Pride PNG Ltd v New Britain Enterprises Ltd [2020] PGNC 504; N8540 (13 July 2020)

N8540

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

WS NO. 1173 OF 2019

BETWEEN
PRIDE PNG LIMITED
Plaintiff

AND
NEW BRITAIN ENTERPRISES LIMITED
First Defendant

AND
DOMINGO VILLAR
Second Defendant

Kokopo: Suelip AJ
2020: 19^th March, 18^th May, 26^th June & 13^th July

CIVIL - PRACTTCE AND PROCEDURE - application for default judgement abandoned - plaintiff seeking summary judgment instead - Order 12 rule 8(1) of the National Court Rules - defendants filed defence out of time without leave - elements for considering summary judgement - one element not satisfied - application for summary judgment refused
Cases Cited

Bruce Tsang v Credit Corp [1993] PNGLR 112 William Duma v. Eric Meier (2007) SC 898 Rachel Kove v Tau Po'o (2017) N8366
Cletus Kaiun v. Roland Kun (2019) N8350

References

National Court Rules Ch No. 38
Counsel

Paul Yange, for the Plaintiff
Cecelia Pulapula, for the Defendants

RULING

13^th July, 2020

I. SUELIP AJ: I have a notice of motion filed on 29 July 2019 by the plaintiff seeking default judgment and alternatively, summary judgment. In the initial stages of making the application, the plaintiff sought leave to abandon paragraphs 1 and 2 of its notice of motion seeking default judgment. Leave was granted to abandon paragraphs 1 and 2 of the notice of motion. The plaintiff is now only seeking the order in the alternative, that the defence filed 24 May 2019 be struck out and summary judgment be entered for the plaintiff.
2. The plaintiff's application was heard on 16 June 2020 and I reserved my
ruling.
3. This is now my ruling.

Facts

4. On 8 December 2016, a Contract of Sale was executed between the plaintiff as the purchaser, and the first defendant as the vendor, for a property described as Allotment 11 Section 21, Kokopo, East New Britain Province ("the property"). This property is also described as State Lease Volume 9 Folio 88. The purchase price is Kl .2 million.

5. Warner Shand Lawyer acted for both parties in this conveyance although in their Defence, the defendants deny that firm acted for them. The purchase price was paid on instalments to the defendants through the lawyer's trust account to various entities and persons. The plaintiff has since paid a total sum of Kl,269,260.00 which is inclusive oflawyer's fees, outgoings and agents fees.
6. The Defendants filed a Defence on 24 May 2019, which defence was filed out of time by 27 days without leave of the Court.

Notice of Motion

7. The Plaintiff is seeking orders in paragraph 3 of its notice of motion, which reads:

3. In the alternative, the Defence filed on 24 May 2019 be struck out and judgment be entered for the plaintiff pursuant to Order 12 rule 38(1) of the National Court Rules as to the following:-

(i) defendants to surrender to the plaintiff the State Lease Title to the property described, and vacate the property within 7 days from the date of the orders;

(ii) return to the plaintiff its total liquidated claim of

Kl,269,260.00 within 7 days from the date of the order.

Issue
8. Whether the plaintiff has made out a clear case for the entry of summary
judgement?

Law

9. For the first part of the application, the plaintiff is seeking that the defence be struck out. However, it did not plead the jurisdictional basis for striking out the defence. There were also no submissions made and so this part is disregarded.

10. For the second part of the application, the plaintiff relies on Order 12 rule 38(1) of the National Court Rules (NCR) which provide:

38. Summary Judgement. (1312)

(1) Where, on application by the plaintiff in relation to any claim/or relief or any part of any claim for relief of the plaintiff -

(a) there is evidence of the facts on which the claim or part is based; and

(b) there is evidence given by the plaintiff or by some responsible person that, in the belief of the person giving the evidence, the defendant has no defence to the claim or part, or no defence except as to the amount of any damages claimed,

the Court may, by order, direct the entry of such judgement for the plaintiff on that claim or part, as the nature of the case requires.

11. There are 2 elements involved when the Court is considering an application for summary judgement and these are:-

(i) evidence of the facts proving the essential elements of the claim; and

(ii) that the plaintiff or some responsible person gives evidence that in his belief there is no defence.

12. The Court considered these elements in the Supreme Court case of Bruce Tsang v Credit Corp [ 199 3] PNGLR 112. In that case, the Court stated that "If a defence is filed or evidence is given by the defendant ... the plaintiff must show that, upon the facts and/or the law, the defendant has no defence. The plaintiff is not entitled to summary judgment if there is a serious conflict of fact or law" ...

13. In William Duma v. Eric Meier (2007) SC 898, the Court said:

"The discretion conferred on the Court should be exercised in a clear case and with considerable care. Summary judgment should be granted only where there is no serious triable issue or fact or law. If there is no dispute as to fact and there is clear admission of the claim or part of the claim then judgment must be entered for the plaintiff"

14. In Rachel Kove v. Tau Po 'o (2017) N8366 and Cletus Kaiun v. Roland Kun (2019) N8350, Hartshorn J, in both cases, referred to the case of Christopher Smith v. Ruma Construction Ltd (2000) N1982 where Sakora J sets the test to be applied regarding the wording of Order 12 rule 38(1) of the National Court Rules. The test is:
    • (i) the applicant must verify by affidavit evidence the cause of action;

(ii) the applicant must swear to a belief on his part that the respondent has no defence to the cause of action ( or the pleadings);

If the Court has been satisfied in respect of (i) and (ii), then the onus is on the respondent to:-

(iii) show an arguable defence or that there is a real question to be tried.
Consideration

15. In the affidavit of the director of the plaintiff, one Wan Song Lin sworn 26 July 2019 and filed 29 July 2019, he deposes with particularity as to his claim against the defendants. He annexes extracts of the plaintiff company and the first defendant company, respectively. In the first defendant's company extract, the second defendant is the sole director. Mr Lin also annexes the Contract of Sale executed by his company and the first defendant. He further annexes a copy of the conveyance lawyer firm's trust account to prove instalment payments to the first defendant and other persons. It is clear from this affidavit that the cause of action is one of contract, particularly a sale of real property which has not been completed. The first element involved in satisfying the Court in an application for summary judgement is therefore made out.

16. The second element is that the applicant must swear to a belief on his part that the respondent has no defence to the cause of action ( or the pleadings). As I read through the affidavit of the applicant's director, I do not find any statement saying that he believes that the respondent has no defence to his claim. Thus, the second element is not satisfied.

17. Since one of the 2 elements is not satisfied, there is no obligation on the respondent to show an arguable defence or that there is a real question to be tried.

Summary

18. Having found that one of the 2 elements considered by the Court in an application for summary judgment is not satisfied by the plaintiff, I am not satisfied that the plaintiff has made out a clear case for the entry of the summary judgement he seeks. Hence, I make the following orders:

1. The Notice of Motion filed by the plaintiff on 29 July 2019 is refused.
2. Cost of and incidental to the application is awarded to the defendant to be taxed if not agreed to.

_______________________________________________________________
Island Legal Services: Lawyers for the Plaintiff
Public Solicitors: Lawyers for the Defendants

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