Akipe v Livestock Development Corporation Ltd [2021] PGNC 650; N9856 (2 September 2021)

N9856

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

WS NO. 100 OF 2015

JOHN AKIPE
Plaintiff

-V-

LIVESTOCK DEVELOPMENT CORPORATION LIMITED
Defendant

Waigani: Kariko, J
2021: 2^nd September

DAMAGES – assessment of – breach of contract – default judgement – applicable principles – proof

Following the entry of default judgment in his favour in his claim for unlawful termination due to breach of contract of employment, the plaintiff sought payment of outstanding entitlements and general damages.

Held:

1. The plaintiff has the onus of proving his claim based on credible and corroborated evidence.
2. The claim for general damages must be particularized in the pleadings.
3. The claim for unpaid entitlements and general damages are refused.
   

Cases Cited

Steven Naki v AGC (Pacific) Ltd (2006) N5015
The Central Bank of PNG v Gabriel Tugiau (2009) SC1013
William Mel v Coleman Pakalia and Others (2005) SC790

Counsel

Ms J Nandape, for the Plaintiff
Mr L Tangua, for the Defendant

ASSESSMENT

This was a trial on assessment of damages

2^nd September, 2021

1. KARIKO, J: This decision follows a hearing on assessment of damages.
   
2. Default judgment was entered against the defendant (LDC) on 4^th December 2015 for the unlawful termination of his employment by the defendant as its Managing Director, in breach of his contract of employment (the Contract).
   
3. In relation to damages, the plaintiff claims K190,287.00 as unpaid final entitlements, and general damages for breach of contract.
   

PLAINTIFF’S EVIDENCE

4. The plaintiff tendered into evidence four (4) of his own affidavits, without objection:
   
   • Affidavit sworn on 13.04.15 and filed on 16.04.15 (Exhibit P1)
   • Affidavit sworn on 14.08.15 and filed on 18.08.15 (Exhibit P2)
   • Further affidavit sworn and file on 26.10.16 (Exhibit P4)
   • Further affidavit sworn on 04.11.16 and filed on 07.11.16 (Exhibit P5)
     
5. The affidavit of Theresia Bob, a private accountant, sworn on 25.01.16 and filed on 26.01.16 (Exhibit P3) was also similarly tendered as evidence.
   
6. The affidavits affirm that the Contract was executed on 16^th February 2010 for a term of four (4) years commencing 3^rd March 2010 and expiring on 3^rd March 2014.
   
7. LDC is a commercial enterprise that is wholly owned by the State, operating in activities such as abattoirs and sale of livestock.
   
8. On 6^th December 2013, the then Minister for Agriculture & Livestock, who was responsible for LDC on behalf of the State as the sole shareholder, passed a shareholder’s resolution that terminated the plaintiff. This was 3 months short of the expiration of his term of employment under the Contract.
   
9. However, the plaintiff was not made aware of the resolution until 14^th January 2014, and he received his letter of termination from the Minister on 17^th January 2014, some 6 weeks before the Contract was due to end. The letter explained that the termination was because the company records did not show the plaintiff as a director of LDC, and he could no longer continue as the Managing Director.
   
10. The plaintiff, who was employed on the equivalent of Executive Level 4 of the Public Service, was not paid his final entitlements following his termination.
    
11. He engaged Tee Bee Accountants who calculated the outstanding entitlements to total K190,287.00 (the Calculations), made up of these amounts for the respective entitlements provided under the Contract:
    
    • Payment in lieu of notice (clause 20.4(a)) – K52,404.00
    • Annual recreational leave (clause 20.5) – K14,512.00
    • Long service leave (clause 20.4(a)) – K39,721.00
    • Ex gratia payment (clause 12 &20.5) – K73,099.00
    • Gratuity (clause 20.4(a)) – K4,343.00
    • Housing & vehicle allowance (clause 20.4(a)) – K6,743.00
      
12. Theresia Bob, the principal of Tee Bee Accountants and the then accountant for LDC, prepared the Calculations. She assessed the outstanding entitlements by referring to the Contract, information received from staff of LDC, and advice obtained from the Internal Revenue Commission.
    

DEFENDANT’S EVIDENCE

13. The defendant tendered one affidavit as evidence - an affidavit by Dr Vele Pat Ila’ava, the Secretary for the Department of Agriculture & Livestock, who was appointed as the Chairman of the LDC Board on or about the same time that the plaintiff was terminated.
    
14. The plaintiff opposed the receipt of the affidavit as evidence on the ground that it was filed outside of the time ordered by the court. I overruled the objection and allowed the affidavit as Exhibit D1, after noting that the plaintiff had also tendered an affidavit filed out of time, and upon deciding that I would consider its probative value as against its prejudicial value when considering all the evidence. This I now do.
    
15. The Secretary suggested that the plaintiff as the head of the management of LDC should have been able to provide better evidence, and particularly details of what entitlements he was paid while in office and those he did not receive.
    
16. Dr Ila’ava produced copies of documents that show the plaintiff was advanced a total of K65,000 as housing allowance in 2013, and a copy of a LDC pay advice slip for the fortnight 3 February 2014 to 16 February 2014 that shows the plaintiff was paid his fortnightly salary of nett K3,854.55.
    
17. The authenticity of these documents was not challenged. Considering that the issue on trial is what entitlements are still due to the plaintiff and for what amounts, I find the evidence quite relevant and of no prejudice to the plaintiff. Plainly, it is evidence that will help properly determine the plaintiff’s claim.
    

CONSIDERATION

18. I bear in mind the relevant principles in relation to assessment of damages endorsed by the Supreme Court in the case of William Mel v Coleman Pakalia and Others (2005) SC790 and summarized by Cannings, J in Steven Naki v AGC (Pacific) Ltd (2006) N5015:
    
    • (1) The plaintiff has the onus of proving his loss on the balance of probabilities.
    • (2) Corroboration of a claim from an independent source is usually required.
    • (3) The principles of proof and corroboration apply even when the defendant fails to present any evidence disputing the claim.
    • (4) Where liability has been established, injury or damages suffered must be proved by credible evidence.
    • (5) If the evidence and pleadings are confusing, contradictory and inherently suspicious, the plaintiff will not discharge the onus of proving his losses on the balance of probabilities, and a plaintiff may be awarded nothing.
    • (6) Where default judgment is granted, the evidence must support the facts pleaded. No evidence will be allowed in support of facts that are not pleaded.
    • (7) The fact that damages cannot be assessed with certainty does not relieve the wrongdoer of the necessity of paying damages. Where precise evidence is available the court expects to have it. However, where it is not, the Court must do the best it can.
    • (8) The person who has been wronged has a duty to mitigate the losses; though it is the defendant who has the onus of proving failure to mitigate.
      

Outstanding entitlements

19. In relation to his claim for outstanding entitlements, the plaintiff relies essentially on the Calculations, which comprise worksheets on each of the claimed entitlements. A summary of the total claim is also included.
    
20. The difficulty in basing the claim on the worksheets is that, except for the Contract, none of the source documents are identified or produced. Theresia Bob said she got the relevant material from staff of LDC, but there are no details of the nature of that material. Contrary to this witness’ evidence that she did the Calculations, the worksheets show that they were prepared by one Freida Taian, but that person did not sign off on them. It appears the worksheets were meant to be verified by another officer, but this was also not done. The Calculations therefore lack credibility and cannot be relied upon as this evidence is hearsay.
    
21. There are other aspects of the plaintiff’s evidence that are not convincing or reliable. For example, the plaintiff does not state when he left the employment, although he gives the impression that it was upon his termination. This is inferred from the fact that the Calculations refer to 3 months’ salary in lieu of notice. However, the evidence suggests that even though the decision to terminate the plaintiff was made on 6^th December 2013 and he was notified of the decision on 17^th January 2014, the plaintiff was still working on 17^th February 2014, a mere 2 weeks before the expiry of the Contract. The pay slip produced by the defendant confirms that. On another point, while the Calculations suggest the plaintiff was paid K17,608.00 housing allowance, documentary evidence presented by the defendant show that he was advanced K65,000.00 as housing allowance by his employer in 2013.
    
22. I find it puzzling that the plaintiff only relied on the Calculations and nothing more. The Contract alone does not determine the amount due as outstanding entitlements. The records kept in the plaintiff’s employment file would be a good source, but the records were unavailable. The plaintiff could have offered his copies of these records, such as pay slips, advice on previous recreational leave, and statements of previous payments of allowance.
    
23. It is assumed that upon leaving LDC and before filing this suit, the plaintiff would have queried his former employer about the outstanding entitlements. One would expect therefore that there might be evidence of enquiries made, responses from LDC and follow-ups, but there is none. Perhaps, as intimated by Dr Ila’ava, there are no unpaid entitlements due to the plaintiff.
    
24. In the circumstances, I find that the plaintiff’s claim for outstanding entitlements has not been corroborated by an independent source. The evidence by Theresia Bob is unreliable and lacks credibility, while the plaintiff’s own evidence is inadequate. No damages in respect of this claim is allowed.
    

General damages

25. While the plaintiff seeks general damages, this claim is not particularized in the pleadings. It was submitted on his behalf that he suffered stress and frustration because of his termination. However, there is no evidence in support of this statement.
    
26. In The Central Bank of PNG v Gabriel Tugiau (2009) SC1013, the plaintiff failed in his claim for damages for psychological effects, stress, embarrassment and shame because he failed to properly particularize the claim, and he did not present evidence in support of the claim.
    
27. For similar reasons, I do not award any damages under this heading. The relief has no proper foundation in the pleadings, and the plaintiff has not produced proper evidence in support.
    

ORDER

28. The Court orders that:
    
    • (1) No damages are awarded in respect of the plaintiff’s claim for outstanding entitlements and general damages.
    • (2) The plaintiff shall pay the defendant’s costs of and incidental to this trial on damages, to be taxed if not agreed.
    • (3) Time for entry of this order is abridged to the date of settlement by the Registrar which shall take place forthwith.
      

Nandape & Associates: Lawyer for the Plaintiff
Baniyamai Lawyers: Lawyer for the Defendant