Kenken v National Airports Corporation Ltd [2022] PGSC 52; SC2247 (26 May 2022)

SC2247

PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]

SCA NO. 144 OF 2020

BETWEEN:
JEREMIAH FRED KENKEN AND ALICE KENKEN
First Appellant

AND:
KRISTIES RENT-A-CAR LIMITED
Second Appellant

AND:
NATIONAL AIRPORTS CORPORATION LIMITED
Respondent

Waigani: Murray, Collier & Toliken JJ.
2022: 26^th May

PRACTICE & PROCEDURE – summary disposal of proceedings in the National Court for want of compliance by appellants - Order 10, Rule 9A (15)(2)(c) of the National Court Rules 1983 – exercise of discretion by primary Judge – caution of appellate court in substituting discretionary decision of primary Judge – appellants sought to take issue with orders of primary Judge not subject of appeal – interests of justice require compliance with Court Orders by parties – habitual non-compliance by appellants with directions in National Court proceedings – failure of appellants to comply with directions of Supreme Court – appeal dismissed

Cases Cited:

Curtain Bros (PNG) Ltd v University of Papua New Guinea [2005] SC788;
Lomai v Seal (Manus) Ltd [2008] SC 1326;
Manase v Polye [2013] SC1329;
Stettin Bay Lumber Company Pty Ltd v Arya Ship Management Ltd [1995] SC488;
The Government of Papua New Guinea v Barker [1977] PNGLR 386;
WS No. 521 of 2017 – Jeremiah Fred Kenken & Alois Kenken vs National Airports Corporation.

Counsel:

B. Kome, for the Appellants
I. David, for the Respondent

REASONS FOR JUDGMENT

26^th May, 2022

1. BY THE COURT: Before the Court is an appeal, filed by the first and second appellants on 10^th November 2020, from the decision of a Judge of the National Court (primary Judge) delivered on 2^nd October 2020. Materially, in that decision the primary Judge dismissed the proceedings for non-compliance with his Honour’s orders of 9^th March 2020.

2. The grounds of appeal outlined in the appellants’ notice of appeal filed 10^th November 2020 are as follows:

(1) The primary Judge erred in law and in fact in wrongly issuing ad hoc directions on 9^th March 2020 for the Appellants to further amend the already amended Statement of Claim when:

• (a) The already amended Statement of Claim filed on 24^th July 2018 contains sufficient particulars of the alleged breach of contract, which were validated by the Court on 10^th December 2018
• (b) Neither party questioned the sufficiency of pleadings in the Amended Statement of Claim filed on 24^th July 2018; and
• (c) It was an abuse of court processes to allow sequence of amendments to the Statement of Claim on ad hoc directions with no reasonable justification; and
• (d) The Respondent who filed an Amended Defence on 19^th December 2018 in response to the Amended Statement of Claim filed on 24^th July 2018 was not prejudiced in any circumstances; and
• (e) There was no reasonable justification given the need to allow further amendment to the already Amended Statement of Claim filed on 24^th July 2018.
  

(2) The primary judge wrongly exercised its discretion in dismissing the proceeding for non-compliance of the court directions for amending the Statement of Claim when;

• (a) The Appellants have already filed an Amended Statement of Claim on 24^th July 2018 and served it on the Respondent’s lawyers on 6^th August 2018, which was subsequently validated by the Court on 10^th December 2018; and
• (b) The Respondent had filed an amended Defence on 19^th December 2018, in response to the Amended Statement of Claim filed on 24^th July 2018; and
• (c) There was no need for further amendments to be made on the Amended Statement of Claim filed on 24^th July 2018; and
• (d) No party was prejudiced by the non-compliance of the Court directions of 09^th March 2020.
• (e) There was no reasonable justification given for the need to allow further amendment to the already Amended Statement of Claim filed on 24^th July 2018.

(3) The primary judge wrongly exercised its discretion in placing so much weight on the strict compliance of the court direction and gave less or no consideration to the question of prejudice and interest of justice when;

• (a) No party was prejudiced by the non-compliance of the Court directions of 9^th March 2020; and
• (b) The Appellants had a valid cause of action against the respondent based on breach of contract;
• (c) The appellants were entitled to a fair hearing at all stage of the proceeding; and
• (d) The non-compliance of the Court directions of 9^th March 2020 was not intentional or serious as the amendments already made on the Statement of Claim under previous court directions were sufficient and there was no need for further amendments.
  

3. The appellants seek the following relief:

(a) The Appeal be upheld.

(b) The judgment of the primary judge given on 2^nd October 2020

be quashed.

(c) The lower Court proceeding styled as WS No. 521 of 2017 –

Jeremiah Fred Kenken & Alois Kenken vs National Airports Corporation be reinstated before a different judge;

(d) The Respondent pays the cost of and incidental to this appeal.

4. This morning when we came to Court neither the appellants nor the respondent had filed submissions in this matter. We subsequently allowed brief oral submissions and material to be handed up.

BACKGROUND

5. On 26^th May 2017 the appellants (then plaintiffs) filed a writ of summons and statement of claim against the respondent (then defendant) seeking damages for breach of contract under a purported oral tenancy agreement between the appellants and the respondent.

6. Extensive interlocutory activity took place subsequent to that date.

7. On 9^th March 2020 the primary Judge ordered as follows:

1. Leave is granted to the Plaintiff to file and serve a Further Amended Statement of Claim in terms of the draft comprising of Annexure B to the Affidavit of service of Alice Kenken sworn on 4^th February, 2020 and filed on 3^rd of March 2020 by 16^th March 2020.
   
2. The Defendant to file and serve its Defence to the Further Amended Statement of Claim by 27^th March, 2020.
   
3. The Plaintiff shall file and serve its Reply and all Affidavits by 30^th April, 2020.
   
4. The Defendant shall file and serve all affidavits by 29^th May, 2020.
5. The Plaintiffs shall file and serve any affidavits in reply by 12^th June 2020.
   
6. Before 14^th June 2020, all parties shall prepare, settle and file a Statement of Agreed and Disputed Facts and issues for Trial.
   
7. If Parties are ready, Notice to Set Down for Trail shall be signed and filed and served by 13^th June 2020.
   
8. Matter is adjourned to 14^th July 2020 at 9.30 am for listings and further directions.

(emphasis added)

8. The appellants failed to comply with Order 1 of the orders dated 9^th March 2020 by not serving the further amended statement of claim on the respondents by 16 March 2020.

9. The further amended statement of claim was actually served on the respondent some months later, on 7^th May 2020. That this is so appeared from the transcript of the directions hearing before the primary Judge of 21^st August 2020, where then Counsel for the respondent submitted that the further amended statement of claim was served on that date.

10. Consequently, the appellants sought, by a notice of motion filed on 9^th June 2020, that the time for the service of their further amended statement of claim be extended, and that the further amended statement of claim filed on 12^th March 2020 be taken to have been served on 7^th May 2020 and in compliance with the orders of 9^th March 2020.

11. The respondents filed a notice of motion on 22^nd July 2020 seeking the dismissal of the National Court proceeding on the grounds that:

(1) The appellants had not disclosed a reasonable cause of action, and the proceeding was frivolous, vexatious and an abuse of process; or

(2) The appellants failed to comply with orders dated 9^th March 2020.

12. On 21^st August 2020, the primary Judge heard oral arguments in respect of both notices of motion. At that hearing, the appellants’ legal representative submitted, in summary:

• he had been unable to file and serve the amended statement of claim by 16^th March 2020, despite having attended the registry on 11^th, 12^th and 16^th March, because the Court file had been in chambers;
  
• the file had remained in chambers until 19^th March 2020, on which date he obtained a court endorsement given the Assistant Registrar was not present to sign the amended statement of claim;
  
• on 20^th March 2020 he again attended the Courthouse, and found it to be closed owing to the COVID-19 pandemic;
  
• on 3^rd May 2020 he again attended the registry and found two registry officers were present; he then asked them to file the further amended Statement of Claim which they did;
  
• the further amended statement of claim was then served on the respondent in early May.
  

13. Materially for the purposes of the present appeal, the respondents submitted that the proceeding should be dismissed for non-compliance in accordance with Order 10, Rule 9A (15)(2)(c) of the National Court Rules 1983. This Rule provides:

15. SUMMARY DISPOSAL

...

(2) The Court may summarily dispose of a matter in the following situations:

...

(c) for non-compliance of any order or directions previously made or issued by the Court at any of the listing processes.

14. In support of this argument the respondent contended in summary that:

• It had written to the appellants’ legal representative on 18^th March 2020 stating that the amended statement of claim had not been received and, if the document was not received within seven days, an application for dismissal of the proceedings would be made;
  
• A letter repeating this position was sent to the appellants on 22^nd April 2020;
  
• No response was received by the respondent to either letter;
  
• The amended statement of claim was only served on the respondent on 7^th May 2020, despite it being filed on 12^th March 2020;
  
• The appellants failed to seek leave to apply for an extension of time to comply with Court orders despite knowing they were in non-compliance;
  
• The proceeding had been delayed on multiple occasions owing to non-attendance of the appellants’ legal representatives at Court hearings; and
  
• The appellants had already been granted leave on two occasions to amend their statement of claim.

15. The respondent further submitted that the registry had closed on 23^rd March 2020, evidenced by a public notice published by the registrar, as a result of the COVID-19 pandemic, not 20^th March 2020 as submitted by the appellants. This directly contradicted the oral submissions of the appellants’ Counsel.

16. Further, and contrary to the assertion that the Court file remained in chambers until 19^th March 2020 (such that no further material could be filed until then), the appellants’ further amended statement of claim and the orders of 9^th March 2020 were filed by the appellants on 12^th March 2020. This pattern of behaviour, in the respondent’s submission, amounted to an intentional and blatant disregard for the Court’s authority and a consistent failure to prosecute their case.

17. In the alternative, the respondent made submissions to the effect that the proceeding should be dismissed as frivolous, vexations and/or an abuse of process. We note that this aspect of the respondent’s case was considered and rejected by the primary Judge.

18. In dismissing the proceeding in reasons published on 2^nd October 2020, the primary Judge at [4]–[6] rejected the appellants’ version of events explaining their non-compliance. In particular, his Honour noted that there was no evidence that the appellants had enquired as to the location of the Court file to Court staff, and that the closure of the Registry had occurred after 16^th March 2020. Further, his Honour noted that as at 21^st August 2020 the appellants had not filed and served all affidavits on which they relied despite being given two extensions in as many years in which to do so, and that the appellants’ legal representative had continually failed to appear at Court hearings. In dismissing the proceeding for non-compliance, his Honour concluded at [22] of his reasons:

Such a continuous and deliberate disregard of the court process and orders, in my view, warrants and justifies this court preventing its process from being further abused by putting a stop to this proceeding.

CONSIDERATION

19. It is common ground that the decision by the primary Judge to summarily dismiss the National Court proceedings was an exercise of discretion by the primary Judge. Relevant principles are well settled. As explained in such cases as The Government of Papua New Guinea v Barker [1977] PNGLR 386 and Stettin Bay Lumber Company Pty Ltd v Arya Ship Management Ltd [1995] SC488, appellate Courts approach appeals against exercise of discretion with caution. As explained in Barker, what must be shown is that the primary Judge:

... exercised his discretion upon a wrong principle, has allowed extraneous or irrelevant matters to guide or affect him, mistaken the facts, or not taken into account some matter for consideration. Then and then only then... the lower court having been shown to be clearly wrong in its decision, or it appearing that otherwise injustice will be done, the appellant court may exercise its own discretion in its own discretion in substitution for that of the lower court, if it has the material for doing so.

20. See also Curtain Bros (PNG) Ltd v University of Papua New Guinea [2005] SC788 and Manase v Polye [2013] SC1329.

21. Accordingly, it is for the appellants to demonstrate that his Honour erred in the exercise of his discretion. In light of this principle we now turn to the grounds of appeal before the Court.

Ground 1

22. In the first ground of appeal, the appellants assert that the primary Judge erred in law and in fact in wrongly issuing “ad hoc” directions on 9^th March 2020 for the appellants to further amend the already amended statement of claim when:

(a) The already amended Statement of Claim filed on 24^th July 2018 contains sufficient particulars of the alleged breach of contract, which were validated by the Court on 10^th December 2018;

(b) Neither party questioned the sufficiency of pleadings in the Amended Statement of Claim filed on 24^th July 2018; and

(c) It was an abuse of court processes to allow sequence of amendments to the Statement of Claim on ad hoc directions with no reasonable justification; and

(d) The Respondent who filed an Amended Defence on 19^th December 2018 in response to the Amended Statement of Claim filed on 24^th July 2018 was not prejudiced in any circumstances; and

(e) There was no reasonable justification given the need to allow further amendment to the already Amended Statement of Claim filed on 24^th July 2018.

23. In our view, this ground of appeal actually seeks to take issue with the orders of the primary Judge of 9^th March 2020, rather than challenge the validity of his Honour’s orders of 2^nd October 2020 dismissing the proceedings for non-compliance with the 9^th March 2020 orders. We note that there was never any appeal against the orders of 9^th March 2020, although the appellants sought to extend time for compliance with them. Indeed, the appellants actually filed a further amended statement of claim in compliance with those orders, although they failed to serve in compliance with those orders.

24. A similar issue was considered by the Supreme Court in Lomai v Seal (Manus) Ltd [2008] SC1326. In that case, Kirriwom, Cannings and Yagi JJ relevantly observed:

10. Grounds 2 and 3 are basically challenging the legality of the orders of 24^th May 2006 of Kandakasi, J. The appellant contended that the orders made by Gabi J dismissing the appellant’s appeal cannot be allowed to stand because his Honour relied on the self-executing order made by Kandakasi J on 24^th May 2006 which the appellant said was wrong.
    
11. This order was never challenged either by application to set aside or by an appeal against it. All that the appellant did was file a motion on 15^th June 2006 seeking dismissal of the defendant's motion filed 9^th June 2006 or in the alternative, an order for to set aside or to vary Kandakasi J's self-executing or conditional order of 24^th May 2006.
    
12. It was strongly contended before us that these grounds of appeal were misconceived as they were challenging the decisions of Kandakasi J that the appellant was already precluded from raising now when he failed to appeal it or have it set aside at the time it was made. His right to challenge this order was already extinguished with the appeal time already lapsed. He therefore could not use the decision by Gabi J as the basis for his appeal against an earlier appeal. The court was referred to Jack Livinai Patterson v PNG Law Society [2005] SC822 where the Supreme Court was strongly critical of this practice:
    

The issue in this appeal, is whether the trial judge had erred in dismissing the appellant's appeal before the National Court for failing to comply with the Court's orders for discovery of documents? The appellant's responsibility in this appeal was to demonstrate to the Supreme Court where the trial judge had gone wrong in dismissing his appeal? Why does the appellant say that the trial judge should not have dismissed his appeal although he may not have complied with the court orders for discovery of documents?

The appellant did not address this issue but instead he challenged the orders of 19^th November, 2003 under the shadow of the orders of 11^th February, 2004. He had already foregone his right of appeal against this judgment by not challenging it earlier and he was already three months out of time. Either by deliberate choice or misunderstanding the appellant wants this court to believe or accept that he had done everything right since lodging his appeal against the decision of the Lawyers Statutory Committee but Justice Kandakasi dismissed his appeal without giving him an opportunity to be heard. He has not once faced the reasons for the dismissal of his appeal squarely, and honestly inform either the National Court or this Court as to why he failed to comply with the order for discovery of documents when the best he presented was that he had provided those documents to the Committee and those were sufficient for the Court to rely on in the hearing of his appeal.

13. We agree with the respondent that the appellant is prohibited by law from couching his grounds of appeal in the way he had phrased them because in reality he is challenging the decision of Kandakasi J although the appeal is against the decision of Gabi J. These grounds are incompetent and must be dismissed.
    

25. Ultimately, their Honours held that the appellant in that case had failed to demonstrate to the Court that the Gabi J had fallen into error in dismissing the entire proceeding where the appellant had failed to comply with Kandakasi J’s orders and had neglected to seek an extension of time prior to the expiry of the orders.

26. Similar considerations apply in the case before us. This ground of appeal has no merit and must be dismissed.

Ground 2

27. This ground of appeal raises similar issues to ground 1. In our view it should be dismissed for the same reasons as ground 1.

28. In any event, we note that, despite the appellants’ complaint averring that there was no need for further amendments to be made to the amended statement of claim filed on 24^th July 2018, they proceeded to file a further amended statement of claim on 12^th March 2020.

Ground 3

29. The appellants’ third ground of appeal complained that the primary Judge erred in exercising his discretion by placing “so much weight” on the “strict compliance of the court directions” and that his Honour “gave less or no consideration to the question of prejudice and interests of Justice”.

30. Contrary to the apparent belief of the appellants, the interests of justice require, at the very least, that parties comply with Court orders. Compliance with directions is not simply a matter of convenience for the parties, to be adhered to when it is suitable for them; it is crucial to the administration of justice and for the parties to understand the case which they have to meet in a timely manner. As the Supreme Court observed in Lomai:

14. Litigants and especially lawyers representing their clients must take heed of court orders and comply with them. Orders or directions given by the court are to be obeyed by all parties who seek redress through the courts and all persons to whom the order relates. A party may not like an order made but as long as it remains in force, he must obey its command. This has been emphasized many times over in this jurisdiction in reported and unreported cases including Patterson v PNG Law Society (supra) where the Court said when quoting the often cited principle of Hadkinson v Hadkinson [1952] 2 All ER 567 which states (per Lomer LJ) at p 569:

It is the plain and unqualified obligation of every person against, or in respect of, whom an order is made by a court of competent jurisdiction to obey it unless and until that order is discharged. The uncompromising nature of this obligation is shown by the fact that it extends even to cases where the person affected by an order believes it to be irregular or even void. Lord Cottenham LC, said in Chuck v Cremer (1846) 1 Coop T Cott 205; [1846] EngR 924; 47 ER 820: "A party, who knows of an order, whether null or valid, regular or irregular, cannot be permitted to disobey it ... It would be most dangerous to hold that the suitors, or their solicitors, could themselves judge whether an order was null or valid — whether it was regular or irregular. That they should come to the court and not take upon themselves to determine such a question. That the course of a party knowing of an order, which was null or irregular, and who might be affected by it, was plain. He should apply to the court that it might be discharged. As long as it existed it must not be disobeyed.

31. Relevant principles were plainly appreciated by the primary Judge. As his Honour observed at [16] of his reasons:

16.1 The plaintiff’s default has been intention [sic[ and contumelious; or

16.2 (a) There has been inordinate delay in the prosecution of the claim;

(b) No reasonable explanation is given by the plaintiff for the delay;

(c) The delay has caused prejudice to the defendant or that a fair trial would not be possible; and

(d) The justice of the case favours such dismissal (General Accident Fire & Life Assurance Corporation Ltd v Ilimo Farm Products Pty Ltd [1990] PNGLR 331, 333)

32. The proceeding the subject of this appeal was commenced in 2017 in relation to an oral tenancy agreement purportedly entered into by the parties in 2014, and a result of an alleged breach of that contract in March 2016. As the primary Judge explained, during the past 6 years the appellants have displayed the following acts of non-compliance:

(1) On 19^th June 2018 the appellants did not appear for hearing of the respondent’s notice of motion filed 3^rd April 2018;

(2) On 8^th August 2018 the appellants did not appear pursuant to the Orders of 19^th June 2018;

(3) On 13^th September 2018 the appellants did not appear pursuant to the Orders of 8^th August 2018, at which time the Court ordered that unless the appellants appeared on 5^th October 2018, the proceeding would be dismissed for want of prosecution (this date was later amended to 19^th October 2018 as the Court was not sitting on 5^th October 2018);

(4) On 19^th October 2018 the appellants did not appear and the proceeding was adjourned to 10^th December 2018 with an order that the proceeding would be dismissed for want of prosecution if the appellants did not appear;

(5) On 1^st March 2019 the appellants failed to file and serve all affidavit material they intended to rely on at trial as ordered on 1^st February 2019, and again failed to file and serve all that affidavit material by 30 April 2020 after being provided an extension until 9^th March 2020 and subsequently 20^th April 2020;
(6) At the hearing of 21^st May 2019 the appellants did not appear;

(7) At the hearing of 22^nd July 2019 the appellants did not appear;

(8) At the hearing of 23^rd September 2019 the appellants did not appear;

(9) At the hearing of 17^th February 2020 the appellants did not appear, and the Court ordered that unless the appellants appeared on 9^th March 2020 the proceeding would be liable to be dismissed for want of prosecution and the appellants’ persistent non-appearance;

(10) On 16^th March 2020 the appellants failed to serve the Amended Statement of Claim on the Respondents pursuant to the Orders of 9^th March 2020.

33. We note further that material before the Court indicates that the appellants are based in Mount Hagen, where relevant hearings were conducted before the primary Judge. To that extent they could not be seen to complain about the convenience to them of actually appearing at listed Court hearings before his Honour.

34. In our view, the appellants’ submission that the primary Judge erred in placing too much weight on the appellants’ non-compliance is entirely unfounded.

35. The appellants’ notice of appeal asserts that no party was prejudiced by the non-compliance of the Court directions of 9^th March 2020. This ground is wholly unfounded. The respondent was entitled to be served with a further amended statement of claim, being the case of the appellants that the respondent was required to meet. It was not for the respondent to chase up the appellants to discover their amended case, and to (apparently) eventually receive it two (2) months late.

36. We note in conclusion that the appellants’ habit of non-compliance with Court orders has extended into their conduct in this Court. In particular, we note that they failed to comply with orders of the Court that parties should file and serve written submissions and extracts of arguments by 29^th April 2022. While it appears that similarly the respondents did not comply with that order, the appeal is that of the appellants.

CONCLUSION

37. The appeal entirely lacks merit. It should be dismissed. The respondent’s costs of and incidental to the appeal should be paid by the appellants, such costs to be taxed if not otherwise agreed.
________________________________________________________________
Pangua Lawyers: Lawyer for Appellants
Akia & Associates assisting Kalip Lawyers: Lawyer for Respondent