Ruma Construction Pty Ltd v Smith [1999] PGSC 2; SC600 (25 March 1999)

Unreported Supreme Court Decisions

SC600

PAPUA NEW GUINEA

[SUPREME COURT OF JUSTICE]

SCA NO. 86 OF 1997
BETWEEN: RUMA CONSTRUCTION PTY LIMITED
APPELLANT
AND: CHRISTOPHER SMITH
RESPONDENT

Waigani

Kapi DCJ Sakora Injia JJ
22 March 1999
25 March 1999

SUPREME COURT ACT, s 14 (3) (b) – whether summary judgment is an interlocutory judgment.

Counsel

W. Frizzell for the appellant

P. Payne for the respondent

25 March 1999

KAPI DCJ SAKORA INJIA JJ: The National Court entered summary judgment in this matter (WS 481 of 1997) on 10^th November 1997 under the provisions of the National Court Rules (Rules). An application for leave to appeal against this decision together with a separate Notice of Appeal was filed on 19^th December 1997. The Application for Leave has come before us for determination.

The relevant facts which gives rise to the application for leave may be summarised as follows. By a writ of summons (WS No. 481 of 1997) filed on 27^th May 1997, Mr Christopher M Smith (respondent) claims specific performance of a contract and/or damages against Ruma Construction Pty Ltd (appellant) over a sale of property, Part Lot 3, Section 27, Granville, in the National Capital District. On the 30^th May 1997, the respondent obtained orders to restrain the appellant from transferring, leasing or otherwise dealing with the said property pending the determination of the substantive cause of action.

On 30^th July 1997, an order for specific performance was made in favour of the respondent. However, these orders were not effective because the property which was the subject of the orders was transferred and registered in the name of SJS Enterprise Pty Ltd on 3^rd July 1997.

On 10^th November 1997, the respondent set aside the specific performance orders and in substitute obtained summary judgment against the appellant with damages to be assessed. There is no question that the appellant was served with the motion for summary judgment. However, the order was made in absence of the appellant and its lawyers.

The appellant seeks to review this decision by this application for leave to appeal. No appeal lies to the Supreme Court from an interlocutory judgment except with the leave of the Supreme Court (s 14 (3) (b) of Supreme Court Act (the Act)).

Counsel for the appellant submits that the order in question is not an interlocutory judgment but a final order and therefore leave is not required. The application for leave to appeal was filed only as a precaution. In the alternative, he submits that if leave is required, the Court should grant leave to appeal.

Counsel for the respondent on the other hand submits that the order is in the nature of an interlocutory judgment because the order was made in absence of the appellant and its lawyers may set aside the judgment under O 12 r 3 (a) of the Rules. He submits that the provision for setting aside the judgment renders a summary judgment made in absence of a party an interlocutory judgment. Therefore, he submits that it is necessary for the appellant to obtain leave of the Court to appeal. In this respect, he submits that the appellant has failed to satisfy the Court why it should grant leave.

The issue before us is; whether the summary judgment entered is an interlocutory judgment. The cases have established in determining this issue that there are two tests which may be applied. The tests are first that the court must look at the nature of the application to the court and not the order the court eventually made. Second the court must look at whether the judgment or order made finally disposes of the right of the disputing parties (Shelly v PNG Aviation Services [1979] PNGLR 119; Provincial Government of North Solomons v Pacific architecture [1992] PNGLR 145; Rimbink Pato v The Hon. Sir Julis Chan and the Hon. Chris Haiveta (Unreported judgment of the Supreme Court dated 16^th July 1997, SC527; LA Jarden Collector Agency Pty Ltd v Richard Hill & Associates and Masket Ingalio and Public Curator of PNG (Unreported judgment of the Supreme Court dated 31^st August 1998, SC597).

We apply these tests in determining this application. Counsel for the respondent relies very heavily on the consideration that a summary judgment which is obtained in absence of a party is by nature interlocutory because such a judgment may be set aside upon application to the National Court under the Rules. Counsel for the appellant submits that the summary judgment obtained in the present case goes to issues in dispute between the parties in the cause of action and the judgment finally disposes of those rights and therefore the judgment is final. Both counsel failed to refer to any authority which deals with this particular issue of whether a summary judgment is an interlocutory judgment.

In LA Jarden Collector Agency Pty Ltd v Richard Hill & Associates and Masket Ingalio and Public Curator of PNG (supra), the National Court was concerned with an adjudication under the provisions of Insolvency Act. Under s 141 of that Act, the National Court may annul an insolvency order. Such an order may be reviewed, varied or rescinded under ss 97 or 150 of the Insolvency Act. Los J. accepted the argument that in view of the power of the National Court to vary such an order, he concluded that the order in question is an interlocutory judgment. The majority on the other hand reached a contrary view. They held:

“In this case the appellants were claiming against the estate of the insolvent after properly filing proof of debts and were entitled to be properly considered in the insolvency. The proceedings for annulment were intended to terminate the insolvency and discharge the first respondent from further obligation under the insolvency order. The effect of the annulment order is that the first respondent is discharged from insolvency and the appellants are deprived of opportunity to obtain satisfaction of their debts under the insolvency by full utilisation of the provisions of the Insolvency Act. The appellants will however need to re-institute proceedings afresh if they wished to recover their debts. It is thus obvious that the decision, albeit interlocutory, is a final decision as there is no substantive issue afoot that remains to be tried, thus leave is not required to appeal.”

We prefer the view expressed by the majority. We agree with the majority opinion that the fact that appellants in the above-named case had other avenues open to them under the Insolvency Act to challenge the order is a distinct and separate issue from whether the order is interlocutory or final.

In the present case, the judgment finally disposes of the issues before the Court and there are no further issues left to be determined. Whether or not the law makes provision for reviewing that decision and whether or not that decision may be discharged or varied does not change the nature of the orders that they are final. We find that the summary judgment in the present case is not an interlocutory judgment and therefore leave is not necessary.

There is a Notice of Appeal which is on foot and should be set down for determination on the merits.

Lawyers for the Appellant: Warner Shand

Lawyers for the Respondent: Blake Dawson Waldron