Wamo (2004) N2718 
Mision Asiki v. Manasupe Zurenoc, Provincial Administrator, Morobe Provincial Administration and the Independent State of Papua New Guinea (2005) SC797
Naomi Vicky John v. National Housing Corporation (2005) N2770
Wamena Trading Ltd v. Civil Aviation Authority of Papua New Guinea (2006) N3058
Morobe Provincial Government v. The State (2007) SCA 44/05 unreported, unnumbered, delivered 28th June 2007
Peter Komba v. National Capital District Commission (2007) unreported, unnumbered, delivered 26th July 2007
PNG International Hotels Pty Ltd & Anor v. The Registrar of Land Titles and Ors (2007) N2307
Anave Megaraka Ona v. National Housing Corporation (2009) N3623 

Counsel:

Mr. J.L. Shepherd, for the Plaintiff 
Mr. R. Saulep, for the First Defendant
Mr. F. Kuelinad, for the Second defendant

13th April, 2010

1. HARTSHORN J: The Plaintiff as administrator of a deceased estate, is suing the First Defendant, the Public Curator of Papua New Guinea and the Second Defendant, the State in respect of the Public Curator’s administration of the estate.

2.	The First Defendant now seeks:

a)	an order that the Plaintiff has not complied with s. 5 Claims By and Against the State Act (Claims Act) as no notice or proper notice of claim has been given to the defendants within the statutory time limitation period,

b)	an order for the joinder of certain entities.

3. The Second Defendant adopts the First Defendant’s submissions.

4. The Plaintiff opposes the applications.

Claims Act

5. The First Defendant submits that any causes of action that the Plaintiff may have would have accrued in 1992. The Claims Act came into force in February 1997 and pursuant to s. 21(2) Claims Act, notice of the Plaintiff's claim should have been given by August 1997. Notice of the Plaintiff's claim was not given until April 2007, nearly 10 years later and so s. 5 Claims Act has not been complied with.

6. The Plaintiff submits that:

a)	notice of its claim against the First Defendant did not have to be given under s. 5 Claims Act as the First Defendant, the Public Curator, is a statutory corporation and cannot be characterised as part of the State for the purposes of the Claims Act,

b)	notice was given to the Solicitor General of the Plaintiff's Claim on the 13th April 2007,

c)	the Plaintiff's claim against the State is a statutory claim pursuant to s. 36 Public Curator Act and notice under s. 5 Claims Act does not have to be given in respect of a statutory claim,

d)	there is no requirement that notice must be given under s. 5 	Claims Act for claims for breach of statutory duty, devastavit and breach of fiduciary duties.

Whether s. 5 Claims Act notice must be given for the claim against the State

7. The Supreme Court in Mision Asiki v. Manasupe Zurenuoc, Provincial Administrator, Morobe Provincial Administration and the Independent State of Papua New Guinea (2005) SC797 held amongst others, that the notice requirements of the Claims Act apply only to actions that are founded on contract or tort or a breach of constitutional rights. That case concerned an application for judicial review. Then in Morobe Provincial Government v. The State (2007) SCA 44/05 unreported, unnumbered, delivered 28th June 2007, the Supreme Court held that notice under the Claims Act was not required to be given in respect of claims for funding founded on provisions of the Organic Law on Provincial Government and Local Level Government, as they are not claims in contract or tort, nor claims under ss. 57 and 58 Constitution.

8. The Court agreed with the analysis in Mision Asiki (supra) that the word "claim" in s. 5 Claims Act has the meaning provided by s. 2, that is, it means a claim in tort or contract or pursuant to the Constitution s. 57 or s. 58, and that, "Other claims do not fall within the meaning of "claim" in Section 5.". Mision Asiki (supra) and Morobe (supra) are binding on this court.

9. The Plaintiff's cause of action against the State is pleaded as being pursuant to s. 36 Public Curator Act which provides amongst others, that the State may be held liable for acts or omissions of the Public Curator. On the authority of Mision Asiki (supra) and Morobe (supra), the cause of action against the State founded on s. 36 Public Curator Act, being a statutory cause of action and not one founded on contract, or tort or a breach of constitutional rights, does not require that notice pursuant to s. 5 Claims Act be given.

Whether "State" includes the Public Curator

10. For it to be necessary that the notice requirements of the Claims Act are followed in respect of the Plaintiff's claims against the Public Curator, the Public Curator must be included in the term "State" as used in the Claims Act.

11. The leading authority on whether an entity is included in the term "State" in the Claims Act, is SCR No. 1 of 1998; Reservation pursuant to s. 15 of the Supreme Court Act (2001) SC672. The Supreme Court held that a provincial government is included in the term "State" in the Claims Act. Numerous decisions of this court have considered the question. They include Naomi Vicky John v. National Housing Corporation (2005) N2770, where Lay J. (as he then was), after a detailed consideration of SCR 1/98 (supra), held that the National Housing Corporation was not included in "State". Then in Wamena Trading Ltd v. Civil Aviation Authority of Papua New Guinea (2006) N3058, another decision of Lay J., it was held that the Civil Aviation Authority was not included in "State". Recently in Anave Megaraka Ona v. National Housing Corporation (2009) N3623, a decision of Sevua J., it was held that the National Housing Corporation was not included in "State".

12. In the Naomi John case (supra), Lay J. listed six (6) criteria that persuaded the Supreme Court in SCR 1/98 (supra) to arrive at its decision as to whether a provincial government was included in "State". These criteria are whether the subject entity:

a)	is established by the Constitution,

b)	is part of the three tier structure of government enshrined in the Constitution,

c)	is constituted by elected representatives like the other tiers of government,

d)	has some control exercised over it by the National Government in political, administrative and financial matters,

e)	falls within the definition of "governmental body" contained in the Constitution,

f)	has its judgment debts recoverable from money allocated in the budgetary process.

13. Lay J. stated that as in his view, the National Housing Corporation only fulfilled two (2) of the criteria and that, "..to meet the test applied by the Supreme Court, it is not enough that an entity is financially dependent on the State and controlled by the State, it must also itself be part of the three tier structure of constitutional government.", he determined that the National Housing Corporation is not included in "State".

14. I respectfully agree with the criteria listed by Lay J. in the Naomi John case (supra) as I stated in Peter Komba v. National Capital District Commission (2007) unreported, unnumbered, delivered 26th July 2007. In that case I held that the National Capital District Commission was included in "State".

15. Applying the criteria in Naomi John (supra) to this case, the Public Curator is a corporation with perpetual succession pursuant to s. 2(2) Public Curator Act. The First and Second Defendants have admitted that the Public Curator is a statutory corporation capable of being sued. As to the first 3 criteria, the Public Curator is not established by the Constitution, is not part of the three tier structure of government enshrined in the Constitution and is not constituted by elected representatives.

16. As to the remaining three (3) criteria, there is no evidence before me concerning any control exercised by the National Government or the procedure to be followed for payment of judgment debts. There is also no evidence as to sources of revenue, whether any is from the administration of estates or whether it is totally sourced from the National Government. I will assume for present purposes that the National Government provides for the Public Curator financially and exercises some control administratively.

17. As to whether the Public Curator is a "governmental body" as defined in the Constitution, when regard is had to the relevant parts of that definition I am not of the view that the Public Curator is an instrumentality of the National Government, or a body set up by statute for governmental or official purposes.

18. A further consideration is that s. 36 Public Curator Act provides for the State to be sued in respect of actions of the Public Curator. The Plaintiff submits that if it was not for this section the State would not be liable for actions of the Public Curator as the Public Curator is not the State and not an agent of the State. It can be argued that the inclusion of this section is an implied acknowledgement by the legislature that as the Public Curator is not the State, some other recourse needed to be provided to persons with legitimate complaint concerning the Public Curator's actions.

19. In my view the Public Curator fulfils two (2) of the criteria in Naomi John (supra) but he is not part of the three tier structure of constitutional government. He is a corporation with perpetual succession.

20. For all of the above reasons, I conclude that the Public Curator is not included in the term "State" as used in the Claims Act on the tests applied in SCR 1/98 (supra).

21. Consequently, notice pursuant to s. 5 Claims Act of the claims of the Plaintiff against the Public Curator was not required to be given. Given this finding it is not necessary to consider the other arguments of counsel concerning notice under the Claims Act.

Joinder

22. The First Defendant applies pursuant to Order 5 Rule 8 National Court Rules to have Rolf Lahui, Ivan Pomaleu, Robert Wong, Australia & New Zealand Banking Group (PNG) Limited and Bank South Pacific Limited (proposed parties) joined as defendants.

23. Mr. Lahui is sought to be joined as he was the Public Curator when the conduct of which complaint is made occurred, Mr. Ivan Pomaleu is sought to be joined as he was the Registrar of Companies when a property of the estate at Mount Diamond was purportedly sold by the Registrar of Companies, Mr. Robert Wong is sought to be joined as he was the agent of the Public Curator in regard to the estate for a period of time and the two banks are sought to be joined as they exercised their powers as mortgagees of property of the estate.

24. As to an application to add a party to a proceeding, as Davani J. said in PNG International Hotels Pty Ltd & Anor v. The Registrar of Land Titles and Ors (2007) N2307, the principles on joinder in this jurisdiction are well established. They were discussed by Kandakasi J. in Umapi Luna Pakomeyu v. James Siai Wamo (2004) N2718 where he enunciated principles adopted by Sakora J. in AGC (Pacific) Ltd v. Sir Albert Kipalan & Ors (2000) N1944.
25. These principles are;

a) whether the applicant has sufficient interest in the proceedings,

b) whether the applicant’s joinder as a party is necessary to ensure that all matters in dispute in the proceedings can be effectively and completely adjudicated upon.

26. In considering whether a proposed party has a sufficient interest in the proceeding or whether his joinder is necessary to ensure that all matters in dispute in the proceeding can be effectively and completely adjudicated upon, certain factors warrant consideration.
27. These include whether:

a)	any relief is sought against the proposed party,

b)	the plaintiff opposes the application for joinder,

c)	 the proposed party will be affected if the relief sought in the statement of claim is granted,

d)	the joinder of the proposed party is necessary to satisfy any orders made in the proceeding. 

28. As to whether any relief is sought against any of the proposed parties, no relief is sought against any of them.

29. The Plaintiff opposes the joinder application as he makes no claim against any of the proposed parties such that they should be joined. Further, the Plaintiff submits that the First Defendant can join the proposed parties as cross defendants if he wishes to make any claim against them but the Plaintiff is entitled to choose whom he wishes to sue.

30. As to whether the proposed parties will be affected if the relief sought in the statement of claim is granted, they will not.

31. As to whether the joinder of the proposed parties is necessary to satisfy any orders that are likely to be made in the proceeding, as no claim is made against them, their joinder is not necessary for this purpose.

32. If necessary the First Defendant can summons the proposed parties to give evidence and as submitted by the Plaintiff, name them as cross defendants if he wishes to make any claim against them.

33. After considering the arguments of counsel I am not satisfied that the First Defendant has satisfied the requirements of Order 5 Rule 8(1) National Court Rules concerning the addition of parties.

Orders

34.	a)	the orders sought by the First Defendant in:

i)	paragraph 6 of the amended notice of motion filed 23rd March 2009,

ii)	the notice of motion filed 25th March 2009,

iii)	paragraph 2 of the notice of motion filed 16th April 2009,

are refused.

b) the costs of and incidental to the orders sought referred to in paragraph 34 (a) are to be paid by the First Defendant to the Plaintiff.

_________________________________________________
Blake Dawson Lawyers: Lawyers for the Plaintiff 
Saulep Lawyers: Lawyers for the First Defendant 
Office of the Solicitor-General: Lawyers for the Second Defendant