Cloudy Bay Sustainable Forestry Ltd v Pako F & C Holdings (PNG) Ltd [2022] PGSC 137; SC2337 (22 December 2022)

SC2337

PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]

SCA NO.126 OF 2021

BETWEEN:
CLOUDY BAY SUSTAINABLE FORESTRY LIMITED
Applicant

AND:
PAKO F & C HOLDINGS (PNG) LIMITED
Respondent

Waigani: David J
2022: 16^th & 22^nd December

PRACTICE & PROCEDURE – application for leave to proceed with a slip rule application – application to be made in Form 4 - Supreme Court Rules, Order 11 Rule 32, Order 13 Rule 15.

Cases Cited:
Re Trawen v Kama (2010) SC1063
Agiru v Kailabe (2015) SC1412
The State v The Transferees (2016) SC1488
Barrick (Niugini) Limited v Stanley Nekital (2020) N8652
Pako F & C Holding (PNG) Ltd v Cloudy Bay Sustainable Forestry Ltd (2021) N9141

Counsel:
David Dotaona, for the Applicant
Phillip Tabuchi with Menchie Numi, for the Respondent

RULING

22^nd December, 2022

1. DAVID, J: INTRODUCTION: This is a ruling on an application for leave to proceed with a slip rule application filed by the applicant, Cloudy Bay Sustainable Forestry Limited on 29 November 2022 under Order 11 Rule 32 of the Supreme Court Rules alleging that the full Court committed a slip in the ruling it delivered on 22 November 2022 to dismiss the appeal for want of prosecution. The Applicant also relies on s.155(4) of the Constitution, but that is unnecessary in light of Order 11 Rule 32. The application before the full Court for hearing and determination on 22 November 2022 was an application by the Respondent to dismiss the appeal for want of prosecution filed on 8 August 2022. The application is subject to leave under Order 11 Rule 32(3) which requires that ‘[a] ‘slip rule’ application shall not be listed for hearing before the Court unless a Judge of the Court making the order from which the application arises, or that Court has granted leave for the application to proceed’. I was a Judge of the Court that made the order on 22 November 2022.
   

2. A Notice of Objection to Competency of the Application for Leave to Apply for Slip Rule Application to proceed filed by the Respondent on 13 December 2022 was withdrawn following engagement and discussions between the bench and Mr. Tabuchi of counsel for the Respondent and he was allowed to make submissions on the objection when responding to the Applicant’s submissions.

BRIEF BACKGROUND

3. On 20 September 2021, after a trial on quantum, the National Court awarded damages in favour of the Respondent in the sum of K117,480,118.92: Pako F & C Holding (PNG) Ltd v Cloudy Bay Sustainable Forestry Ltd (2021) N9141, annexure MCN1, affidavit of Menchie Numi. Liability was determined against the Applicant on 12 July 2018 by the National Court: annexure MCN2, affidavit of Menchie Numi. An application for leave to review filed by the Applicant on 30 October 2018 challenging the judgment on liability was dismissed on 18 December 2019: annexure MCN3, affidavit of Menchie Numi. The Appellant filed a Supplementary Notice of Appeal on 25 October 2021. On 22 November 2022, the full Court dismissed the appeal for want of prosecution.

GROUNDS OF APPLICATION

4. The Applicant relies on eight main grounds which are set out at paragraph 2 of the application and these are:

“2.1 Their Honours erred in law and fact in exercising their discretion mistakenly as to the facts to dismiss the appeal for want of prosecution by referring to the Appellant’s non-compliance with a court order of 2 December 2021 when the Respondent did not produce evidence of a sealed court order made on 2 December 2021.

2.2 Their Honours erred in law and fact in exercising their discretion mistakenly as to the facts to dismiss the appeal for want of prosecution by referring to the Appellant’s non-compliance with a court order of 2 December 2021 when the Appellant’s only filed in court a file endorsement signed by an Associate by the name of Doris Joseph, but not signed by the judge and without the seal of the Court.

2.3 Their Honours erred in law and fact in exercising their discretion mistakenly as to the facts to dismiss the appeal for want of prosecution by referring to the Appellant’s non-compliance with a court order of 2 December 2021 when the Respondent did not produce evidence to show the court order of 2 December 202[1] is in the court file and is listed on the court file index.

2.4 Their Honours erred in law and fact in exercising their discretion mistakenly as to the facts to dismiss the appeal for want of prosecution by relying on the Respondent’s written submission filed on 7 November 2022 at paragraph 10 e. where it referred to Directions Orders of 2 December 2021 (court doc # 44), when there are no Directions Orders of 2 December 2022 known as court doc # 44 on the court file or listed in the court file index.

2.5 Their Honours erred in law and fact in exercising their discretion mistakenly as to the facts to dismiss the appeal for want of prosecution by referring to the Appellant’s non-compliance with a court order of 2 December 2021 when the Respondent did not produce evidence to show that the court order of 2 December 2021 was in fact served on the appellant or its lawyers.

2.6 Their Honours erred in law and fact in exercising their discretion to dismiss the appeal for want of prosecution without taking into account the large judgment sum obtained ex parte by the Respondent at the liability and assessment of damages stage in the National Court which was a material consideration.

2.7 Their Honours erred in law and fact in exercising their discretion to dismiss the appeal for want of prosecution without taking into account that there was no undue delay and that the Respondent had contributed to the delay in the appeal by filing a Notice of Objection to Competency of the Supplementary Appeal filed on 11 November 2021 which was dismissed by the Supreme Court on 15 July 2022.

2.8 It is in the interest of justice that the Court grant leave to review to the Applicant to apply for a slip rule application.”

EVIDENCE

5. In the Application, the Applicant specifically relies on the affidavit of Charlie Arua sworn and filed on 29 November 2022 (doc 162). At the hearing, the Applicant also relied on an affidavit of Charlie Arua sworn and filed on 12 December 2022. No serious objection was raised by the Respondent on the Applicant’s reliance on the latter affidavit of Charlie Arua. That latter affidavit annexes a copy of the transcript of proceedings and in particular the court’s unanimous ruling made on 22 November 2022. I have considered these affidavits.

6. The Respondent relies on and reads the affidavit of Menchie Numi sworn on 12 December 2022 and filed on 13 December 2022.

RESPONDENT’S POSITION

7. The Respondent contests the application.

APPLICANT’S SUBMISSIONS

8. The Applicant submits that the eight grounds relied on in support of the application demonstrate an arguable case and therefore leave should be granted for the slip rule application to proceed. The principal contentions are:

1. A formal minute and entry of an order is necessary if it is to be served or enforced even if it is a direction.
2. There was no evidence that the Registrar signed the order of 2 December 2021.
3. There was no evidence that the Registrar sealed a minute of the order of 2 December 2021.
4. There was no evidence that the order of 2 December 2021 was served on the Appellant if it were to be enforced and relied upon by the Respondent.
5. There was no unnecessary or undue delay in the prosecution of the appeal.
   

9. As to the Respondent’s argument on the competency of the application, the Applicant essentially submits that the objection was without merit and should be rejected.

10. In support of the Applicant’s contentions, it relies on a National Court decision of Barrick (Niugini) Ltd v Stanley Nekital (2020) N8652 where at [23] Kandakasi, DCJ made the following observations:

“As can be seen clearly, from the forgoing authorities, a formal minute and its entry is necessary if it is to be served and or enforced. This would be applicable for instance in the case of urgent interim injunctive orders that may have to be served on persons other than the parties in a proceeding. For the parties in a proceeding, they would have been in court when the judgment or orders are pronounced except, in ex parte proceedings, they would have to take the appropriate steps and comply. There would be no need for a formal minute to be taken out and served on one of the parties by the other. This makes sense, especially where proceedings before the Court needs to progress to its finality at the earliest possible without any unnecessary delay along the way. In recent times, a number of lawyers and their clients have been taking the position that, if no formal minutes are taken out and entered, they are excused from compliance. The kinds of orders I am speaking of here are the direction type orders for parties to take certain steps to progress matters to enable expedited resolution through their direct negotiations or through mediation facilitated negotiations or by trial.“ (my emphasis)

RESPONDENT’S SUBMISSIONS

11. The Respondent submitted that the application was incompetent for want of form because it was not in the prescribed form as was mandatorily required by Order 13 Rule 15 of the Supreme Court Rules.

12. The Respondent’s contentions in relation to each ground of the application for leave are these:

1. As to Ground 2.1, the Applicant did not raise any issue about there being no evidence of a sealed court order made on 2 December 2021 which was not complied with by the Applicant at the hearing of the application to dismiss for want of prosecution and was simply endeavouring to raise or introduce a new argument.
2. As to Ground 2.2, the handing up of the court endorsement was prompted by a direct enquiry by the court if the Applicant’s lawyer, Mr. Dotaona was in Court on 2 December 2021, the endorsement verified Mr. Dotaona’s attendance which was accepted by the court, and there was no dispute that directions were made on 2 December 2021.
3. As to Grounds 2.3 and 2.4, the arguments for Grounds 2.1 and 2.2 are adopted and applied.
4. As to Ground 2.5, there is no requirement for the Respondent to serve the orders/directions made on 2 December 2021 as Mr. Dotaona was in attendance in court on 2 December 2021 when they were made and no challenge was raised by Mr. Dotaona at the hearing of the application to dismiss the appeal for want of prosecution that no such directions were made on 2 December 2021.
5. As to Ground 2.6, the question of quantum of damages is and was not a relevant consideration in an application to dismiss for want of prosecution.
6. As to Ground 2.7, the court, having been satisfied that directions were made on 2 December 2021 which Mr. Dotaona, at the hearing, did not challenge or dispute and the Applicant had failed to comply with those directions, found that the appeal was not prosecuted with due diligence.
7. As to Ground 2.8, the interest of justice flows both ways, ie, in the present case, the court having been satisfied that the Applicant did not prosecute the appeal with due diligence and did not comply with the court’s directions of 2 December 2021 and that no reasonable or satisfactory explanation was provided to the court by the Applicant, it was in the interest of justice to dismiss the appeal for want of prosecution.
   

13. The respondent therefore submits that the application for leave to proceed with a slip rule application should be refused because:

1. The Applicant has failed to establish that the court exercised its discretion mistakenly;
2. The Applicant has failed to establish how, where and when the court was in error as to law and/or facts;
3. The Applicant did not dispute the fact that the directions in question were made on 2 December 2021 and the Applicant had failed to comply with those applying to it;
4. The Applicant has failed to demonstrate that any slip was of the Court’s own doing; and
5. The court was satisfied that the Applicant’s counsel, Mr. Dotaona was in attendance in court on 2 December 2021 when directions were made, he knew and was aware that such directions were made and the Applicant failed to comply with those directions.
   

THE LAW

14. Rule 32 of the Supreme Court Rules allows for a slip rule application to be filed within 21 days of the order disposing of the proceeding (Order 11 Rule 32(1) and leave is required (Order 11 Rule 32(3).

15. Order 13 Rule 15 of the Supreme Court Rules requires that all interlocutory applications must contain a concise statement of the Court’s jurisdiction to grant the orders that are being sought and must be made in Form 4.

16. In The State v The Transferees (2016) SC1488, the Supreme Court observed that mandatory requirements under Order 11 Rule 32 and Order 13 Rule 15 of the Supreme Court Rules must be strictly complied with as the need to comply with those mandatory requirements goes to the jurisdiction of the Court to hear the slip rule application.

17. The basis of a slip rule application was decided by a five-member bench of the Supreme Court in Re Trawen v Kama (2010) SC1063 and these are:

1. The purpose is to correct a glaring error or mistake in a judgment or order of the court such as a clerical mistake, an accidental omission or misinterpretation of fact or law.
2. It is not available under Section 155(2)(b) (as that concerns the inherent power to review the judicial acts of the National Court) or Section 155(4) of the National Constitution.
3. It is generally made before the Court constituted by the same judges who heard and determined the appeal or review unless a judge was or judges were not available in which case the Chief Justice may appoint replacement judges.
4. Leave is required by the very nature of the application.
   

18. Generally, in a slip rule application, it is incumbent upon the applicant to establish that:

1. The original decision contained a glaring (or clear and manifest) error or mistake of fact or law. It must be something that stands out above all else and is not merely arguable; and
2. The error of fact or law concerned a critical issue; and
3. The misapprehension of fact or law was not the applicant’s own making.
   

19. In deciding whether to grant or not to grant a slip rule application, it is a matter of discretion bearing in mind that:

1. There is substantial public interest in the finality of litigation.
2. On the other hand, any injustice should be corrected.
3. The purpose is not to allow rehashing of arguments already raised or to allow raising of new arguments that were not put before the Court making the order from which the application arises.
   

20. The Supreme Court must be slow to considering a slip rule application, hence the requirement to seek leave as a pre-condition.

21. The principles applying to an application for leave for a slip rule application were stated in Agiru v Kailabe (2015) SC1412 and these are:

1. An applicant must file his/her application for leave within 21 days after the order disposing of the proceeding in accordance with Order 11 Rule 32(1) of the Supreme Court Rules.
2. The applicant must satisfy the Court that the slip rule application would have a strong chance of success and the standard of satisfaction is rather high.
   

CONSIDERATION

22. There is no issue about the first pre-condition and that is considered in the Applicant’s favour. The slip rule application was filed on 29 November 2022 which was well within 21 days of the order disposing of the appeal.

23. Is the slip rule application itself competent? No. I think there are flaws in the form of the application. It is not entirely in accordance with Form 4. Form 4 requires compliance with Form 17 as well and that is not demonstrated.

24. In case I am wrong in arriving at the conclusion that the application itself is incompetent (which I think I am not) and the manner in which the issue has arisen, I will proceed to address the grounds relied upon in the application.

25. Has the applicant demonstrated to my satisfaction on the requisite higher standard that the slip rule application would have a strong chance of success?

26. A copy of the transcript of the Supreme Court’s ruling made on 22 November 2022 is annexed to the affidavits of Charlie Arua sworn and filed on 12 December 2022 and of Menchie Numi which I have perused and considered in light of the grounds supporting the application.

27. I concur with the Respondent’s submissions on each ground and adopt and apply them in their entirety here.

28. I will add that the Applicant gains nothing in the context of the present case in its reliance on the observations made by Kandakasi DCJ at paragraph 23 of the decision in Barrick (Niugini) Ltd v Stanley Nekital (2020) N8652. The relevant observations actually support the Respondent’s position. The directions made on 2 December 2021 took effect on the date on which they were made.

29. As to the ground based on the large judgment sum of K117,480,118.92, my additional observation is that this could be considered in the context of interest of justice. However, as has been argued by the Respondent, interest of justice flows both ways and in the present case, it favours the Respondent.

30. I am of the view that the Applicant has failed to demonstrate to my satisfaction on the requisite higher standard that the slip rule application would have a strong chance of success.

31. The second pre-condition has not been satisfied.

32. For these reasons, I decline to grant the leave sought.

ORDER

33. I make the following orders:

1. The application for leave predicated upon the Application filed on 29 November 2022 is declined and dismissed.
2. Costs shall follow the event, ie, costs are awarded against the Applicant, which shall, if not agreed, be taxed.
   

Ruling accordingly.
________________________________________________________________
Dotaona Lawyers: Lawyers for the Applicant
Young & Williams: Lawyers for the Respondent