Papua New Guinea does not imprison people for being unable to pay their debts. It does imprison people who can pay and will not, or who have arranged their affairs so that they cannot be made to. Division 5 of Part IX, headed “Imprisonment of Fraudulent Debtors”, draws the line.
The constitutional basis
No person shall be deprived of his personal liberty except by reason of his failure to comply with the order of a court made to secure the fulfilment of an obligation (other than a contractual obligation) imposed upon him by law.
The bracketed words matter. Liberty may not be taken for failing to meet a contractual obligation. A judgment for a debt is a court order, and the obligation to obey it is imposed by law, but the Magistrates’ Manual’s summary of Division 5 shows why it is confined to conduct that goes beyond mere non-payment: the debtor who has the means and refuses, the debtor who absconds, the debtor who defrauded.
The grounds
An order for the payment of a debt, of damages for assault or trespass by cattle, of damages not enforceable as a fine, of costs ordered against an informant, or for the delivery of goods, shall not be enforced by imprisonment unless it is proved to the satisfaction of the Court that the person making default (e)(i) has then, or has had since the order, sufficient means and ability to pay and has refused or neglected to pay; or (ii) is about to leave the country without paying; or (iii) is about to depart elsewhere within the country with intent to evade payment; or (iv) has refused to comply with an order for delivery of goods and has not paid their value; or (f)(i) obtained credit or contracted the liability under false pretences or by fraud or breach of trust; or (ii) wilfully contracted the liability without a reasonable expectation of being able to discharge it; or (iii) has made a gift, delivery or transfer of property, or charged, removed or concealed property, with intent to defraud his creditors.
The Manual observes that although the Act says “fraudulent”, the grounds go beyond fraud in the strict sense: refusal to pay when able is enough. It also notes that the provisions apply only after judgment; there is no imprisonment for a claim not yet ordered.
Procedure
| Step | Provision |
|---|---|
| Creditor signs an application in Form 9 stating the grounds relied on, supported by an affidavit, and lodges it with the Clerk | reg 37 |
| Summons in Form 63 personally served on the debtor, setting out the grounds | s 192(2)(a)(i) |
| Debtor examined on oath on the return of the summons; other witnesses may be summoned | s 192(2); examination taken down in writing, s 197; a judicial proceeding, s 198 |
| If a ground is proved, order in Form 64 that unless the debtor pays the sum and costs, at once or by instalments, he be committed for not more than two months | s 192(3) |
| On non-payment, the Clerk issues the warrant without further notice; all police must assist | s 194 |
| Discharge on payment, certified by the Clerk in Form 10; or at any time by order in special circumstances | s 196; reg 38 |
The standard of proof
The Act requires proof “to the satisfaction of the Court”. The Manual’s view is that because the application may deprive a person of liberty, a court will demand a high standard, beyond the ordinary civil balance of probabilities; the evidence must be real, substantial and commensurate with the seriousness of the matter. The onus is on the creditor. The debtor is entitled to natural justice: personal service, the chance to be examined and to call witnesses, and a reasoned decision. A magistrate who commits on the creditor’s bare assertion that the debtor “has money” acts outside the section.
Ex parte orders
Section 195 allows a commitment order to be made ex parte and without notice, on affidavit, where the special circumstances of the case appear to the Court to warrant it. The Manual suggests the debtor who has been served and wilfully fails to attend as an example, but insists the same standard of proof applies. The typical case is a debtor about to board a flight.
What imprisonment does and does not do
A person imprisoned who pays or satisfies the sum in the order shall be discharged on the Clerk’s certificate; and a Court may at any time, in special circumstances, order immediate discharge (s 196).
Imprisonment under this Division does not operate as a satisfaction or discharge of the amount due, and a fresh warrant against the property or other proceedings may be issued on the order (s 199).
So the debtor comes out still owing the money. The Manual describes the maximum as two months and notes that a Court may discharge earlier in special circumstances.
Who cannot be committed
Section 192(4) forbids a commitment order against a person against whom an adjudication of insolvency has been made since the order; the insolvency regime takes over. Section 193 protects a debtor leaving for Australia unless the Court is satisfied he can earn enough here to maintain his family and has means exceeding K50 beyond fares and clothing, with the onus on the debtor. The State cannot be a debtor under this Division at all. See debtors leaving the country.
Before applying
An oral examination under section 181 is the usual first step and often supplies the proof section 192 requires. A warrant of execution or garnishee recovers money; commitment only pressures. A creditor should use section 192 when the debtor plainly can pay and the other routes have failed.
The District Courts Act and Regulation are not on PacLII; both are on vLex (Act, Regulation).
Before relying on anything here, read the current text of the District Courts Act (Chapter 40) and check for later amendments. The Act is not on PacLII; the figures and time limits quoted in this series come from the consolidation to No 8 of 2000, and the District Courts (Amendment) Act 2009 changes some of them once it is brought into operation. If a decision matters to you, get advice — start with the Office of the Public Solicitor, or find a firm in the law firms directory.