Kinau v Sariman (No 2) [2004] PGDC 56; DC286 (21 September 2004)

DC286

PAPUA NEW GUINEA
[IN THE DISTRICT COURT OF JUSTICE]

CASE NO 1109, 1115 OF 2003

BETWEEN

Philip Kinau
Informant

V

Angeline Theresa Sariman
Defendant

Waigani: Pinsson Pindipia
2004: 21st September

REASONS FOR THE DECISION

The Defendant is from extended bail stand charged with a total of Eight (8) counts. Four (4) of these are the charges of Conspiracy whilst the other four (4) of Misappropriation.

The Defendant Angeline Theresa Sariman is charged that she had conspired with Messers: Jimi Maladina, Herman Joseph Leahy, Henry Fabila, Iori Veraga, Mariano Lake, Janet Karl Maladina and others to defraud the National Provident Fund (NPF) of Papua New Guinea, money in the total sum of K470,000.00 contrary to Section 407 (1) (b) of the Criminal Code Act of Papua New Guinea.

The Defendant is further charged that she did dishonestly applied these monies to her own use or to the use of other persons the sum of K470,000.00, property of the National Provident Fund (NPF) of Papua New Guinea. Her actions are thus contrary to Section 3834 (1) la) of the Criminal Code Act.

ALLEGATIONS:

Are that the Defendant Angeline Theresa Sariman had conspired with other person (as named) to defraud the NPF of PNG of an amount totaling K470,000.00 and subsequently misappropriated the said monies to her own use or to the use of other persons between October 1998 and February 1999. The defendant's husband Helman Joseph Leahy was the Corporate Secretary (NPF) at the material time and she was a lawyer in the employment of Carter Newell Law Firm, in which Jimmy Maladina was a partner to the law firm.

That the Defendant's husband and Henry Fabila (M/Director NPF) at the time were alleged to have arranged, upon instructions from Jimmy Maladina, the engagement of the two independent valuers (as named) to quote their fees for full valuation of the following properties:-

(i) Waigani Land - Allotment 2 Section 429 (Hohola), and;

(ii) NPF Tower - Allotment 16 Section 5 (Granville) Port Moresby (Now Deloitte Tower).

The engagements according to Police were done as per the prior discussions and the subsequent agreement, reached between the two valuers, Jimmy Maladina and the NPF Management. As a result 50% Commission each by the two valuers were paid to Jimmy Maladina as per the prior discussions and agreement.

It was alleged, the defendant's husband, Herman Joseph Leahy and Henry Fabila were instrumental in getting NPF Management agreeing to purchase these two properties and also engaging the two valuers without the NPF Board of Trustee's approval.

The valuation fees and the subsequent payment of the fees were thus negotiated and effected through various correspondences exchanged between NPF Management (through Defendant's husband and Henry Fabila) and the two independent valuers. Accordingly each valuer were paid K60,300.00 and K60,000.00 respectively for the valuation of Waigani Land. Further K175,000.00 each were paid to the two valuers over the valuation of the NPF Tower (Now Deloitte Tower).

Further allegation is that out of the valuation fees paid, the two valuers transferred K87,500.00 each into Carter Newell Lawyer's general account The Defendant received on two occasions two separate amounts of K87,500.00 and K51,000.00 respectively from Carter Newell Lawyers General Account in February 1999. The State alleged that the monies received by the Defendant were in-fact her husband's share of the proceedings from the fraudulent deal. The Defendant cashed the cheques on 11th February 1999 and purchased a number of Cheque Books totaling K120,000.00. These were than deposited into Interest Bearing Accounts with Nambawan Finance Limited. Upon maturity the interests were credited to various bank accounts held under the defendant, her husband and her parents.

The allegation against the defendant is that she conspired with tile two valuers, Jimi Maladina, NPF Management and others to defraud NPF and misappropriate the monies to her own use or to the use of other persons.

THE STATE SUBMISSION:

There is at this stage sufficient evidence against the defendant disclosed in the Police files 011 each of the Eight (8) Counts. The State submission is the defendant be committed to the National Court to trial for all eight counts/offences. Pursuant to Section 100 (3) of the District Court Act, chapter. No.4.

DEFENCE SUBMISSION:

The Defence Submission is that, for the reasons that follow, there is 'NO SUFFICIENT EVIDENCE' against the defendant disclosed in the Police Files, upon which she could properly be committed to stand trial at the National Court for the offences. This Court is instead requested to discharged her Pursuant to Section 100 (2) of the District Court Act.

The defendant's contention is that all the State witnesses statements wholly deal with the actual purchase of the Waigani Land and provide no assistance as to the issues involving the valuation by the independent valuers, Messrs Iori Veraga and Mariano Lakae at the end of 1998. Further still witnesses do not raise any queries as to the actual engagement, valuation reports and or payments made to the valuers as their fees by the National Provident Fund (NPF).

Def- further contents that all State witnesses have provided no evidence at all linking her to the allegations in issue.

The only witness who made mention of the defendant is Oarbara Perks, who only confirms hum copies of cheques shown to her by the Police investigation officer that the defendant did sign at the back of the cash cheque upon authorization by Mr. Jim Maladina.

The defendant contends this does not in any way prove or show whose monies it is or where it came from nor where it went to after being cashed. Neither does the witnesses evidence prove any dishonesty on the defendant's part. Their evidence does not prove or show agreement of all kind between the defendant and the other co-conspirators called by Police.

The Police files instead contain documentary evidence in the form of letters exchanged between NPF and the two independent valuers with regard to the valuation of Waigani Land and NPF Tower. As to the payments by the valuers, each have confirmed in their respective "Records of Interview" with Police that they each paid 50% of their fees from NPF to Mr. Jimi Maladina as his COMMISSION for assisting them secure their valuation contracts and also as his legal fees for providing lega1 advise to them in obtaining the valuation contract

The Defense submission therefore is that Prosecution has failed to prove the fundamental elements of the Offences of Conspiracy. There is no evidence to show that the defendant Angeline Theresa Sariman agreed with Jimi Maladina, Herman Joseph Leahy (her husband) the two valuers (as named) and the other alleged conspirators to defraud the National Provident Fund of its monies totaling K470,000.00 and subsequently misappropriated these monies to her own use or to the use of other persons.

Thus Prosecution have failed in that:-

(i) There is no evidence to satisfy, the vital elements of "Conspiracy" by the defendant and the other named conspirators.

(ii) There is insufficient evidence of any dishonesty by the defendant to commit her to stand trial at the National Court

(iii) There is simply no allegation of dishonesty in the Prosecution Case what so ever.

(iv) The defendant instead submits that the monies paid to valuers by the NPF were at all material times property of the independent valuers and their respective companies and not of the NPF. That is property in money passed to the two valuers as at the time individual cheque fees were raised, and from that time towards became property of the valuers.

THE COURT:

On reading evidence contained in Police flies in light of the two submissions filed by both the Prosecution and Defence, the following have been observed:-

As it appears the Eight (8) Offences which the defendant Angeline Theresa Sariman stand charged seems to have arose out of the one incident under the same circumstances. That is it arose out of the National Provident Fund (NPF) Management proposal to purchase what the time became known as Waigani Land and the N PF Tower, properties, both in the Capital City.

In bringing about its actions against the defendant the State relied upon some twenty nine (29) witnesses statements (affidavits), Police Record of Interview, Various (Court Exhibits and other documents as disclosed in the Police flies. Prosecution in fact has relied on the same evidence 011 All eight counts defendant stand charged.

It seems to me, 8 out of the 29 witnesses four (4) are former members on the NPF Board of Trustees, and. the other four consists of current and former NPF Staff Members.

The other 21 witnesses comprises of Bank Officers, Staff Members of Carter Newell Law Firm and members of the Police Investigation team.

The letter category of witnesses in my view may provide additional supporting evidence to establishing the charges brought about against the defendant.

The relevant witnesses therefore include the eight witnesses as observed earlier.

I knee the affidavit of John Golden Jeffery sworn on 15th September 2003, makes references to his appointment on the NPF Board of Trustees on 20th April 1999. He attended his first board meeting on 29th July 1999. The alleged offences were said to have arisen in January 1999. By implication this witness came into office as NPF Board Member some six months after the periods the defendant is alleged to have committed the offences.

His evidence presumably appears to be based on the witness's observation of records held NPF and or based on other person's story.

John Gorden Jeffery's evidence unfortunately fall outside the pre-cints provided by the Evidence Law.

The State’s Relevant witnesses appear to be the four (4) members who served on the NPF Board of Trustees (as named). This Observation is based given the nature and circumstances under which the alleged offence arose.

The Board of Trustees at its meeting scheduled for 6th November and 22nd December 1998 respectively deliberated on the NPF Management proposal to purchase those two properties in question. Hence the Court Exhibits contained in the Police files show the Board's resolution, that an independent Valuation Reports" be obtained and this task was assigned to NPF Management.

Subsequently evidence in the form of Court Exhibits contained in Police files is that Messrs Henry Fabila (than M/Director NPF) and Herman Joseph Leahy (Former Corporate Secretary) exchanged correspondence with the two named valuer's to effect the Board Resolution. These correspondences amongst other things specifically requested the two valuers to quote their fees for full valuation of two properties. The two valuers have each quoted their fees and in acceptance thereof ---payments raised and paid as per invoices submitted.

Thus witness Rod Mitchel's affidavit confirms not only that letters have been exchanged but observed also that a valid contract has been entered into between NPF and the two independent valuers and payments made as per the terms of the contract.

The State contention that defendant conspired with other named conspirators to defraud NPF as the monies she received were her husband's share paid to him by Jimi Maladina arising out of the prior discussion with the two vaulers, unfortunately is not been supported by any evidence.

Apart from witness Barbara Perk's evidence which confirmed that defendant did sign at the hack of the Cash Cheque when copy shown to her by the Police Investigation Officer, the entire evidence disclosed in Police files floes not link the defendant to the allegations that she conspired with other conspirators to defraud NPF of its monies in the total sum of K470,000.00. Whilst this may be an appropriate assumptions given the circumstances surrounding the nature of these allegations, since these crimes require proof beyond any reasonable doubt, there must be sufficient evidence disclosed in the Police files.

At this Stage, unfortunately though, Police have NOT made out a prima facie case against the defendant on all four (4) counts of Conspiracy.

The Second leg of Offences relating to misappropriation .in my view may have been brought about on Police belief that monies accruing to the defendant by means of her' conspiracy with other co-conspirators, were dishonestly applied to her own use or to the use of other persons.

Police relied on the same evidence as contained in their files for these offences too. As observed earlier these allegation were said to have arisen from the NPF Management proposal to purchase what at the time became known as the Waigani Land and NPF Tower (Now Deloitte Tower) properties.

The evidence in Police files is that there were two NPF Board of Trustees meetings scheduled for 6th November and 22nd December 1998 respectively that amongst other things deliberated on the two proposals. The minutes of the Board meeting indicate a majority resolution fur NPF Management to obtain "Independent Valuation Repoprt" for the two properties.

As noted, the Court Exhibits disclosed in Police files in the form of letters (copies) that were exchanged between NPF Management and the two valuers and copies of the subsequent payments upon consensus agreement between themselves.

These letters and the agreement reached in my view constitute a valid contract entered into between NPF and the two valuers. And the subsequent payments of the valuation fees to each valuer therefore is in accordance with the Contract terms.

Hence the various cheque amounts raised to the two independent valuers, as at the dates they were issued became the respective valuers own property. That is property in money passed from NPF to the two valuer's as at the dates the cheques were raised and became property of the valuers. What becomes of the monies after that, is the valuers own business.

There is insufficient evidence in Police flies also on the four (4) offences of misappropriation.

Case dismissed against defendant on all eight (8) counts. Defendant is hereby discharged of all eight (8) counts. Bail to be refunded.