THE COURT REPORT
Rent arrears stacked up while Paraka ran for Parliament
In 2017, controversial lawyer Paul Paraka, tried to wrest control of the National Capital District from the incumbent governor, Powes Pakop, by contesting the NCD regional seat in the National election.
Meanwhile, unbeknown to voters, Paraka was running up a huge debt in unpaid rents for his legal offices in downtown Port Moresby.
Paraka’s landlord, Nambawan Super Limited, is PNG’s largest superannuation provider; so it was ordinary workers retirement funds that were ultimately suffering the loss.
Paraka’s name of course never seems to be out the headlines for very long.
Whether it is multi-million kina government contracts, allegations of fraud, criminal charges that never seem to stick, launching his own political party, or a failed election campaign, the media is usually there to report; the issue of the unpaid rent though, seems to have escaped attention.
This is despite Nambawan Super Limited having recently obtained a default judgement against Paraka for more than K2.5 million. The final bill could be much higher once interest and legal costs are added.
Here is the history of the matter.
Paraka Lawyers was a long-standing tenant of the Mogoru Moto building in downtown Port Moresby which was owned by Nambawan Super Limited.
There were various disputes over the rents and charges for the use of the building and other properties rented to Paraka. These included unpaid charges of K3,448,840 for the period between 2004 and 2010 and a further K2,254,447 for the period from 2010 – 2013.
These disputes appeared to be resolved in March 2016, when the parties signed a deed whereby they each agreed to give up their past claims and objections and Paraka agreed to pay rental arrears of K373,423 and to resume paying the monthly rental from 1 April.
That however was not the end of the matter. Paraka failed to pay the agreed amount of arrears and failed to pay the ongoing rent from 1 April.
In December 2016, Nambawan Super cancelled the lease and commenced legal proceedings for the outstanding sum of K2,626,425 plus damages, interest and costs. This Paraka claims, was extremely distressing for him:
It was difficult to bear the thought of being evicted and locked out from a premises that I commenced my legal career for over twenty-two (22) years ago in 1994, and had been part of my life, and such thought affected my state of mind.
Indeed, Paraka was so distressed, by August 2017, he had still not filed any defence to the claim and Nambawan Super applied to the court for a summary or default judgement. Paraka responded by applying for leave to file his defence out of time and file a cross-claim.
In considering the two applications, the court noted that Paraka’s defence should have been filed in the first instance by 16 March 2017. This was 5 months and 9 days before Paraka applied to the court for leave to file out of time.
In the interim period Paraka had twice asked for, and Nambawan had granted him, extensions of time to file his defence. The first extension was to 30 May and the second to 16 June. Paraka did not meet either deadline, and asked instead for a third extension.
Nambawan Super wrote to Paraka on 21 June, denying his request for any further extension of time. Paraka then delayed for a further 2 months and 9 days before he filed his extension request with the court.
Paraka told the court the delay was partly as a result of his election campaigning:
The month of June and July were peak period during the election campaign, and at our campaign headquarters distraction was part of the chaotic situation, I couldn’t find the peace to undertake the preparation of the Defence.
He had also been busy, he claimed, preparing for two trials set down for hearing in August.
Justice Anis was unimpressed with these excuses, finding neither to be ‘reasonable or valid’. The judge noted that Paraka had in total delayed for over 6 months in filing his defence and had instead ‘decided to use the time to do things that are unrelated to the proceedings’ i.e. mounting an election campaign.
Indeed, Paraka had acted in ‘bad-faith’ said the judge, as he had twice sought and been granted an extension of time by the plaintiff on the understanding that he would use that time to file his defence but had instead, by his own admission, chosen to use the time to go off and do other things.
The judge also found that Paraka had not established any defence ‘on merit’ against the plaintiff’s claim for unpaid arrears.
Paraka tried to claim that Nambawan Super had used “unfair tactics” to secure the deed of agreement he signed in 2013.
This was dismissed by the judge. He noted Paraka was a lawyer with 20-years experience and would not be easily pressured, the evidence that both parties had freely entered into the deed, that Paraka had continued to occupy the building under the terms of the deed and had raised no objection to it for three years and only did so ‘when frustration started to mount between the parties because of broken promises by the defendant to pay his rent and arrears’. The same deed had also been the subject of other court proceedings between the parties, proceedings in which Paraka had not disputed its validity or raised any claim of duress.
Justice Anis refused Paraka’s application for an extension of the to file his defence and entered a default judgment in favour of Nambawan Super with damages to be assessed. Paraka was also ordered to pay the plaintiff’s legal costs.