Makis v Nahe [2022] PGNC 467; N9997 (25 October 2022)

N9997

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

WS NO. 1655 OF 2019

BETWEEN:
JEFF MAKIS, Operations Manager, MB Building Construction
First Plaintiff

AND:
MB BUILDING CONSTRUCTION
Second Plaintiff

AND:
WESLEY NAHE, Board Chairman, Onerunka High School
First Defendant

AND:
ALEX ASA, Headmaster, Onerunka High School
Second Defendant

AND:
THOMAS JONDUO, Provincial Education Director, Eastern Highlands Province
Third Defendant

AND:
LAVERT GANINO, Acting Director, Transport & Civil Works Division, Eastern Highlands Provincial Administration
Fourth Defendant

AND:
JOHN GIMISIVE, Provincial Administrator, Eastern Highlands Provincial Administration
Fifth Defendant

AND:
EASTERN HIGHLANDS PROVINCIAL GOVERNMENT
Sixth Defendant

Goroka: Mugugia, AJ
2022: 20^th & 25^th October

PRACTICE AND PROCEDURE – Motion seeking orders to amend pleadings and addition of parties, National Court Rules, Order 8, Rule 50(1) and (3), and Order 5, Rule 8(1)(b) - Exercise of discretion – Orders in motion granted.

Cases Cited:

Papua Club Inc. v. Nusaum Holdings Ltd. (2002) N2273
Kewa v. Kombo (2004) N2688

Counsel:

K. Lafanama, for the Plaintiffs
No appearance for the Defendants

RULING

25^th October, 2022

1. MUGUGIA, AJ: The current proceedings has been in this Court since 2019, and is progressing at a slow pace. The Plaintiffs’ claim is for breach of contract. The amount claimed is K199,644.14. The nil participation by the named First and Second Defendants and their lack of response forced the Plaintiffs to file a formal application to amend their pleadings to add the current position holders namely Mark Kompane (Board Chairman of Onerunka High School) and Donoun Negagt (Head Master of Onerunka High School) as the First and Second Defendants in the proceedings.
   

2. The Office of the Public Solicitor filed the Plaintiffs’ motion on 7^th October 2022. The lawyer in carriage of the matter from that office Ms Karen Lafanama prosecuted her clients’ application on 20^th October 2022. The Court was informed at the hearing that Counsel for the Third, Fourth, Fifth and Sixth Defendants did not oppose the application. I heard the application and reserved my Ruling. This is my Ruling.

BACKGROUND

2. A Minor Contract for the Provision of Building Works to the project described as “Onerunka High School Low Set Three Bedroom Residential Staff House Construction” was entered into between the Eastern Highlands Provincial Administration and MB Construction (Contractor) on 15^th August 2016. The Contract was awarded by the Eastern Highlands Provincial Supply and Tenders Board. The project was funded by the Eastern Highlands Provincial Administration. The project cost was K199,644.14, and the project duration was twelve (12) weeks.
   
3. The First Plaintiff filed the Writ of Summons and Statement of Claim in person on 12^th December 2019. Wesley Nahe (First Defendant) was named in his capacity as the Board Chairman of the Onerunka High School (School), and Alex Asa (Second Defendant) was named in his capacity as the headmaster of the School. A chronology of the events that took place is set out in the Plaintiffs’ Statement of Claim. As pleaded, after the signing of the Contract, the Sixth Defendant advised the First Plaintiff that the monies will be given to the school, and he will pick up the money to start the project. In or around June 2017, the Third Defendant presented a cheque of K200,000.00 to Mark Kompane at the school. Mark Kompane was the Board Chairman at that material time. When the First Plaintiff enquired at the school, he was advised by the Second Defendant Alex Asa that he had to wait as the cheque had just been presented. The Plaintiff followed up after a week and was told by the Second Defendant that the cheque was lost. The Plaintiffs claim that the First, Second, Third Fourth and Fifth Defendants failed to perform their obligations as required under the terms of the contract agreement. Particulars of Breach and Particulars of Loss are pleaded in the Statement of Claim. The Plaintiffs now claim the sum of K199,644.14 from the Defendants.
   

THE PLAINTIFFS’ MOTION

5. In term one of the motion, the Plaintiffs seek an order pursuant to Order 8, Rule 50(1) and (3) of the National Court Rules that the First and Second Defendants as named in that capacity be amended to the current position holders.

6. In term two of the motion, the Plaintiffs seek an order pursuant to Order 5, Rule 8(1)(b) of the National Court Rules that Mark Kompane be added as the first defendant, and Donoun Negagt be added as the second defendant in their capacity as Onerunka High School Board Chairman and Head Master respectively.

SUPPORTING AFFIDAVITS

7. Ms. Lafanama relied on these Affidavits which she submitted contained the facts giving rise to her clients’ application, and the evidence in support of the two orders sought in the motion:

7.1. Affidavit in Support of Jeff Makis filed on 7^th October 2022;

7.2. Affidavit of Karen Lafanama filed on 7^th October 2022;

7.3. Affidavit of Delma Korul filed on 7^th October 2022; and

7.4. Affidavit of Jeff Makis filed on 17^th November 2020.

PLAINTIFFS’ SUBMISSIONS

8. The evidence in support is that the matter has been dragging on because Wesley Nahe and Alex Asa could not be located. The First Plaintiff has been searching for them since April 2022. Attempts to communicate with them were made but communication has failed. Even text messages sent to them have not been acknowledged. There were no responses.

9. Mr Makis’ evidence is corroborated by Ms. Lafanama’s evidence in her affidavit. Ms. Lafanama deposes that this matter has dragged on due to the non-responses from the named First and Second Defendants. Given that, they could not locate the named First and Second Defendants, the Plaintiffs cannot progress this matter without the necessary amendment to allow the persons serving in their capacity to deal with the issues arising. In the interest of justice, the Court should grant her clients’ application or make further orders to allow them to progress this matter to trial.

10. The evidence in support provided by the First Plaintiff is that, he confirmed on 23^rd September 2022 that Mr Mark Kompane is the current chairman and Mr Donoun Negagt is the recently appointed Principal/Head Master of the school. They are now the current position holders and should be aware of any investigations relating to the contract cheque of K199,644.14 which was paid into the school accounts on two different occasions.

11. Ms. Lafanama assisted the Court with these submissions in support of her clients’ application:

• They have had difficulties in serving the documents on the named First and Second Defendants. They are no longer occupying the positions as Board Chairman and Headmaster and it is hard to locate them. The evidence provided show the difficulties they have had in progressing the matter.
  
• The application to amend is made bona fide and is a proper amendment. There is no opposition to the application by the lawyers for the Third, Fourth, Fifth and Sixth Defendants. In the interest of justice, the Court should grant her clients’ application to amend.
  
• Mark Kompane is aware of the Plaintiffs’ claim because after the cheque was lost, he took over as the Board Chairman and did a letter to the Provincial Accountant concerning the lost cheque. This letter is annexed to the Affidavit of Jeff Makis filed on 17^th November 2020.
  
• The amendment to include Mark Kompane and Donoun Negagt is necessary for them to provide relevant documents and information on the contract. The documents on the contract will still be in the records of the school. Mark Kompane and Donoun Negagt have powers to release the documents to the Court. If Mark Kompane and Donoun Negagt are added, they will assist the Court to determine the issues.
  
• Mark Kompane is the current Board Chairman of the school. He has an administrative function. Donoun Negagt is the current headmaster. He is the institutional head. As such, they should be added as parties to the proceedings.
  
• Without the involvement of Mark Kompane and Donoun Negagt, the Plaintiffs cannot progress the matter to trial. It is necessary to amend the pleadings to progress the matter to trial.
  
• The Court has discretionary powers.
  

ISSUES FOR DETERMINATION

12. The two issues arising from the Plaintiffs’ motion are:

12.1. Whether an order should be made to amend the Writ of Summons and Statement of Claim to name the current position holders as the First and Second Defendants respectively.

12.2. Whether an order should be made for Mark Kompane to be added as the first defendant, and Donoun Negagt to be added as the second defendant in their capacities as Onerunka High School Board Chairman and Headmaster respectively.
DETERMINATION OF THE ISSUES

The Law Applicable

13. Order 8, Rule 50(1) and (3) of the National Court Rules read:

“(1) The Court may, at any stage of any proceedings, on application by any party or of its own motion, order, on terms that any document in the proceedings be amended, or that any party have leave to amend any document in the proceedings, in either case in such manner as the Court thinks fit.

(2) ...

(3) Where there has been a mistake in the name of a party, Sub-rule (1) applies to the person intended to be made a party as if he were a party.”

14. The National Court has power under Order 8, Rule 50 of the National Court Rules to grant leave to amend pleadings at any stage of the proceedings. The power to grant leave is an exercise of judicial discretion and must be exercised based on proper principles of law.

15. In Papua Club Inc. v. Nusaum Holdings Ltd. (2002) N2273, Gavara-Nanu J stated these guiding principles that the Court should consider when faced with an application for leave to amend a pleading:

“(1) Where the amendment is to enable the Court to determine the real question in controversy between the parties, or

(2) Where the amendment is to correct any defect or error in the proceedings, and

(3) That such amendment will not cause real prejudice or injustice to other party, and

(4) That the application for such amendment is not made mala fide, and

(5) That the other party can be fairly compensated with costs for such amendment.”

16. In Kewa v. Kombo (2004) N2688, Cannings J added these three considerations:

“(1) Is the party prevented by its conduct or the manner in which the proceedings have progressed from being permitted to amend its pleadings?

(2) Where do the interests of justice lie?

(3) Is the proposed amendment efficacious? That is, is it a proper amendment?”

17. Order 5, Rule 8(1)(b) of the National Court Rules states:

“Where a person who is not a party is a person whose joinder as a party is necessary to ensure that all matters in dispute in the proceedings may be effectually and completely determined and adjudicated on, the Court, on application by him or by any party or of its own motion, may, on terms, order that he be added as a party and make orders for the further conduct of the proceedings.”
18. Whether to make an order to add a party/person is a matter of discretion.

Application of the Law

19. Should I make an order to amend the Writ of Summons and Statement of Claim to name the current position holders as the First and Second Defendants respectively?

20. I find the Plaintiffs’ supporting evidence before me and the submissions put forward by Ms Lafanama convincing.

21. I adopt the guiding principles and considerations set out in paragraphs (15) and (16) above and apply them here.

22. Breach of contract is alleged against the First, Second, Third, Fourth and Fifth Defendants for their failure to perform their obligations as required under the terms of the Minor Contract entered into between the Eastern Highlands Provincial Administration and the Second Plaintiff on 15^th August 2016. The first issue that the Court will be faced with at the trial of the matter is whether the Defendants are liable for breach of contract.

23. Wesley Nahe and Alex Asa no longer occupy the positions of Board Chairman and Headmaster in the School. They have moved on but the records of the contract and the transactions that took place would most likely be at the School. I find that the amendment to the Writ of Summons and Statement of Claim to name the current position holders will enable the Court to determine the issue of liability. The Court will be better assisted by the current position holders who will provide the relevant documents and information on the contract.

24. The Plaintiffs pleaded in paragraph 15 of their Statement of Claim that the cheque in the sum of K200,000.00 was presented to Mark Kompane in or around June 2017 when he was the School’s Board Chairman. I am of the view that there has been a mistake in the naming of the First Defendant. Mark Kompane should have been named as the First Defendant instead of Wesley Nahe. I find that the proposed amendment will correct this error in the proceedings.

25. There was no opposition to the Plaintiffs’ motion by the Third, Fourth, Fifth and Sixth Defendants. I find that the amendment will not result in injustice and prejudice to the Defendants.

26. I find that the Plaintiffs’ application for such amendment is made bona fide.

27. The proceedings has been on foot since 2019. As is evident from their supporting affidavits, the Plaintiffs have taken all necessary steps to prosecute the matter in a timely manner. However, the nil participation and lack of response by the named First and Second Defendants have contributed to the delay in progressing the matter to trial. The Plaintiffs have taken this necessary step to amend the pleadings purposely to progress the matter to trial. In the interest of justice, the Plaintiffs should be permitted to amend their pleadings.

28. The interests of justice lie in granting the application to amend the Writ of Summons and Statement of Claim to name the current position holders as the First and Second Defendants respectively, for the purpose of determining the real question or questions in controversy between the parties that arise in the proceedings.

29. In the exercise of my discretion, I will grant the first order sought by the Plaintiffs in their motion.

30. Should I make an order for Mark Kompane to be added as the first defendant, and Donoun Negagt to be added as the second defendant in their capacities as Onerunka High School Board Chairman and Headmaster respectively?

31. I am convinced by the supporting evidence before me, and the submissions put forward by Ms Lafanama. I find that the prerequisites in Order 5, Rule 8(1)(b) of the National Court Rules have been satisfied by the Plaintiffs.

32. The pleadings disclose a cause of action against Mark Kompane. See paragraph 24 above. I am of the view that he will most definitely have first-hand information of the Plaintiffs’ claim.

33. Mark Kompane and Donoun Negagt are the current position holders at the School. Being the Board Chairman and the Headmaster, they will most definitely have access to the documents pertaining to the Minor Contract which are kept by the School. They are in the right position to provide to the Court the relevant documents and information on the Minor Contract and the Plaintiffs’ claim.

34. I find that their joinder as parties is necessary to ensure that all matters in dispute in the proceedings may be effectually and completely determined and adjudicated on. Their involvement is necessary. In the exercise of my discretion, I will grant the second order sought by the Plaintiffs in their motion.

CONCLUSION

35. Based on the reasons given above, and in the exercise of my discretion, I will grant the orders sought by the Plaintiffs in their Notice of Motion filed on 7^th October 2022.

FORMAL ORDERS

36. The formal orders of the Court are:

1. The Plaintiffs are granted leave to amend their Writ of Summons and Statement of Claim filed on 12^th December 2019 to add Mark Kompane in his capacity as Board Chairman of Onerunka High School as the First Defendant, and Donoun Negagt in his capacity as Head Master of Onerunka High School as the Second Defendant.

2. Costs be in the cause.

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.

Ruling and Orders accordingly.
________________________________________________________________
Karen Lafanama: Lawyer for the Plaintiff