Lawi v Lalie [2020] PGNC 460; N8775 (18 December 2020)

N8775

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

WS NO.1164 OF 2017 (CC4)

BETWEEN:
MARIA LAWI
Plaintiff

AND:
JOE LALIE in his capacity as the Executive Director of
International Education Agency of Papua New Guinea Limited
First Defendant

AND:
KARAHO-TEOTI ASIMI in his capacity as the Corporate Services Manager of International Education Agency of Papua New Guinea Limited
Second Defendant

AND:
INTERNATIONAL EDUCATION AGENCY OF PAPUA NEW GUINEA LTD
Third Defendant

Waigani: David, J
2020: 7^th &18^th December

PRACTICE & PROCEDURE – application for dismissal of proceedings – claim in contract for sale of land or interest in land – contract to be in writing – contract or some note or memorandum of the contract – Frauds and Limitations Act, Section 4 - National Court Rules, Order 12 Rule 40.

Cases Cited:
Papua New Guinea Cases

The State v Peter Painke [1976] PNGLR 210
The State v Peter Painke (No.2) (1977) PNGLR 141
Active Auto Parts (PNG) Pty Ltd v Brian Hull (1990) N833
Jacobs v Kwaindu [1991] PNGLR 366
Anderson Agiru v Electoral Commission and The State (2002) SC687
Kiee Toap v The State (2004) N2731
Steven Naki v AGC (Pacific) Ltd (2005) N2782
Kerry Lerro v Philip Stagg (2006) N3050
Pamela Ipi Pangu v Ian Ellery (2007) N3227
Philip Takori v Simon Yagari (2008) SC905
Telikom PNG Limited v ICCC & Digicel (PNG) Limited (2008) SC906
Tigam Malewo v Keith Faulkner (2009) SC960
Mt Hagen Urban Local Level Government v Sek No. 15 Ltd (2009) SC1007
Associated Plumbing Installation Ltd v Air Niugini Ltd (2011) SC1127
Sonny Atua v Grace Kemmah (2011) N4296
Hendrikus Derks v John Bray (2018) N7665

Overseas Cases

Hunter v Chief Constable of the West Midlands Police and Others [1981] UKHL 13; (1982) AC 529
House of Spring Gardens Ltd v Waite (1991) 1 QB 241

Counsel:

J. Kambao, for the Plaintiff
N. Pilamb, for the Defendants

RULING

18^th December, 2020

1. DAVID, J: INTRODUCTION: This is a ruling on a contested application moved by the defendants through their notice of motion filed on 30 October 2020. The first relief sought in the motion which was more or less similar to the alternative relief sought was abandoned at the hearing and is dismissed. The defendants opted to pursue the alternative relief by which they seek an order to dismiss the proceedings which concerns a claim of interest in land for; failing to disclose a reasonable cause of action; or for being frivolous or vexatious; or is an abuse of the process of the Court pursuant to Order 12 Rule 40 (1) of the National Court Rules.
   

EVIDENCE

2. The defendants’ motion was supported by an affidavit of Nathan Pilamb sworn and filed on 30 October 2020; and an affidavit of Neil Mather sworn and filed on 30 October 2020.

3. The plaintiff, Maria Lawi relies on; the Affidavit of Maria Lawi sworn on 6 October 2020 and filed on 7 October 2020; and the Affidavit of Emma Wurr sworn and filed on 11 November 2020.

PLEADINGS

4. In proceedings commenced by writ of summons endorsed with a statement of claim filed on 2 November 2017, the plaintiff claims that while working as an employee of the third defendant, International Education Agency of Papua New Guinea, initially as an Accounts Clerk and later as an Accounts Supervisor which commenced on 25 September 2000 until unlawfully terminated without good cause on 12 February 2015, the third defendant offered to sell to her a property described as Allotment 1 Section 242, Hohola, National Capital District belonging to the third defendant (the Property) which she agreed to purchase and which purchase was to be facilitated under the third defendant’s Staff Housing Scheme. It is alleged that on 14 March 2008, the defendants through the third defendant’s former Director of Corporate Services namely, Trent Coligan and the founder and former Executive Director of the third defendant namely, the late Steven Mead made the offer to sell the Property to the plaintiff. The plaintiff asserts that in breach of the agreement, the third defendant has failed to transfer the Property to her. The plaintiff also asserts that she moved into the Property on or about 8 April 2008 after obtaining the keys and she has been paying the public utilities including bills for water, sewerage, garbage, land tax and electricity since taking possession of the Property. The plaintiff also asserts that; she has caused substantial improvements to be done to the Property; and that following the retirement of Trent Coligan, no further steps have been taken by the defendants to transfer the Property to her.

5. The plaintiff alleges that on 30 January 2015, she received a warning letter from the third defendant’s Financial Controller namely, Isuri Kularatne accusing her of gross misconduct and excessive tardiness. On 12 February 2015, the plaintiff was served a termination letter.

6. The plaintiff also alleges that by unlawfully terminating her from her employment, her children’s right to education and her right to full protection of the law under Section 37 of the Constitution, her right to protection from unjust deprivation under Section 53 of the Constitution and that the actions of the defendants were harsh and oppressive within the meaning of Section 41 of the Constitution.

7. The plaintiff seeks, among others, orders that:

1. The defendants complete the transfer of the Property from the third defendant to her within 30 days or in the alternative damages for breach of the agreement.
2. Reinstatement to substantive position held with the third defendant before being unlawfully terminated from her employment.
3. Damages for unlawful termination.
4. Damages for actions affecting children’s education.
5. General damages for breach of constitutional rights.
6. Special damages.
   

8. On 10 December 2018, each defendant filed a separate defence denying entirely liability.

9. As to the alleged breach of agreement to sell the Property to the plaintiff, the defendants state, among others, that:

1. The third defendant did not agree to sell the Property to the plaintiff.

2. There was no agreement to sell the Property to the plaintiff.

3. The plaintiff’s claim of having an interest in land was contrary to the requirements under Sections 2 and 4 of the Frauds and Limitations Act.
   

10. As to the claim for unlawful termination of employment, the defendants essentially state, among others, that:

1. The plaintiff was properly and lawfully terminated.

2. The plaintiff was served a warning letter for refusing to follow her immediate Supervisor’s directions to resume work on a date earlier to her resumption date due to an immediate emergency.
3. On receiving the warning letter, the plaintiff returned her office keys, absconded from work, and started inciting disunity amongst office staff and encouraging them to go on strike.
4. By returning the office keys and absconding from work, the plaintiff resigned from her employment.
   

LEGAL ISSUE

11. The main legal issue is whether the proceedings which concerns the disposition of land or an interest in land fail to disclose any reasonable cause of action or are frivolous or vexatious or are an abuse of the process of the Court to warrant dismissal.

PARTIES’ SUBMISSIONS

12. I have considered the parties’ submissions.

13. The defendants essentially contend that in so far as the plaintiff’s claim concerns an interest in land, the statement of claim fails to disclose a reasonable cause of action, or is frivolous or vexatious or is an abuse of the process of the Court in the absence of a valid and enforceable contract which could be specifically performed and more so when the requirement under Sections 2 and 4 of the Frauds and Limitations Act for disposition of land or an interest in land in writing are not met. It is submitted that there is no existence of any formal written agreement or document executed by the parties demonstrating the parties’ agreement for the transfer of the Property by the third defendant to the plaintiff and there are no pleadings to that effect in the statement of claim to set the foundation for the claim. Any correspondence, including emails, exchanged between the defendants and the plaintiff and relied on by the plaintiff to demonstrate the existence of a contract for sale of the Property by the third defendant to the plaintiff cannot be relied on as they have neither been pleaded in the statement of claim nor allowed on the authority of Associated Plumbing Installation Ltd v Air Niugini Ltd (2011) SC1127.

14. The plaintiff argues that the defendants’ application based on the three grounds specified under Order 12 Rule 40(1) of the National Court Rules should be refused and dismissed as:

1. The pleadings in the statement of claim sufficiently set the foundation for the plaintiff’s claim based on contract and the elements of a valid and enforceable contract are pleaded.
2. The requirement for a disposition of an interest in land in writing from the third defendant to the plaintiff under Section 2(1)(c) of the Fraud and Limitations Act, has been sufficiently discharged and it is demonstrated by correspondence or emails on the subject circulated by appropriate personnel within the third defendant company. In the email from the third defendant’s Trent Coligan, Director of Corporate Affairs to the first defendant Joe Lalie dated 10 December 2014 (annexure G, affidavit of Mariah Lawi), Mr. Coligan states that on or about 28 August 2009, the Property was offered to the plaintiff to purchase at a price of K180,000.00.
3. The defendants are estopped from moving the application as they filed a similar application before, which was withdrawn on 1 August 2019 by agreement of the parties and for the matter to be progressed to trial.
   

LAW - CAUSE OF ACTION, FRIVOLITY/VEXATION & ABUSE OF PROCESS

15. The legal principles that apply in relation to applications to dismiss proceedings under Order 12 Rule 40(1) of the National Court Rules are well settled in this jurisdiction and have been the subject of many decisions in both the Supreme Court and the National Court such as Philip Takori v Simon Yagari (2008) SC905; Telikom PNG Limited v ICCC & Digicel (PNG) Limited (2008) SC906; and Kerry Lerro v Philip Stagg (2006) N3050.

16. These principles are:

“1. Our judicial system should never permit a plaintiff or a defendant to be “driven from the judgment seat” in a summary way, “without a Court having considered his right to be heard.” A party has a right to have his case heard, as guaranteed by the Constitution and the laws of the land. The Rules are designed to enhance those rights and to ensure the prompt and fair disposal of matters coming before the Court. That right cannot be lightly set aside.

2. At the same time however, the law such as the Rules under consideration provide for and the Court has an inherent jurisdiction to protect and safeguard against any possible abuse of the processes of the Court.
3. The object of these rules are therefore “to stop cases which ought not to be launched — cases which are obviously frivolous or vexatious or obviously unsustainable.” In other words “the object of the rule was to get rid of frivolous actions.”
4. A claim may be frivolous if it can be characterized as so obviously untenable that it cannot possibly succeed or that the claim or defence is bound to fail if it proceeds to trial.
5. A claim or defence may be vexatious if the case amounts to a sham or one which cannot succeed and is one that amounts to harassment of the opposing party who is unnecessarily put to the trouble and expenses of defending or proving the claim.
6. With regard to the issue of disclosing a reasonable cause of action or defence, the Court must be clear that there are two (2) parts to the phrase “cause of action”. First, it entails a right given by law such as an entitlement to reasonable damages for breach of human rights under s.58 of the Constitution, commonly referred to as the “form of action”. Secondly, it entails the pleadings disclosing all the necessary facts which give rise to the form of action.
7. The phrase “cause of action” could thus be defined in terms of a legal right or form of action known to law with:

“every fact which it would be necessary for the plaintiff to prove, if traversed, in order to support his right to the judgment of the court. It does not comprise of every piece of evidence which is necessary to prove each fact, but every fact is necessary to be proved.”

8. A statement of claim or a defence (as the case may be) must therefore clearly plead the form of action by pleading the necessary legal elements or ingredients of the action and relevant and necessary facts (not the evidence) giving rise to the form of action. It follows therefore that, where a statement of claim or a defence is so ambiguous or lacking in particularity that it does not facilitate orderly and rational pleadings, which would enable the real issues to be identified, and instead leaves it to guess work, it should be struck out.
9. These rules provide a summary judgment procedure or remedy which is available to a plaintiff or a defendant, and one which vests and calls for an exercise of a discretion by the Court.
10. The discretion must be exercised sparingly and only in a case where the statement of claim or the defence (as the case might be) is “obviously and almost incontestably bad.” In other words, this discretion can be exercised only in cases that “are plain and obvious so that the master or Judge can say at once that the statement of claim [or defence] as it stands, is insufficient, even if proved, to entitle the plaintiff [defendant] to what he asks for.

[11]. [T]he pleadings must be so bad and or vague and is not a case of lack of particulars or a lack of better pleading which cannot be cured by a request and or orders for further and better particulars and or amendment respectively under O.8, rr. 36, 50 or 51 of the Rules. Lack of particulars or lack of better pleadings is distinctly separate from a failure to disclose a reasonable cause of action or an action that is frivolous, vexatious or harassment. As such, clear and separate consequences follow. There is provision under the rules for requesting and or orders for further and better particulars or better pleadings as opposed to a right in a defendant or an opposing party to apply for a dismissal straightaway. A party must be careful not to ask for and the Court must stop to ensure that it is not being asked to dismiss a claim because of lack of particulars or lack of proper pleading which can be cured by appropriate amendments to the pleadings. Regard must also be had to the fact that the Rules are not an end in themselves but a means to an end and by reason of which a strict compliance of the Rules can be dispensed in the interest of doing justice in accordance with O.1, r.7 of the Rules in appropriate cases.”

17. On every occasion that a person brings a case to court, the originating document must demonstrate that the plaintiff has a cause of action. That document must clearly set out the essential elements of the claim and the facts that support each of those elements. Only when the originating document demonstrates that, is there a reasonable cause of action: Kiee Toap v The State (2004) N2731, Tigam Malewo v Keith Faulkner (2009) SC960, Mt Hagen Urban Local Level Government v Sek No. 15 Ltd (2009) SC1007 and Hendrikus Derks v John Bray (2018) N7665.

18. The Court’s power to stay or dismiss proceedings under any of the grounds specified in Order 12 Rule 40 (1) is discretionary.

19. By its inherent jurisdiction, the Court has power to protect and safeguard any abuse of its processes: Anderson Agiru v Electoral Commission and The State (2002) SC687; The State v Peter Painke (1976) PNGLR 210, The State v Peter Painke (No.2) (1977) PNGLR 141.

20. Under Order 12 Rule 40, the Court may stay the proceedings or dismiss the proceedings, either generally or in relation to any claim for relief in the proceedings. Evidence may be received by the Court on the hearing of an application for an order under this rule.

21. In Anderson Agiru v Electoral Commission and The State (2002) SC687, the Supreme Court explained abuse of process in the following terms:

“.... the court’s inherent power is its authority to do all things that are necessary for the proper administration of justice. Such inherent power consists of all powers reasonably required to enable the court to perform efficiently its judicial functions and to protect its dignity and integrity. Essential to these inherent powers is the court’s duty to protect itself by ensuring that vexatious litigants do not abuse the court’s process by instituting frivolous or vexatious suits.....

In The State v Peter Painke [1976] PNGLR 210, O’Leary AJ emphasized that:

“mere motive, however reprehensible, will not be sufficient” (to constitute abuse of process) “it must be shown that, in the circumstances in which the interposition of the court is sought, the remedy would be unsuitable, and would enable the person obtaining it fraudulently to defeat the rights of others, whether legal or equitable”.

The court must ensure that a multiplicity of proceedings is not commenced by unsuccessful litigants. That is that a litigant having selected one mode of proceeding and having failed to obtain a remedy, cannot generally be entitled to then institute an alternative proceeding seeking the same remedy that was denied in the earlier proceeding.”

22. The circumstances in which an abuse of process can arise are very varied: Hunter v Chief Constable of the West Midlands Police and Others [1981] UKHL 13; (1982) AC 529 per Lord Diplock at page 536, House of Spring Gardens Ltd v Waite (1991) 1 QB 241 per Stuart-Smith LJ, Telikom PNG Limited v ICCC & Digicel (PNG) Limited (2008) SC906.

FILING OF MOTION

23. The Court’s records show that the defendants filed their motion:

1. after a notice to set down for trial endorsed by the parties stating that pleadings had closed and that there were no further interlocutory steps to complete prior to the filing of the notice on 6 November 2019; and
2. while the matter was being processed through directions hearing with certain directions having already been issued on 12 March 2020 to progress the matter to trial.
   

24. This issue was not raised by the parties at the hearing, but as I have alluded to above, by its inherent jurisdiction, the Court has power to protect and safeguard any abuse of its processes. The conduct of the defendants in filing the motion is contemptuous of the directional orders issued on 12 March 2020 which are current and have not been set aside. Leave has not been specifically sought in the motion. Hence, the filing and moving of the motion without leave amounts to an abuse of the process of the Court. This warrants the dismissal of the motion.

25. Notwithstanding the summary dismissal of the motion by the Court of its own volition, I propose to discuss below the merit or otherwise of the motion as if it were properly before the Court.

CAUSE OF ACTION

26. In Steven Naki v AGC (Pacific) Ltd (2005) N2782, the Court upon making reference to A G Guest, Chitty on Contracts, 27^th Edition, Sweet & Maxwell, 1994, pp 89-90 observed that the essential elements of a contract are:

1. agreement between the parties;

2. an intention to create legal relations; and

3. support of the agreement with consideration.

27. In Steven Naki v AGC (Pacific) Ltd (2005) N2782, the Court also observed that the elements of a cause of action in breach of contract are:

1. there was an enforceable contract between the parties;
2. the defendant breached the contract; and
3. the breach of contract caused damage to the plaintiff.

28. Section 4 of the Frauds and Limitations Act 1988 prevents an action being brought upon a contract for the sale of land that is not in writing. Section 4 (Contracts for the sale of land, etc) states:

“No action shall be brought upon a contract for the sale or other disposition of land or an interest in land unless the contract, or some note or memorandum of the contract, upon which the action is brought is in writing signed—

(a) by the person against whom the action is brought; or

(b) by an agent of that person lawfully authorized in writing for the purpose.”
29. Section 4 has been applied in numerous cases, eg Active Auto Parts (PNG) Pty Ltd v Brian Hull (1990) N833, Jacobs v Kwaindu [1991] PNGLR 366, Pamela Ipi Pangu v Ian Ellery (2007) N3227 and Sonny Atua v Grace Kemmah (2011) N4296.

30. In Jacobs v Kwaindu (1991) PNGLR 366, Justice Los held that a "letter from the purchaser to the bank was a sufficient note or memorandum for the purpose of Section 4 of the Fraud and Limitations Act.

31. In the present case, I am of the view that the pleadings in the statement of claim are drafted in sufficiently broad terms to demonstrate or accommodate an action in contract for the sale of land or an interest in land and for alleged breach of the same which is supported by the plaintiff’s own affidavit to which is annexed copies of; a page of the third defendant’s Ancillary Staff Terms and Conditions regarding its Housing Scheme, Staff Debtor Transaction History; a quotation from MJR Construction to the plaintiff dated 14 February 2013; copies of payments made; and an email from the third defendant’s Director Corporate Services, Trent Coligan to the first defendant dated 10 December 2014 which may be relied on for purposes of Section 4 of the Fraud and Limitations Act. Hence, these proceedings do disclose a reasonable cause of action and do not warrant dismissal.

32. It follows that the proceedings also are neither frivolous or vexatious nor are they an abuse of the process of the Court.

33. It is now not necessary to address the other arguments raised by the parties.

ORDER

34. The formal orders of the Court are:

1. The defendants’ notice of motion filed on 30 October 2020 is dismissed.
   2. The defendants shall pay the plaintiff’s costs of and incidental to the defendants’ notice of motion filed on 30 October 2020, which shall, if not agreed, be taxed.
   3. Time is abridged.

________________________________________________________________
Public Solicitor: Lawyer for the Plaintiff

Mel & Hennry: Lawyers for the Defendants