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Walker v Total Cleaning Services Ltd [2020] PGSC 14; SC1924 (28 February 2020)

SC1924

PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]


SCA NO. 153 OF2014


GREG WALKER
First Appellant


BARRICK (PNG) LIMITED
Second Appellant


PORGERA WOMENS ASSOCIATION INC.
Third Appellant


V


TOTAL CLEANING SERVICES LIMITED
Respondent


Waigani: Batari, David and Kariko, JJ
2019: 28th October
2020: 28th February


PRACTICE AND PROCEDURE –interim mandatory injunction –applicable principles –not available when act to be restrained already occurred – notice of motion must be for interlocutory orders only – grant of relief not applied for nor addressed by parties - grant of injunction adversely affecting a non-party – breach of natural justice


Cases Cited:


Chief Collector of Taxes v Bougainville Copper Ltd (2007) SC853
Gogl Naru Resource Owners Association Inc v Jant Ltd (2011) N4472
Leytrac Pty Ltd v State [1982] PNGLR 148
Maginde v The State (2016) SC1521
Mataio v August (2014) SC1361
Mediang v Ramu Nico Management (MCC)Ltd (2011) SC 1144
NCDC v Central Provincial Government (2015) SC1429
NCDC v Yama Security Services Pty Ltd (2003) SC707
William Duma v. Eric Meier (2007) SC898
Yama Group of Companies Ltd v PNG Power Ltd (2005) N2831
PNG Deep Fishing Ltd v Luke Critten & Ors (2010) SC 1126


Legislation:


ADR Rules
National Court Act Ch.38
National Court Rules


Counsel:


Mr R Bradshaw, for the First and Second Appellants
Mr G Goiye, for the Third Appellant
Mr P Kak, for the Respondent


JUDGMENT


28th February, 2020


  1. BY THE COURT: Pursuant to the grant of leave, two separate appeals were filed challenging interlocutory orders granted by the National Court at Waigani on 3rd December 2014. The first and second appellants filed the first appeal while the third appellant filed the other.
  2. Both appeals were heard together.

Background


  1. The relevant background facts giving rise to the National Court proceedings are not in dispute.
  2. The second appellant (Barrick) is the operator of the Porgera Gold Mine (the Mine) in Enga Province, and as is the case with other operators of major investments in this country, spin-off benefits and businesses are offered to local landowners as first-priority. This is consistent with general government policy and under relevant agreements including the Mining Development Contract entered into between Barrick and the State.
  3. The first appellant is the Executive General Manager of Barrick at the Mine.
  4. The respondent (Total Cleaning) is a local landowner company.
  5. Total Cleaning known previously under two different names commenced providing janitorial and cleaning services (the Services) at the Mine site in 1989.
  6. On 31st July 2005, Barrick and Total Cleaning entered into a contract (the Contract) for Total Cleaning to provide the Services for a term of 3 years.
  7. Upon the expiration of the term on 31st July 2008, Total Cleaning’s engagement continued on a month- to-month basis.
  8. On 20th May 2013, Barrick invited tenders for the provision of the Services and Total Cleaning responded with a bid.
  9. By letter dated 5th May 2014, Barrick advised the respondent that it had decided not to accept any of the bids submitted under the tender process and instead it would manage the Services “in-house”.
  10. By letter dated 13th October 2014 to Total Cleaning, Barrick gave notice of termination of the Services provided by the respondent effective 28th November 2014. This was notwithstanding Barrick’s acknowledgement that Total Cleaning had performed the Services satisfactorily.
  11. In the meantime, Total Cleaning lobbied local support for it to continue providing the Services. Letters of support were received from landowner groups including the Porgera Landowners Association, and some community leaders.
  12. On 16th November 2014, Barrick and the third appellant (Porgera Women’s Association) entered into a Memorandum of Understanding for the Association to provide the Services.
  13. The employment of Porgera Women’s Association prompted Total Cleaning to file proceedings WS No. 1472 of 2014– Total Cleaning & House Keeping Services Limited v Greg Walker and Barrick (Niugini) Limited on 26th November 2014.
  14. In its Statement of Claim, Total Cleaning seeks a number of relief including:
  15. On filing its Writ, Total Cleaning also filed a notice of motion principally seeking:
  16. Prior to the hearing of the applications, Total Cleaning ceased providing the Services on 28th November 2014, while Porgera Women’s Association commenced its engagement the next day.
  17. The notice of motion was heard on 3rd December 2014 and determined in favour of Total Cleaning.

Appealed decision


  1. In reaching his decision, the learned trial Judge firstly referred to the general government policy that local landowners shall be given priority in the award of spin-off businesses relating to major investment projects. His Honour viewed the termination of Total Cleaning’s engagement as contrary to the intent of that policy, and he noted that Barrick’s decision was against the strong support given by other landowners including the Porgera Landowners Association for Total Cleaning to continue providing the Services.
  2. His Honour then mentioned Bougainville and the crisis that followed government’s failure to properly address landowners concerns in respect of the mine there, before he remarked:

“Terminating a landowner company successfully providing a service just because the company wants to make a change for what it calls an economic decision, spells the risk of all infrastructure going down, government resources being stretched to the limit.” (Our emphasis)


  1. The trial Judge forecasted that the actions of Barrick would lead to civil unrest and lawlessness similar to what occurred in Bougainville, and considered that damage as a result of such unrest would be significantly greater than the damages that may be suffered by Barrick and the Porgera Womens’ Association if the injunction was not granted. He was therefore inclined to issue the injunction sought.
  2. His Honour also considered the contract Barrick had with Total Cleaning as “... not just an ordinary contract; it ties in with government policy, it ties in with a greater agreement that it is a part of. So, in order for a change in a subsidiary agreement such as this, the main basis on which the subsidiary is dependent must be changed not unilaterally but by mutual agreement of the parties.” (Our emphasis)
  3. This led his Honour to conclude that the Contract could only be changed after a review of the relevant heads of agreement concerning the operations of the Mine (the Mining Review), which review was then pending.

The appealed orders


  1. The Minute of the orders filed by the respondent states:
    1. The Plaintiff is granted injunction orders against the Defendants;
    2. Unless the Defendant is able to cause the calling of a Mining Review within this month, the substantive matter shall go for mediation;
    3. Pro-forma mediation orders can be obtained from the ADR Centre and completed before the return of this matter;
    4. Matter returns on 19/12/14;
    5. Time is abridged.
  2. The full terms of the orders, confirmed by the transcript of proceedings, read:
    1. Interim injunction granted to restrain the defendants from giving effect to its decision to terminate the plaintiff company in the provision of the services they were providing.
    2. The defendants to take every step to ensure that the mining review takes place and addresses, amongst others, this particular matter before the end of the month.
    3. If by or before 19th December, no meaningful step is taken to have the mining review conducted and completed before the end of the month, then parties shall return to court on the 19th for mediation orders to be issued for mediation to take place in the New Year 2015.
    4. For the purpose of any mediation order, parties shall take hold of the pro-forma orders presently being used by the ADR services for parties to complete before returning to the court for its endorsement.
    5. Abridgement of time to take place upon signing of the orders.

Grounds of Appeal


  1. The grounds of appeal filed by the first and second appellants state:

(ii) the Respondent’s application (for the injunctions) was effectively an application for summary judgment for the injunctions;

(iii) this was not an appropriate case of summary judgment.

(c) The Learned Judge erred in law and fact in granting the injunctions, which are mandatory injunctions, when the principles for the grant of mandatory injunctions set out in case authorities such as Yama Group of Companies Ltd v PNG Power Ltd (2005) N2831 had not been satisfied.
(d) The Learned Judged erred in law and fact in granting the order that Appellant’s letter of termination of 13th October 2014 be stayed when:

(ii) the Second Appellant was entitled, at law, to terminate the Respondent’s engagement;

(iii) the Second Appellant had terminated the Respondent’s engagement by giving notice (of termination) to the Respondent on 13th October 2014;
(iv) termination of the Respondent’s engagement became effective on 28th November 2014;
(v) the Second Appellant had engaged another service provider, the Porgera District Women’s Association to provide the services;
(vi) stay of termination of the Respondent’s engagement has resulted in termination of the engagement of the Porgera District Womens’ Association to provide the services.
(e) The Learned Judge erred in law in granting the injunctions when no or no proper Undertaking as to Damages had been filed by the Respondent.
(f) The Learned Judge erred in law and fact by considering irrelevant matters, particularly matters not in issue or in evidence before the Court (such as alleged facts concerning the Bougainville crisis).
(g) The Learned Judge erred in law in making order that the Appellant cause the calling of a Mining Review when:

(ii) whether there should be a Mining Review was not a matter in issue or in dispute before the Court for determination;

(iii) the Appellant was not given any opportunity to be heard on the question or issue of whether it should cause a Mining Review to be held;

(iv) there was no evidence or other material before the Court to justify the making of such order.

(h) The Learned Judge erred in law in ordering that if the Defendant is unable to cause the calling of a Mining Review, the substantive matter shall go for mediation when:

(ii) the Appellant was not given any opportunity to be heard on the question whether the matter should be referred to mediation.


  1. The grounds of appeal pleaded by the third appellant are:

(a) The Learned Judge erred in law and fact in granting the injunction when the acts subject of the injunction had already occurred in particular when the:

(i) Respondent’s engagement to provide the cleaning services to the Second Appellant was terminated as at 28th November 2014;

(ii) Second Appellant had awarded the cleaning contract to the Third Appellant;

(iii) Third Appellant had already commenced work on the locations at the Porgera Mine Site approved by the Second Appellant; and

(iv) Injunction resulted in substantial prejudice to the Third Appellant.

(b) After it was brought to the Learned Judge’s attention that the Third Appellant had a significant interest in the proceedings, the Learned Judge erred in law in not giving the Third Appellant an opportunity to be heard on the Respondent’s application for injunctive relief.

(c) The Learned Judge erred in law in making and granting an order that:

(i) forced the Second Appellant to create a new contract relationship with the Respondent (where there was none);

(ii) interfered with the Second Appellant’s existing contractual relationship with the Third Appellant (when neither party sought the Court to interfere with the contractual relationship);

(iii) allowed third party to interfere with an existing contractual relationship in breach of the principle of privity of contract.

(d) The Learned Judge erred in law and fact when granting the injunction which is mandatory in nature in circumstances where the requirements of such injunction had not been satisfied.

(e) The Learned Judge erred in law and fact in ordering that Unless the Defendant is able to cause the calling of a Mining Review within this month shall go for mediation when:

(i) the Respondent or the First and Second Appellants did not seek such a relief in the pleadings;

(ii) the parties were not afforded any opportunity to be heard on the issue whether the matter should be referred to mediation.


  1. We note that both appeals raise similar grounds, which we summarize as follows:

Consideration


  1. We will consider the appeal in the order of the digested grounds of appeal.
  2. In answering the grounds of appeal, the respondent basically urged the Court to consider the totality of the evidence and in particular the facts that:
  3. In essence, the respondent argued that the trial Judge properly took into account these considerations in exercising his discretion and granted orders that were appropriate in the circumstances.

Ground (1)(a)


  1. An injunction cannot be ordered to restrain an act that has already occurred: Leytrac Pty Ltd v State [1982] PNGLR 148.
  2. The interim injunction in discussion was directed to stop Barrick from terminating the Services being provided by the respondent. As noted earlier, the termination came into effect on 28th November 2014, which was 5 days before the injunction was ordered. The trial Judge acknowledged these facts but decided nevertheless to grant the injunction based on irrelevant considerations which we will address later.
  3. Applying the statement in Leytrac Pty Ltd v State, it is clear the trial Judge erred in law, and we consider this error sufficient to uphold the appeal and set aside the appealed orders.
  4. Notwithstanding that, we will proceed to consider the other grounds of appeal.

Ground (1)(b)


  1. Order 4 rule 49(9) National Court Rules provides that “Motions shall be for relief on interlocutory matters only and not for the substantive relief claimed in the originating process.”.
  2. A notice of motion which seeks very similar or the same as the substantive relief sought, is incompetent as it amounts to an abuse of process; NCDC v Yama Security Services Pty Ltd (2003) SC707, William Duma v. Eric Meier (2007) SC898.
  3. A principle relief sought in the Statement of Claim includes a permanent injunction against the termination of the respondent’s engagement by Barrick effective 28th November 2014. Essentially the same relief was sought in the notice of motion and granted.
  4. With respect, we find the trial Judge erred in law by acting contrary to O4 r49(9), and this ground of appeal is also upheld.

Ground (1)(c)


  1. The interim injunction granted is mandatory in nature as it restrains Barrick from implementing its decision to terminate the Services provided by Total Cleaning.
  2. An instructive discussion and summary of the applicable principles in respect of mandatory injunctions is found in Yama Group of Companies Ltd v PNG Power Ltd (2005) N2831. These principles relevantly include:

“The general principles for negative injunctions apply, that is that there is a serious case to be tried, damages are not an adequate remedy and the balance of convenience favours the applicant, but the case should normally be one giving an unusually strong and clear view that the applicant will be successful at trial.(Emphasis added)


  1. It is settled law that an applicant seeking an interim injunction must show that:

(Chief Collector of Taxes v Bougainville Copper Ltd (2007) SC853)


  1. In our view, the trial Judge did not properly apply these principles in reaching his decision. As noted earlier, his Honour was overly engrossed with the belief that civil unrest and lawlessness would follow the termination of the respondent’s engagement by Barrick. His Honour’s belief appears to have been greatly influenced by “popular support” given to Total Cleaning by other landowners. Otherwise, there was no evidentiary basis for his Honour to find there was real risk of civil unrest and lawlessness. The affidavit evidence of the “popular support” did not suggest the threat was likely.
  2. In stating that the trial Judge did not properly address the applicable principles, we mention the matter of an undertaking as to damages as an example. It is mandatory to give such an undertaking; Chief Collector of Taxes v Bougainville Copper Ltd (supra). Case authorities suggest that where an undertaking is by a company, it must be given under seal and signed by appropriate officers; Gogl Naru Resource Owners Association Inc v Jant Ltd (2011) N4472, PNG Deep Fishing Ltd v Luke Critten & Ors (2010) SC 1126. No proper undertaking was filed in the present case, as it was not signed under the respondent’s company seal. This consideration was seemingly overlooked by the trial Judge.
  3. It is plain to us that, except may be on the question of damages, his Honour did not properly direct his mind to the applicable principles for the grant of an interim injunction or for that matter, a mandatory injunction. Instead, his Honour seemed overwhelmed by irrelevant matters that had no evidentiary foundation. In doing so, his Honour erred in law and in fact, and this ground of appeal must be allowed.

Ground (2)


  1. Apart from granting the interim injunction, the trial Judge also ordered Barrick to cause the Mining Review to take place within a month, failing which mediation was to be held to determine the dispute between the parties. These orders were not sought nor did the learned trial Judge invite parties to address him on these orders if he was contemplating making them. Such practice has been viewed as a breach of the principles of natural justice; Mataio v August (2014) SC1361, Maginde v The State (2016) SC1521.
  2. We endorse the following statement by the Court in Mediang v Ramu Nico Management (MCC) Ltd (2011) SC 1144 at [150] relied upon by counsel for the appellants:

“All parties are entitled to the dispensation of justice by the courts. To make orders that are not sought, without giving a party, especially a party that will be adversely affected by such orders the opportunity to be heard in respect of such orders, is not in our view, a proper dispensation of justice.” (Emphasis added)


  1. In NCDC v Central Provincial Government (2015) SC1429, the Court considered the statement equally applicable in judicial review proceedings, to a statement or notice of motion under O16 r5 National Court Rules. We are of the opinion that the statement necessarily applies also to other notices of motion.
  2. In any case, we note that while the evidence contains some mention of the Mining Review, the evidence lacks details, for example, as to when this would be held, the process involved, the facilitator, the participants, and the agenda. There was certainly no evidence that Barrick was obliged to organize the Review. Rather, counsel for the respondent indicated that the responsibility lay with the State; (Appeal Book, 133:10)
  3. We think it reasonable to expect the State’s key Departments such as Mining, Justice and Finance, and undoubtedly the Enga Provincial Government and the landowners of the Mine site, to be the main participants in the Review. The point we make is that the order relating to the Mining Review was issued in the absence of all affected parties to the Review and without them being heard. In line with the propositions held in the case authorities cited in [47] and [48] above, we deem a breach of natural justice occurred.
  4. Further, we note that while s.7 National Court Act Ch.38 and r.5(2)ADR Rules permits the National Court, on its own motion, to refer a dispute to mediation, this does not obviate the requirement to put the proposed referral to parties first, so they may be heard on the matter.
  5. The upshot is that we also uphold this ground of appeal.

Ground (3)


  1. It was not in dispute as between the parties that the Porgera Womens Association is a relevant party to the dispute. Its membership comprises women of Porgera and it replaced the respondent in providing the Services, assuming that responsibility 4 days before the hearing of the respondent’s notice of motion. The trial Judge was informed of this and a plea was made by counsel for Barrick to have the Association joined as a party, as an injunction would adversely affect it; (Appeal Book, 132:3-8)
  2. His Honour did not address this application, but in discussing the question of damages, he remarked:

“If there have been changes as is being suggested that handover/takeover is completed, that would be very minimal. That can be reversed as against the greater risks I have outlined before coming to this decision.


And if indeed those are Porgera Womens’ Association, they would be understanding of the arrangements that are in place, that could work out quite well and I do not consider for once that any damage or harm done to the incoming would be any greater than the greater risks that I spoke of poses; unless I intervene by way of a grant of injunction.”


  1. It is clear that his Honour recognized the Association would suffer damages as a result of an injunction. In the circumstances, his Honour was obliged to at least consider the joinder. In not considering the proposed joinder, his Honour fell into error.

Conclusion


  1. For all the foregoing reasons, we would allow the appeal with costs for the appellants and remit the matter to the National Court.
  2. The third appellant was granted leave to join this appeal for the obvious reasons that it has sufficient interest in the dispute and its inclusion would help resolve the issues involved. Based on those factors, we would also allow Porgera Women’s Association to be added as a defendant in the National Court proceedings.

Order


  1. This Court orders that:

________________________________________________________________Bradshaw Lawyers: Lawyers for the First and Second Appellants
Gileng Goiye Lawyers: Lawyers for the Third Appellant
Peter K Pim Lawyers: Lawyers for the Respondent


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