Leach v Commissioner General of Internal Revenue Commission [2000] PGSC 4; SC631 (1 May 2000)

Unreported Supreme Court Decisions

SC631

PAPUA NEW GUINEA

[SUPREME COURT OF JUSTICE]

SCA 77 OF 1999
BETWEEN: JULIAN PAUL LEACH
(APPELLANT)
AND: COMMISSIONER GENERAL OF INTERNAL REVENUE COMMISSION
(FIRST RESPONDENT)
AND: LAZARUS SAPOLI
(SECOND RESPONDENT)

Waigani

Injia Sawong Kirriwom JJ
24 February 2000
1 May 2000

DAMAGES for wrongful seizure – Conversion – Assessment – Findings of facts – inferences –

COURT OF APPEAL – Duty of Court of Appeal – Findings of facts – Inferences – Properly made from findings of facts -

Cases Cited

Kerr v Motor Vehicles Insurance (PNG) Trust [1979] PNGLR 251

Karo Gamoga v The State [1981] PNGLR 443

Rimbink Pato v Umbu Pupu [1986] PNGLR 310

Counsel

W. NEILL, for the Appellant

P. BRE, for the Respondents

1 May 2000

INJIA SAWONG KIRRIWOM JJ: The National Court awarded Appellant, inter alia, the sum of K68,353.22 in damages for conversion respect of a motor vessel called MV Lahari. The appellant says that the proper value of the vessel was US$220,000.00.

The grounds of the appeal were:

“3.

(a) The National Court judge erred in fact in finding that the value of the vessel at the date of conversion was K68,353.22.

(b) The National Court judge erred in fact in not finding that the value of the vessel at the date of conversion was US$220,000.00.

(c) The National Court judge erred in fact in finding that the “only value that can be found” was the value of K68,353.22 being the amount set out in the respondents’ “Entry for Home Consumption” form (the entry form).

(d) The National Court judge erred in fact in giving weight to the value set out in the Entry form when Mr Justice Salika in this cause OS73/95 in his judgement delivered in April 1997 found (in entering judgement for the appellant against the respondents,) that:

(i) an officer of the respondents, Customs officer Loa had prepared the Entry form;

(ii) the appellant had not prepared nor signed the Entry form; and

(iii) that Customs officer Loa was corrupt and improperly carried out his responsibilities as an officer of the respondents.

(e) The National Court judge erred in fact in failing to find that there was evidence of the value of the vessel at the time of conversion other than the evidence set out in the Entry form, namely the oral evidence of the appellant given on 29 June 1999 and 15 July 1999 in this trial that the value of the vessel at the date of conversion was US$220,000.00.

(f) The National Court judge erred in fact in failing to give weight or sufficient weight to the evidence of the appellant set out in the last sub-paragraph.

(g) The National Court judge erred in fact in failing to give weight or sufficient weight to the affidavit evidence of Nancy Wilson Ives, sworn 25 March 1999 and tendered as Exhibit “D” in the assessment) of the value of the vessel at the date of conversion. The affidavit stated that the value, at the date of that affidavit of a newly built boat, the current equivalent of the vessel, was US$380,000.00.

(h) The National Court judge erred in fact in failing to give weight or sufficient weight to the oral evidence of the appellant set out in subparagraph (e) and the affidavit evidence of Nancy Wilson Ives set out in the last subparagraph such that overall, that evidence shows that

(i) the value of the vessel when purchased in October 1991 was US$220,000.00;

(ii) the vessel would have had the same value as at the date of conversion; and

(iii) such value was not inflated or unrealistic but was true and accurate.

4. The appellant seeks orders that

(a) That the value of the vessel at the date of conversion by the respondents was US$220,000.00.

(b) that the respondent pay damages and interest to the appellant as follows:

(i) value of vessel – US$220,000.00

(ii) personal property and costs – K34,633.00

(iii) freight costs – K21,593.20

(iv) interest on these amounts at 8% yearly from 27 June 1992”

The brief facts of the case were as follows. The appellant bought the said vessel in Taiwan and brought it into PNG in October 1991. Subsequently the respondents seized it in July 1992. The appellant then instituted proceedings in the National Court claiming that the respondents were negligent in seizing the said vessel and selling it.

In April 1997, Mr Salika J found the respondents liable and ordered that damages be assessed.

On 5 August 1999 Woods J after a trial assessed the value of the boat in the sum of K68,353.22. He also awarded some other amounts. The appellant’s complaint is against the assessment made as being inadequate. He says the value of the vessel at the time he bought it was US$220,000.00.

In the Court below the evidence relating to the value of the vessel came from the appellant and from a representative of the company from whom the appellant had bought the vessel. The appellant said he thinks he bought the boat for US$220,000.00. He was not sure of how much he paid.

The affidavit evidence from the supplier, merely stated what the price of similar boat was in 1999. The deponent did not state the value or price of the boat in 1991.

Then there was the evidence of the value of the boat as contained in the Entry for House Consumption (EFHC). In it the value of the boat was stated as K68,353.22. That document was prepared by someone on behalf of the appellant. The duty payable to the respondents was calculated on the value of K68,353.22 and the duty calculated was K20,000.00. The Appellant sent a cheque for that sum (K20,000.00) and lodged the EFHC and the cheque for the duty with a corrupt Customs officer (Loa). But Loa did not lodge the EFHC nor did he paid the duty. All these were subsequently returned by Loa to the appellant.

In the National Court, the trial judge accepted the amount contained in the EFHC as being the correct value of the boat. He did so on the basis that this figure was supported by the plaintiff’s own evidence of drawing a cheque for K20,000.00 payable to the respondents being 30% duty payable for the said boat on the basis of the value of the vessel as set out in EFHC. In the Court below there was no direct evidence of the value of the boat when it was first purchased in Taiwan in 1991. Neither was there any evidence of the value of the boat at the time it was seized and sold subsequently. The only evidence of any value was that set out in the EFHC coupled with the plaintiff’s own evidence of having someone prepare the EFHC, of considering the information in the EFHC, of having the EFHC lodge with a cheque for K20,000.00 being duty payable on the vessel.

It is submitted for the appellant that the trial judge’s finding that the only value that can be found for the vessel was the value set out in the EFHC was wrong. It was submitted that there were evidence of other value from the evidence of the appellant at the trial and of Nancy Ives.

These submissions invites this Court to disturb the findings and inferences made against the appellant in the trial.

It is settled law that an Appeal Court would be reluctant to interfere with findings of facts, unless such a finding is clearly erroneous. The question of what inferences may be drawn by a Court of Appeal and the duties of such court are also quite settled in this jurisdiction. The principle relating to these matters may be found in Kerr v Motor Vehicles Insurances (PNG) Trust [1979] PNGLR 251, at 275, Karo Gamoga v The State [1981] PNGLR 443, at 453, Rimbink Pato v Umbu Pupa [1986] PNGLR 310, at 316 – 317.

We would adept and apply the principles set out therein to the present case. The end result is that this court is in the same position as the trial judge to assess the value of the vessel on all the evidence that was given in the court below.

In the court below the evidence of Nancy Ives was in relation to what the value of a replacement value of a similar vessel was in 1999. Her evidence did not contain any evidence of the value of the vessel in 1991. Her evidence was of little weight at all. The appellants’ evidence was also of no real assistance at all. He gave a vague valuation of the vessel, when he bought it. He thought he bought it for US$220,000.00. But this is contradicted by his own evidence and conduct in accepting the valuation set out in the EFHC and drawing a cheque for 30% duty based on the figure contained in the EFHC and lodging the document and cheque with the Respondents.

We reject the submission that that document was prepared by the corrupt customs officer, Loa because the evidence is that it was prepared by another person. This document was shown to the appellant. He accepted it as correct and then acted upon it.

There was no direct evidence of the value of the vessel in 1991 either from the Appellant or Nancy Ives. The trial judge therefore, had to consider all the evidence before him and make any necessary findings of facts and make inferences based on those findings.

In our view, in this case, because of the lack of direct evidence on the value of the vessel in 1991 and coupled with the appellant’s own inconsistent evidence, it was open to the trial judge to make findings and inferences from all the evidence.

In this case the trial judge clearly did not accept the appellants’ vague oral evidence of the value of the vessel in 1991. Furthermore the appellant accepted the value of the vessel as set out in the EFHC, being the sum of K68,353.22. This document (EFHC) was prepared for the appellant and he accepted and acted upon it as setting out the true and correct value of the vessel. The trial judge accepted the value stated in the (EFHC). This finding was open to the trial judge.

We find that the trial judge was entitled to make those findings of facts and inferences. We are of the opinion that the Appellant has not demonstrated that the trial judge’s findings and inferences were manifestly erroneous. The Appeal must therefore be dismissed with costs to the Respondents.

Lawyers for the Appellants: Blake Dawson Waldon

Lawyer for the Respondents: Internal Revenue Commission