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Chief Executive Officer, Telikom PNG Ltd v Minji [2023] PGSC 83; SC2437 (1 August 2023)

SC2437


PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]


SCA NO. 38 OF 2022 (IECMS)


BETWEEN:
CHIEF EXECUTIVE OFFICER TELIKOM PNG LIMITED now known as TELIKOM LIMITED
First Appellant


TELIKOM LIMITED formerly known as TELIKOM PNG LIMITED
Second Appellant


AND:
JOHN MINJI
First Respondent


AND:
INDEPENDENT STATE OF PAPUA NEW GUINEA
Second Respondent


Waigani: Kassman, Geita J, Frank JJ
2023: 26th July & 1st August


APPEAL – practice and procedure - service of notice of appeal – personal service on respondent is mandatory unless service dispensed with or substituted service is ordered.


APPEAL – appeal against the grant of default judgment – failure to give notice of intention to make a claim against the State – effect on the exercise of discretion to grant default judgment.


Cases Cited:
Lokinap v Wagambie [2015] SC1457
Rawa v Trappe (2020) SC2027
Curtain Bros (PNG) Limited v UPNG (2005) SC788
Tohian & The State v Tau Liu (1998) SC566
Agnes Kunton & Ors v John Gurias (2006) SC929
Lambu v Torato (2008) SC953
Bank South Pacific Limited v Robert Tingke (2012) N4901


Legislation Cited:
Constitution s. 37(1), 59(2)
Supreme Court Rules O. 7 r. 13, 14, 15, O. 11 r. 7
National Cour Rules O. 4 r. 49(8)
Claims By and Against The State Act 1996 s. 5


Counsel:
N. Kopunye with M. Worinu, for the First and Second Appellants
No appearances for the First and Second Respondents


DECISION


1st August, 2023


  1. BY THE COURT: This is the court’s decision in this appeal from the judgment of the National Court sitting in Kundiawa dated 15 March 2022 (“the primary judge’s decision”) in proceeding WS No. 1020 of 2019 John Monji -v- Chief Executive Officer, Telikom Limited & Telikom Limited & The Independent State of Papua New Guinea (“the National Court proceeding”).
  2. In this decision the First and Second Appellants are referred to together as “Telikom”, the First Respondent John Minji is referred to as “Minji” and the Second Respondent, The Independent State of Papua New Guinea is referred to as “the State”. On 29 August 2022, Hartshorn J sitting as a single judge of the Supreme Court granted Telikom’s application for stay of the primary judge’s decision and the National Court proceeding pending the hearing and determination of this appeal.

Service of the Notice of Appeal on Minji


  1. At commencement of the hearing of this appeal on 26 July 2023, there was no appearance by or for Minji and neither was there an appearance for the State. Counsel for Telikom said Minji and the State were duly served with the Notice of Appeal filed 8 April 2022 (“NOA”). We return to that below. We have perused the court file. We note Minji has not filed a notice of appearance in this appeal. We also note, the Solicitor-General filed notice of appearance for the State on 18 October 2022.
  2. Counsel for Telikom informed the court Minji has not participated at all at directions, the hearing of the stay application and during listing of this appeal proceeding, both in person or through a lawyer. We confirmed this from our perusal of the court file endorsements that at directions, at the hearing and grant of the stay and when this appeal was set for hearing, there was no appearance by or for Minji. Furthermore, on our perusal of the court file endorsements, we also note the Solicitor-General appeared for the State at directions on a few occasions including on the hearing and grant of the stay orders on 29 August 2022.
  3. Significantly, we note there was no appearance for Minji and the State when the date for hearing of the appeal was first allocated on 6 June 2023 and when the date for hearing of the appeal was confirmed on 17 July 2023 and reconfirmed on 19 July 2023. That explains the absence of a lawyer for the State at the hearing on 26 July 2023. That also explains the absence of Minji or a lawyer for Minji at the hearing of the appeal on 26 July 2023. Most significantly, we needed confirmation that the NOA was duly served on Minji. If the appeal is upheld, the default judgment granted to Minji will be set aside.
  4. Counsel for Telikom referred to various affidavits of service. As to evidence of service on Minji of the NOA, Mr Kopunye handed up in court an unsealed affidavit of Maryanne Timothy, a legal secretary employed by Kopunye Lawyers, which was sworn on 29 August 2022 but not filed. Annexed to that affidavit were copies of the following letters. Annexure “A” was a copy of a letter from Kopunye Lawyers dated 12 April 2022 addressed to “John Minji, Eldim Village, BANZ, Jiwaka Province” purportedly enclosing the NOA and stating settlement of the index to the appeal book will take place at 10am on 4 May 2022 before the Registrar. Annexure “B” was a copy of a letter from Kopunye Lawyers dated 28 April 2022 addressed to “John Minji, PO Box 239, BANZ, Jiwaka Province” purportedly enclosing Telikom’s application for stay and supporting affidavits and stating the date for hearing of the stay application on 19 May 2022. Annexure “C” was a copy of a letter from Kopunye Lawyers dated 19 August 2022 addressed to “John Minji, C/o PO Box 239, MNM Enterprise, BANZ, Jiwaka Province” purportedly stating the hearing of the stay application was adjourned to Monday 29 August 2022 at 9:30am.
  5. In the exercise of our discretion, we accepted this affidavit of Maryanne Timothy sworn on 29 August 2022 on Mr Kopunye assuring the court that it was an oversight on the part of his firm that the affidavit was not formally filed and sealed. However, we are not satisfied the postage of the letter from Kopunye Lawyers dated 12 April 2022 addressed to “John Minji, Eldim Village, BANZ, Jiwaka Province” which purportedly enclosed the NOA can be accepted as due service of the NOA on Minji. Further, we are not satisfied that the letters from Kopunye Lawyers dated 28 April 2022 and 19 August 2022 can be accepted as due service on Minji of the documents purportedly enclosed with those letters and the formal advice of matters stated in those letters.
  6. As to evidence of service on Minji of the appeal book filed 4 November 2022, Mr Kopunye relied on the affidavit of Melisha Worinu, a lawyer employed by Kopunye Lawyers, which was filed on 17 January 2023. Annexure “A” to that affidavit was a copy of a letter from Kopunye Lawyers dated 11 November 2022 addressed to “John Minji, C/o PO Box 239, MNM Enterprise, BANZ, Jiwaka Province” purportedly attaching the appeal book filed 4 November 2022.
  7. As to evidence of service on Minji of the notice of hearing of the appeal filed 12 June 2023, Mr Kopunye relied on the affidavit of Chris David, a legal clerk employed by Kopunye Lawyers, which was filed on 30 June 2023. Annexed to that affidavit were copies of two letters from Kopunye Lawyers. Annexure “A” dated 8 June 2023 addressed to “John Minji, C/o PO Box 239, MNM Enterprise, BANZ, Jiwaka Province” stating the appeal was set for hearing on 26 July 2023 and also stating the directions of the listings judge of 6 June 2023. Annexure “C” dated 16 June 2023 addressed to “John Minji, C/o PO Box 239, MNM Enterprise, BANZ, Jiwaka Province” purportedly attaching sealed copies of the Order of the court of 6 June 2023 and the Notice of Hearing of the appeal filed 12 June 2023 and repeating the orders of the listings judge of 6 June 2023.
  8. While hearing submissions from Mr Kopunye for Telikom, it was clear there were differences in the law or interpretation of the law as to service of a notice of appeal as against the law as to service of any other court document in a Supreme Court proceeding and it was clear counsel needed an opportunity to better assist the court on these issues. In the exercise of our discretion, we then decided to allow Telikom the opportunity to file a submission as to service on Minji by 11am the following day 27 July 2023 and we proceeded to hear submissions on the grounds of appeal. Submissions on the law on service of the NOA were duly delivered which we have considered.

The law as to service of a notice of appeal


  1. Section 37(1) of the Constitution provides “Every person has the right to the full protection of the law...” and section 59(2) of the Constitution provides “The minimum requirement of natural justice is the duty to act fairly and, in principle, to be seen to act fairly.” The right to be heard is a fundamental entitlement to natural justice. “Proper notification to the defendant of the existence of a proceeding is a fundamental principle of natural justice: Annettes v McCann (1990) 170 CLR 596. ... Service of process is effected in the manner stipulated in the rules. Generally, originating process is served on the defendant personally while documents in an interlocutory proceeding are usually properly served at an address for service. If it is not practicable to serve the originating process personally, the court may in its discretion make an order for substituted service. The rules define whether personal service is required. In general, all process and applications to be made to the court must be served ... In actions in personam, service founds the court’s jurisdiction. Laurie v Carroll [1958] HCA 4; (1958) 98 CLR 310; Tuckerman v Neville [1992] 2 Qd R 657 at 661. It will not exercise any of its powers if it has no jurisdiction over the defendant or if it has a doubt about its jurisdiction.” Australian Civil Procedure, Cairns Tenth Edition, The Lawbook Company p.151.
  2. The Supreme Court Rules provide specifically for service of a notice of appeal in Order 7 Rules 13 and 14. Rule 13 states:

“A copy of the notice of appeal shall be served without delay by or on behalf of the appellant on each party – (a) affected by the relief sought by the notice of appeal; or (b) interested in maintaining so much of the judgment as is appealed from; and upon the associate to the primary judge.” Rule 14 states “The Court or a Judge may direct – (a) the notice of appeal be served on any other person; or (b) service on a particular party or person be dispensed with; or (c) service be effected in a particular manner.”


  1. The Supreme Court Rules also provide generally for service of any court document, other than a notice of appeal, in Order 11 Rule 7 which states:

“Where in these rules service is required of any document, it may be effected – (a) by serving a signed and sealed copy of the document personally on the party to be served; or (b) by delivering a signed and sealed copy of the document to – (i) the address for service of a party given in accordance with Division 3; or (ii) the address for service of a party in the proceedings in the National Court from which the present proceedings arose; or (c) where a lawyer of a party has an address for service disclosed, service shall be effected at that address whilst such lawyer continues to act for a party.”


  1. Counsel for Telikom argued there are two Supreme Court authorities on the interpretation and application of Order 7 Rules 13 and Order 11 Rule 7. The issue common to both case authorities was whether the notice of objection to competency was filed within time or within 14 days from service of the NOA as required by Order 7 Rule 15 of the Supreme Court Rules. In both cases, the NOA was not served on the respondent but was served on the lawyer who was acting for the respondent in the proceeding in the National Court.
  2. In Lokinap v. Wagambie [2015] SC1457, the Supreme Court said Order 7 Rule 13 required service on each party to the appeal proceeding and the lawyer was not a party in the appeal proceeding. The Supreme Court said:

“7. Whenever the question of service of a notice of appeal arises, it must be remembered that an appeal to the Supreme Court is a different proceeding from the National Court proceeding. The Supreme Court is the final Court of appeal. It is also a superior Court of record with, amongst other things, its own Court Registry and staff who are responsible for the case management of files: Section 4 of the Supreme Court Act and Order 5 rule 7 of the Supreme Court Rules. It follows that when a notice of appeal which is the document that initiates the appeal is filed, logically, it must be served on the party named as the respondent to the appeal.” and “8. We are of the view that Order 11, rule 7(c) relied on by the appellants has limited application in so far as the question of service of a notice of appeal is concerned because the question of service is adequately addressed in rule 13. Rule 13 states that a notice of appeal must be served on each party to the appeal. It does not state that it may be served on the lawyers for each party.”


  1. In Rawa v Trappe [2020] SC2027, the Supreme Court said:

“12. In our view the SCR and in particular, Orders 7 and 11, should be read together. Order 7 Rule 13 states that a sealed copy of a notice of appeal shall be served on each party or persons that are affected by the relief sought that is or are the subject of the appeal. Two notable remarks we make of Order 7 Rule 13, are, (i), it does not expressly say that personal service is required, and (ii), it does not provide the mode(s) of serve of a notice of appeal.” and “13. The modes of service of a notice of appeal, in our view, are prescribed under Order 11. And Order 11, in our view, and as expressly stated, generally applies to all the provisions of the SCR including Order 7. The rule, in our view, in fact provides express modes of how a notice of appeal may be served under Order 7. A notice of appeal that is required to be served on a party or person under Order 7 Rule 13, may be served by, (i) personal service, or (ii), service through the address for service of the parties affected including through their address for service as pleaded in the National Court proceedings where the appeal has arisen from, or (iii), service through their lawyers who had acted for them in the National Court proceeding where the appeal has arisen from, provided the lawyers continue to act for the party or parties in the matter. In the practical sense, what Order 11 Rule 7(c) means is that in a case where parties have lawyers who acted for them in the National Court, the party that is appealing, to effect service of a notice of appeal under Order 11 Rule 7(c), must first of all get confirmation from the lawyers of the respondent that they still act for their client in the matter. Confirmation, in our view, may either be express or by conduct.”


  1. With respect, we follow the reasoning in Lokinap. The NOA is an originating process which commences the proceeding in the Supreme Court and Order 7 Rule 13 specifically provides for service of the NOA and it is in mandatory terms “... the notice of appeal shall be served ... on each party” Further, Rule 14(b) provides for dispensation with service and Rule 14(c) provides for substituted service.
  2. In this case, Telikom was obliged to serve Minji with the NOA. The NOA is an originating process and had to be served personally on Minji. If personal service proved difficult, Telikom should have applied for substituted service, the most common method being by publication in a newspaper. Service of the NOA by post to Minji was not authorised by the Supreme Court Rules nor was it authorised by an order of the court.
  3. At the hearing, we heard Telikom’s submissions on the grounds of appeal. There was no appearance for Minji and the State. We are satisfied we can determine the grounds of appeal without hearing from Minji and the State as the errors are apparent from the records contained in the Appeal Book.
  4. Minji was aware and thus accepted, as the trial court had correctly found, that he was required to give a section 5 notice before instituting the National Court proceeding. The error of the trial court concerned the relevance of Minji’s failure to give the section 5 notice to the exercise of the trial court’s discretion on whether to grant default judgment which is a question of law in respect of which we have considered the option of allowing Minji the opportunity to address the Court on the appeal, however, as he has not shown any interest in the appeal despite being served with Telikom’s application for stay, we have proceeded to determine this appeal.

Pleadings in the National Court proceeding


  1. In the National Court proceeding, Minji in a writ of summons filed 25 August 2019, claimed he was the owner of customary land which the Telikom (through its predecessor entity) and the State trespassed and installed telephone cables and underground cables without his permission. Minji claims the underground cables are still being used by Telikom and the State who have constantly ignored his demands for compensation for the trespass to his land and for their use of his land by Telikom and the State. Minji claims the sum of K2,352,000.00 plus special and general damages, interest and costs.
  2. Minji also claimed he had served his notice of intention to claim pursuant to section 5 of the Claims By and Against the State Act 1996 on Telikom and the State in person at the head office of Telikom “at Rumana Building Waigani on 17/04/2015).” It is apparent from the records that Telikom and the State failed to file a notice of intention to defend, Telikom filed its Defence on 15 October 2019 and the State failed to file a defence.

Default judgment


  1. On 13 February 2020, Minji filed a notice of motion seeking default judgment on the basis that Telikom and the State had failed to file their defence. On 17 March 2021, Telikom filed a notice of motion seeking orders to dismiss Minji’s notice of motion for procedural irregularities, to strike out Minji’s proceeding for want of particulars of representation and alternatively for dismissal of the proceeding on the basis that the proceeding was time-barred. Both motions filed by Minji and by Telikom were heard on 17 August 2021. On 15 March 2022, the trial court granted Minji’s application when it ordered that default judgment be entered and that damages be assessed.

Grounds of Appeal


  1. Being aggrieved with the primary judge’s decision, Telikom filed this appeal on 8 April 2022 and raised three grounds of appeal which we recite in full.
  2. The grant of default judgment is an exercise of discretion. To challenge the exercise of that discretion, it must be shown, in line with authorities such as Curtain Bros (PNG) Limited v UPNG (2005) SC788, either that - (1) an identifiable error has been committed by the trial judge because he either: (a) acted upon a wrong principle; (b) allowed extraneous or irrelevant matters to guide or affect him; (c) mistook the facts; (d) did not take into account some material consideration, or (2) where no error is apparent, the resulting judgment or order is so unreasonable or plainly unjust that an error in the exercise of that discretion can be inferred.
  3. As the competency of the National Court proceeding raised in Ground (III) of the notice of appeal (para 24 above) can determine the outcome of this appeal, we will consider this ground first. Telikom submits in this appeal as it did in its written submissions before the National Court, that as Telikom is an entity of the State, it is the ‘State’ within the meaning of section 5 of the Claims Act. This was also the position which Minji took before he filed the National Court proceeding, evident from his letter to Telikom which he said was his section 5 notice.
  4. In the primary judge’s decision, the court found that Minji had failed to give section 5 notice saying “Service of section 5 Notice to the first defendant at its head office at Telikom Rumana is not service pursuant to Claims By and Against the State Act which requires service to be made on the Solicitor General.” Although the court referred to Telikom’s submission and correctly held that service of a section 5 notice cannot be effected on Telikom, it is not clear from the court’s reasons for judgment that he determined that Telikom is the State for the purpose of section 5 of the Claims Act. Therefore, the issue as to whether Telikom is the ‘State’ within the meaning of section 5 of the Claims Act remains a live issue.
  5. With respect to the State, it is trite that before a claim can be instituted, a section 5 notice must be given of the claim to either officer specified in section 5 (1) of the Claims Act: Tohian & The State v Tau Liu (1998) SC566. This was common ground between the parties and the trial court found that the Minji had failed to give the requisite section 5 notice to the State. As a section 5 notice is a condition precedent to the institution of a proceeding before the Court to enforce a claim (Tohian v Tau Liu (supra), the consequence of not satisfying it in this instance is that the National Court proceeding against the State is incompetent.
  6. Where a defendant defaults in filing its notice of intention to defend, it does not follow that default judgment must be granted on that basis alone; it remains in the discretion of the trial judge whether judgment should be granted: Agnes Kunton & Ors v John Gurias (2006) SC929; Lambu v Torato (2008) SC953. Factors which may influence the exercise of that discretion might include matters such as those listed in caselaw such as Agnes Kunton & Ors v John Gurias (supra) and Bank South Pacific Limited v Robert Tingke (2012) N4901, which include a consideration as to whether a condition precedent such as a notice of intention to make a claim against the State has been met.
  7. Against such considerations, it can be observed that the failure to file a notice of intention to defend is but one of many considerations which may influence the exercise of that discretion. Thus, the requirement to give a section 5 notice was a material consideration which the trial court accepted that Minji had failed to satisfy. However, it is apparent from the reasons for judgment that His Honour did not give due consideration to it when, in determining the motions, he made the orders under appeal.
  8. In para 8 of his reasons for judgment, the trial court also said, “... Secondly in filing its Notice of Motion it failed to invoke the court’s jurisdiction.” This is evident on the face of Minji’s notice of motion which, in breach of Order 4 rule 49 (8) of the National Court Rules, did not plead the jurisdictional basis of the relief sought in it. The result of this is that Minji’s notice of motion was incompetent. Therefore, the effect of these findings of the trial court were fatal to the competency of Minji’s notice of motion and the National Court proceeding as against the State. Despite these findings, the trial court acted on Minji’s notice of motion and granted Minji’s application for default judgment. In the result, the trial court fell into error. For these reasons, we uphold Ground (III).
  9. Given this outcome, it is not necessary to consider and determine the other grounds of appeal. In this circumstance and given that service of a section 5 notice is a threshold issue and Minji was aware of that requirement before he instituted the National Court proceeding, we have determined this appeal on that issue.
  10. Ordinarily, costs follow the event and Telikom would be entitled to its costs of the appeal but in the exercise of our discretion, Telikom will bear its own costs of the appeal as Telikom failed to duly serve the NOA on Minji. No order as to costs was made by the trial judge. As Telikom and the State had defaulted in filing their notices of intention to defend, this compelled Minji to file for default judgment. Telikom could have invoked Order 7 rule 8 (a) of the National Court Rules and raised non- compliance with section 5 of the Claims Act as the ground but it did not. In any event, its motion was refused. For these reasons, each party in the National Court proceeding should bear its own costs of the motions.
  11. The formal orders we make are that:
  12. We leave the matter with this observation. As Minji was not present and did not participate at the hearing of this appeal, in fairness to him, he should have the opportunity with the participation of Telikom to address, at or prior to trial, the following issues:
    1. the application of section 5 of the Claims Act By & Against the State Act to Telikom, and subject to that issue,
    2. ownership of the land the subject of the proceeding; and
    3. the capacity in which Minji instituted the National Court proceeding; and
    4. the naming or inclusion of the first defendant in the National Court proceeding.

Judgment and orders accordingly:


Kopunye Lawyers: Lawyers for the Appellant
Lawyers for the Respondents: Nil


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