Komkaeli Holdings Ltd v Wamp [2022] PGSC 122; SC2322 (28 November 2022)

SC2322

PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]

SCA NO. 102 OF 2022

KOMKAELI HOLDINGS LIMITED
First Appellant

STEVEN PUP
Second Appellant

V

PATE WAMP
First Respondent

CANOPUS NO 101 LIMITED
Second Respondent

MELPA PROPERTIES LIMITED
Third Respondent

PAUL TIMBI
Fourth Respondent

NATHAN WANTEPE
Fifth Respondent

Waigani: Cannings, Manuhu, Kariko, JJ
2022: 24^th & 28^th November

PRACTICE AND PROCEDURE – objection to competency of appeal – whether grounds of appeal raised questions of fact for which leave of the Court was required – whether grounds of appeal met requirements of Supreme Court Rules, Order 7 rule 9(c) and 10.

The first respondent filed a notice of objection to competency of an appeal. The appeal is against a final order of the National Court, which upheld a petition by the first respondent, an aggrieved shareholder of the second respondent, under s152 of the Companies Act and amongst other things awarded him K3 million compensation. The appeal raised 19 grounds of appeal. The primary grounds of objection were that most grounds of appeal involve questions of fact for which leave to appeal has not been granted contrary to the Supreme Court Act and/or fail to comply with Order 7 rules 9(c) and 10 of the Supreme Court Rules as they are unclear, fail to say why the trial judge was wrong and what the judge ought to have found, made statements without identifying the alleged error of the trial judge or made submissions and general statements that are submissions, not grounds of appeal.

Held:

(1) A ground of appeal that raises a question of fact only, as distinct from mixed fact and law, is only valid if leave of the Court has been granted under s 14(1)(c) of the Supreme Court Act.

(2) Order 7, Rules 9(c) and 10 of the Supreme Court Rules impose three requirements for a ground of appeal: (a) the ground must be stated briefly, but specifically (ie the ground must make grammatical and legal sense and be intelligible); (b) if it is alleged that a judgment is against the evidence or the weight of the evidence, the notice must specify with particularity the ground relied on to demonstrate that it is against the evidence or the weight of the evidence; (c) if it is alleged that the judgment is wrong in law, the notice must specify with particularity the ground relied on to demonstrate the specific reasons why the judgment is alleged to be wrong in law.

(3) An objection to competency must demonstrate that all grounds of appeal are invalid. If one ground of appeal is valid, the appeal is competent and the objection fails.

(4) An examination of the first ground of appeal, which was challenged on the ground that it was raising questions of fact without leave, reveals that it is raising questions of mixed fact and law, which does not require leave. No good reasons were provided for regarding the first ground of appeal as invalid. It is deemed to be valid.

(5) Therefore, the appeal is competent and the objection to competency is refused, with costs.

Cases Cited:
Papua New Guinean Cases

Coca Cola Amatil (PNG) Ltd v Kennedy [2012] 2 PNGLR 205
Dillingham Corporation of New Guinea Pty Ltd v Diaz [1975] PNGLR 262
Haiveta v Wingti (No 2) [1994] PNGLR 189
In the matter of Canopus No 101 Ltd (2022) N9651
Ipili Porgera Investments Ltd v Bank South Pacific Ltd (2007) SC1322
Lama v NDB Investments Ltd (2015) SC1423
Pacific Equities & Investments Ltd v Teup Goledu (2009) SC962
Toale Hongiri Incorporated Land Group v Wolotou Incorporated Land Group (2012) SC1201
Wahgi Savings & Loan Society Ltd v Bank of South Pacific Ltd (1980) SC185

Overseas Cases

British Launderers’ Research Association v Central Middlesex Assessment Committee and Hendon Rating Authority [1949] 1 All ER 21

Counsel:

N. Pilamb, for the Appellants
C. Joseph, for the First Respondent

28^th November, 2022

1. BY THE COURT: The first respondent objects, by notice filed on 15 July 2022, to the competency of the appeal, SCA 102 of 2022.
   
2. The appeal is against a final order of the National Court of 7 June 2022, which upheld a petition by the first respondent, an aggrieved shareholder of the second respondent, under s 152 of the Companies Act and amongst other things awarded him K3 million compensation (In the matter of Canopus No 101 Ltd (2022) N9651). The appeal raises 19 grounds of appeal.
   
3. The primary grounds of objection are that most grounds of appeal involve questions of fact for which leave to appeal has not been granted contrary to the Supreme Court Act and/or fail to comply with Order 7 rules 9(c) and 10 of the Supreme Court Rules as they are unclear, fail to say why the trial judge was wrong and what the judge ought to have found, make statements without identifying the alleged error of the trial judge or make general statements that are submissions, not grounds of appeal. It is also argued that some grounds of appeal cannot succeed as a matter of law and that some grounds of appeal are against interlocutory decisions, which are not the subject of the appeal.
   

GENERAL PRINCIPLES

4. There are some general principles to apply in determining an objection to competency:
   
   • A ground of appeal that raises a question of fact only, as distinct from mixed fact and law, is only valid if leave of the Court has been granted (Supreme Court Act, s 14(1)(c)) (Dillingham Corporation of New Guinea Pty Ltd v Diaz [1975] PNGLR 262, Wahgi Savings & Loan Society Ltd v Bank of South Pacific Ltd (1980) SC185, Haiveta v Wingti (No 2) [1994] PNGLR 189).
     
   • Order 7, Rules 9(c) and 10 of the Supreme Court Rules impose three requirements for a ground of appeal:
     

(a) the ground must be stated briefly, but specifically (ie the ground must make grammatical and legal sense and be intelligible);

(b) if it is alleged that a judgment is against the evidence or the weight of the evidence, the notice must specify with particularity the ground relied on to demonstrate that it is against the evidence or the weight of the evidence;

(c) if it is alleged that the judgment is wrong in law, the notice must specify with particularity the ground relied on to demonstrate the specific reasons why the judgment is alleged to be wrong in law (Ipili Porgera Investments Ltd v Bank South Pacific Ltd (2007) SC1322, Pacific Equities & Investments Ltd v Teup Goledu (2009) SC962, Lama v NDB Investments Ltd (2015) SC1423).

• An objection to competency must demonstrate that all grounds of appeal are invalid. If one ground of appeal is identified as valid, the appeal is competent and the objection fails (Coca Cola Amatil (PNG) Ltd v Kennedy [2012] 2 PNGLR 205, Toale Hongiri Incorporated Land Group v Wolotou Incorporated Land Group (2012) SC1201).
  

CRITICAL POINT

5. The last of the principles stated above is critical. It means that the objecting party, the first respondent, must demonstrate that each of the 19 grounds of appeal is invalid in that it fails to invoke the jurisdiction of the Supreme Court. The corollary is that the opposing parties, the appellants, only need to show that one of their grounds of appeal is valid, and the objection to competency will be repelled.
   

THE FIRST GROUND OF APPEAL

6. We now consider the first ground of appeal, “A”, which states:
   

His Honour Justice Anis (the learned primary judge) erred in law in finding in its [sic] ruling especially at para 18, 28 and 48, that the removal of Mr Pais Kar Tiki as a Director of Canopus No 101 Limited (in breach of s 134 and 135 of Companies Act) is a matter properly raised for consideration under s 152 of Companies Act and it had caused the Petitioner to suffer oppression, unfair discrimination and unfair prejudice as a shareholder of Canopus, in circumstances where:

1. the learned primary judge's findings were made without any requisite discussions and findings on the law on oppressive and or unfairly discriminatory and or unfairly prejudicial conduct within the meaning of s 152 of Companies Act (Sabatica Pty Ltd v Battle Mountain Canada Ltd & Anor (2003) SC709; Thomas and HW Thomas Ltd [1984] 1 NZLR 686 at page 693; s 152(4) Companies Act);
   
2. the learned primary judge's findings were made without any requisite discussions and findings as to whether the removal of Mr Tiki as a director of Canopus and breaches of s 134 and 135 of the Companies Act amounted to conduct that is oppressive, unfairly prejudicial or unfairly discriminatory to the Petitioner as shareholder of Canopus, especially in that it:
   
   • (i) constituted an overbearing act or attitude on the part of the oppressor (Lucy v Lomas [2002] NSWSC 448);
     
   • (ii) imposed a disability or burden on the Petitioner (Wayde v NSW Rugby League Ltd [1985] HCA 68; (1985) 180 CLR 459 at 472);
     
   • (iii) caused actual damage or loss as opposed to mere prejudice or discrimination to the Petitioner (Wayde v NSW Rugby League Ltd [1985] HCA 68; (1985) 180 CLR 459, 471):
     

100. the removal of Mr Tiki as a director of Canopus did not otherwise amount to conduct that is oppressive, unfairly prejudicial or unfairly discriminatory to the Petitioner as shareholder of Canopus under s 152 of the Companies Act in that:
     
     • (i) Mr Tiki was not a director of Canopus as his purported appointment (on 5 August 2008) occurred when Canopus was deregistered from the Register of Companies;
       
     • (ii) Mr Tiki's removal caused no actual damage or loss or imposed a liability or burden on the Petitioner, who did nothing to challenge Mr TIki's removal until 2019;
       
     • (iii) Mr Tiki's removal did not breach or cause any harm to the Petitioner's rights as a shareholder under Part VII (s 78-106) of the Companies Act.
       

7. The first respondent’s objection to this ground of appeal is that it involves questions of fact and leave to argue them was required under s 14(1)(c) of the Supreme Court Act but was not obtained.
   
8. The argument being advanced in ground A is that the trial judge erred in finding that the removal of Mr Pais Kar Tiki as a director of Canopus No 101 Ltd (Canopus) had caused the first respondent (the petitioner) to suffer oppression, unfair discrimination and unfair prejudice as a shareholder of Canopus in that:
   
   • (a) his Honour did not discuss and make findings on what, as a matter of law, amounted to “oppressive, unfairly discriminatory or unfairly prejudicial” conduct regarding the affairs of Canopus, for the purposes of s 152 of the Companies Act;
     
   • (b) his Honour did not discuss and make findings on how the removal of Mr Tiki as a director of Canopus (which his Honour found was in breach of ss 134 and 135 of the Companies Act) was oppressive, unfairly discriminatory or unfairly prejudicial to the first respondent, as his Honour did not find that the conduct constituted an overbearing act or attitude on the part of the oppressor or imposed a disability or burden on the first respondent or caused actual damage or loss to the first respondent;
     
   • (c) Mr Tiki was not a director of Canopus (as his purported appointment occurred at a time when Canopus was deregistered) and his removal as a director caused no actual damage or loss and imposed no liability or burden on the first respondent and did not breach or cause harm to the first respondent’s rights as a shareholder in Canopus.
     
9. In ascertaining whether that argument entails only questions of fact, we are guided by the discussion of this issue in Toale Hongiri Incorporated Land Group v Wolotou Incorporated Land Group (2012) SC1201. We endorse the reasoning of Prentice DCJ in Dillingham Corporation of New Guinea Pty Ltd v Diaz [1975] PNGLR 262 at p 270, which referred to the following oft-quoted dicta of Lord Denning in British Launderers’ Research Association v Central Middlesex Assessment Committee and Hendon Rating Authority [1949] 1 All ER 21 at pp 25, 26:
   

On this point it is important to distinguish between primary facts and the conclusions from them. Primary facts are facts which are observed by witnesses and proved by oral testimony, or facts proved by the production of a thing itself, such as an original document. Their determination is essentially a question of fact for the tribunal of fact, and the only question of law that can arise on them is whether there was any evidence to support the finding. The conclusions from primary facts are, however, inferences deduced by a process of reasoning from them. If and so far as these conclusions can as well be drawn by a layman (properly instructed on the law) as by a lawyer, they are conclusions of fact for the tribunal of fact and the only questions of law which can arise on them are whether there was a proper direction in point of law and whether the conclusion is one which could reasonably be drawn from the primary facts: ... If and so far, however, as the correct conclusion to be drawn from primary facts requires, for its correctness determination by a trained lawyer – as, for instance, because it involves the interpretation of documents, or because the law and the facts cannot be separated, or because the law on the point cannot properly be understood or applied except by a trained lawyer – the conclusion is a conclusion of law on which an appellate tribunal is as competent to form an opinion as the tribunal of the first instance.

10. Kapi J, as he then was, put it neatly in Waghi Savings and Loan Society Ltd v Bank of South Pacific Ltd (1980) SC185:
    

Where primary facts are found (which cannot be challenged on appeal except by leave of the court) the question of law is what is the proper conclusion to be drawn from those facts. It has been shown in decided cases that where inferences or conclusions are drawn from these primary facts which cannot reasonably be drawn, then this is an error of law.

11. Applying those principles here, we consider that the only question of fact involved in ground of appeal A is whether Canopus was deregistered at the time of Mr Tiki’s appointment (stated as 5 August 2008). That question is mixed with other questions, which do not involve a consideration of primary facts, but which are questions of law, including:
    
    • whether the removal of Mr Tiki has caused the first respondent to suffer oppression, unfair discrimination and unfair prejudice as a shareholder of Canopus;
      
    • whether the trial judge discussed and made findings on what, as a matter of law, amounted to “oppressive, unfairly discriminatory or unfairly prejudicial” conduct for the purposes of s 152 of the Companies Act;
      
    • whether his Honour made findings on how the removal of Mr Tiki as a director of Canopus was oppressive, unfairly discriminatory or unfairly prejudicial to the first respondent;
      
    • whether Mr Tiki’s removal as a director caused actual damage or loss and imposed any liability or burden on the first respondent and breached or caused harm to the first respondent’s rights as a shareholder in Canopus.
      
12. We find that ground A entails questions of mixed fact and law. This means that leave to argue it was not required. No other objection is made to ground A, and there are no good reasons for regarding it as invalid. It is deemed to be valid.
    
13. This means, applying the critical principle from Coca Cola Amatil (PNG) Ltd v Kennedy [2012] 2 PNGLR 205, that the appeal is competent and the objection to competency fails.
    

OTHER GROUNDS OF APPEAL

14. A cursory examination of the other 18 grounds of appeal reveals that though many are overly complex and prolix and would benefit from a more concise drafting, most are essentially raising questions of mixed fact and law and compliant with Order 7 rules 9(c) and 10 of the Supreme Court Rules.
    

CONCLUSION

15. The objection to competency must be refused. The appeal will be referred to the Duty Judge. Costs will follow the event.
    

ORDER

(1) The objection to competency, filed by notice of objection to competency on 11 August 2022, is refused.

(2) The first respondent shall pay the appellants’ costs of the objection to competency on a party-party basis, which shall if not agreed be taxed.

(3) The proceedings are adjourned to the Registry and shall be referred to the Duty Judge for directions as soon as is practicable.

________________________________________________________________
Mel & Hennry Lawyers: Lawyers for the Appellant
Ashurst Lawyers: Lawyers for the First Respondent