Dekenai Constructions Ltd v Seeto [2025] PGSC 25; SC2714 (25 March 2025)

SC2714

PAPUA NEW GUINEA
[SUPREME COURT OF JUSTICE]

SCA NO 52 OF 2023

BETWEEN:
DEKENAI CONSTRUCTIONS LIMITED
Appellant

V

NICOLE SEETO for and on behalf of Agnes Seeto
Respondent

WAIGANI: PITPIT J, NAROKOBI J, ELIAKIM J
31 JULY 2024; 25 MARCH 2025

SUBSTANTIVE APPEAL – civil – tort of trespass - appeal against liability and quantum – considerations – elements of trespass – uncontested and uncorroborated evidence - whether the Court below erred in finding that the contract between the appellant and the state for road works was irrelevant to the respondents claim – whether trial judge erred in the exercise of his discretion in the determination of assessment of damages

Cases cited
Madaha Resena & Ors v. The Independent State of Papua New Guinea [1990] PNGLR 22
Bob v Stettin Bay Lumber Company Ltd (2008) N3440
Rimbunan Hijau v Ina Enei & ors (2017) SC1605
Covec (PNG) Ltd v Kama [2020] SC1912

Counsel
N. Pilamb for the appellant
G. Kogora for the respondent

1. BY THE COURT: This was an appeal against the final decision of the National Court in Waigani made on 27 March 2023 in proceeding WS No. 432 of 2017. The appellants were defendants and the respondent plaintiff in the Court below. The appeal is against both liability and quantum.
   
2. Based on the writ of summons and statement of claim filed on 05 May 2017, the respondent claimed damages for trespass to her property described as Portion 352, Milinch of Kieta, Fourmil of Bougainville South contained in the Certificate of Title Volume 27, Folio 237 (‘the property’).
   
3. She claimed that on or about September/ October 2016 the appellant had intentionally and directly entered the property as part of the road construction operation, without her consent. This issue was brought to the attention of the appellant’s site manager Graham McKillop on 18 August 2016 who accompanied the respondent and her husband to the site and had admitted to the encroachment. The encroachment resulted in the appellant destroying the vegetation and soil composition of the property.
   
4. The appellants denied the claim. They alleged that they were authorized under its contract dated 13 October 2015, with the State through the Department of Works, for road construction and upgrade of the Aropa to Kieta road (‘the Contract’). They claim to have entered the approximate area claimed, with no prior knowledge of the respondent’s ownership over the property. They also alleged that their community liaison officer Severiuis Dupansi had carried out clearance work with the customary landowners, prior to the project commencing. (‘the project’).
   
5. Trial was on both liability and quantum. Court’s final decision was delivered on 27 March 2023 which was:
   
   1. “Judgment is entered for the Plaintiff in the sum of K505,475 comprising:
      

(a) assessed general damages K408,975

(b) pre-judgment interest at 45 per annum
On assessed damages K 96,500

Total of Judgement: K505,475

2. Post-judgement interest shall accrue in the rate of 4% per annum on so much of the above assessed damages of K408,975 as remains from time to time unpaid.
   
3. The Defendant shall pay to the Plaintiff:
   

(a) the Plaintiff’s cost of and incidental to this proceeding on a party/party basis, and

(b) that amount as represents all reasonable fees and disbursements invoiced by valuer Mr. William Ovasuru to the Plaintiff for his valuation report and his attendance in connection with this suit,

such costs and valuer’s invoiced amount to be taxed if not agreed.

4. The time for entry of this judgment is abridged to the time of signing of the Court which shall take place forthwith.”
   
6. Aggrieved by this decision, the defendant filed this appeal.
   

GROUNDS OF APPEAL

7. The appellants raised 11 grounds of appeal, contained in their Notice of Appeal filed 06 May 2023.
   
8. Grounds 3(A) to (E) address liability and grounds 3(F) to (K) address quantum. For purposes of the appeal before us, we categorize the grounds of appeal on liability into ‘the Contract’ and ‘Tort on Trespass’.

1. LIABILITY
   

Error of Fact and Law – The Contract

9. Regarding the grounds addressing liability, the appellant’s main argument is that the primary judge erred in both fact and law by determining that the appellant’s contract with the state, made on 13 October 2015 through the Department of Works, was irrelevant to the respondent’s claim based on the tort of trespass. The appellant pleaded in its defence at the lower court and continue with its assertion in this appeal that it had lawful authority under the contract. It claims:-
   
   • (a) to enter the property located within the 40 meter corridor;
     

(b) that it is not responsible for any compensation to landowners for damages due to roadworks within the 40 meter corridor.

10. In relation to the issue of encroachment, the appellant although does not dispute the respondent’s ownership over the property, claims that any purported encroachment on its part onto the respondent’s property was lawfully authorized under clause 18.1 of the Contract.
    
11. The trial judge after reviewing the evidence before him, disagreed with the parties’ statement highlighting the contractual relationship between Dekenai Constructions Limited and the State as being the first two main issues for trial. His honor considered these issues to be irrelevant to the respondent’s cause of action which is founded on the tort of trespass. The reasons being that the respondent is not a party to the contract, the respondent has not sued the state and that the State is not a party to the proceedings.
    
12. We find there is no error in the trial judge’s finding that the contractual relationship between the appellant and the State was irrelevant so far as the respondent’s cause of action on trespass is concerned. This then resolves the ground of appeal #3A.
    

Error of Fact and Law – Tort on Trespass

13. Grounds 3(B) to (E) relate to the tort on trespass.
    
14. We agree with the trial judge’s adoption and application of principles to be proven in a cause of action founded on tort of trespass. Cannings J in the case Bob v Stettin Bay Lumber Company Ltd (2008) N3440 provides:
    

“To succeed in an action for trespass to land, a plaintiff must prove five things:

(a) That the defendant entered the land, either directly (in person) or indirectly (eg. By propelling an objection or third party onto the land); and

(b) That the defendant did so by some intentional act;

(c) That the defendant had no lawful authority;

(d) That the plaintiff was in lawful possession of the land; and

(e) That the plaintiff’s enjoyment of the land was interfered with.”

15. The appellant asserted in its submissions that the trial judge erred in the following four instances when determining the above principles. We will deal with each one of them separately:
    
    • (a) Insufficient evidence that road works was done outside the allowable 40 meter corridor.
      • Whether or not the road works is within the 40 meter corridor is irrelevant to the respondent’s claim. Moreover, the 40 meter corridor is a term of a contract which the respondent was never a party to.

(b) That the purported trespass constituted negligence rather than intentional.

• The undisputed evidence of Jamie Mitchell, the appellant’s general manager, was that its Community Liaison Officer one Severius Dupansi had done prior clearance work along the project area. Further, he had approached the relevant landowners and obtained permission from the paramount chief, Thomas Wukaia, prior to commencement of the project. We note that neither Mr. Dupansi nor paramount chief Wukaia gave evidence at trial.
  

One of the respondent’s witnesses, Scott Ryans deposed to evidence of the appellant’s initial discussions with the appellant’s Graham McKillop and Mr. Dupansi, at the appellant’s office on 18 August 2016. When questioned by Mr. McKillop and the respondent, Mr. Dupansi confirmed being aware of the land in issue and that it was owned by the respondent’s family. It was therefore not unreasonable for the primary judge, on the evidence before him, to conclude that Mr. Dupansi had constructive knowledge of the respondent’s ownership over the land encroached on.

This information would obviously had been exposed during Mr. Dupansi’s due diligence work. As such, the appellant would have known that their actions would result in a wrong. The trial judge was therefore correct in concluding that the appellant’s action was intentional.

(c) The appellant had lawful authority under the contract to purportedly encroach portion of the property.

• The appellant may have lawful authority under its contract with the state to construct a 40 meter road corridor. This however does not give the appellant license to encroach or unlawfully trespass onto a 3^rd party’s property without its consent and authority. There was therefore no misrepresentation of the law and the primary judge was correct in his finding.
  

(d) That the respondent’s enjoyment of the land was interfered with.

• The plaintiff’s uncontested evidence was that the appellant had encroached onto 23m² of her property. The trial judge was therefore correct in his finding in that regard.
  

16. There is no dispute that the respondent is the registered title holder of the property described as Portion 352, Milinch of Kieta, Fourmil of Bougainville South. Overwhelming evidence proving that the construction road works had encroached into 23m² of her property. Without the authority or consent of the registered owner, any access by a third party can be deemed unlawful entry and thus, trespass to property.
    
17. In our view, the trial judge had correctly considered the elements of trespass and properly applied the facts of the case. We therefore find no error committed by the trial Judge in this regard and uphold his findings and conclusion on liability.
    
    2. GROUNDS 3(f) to (l) – ASSESSMENT
       
18. Having found that the trial judge was correct in finding trespass against the appellants, we now consider how his honor considered his assessment of damages.
    
19. Appeal Grounds 3(f) to (k) relate to assessment of damages, we note grounds 3(f) to (k) which are contained at page 7 to 11 of the appeal book. In summary, the appellant claims that the trial judge erred in law or in fact when: -
    
    • (f) When he gave credible weight to findings of Mr. Ovasuru contained in his Valuation Report. Appellant claims the report was defective in that Mr. Ovasuru was only qualified to assess value of 23m² of her property which he did in the amount of K50,600.00. Further, he was not qualified to make findings of environmental disturbance to the amount of K548,870.00. Secondly, that the primary judge had found as a fact that there was no evidence that the surfaces soil had been permanently damaged and that the property was now prone to flooding due to appellant’s conduct.
      
    • (g) He misapprehended the purpose of assessment of damages, which is to restore the plaintiff as best as money can to the position he or she would have been, had it not been for the tortious actions complained of (Rimbunan Hijau (PNG) Ltd v Ina Enei & ors (2017) SC1605). The appellant claims that the only damage suffered was the loss of 23m² of her property which the trial judge was obligate to confine his assessment to. Further that there was no evidence adduced of permanent damage.
      
    • (h) Considering the trial judge’s ruling at paragraph 114 that there was no evidence adduced on remediation, his reasoning was flawed when he found at paragraph 115 that the court must endeavor to do its best with whatever evidence before it and proceeded with assessing damages. It was flawed in that remediation was neither pleaded nor supported with evidence.
      
    • (i) When at paragraph 120, the trial judge ruled that compensation should be half of what Mr. Ovasuru assessed in his Valuation Report under the heading ‘Disturbance’.
      
    • (j) When the trial judge drew an inference, without any evidence adduced, awarded K75,000 for costs and expenses associated with registration of updated survey plan and replacement certificate of title.
      
    • (k) He erred in assessing damages under ‘Disturbance’ when the four categories of disturbance were not pleaded and had no basis in his finding on liability.
      

CONSIDERATION ON ASSESSMENT

20. For purposes of assessment to damages for trespass, the trial judge rightly focused on the valuation reports tendered into evidence.
    
21. Regarding the damage to the property that resulted in a decrease in the land’s value, the appellant does not contest the K48,300 awarded for the value of the land that was encroached upon.
    
22. The second, and arguably most disputed, damage awarded by the trial judge was for environmental damage to the property. The respondent relied on the evidence of registered valuer William Ovasusru, who conducted physical site inspections to generate his valuation report dated 07 September 2018. In response, the appellant enlisted the services of valuer Kaluwin Potuan whose report is dated 18 November 2018.
    
23. A key distinction between the two valuation reports, as highlighted by the trial judge was that Mr. Potuan did not conduct a physical site inspection, instead, he relied on hearsay information or data to generate his report. Therefore, the trial judge was correct in concluding that Mr. Potuan’s denial of any environmental damage to the property carried little to no evidentiary weight. Further, that he was in no position to assert that there was no evidence of environmental damage that could have had an adverse effect on the value of the property.
    
24. In our view, given the absence of expert evidence to challenge Mr. Ovasuru’s valuation report on the environmental damage and adverse effect to the property, and also considering his qualifications, it was reasonable for the trial judge to place significant weight on his evidence. All things considered, the appellant having been found liable for trespass, must compensate the rightful owners of the property. The amount to be paid by the trespasser is primarily determined by the negative impact on the physical environment it had encroached upon.
    
25. We do note that the trial judge, in his deliberation, did consider the principles held in the Rimbunan Hijau case which held: -
    

“We agree that, the principle generally is to restore a plaintiff though not exactly to the same position but, as best as money can, to the position he or she would have been had it not been for a defendant’s tortious action. Assessing damages is not matter of mathematical or scientific precision. It however, requires a careful consideration and weighing of all evidence presented before the Court and Court arrives at an award it considers will best compensate a plaintiff who suffers loss or damage on account of a defendant’s tortious actions.” (Rimbunan Hijau (PNGH) Ltd v Enei (2017) SC1605).

26. In the present case, the trial judge was presented with overwhelming evidence that the original condition of the 23m² of land had been altered with its natural habitat, vegetation and other natural features lost. The trial judge considered the respondent’s unchallenged evidence that the appellant’s intentional act disrupted the soil surface, destroyed and removed the family’s fruit trees that had been cultivated for over 20 years, discarded trees and vegetation, resulting in uncultivated savannah grassland; and caused the relocation of relic crane an asset to the family’s engineering business that had been operating prior to the Bougainville crisis, and held special value to the respondent’s family. The trial judge was therefore reasonable in determining that the damage suffered by the respondent far exceeded the price per square meter.
    
27. The trial judge also correctly noted in his decision that the appellant’s trespass occurred on multiple occasions, beginning in November 2015.
    
28. Based on the evidence presented, the trial judge found that the property had suffered multiple damages, including the allegation of flood-prone effects and long term environmental harm. However, the trial judge found the flooding aspect unproven and rejected the ‘before’ and ‘after’ methodology used by Mr. Ovasuru in arriving at his assessment of K548,870. Nevertheless, his honor found the other alleged damages to be adequately proven.
    
29. In this case, there was compelling evidence before the trial judge showing the changes to the natural habitat that impacted the respondent’s personal interests, including the loss of family enjoyment from the destroyed fruit trees and the sentimental value of the relic crane, among other things. As the current state of the property cannot be restored to its original condition, remediation must take place. In other words, this next step is directly tied to the damage that has been caused.
    
30. Therefore, the first step in the environmental remediation process is the collection of data through the assessment and evaluation of the site in question. This process helps identify potential risks, followed by the creation of a cleanup plan, among other steps. Successful remediation requires both time and resources, including financial investment. The trial judge correctly incorporated this aspect into the general damages, meaning it need not be separately pleaded, as the appellant suggested. Additionally, the 'disturbances' highlighted by the registered valuer in his report were also considered in assessing damages and similarly do not need to be separately pleaded. In our view, there was no flaw in the trial judge’s findings.
    
31. Hence, considering the case laws referenced by the trial judge in his decision, and the evidence before him, we believe that his assessment of K408,975.00 in general damages is reasonable under the circumstances.
    
32. We find that the trial judge did not err in law and or fact in the exercise of his discretion.
    

SUMMARY

33. In summary, we dismiss all the grounds of appeal, namely, grounds 3(A) to 3(K) of the appeal.

34. In regard to cost, we order that costs follow the event, to be taxed if not agreed.

ORDERS OF THE COURT:

35. We make the following orders:

1. The appeal is dismissed.
   
2. The orders of the National Court are confirmed.
   
3. Costs follow the event, to be taxed if not agreed.
   

The Court orders accordingly.
________________________________________________________________
Lawyers for the appellants: Mel & Henry Lawyers
Lawyers for the respondent: Henaos Lawyers