Cragnolini v Constantinou [2022] PGNC 22; N9437 (15 February 2022)

N9437

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

WS NO. 395 OF 2020

BETWEEN

CHRISTINA JOSEPHINE CRAGNOLINI

Plaintiff

AND

SIR KOSTAS GEORGE CONSTANTINOU as executor of the estate of SIR THEOPHILUS GEORGE CONSTANTINOU (deceased) and SIR GEORGE CONSTANTINOU (deceased)

Defendant

Waigani: Tamade AJ

2021: 26^th November

2022: 15^th February

NEGLIGENCE – cause of action against defendant based on breach of duty as administrator of deceased estate – plaintiff also seeks administration of the estate as well as an order for the estate to be placed in receivership for the distribution of the assets to the beneficiaries

PRACTICE AND PROCEDURE - defendant seeks dismissal of proceedings for being frivolous and vexatious and for being an abuse of the process of Court – plaintiff filed two separate proceedings raising the same issues and seeking the same relief - Defendant relies on the principle that Plaintiff should have brought forward every possible issue for determination in the first proceeding instead of instituting multiple proceedings - Defendant further alleges that by coming to court in separate proceedings Defendants have been put to task to defend these proceedings and that should be seen as an abuse of the process of the Court.

PRACTICE AND PROCEDURE – whether plaintiff’s claim is an abuse of process- Plaintiffs claims in the two proceedings are not inconsistent - Plaintiff is within her right to mount these proceedings separately - Defendant is tasked to give an account of the estate – defendant still awaiting guidance and directions from court on how to manage estate - to answer to allegations of mismanagement and breach of duty when defendant is still waiting on the Court to give direction and or guidance on the administration of the estate is prejudicial to the defendant - amounts to abuse of process – the plaintiff’s proceedings are frivolous and vexatious – proceedings dismissed

Cases Cited:

The following cases are cited and or considered in the judgement:

Papua New Guinea Cases

Anderson Aigiru v Electoral Commission (2002) SC687
AGC (Pacific) Ltd v Kipalan (2000) N1944
Eremuge v Kama [2019] (WS 951 of 2011)
Lysenko v National Airline Commission (1989) N71 & (1990) SC386
Michael Wilson v Clement Kuburam [2016] SC1489
Mt Hagen Airport Hotel Pty Ltd v Gibbes (1976) N46
National Executive Council v Public Employees Association [1993] PNGLR 264
Pokia v Yallon [2014] SC1336
Passismanua Inland Timber Resource v Nelulu Land Group [2014] SC1404
Popunawa v Owa [2017] SC1564
PNG Forest Products Pty Ltd v State (1992) N1058
Regglie v Director General National Narcotics Bureau (2009) N3805
State v Downer Construction (PNG) Ltd (2009) SC979
State v Peter Paainke [1976] PNGLR 210
Telikom PNG Limited v ICCC (2008) SC906
Timbers (PNG) Limited v Kambori (2010) N4283
Wanire v Biloi (2018) SC1721

Overseas Cases

Brisbane City Council v A-G (Qld) [1979] AC 411

Johnson v Gore Wood & Co [2002] 2 AC 1

Ling v Commonwealth [1996] FCA 1646; (1996) 68 FCR 180

Port of Melbourne Authority v Anshun (1980) HCA 41

Spencer v Commonwealth [2010] HCA 28

Tanning Research Laboratories Inc v O’Brien [1990] HCA 8

Counsel:

Mr Ian Molloy and Mr Anthony Paru, for the Plaintiff

Mr R J Webb SC and Ms Jeanale Nigs, for the Defendant

15^th February, 2022

1. TAMADE, AJ: These are proceedings challenging the execution and administration of the estate of the Late Sir George Constantinou. Sir Kostas George Constantinou is the current executor of the estate of both Sir George Constantinou and is also the executor of the estate of Sir Theophilus George Constantinou. Upon the passing of Sir George Constantinou on 16 December 2006, the administration of his estate was granted to Sir Theophilus George Constantinou, however Sir Theophilus subsequently passed, and the administration of his estate was granted to Defendant Sir Kostas George Constantinou. Sir Kostas George Constantinou is therefore sued in his capacity as the executor of the estate of Sir Theophilus and Sir George.

2. Plaintiff is one of the beneficiaries to the estate of Sir George and claims against Defendant Sir Kostas (and also against the estate of Sir Theophilus) as executor(s) of the estate of Sir George.

3. The Plaintiff claims damages for negligence and breach of duty over the administration of the estate of Sir George against the estate of Sir Theophilus and Sir Kostas as executors and also seeks administration of the estate of Sir George as well as an order for the estate of Sir George to be placed in receivership for the distribution of the assets to the beneficiaries of Sir George.

4. Before me is an application by Defendant through Denton Lawyers by way of a Notice of Motion filed on 13 July 2021 seeking dismissal of these proceedings as being frivolous and vexatious and for being an abuse of the process of Court amongst other orders in the alternative.

5. There are two other proceedings concerning the administration of the estate of Sir George and it is important for me to set them out in this decision so as to clarify the issues before me for determination:

1. OS 478 of 2018
   

These were proceedings filed on 17 July 2018 by the then Administrator of the Estate of Sir George, Sir Theophilus. The proceedings sought opinion, advice or direction of the Court pursuant to section 46 of the Trustees and Executors Act 1966 in regard to the administration of the estate of Late Sir George. Plaintiff is a Defendant in those proceedings. A hearing on those proceedings was conducted on 3 June 2019 in which Plaintiff was also heard and a decision has since been reserved on those proceedings. It has been submitted by parties that there is no indication from the Court in those proceedings of when a decision will be handed down as parties eagerly await a conclusion and it is the Defendant’s submission that the administration of the Estate of Sir George can only be concluded when a decision is given in that matter.

2. OS 55 of 2020
   

` On 21 February 2020, eight months after the hearing in OS 478 of 2018, the Plaintiff in this matter commenced OS 55 of 2020. In those proceedings the Plaintiff sought pursuant to the Wills, Probate and Administration Act, the Trustees and Executor’s Act and the National Court Rules orders seeking inventory and audited accounts of the Estate of Sir George. From submissions from counsels, there has been a challenge on the jurisdiction of the Court in those proceedings however the challenge was overruled by the Court and the proceedings are still alive and yet to be determined by the National Court.

6. The Plaintiff then on 14 December 2020 filed these proceedings by way of Writ of Summons and Statement of Claim, claiming reliefs alleging damages and breach of duties on the part of the administrators over the estate of Sir George and also for compensation for breach of those duties and for the administration of the estate of Sir George and other additional orders in regard to the estate of Sir George.

7. The application before me seeks dismissal of these proceedings on the basis that it is frivolous, vexatious and an abuse of the process of the Court and that it be dismissed and or stayed and other orders in the alternative.

8. To understand why the Plaintiff instituted proceedings OS 55 of 2020 and again these proceedings and the nature of the orders sought seeking inventory and an account of the estate of Sir George as a beneficiary and challenging the administration of the estate of Sir George, I am drawn to the Plaintiff’s submissions that ‘the Plaintiff took reasonable attempt to mitigate or reduce the rate of loss and damage consequent upon the neglect and excesses of which she complains’. Plaintiff complains that it has taken some 13 years after the death of the Late Sir George and his estate is yet to be administered and accounted for.

9. Defendant relies on the principle that Plaintiff should have brought forward every possible issue for determination in the first proceeding in OS 478 of 2018. Defendant further alleges that by coming to court in separate proceedings, the Defendants have been put to task to defend these proceedings and that should be seen as an abuse of the process of the Court.

10. Defendant relies on the case of State v Peter Painke [1976] PNGLR 210 where the Court stated that:

“Abuse of the process of the Court is an expression used to describe any use of the process or procedures of the Court for an improper purpose or in an improper way. It encompasses a wide range of situations.”

11. The Supreme Court said it clearly in Pruaitch v Manek [2019] SC1884 as submitted by the Defendant in referring to Popunawa v Owa [2017] SC1564 and Michael Wilson v Clement Kuburam [2016] SC1489 wherein the Court said that:

“The types of abuses of the process may vary from case to case but to establish an abuse of process there must be evidence showing that the process of the Court has been improperly used; or have been used for an improper purpose; or have been used in an improper way; or that such abuse of process has resulted in the right of the other party being denied, defeated or prejudiced.”

12. The Defendant also submits that multiplicity of proceedings is also an abuse of process of the Court by referring to Pokia v Yallon [2014] SC1336 wherein the Court stated that:

“such an abuse can be committed when two proceedings are conducted simultaneously regarding the same cause of action..”

13. The various abuse of process cases, therefore, involves more than one proceeding concerning the same cause of action which amounts to the multiplicity of proceedings on the same subject matter which a determination in one would render the other unnecessary and cause a defendant to defend more than one proceeding causing a strain on them on time and costs to defend multiple proceedings.

14. Defendant states that Plaintiff, in this case, should have raised the issues raised in this proceeding as to any claim for breach of duty of the administrator, and or any claim for inventory and account as in OS 55 of 2020 in OS 478 of 2018 instead the Plaintiff has come to Court in a piecemeal manner by mounting OS 55 of 2020 and this proceeding when it could have raised those claims in OS 478 of 2018.

15. The Plaintiff explains the “Anshun estoppel” enunciated in the High Court of Australia in Port of Melbourne Authority v Anshun (1980) HCA 41 and applied in PNG in the cases; Lysenko v National Airline Commission (1989) N719 & (1990) SC 386, AGC (Pacific) Ltd v Kipalan (2000) N1944; and State v Downer Construction (PNG) Ltd (2009) SC979 and states that, the Plaintiff’s claims in this proceeding and in OS 55 of 2020 are not inconsistent, the Plaintiff says that she is entitled to seek an inventory and account of the estate as a beneficiary and to claim as in this proceeding the orders sought for breach of duty of the administrator and orders to compel the administration of the estate etc.

16. The ‘anshun principle” states that a party must bring forth all matters in contention within a proceeding to ensure that such matters are not then relitigated in another proceeding. A litigant is therefore estopped from raising relevant and similar issues he/she could have raised in prior proceedings. Justice Neill (as he then was) in Eremuge v Kama [2019] (WS 951 of 2011) said:

“The rule is based on justice. A litigant can be worn down by the other party making piecemeal attempts to obtain a judgement. It is important for a litigant to be able to respond to the claim in a comprehensive way and obviously, it is saving of the Court's time to do this rather than have the matter coming back into the list, time after time.”

17. The Plaintiff relies on Tanning Research Laboratories Inc v O’Brien [1990] HCA 8 as quoted in Timbers (PNG) Limited v Kambori (2010) N4283 where she submits that upon careful consideration of the claims in OS 55 of 2020 and in these proceedings as well as her position in OS 478 of 2018, the Plaintiff’s claims are not inconsistent.

18. The Plaintiff quotes the Anshun case as stated by the High Court of Australia that:

“here are a variety of circumstances...why a party may justifiably refrain from litigating an issue in one proceeding yet wish to litigate the issue in another proceeding eg, expense, the importance of the particular issue, motives extraneous to the actual litigation, to mention but a few.”

19. The Court in Johnson v Gorewood & Co ((HL(E))[2002] 2 AC 1, the Court stated that:

“..there is a public interest in the finality of litigation and in a defendant not being vexed twice in the same matter; but that whether an action was an abuse of process as offending against that public interest should be judged broadly on the merits taking into account of all the public and private interests involved and all the facts of the case, the crucial question being whether the Plaintiff was in all the circumstances misusing or abusing the process of the Court, and that in all the circumstances, the Plaintiff’s action was not abusive.”

20. The Plaintiff states that filing a cross-claim in OS 478 of 2018 would only delay the outcome of that proceeding as, since the grant of probate over the estate of Sir George, the beneficiaries have waited for quite some time to benefit from the estate.

21. I am of the view that the Plaintiff’s claims in OS 55 of 2020 seeking inventory of the account of the estate of Sir George and claiming a breach of duties on the administrator as in this proceeding are correctly not inconsistent as submitted by Defendant however the timing of these proceedings are perhaps premature.

22. I am of the view that Plaintiff as a beneficiary to the estate of Sir George’s estate and any other beneficiary for that matter is clearly frustrated by the long-drawn-out delay in the administration of the estate since its grant on 20 March 2009. No doubt it is a considerable estate with considerable worth. I find that matters in relation to the administration of a deceased estate cannot be dealt with on a piecemeal basis when the Administrator is already in Court seeking guidance and or direction as to the administration of the estate. To my mind, an Administrator should be allowed to carry out his/her functions as appointed by law and where there is direction and or guidance that he seeks from the Court, he should be allowed to take those measures in the best interest of the estate guided by the Court. Only and until those measures are taken can the administrator be in a position to account after enquiry and taking necessary steps to administer the estate. A claim for mismanagement and or breach of duty of an administrator can clearly be defined after the fact, after he hears from the Court, in this case pending the determination of OS 478 of 2018. It is a far cry from an estate of a deceased where the administrator has done nothing at all and has sat on his hands. In the estate of Sir George, OS 478 of 2018 suggests to me that the Administrator has not left his duties idle, he has approached the Court for appropriate direction and guidance on administering the estate and therefore that is a process to my mind, should and must be allowed to be seen through to allow progress on the administration of the estate.

23. I am of the view that OS 55 of 2020 and these proceedings by Plaintiff are attempts to force the hand of the Administrator to account for the estate and throw the blame on the administration of the estate on both Sir Kostas and the late Sir Theophilus when there is a decision pending on direction sought by the Administrator on administering the estate. The Plaintiff’s rights as advanced in OS 55 and also in these proceedings are perhaps a bit premature when the Administrator is waiting on direction and guidance from the Court on OS 478.

24. The Administrator is put under the pressure of defending two proceedings relating to the estate when at the same time, he is seeking guidance/direction from the Court. The Administrator is prejudiced in this instance having to defend two proceedings when it would be proper to get guidance from the Court then act accordingly and only after that opportunity, respond to any claims for presentations of accounts, and or claims for mismanagement.

25. I, therefore, accept the submissions by Plaintiff that the claims in OS 55 of 2020 and these proceedings are not inconsistent. Plaintiff is within her right to mount these proceedings separately, the causes of actions are not the same however the abuse to my mind is that Defendant is tasked to give an account of the estate of Sir George, and to answer to allegations of mismanagement and breach of duty when he is still waiting on the Court to give direction and or guidance on the administration of the estate. This is the prejudice on the Defendant and the Plaintiff still has these options to ask for an inventory and account of the estate and demand answers as to how the estate was managed as is her right as a beneficiary, but those rights should crystalise after the administrator has heard from the Court in OS 478 of 2018 and has acted accordingly.

26. I am of the view that these proceedings are an abuse of the Court’s process and are frivolous and vexatious for the reason that the Defendant as the administrator is prejudiced in defending two proceedings when he is yet to receive guidance and direction from the Court as to the administration of the estate. Dismissing these proceedings, therefore, does not diminish Plaintiff’s right and is not pushing Plaintiff off the judgment seat. Until the Court determines OS 478 and issues appropriate directions and guidance, an account of the administration of the estate of Sir George can then be demanded if it is further delayed and or any allegations of breach of duty can be advanced but not until the Administrator is given an opportunity to act accordingly as sought in OS 478.

27. I, therefore, make the following orders:

1. These proceedings are struck out.
2. The Plaintiff will meet the reasonable costs of the Defendant on a party-party basis to be taxed if not agreed.
   

Orders accordingly.
_____________________________________________________________
O’Briens Lawyers: Lawyers for the Plaintiff
Dentons Lawyer: Lawyers for the Defendant