Gene v Wereh [2023] PGSC 127; SC2476 (28 September 2023)

SC2476

PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]

SCA 74 OF 2019

BETWEEN:
MENEVI GENE
First Appellant

AND:
LANDMARK VALUERS
& CONSULTANTS
Second Appellant

AND:

DAVID WEREH
in his capacity as the Acting Secretary
for the Department of Works and Supply
First Respondent

AND:
THE INDEPENDENT STATE OF
PAPUA NEW GUINEA
Second Respondent

Waigani: Gavara Nanu J, Hartshorn J, Tusais J
2023: 25^th & 28^th September

SUPREME COURT – Appeal – dismissal of proceedings by the primary judge on the basis that the s. 5 notice was served outside of the required 6 months period from the date of the accruing of the cause of action – appeal dismissed

Cases Cited:
CMSS (PNG) Ltd v. State (2014) N5717
Joseph v. Rami (2021) SC2138

Counsel:

Mr. J. Napu, for the Appellants
Mr. E. Bua, for the Respondents

28^th September 2023

1. BY THE COURT: This is a decision on a contested appeal against a decision of a National Court (decision appealed). The decision appealed resulted in the dismissal of a proceeding for failure to issue a valid notice pursuant to s. 5 Claims By and Against the State Act (Claims Act)

Background

2. The plaintiffs now appellants, commenced a proceeding in the National Court seeking from the respondents the remainder owing for valuation services provided by the appellants pursuant to eleven pro forma contracts. In the course of the trial, the primary judge determined that the question of whether s. 5 Claims Act had been complied with by the appellants must be addressed and disposed of first. After hearing the parties on this issue, the primary judge delivered the decision appealed.

3. The appellants appeal the decision appealed on numerous grounds.

Consideration

4. The decision appealed is the decision of the primary judge dated 23^rd April 2019. That decision is stated in the Order taken out by the appellants. It is stated as:

“The Plaintiff’s case is liable to be dismissed on account of failure to issue a valid Section 5 Notice and it is ordered with costs.”

5. At line 30 p2064 Appeal Book Vol 6, the transcript of the hearing held on 23^rd April 2019 reads:

“I am of the clear and considered opinion that in this case there was no valid section 5 notice that was issued having regard to the pleadings, the common cause facts per pleadings and having regard to the evidence that was placed before me and without that being proven, no litigation against the State can be continued. In the result, the plaintiff’s case is liable to be dismissed on account of failure to issue a valid section 5 notice and I so order with costs. That is my judgment.”

6. In the grounds of appeal, the appellants take issue with amongst others, the primary judge dismissing the National Court proceedings on the basis that the s. 5 notice was served outside of the required 6 months period from the date of the accruing of the cause of action.

7. Nowhere in the grounds of appeal do the appellants take issue with or challenge the primary judge’s decision and reason for decision which is that there was a failure to issue a valid s. 5 notice. This is notwithstanding that the primary judge did not decide that the proceeding was dismissed because the s. 5 notice was served outside of the required six months period. The primary judge dismissed the proceeding on the basis that there was a failure to issue a valid s. 5 notice.

8. As the appellants do not take issue with or challenge the decision or reasons for decision of the primary judge in their grounds of appeal, the decision appealed is without proper challenge and this appeal should be dismissed.

9. If however, the decision appealed is not dismissed as referred to, we consider whether the primary judge would have been entitled to dismiss the proceeding on the basis that the s. 5 notice was given out of time.

10. The appellants contend that such a finding should not have been made as the respondents had not pleaded in their defence a reference point or cut-off date from when the requisite six months was to be calculated. We assume that the reference date or cut-off point is the date referred to in s. 5(2) Claims Act which is “the occurrence out of which the claim arose”.

11. That the respondents did not plead the date which they contended was the occurrence out of which the claim arose is not fatal to their defence. It was sufficient for the respondents to plead in their defence that the s.5 notice was issued out of time. It was then for the appellants to prove on the balance of probabilities that the s. 5 notice was not filed out of time: Joseph v. Rami (2021) SC2138 at [19].

12. Further, evidence filed by the respondents in the National Court included the affidavit of Jonathan Saka. Annexure “D” of that affidavit is one of the contracts the subject of the proceeding. Clause 1.1 of the Conditions of Contract provides amongst others, for payment by the Employer (the State) within 28 days upon receipt of an interim payment certificate. On the basis that payment was to be made within 28 days of receipt of an interim payment certificate, it may be assumed that if the subject payment was not made within the period of 28 days, then the 29^th day is the date of the occurrence out of which the claim arose.

13. It is pleaded in the appellants amended statement of claim that the relevant work performed by them was completed, signed and delivered in September 2010. It is reasonable to assume that the appellants rendered invoices then for the full amount claimed given that certain payments were made by the respondents as pleaded, up to 14^th February 2012. The appellants further pleaded that the s. 5 notice was given on 20^th May 2013. Even if the occurrence out of which the claim arose is taken as being 14^th February 2012 and it is likely to have occurred earlier, clearly the s. 5 notice was given more than six months after the occurrence out of which the claim arose. Given this, we are satisfied that it was open for the primary judge to make a finding that the s. 5 notice was given out of time on the pleadings and evidence before him.

14. The appellants contend however, that their cause of action was recurrent on the basis that the respondents made part payments only and did not indicate to the appellants that further payments would not be made. The appellants could not cite any authority in support of this contention.

15. In CMSS (PNG) Ltd v. State (2014) N5717 at [19], Hartshorn J said:

“19. As to the argument of CMSS that as the breach of clause 2.3 is continuing and so the CMSS s.5 notice was given in time, as I said in Peter Komba v. National Capital District Commission (2007) Unreported, WS 451/07, Waigani, delivered 26/7/07, as to a contention that a continued outstanding payment constituted a continuing cause of action and so a s. 5 notice could be given at any time:

“This contention is not correct. The cause of action or the “occurrence out of which the claim arose” is when the event first happened. The question to be posed is, when did the money begin to be owed or when was it that the breach occurred?” “

16. Consequently, we find no merit in the contention of the appellants on this point.

17. The appellants also contend that as the s. 5 notice issue was a jurisdictional issue, the respondent should have raised it earlier by a notice of motion. That such a notice of motion seeking to raise a jurisdictional issue may be moved before trial is without question, but it is not a mandatory requirement for that to occur. The respondents were entitled to raise the issue at trial. It was the primary judge who decided to hear the jurisdictional issue as a preliminary issue. He was entitled to adopt this course: Joseph v. Rami (supra) at [16]. There is no merit in this contention of the appellants.

18. The appellants further contend that the State has a duty to reply to a person who has given a purported notice pursuant to s. 5 Claims Act as to whether the purported notice has been given out of time. No such duty is imposed upon the State in the Claims Act. This Court does not have the power to amend the statute so that such a duty is imposed.

19. In any event, in this instance the State in its defence in 2013 pleaded that the s.5 notice was given out of time. The appellants and their lawyer were therefore on notice of the position of the State. The appellants could have considered discontinuing the National Court proceeding and then making an application for an extension of time to give a s. 5 notice.

20. For all of the above reasons, this appeal should be dismissed. Given this it is not necessary to consider the other submissions of counsel.

Orders

a) This appeal is dismissed.

b) The appellants shall pay the costs of both respondents of and incidental to this appeal to be taxed if not otherwise agreed.
__________________________________________________________________
Napu and Company Lawyers: Lawyers for the Appellants
Solicitor General: Lawyers for the Respondents