Kawaso Ltd v Oil Search (PNG) Ltd [2010] PGSC 34; SC1082 (16 November 2010)

SC1082

PAPUA NEW GUINEA
IN THE SUPREME COURT OF JUSTICE

SCA No. 77 of 2010

BETWEEN:

KAWASO LIMITED
Appellant/Applicant

AND:

OIL SEARCH (PNG) LIMITED
Respondent

Waigani: Sawong, J
2010: 08th & 16th November

SUPREME COURT – Practice & Procedure – Application for Stay – National Court Order – Order for costs – Consequential to order for dismissal of proceedings – No appeal against order for costs to stay relate – Whether Supreme Court has jurisdiction to stay.

SUPREME COURT- Practise & Procedure- application for stay must be by of an application by using Form 4 in the Supreme Court Rules- Application must not be by way of Notice of Motion- Appellant must state the nature of the application and the grounds for application.

Held:

1. There is no express provision in either the Supreme Court Act or the Supreme Court Rules as to the manner of an application for stay to the Supreme Court.
2. The proper manner is by an application using Form 4 of the Rules of Court.

3. An application for stay by way of a Notice of Motion would be incompetent and may be struck down.

4. An appellant /applicant must state the nature of the application and the grounds in the Application.

Cases cited in the judgment:

Gary McHardy v. Prosec Security & Communications Limited Trading as Protect Secretary (2000) SC 646.
National Capital Limited v. Benjamin Terence O'Dwyer & Port Moresby Stock Exchange (2010) SC 1053.

Counsels:

Mr. R J. Mann-Rai, for the Appellant/Applicant
Mr. T. Dawidi, for the Respondent

RULING

12th November, 2010

1. SAWONG, J: By a Notice of Motion the Appellant applies for a stay of an order for costs made in favour of the Respondent by the National Court on 3rd June 2010, pending the determination of its appeal. The respondent opposes the application and argues that stay should not be granted as the matter sought to be appealed against, (namely costs) deals with the exercise of discretion by the trial judge.
   
2. The application is brought by way of a Notice of Motion pursuant to s. 19 of the Supreme Court Act, (Chapter 37).The respondent also opposes the application on the basis that the application is not properly before the Court in that the application should not be by way of a Notice of Motion.
   
3. The application is brought under an appeal against the main decision in which the National Court dismissed the appellant's claim. The order for costs was consequential on the dismissal of the proceedings.
   
4. Two preliminary issues arise for determination. First is whether this Court has jurisdiction to stay an order for costs which has not been expressly stated or pleaded as a ground of appeal in the Notice of Appeal. Secondly, whether the application is properly before the Court.
   
5. I propose to deal with the second issue first. My reading of the Supreme Court Act and the Rules show that there is no express provisions relating to stay applications. However in practice the Court has assumed jurisdiction pursuant to s.19 of the Supreme Court Act to grant stay orders.
   
6. Section 19 of the Supreme Court Act, is the relevant provision relating to stay applications. It reads:
   

19. STAY OF PROCEEDINGS ON APPEAL.

Unless otherwise ordered by the Supreme Court or a Judge, an appeal, or an application for leave to appeal, to the Supreme Court does not operate as a stay of proceedings.

7. The principles of law governing applications for stay are now well established. These principles are set out in Gary McHardy v. Prosec Security & Communications Limited Trading as Protect Security (2000) SC 646. The Supreme Court said:
   

"We start with the principal premise that the judgment creditor is entitled to the benefits of the judgment. The others factors include the following:

1. Whether leave to appeal is required and whether it has been obtained;
2. Whether there has been any delay in making the application.
3. Possible hardship, inconvenience or prejudice to either party.
4. The nature of the judgment sought to be stayed.
5. The financial ability of the applicant.
6. Preliminary assessment about whether the Applicant has an arguable case on the proposed appeal.
7. Whether on the face of the record of the judgment there may be indicated apparent error of law or procedure.
8. The overall interest of justice.
9. Balance of convenience.
10. Whether damages would be sufficient remedy."
    
8. As can be seen, an applicant for stay, must satisfy 10 factors or requirements before a stay is granted.
   
9. In the present case, Counsel for Appellant, Mr. Mann-Rai submitted that the Appellant in the Notice of Appeal has sufficiently pleaded so as to cover the issue appealed against the order for cost, such that stay should be granted. I shall consider this submission in the latter part of my ruling.
   
10. Counsel for the respondent, Mr. Dawidi objects to the form in which the application for stay is before the Court. He submitted that in order for the application to succeed, the appellant must properly invoke the jurisdiction of the Supreme Court by filing the appropriate forms. In this case, he submitted that the appellant has filed a Notice of Motion and Undertaking as to Damages which is inappropriate and and not the proper way to invoke the jurisdiction of the Court.
    
11. Counsel for the Appellant has not argued this particular point. Both counsels have not really assisted the Court in determining this issue.
    
12. The issue raised is an interesting point. There is no express provision in either the Supreme Act, ch. 37 or the Supreme Court Rules regarding stay applications and the manner in which such an application is to be brought before either a single Judge or full Court of the Supreme Court. The only provision that gives any indication is s. 19 of the Supreme Court Act.
    
13. But this provision is of no real assistance at all because it does not provide any guide as to the manner of making such application before the Supreme Court. There is also no express provision in the Supreme Court Rule as to the manner of how an application for stay maybe brought before the Supreme Court.
    
14. Consequently, I considered some other provisions of the Rules such as Order 7 of the Rules to gain some assistance, by way of an analogy to determine this issue. In general an appeal to the Supreme Court is either by way of Notice of Appeal under Order 7 or by way of Notice of Motion under Order 10 of the Rules.
    
15. Order 10 of the Rules prescribes the manner of appeals to the Supreme Court relating to judicial review matters. Such an appeal is by way of a Notice of Motion.
    
16. I consider that because an application for stay stems from a Notice of Appeal or an Application for Leave to Appeal, an application for stay should be by way of application.
    
17. An appellant who desires to invoke this Court's jurisdiction on stay must do so by an Application to the Supreme Court. The application must state the nature of the application and the grounds warranting a stay. An application of this nature should use Form 4 of the Supreme Court Rules.
    
18. In the present case, the Appellant has come improperly before the Court. It has come by a Notice of Motion rather than by way of an application. In the circumstances the matter is not properly before the Court and should be dismissed for that reason alone. Even then no grounds have been pleaded or stated in the Notice of Motio.
    
19. I now turn to consider the first issue. The issue here is whether the Supreme Court has jurisdiction to stay an order for costs, which has not been expressly stated or pleaded as a ground of appeal in the Notice of appeal.
    
20. The issue I have referred to has not been judicially considered before. However, the learned Chief Justice, has recently considered this very issue in National Capital Limited v. Benjamin Terence O'Dwyer & Port Moresby Stock Exchange (2010) SC 1053.
    
21. In the Judgment His Honour referred to s. 14, 17 & 19 of the Supreme Court Act, and Order 7 Division 3, Rule 6 – 8 of the Supreme Court Rules. After setting out these provisions, His Honour said at page 3:
    

"10. Costs is generally a discretionary matter for the National Court. Leave of the Court is necessary to appeal from an order for costs per se or to use the exact words of s. 14(3)(c), "an order...as to costs only". It follows that leave to appeal is not necessary in an appeal against a judgment in which judgment for costs is incidental or consequential to the main judgment. The appellant may appeal against the order for costs in the same appeal against the main judgment, without leave, and the Supreme Court can assume jurisdiction to deal with the matter. It appears this interpretation of s 14(3)(c) is not supported by any previous decisions of this Court."

22. After discussing some English authorities, His Honour said at page 4:
    

"13. It is apparent from a collective reading of Supreme Court Act, s 14(3)(c), s17 and s 19 and SCR, O 7 rr6 – 8 that in order to vest jurisdiction in the Supreme Court to review award for costs on appeal, there must be an appeal against an order for costs that is pending determination to which the application for stay relates. The notice of appeal must state the whole or part of the decision on costs appealed from and the grounds of appeal which relate to it. If, in the notice of appeal, the whole or part of the decision on costs is not specified or there are no grounds of notice of appeal relating to that part of the decision on costs, it cannot be said that an appeal against an order for costs is pending. The Court therefore lacks jurisdiction to deal with an application for stay in relation t the order for costs."

23. I would adopt and apply these principles as my own. In my view, the interpretation given by the learned Chief Justice, is sound and correct.
    
24. The grounds of appeal are set out in ground 3 of the Notice of Appeal. There are 7 grounds and these are:
    
25. A careful reading of each of the grounds of appeal shows that non of the grounds pleaded relate to the order for costs. In the Notice of Appeal, the appellant does not specifically plead that it is appealing against the order for costs. The order for costs is not specifically challenged as a ground of appeal in the Notice of Appeal. The grounds of appeal relate to the main judgment and not the order for costs.
    
26. Thus, in my opinion, as there are no grounds of appeal relating to costs, it cannot be said that an appeal against costs is pending before the Supreme Court. In effect, there is no appeal against the order for costs pending before the Supreme Court.
    
27. The deponent does not depose the hardship, if any, that it will suffer if the orders are not stayed.The appellant has not demonstrated that it has an arguable case in so far as the question of costs is concern.
    
28. Furthermore, the affidavit of Mr. Wilson does not satisfy the test for stay as setout by the Supreme Court in Gary McHardy v. Prosec Security (supra).
    
29. The grounds of appeal relate to the main part of the decision of the learned trial judge. No specific ground of appeal against the order for costs has been pleaded or stated in the Notice of Appeal.
    
30. For those reasons, I refuse to grant a stay order. I dismiss the application with costs.
    

_____________________________________________
Warner Shand Lawyers: Lawyers for the Appellant
Oil Search Limited: Lawyers for the Respondent