Habolo Building & Maintenance Ltd v Hela Provincial Government [2016] PGSC 67; SC1549 (23 November 2016)

SC1549

PAPUA NEW GUINEA

[IN THE SUPREME COURT OF JUSTICE]

SCA NO 27 OF 2016

HABOLO BUILDING & MAINTENANCE LIMITED
Appellant

V

HELA PROVINCIAL GOVERNMENT
First Respondent

WILLIAM BANDO, ACTING PROVINCIAL ADMINISTRATOR
Second Respondent

Waigani: Cannings J, Kassman J, Poole J

2016: 24 October, 23 November

PRACTICE AND PROCEDURE – Claims By and Against the State Act, Section 5 –notice of intention to make claim against the State to be given within six months after “occurrence out of which the claim arises” – determination of date of occurrence if a cause of action of trespass is pleaded – whether the date of occurrence is when the trespass was first committed – whether date of occurrence continues from day to day, as a continuing occurrence.

PRACTICE AND PROCEDURE – Claims By and Against the State Act, Section 5 – whether necessary to give notice under Section 5 prior to commencing legal proceedings against a Provincial Government.

The appellant appealed against the decision of the National Court to dismiss proceedings it commenced against the respondents, including a provincial government, for failure to comply with the notice requirements of Section 5 of the Claims By and Against the State Act. In its statement of claim in the National Court, the appellant pleaded a cause of action in trespass, constituted by unlawful entry by the provincial government on to the appellant’s land and erection of a building on it, which began in 2012 and continued until the date of filing of the writ, 30 November 2015. The appellant gave a Section 5 notice on 17 November 2015. Section 5of the Claims By and Against the State Act provides that “No action to enforce any claim against the State lies against the State unless notice in writing of intention to make a claim is given in accordance with this Section by the claimant ... within a period of six months after the occurrence out of which the claim arose”. The primary Judge held that “the occurrence” arose in March 2012 and that the appellant, being obliged to give notice within six months after that, had to give notice in 2012. It did not give notice until November 2015, which was about three years late. The primary Judge held that, as compliance with Section 5 is a condition precedent to commencement of proceedings against the State, the proceedings were an abuse of process and were therefore dismissed. The appellant’s central ground of appeal was that the primary judge erred in regarding “the occurrence” as a single event, occurring in 2012; his Honour should have found that the claim arose out of a series of continuing occurrences that occurred from 2012 to the date of filing of the writ.

Held:

(1) It is a condition precedent to commencement of proceedings against the State that the plaintiff give notice, prior to commencement of the proceedings, of the intention to make a claim in accordance with Section 5 of the Claims By and Against the State Act.

(2) One of the requirements of a Section 5 notice is that it be given “within a period of six months after the occurrence out of which the claim arose”.

(3) “The occurrence” might be a single occurrence or a series of occurrences, depending on the nature of the cause of action and the facts pleaded in the originating process by which legal proceedings are commenced.

(4) Here, “the occurrence” was, having regard to the cause of action and the facts pleaded in the statement of claim, a series of occurrences, commencing in 2012 and continuing until filing of the writ. The occurrences recurred from 2012 until at least 18 May 2015. The appellant, by giving notice on 17 November 2015, gave notice within the six-month period after “the occurrence” out of which the claim arose.

(5) The notice given was compliant with Section 5. The primary Judge erred by disregarding the continuing occurrences. The appeal was allowed and the proceedings were remitted to the National Court.

(6) Obiter dictum: Before the National Court, and also before the Supreme Court, it was presumed that the appellant was obliged to give a Section 5 notice before commencing proceedings. In fact, a Section 5 notice was not necessary as there was no claim against “the State”. If a person sues a provincial government, as distinct from the State, and does not sue the State, it is not necessary to give a Section 5 notice (MAPS Tuna Limited v Manus Provincial Government (2007) SC857 considered).

Cases cited

The following cases are cited in the judgment:

Cartledge v E Jopling & Sons Ltd [1963] AC 758
Clarkson v Modern Foundries [1957] 1 WLR 1210
Crumbie v Wallsend Local Board [1891] UKLawRpKQB 17; [1891] 1 QB 503
Forster v Outred [1982] 1 WLR 86
Huyton v Liverpool Corporation [1926] 1 KB 146
John Wasis v Southern Highlands Provincial Government (2008) N4515
Konskier v B Goodman Ltd [1928] 1 KB 421
MAPS Tuna Limited v Manus Provincial Government (2007) SC857
Otto Benal Magiten v William Moses (2006) N5008
Public Curator v Konze Kara as Administrator of the estate of Kibikang Kara (2014) SC1420
SCR No 1 of 1998; Reservation Pursuant to Section 15 of the Supreme Court Act (2001) SC672
Stanis Leda v Stettin Bay Lumber Company Ltd (2011) N4542
Steven Punagi v Pacific Plantation Timber Ltd (2011) SC1153
UBAF Ltd v European American Banking Corporation [1984] QB 713

APPEAL

This was an appeal against a decision of the National Court, dismissing proceedings commenced against a provincial government, for failure to comply with the notice requirements of Section 5 of the Claims By and Against the State Act.

Counsel:

A J Apo, for the Appellant
J Aku, for the Respondents

23 November, 2016

1. BY THE COURT: Habolo Building & Maintenance Ltd, the appellant, appeals against the decision of the National Court, constituted by Justice Hartshorn, to dismiss proceedings it commenced against the respondents, Hela Provincial Government and William Bando, for failure to comply with the notice requirements of Section 5 of the Claims By and Against the State Act. The main issue in the appeal concerns the time within which a person has to give notice of their intention to make a claim against the State.

OBJECTION TO COMPETENCY

2. Before embarking on determination of the appeal, we record the fact that there was an informal objection to the competency of the appeal raised by Mr Aku, for the respondents. We call it informal as the argument put to us was not the subject of a notice of objection to competency and was made at the start of Mr Aku’s submissions without notice to opposing counsel, Mr Apo. The argument was that the jurisdictional basis of the appeal was incorrectly stated in the notice of appeal as Section 4 of the Supreme Court Act, as the correct jurisdictional basis is Section 14(3)(b), due to this being an appeal against an “interlocutory judgment” of the National Court.

3. We find no merit in the objection. The Supreme Court decided in Steven Punagi v Pacific Plantation Timber Ltd (2011) SC1153 that any judgment of the National Court that has the effect of finally determining proceedings, including dismissal of the proceedings, is a final judgment, not an interlocutory judgment. That is so irrespective of whether such an order follows a full trial or whether it is the result of granting an interlocutory application such as an application for dismissal of the proceedings on grounds such as want of prosecution or, as in this case, failure to comply with a statutory precondition to commencement of proceedings.

4. The present appeal is not an appeal against an interlocutory judgment. Leave to appeal was not required. The jurisdictional basis of the appeal is not Section 14(3) of the Supreme Court Act. The appeal is not incompetent. We now address the merits of the appeal.

BACKGROUND

5. The appellant is the registered proprietor of a block of land at Tari, Hela Province. It was granted a 99-year business lease over the land on 14 February 2012. It alleges that in or about March 2012 the Hela Provincial Government entered the land without its consent and erected a building on it, which is being used for provincial government purposes, and has paid no rent and has resisted the appellant’s attempts to settle the matter out of court.

6. On 30 November 2015 the appellant commenced proceedings, by writ of summons, against the provincial government and the provincial administrator. In its statement of claim, the appellant pleaded a cause of action in trespass, constituted by unlawful entry by the first respondent on to the appellant’s land and erection of a building on it, which began in 2012 and continued until the date of filing of the writ, 30 November 2015. The appellant claimed mesne fees of K1, 440,000.00 and an order that the respondents give vacant possession within two weeks.

7. Prior to filing the writ, the appellant, on 17 November 2015, gave notice in writing to the Solicitor-General, purporting to be a notice under Section 5(1) of the Claims By and Against the State Act, of its intention sue Hela Provincial Government in regard to the unlawful occupation and use of its land at Tari.

RESPONDENTS’ NOTICE OF MOTION

8. Before the matter went to trial, the respondents by notice of motion sought dismissal of the entire proceedings on a number of grounds including failure to serve the Section 5 notice within the time prescribed by the Act.

Section 5 (notice of claims against the State) states:

(1) No action to enforce any claim against the State lies against the State unless notice in writing of intention to make a claim is given in accordance with this Section by the claimant to —

(a) the Departmental Head of the Department responsible for justice matters; or

(b) the Solicitor-General.

(2) A notice under this Section shall be given —

(a) within a period of six months after the occurrence out of which the claim arose; or

(b) where the claim is for breach of a contract, within a period of six months after the claimant became aware of the alleged breach; or

(c) within such further period as —

(i) the Principal Legal Adviser; or

(ii) the court before which the action is instituted,

on sufficient cause being shown, allows.

(3) A notice under Subsection (1) shall be given by —

(a) personal service on an officer referred to in Subsection (1); or

(b) leaving the document at the office of the officer with the person apparently occupying the position of personal secretary to that officer between the hours of 745 am and 12 noon, or 100 pm and 406 pm, or such other hours as may from time to time be declared by or under the Public Services (Management) Act 1995 to be the normal public service hours of duty, on any day which is not a Saturday, Sunday or a public holiday declared by or under the Public Holidays Act (Chapter 321).

9. For the purposes of the appeal, the critical part of Section 5 concerns the timing of the notice. Sections 5(1) and (2)(a) provide:

No action to enforce any claim against the State lies against the State unless notice in writing of intention to make a claim is given in accordance with this Section by the claimant ... within a period of six months after the occurrence out of which the claim arose.

NATIONAL COURT’S REASONING

10. The primary Judge, in upholding the respondents’ motion for dismissal of the proceedings, ruled that “the occurrence” arose in March 2012 and that the appellant, being obliged to give notice within six months after that, had to give notice in 2012. It did not give notice until 17 November 2015, which was about three years late.

His Honour stated:

In the written submissions of Habolo, it is stated under “cause of action” that the defendants occupied the land in 2012. The relief that is being sought, mesne fees or profits from 2012 to 2015, is indicative of Habolo believing that it has a claim since 2012. The term mesne profits is only another term for damages for trespass. The fact that the late Sir Matiabe Aruru may have entered into some understanding with the Hela Provincial Government, does not detract from the fact that the occurrence out of which Habolo’s claim arose, and upon which its claim is pleaded in the statement of claim, is the fact pleaded that the Hela Provincial Government encroached sometime in 2012.

For the reasons given, I am satisfied that the purported notice given pursuant to Section 5(1) of the Claims By and Against the State Act was given out of time. Consequently, as a condition precedent has not been complied with, the proceeding is an abuse of process and does not disclose a reasonable cause of action.

His Honour consequently dismissed the proceedings for failure to comply with the notice requirements of Section 5 of the Claims By and Against the State Act.

WHAT DOES “THE OCCURRENCE” REFER TO?

11. The appellant’s central ground of appeal is that the primary judge erred in regarding “the occurrence” as a single event, occurring in 2012: his Honour should have found that the claim arose out of a series of continuing occurrences from 2012 to the date of filing of the writ.

12. We uphold the submissions of Mr Apo, for the appellant, that in ruling that the appellant’s claim arose out of a single event, the learned primary Judge erred in law. In the case of a cause of action such as the tort of trespass, where the elements of the cause of action include proof of damage, and where the damage recurs continuously, “the occurrence” out of which the claim arises is properly regarded as, in fact and law, a series of occurrences. This means that the six-month period within which notice has to be given under Section 5 does not commence to run until the occurrences cease.

13. In taking this approach, we rely on the reasoning of the Supreme Court (David J, Yagi J & Murray J) in Public Curator v Konze Kara as Administrator of the estate of Kibikang Kara (2014) SC1420. Konze Kara, administrator of a deceased estate, sued the Public Curator, the previous administrator of the estate, in negligence, claiming that the Public Curator had negligently administered the estate over a continuous period from the date of the Public Curator’s appointment as administrator, in 1992, to the date of Mr Kara’s appointment as replacement administrator, in 2006.

14. Mr Kara commenced proceedings against the Public Curator in 2009. The Public Curator applied for dismissal of the proceedings on the ground that it was time-barred under the Frauds and Limitations Act, as the proceedings had not been commenced within six years after the date on which the cause of action accrued, which he claimed was in 1992. The issue was whether the cause of action accrued in 1992, when the tort of negligence was allegedly first committed, or whether it continued to accrue until 2006, during which time it was alleged that the tort of negligence continued to be committed by the Public Curator.

15. The Court held that the cause of action continued to accrue in the period from 1992 to 2006, and that the writ was filed within six years of the last date of accrual of the cause of action. In taking that approach the Supreme Court endorsed the reasoning of the primary judge, that in the case of a tort that is actionable only on proof of damage, such as negligence, the cause of action accrues when the damage occurs. Such torts are continuous and a fresh cause of action arises daily as the tort continues (Konze Kara v Public Curator (2010) N4055). A long line of persuasive British authority in support of that approach was cited by the Supreme Court, including Crumbie v Wallsend Local Board [1891] UKLawRpKQB 17; [1891] 1 QB 503, Huyton v Liverpool Corporation [1926] 1 KB 146, Konskier v B Goodman Ltd [1928] 1 KB 421, Clarkson v Modern Foundries [1957] 1 WLR 1210, Cartledge v E Jopling & Sons Ltd [1963] AC 758, Forster v Outred [1982] 1 WLR 86 and UBAF Ltd v European American Banking Corporation [1984] QB 713.

16. We note that the same approach has been taken in a number of other National Court cases, including Otto Benal Magiten v William Moses(2006) N5008, John Wasisv Southern Highlands Provincial Government (2008) N4515 and Stanis Leda v Stettin Bay Lumber Company Limited (2011) N4542.

17. We appreciate that in those cases the question was whether the proceedings were commenced within six years after the date on which the “cause of action accrued”, for the purposes of the Frauds and Limitations Act, whereas in the present case the question is whether notice was given within six months after the “occurrence out of which the claim arose”. The terminology is different, but the principles to apply when determining the date on which a cause of action accrued are, we consider, the same as those to be applied when determining the date on which an occurrence arose. If the cause of action being pleaded is capable of being regarded as a continuing cause of action, accruing on a daily basis, the corollary is that the “occurrence out of which the claim arose” should be regarded as a series of occurrences.

18. We consider, with respect, that the learned primary Judge erred in law in regarding “the occurrence” out of which the appellant’s claim arose as consisting of a single event occurring in 2012, and finding that the appellant had not given notice within six months after the occurrence. It follows that the decision to dismiss the proceedings was made in error.

REMARKS

19. Before concluding, there is an important issue that has been raised by this appeal, on which we need to make some remarks. It was not mentioned in the National Court. Nor was it mentioned at the hearing of the appeal, until we raised it with counsel.

20. It has been presumed that the appellant was obliged to give a Section 5 notice before commencing the proceedings. In fact, a Section 5 notice was not necessary as there was no claim against “the State”. If a person sues a provincial government, as distinct from the State, and does not sue the State, it is not necessary to give a Section 5 notice.

21. There were indications to the contrary in SCR No 1 of 1998; Reservation Pursuant to Section 15 of the Supreme Court Act (2001) SC672, in which the Supreme Court (Amet CJ, Los J, Sheehan J, Salika J and Sakora J) held that the term “the State” in Section 13 (no execution against the State) of the Claims By and Against the State Act includes provincial governments.

22. However, in the case of Section 5 of the Act and the question of whether it is necessary to give notice before commencing proceedings against a provincial government, the issue has been put to rest by the decision of the Supreme Court in MAPS Tuna Limited v Manus Provincial Government (2007) SC857: it is not necessary to give a Section 5 notice to the Secretary for Justice or the Solicitor-General if proceedings are commenced only against a provincial government and/or an individual person and not against the State.

CONCLUSION

23. As we have upheld the appellant’s primary ground of appeal, the issue arises as to what orders we should now make. In a civil appeal the Court’s discretion is exercised under Section 16 (decision etc on appeal) of the Supreme Court Act, which states:

On the hearing of an appeal, the Supreme Court shall inquire into the matter and may—

(a) adjourn the hearing from time to time; or

(b) affirm, reverse or modify the judgment; or

(c) give such judgment as ought to have been given in the first instance; or

(d) remit the case in whole or in part for further hearing; or

(e) Order a new trial.

24. Further, under Section 6(2) of the Supreme Court Act, for the purposes of hearing and determining an appeal, the Supreme Court has all the powers, authority and jurisdiction of a Judge exercising the jurisdiction of the National Court.

25. We will exercise the powers in Sections 6(2), 16(c) and 16(d). We have all the evidence before us to determine how the respondents’ notice of motion, filed 11 January 2016, which led to dismissal of the proceedings, should be dealt with. We will allow the appeal, refuse all relief sought in that motion and remit the proceedings to the National Court. Costs will follow the event.

ORDER

(1) The appeal is allowed.

(2) The order of the National Court of 1 March 2016 in WS No 1717 of 2015 is quashed.

(3) The proceedings, WS No 1717 of 2015, are reinstated and, for the purposes of those proceedings, pursuant to Section 16(c) of the Supreme Court Act, all relief sought in the respondents’ notice of motion, filed 11 January 2016, is refused, and, pursuant to Section 16(d) of the Supreme Court Act, the case is remitted to the National Court for further conduct of those proceedings.

(4) The respondents shall pay the appellant’s costs of the appeal on a party-party basis, which shall, if not agreed, be taxed.

Judgment accordingly,

_______________________________________________

Apo &Co Lawyers: Lawyers for the appellant
Greg Manda Lawyers: Lawyers for the respondents