|
|
Home
| Databases
| WorldLII
| Search
| Feedback
Supreme Court of Papua New Guinea |
PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]
SCA NO. 83 OF 2019
SUNSET RENTALS LIMITED
Appellant
V
PACIFIC VIEW APARTMENTS LIMITED
Respondent
Waigani: Cannings J, Polume-Kiele J and Anis J
2020: 28th July, 4th September
SUBSTANTIVE APPEAL – whether there were evidence presented before the trial Court that showed that the debtor was unable to pay its debts as they fell due in the ordinary course of business – s. 291(3) – Companies Act 1997 – whether there were also other evidence that were before the trial Court that showed the inability of the appellant to pay its debits – whether it was also established that was just and equitable that the Company be wound-up
PRACTICE AND PROCEDURES – petition grounds – s. 291(3)(a),(b),(c) and (d) – Companies Act – whether all or only one ground is sufficient or required by law, where if established, should or may permit the Court to order liquidation
PRACTICE AND PROCEDURES - solvency test – s. 4 – Companies Act – whether s. 4 is a material requirement or consideration in relation to petitions that are filed under s. 291(3) – legislators’ intention concerning s. 291(3) and s. 4 of the Companies Act
PRACTICE AND PROCEDURES – company as a legal person – s. 16 – Companies Act – distinction between a shareholder’s interest in a company and a company as a separate legal person discussed – limits to the role of an Administrator of an estate of a deceased whose shares are held in the company
PRACTICE AND PROCEDURES – share a personal property – section 36 considered – Companies Act
Cased Cited:
Gawan Kuyan v. Andrew Sallel; Andrew Sallel v. Gawan Kuyan (2008) N3376
Pacific Rim Constructors-Singapore Pte Ltd v Huala Hire & Construction Ltd (2012) N4710
Investment Corporation of Papua New Guinea v. Paul Pora and the State [1993] PNGLR 45
Chief Collector of Taxes v. Bougainville Copper Ltd (2007) SC853
Tomscoll v. State (2012) SC1208
Fly River Provincial Government v. Pioneer Health Services Limited (2003) SC705
Ken Fairweather v. Jerry Singirok [2013] 2 PNGLR 95
Counsel:
Ms A Kimbu, for the Appellant
Mr S Gor, for the Respondent
4th September, 2020
1. BY THE COURT: The substantive appeal was heard on 28 July 2020. We reserved after the hearing on that day. We now give our decision.
BACKGROUND
2. The appellant owns or is a registered sub-lessee of 2 units, namely, units 902 and 904 at the Pacific View Apartments (Pacific View Apartments) which is situated at 2 Mile Port Moresby. The late Dr Florian Gubon was the sole shareholder of the appellant. He and his wife Mrs Gubon (the Gubons) also jointly own an apartment at Pacific View Apartments called Apartment No. 804. Dr Gubon passed on, on 24 April 2016.
3. The respondent is a body corporate that manages Pacific View Apartments. Unit holders in Pacific View Apartments are also shareholders of the respondent. The Gubons were joint shareholders of the respondent, and with the demise of Dr Gubon, Mrs Gubon appears to remain as the sole shareholder for their shares held in the respondent. Under the constitution of the respondent, each unit owner of Pacific View Apartments shall pay monthly body corporate levy fees to the respondent for its upkeep and management. Services that the respondent provide, include water, electricity, security, elevator access and service, and use of amenities. In 2018, the respondent alleged that the appellant and the Gubons had failed to pay their levy fees for the 3 units which it alleged had accumulated. The respondent filed 2 separate proceedings against the appellant and the Gubons. The respondent sued the appellant in proceeding WS No. 7 of 2017 and the Gubons in proceeding WS No. 8 of 2017. On 19 February 2018, the National Court awarded default judgment in the sum of K44,741.83 in favour of the respondent and against the appellant. Earlier on, on 14 February 2018, the National Court also awarded a sum of K31,752.83 in favour of the respondent and against the Gubons. The debts remained unsettled in full so on 8 September 2018, the respondent filed a petition described as MP 27 of 2018 (the petition) in the National Court, to liquidate the appellant in relation to its outstanding judgment sum of K44,741.83.
4. On 13 June 2019, Justice David (the trial Judge/Court) conducted a hearing of the petition. His Honour granted the petition and ordered that the appellant be put into liquidation. A copy of the National Court Order is at page 13 of the 2 volumes of the Appeal Book (AB). It reads in part:
GROUNDS OF APPEAL
5. The Notice of Appeal (NoA) was filed on 2 July 2020. There are 8 grounds of appeal. We set them out in part as follows:
3.1 The learned trial judge erred in law in granting the Application for Liquidation and placing the Appellant company, Sunset Rentals Limited into Liquidation and further appointing Mr. David Guinn as the Liquidator taking effect as at the date of the judgment when the two (2) tests for insolvency under the Companies Act 1997 were never fully satisfied;
3.2 The learned trial judge erred in law in granting the Application for Liquidation and placing the Appellant company, Sunset Rentals Limited into Liquidation and further appointing Mr. David Guinn as the Liquidator taking effect as at the date of the judgment when the Debtor Company was able to meet its debt and that any delay in the payment of the debt owing was based on consensus reached between parties (Applicant/Debtor Company on the one end and Respondent/Petitioner on the other) to allow the ruling on the Application for Letters of Administration in the related National Court proceeding WPA NO. 38 OF 2016: In the Estate of Dr Florian Gubon, Late of Lido Village, Sandaun Province, Papua New Guinea, Lawyer, Deceased, Intestate to be delivered.
3.3 The learned trial judge erred in law in granting the Application for Liquidation and placing the Appellant company, Sunset Rentals Limited into Liquidation and further appointing Mr. David Guinn as the Liquidator taking effect as at the date of the judgment when the Debtor Company’s liabilities did not out value its asserts or rather the value of the Debtor company far outweighed the liabilities and/or the amount due and owing to the Respondent (Petitioner).
3.4 The learned trial judge erred in law in granting the Application for Liquidation and placing the Appellant company, Sunset Rentals Limited into Liquidation and further appointing Mr. David Guinn as the Liquidator taking effect as at the date of the judgment when the Debtor Company’s liabilities did not out value its asserts or rather the value of the Debtor company far outweighed the liabilities and/or the amount due and owing and that in the event His Honour required evidence to confirm same, that the appropriate order to have been made under the circumstance was to order parties to engage an independent Certified Valuation company to actually proof the total value of the Debtor Company and the properties registered under it before making the substantive orders of 13th June 2019.
3.5 The learned trial judge erred in law in granting the Application for Liquidation and placing the Appellant company, Sunset Rentals Limited into Liquidation and further appointing Mr. David Guinn as the Liquidator taking effect as at the date of the judgment when the Debtor Company, Sunset Rentals Limited and the two (2) properties registered under it described Unit 902, 9th Floor, Pacific View Apartment, 2 Mile Hill, NCD and Unite 904A, 9th Floor, Pacific View Apartment, 2 Mile Hill, NCD were listed as assets of the deceased, the Late Dr. Florian Gubon who is the sole Shareholder and Director of the Debtor Company, thereby forming part of the Estates of the deceased and hence, subject of the Court Orders of 12th February, 2019 and hence, the Respondent ought to have applied under the proceeding WPA NO.38 OF 2016 In the Estate of Dr Florian Gubon, Late of Lido Village, Sundaun Province, Papua New Guinea, Lawyer, Deceased Intestate to have the debtor Company/Applicant and the two (2) properties described removed from the list of inventories and to have the Court Order of 12th February, 2019 varied to have the debtor company and the described properties removed from being included in the estate of the Late Dr. Florian Gubon and subject of the Court Orders of 12th February, 2019 granting Mrs Sainimili Gubon Letters of Administration.
3.6 The learned trial judge erred in law in granting the Application for Liquidation and placing the Appellant company, Sunset Rentals Limited into Liquidation and further appointing Mr. David Guinn as the Liquidator taking effect as at the date of the judgment when the National Court of competent jurisdiction had already on 12th February, 2019 granted Letters of Administration to the wife of the sole shareholder and director of the Debtor Company, Late Dr. Florian Gubon and when an Administrator and a Liquidator perform more or less the same function except that a Liquidator is far more expensive as opposed to an Administrator and therefore, is at the detriment of the beneficiaries of the Estates of the Late Dr. Florian Gubon and as a result, the orders are unjust and unfair to the beneficiaries of the Estate of the Late Dr. Florian Gubon.
3.7 The learned trial judge erred in law in granting the Application for Liquidation and placing the Appellant company, Sunset Rentals Limited into Liquidation and further appointing Mr. David Guinn as the Liquidator taking effect as at the date of the judgment when Debtor Company, Sunset Rentals Limited was never served the Creditor’s Statutory Demand as claimed by the Respondent which is a requirement under section 337 of the Companies Act 1997.
3.8 The learned trial judge erred in law in refusing the Debtor Company’s application for adjournment to file further affidavit materials when the Application was necessary to file further affidavit materials to assist the Court arrive at a just ruling under the circumstance and that any further adjournment should have been compensated adequately by an order for costs.
PRELIMINARY CONSIDERATIONS: GROUNDS 3.4, 3.5, 3.7 & 3.8
6. We prefer to address grounds 3.4, 3.5, 3.7 and 3.8 at this juncture.
7. We refer to grounds 3.4 and 3.5. These grounds do not challenge the trial Judge’s decision in liquidating the appellant. Under ground 3.4, the appellant has proposed a relief which it claims the trial judge should have ordered. The so-called relief reads, and we quote in part, that the appropriate order to have been made under the circumstance was to order parties to engage an independent Certified Valuation company to actually proof the total value of the Debtor Company and the properties registered under it before making the substantive orders of 13th June 2019. The hearing of 13 June 2019 was the actual or substantive hearing of the petition. It was not a direction hearing or an interlocutory process whereby such interlocutory relief or considerations would have been contemplated. It was also not sought as a relief by the appellant as a crossclaim or as an alternative relief by the respondent, that it would have otherwise been available for consideration as an option by the trial Court. We find ground of appeal 3.4 baseless and dismiss it.
8. In relation to ground 3.5, we note this. The appellant is actually challenging the mode of the proceeding, and it says the correct process should have been and we quote in part, the Respondent ought to have applied under the proceeding WPA NO.38 OF 2016 In the Estate of Dr Florian Gubon. Again, this was a trial proper for the petition that had been filed by the respondent against the appellant. Ground 3.5 does not have a foundation in the pleadings that had been raised by the respondent in its petition. There was no application filed by the appellant that was also before the trial Court where such an issue had been raised for consideration by the trial Judge together with the substantive hearing. Secondly, the appellant appears to have this misconceived view that since the deceased Dr Gubon was the sole shareholder of the appellant, upon his death, that the appellant or the properties that it owns, would fall under or form part of the assets of his (i.e., late Dr Gubon’s) estate. Mr Gor, counsel for the respondent, brought the said misconception to our attention at the hearing of this appeal. We note that we received no meaningful or relevant response in reply from Ms Kimbu, counsel for the appellant. We uphold the respondent’s submission. Sections 16 and 36 of the Companies Act 1997 (the Companies Act) state:
16. Separate legal personality.
A company is a legal entity in its own right separate from its shareholders and continues in existence until it is removed from the register.
......
36. Legal nature of shares.
A share in a company is personal property.
9. Illustrative cases that explain a company as a legal person, its shares and powers, and the powers and functions of its directors and shareholders, include the following: Gawan Kuyan v. Andrew Sallel; Andrew Sallel v. Gawan Kuyan (2008) N3376, Pacific Rim Constructors—Singapore Pte Limited v Huala Hire & Construction Limited (2012) N4710; and Investment Corporation of Papua New Guinea v. Paul Pora and the State [1993] PNGLR 45. In Investment Corporation of Papua New Guinea (supra) for example, Justice Brown held, amongst others, and we quote:
10. Late Dr Gubon may have held shares in the appellant before his demise. Upon his death and based on the evidence adduced in the AB, his wife Mrs Gubon has been appointed to administer his estate. The deceased’s shares would ordinarily form part of his estate thus be at the care or disposal of his wife as its Administrator. However, the appellant company is a separate legal person and Mrs Gubon’s role as the Administrator would ordinarily be limited to the late Dr Gubon’s shares that are held in the appellant. It is misconceived to say that Mrs Gubon, as the Administrator or by her said appointment, entitles her to take charge over the affairs of the company. The appellant shall ordinarily be governed by its constitution or otherwise by the provisions of the Companies Act. Assets that are owned by the company would ordinarily belong to the company. To imply that the appellant company assets are to be regarded or treated as part of the assets of the estate of the late Dr Gubon is, in our view, misconceived. We dismiss ground of appeal 3.5.
11. We refer to ground 3.7. The appellant claims it was never served with the Creditor’s Statutory Demand that was said to have been posted to its address on 20 July 2018. We refer to the transcript of proceedings. We note that the appellant, at no point in time, raised or contested the issue of want of service of the Creditor’s Statutory Demand before the trial Court. This Court in Chief Collector of Taxes v. Bougainville Copper Ltd (2007) SC853, Tomscoll v. State (2012) SC1208 and Fly River Provincial Government v. Pioneer Health Services Limited (2003) SC705 has held that a party is not at liberty to raise a point of law that was not raised or put before the Court below. That said, there have been instances where this Court has entertained issues not raised in the Court below. The distinction with references to cases, is explained in the case of Ken Fairweather v. Jerry Singirok [2013] 2 PNGLR 95. This Court stated at paragraphs 34 and 35:
34. The strict approach says that a party can raise in the Supreme Court a point of law not put before the National Court, but only if it seeks and obtains the leave of the Supreme Court to do so, this being the approach taken in cases such as Van Der Kreek v Van Der Kreek [1979] PNGLR 185, The Papua Club Inc v Nusaum Holdings Ltd (2005) SC812, Application by Herman Joseph Leahy (2006) SC 855, Telikom PNG Ltd v ICCC (2008) SC906 and Comrade Trustee Services Ltd v Arnold Daugle (2011) SC1105.
35. The very strict approach is the one that says that under no circumstances can a party raise in the Supreme Court a point of law not put before the National Court, this being the approach taken in cases such as MVIT v James Pupune [1993] PNGLR 370, PNGBC v Jeff Tole (2002) SC694, Fly River Provincial Government v Pioneer Health Services Ltd (2003) SC705, Curtain Brothers (PNG) Ltd v University of Papua New Guinea (2005) SC788 and Chief Collector of Taxes v Bougainville Copper Ltd (2007) SC853.
12. Before we rule on this ground of appeal, we make this observation. The evidence and documents contained in the AB also show that attempts had been made by the appellant to dismiss the petition, and one of the intended reasons was for want of service of the Creditor’s Statutory Demand. The intended notice of motion which was filed on 30 October 2018 appeared to have been abandoned by the appellant. We say this because at the petition hearing, the appellant’s counsel said, and we quote in part from the transcript of proceedings:
MR KAUM: It was our intention to have this matter dismissed. Unfortunately, the utility of that application became redundant after certain events already happened.
13. Therefore, it also appears disingenuous, in our view, that the appellant would raise that as a ground of appeal before the Supreme Court. In conclusion, we dismiss ground of appeal 3.7.
14. In relation to ground 3.8, the appellant is appealing against the trial Judge’s decision in not granting its request for an adjournment. We have perused the transcript of proceedings in the AB. At page 42, lines 20 and 30, the appellant’s counsel indicated his intention to seek an adjournment. But that said, he did not make such an application, whether orally or otherwise, to the Court at any time during the hearing on 13 June 2019. The ground of appeal is not based on what had transpired in the Court below. As such, we find ground of appeal 3.8 not only baseless but also misleading, and we dismiss it.
ISSUES
15. The issues for determination in relation to grounds 3.1, 3.2, 3.3 and 3.6 are as follows:
(i) Whether the solvency test under s. 4 of the Companies Act is mandatory to ascertain whether a company is unable to pay its debts as they become due in the ordinary course of business as required under s.291(3)(a) of the Companies Act; (grounds 3.1 and 3.3)
(ii) Whether the appellant had disclosed evidence before the trial Court that it was able to pay its debts as they became due on the ordinary course of business, and if so, whether the trial judge erred in his findings; (ground 3.2)
(iii) Whether proceeding WPA NO. 38 OF 2016: In the Estate of Dr Florian Gubon, had any relevance to the proceeding the subject of this appeal. (grounds 3.6)
SOLVENCY TEST: GROUNDS 3.1 and 3.3
16. The appellant’s main argument under grounds 3.1 and 3.3 is this. It says it met the solvency test under s. 4 of the Companies Act and as such, the trial Judge erred when it proceeded to appoint the liquidator. Sections 4 and 291(3) read:
(1) For the purposes of this Act, a company satisfies the solvency test where—
(a) the company is able to pay its debts as they become due in the ordinary course of business; and
(b) the value of the company's assets is greater than the value of its liabilities, including contingent liabilities.
(2) Without limiting Sections 50 and 53(3), in determining for the purposes of this Act (other than Sections 234 and 235 which relate to amalgamations) whether the value of a company's assets is greater than the value of its liabilities, including contingent liabilities, the directors—
(a) shall have regard to—
(i) the most recent financial statements of the company that comply with Section 179; and
(ii) all other circumstances that the directors know or ought to know affect, or may affect, the value of the company's assets and the value of its liabilities, including its contingent liabilities; and
(b) may rely on valuations of assets or estimates of liabilities that are reasonable in the circumstances.
......
(3) The Court may appoint a liquidator where it is satisfied that—
(a) the company is unable to pay its debts as they become due in the ordinary course of business; or
(b) the company or the board has persistently or seriously failed to comply with this Act; or
(c) the company does not comply with Section 11; or
(d) it is just and equitable that the company be put into liquidation.
17. A solvency test is broadly applied under the Companies Act to ascertain whether a company is solvent, that is, by applying the 2 tests that are stated under s. 4(1)(a) and (b) of the Companies Act. However, s. 4 and the 2 tests are not expressly regarded as prerequisite requirements for purposes of liquidation of a company under s. 291(3). The minimum requirement for a Court that is hearing a petition to liquidate a company, is any one of those 4 grounds that are stated therein, namely, (i), the company is unable to pay its debts as they become due in the ordinary course of business, or (ii), the company or the board has persistently or seriously failed to comply with this Act, or (iii), the company does not comply with Section 11, or (iv), it is just and equitable that the company be put into liquidation.
18. We think it is prudent to follow the intention of the legislators and as such, that the Court should start at s. 291(3) to determine a petition rather than to begin at s. 4 or to use s. 4 as the material test when it is faced with an application to liquidate a company that is made under s. 291(3) of the Companies Act. For example, s. 291(3)(a)’s requirement does not require a petitioner to also adduce evidence to prove that the value of the company's assets is greater than the value of its liabilities, including contingent liabilities. The said requirement under s. 4 is bestowed on the directors of a company. If a creditor pleads ground (a) under s. 291(3), all that is required of it is evidence of want of compliance with a Creditor’s Statutory Demand or other evidence apart from that, to show that the debtor company is unable to pay its debts as they fall due in the ordinary course of business. Section 291(3)(a) also does not deter the Court from ordering liquidation even if there is evidence that shows that the value of the debtor company’s assets exceeds its liabilities. We therefore dismiss grounds of appeal 3.1 and 3.3.
INABILITY TO PAY DEBTS – GROUND 3.2
19. Ground 3.2 is in 2 folds. The appellant firstly claims that it was able to pay its debts at the material time. It also claims that any delay in payment was based on an understanding that it had had with the respondent that they would await the final decision of the Court in relation to proceeding WPA NO. 38 OF 2016: In the Estate of Dr Florian Gubon, that is, the Court’s decision to appoint an Administrator to administer the estate of the late Dr Gubon.
20. We begin by looking at the grounds in the petition. The respondent had pleaded and had relied on all the 4 grounds under which a petition may be brought under s. 291(3) of the Companies Act. The petition grounds read:
21. We next refer to the transcript of proceedings and the evidence that had been adduced before the trial Court, in the AB. There were, in our view, ample evidence adduced as well as admissions given by the appellant and its counsel before the trial Court, that the appellant was unable to pay its debts. For example, at line 20 at page 36 of the AB, the trial Judge and counsel for the appellant said as follows:
HIS HONOUR: Well, one of the grounds to appoint a liquidator is that the company-the debtor is unable to – the debtor company is unable to pay its debts as they become due in the ordinary course of the business so you do not dispute that.
MR KAUM: No, your Honour.
22. We also note that since we have dismissed ground of appeal 3.7, it means that the evidence of want of compliance with the Creditor’s Statutory Demand remains intact. We next refer to the evidence that had been deposed to by Mrs Gubon. She does not deny that the appellant as well as the Gubons owe monies to the respondent. We also refer to the respondent’s affidavits in support by Ofelia Carlos filed on 5 September 2018 (page 71 in the AB) and 2 April 2019 (page 315 of the AB). They show other evidence (apart from the Creditor’s Statutory Demand) of the appellant’s inability to pay its debts. A notable evidence is where it was revealed that the appellant as of 13 July 2016 had a balance of K150 in its bank account. And the debt which the respondent was after against the appellant, consisted of the judgment sum of K44,742.83 that had been awarded by the National Court in proceeding WS No. 7 of 2017. The Court ordered the appellant to pay the respondent the said amount on 19 February 2018. We refer to Mrs Gubon’s own affidavit filed on 30 October 2018 (page 213 of the AB). At annexure K2 and at page 292 of the AB, is a letter by the respondent’s lawyers dated 23 March 2018. In that letter, the respondent attaches sealed copies of the 2 Court orders including the one that required the appellant to pay the sum of K44,742.83. The debt remained unsettled as of 13 June 2019 when the Court ordered the appellant to be put into liquidation. Mrs Gubon provided evidence of 2 payments that had been made. Evidence of that is not disputed. Ms Carlos in her affidavit of 2 April 2019 (page 315 of the AB) confirms receipt of the payments. The first was for a sum of K10,000 and it was made on 4 September 2018. The second payment was for a sum of K28,000 and it was made on 13 November 2018. We will pause for a moment and make a remark here that these payments appear to have been made contrary to part of the allegations that are made by the appellant under this ground of appeal, which is that there was an understanding between the parties to delay further payments until after the appointment of the Administrator of the estate of the late Dr Gubon.
23. Ms Carlos also deposes at paragraphs 10, 11 and 12, of her affidavit of 2 April 2019, that the corporate levy charges for the 2 units held by the appellant continue to accumulate or accrue. She states, and we quote:
(i) For Apartment 902 – K80,917.42;
(ii) For Apartment 904 – K35,616.00.
(a) K10,000.00 paid on 4 September 2018; and
(b) K28,000.00 paid on 13 November 2018.
(i) Apartment 902 – K60,306.12; and
(ii) Apartment 904 – K43,674.65
24. The trial Judge in summary held that there was sufficient evidence that established grounds (i) and (iv) of the petition. The trial Judge also held, in our view, correctly that the Court only had to be satisfied of one of the grounds under s. 291(3) of the Companies Act to exercise its power to appoint a liquidator. For clarity, section 291(3) is in express terms. A petitioner is required to establish any one of the 4 requirements stipulated under ss. (3)(a), (b), (c) or (d) before the Court may grant a petition to liquidate a company. In the present case, the trial Judge was satisfied of not 1 but 2 grounds, namely, (i), the appellant was unable to pay its debts as they fell due in the ordinary course of business and (ii), that it was just and equitable that the appellant be put into liquidation.
25. In regard to the second leg of argument concerning ground 3.2 of the appeal, which is that there had been a general understanding between the parties to postpone the payment arrangements or schedule until after the outcome of proceeding WPA NO. 38 OF 2016, we say these. Firstly, no proper evidence was adduced by counsel for the appellant before the trial Court on the matter. Secondly, had that been an issue, it should have been raised following due process. For example, appellant should have applied to set-aside the Creditor’s Statutory Demand and raised the said argument. Thirdly, we note that it was not an issue that was before the trial Court for determination. The appellant at the National Court was responding to the petition; its role or response was to adduce evidence to disprove the 4 grounds as had been pleaded in the petition; its role was not to create assertions or make fresh allegations that were not before the Court. We also note that the argument appears contrary to the facts of the matter. We firstly note that Mrs Gubon’s appointment as the Administrator occurred 4 months earlier on 12 February 2019, that is, ahead of the liquidation order which was made on 13 June 2019. So, if there was such an understanding in place to delay the payment, then the debt of K44,742.83 should have been settled soon after 12 February 2019. However, that did not occur. The said debt continued and remained outstanding together with additional accruals as of 13 June 2019 when the liquidation orders were made. And the respondent had provided evidence of these before the trial Court. The second inconsistency is captured in our remark above. The appellant, contrary to the said understanding, made 2 part-payments of the debts to the respondent.
26. For these reasons, we dismiss ground 3.2.
PROCEEDING WPA NO. 38 OF 2016 – GROUND 3.6
27. We turn to the final issue. The appellant argues at ground 3.6 that Mrs Gubon’s appointment as the Administrator of the estate of her late husband Dr Gubon, was first in time or ahead of the Court’s appointment of the liquidator. As such, she argues that that was sufficient, that is, for purposes of also managing the appellant. The appellant also submits that the Court’s Order of 13 June 2019 was unfair or unjust because the liquidator’s expenses were much more expensive and detrimental to the estate of the late Dr Gubon; that Mrs Gubon’s role as the Administrator was less expensive and sufficient to manage the appellant.
28. We dismiss these arguments. They have no legal foundation whatsoever and are misconceived. Counsel has not assisted the Court by drawing our attention to the connection or the law that states that an Administrator of an estate of a former shareholder of a company, shall or is entitled by law to take charge of that company on that basis of his or her appointment as the Administrator of the estate of the said former shareholder. We refer to what we have stated above in our judgment concerning a company as a legal person. And we will say this in conclusion. The appellant, under law, is a separate legal entity. It is established under the Companies Act and is governed by its provisions. The Administrator’s role, by her appointment, is limited to the estate of the late Dr Gubon including the shares that he once held in the appellant. Her powers and functions are provided for under provisions of the Wills Probate and Administration Act Chapter No. 291.
29. For these reasons, we dismiss ground 3.6.
SUMMARY
30. Given the above, this appeal shall fail.
COST
31. Cost order is discretionary. In this case, we will order cost to follow the event which will be assessed on a party/party basis to be taxed if not agreed.
ORDERS
32. We make the following orders:
(i) the Supreme Court Stay Order of 1 August 2019 is dissolved; and
(ii) the National Court Order of 13 June 2019 in proceeding MP No. 27 of 2018, is restored and takes immediate effect.
____________________________________________________________
Kimbu & Associates: Lawyers for the Appellant
Fiocco & Nutley: Lawyers for the Respondent
PacLII:
Copyright Policy
|
Disclaimers
|
Privacy Policy
|
Feedback
URL: http://www.paclii.org/pg/cases/PGSC/2020/75.html