Abraham v Fontenu [2022] PGNC 104; N9569 (25 March 2022)

N9569

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

WS NO. 199 OF 2021


BETWEEN:
NAOMI ABRAHAM
Plaintiff

AND:
LIVINGSTONE FONTENU
Defendant

Goroka: Mugugia, AJ
2022: 24^th & 25^th March

PRACTICE AND PROCEDURE – Plaintiff’s application for default judgment - failure to file defence - National Court Rules, Order 12, Rule 25(a) and (b), Rule 31 and Rule 32(1) relied on by the Plaintiff – whether default judgment should be entered against the Defendant – considerations – exercise of discretion - default judgment entered against the Defendant with damages to be assessed.
Case Cited:

Giru v. Muta (2005) N2877

Counsel:

K. Lafanama, for the Plaintiff
O. Dekas, for the Defendant

RULING

25^th March, 2022
1. MUGUGIA, AJ: The proceedings against the Defendant was instituted on 19 May 2021. The Defendant failed to file his defence which prompted the Plaintiff to file her motion for default judgment against him on 25 February 2022. I heard the motion on 24 March 2022. Counsel representing the Defendant opposed the application. I have considered the Plaintiff’s application, the materials before me, and submissions by Counsel. This is my ruling on the motion.

BACKGROUND

2. The Plaintiff’s claim is that in or around early August 2018, the Defendant who had a relationship with her, requested to borrow K10,000.00 from her to engage a lawyer. Based on an undertaking made by the Defendant to help her meet the full cost of the loan amount, she applied for a K10,000.00 loan at the Bank of South Pacific in Port Moresby on 17 August 2018. She gave the full amount of K10,000.00 in cash to the Defendant. The Defendant then asked her for another K10,000.00 in early September 2018 to pay for his rental accommodation while attending studies in the United Kingdom, and for his other needs. The Defendant assured her that he would help her settle the total cost of the loan as soon as he received his allowances from the scholarship. The Plaintiff claims that she had entered into a contract with the Defendant to repay the loan with interest. The terms of the contract are pleaded in the statement of claim. The Plaintiff claims that the Defendant breached the contract. She then filed this proceeding, claiming special damages in the sum of K55,000.00, general damages, interest and costs.

ISSUE

3. The issue for determination is whether default judgment should be entered against the Defendant.

THE LAW

4. Order 12, Rule 25(a) and (b) of the National Court Rules reads:

“25. Default.

A defendant shall be in default for the purposes of this Division

(a) where the originating process bears a note under Order 4 Rule 9, and the time for him to comply has expired but he has not given the notice; or

(b) where he is required to file a defence and the time for him to file his defence has expired but he has not filed his defence. “

5. Order 12, Rule 31 of the National Court Rules reads:

“31. Mixed claims.

Where the plaintiff's claim for relief against a defendant in default includes two or more of the claims for relief mentioned in Rules 27 to 30, and no other claim, the plaintiff may enter such judgement against that defendant on any of those claims for relief as he would be entitled to enter under those Rules if that were the plaintiff s only claim for relief against that defend.

6. Order 12, Rule 32(1) of the National Court Rules reads:

“32. General.

(1) Whatever claims for relief are made by a plaintiff, where a defendant is in default, the Court may, on application by the plaintiff, direct the entry of such judgement against that defendant as the plaintiff appears to be entitled to on his writ of summons.”
7. Cannings J set out six (6) pre-conditions that should be considered in an application for default judgment in Giru v. Muta (2005) N2877. These pre-conditions are:

1. Proper form.
2. Service of notice of motion and affidavits.
3. Default.
4. Warning.
5. Proof of service of writ.
6. Proof of default.

8. His Honour held that if all the items on the checklist are satisfied, the matter is ripe for entry of default judgment. However, a plaintiff is not entitled to default judgment as of right. Entry of default judgment is a matter for the discretion of the court.

PLAINTIFF’S SUBMISSIONS

9. The Plaintiff’s lawyer Ms Lafanama relied on the following documents in support of her client’s application for default judgment:

i) Affidavit in Support filed on 25 February 2022;
ii) Affidavit of Search filed on 25 February 2022;
iii) Affidavit of Service filed on 20 September 2021;
iv) Affidavit of Service filed on 1 October 2021;
v) Affidavit of Service filed on 23 March 2022; and
vi) Affidavit of Recent Search filed on 23 March 2022.

10. Ms Lafanama relied on her extract of submissions filed in Court on 23 March 2022. The case relied on is the case of Tzen Pacific Ltd v. Puana (2011) PGNC 310. Ms Lafanama applied the law in Tzen Pacific Ltd v. Puana to the facts of this case. She submitted that the Plaintiff is claiming both liquidated and unliquidated damages (special damages and general damages). The National Court Rules relied on in the motion are correct.

11. The case of Bank South Pacific Ltd v. Robert Tingke [2012] PGNC 250 sets out the two legs of formalities for default judgment to be entered.

11.1. In applying the first leg of formalities to the present case, Ms Lafanama made these submissions:

• The Defendant was duly served with the writ of summons. Although the Defendant refused to sign the acknowledgement of service form at the Vision City Mall on 30 May 2021, service was in compliance with Order 6, Rule 3(1) of the National Court Rules. The writ of summons with the statement of claim was also sent to the Defendant by WhatsApp and emailed to him which he acknowledged, and made an undertaking to make a payment of K10,000.00 on 1 June 2021.
  
• From the date of service, the Defendant had 44 days to file his defence. The notice of intention to defend was to be filed by 17 June 2021, and the defence by 29 July 2021. However, these documents were not filed within the required time period.
  
• After the first file search was conducted on 30 August 2021, the Plaintiff advised the Defendant in a letter dated 24 September 2021 of the default and that proceedings would ensue.
  
• The Defendant did not respond to the Plaintiff’s request to have the matter resolved out of Court. The first default judgment application was filed on 5 November 2021. It was withdrawn by consent.
  
• Although the Plaintiff did not forewarn the Defendant at the time running, the letter dated 24 September 2021 was an attempt by her in ensuring that the matter progressed. Without further action taken by the Defendant, an application for default judgment was brought by the Plaintiff which prompted the Defendant to seek further legal assistance. He filed an application for extension of time to file a defence
  
• The first leg of formalities for default judgment to be entered has been satisfied by the Plaintiff.
  

11.2. In relation to the second leg of formalities for default judgment to be entered, Ms Lafanama submitted that the Plaintiff has a clear cause of action for breach of contract, the particulars of which have been properly and sufficiently pleaded. The draft defence as provided by the Defendant in his application for extension of time to file a defence does not provide a defence on merit.

11.3. Ms Lafanama submitted that both the first and second legs of formalities for default judgment have been satisfied, and this Court in exercising its discretion should enter orders against the Defendant for default.

DEFENDANT’S SUBMISSIONS

12. The Defendant did not file any responding affidavit. His lawyer Mr Dekas did not file any written submissions. He made short oral submissions at the hearing. He admitted that his client had defaulted. He submitted that Order 12, Rule 25 of the National Court Rules which was relied on by the Plaintiff is the wrong jurisdictional basis. The correct jurisdictional basis is Order 12, Rule 27 because the Plaintiff’s claim is a liquidated claim, and not a mixed claim. General damages, interest and costs which are claimed in the statement of claim are consequential orders.

13. In relation to the Plaintiff’s pleadings, Mr Dekas submitted that there was no contract. The money given to his client was based on a relationship.

14. The forewarning letter given by the Plaintiff was for the first motion which was withdrawn by consent.

CONSIDERATION

15. I am convinced by Ms Lafanama’s submissions.

16. Order 12, Rule 32 of the National Court Rules gives the Court a wide discretion to enter or not to enter, default judgment. Therefore, the check-list set out in the case of Giru v. Muta are relevant in determining whether or not default judgment can be entered.
17. I apply the 6 pre-conditions in Giru v. Muta in this case. These are my findings:

17.1. The notice of motion for default judgement is in the proper form. The jurisdictional basis cited by the Plaintiff in the motion is correct.

17.2. The Plaintiff’s motion was supported by the affidavit of Naomi Abraham filed on 25 February 2022. Both the motion and affidavit in support were served on the Defendant.

17.3. The affidavit of Naomi Abraham filed on 25 February 2022 shows the Defendant’s default.

17.4. The Plaintiff’s letter dated 24 September 2021 to the Defendant put him on notice.

17.5. The Plaintiff’s writ of summons was served on the Defendant. There is proof of service. The Defendant acknowledged receipt of the writ of summons, and made an undertaking to make a payment of K10,000.00 to the Plaintiff.

17.6. A search of the court file was done by the Plaintiff’s lawyer on 30 August 2021. No defence was filed by the Defendant. Another Court file search was done on 1 November 2021. The Plaintiff filed the Affidavit of Search of Karen Lafanama on 25 February 2022 to confirm that the Court file searches were done. Ms Lafanama did a recent search at the registry. She confirmed that a notice of intention to defend was filed by the Defendant on 24 November 2021, with a notice of motion seeking leave to file a defence out of time.

17.7. No defence was filed by the Defendant. He is clearly in default.

CONCLUSION

18. The Defendant has clearly defaulted. The basis on which the Plaintiff’s application was made is on account of his default under Order 12 Rule 25(b) of the National Court Rules.

19. The Plaintiff has made out a case for default judgment to be entered against the Defendant for failure to file his defence. I exercise my discretion and enter default judgment against the Defendant with damages to be assessed.

FORMAL ORDERS:

20. These are the formal orders of the Court:

1. Default judgment is entered against the Defendant with damages to be assessed.

2. Costs will be paid by the Defendant.

3. Time for entry of these orders is abridged to the date and time of settlement of these orders by the Registrar which shall take place forthwith.

The Court orders accordingly.

________________________________________________________________
K. Lafanama: Lawyer for the Plaintiff
O. Dekas: Lawyer for the Defendant