Kiuk v Komunga [2022] PGNC 75; N9511 (28 March 2022)

N9511

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

MP NO. 10,11,12,13 AND 15 OF 2020 (IECMS) (CC4)

BETWEEN:

NICKSON KIUK (FORMERLY TRADING AS NIKIUMA LAWYERS)

Applicant

AND:

JOHN KOMUNGA, GLEN KUNDI & ORS

Respondents

AND:

JIM TAPAKO & JT INVESTMENTS LTD

Respondents

Waigani: Tamade AJ

2021: 9^th, 10^th December

2022: 28^th March

LAWYERS ACT 1986 – action to recover a lawyer’s professional legal costs – Section 62 – lawyer bill of costs delivered in accordance with the act.

FRAUDS & LIMITATIONS ACT 1988 – limitations of actions in contract and tort – cause of action accrued more than six (6) years ago - actions shall not be brought after expiration of six (6) years.

CAUSE OF ACTION – lawyer’s right and cause of action in respect of outstanding legal fees arises on completion of the last legal work.

Cases Cited:

Papua New Guinean Cases

The following cases are cited in this judgment:

Oil Search Limited v Mineral Resources Development Corporation Ltd [2010] PGSC 12; SC1022

Woodward v Woodward [1987] PNGLR 92

Mountain Oil Ltd v Tokaju Engineering Services Ltd [2017] PGNC 430; N8546

Kewa v Madang Provincial Government [2014] PGNC 109; N5650

Patterson Lowa & Ors v Wapula Akipe & Ors [1992] PNGLR 399

Overseas Cases

Corburn v Colledge [1897] 1 QBD 702

Cockburn v Shehadie [2013] NSWSC 758

Legislation:

Lawyer’s Act 1986

Frauds and Limitations Act 1988

Counsel:

Mr Nikson Kiuk, Applicant In Person

Mr Joshua Yak Yalgga, for the Respondents John Komunga, Glen Kundin and Ors and Baning Ltd in MP 10, 11 and 15 of 2020

Mr Laken Lepatu Aigilo, for the Respondents Mr Jim Tapako and JT Investments Limited in MP 12 and 13 of 2020

28^th March, 2022

1. TAMADE AJ: The Applicant Mr Nikson Kiuk is a lawyer formerly operating in the firm of Niukiuma Lawyers. The Applicant has filed all these proceedings from MP 10, 11, 12, 13, and 15 of 2020 against his former clients in pursuance of his Solicitor Client Bill of Costs. MP 14 of 2020 was withdrawn by the Applicant prior to the matter coming before me for hearing on the Respondent’s application to dismiss these matters for being statute-barred.

2. Proceedings MP 10, 11, and 15 of 2020 are against the Respondent Mr Glen Kundin and his company Baning Trading Limited in matters represented by the Applicant Mr Nickson Kiuk.

3. MP 12 and 13 of 2020 are by the Applicant against his former clients Jim Tapako and JT Investments Limited who are represented by Laken Lepatu Aigilo of Gibson Bon Lawyers.

When did the causes of action start?

4. In MP 10 of 2020 - Mr John Komunga, one of the Respondents has stated in affidavit material that they had instructed the Applicant to represent them in proceedings described as WS 1393 of 2007- John Komunga & Ors v Malcolm Smith Kela & Ors. Those proceedings were dismissed in 2008 for failing to give section 5 Notice pursuant to the Claims By and Against The State Act. Mr Komunga stated in his affidavit that they did pay some money to the Applicant for his fees and asserts that the last work done on the matter as per the Solicitor Client bill from the Applicant was sometime in 2012. The Bill of Costs was filed on 27 July 2020.

5. In MP 11 of 2020 as against Baning Trading Limited, Mr Glen Kundin who is a shareholder and director of Baning Trading Limited stated in his affidavit that work was done by the Applicant to represent his company in Court and there were bills paid however he is unable to verify how much was paid. Mr Kundin states that he notes from the Solicitor Client bill pursued by the Applicant that the last work done on the matter was on or about 20 February 2013 and the Bill of Costs was issued on 1 June 2020. Mr Kundin states that the work in MP 11 of 2020 was in relation to work in SCR 67 of 2008 which was concluded by a Supreme Court judgment in 2009. The Respondent was served the Solicitor Client Bill of Costs on 1 June 2020 by registered mail and taxation of the bill proceeded ex parte in which the Respondent now contests the Bill.

6. MP 12 of 2020 - concerns work done in WS 1075 of 2009 - Jim Tapako & JT Investments Ltd v George Ipi & PNG Toner & Ink Supplies Ltd. Proceedings WS 1075 of 2009 were dismissed on 30 September 2011 and an appeal in SCA 135 of 2011 was lodged on that matter which was dismissed by the Supreme Court for want of prosecution on 27 February 2013. The Solicitor Client Bill was served on the Respondent on 1 June 2020.

7. MP 13 of 2020 is in relation to SCA 135 of 2011 which was dismissed by the Supreme Court on 27 February 2013. The Bill of costs shows personal attendances on the matter between 2011 to 2015 however there is no specific date in 2015 as to what specific work was done. I am of the view that the last work completed on the matter was in 2013. A Solicitor Client Bill of Costs was served by registered mail on 1 June 2020 to the Respondent and taxation of the Bill of Costs happened ex parte on 26 August 2020.

8. In MP 15 of 2020 is in relation to work done in WS 1858 of 2006 - Glen Kundin & Baning Trading Ltd v State & Ors. The Respondents state that WS 1858 of 2006 was dismissed on 16 July 2014 and therefore the last work done on that matter as per the Solicitor Client Bill of costs was on 16 July 2014 wherein the Applicant attended Court for Summary Determination of the matter. The Solicitor Client Bill was served by registered mail to the Respondents on 1 June 2020 and the taxation proceeded ex parte on 26 August 2020.

9. I find that there existed a relationship between the Applicant and the Respondents not only as his former clients but on a personal level wherein there was an acknowledgement of the Applicant doing the work and the Respondents paying of fees and or assistance in one form or another and accepted by the Applicant. Nevertheless, he had chosen to wait clearly after 6 years to compile Solicitor Client Bills of Costs on various matters representing the Respondents and pursuing it through taxation.

10. The Respondents state that they were not aware of the date for taxation as they were served through registered mail and only became aware after taxation of those bills which are in quite substantial sums. There are several objections raised as to the contents of those bills however the question tasked before this Court is whether the claims by the Applicant for his Solicitor Client Bill of Costs is time-barred pursuant to the Statute of Frauds & Limitations Act.

Are proceedings MP 10, 11, 12, 13 and 15 of 2020 time-barred?

11. It is the Applicant’s contention that the proceedings are not time-barred pursuant to section 62 of the Lawyers Act that the time for the cause of action accrues a month after a Solicitor Client Bill of Costs in taxable form is given to the client.

Section 62 of the Lawyer’s Act states that:

62. ACTION TO RECOVER COSTS.

(1) A lawyer shall not bring proceedings to recover costs due to him until
the end of a period of one month after a bill of the costs has been
delivered in accordance with this Act.

(2) A bill shall contain the particulars required by the Rules of Court.

12. Section 63 and 64 of the Lawyers Act give power to the Registrar of the National Court to give orders that the bill be taxed and that the taxation be by the Taxing Officer.

13. The Respondent however submit that all these Solicitor Client Bill of Costs are pursued out of time outside the time limit as per section 16 of the Statute of Frauds & Limitations Act. Section 16(1) of the Frauds & Limitations Act 1988 states that:

16. LIMITATION OF ACTIONS IN CONTRACT, TORT, ETC.

(1) Subject to Sections 17 and 18, an action–

(a) that is founded on simple contract or on tort; or
(b) to enforce a recognisance; or
(c) to enforce an award, where the submission is not by an instrument under seal; or
(d) to recover any sum recoverable by virtue of any enactment, other than a penalty or forfeiture or sum by way of penalty or forfeiture,

shall not be brought after the expiration of six years commencing on the date on which the cause of action accrued.

14. The Respondents, therefore, argue that these Solicitor Client Bill of Costs are contracts for payment due for services rendered arising out of lawyer client relationships and therefore the cause of action would accrue from when the last work was completed on the matter.

15. Mr Kiuk implores me to find that the cause of action would accrue after one month from the date the Bill of Costs was delivered to the client under section 62 of the Lawyers Act and in this proposition, the matters would not be statute-barred whilst the Respondents submitted that the notice under section 62 of the Lawyers Act is a condition precedent only to a claim for a solicitor’s fees but the notice and the action must be brought within 6 years from the last date of when work was completed on the matter.

16. In the case of Oil Search Limited v Mineral Resources Development Corporation Ltd [2010] PGSC 12; SC1022 (30 April 2010), the Supreme Court said that:

(1) A proper determination of whether an action involving alleged breach
of contractual obligations is time-barred entails a finding on three
matters:

(a) identification of the cause of action;

(b) identification of the date on which the cause of action accrued;

(c) categorisation of the cause of action according to whether it is "founded on a simple contract" or "an action upon a speciality".

17. Mr Aigilo relies on the cases of Woodward v Woodward [1987] PNGLR 92, Mountain Oil Ltd v Tokaju Engineering Services Ltd [2017] PGNC 430; N8546 (28 August 2017) and Kewa v Madang Provincial Government [2014] PGNC 109; N5650 (27 June 2014) on breach of oral contracts or agreements, interpretations of such oral agreements to rely on the proposition that the rendering of professional legal service by the Applicant to the Respondents is one of an oral contract in the absence of any written agreement and to my mind that would govern their relationship as to the rates of billing etc.

18. Mr Aigilo submitted that the cause of action is one of simple contract, the lawyer offers and renders his profession legal services, and the client accepts the offer and pays for the work done. I accept this proposition as a cause of action on simple contract. In all these matters, there was no Lawyer Client Agreement adduced, it was a common understanding that Mr Kiuk would represent the Respondents in their legal cases, and they would pay his bills as and when he asked or upon agreement. It is not a case where no fees were paid altogether, the Respondents say they have assisted Mr Kiuk and have made certain payments to sustain their relationship so as he continues to do the work. There was some understanding that bills will not be rendered however they were surprised to receive the Solicitor Client bills more than 6 years and they can not remember due to the passage of time to critique the bill and or respond to the details of the work done. They also submit that they are prejudiced from the number of years to go through their records and show what was paid to Mr Kiuk during the course of his representation as their lawyer.

19. As to the question of cause of action, Mr Yalgga submits the case of Patterson Lowa & Ors v Wapula Akipe & Ors [1992] PNGLR 399 wherein the Court provided a definition for the term “cause of action”. The Court stated that:

The phrase “cause of action” has been used in many pieces of legislation and has been the subject of judicial consideration in other jurisdictions. In Read v Brown [1888] UKLawRpKQB 186; (1888) 22 QBD 128, the Court of Appeal considered the meaning of the phrase “cause of action”. Lord Esher MR, with whom Fry LJ and Lopes LJ agreed, at p 131 said:

“It has been defined in Cooke v Gill to be this: every fact which it would be necessary for the plaintiff to prove, if traversed, in order to support his right to the judgment of the court. It does not comprise every piece of evidence which is necessary to prove each fact, but every fact which is necessary to be proved. It has been suggested today in argument that this definition is too broad, but I cannot assent to this, and I think that the definition is right.”

The phrase “cause of action” has two components. First, there must be a right which is given by a law, such as, entitlement to reasonable damages for breach of human rights under s 58 of the Constitution. This is what is referred to as the “form of action”. Secondly, the pleadings must disclose all the necessary facts which give rise to the form of action.

20. Perhaps the more relevant and applicable case is the case submitted by Mr Yalgga in the English authority of Corburn v Colledge [1897] 1 QBD 702 where the facts are quite similar to this current case. Counsels have not submitted any PNG case authority on the current point on whether a Solicitor Client Bill of costs rendered pursuant to section 62 of the Lawyers Act is time barred however the Corburn case gives a very good discussion by the Appeal Court on the points of cause of action as in regard to a solicitor client bill of costs and time limitation to bring such an action for recovery of legal bills.

21. In the Corburn case, the Plaintiff rendered services to the Defendant as his solicitor and the work was completed on 30 May 1889. The Defendant then went overseas on 7 June and on June 12 his solicitor sent his bill of costs to the Defendant which reached the Defendant in Australia in 1891. The proceedings were instituted in 1896 after the Defendant returned to the jurisdiction. The Court of first instance found that the claim was statute barred and therefore dismissed the matter as against the Defendant. The Court of Appeal upheld the decision of the lower Court and found that:

In the case of a solicitor’s costs the cause of action arises when the work is completed, and therefore the Statute of Limitations begins to run from that time, and not from the expiration of a month from the delivery of the bill of costs.

22. I reprint this passage from the Appeals Court at pages 705 and 706 as follows:

The action is brought by the plaintiff in respect of work done by him as a solicitor. In the case of a person who is not a solicitor, and who does work for another person at his request on the terms that he is to be paid for it, unless there is some special term of the agreement to the contrary, his right to payment arises as soon as the work is done; and thereupon he can at once bring his action.

Lord Esher M.R. with regard to actions by solicitors for their costs, a solicitor stood in the same position as any other person who has done work for another at his request and could sue as soon as the work which he was retained to do was finished, without having delivered any signed bill of costs or waiting for any time after the delivery of such a bill. Then to what extent does the statute alter the right of the solicitor in such a case, and does the alteration made by it affect or alter the cause of action? It takes away, no doubt, the right of the solicitor to bring an action directly the work is done, but it does not take away his right to payment for it, which is the cause of action. The Statute of Limitations itself does not affect the right to payment, but only affects the procedure for enforcing it in the event of dispute or refusal to pay. Similarly, I think s. 37 of the Solicitors Act, 1843, deals, not with the right of the solicitor, but with the procedure to enforce that right. It does not provide that no solicitor shall have any cause of action in respect of his costs or any right to be paid till the expiration of a month from his delivering a signed bill of costs, but merely that he shall not commence or maintain any action for the recovery of fees, charges, or disbursements until then. It assumes that he has a right to be paid the fees, charges, and disbursements, but provides that he shall not bring an action to enforce that right until certain preliminary requirements have been satisfied. If the solicitor has any other mode of enforcing his right than by action, the section does not seem to interfere with it. For instance, if he has money of the client in his hands not entrusted to him for any specific purpose, there is nothing in the section to prevent his retaining the amount due to him out of that money. If that be the true construction of the section, it does not touch the cause of action, but only the remedy for enforcing it. The definition of “cause of action” which I gave in Bead v. Brown (1) has been cited. I there said that it is “every fact which it would be necessary for the plaintiff to prove, if traversed, in order to support his right to the judgment of the Court.”

23. The Court of Appeal, therefore, considered similar provisions to section 62 of the Lawyers Act and section 16 of the Frauds and Limitations Act as to time limitations. I adopt their view that section 62 of the Lawyer’s Act is only a condition precedent prior to instituting proceedings for the recovery of the Solicitor Client bill and goes as far as the process entails but it does not form the starting point for the cause of action, the cause of action occurs after completion of the work. The notice as per section 62 of the Lawyers Act and the recovery process itself are subject to the Frauds and Limitations Act and should be so instituted within 6 years from when work by the solicitor was completed.

24. I agree and adopt the view of Lopes L.J on page 709 of the judgment which stated that:

Sect. 37 of the Solicitors Act, 1843, appears to me to assume that there is a cause of action, and merely to postpone the bringing of an action upon it until the period of one month from the delivery of the bill. There is nothing in the section, so far as I can see, inconsistent with the view that the cause of action arises when the work is completed. It was urged that, if this construction were adopted, a solicitor would have a shorter time during which he may abstain from bringing his action for work done than the rest of Her Majesty’s subjects. That may be so; but on the other hand, if the plaintiff’s contention is correct, the solicitor may abstain from delivering his bill for twenty years, and then at the end of that time he may deliver it and sue after the expiration of a month from its delivery. It seems to me that that would be a very anomalous and inconvenient result.

25. It is absurd to my mind to put forth the proposition that the cause of action arose from one month after a bill of costs has been delivered pursuant to section 62 of the Lawyers Act as a lawyer can sue outside the 6 years of when work is completed making it difficult for his clients to keep up with the trail of documentation and records to challenge the bill or the work done. Therein lies the prejudice.

26. The Australian case of Cockburn v Shehadie [2013] NSWSC 758, Button J also ruled that in terms of legal fees from a Barrister to a solicitor, the cause of action occurred at the completion of the work last done. The Court’s in Australia have adopted the Corburn v College case for when a cause of action arises in terms of a Solicitor’s bills as to when the last work done and that it falls within the ambit of the time limitations similar to section 16 of the Frauds & Limitations Act.

27. I, therefore, find that all proceedings from MP 10, 11, 12, 13 and 15 of 2020 by Mr Nickson Kiuk are time-barred pursuant to section 16 (1) of the Frauds & Limitations Act and are dismissed in their entirety.

28. Mr Aigilo raised an issue that Mr Kiuk should not be considered a lawyer as he is suspended and as he does not hold a current practising certificate, he can not pursue his bills from his clients. I am of the view that the pursuance of Mr Kiuk’s bills are from the time he was practising as a lawyer and therefore he can pursue those bills however as I have outlined above in my decision, Mr Kiuk has sat on his bills for too long and have just had a change of heart to pursue his clients, but his efforts are outside the 6 year time limitation pursuant to the Frauds & Limitations Act. Mr Kiuk’s claims are therefore time-barred.

29. I, therefore, make the following orders:

1. MP 10, 11, 12, 13 and 15 of 2020 are all dismissed for being time barred.
2. Plaintiff shall meet the Defendants costs on a party/party basis in all these proceedings.
   

Orders accordingly.
______________________________________________________________
Mr Nickson Kiuk: Plaintiff In person
Raymond Obora Lawyers: Lawyers for John Komunga, Glen Kundin and Ors and Baning Ltd
Gibson Bon Lawyers: Lawyers for Mr Jim Tapako and JT Investments Limited