Mataio v August [2014] PGSC 60; SC1361 (4 July 2014)

SC1361

PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]

SCA NO 83 0F 2013

RAKATANI MATAIO
Appellant

V

JACK AVU AUGUST
First Respondent

THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Second Respondent

ROBERT VOLO
Third Respondent

Waigani: Cannings J, Gabi J, Hartshorn J
2014: 2, 4 July

PRACTICE AND PROCEDURE – dismissal of proceedings on own initiative of National Court – whether Court obliged to put plaintiff on notice of Court's consideration of question of dismissal – principles of natural justice – whether Court obliged to state jurisdictional basis of order for dismissal of proceedings.

The plaintiff in National Court proceedings applied by notice of motion for default judgment on the ground that the defendants failed to file a defence. The Court, after hearing the motion, refused the application for default judgment and dismissed the entire proceedings for three reasons: (a) as being incompetent for non-compliance with Section 5(2) of the Claims By and Against the State Act, (b) as being statute-barred under Section 16(1) of the Frauds and Limitations Act and (c) as the pleadings were incontestably bad. The plaintiff appealed to the Supreme Court against the order for dismissal on two grounds: (1) failure to give him an opportunity to be heard as to why the proceedings should not be dismissed; (2) error of law in finding that the Claims By and Against the State Act was not complied with and that the claims were statute-barred.

Held:

(1) If a Court is giving consideration on its own motion to dismissing proceedings it must, in order to discharge its duty to conduct its proceedings in accordance with the principles of natural justice (the minimum requirements being to act fairly and be seen to act fairly), put the plaintiff on notice that consideration is being given to the question of dismissal (Mahon v Air New Zealand Ltd [1984] 3 All ER 201).

(2) The notice given must be sufficient to enable the plaintiff to fully appreciate the possible consequences and to prepare and make submissions to the Court; and the notice would normally be expected to include a reference to the jurisdictional basis on which an order for dismissal might be made.

(3) Here the Court did not put the plaintiff on notice that consideration was being given to the question of dismissal. The plaintiff was consequently not given the opportunity to address the Court on issues pertaining to the question of dismissal. This was a breach of the principles of natural justice. Ground (1) was upheld and that was a sufficient basis on which to allow the appeal.

(4) It was unnecessary to consider the second ground. The appeal was allowed and the proceedings were remitted to the National Court.

Cases cited
Papua New Guinea Cases

Bernard Steven Philipae v Atio Igaso (2011) N4366
John Yula Andma v Timothy A Morasa (2013) N5224

Overseas Cases

Mahon v Air New Zealand Ltd [1984] 3 All ER 201

APPEAL

This was an appeal against an order of the National Court which dismissed the entire National Court proceedings.

Counsel

N Kera, for the appellant
T Tanuvasa & V Vate, for the respondents

4th July, 2014

1. BY THE COURT: Rakatani Mataio appeals against the dismissal by the National Court of proceedings he commenced against the Chief Magistrate, the State and a Police officer.

2. In WS No 1096 of 2011 the appellant claimed damages for unlawful termination from employment, malicious prosecution, defamation and breaches of human rights. He applied by notice of motion for default judgment on the ground that the respondents failed to file a defence. The Court, on 7 July 2013, refused the application for default judgment and dismissed the entire proceedings (a) as being incompetent for non-compliance with Section 5(2) of the Claims By and Against the State Act, (b) as being statute-barred under Section 16(1) of the Frauds and Limitations Act and (c) as the pleadings were incontestably bad. The following order was entered:

1. The plaintiff's application for default judgment is refused.
2. The proceeding is dismissed.
3. The plaintiff pay the defendants' costs.
4. Time is abridged.
   

THE APPEAL

3. The appellant appeals against order Nos 2 and 3. He does not challenge order No 1, refusal of the application for default judgment, or order No 4. He appeals on two grounds (1) failure to give him an opportunity to be heard as to why the proceedings should not be dismissed; (2) error of law in finding that the Claims By and Against the State Act was not complied with and that the claims were statute-barred.

NATURAL JUSTICE

4. It is undisputed that the National Court, along with all other courts in the National Judicial System, is obliged to conduct its proceedings fairly, in accordance with the principles of natural justice (Bernard Steven Philipae v Atio Igaso (2011) N4366, John Yula Andma v Timothy A Morasa (2013) N5224). This is a fundamental obligation arising not only under the underlying law but also because it is one of the Basic Rights conferred by Section 37(11) (protection of the law) of the Constitution, which states:

A determination of the existence or extent of a civil right or obligation shall not be made except by an independent and impartial court or other authority prescribed by law or agreed upon by the parties, and proceedings for such a determination shall be fairly heard within a reasonable time. [Emphasis added]

5. The duty of a court to accord natural justice to parties and to conduct its proceedings fairly is reinforced by Section 59 (principles of natural justice) of the Constitution, which states:

(1) Subject to this Constitution and to any statute, the principles of natural justice are the rules of the underlying law known by that name developed for control of judicial and administrative proceedings.

(2) The minimum requirement of natural justice is the duty to act fairly and, in principle, to be seen to act fairly.

6. The principles of natural justice and procedural fairness must be given practical effect in every court proceeding. In the present case, this simple but fundamental practice, emphasised by the Privy Council in Mahon v Air New Zealand Ltd [1984] 3 All ER 201, should have been invoked: if a court (or tribunal or a commission of inquiry, as in Mahon) is considering, on its own motion, making any finding, order or other decision adverse to any of the parties to the proceedings, it must put the party on notice that consideration is being given to such a decision so that the party has an adequate opportunity to address the court on the relevant issues and deter the court from making such a decision.

7. This means that if the National Court is considering dismissing proceedings of its own motion, notice given to the party who instituted the proceedings must be sufficient to enable the party to fully appreciate the possible consequences and to prepare and make submissions to the Court. The notice, which might be in writing or simply given orally, would normally be expected to include a reference to the jurisdictional basis on which an order for dismissal might be made.

8. We find nowhere in the transcript of the proceedings any express or implied or tacit statement or indication by the primary Judge that his Honour was giving consideration to the question of dismissal of the proceedings. The only matter before the Court was the appellant's application for default judgment. There was no application by the respondents to dismiss the proceedings. In fact the respondents did not appear at any stage of hearing the application. After hearing the appellant's counsel, Mr Kera, in support of the application for default judgment, his Honour adjourned for a ruling.

9. His Honour, however, recalled the matter on 17 June 2013 and invited counsel for the appellant to address the Court on two issues: the Section 5 Claims By and Against the State Act issue and the issue of whether the appellant's claims might be statute-barred under the Frauds and Limitations Act. Mr Kera was on leave that day and another counsel, Ms Makanuey, appeared but was unable to assist the Court, so his Honour adjourned to allow Mr Kera to again appear.

10. The hearing, which ostensibly only concerned the appellant's application for default judgment, resumed on 1 July 2013. Mr Kera appeared and his Honour invited him to make submissions on the two issues alluded to on 17 June 2013. Mr Kera made brief submissions on those issues, evidently not appreciating that his Honour saw those submissions as relevant to the question of not only whether the application for default judgment should be granted but also to whether the proceedings should be dismissed. His Honour adjourned to 9 July for "a ruling". His Honour did not state what the ruling would be on. In our view the only reasonable inference to be drawn from what his Honour stated, given that he had not made any mention of the prospect of the proceedings being dismissed, is that it would be a ruling on the application for default judgment, and nothing more.

11. His Honour did not put the appellant on notice that he was considering dismissing the entire proceedings. His Honour did not indicate the jurisdictional basis for the proposed dismissal. He did not mention, for example, that he was considering exercising the power of the Court on its own motion to dismiss the proceedings under Order 12, Rule 40 (frivolity etc) of the National Court Rules for disclosing no reasonable cause of action, or to summarily determine the proceedings under Order 10, Rule 9A(15) (summary disposal) of the National Court Rules on competency grounds or that he was considering invoking the inherent jurisdiction of the Court to protect its processes against abuse. His Honour made no mention at all of one of the reasons he gave for dismissing the entire proceedings – that the pleadings were incontestably bad.

CONCLUSION

12. The appellant was not given the opportunity to address the Court on issues pertaining to the question of dismissal. This was, with respect, a breach of the principles of natural justice and a serious procedural error. Ground (1) of the appeal is upheld and that is a sufficient basis on which to allow the appeal. It is unnecessary to deal with ground (2). The proceedings will be reinstated in the National Court. Costs will follow the event.

ORDER

(1) The appeal is allowed.

(2) Order Nos 2 and 3 of the National Court of 9 July 2013 in WS No 1096 of 2011 are quashed.

(3) The proceedings WS No 1096 of 2011 are reinstated and remitted to the National Court for directions.

(4) Costs of the appeal shall be paid by the respondents to the appellant on a party-party basis, which shall, if not agreed, be taxed.

Judgment accordingly.
_______________________________________________________________
Young & Williams Lawyers: Lawyers for the Appellant
Solicitor-General: Lawyer for the Respondents