Dept ordered to pay firm K880,000 for breach of contract

The National National

By HEZRON KISING
The Waigani National Court has ordered the Department of Transport and the State to pay more than K880,000 in damages to a company for breach of contract in 2015.
Judge Derek Hartshorn ordered Roy Mumu, as the secretary for the Department of Transport in 2015 and the first defendant, and the Independent State of Papua New Guinea, as third defendant, pay K880,699.70 to Chin Investment Ltd (CIL), the plaintiff in the matter.
The court heard that on March 15, 2015, CIL, DOT and the projects co-ordination unit, the second defendant on behalf of the State, entered into a commercial lease agreement for Bay 7, Level 2 of the plaintiff’s building known as CHM Corporate Park One at Gordon in Port Moresby. The coordination unit within the DOT was to lease the premises for three years, ending on March 14, 2018. The lease was terminated by Garry Hersey as the director for MPCU on Dec 18, 2015.
DOT made payments of K261,560.95 consisting of rental deposit of K85,520 and rentals to the end of Sept 2015 for the sum of K176,040.95. Rentals were not paid for the last quarter of 2015 and the remainder of the lease.
The court was told that the plaintiff submitted that from a perusal of the statement of claim, it was accepted as proven, that:

  • The defendants terminated the lease on December 18, 2015, and the plaintiff was entitled to recover damages against the defendants;
  • the defendants had not paid the rentals for the last quarter of 2015 being the sum of K80,520 and this remained outstanding;
  • the defendants did not pay any further rent or outlays for the balance of the term of the lease from January 2016 to March 14, 2018, when the lease expired, with defendants liable to pay a total sum of K785,539.70; and,
  • Interest.

The court relied on the evidence of CIL operations manager Joselito Tubo that the parties entered into an agreement.