Telikom PNG Ltd v Tulin [2004] PGSC 29; SC748 (2 June 2004)

SC748

PAPUA NEW GUINEA

[IN THE SUPREME COURT OF JUSTICE AT WAIGANI]

SCA NO. 44 OF 2000

BETWEEN:

TELIKOM PNG LIMITED
Appellant

AND:

THOMAS TULIN
Respondent

WAIGANI: Injia Dep. CJ, Sakora & Batari JJ.
2004 : April 27, June 2

SUPREME COURT APPEAL – Civil Law – Practice and procedure – Distinction between summary judgement and default judgment – Misconception of procedure – Error in exercise of discretion – Summary judgement quashed.

No cases cited in the judgement

Counsel:
I. Molloy with S. Ketan for the Appellants
E. Waisaf for the Respondent

2 June 2004

BY THE COURT: This is an appeal against a summary judgement given by the National Court on 15th June 2000. The Court granted summary judgement on liability for damages to be assessed on a claim for breach of contract of employment.

The short facts are that on 8th July 1999, the Respondent commenced proceedings against Minister for Communications (First Defendant) and the Appellant (2nd Defendant) seeking specific performance or damages for breach of Employment Contract. The claim arose out of the Appellants’ employment as the Managing Director of the Appellant. The Writ was served on the Defendants and both Defendants filed Notices of Intention to Defend. It is not clear when the Writ was served and notices of intention to defend filed. On 22nd September the Appellant filed an Interim Defence. The first Defendant did not file his Defence. On 23rd September 1999 the Respondent moved a Notice of Motion for summary judgment but it did not specify if summary judgment was being sought against the First Defendant or Second Defendant, jointly or severally. The Notice of Motion was supported by an affidavit of the Respondent sworn on "5th June 1999" and affidavit of Philip Kuimb.

The motion was fully argued before the Court. The Defendants were separately represented. The Respondent’s counsel informed the Court that he was unaware of any Defences being filed by either Defendants. Mr Parkop for the Second Defendant referred to his Interim Defence filed in Court the previous day, which he had not served yet, in which his client raised the defence of lack of authority of the person acting for the Appellant to contract. He said he would file and serve "a confirmed defence." Mr Tuva for the First Defendant relied on s.9 of the Claims By and Against the State Act. He submitted since the Writ was filed on 9th July 1999, he had 90 days to file a defence which fell due on 12th October 1999, and he would file the Defence before the due date. The Respondents’ counsel had no response to this submission.

The judgement of the Court appealed from is very brief. We set out the judgement in full:

"Mr Kuimb moved on behalf of the Plaintiff to enter summary judgement for K1,186,487.90. In the alternative, an order was sought for Specific performance under Clause 6.4(f) and 6.5 of the Contract that is to pay the Plaintiff the sum of K1,186,497.90 forthwith. No defence has been filed by either Defendant. This suit is on contract and no defence had been shown except general assertion in court that contract was not approved and hence void. The second defendant did not want to know anything pleading lack of notice under Claim Against the State Act. I therefore enter summary judgment against the defendants. The Summary judgement is on liability only for the amount claimed to be appropriately assessed."

There are three (3) grounds of appeal but they raise the same point - that the Court erred in law and in fact in finding that the Appellant did not file a Defence. On the contrary, the Appellant did file a Defence to the claim and had the Court considered the defences raised in the Defence, summary judgment would not have been granted.

Both counsel made submissions on the nature of the Respondent’s claim, the merits of the defences and on other procedural issues but we do not consider it is necessary to deal with all of them. We consider that our determination on the issues of whether the Appellants filed their defences, and if so, whether they were considered by the Court, may be dispositive of this appeal.

The Court found that "No defence was filed by either Defendant" but it failed to address its mind to the interim Defence filed by the Appellant which was before the Court. The Court failed to find the Appellant had defaulted in filing its Defence. The finding that the Appellant did not file a Defence is clearly wrong because it did file a Defence in the form of an interim Defence which was before the Court. His Honour did not consider the defences raised in that Interim Defence. We are satisfied that this failures amount to a grave error of fact and law, which vitiates the very foundation on which the summary judgement against the Appellant is based.

The First Defendant, the Minister for Communication, has not appealed against the summary judgement entered against him. Nonetheless, the summary judgment as it states now cannot lawfully apply to it. The Court failed to address the First Defendant’s indication that it would file its Defence by the due date. The Court failed to find the First Defendant had defaulted in filing its Defence. No judgment should have been given against the First Defendant because its time period to file its Defence was still current and he was not in default. We are also satisfied that the Court erred in entering summary judgement against the First Defendant.

Further, there appears to be a confusion on the Court’s part between the procedure for summary judgement and default judgment. The summary judgment appears to be in the nature of a default judgement. The judgment was given on the default of the Defendants in filing their Defences. There was no consideration the interim defence filed by the Appellant and the affidavit of the Plaintiff denying to the points of his Claim. The Respondent sought summary judgement and his counsel argued on the requirements of O 12 r 39. These arguments were not considered by the Court. When there is no consideration of these matters, and the judgment is purely based on the default of a party in filing pleadings, the judgment is not a summary judgement under O12 r 38. The judgment is a default judgment under O12 r 28. These two types of judgment are distinct and have their own factual basis and attendant procedural requirements, and principles. We are satisfied that the Court clearly erred in granting a default judgment in the guise of a summary judgement, a judgement which the Respondent did not seek before the Court. We are satisfied that the Court erred in misconceiving the nature of the application made before it.

This is an appeal from discretionary judgment on a procedural matter within the Court’s jurisdiction. The appellate Court must be slow to interfere with the exercise of such discretion unless the exercise of that discretion is clearly wrong. We are satisfied that the exercise of the Court’s discretion in this case is clearly wrong for the reasons given above.

We allow the appeal and quash the entire summary judgment. We award costs of the appeal to the Appellant. We certify Southern counsel.
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Lawyer for the Appellant : Ketan Lawyers
Lawyer for the Respondent : Nonggorr & Associates Lawyers