Derks v Bray [2018] PGNC 536; N7665 (22 October 2018)

N7665

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS NO. 444 OF 2009

IN THE MATTER OF THE WILLS PROBATE AND ADMINISTRATION ACT CHAPTER 198

IN THE MATTER OF AN APPLICATION TO REMOVE AN EXECUTOR

HENDRIKUS DERKS
Applicant

V

JOHN BRAY
Respondent

Waigani: Kariko, J
2018: 10^th & 22^nd October

CIVIL PRACTICE & PROCEDURE – application to dismiss proceedings – whether reasonable cause of action disclosed – Order 12 Rule 40, National Court Rules

CIVIL PRACTICE & PROCEDURE – Application to dismiss for want of prosecution- Order 4 Rule 36, National Court Rules

Cases Cited

Kiee Toap v The State (2004) N2731
Kerry Lerro v Phillip Stagg & Ors (2006) N3050
Kai Ulo & 2 Ors v The State [1981] PNGLR 148
Phillip Takori v Simon Yagari & Ors (2008) SC905
Tigam Malewo v Keith Faulkner (2009) SC960
Vivisio Seravo v. Jack Bahofa (2001) N2078

Legislation

National Court Rules
Wills Probate and Administration Act (Chapter 291)

Counsel:

Mr G Sheppard & Ms L Painap, for the Applicant/Respondent
Mr. T. Teine & Mrs M Ai, for the Respondent/Applicant

DECISION

22^nd October, 2018

1. KARIKO, J: This is an application by way of a notice of motion filed 19^th April, 2018 by the respondent/applicant John Bray (Bray) seeking to dismiss the proceedings for disclosing no reasonable cause of action pursuant to O12 r 40 National Court Rules and alternatively, for want of prosecution pursuant to O10 r5 National Court Rules.
   
2. The notice of motion also contained an application to reseal probate of the will of the late Arnoldus Theodore Derks of Lae (the Will) who died in May 2008 (the Deceased) and for an order against the applicant/respondent Hendrikus Derks (Derks) to execute documents necessary for the release and payment of insurance monies to the estate of the Deceased (the Estate) under an AMP life insurance policy taken out by the Deceased.
   
3. That application was heard and granted on 22^nd August, 2018 while the application to dismiss the proceedings was deferred for hearing at a later date.
   
4. Pending the hearing of the deferred application, further notices of motion have been filed including that by Bernadus Derks (Bernadus) dated 4^th October, 2018 principally seeking to have Derks removed and that he replace him as the applicant in these proceedings.
   
5. On 11^th September, 2018 I adjourned the matter after I was informed from the bar table that Derks wished to discontinue the proceedings. Mrs Ai counsel for Bray informed the Court she had no instructions regarding the application for discontinuance, so the adjournment was to allow her to confirm instructions with her client and for both parties to prepare submissions to assist the Court on the question of whether the Estate should pay the costs of the proceedings or otherwise. I did not refuse the applicant’s application to discontinue the proceedings as has been suggested by Mr Sheppard.
   
6. On the return of the matter, I decided to proceed first with Bray’s application to dismiss after his lawyers confirmed his instructions to seek dismissal of the proceedings rather than consent to the discontinuance of the proceedings. I took into account the fact that Bray’s application was filed first in time – some 5 months before the other pending notices of motion.

Brief background to the proceedings

7. As I summarised in my earlier ruling of 22^nd August, 2018, the substantive proceeding is some 9 years old and concerns an on-going dispute between Bray and Derks, who were appointed co-executors under the Will to administer the Estate. Derks alleges that Bray has breached his fiduciary duties as an executor and acted contrary to the interest of the Estate and that he ought to be removed as an executor pursuant to Section 65 of the Wills Probate and Administration Act (Chapter 291).
   
8. The sole beneficiary of the Will is Bernadus Derks, son of the Deceased. According to the Will, Bernadus stood to inherit most of the Estate upon reaching the age of 18 years, which anniversary occurred on 28^th June this year.

Legal principles

9. The relevant legal principles concerning applications made under Order 12 Rule are clearly set out in cases such as Kiee Toap v The State (2004) N2731; Kerry Lerro v Phillip Stagg & Ors (2006) N3050 and Phillip Takori v Simon Yagari & Ors (2008) SC905.
   
10. Whenever a person brings a case to court, the originating document must demonstrate that the plaintiff has a cause of action. The document must clearly set out the legal ingredients or the elements of the claim and the facts that support each element of the claim. Only if the plaintiff’s originating document does that, is there a reasonable cause of action; Tigam Malewo v Keith Faulkner (2009) SC960 and Kiee Toap v The State (supra).
    
11. While Bray has cited Order 10 Rule 5 of the National Court Rules for the alternative ground to dismiss, it is clear to me that Order 4 Rule 36 should have been invoked as the appropriate jurisdictional basis. The principles to apply in deciding applications made under either rule are generally similar. No issue has been taken on this aspect by Derks’ counsel and I do not view any prejudice is caused by amending the incorrect citation of the appropriate rule.
    
12. Order 4 Rule 36 gives the Court a discretion to dismiss proceedings that are not prosecuted “with due despatch”. The relevant principles in relation to an application under this Rule are clearly summarised by Kandakasi, J in the case of Vivisio Seravo v. Jack Bahofa (2001) N2078 where His Honour restated that an application for a dismissal of proceedings for want of prosecution may be granted if:
    
    • (1) The plaintiff's default is intentional or is allowing for an inordinate and inexcusable delay in a prosecution of his claim;
    • (2) There is no reasonable explanation given by the plaintiff for the delay; and
    • (3) That the delay has caused injustice or prejudice to the defendant.
      
13. In Kai Ulo & 2 Ors v The State [1981] PNGLR 148, the Supreme Court said that the onus is on an applicant to establish a prima facie case of delay and the onus then shifts to the respondent to give a satisfactory explanation for the delay.
    

Consideration

14. Counsel for Bray did not press any submissions on the first ground of his application to dismiss, and I am not satisfied that no reasonable cause of action is disclosed in this case. This is an action pursuant to the Wills Probate and Administration Act (Chapter 291) for the removal of an executor of a will and for the executor to produce accounts.
    
15. As to the alternative ground for dismissal, there can be no argument that it is most unwarranted for a court case to be still pending trial nine years after it was filed, particularly given the nature of the claim.
    
16. This case was filed in the National Court in Lae on 17^th August, 2009 and while various interlocutory applications were filed or dealt with, the proceedings were not progressed to hearing before it was ordered on 23^rd June, 2017to be transferred to Waigani.
    
17. Since the matter was first listed before me on 7^th December, 2017 there have been no steps taken by the applicant/respondent to have his claims tried. There has been one particular issue that has been argued and that related to the payment of insurance monies, referred to earlier.
    
18. Derks has not filed any evidence in response to the defendant’s notice of motion filed 19^th April, 2018 in relation to the present application. He only filed an affidavit in answer to the application concerning the release and payment of insurance monies but nothing further.
    
19. There is an affidavit by Bernadus filed 8^th October, 2018 attaching a bundle of documents given to him by his lawyers (who are also Derks’ lawyers) to show that the case has been largely delayed by the National Court in Lae. That is not evidence by the plaintiff nor does Bernadus depose that he has been authorized by Derks to file this affidavit on his behalf in response to the defendant’s notice of motion filed 19^th April, 2018. I also note that Bernadus has an application to remove and replace Derks, so it is unclear on the face of that affidavit if it was filed in respect of the applications by Bernadus or for another purpose. In the circumstances, I find that Derks has not filed any evidence to rebut the application to dismiss the proceedings.
    
20. In any case, it is trite that a plaintiff has the primary obligation to prosecute his case with due diligence or due despatch. I am unable to accept the argument that the Court is to blame for the case not being tried for the last 9 years. It is the applicant’s case and the primary obligation is on the applicant to prosecute his case “with due despatch”. Even after this case transferred to Waigani, the applicant has not sought directions to expedite the case to hearing, even though there were a couple of adjournments that were for directions hearing. I am not persuaded that a reasonable explanation has been advanced by Derks for the inordinate delay of over 9 years in prosecuting his case.
    
21. Mr Sheppard has urged me to find that Bray has not discharged his duties as executor and has in fact mismanaged the monies due to the Estate. He referred me to written submissions handed up to court which appear to be submissions prepared on behalf of Bernadus in relation to his pending notice of motion and which lists instances of the alleged breaches of duty and mismanagement of funds. I am not in a position to accept or decide those allegations against Bray which must obviously be properly tried. Bray himself has raised allegations of mismanagement of Estate funds against Derks. Those too would have to be tried.
    
22. I have no doubt the delay has caused considerable prejudice to Bray, least of all in relation to the legal costs that continue to be incurred while serious allegations still hang over his head. I note that Mr Sheppard earlier claimed in proceedings OS 550 of 2018, recently filed against his client Derks but then withdrawn, that his client owes over K500,000 as legal costs. I can safely assume from that the legal costs incurred by Bray would also be substantial.
    
23. It is my decision therefore that this proceeding be dismissed for want of prosecution.
    
24. On the issue of costs, I do not consider the Estate should bear those. Derks initiated these proceedings knowing full well legal costs would be incurred and it is always in everyone’s interest to keep those costs to a minimum. Mrs Ai has asked the Court to award costs on a solicitor/client basis. Awarding costs is a discretionary matter, and costs on a solicitor/client basis may be awarded against a party whose conduct has been improper, unreasonable and blameworthy; Rex Paki v MVIL (2010) SC1015. This is a case where I should order such costs – the conduct of Derks has been unreasonable, in my view.
    
25. Even though it is unnecessary for me to discuss the application for discontinuance of the proceedings, I note that no formal application has been filed with supporting affidavit by Derks in relation to that matter.
    
26. I further note that pursuant to the Will the co-executors are to administer certain aspects of the Estate until Bernadus attains the age of 21 years and 25 years. If any of the executors wish to cease as an executor, he should file the appropriate application. Should Bernadus wish to have either or both of the executors removed now that he has reached the age of 18 years, the appropriate application should be filed separately. He is of course at liberty to also apply for the executors to pass their accounts. If he believes any of the co-executors have breached his fiduciary duties to the detriment to the Estate, he may also file proceedings in respect of that. Mr Sheppard confirmed in submissions that Bernadus has in fact filed separate proceedings.
    

Order

27. The order of the Court are:
    
    • (1) These proceedings are dismissed for want of prosecution.
    • (2) The applicant Hendrikus Derks shall pay the respondent John Bray’s costs of and incidental to the proceedings on a solicitor-client basis, to be taxed if not otherwise agreed.
    • (3) Time for entry of these orders is abridged to the time for settlement by the Registrar which shall take place forthwith.

________________________________________________________________
Young & Williams Lawyers: Lawyer for the Applicant/Respondent
Albatross Lawyers: Lawyer for the Respondent/Applicant