Kewa v Madang Provincial Government [2014] PGNC 109; N5650 (27 June 2014)

N5650

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

WS NO 676 OF 2013

JACOB KEWA
Plaintiff

V

MADANG PROVINCIAL GOVERNMENT
Defendant

Madang: Cannings J
2014: 20 February, 21 May, 27 June

DEBT AND DAMAGES – assessment – breach of contract – oral contract for provision by plaintiff of transport and labour to defendant – defendant's failure to honour invoice – liability entered by default judgment.

The plaintiff entered into an oral contract with the defendant to provide it with transport and labour. The terms of the contract were met by both parties and the practice developed of the plaintiff presenting an invoice detailing the transport and labour he had provided, and these invoices were paid in a timely manner by the defendant. There was one invoice, however, that the defendant did not honour. After several years the plaintiff sued for the debt due under that invoice and for damages for breach of contract. The defendant failed to file a defence and default judgment on liability was entered against it, subject to an assessment of debt and damages. This was a trial on assessment of debt and damages. The plaintiff sought three categories of relief: (a) debt of K34,423.20 in respect of the unpaid invoice; (b) general damages for pain and hardship, K10,000.00; (c) special damages, K5,000.00, a total claim of K49,423.20.

Held:

(1) The plaintiff was awarded: (a) K34,423.20 for the full amount of the unpaid invoice + (b) K5,000.00 for pain and hardship + (c) zero special damages as the claim was vague, a total award of K39,423.20.

(2) The court awarded a total amount of debt and damages of K39,423.20 plus interest of K3,059.24, being a total judgment sum of K42,482.44.

Cases cited

The following case is cited in the judgment:

William Mel v Coleman Pakalia (2005) SC790

TRIAL

This was a trial on assessment of damages for breach of contract and negligence.

Counsel

D F Wa'au, for the plaintiff
G Haumu, for the defendant

27th June, 2014

1. CANNINGS J: This is an assessment of debt and damages for breach of contract, following entry of default judgment.

2. The plaintiff, Jacob Kewa, entered into an oral contract with the defendant, Madang Provincial Government, to provide transport and labour to the defendant during the period of the Manam Island Volcano Disaster, in 2004 and 2005. The terms of the contract were met by both parties and the practice developed of the plaintiff presenting an invoice detailing the transport and labour he had provided, and these invoices were paid in a timely manner by the defendant.

3. There was one invoice, however, that the defendant did not honour. It was issued on 26 October 2005 in the sum of K34,423.20. The plaintiff tried over many years to get this invoice honoured but for some reason, which was never made clear, the defendant did not pay. On 2 July 2013 he commenced proceedings by writ of summons against the defendant, claiming the debt due under that invoice and damages for breach of contract. The defendant failed to file a defence and on 28 October 2013 default judgment on liability was entered against it, subject to an assessment of debt and damages.

4. This was a trial on assessment of debt and damages. The plaintiff seeks three categories of relief: (a) debt of K34,423.20 in respect of the unpaid invoice; (b) general damages for pain and hardship, K10,000.00; (c) special damages, K5,000.00, a total claim of K49,423.20.

5. The effect of the default judgment is that the facts and cause of action pleaded in the statement of claim are presumed to have been proven, and are only revisited if they do not make sense or would make an assessment of damages a futile exercise (William Mel v Coleman Pakalia (2005) SC790). Here, the facts pleaded were clear, as were the causes of action relied on, so the issue of liability has not been reconsidered.

1. UNPAID INVOICE
   

6. This is a straightforward claim. The invoice was presented in accordance with the terms of the oral contract. Many similar invoices had been previously paid. It is not clear why there was a problem with this one. The claim is reasonable and it is supported by the evidence. I award the whole of the sum claimed: K34,423.20.

2. GENERAL DAMAGES FOR PAIN AND HARDSHIP
   

7. I think that this is a fair claim, though it is difficult to quantify. There is evidence that the plaintiff has suffered anguish and stress because of the breach of contract and the failure of the defendant to explain the refusal or difficulty in paying this particular invoice. I award K5,000.00.

3. SPECIAL DAMAGES
   

8. This is a vague claim, unsupported by the statement of claim or the evidence. Nothing is awarded.

SUMMARY OF DEBT AND DAMAGES ASSESSED

1. Unpaid invoice: K34,423.20,
2. General damages for pain and hardship: K5,000.00,
3. Special damages: 0,
   

being a total award of K39,423.20.

INTEREST

9. Interest will be awarded at the rate of 8 per cent per annum on the total amount of damages under Section 1(1) of the Judicial Proceedings (Interest on Debts and Damages) Act Chapter No 52. Interest is calculated from the date of service of the writ, 8 July 2013, to the date of this judgment, a period of 0.97 years, by applying the formula D x I x N = A, where:

• D is the amount of debt and damages assessed;
• I is the rate of interest per annum;
• N is the appropriate period in number of years;
• A is the amount of interest.
  

Thus K39,423.20 x 0.08 x 0.97 = K3,059.24.

COSTS

10. The general rule is that costs follow the event, ie the successful party has its costs paid for by the losing party on a party-to-party basis. I apply that rule of thumb here. The plaintiff will be awarded costs.

ORDER

11. The Court orders that:

(1) the defendant shall pay to the plaintiff debt and damages of K39,423.20 plus interest of K3,059.24, being a total judgment sum of K42,482.44; and

(2) the defendant shall pay the plaintiff's costs of the proceedings on a party-party basis which shall, if not agreed, be taxed.

Judgment accordingly.
____________________________________________________________
Meten Lawyers: Lawyers for the Plaintiff
Provincial Legal Officer: Lawyer for the Defendant