Oa v Brian Bell &amp Co Ltd [2022] PGNC 29; N9467 (4 March 2022)

N9467

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

WS NO. 507 OF 2019

BETWEEN:
GEORGINA OA
Plaintiff

AND:
BRIAN BELL & CO. LIMITED
Defendant

Goroka: Mugugia, AJ
2022: 1^st, 4^th March

PRACTICE AND PROCEDURE – Plaintiff’s application for default judgment – Defendant’s failure to give notice of intention to defend and failure to file defence - National Court Rules, Order 12, Rule 25(a) and (b), Rule 28 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.
Cases Cited:

Bank South Pacific Ltd. v Tingke (2012) N4901
Giru v. Muta (2005) N2877

Counsels:

K. Lafanama, for the Plaintiff
No appearance for the Defendant

RULING

4^th March, 2022
1. MUGUGIA, AJ: The Plaintiff is an aggrieved mother who has come to this Court seeking redress for what she claims is a case of unlawful termination by the Defendant company. Documentation filed by the Plaintiff’s lawyers show that the writ of summons was served on the Defendant on 25 July 2019. The Plaintiff alleges that no notice of intention to defend and defence were filed by the Defendant. She has now come before this Court with an application for default judgment against the Defendant made pursuant to a notice of motion filed on 10 February 2022. The Plaintiff seeks an order pursuant to Order 12, Rule 25(a) and (b), Rule 28 and Rule 32(1) of the National Court Rules for judgment to be entered in her favour with damages to be assessed.

2. The Plaintiff alleges breaches of the Employment Act by the Defendant. She claims that the unlawful termination of her employment by the Defendant on 8 December 2015 has caused her hardship and unnecessary emotional stress. The Office of the Public Solicitor filed her writ of summons on 3 May 2019. She seeks general damages for unlawful termination and suffering, and special damages.

3. Counsel for the Plaintiff Ms Karen Lafanama from the Office of the Public Solicitor appeared before me on the hearing date, that is, 1 March 2022, to make her client’s application. There was no appearance for the Defendant. This prompted me to enquire with Counsel whether the application before the Court was served on the Defendant, and if the Defendant was aware of the hearing date. Ms Lafanama referred the Court to the Affidavit of Service of Kembert Muro filed on 24 February 2022, which confirmed that on 18 February 2022, the Defendant was served with the Plaintiff’s notice of motion and the supporting documents, including a letter advising the Defendant of the hearing date (1 March 2022). I was satisfied that the documents were served on the Defendant in good time, and the Defendant was aware of the hearing date. I allowed Ms Lafanama to make her client’s application.

ISSUE
4. The issue for determination is whether default judgment should be entered against the Defendant?

PLAINTIFF’S EVIDENCE

5. In making her client’s application, Ms Lafanama relied on the following affidavits:

i) Affidavit in Support of Georgina Oa filed on 10 February 2022;

ii) Affidavit of Search of Karen Lafanama filed on 10 February 2022.

3. Affidavit of Service of Vibbie Move filed on 10 February 2022; and
   

iv) Affidavit of Service of Kembert Muro filed on 24 February 2022.

PLAINTIFF’S SUBMISSIONS

6. The documentations filed in Court show that service of the writ of summons and the documents in this legal proceedings was effected on one Nancy Tamarua who is a Human Resources Officer employed by the Defendant. Since the Defendant is a company, I enquired with Counsel at the outset if the service of the writ of summons on the Defendant was proper service and in accordance with Section 431 of the Companies Act (Service of documents on companies in legal proceedings). Ms Lafanama submitted that service was effected in accordance with Section 431(1)(b) and (c) of the Companies Act. Subsections (1)(b) and (c) state that any documents including a writ may be served on a company by delivery to an employee of the company at the company’s head office or principal place of business or by leaving it at the company’s registered office or address for service.
7. Ms Lafanama relied on her written submissions dated 28 February 2022, which was handed up to Court at the hearing. The Plaintiff’s submissions were as follows:

• The Plaintiff was unlawfully terminated on 8 December 2015. She had been in the employ of the Defendant under a written contract of service dated 3 July 2002. The grounds of termination the Plaintiff claims to be unlawful are that she was denied a fair hearing, she was entitled to four weeks’ notice which was not afforded to her, and she did not commit a minor or serious offence warranting her termination.
  
• The applicable laws are Order 12, Rule 25(a) and (b), Rule 28 and Rule 32(1) of the National Court Rules.
  
• The case law relied on is the case of Bank South Pacific Ltd. v. Robert Tingke [2012] PGNC 250. Kandakasi J (as he then was) sets out two legs of formalities in this case for default judgment to be entered. The first leg is the formal and technical part. The second leg is whether or not to enter default judgment falls within the discretion of the Court, and whether that discretion should be exercised in favour of a plaintiff/applicant.
  
• In applying the first leg of the principle to the facts of this case, the writ of summons with a statement of claim was duly served on the Defendant on 25 July 2019, and the Defendant failed to file its notice of intention to defend by 5 September 2019, and its defence by 25 September 2019. The time limit has expired without these documents being filed.
  
• A search of the file was carried out on 4 February 2022 confirming the Defendant’s failure to file the required documents by 25 September 2019. There was no forewarning to the Defendant of the Plaintiff’s intention to apply for default judgment while the time limited for filing was still running. Given it has been over two years, and the delay is significant on the part of the Plaintiff in filing a default judgment application, there is a clear cause of action for unlawful termination that should be considered by this Court.
  
• In considering the second leg of the principle, there has been no answer in response to the application filed and served on the Defendant on 18 February 2022. The Defendant does not appear to have a defence on merit, which, had it answered to the claim, would have assisted the Court. Ample time was given to the Defendant to answer to this application, providing for the Court, reasons why this application should not be entered.
  
• Although the Plaintiff failed to diligently prosecute this case, by forewarning the Defendant prior to the default, the Plaintiff has a clear cause of action pursuant to the Employment Act which has been particularized under her statement of claim.
  

8. When asked by the Court whether the entry of judgment will prejudice the Defendant, Ms Lafanama submitted that the Defendant has been given ample notice, and the entry of judgment will not prejudice the Defendant.

9. The Plaintiff is seeking judgment to be entered in her favour, and for damages to be assessed by the Court.

10. On the delay in bringing her client’s application, Ms Lafanama submitted that given the circumstances of this case, Section 155(4) of the Constitution should apply here since her client has a proper cause of action.

CONSIDERATION

11. The jurisdictional basis stated in the Plaintiff’s motion is Order 12, Rule 25(a) and (b), Rule 28 and Rule 32(1) of the National Court Rules.

12. Order 12, Rule 25(a) and (b) 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;”

13. Order 12, Rule 28 reads:

“28. Unliquidated damages.

Where the plaintiff's claim for relief against a defendant in default is for unliquidated damages only, the plaintiff may enter judgement against that defendant for damages to be assessed and for costs.

14. Order 12, Rule 32(1) 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.”

15. In Bank South Pacific Ltd v Tingke (2012) N4901, Kandakasi J (as he then was) stated at paragraph 6 of his decision, and I quote:

“Whether default judgment should be entered is dependent on the following factors of whether or not:

(a) the writ of summons with a statement of claim endorsed thereto has been duly served on the defendant; and

(b) the time period for filing of the defendant's defence has expired; and

(c) the defendant has not filed and served his or her defence; and

(d) a search of the court file has been carried out at the expiry of the deadline for the filing of the defence which has revealed no defence being filed; and

(e) the plaintiff has forewarned the defendant of the plaintiff's intention to apply for default judgment where a notice of intention to defend has been filed; and

(f) the defendant has not filed and served his or her defence.”

16. The case of Giru v. Muta (2005) N2877 sets out six pre-conditions that should be considered in an application for default judgment. 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.

17. In this case, Cannings J held that if all 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.

18. I adopt the statements made by the learned judges in the two cases referred to above, and the principles enunciated in the cases, and apply them in this particular case.
19. When I asked Ms Lafanama to make her submissions on the six pre-conditions, she submitted as follows:

1. Proper form: Her client’s notice of motion is in proper form. The jurisdictional basis is correct. Her client is seeking orders for general damages and special damages.

2. Service of notice of motion and affidavits: Her client’s notice of motion and affidavits were served. The Affidavit of Service of Kembert Muro filed on 24 February 2022 confirms service.

3. Default: The Plaintiff’s evidence in support confirms that the Defendant was required to file its notice of intention to defend by 5 September 2019, and defence by 25 September 2019. The Defendant defaulted in filing both the notice of intention to defend and defence. (Referred to paragraphs 6, 7 and 8 of Georgina Oa’s Affidavit in Support).

4. Warning: No warning was given to the Defendant since no notice of intention to defend and defence were filed.

The Defendant is aware of this case and the application. That would be a warning to it that there is a case on foot. The documents and notice of hearing to the Defendant would amount to warning.

5. Proof of service of writ: The Affidavit of Service of Vibbie Move filed on 10 February 2022 (Court document number 6) confirms service of the writ.

6. Proof of default: Georgina Oa’s Affidavit in Support shows proof of default by the Defendant.

20. In the present case, I find that:

1). The Plaintiff’s motion is supported by the Affidavit in Support of Georgina Oa filed on 10 February 2022. The Defendant is in default because of non-compliance with Order 12 Rule 25(a) and (b) of the National Court Rules. The correct jurisdictional basis was cited in the motion. This is a claim for unliquidated damages. Order 12, Rule 28 of the National Court Rules provides for unliquidated damages. The motion for default judgment is in the proper form.

2). Both the motion and affidavit in support were served on the Defendant on 18 February 2022. Kembert Muro’s Affidavit of Service filed on 24 February 2022 confirms the service of the motion and the affidavit in support.

3). A search of the court file has been carried out by the Plaintiff after the expiry of the deadline for the filing of the notice of intention to defend and defence which has revealed no notice of intention to defend and defence being filed by the Defendant. The Plaintiff filed the Affidavit of Search of Karen Lafanama on 10 February 2022 to confirm that the Court file search was done.

4). The Defendant is clearly in default because no notice of intention to defend and defence were filed.

5). The Plaintiff’s Affidavit of Service of Kembert Muro filed on 24 February 2022 shows that a letter dated 17 February 2022 from the Office of the Public Solicitor was served on the Defendant on 18 February 2022. Annexure “A1” is a copy of the letter.

6). The Plaintiff’s writ of summons was duly served on the Defendants on 25 July 2019. The Affidavit of Service of Vibbie Move filed on 10 February 2022 confirms service of the writ. The Plaintiff has effected service on the Defendant in accordance with the methods of service specified in Section 431(1) of the Companies Act. Order 12, Rule 34(a) of the National Court Rules has been complied with.

7). The time periods for filing of the Defendant’s notice of intention to defend and defence have expired, and the Defendant did not file a notice of intention to defend and defence within the required time. The Plaintiff Georgina Oa confirmed in her affidavit in support filed on 10 February 2022 that the Defendant was required to file its notice of intention to defend by 5 September 2019, and defence by 25 September 2019. The Defendant defaulted in filing both the notice of intention to defend and defence. (Paragraphs 6, 7 and 8 of Georgina Oa’s Affidavit in Support).

CONCLUSION

21. This is a case where the Defendant is in default because it was required to file a notice of intention to defend and defence, and the time for it to file these documents had expired but it had not filed these documents. The basis on which the application was made is on account of the Defendant’s default under Order 12, Rule 25(a) and (b) of the National Court Rules. The Defendant has clearly defaulted. Entry of default judgment is a matter for the discretion of the court.

22. I am convinced that the Plaintiff has made out a case for default judgment to be entered against the Defendant for failure to give a Notice of Intention to Defend, and failure to file a Defence. I exercise my discretion in this case and enter default judgment against the Defendant.

FORMAL ORDERS:

23. I make the following orders:

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

2. Costs is awarded against 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.
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Office of the Public Solicitor: Lawyers for the Plaintiff