Wabia v BP Exploration Operating Co Ltd [1998] PGNC 177; [1998] PNGLR 8 (26 March 1998)

[1998] PNGLR 8

PAPUA NEW GUINEA

[NATIONAL COURT OF JUSTICE]

RONNY WABIA

V

BP EXPLORATION OPERATING CO. LTD;
DEPARTMENT OF MINING & PETROLEUM; and
THE INDEPENDENT STATE OF PAPUA NEW GUINEA

WAIGANI: SEVUA J
12 May 1997 and 26 March 1998

Facts

The first defendant has a Petroleum Development Licence (PDL) and a Pipeline Licence (PLL) issued by the third defendant to operate a petroleum project at the Hides Gas field Project in the Southern Highlands Province. These licences were properly issued under the Petroleum Act. The grant of a validity of the licence are not challenged by the plaintiff.

The plaintiff essentially seeks compensation for trespass to customary land based on customary right. He therefore seeks a declaration that he is the owner of the land in question and an injunction to restrain the first defendant from remaining or continuing in occupation of the land.

Held

1. The National Court has no jurisdiction to entertain issues relating to ownership and title to customary land. As a matter of law, that jurisdiction is vested in the Local Land Court established by the Land Dispute Settlement Act, Ch 45.
   
2. The National Court cannot arbitrate on the forms of accession or succession and hence ownership or interests in customary land because it has no jurisdiction.
   
3. The National Court has no jurisdiction to arbitrate on compensation claims relating to customary land connected with the exploration for petroleum under the Petroleum Act, as that jurisdiction is vested in the Warden’s Court, pursuant to ss 81 and 82 of that Act.
   
4. The issue of ownership of customary land in the Hides Gasfield Project has already been determined by the Land Titles Commissioner, Justice Amet (as he then was) on 25th July, 1991 in the case of The Land Titles Commission Application No. 90/101 Re Hides Gas Land Case [1993] PNGLR 310.
   
5. Pursuant to Order 12 r40 of the National Court Rules and the courts own inherent powers, the Court has a duty to protect its process by ensuring vexatious litigants do not abuse the court’s process by instituting frivolous or vexatious suits. If proceedings are considered an abuse of the courts process, the Court has a duty to protect its dignity and integrity, and can use its inherent powers to dismiss such frivolity, vexation or abuse.
   
6. "Frivolous" by its ordinary meaning means ‘not worth serious attention or manifestly futile’. Proceedings which disclose no reasonable cause of action as well as proceedings which are otherwise unsustainable are frivolous in this sense.
   
7. "Vexations" by its ordinary meaning means ‘causing vexation or harassment’. It is used to describe the harassment of a defendant being put to the trouble and expense of defending proceedings which are either a mere sham, or which cannot possibly succeed.
   
8. Proceedings which disclose no reason cause of action or which are frivolous or vexatious amount to an abuse of the process of the court. Order 12 4 40(1) of the National Court Rules confess power on the court to dismiss such proceedings. There is no reasonable cause of action in the circumstances of this case and therefore the proceedings must be dismissed for being an abuse of the court process: PNG Forest Products Ltd and Inchape Berhad v The State and Jack Genia [1992] PNGLR 85 followed.
   

Papua New Guinea cases cited

PNG Forest Products Pty Ltd & Anor v The State & Jack Genia [1992] PNGLR 85.
The Land Titles Commission Application No. 90/101 Re Hides Gas Land Case [1993] PNGLR 310.

Victor Golpak v Patrick Alongrea Kali & 5 Ors [1993] PNGLR 491.

Other cases cited

Burton v Shire of Bairnsdale [1908] HCA 57; (1908-09) 7 CLR 76.

Dey v Victorian Railways Commissioner (1948-49) 78 CLR 62.

Tampion v Anderson [1973] VicRp 32; [1973] VR 321.

Counsels

S Ketan, for plaintiff.
K Kua, for 1st defendant.
H Polume, for 2nd & 3rd defendants.

26 March 1998

SEVUA J. The first defendant, by notice of motion filed on 13th February, 1997, seeks orders inter alia, that the plaintiff’s statement of claim be struck out pursuant to Order 8 Rule 27(1) of the National Court Rules, (the Rules) or, alternatively, these proceedings be stayed and the plaintiff directed to restore his customary land ownership dispute under the Land Dispute Settlement Act, Ch 45. The first defendant’s application is supported by both the second and third defendants.

The brief facts are, the first defendant has a Petroleum Development Licence (PDL 1) and Pipeline Licence (PLL 1) issued by the third defendant to operate a petroleum project in respect of the Hides Gasfield Project in the Southern Highlands Province. The licence was issued under the Petroleum Act. All provisions in the Act relative to the issuing of licence and the operation of the petroleum project have been complied with. The grant of or validity of the licence are not challenged by the plaintiff.

The plaintiff issued proceedings in this Court for compensation for trespass to customary land based on customary right, apart from seeking a declaration that he is the owner of the land in question, and an injunction to restrain the first defendant from remaining or continuing in occupation of the land.

This application, in so far as it seeks orders under Order 8 Rule 27(1) of the Rules is supported by the affidavits of Katia Yubi, Henry Tunduma, Hewale Ogibi and Ekawi Tayanda, all sworn on 19th February, 1997. All these witnesses come from the Wita-Tondo sub-clan of the Wita Clan of Tari in the Southern Highlands. All, except Henry Tunduma, are customary leaders and spokesmen for their sub-clan. Tunduma is employed by the applicant as a community relations officer. Amongst other things, these witnesses have stated that the plaintiff is not a member of the Wita Clan or any of its sub-clan. In essence, his claim of membership of Wita Clan hence entitlement to compensation is disputed.

In respect of the order being sought under Order 8 Rule 27(1), the applicant relies on the affidavits alluded to. On the basis of the affidavit evidence, the applicant argues that, there is no trespass; the respondent plaintiff has no legal standing to bring this suit; proceedings in respect of ownership and entitlement to compensation have already been determined, thus non-jurisdictional in this court, and finally, this court has no jurisdiction to deal with the issues involved in this action because s.81 of the Petroleum Act establishes the Warden’s Court which deals with the issue of compensation.

The respondent’s argument is basically that he is a landowner whose land is situated in the first defendant’s Hides 1 Well Head and between Hides 1 Well Head and the border between Hiwa Topani Clan through which the gas pipeline runs.

From the map annexed to the writ of summons, the court notes that there is no clan called Hiwa Topani identified on the map, except Wita Topani Clan, whose land is situated between the Hides A and Hides 1 Well Heads.

The respondent complains that as the owner of the land referred to herein, and since the granting of PDL 1 and during discovery stage, his interest has not been recognised by the defendants and people dealing with compensation. He has also filed an affidavit, supported by two other landowners, who assert ownership over the same land, but have not been compensated. He says that both the first and second defendants have never listened to him and he has not received any compensation.

Mr Ketan submits that this court has jurisdiction over this matter, however if the first defendant’s application is granted, he prefers that the proceedings be stayed so that he and the first defendant can refer the matter to the Warden to determine if the plaintiff could receive any compensation for the land and improvement.

Mr Kua for the first defendant added that his client’s application is to dismiss the proceedings, if a stay is not appropriate.

At this juncture, let me say that, I take the view that this application raises the issue of jurisdiction. From this issue, two pertinent questions arise. Firstly, the question of ownership – whether the plaintiff respondent is a customary owner of land, the subject of PDL 1 and PLL 1. And secondly, if he is, whether he is entitled to compensation, and if so, the quantum of compensation. I consider this to be the paramount consideration in the plaintiff’s claim.

Counsel have referred me to the judgment of Amet, J (as he then was) who presided as Commissioner in the case of The Land Titles Commission Application 90/101 Re Hides Gas Land Case [1993] PNGLR 310. The plaintiff’s claim directly relates to land included in that decision which I wish to refer to briefly, particularly, in respect of the findings of the Commissioner.

The facts of that case were that a series of land disputes had arisen over the ownership of land within the Hides Gasfield Project in Tari, Southern Highlands Province. The disputes between different clans in the area were aggravated by the discovery of gas in the area and the payment of substantial amounts as compensation by the developer.

The Governor General, acting on the advice of the National Executive Council, referred the matter for resolution under the Land Titles Commission Act. His Honour Justice Amet, (as he then was) was appointed as Land Titles Commissioner. He determined the issue of customary ownership based on the evidence adduced before him.

The Commissioner made certain findings on ownership in relation to each portion of land in dispute before him. As far as the Wita Clan is concerned, the Commissioner found that "Hides, parts of gas and water pipeline" is owned by that clan. From the map, I note that the land area extends from Hides A to Hides 1 and all the way almost up to Girebo Water Source and halfway between Hides A and Kuru village. I further note that the land includes the gas flow line and the water pipeline. The Commissioner said that "the decision has been in favour of the clans who are in physical occupation of the land ...."

It is interesting to note that whilst the plaintiff respondent claims to be a member of the Yandira sub-clan of Wita clan, other members of the Wita Tondo sub-clan of Wita clan dispute his claim. If he is a clan member, then he should be entitled to some compensation. However if he has not been receiving compensation, it can only be concluded that he is not a landowner therefore not entitled to compensation. But, I am not determining that issue here.

I consider that the question of whether the plaintiff respondent is or is not a member of the Wita Clan is not an issue I can determine here for the simple reason that the National Court has no jurisdiction to determine membership and ownership of customary land.

In my view, this issue must be determined by the Local Land Court established by the Land Dispute Settlement Act, Ch. 45 (the Act). That Act provides for the settlement of disputes in relation to interests in customary land. "Interest" is defined in s.2 of the Act as "any interest in the land of whatsoever nature that is recognised by the customs of the people of the area in which the land is located." And "land" is defined as "customary land and includes a reef or bank, and a house or other structure built on land or over water, and things growing on land or in water over land, earths and minerals or under the land; and an interest in land."

Since the plaintiff respondent’s assertion of his membership of Wita Clan is being challenged, it is paramount, in my view, to have that issue determined by the appropriate forum. It is my view that the plaintiff’s succession or accession through clan ownership amounts to an interest in land, and since this is being disputed, the Local Land Court, which has jurisdiction over such issue, must deal with it. Section 3 of the Act states, "this Act applies to disputes as to interest in customary land ...."

Section 26(a) provides amongst other things, that the Local Land Court has jurisdiction "over and in relation to a dispute as to an interest in land".

However, whilst I am not determining the issue of customary land ownership, I consider that, the issue of ownership of customary land in the Hides Gasfield Project has already been determined by the Land Titles Commissioner, Justice Amet (as he then was) on 25th July, 1991 in the case I have already adverted to. It may have been that the Commissioner did not specifically state the sub-clans under each of those clans specified on page 319. Be that as it may, I am of the view that, if the plaintiff was a member of a sub-clan of Wita clan, he could have been included in the disputes that the Commissioner had resolved. His exclusion from receiving financial benefits can only draw one conclusion.

In the case of Victor Golpak v Patrick Alongrea Kali and Ors [1993] PNGLR 491, Doherty, J dealt with a similar issue and held that the jurisdiction to determine issues of ownership and title to customary land was vested in the Local Land Court under the Land Dispute Settlement Act Ch. 45, despite the existence of ss 155 and 166 of the Constitution. I agree with that decision and wish to reiterate that the National Court has no jurisdiction to entertain issues relating to ownership and title to customary land. As a matter of law, that jurisdiction is vested solely in the Local Land Court.

This Court therefore cannot arbitrate on the forms of accession or succession and hence ownership or control on interests in customary land because it has no jurisdiction. This Court therefore cannot deal with the plaintiff’s claim as it is.

The second question that arises under the jurisdictional issue is the question of compensation.

By law, the first defendant as the licensee, is liable to pay compensation to landowners in accordance with s 81 of the Petroleum Act Ch 198. Subsections (4), (5) and (6) suggest some degree of negotiation between the parties as to the amount of compensation. Subsection (6) provides that if the parties do not agree on the amount of compensation, either of them could apply to the Warden’s Court.

The preamble to the Petroleum Act states that, "the act is an Act to enact comprehensive legislation governing the exploration for and production of petroleum ...." The first defendant has a licence (PDL1) under this Act. The plaintiff’s claim for non-payment of compensation is in relation to the exploration for petroleum on land he asserts as his. Because the question of compensation is covered by this Act, the plaintiff must utilise the machinery and procedures under the Petroleum Act.

Section 82(1) vests the jurisdiction to hear and determine all actions arising under or out of the Petroleum Act in the Warden’s Court. The National Court therefore has no jurisdiction to determine issues relating to compensation for land, which petroleum exploration the Petroleum Act covers. To do so would be to usurp the function and jurisdiction of the Warden’s Court. Accordingly, I hold that the National Court has no jurisdiction to arbitrate on compensation claims relating to customary land connected with the exploration for petroleum under the Petroleum Act, as that jurisdiction is vested in the Warden’s Court pursuant to ss 81 and 82 of that Act.

The only issue left for me to determine now is whether the proceedings should be stayed or dismissed.

The applicant argues that the proceedings be dismissed, if not stayed.

In my view, the plaintiff should have been advised that he could not come to this court to claim the remedies he is seeking in his writ of summons, particularly the first, second and third relief. He should have been advised by his counsel or lawyer of the existence and provisions of the Land Dispute Settlement Act, Ch. 45 and the Petroleum Act, Ch. 198. I consider that the exercise undertaken by the plaintiff in mounting this suit is useless and futile, therefore his suit deserves to be dismissed.

He ought to have been advised that, as a matter of law, questions in relation to ownership or interest in customary land are not for the National Court to determine. Similarly, he ought to have been advised that in respect of claims for compensation over land connected with petroleum exploration, the National Court has no jurisdiction as a matter of law.

So what is the plaintiff’s basis for instituting this claim in this court? In my opinion, there is no proper basis and this raises the question of whether the proceedings are frivolous, vexatious or an abuse of the process of the court. Order 8 Rule 27(1) relied upon by the applicant becomes significant here, especially in relation to its application that the plaintiff’s statement of claim be struck out.

Whilst Order 8 Rule 27 deals with embarrassment, the remedy for which is, striking out, Order 12 Rule 40 deals with frivolity etc. The court’s power in Order 12 Rule 40 is discretionary.

However, the court has also inherent powers. The inherent powers are essential to the existence, dignity and functions of the court. The court’s inherent powers are its authority to do all things that are necessary for the proper administration of justice. Such inherent powers consist of all powers reasonably required to enable the court to perform efficiently its judicial functions to protect its dignity and integrity.

Essential to these inherent powers, is the court’s duty to protect its process by ensuring vexatious litigations do not abuse the court’s process by instituting frivolous or vexatious suits. If proceedings are considered an abuse of the court’s process, the court has a duty to protect its dignity and integrity, and can use its inherent powers to dismiss such frivolity, vexation or abuse. It behoves the litigants therefore to carefully choose their causes of action before they commence proceedings in this court to enforce their rights. Therefore, by the inherent jurisdiction of the court and the discretionary powers conferred by the rules, the court can dismiss proceedings it considers frivolous, vexatious or an abuse of the process.

In the present case, when one looks at the suit in its entirety, one will not miss the most conspicuous and salient feature of this case, that is, this Court lacks jurisdiction to entertain the plaintiff’s cause of action for reasons I have already alluded to. Why should the plaintiff then put the defendants to the trouble of having to defend a suit which, in my view, is useless and futile? I consider that the defendants are being put to the trouble and expenses of defending a suit which appears to be a sham and which cannot possibly succeed. It is my view therefore that the plaintiff’s claim is obviously unsustainable therefore deserving the extreme remedy of dismissal. See: Hubbuck & Sons Ltd v Wilkinson, Heywood & Clark Ltd (CA) [1899] 1QB 86 at 91 per Lindley, MR.

The descriptive words used in sub-rule (1)(a), and (c) of National Court Rules 40, Order 12, are not defined in the rules. Some assistance can be derived from Supreme Court Civil Procedure New South Wales, (2nd edition) by Young, O’Leary & Hogan, (1987, Butterworths) at pp130-133. Our Order 12 Rule 40(1) is basically the same as Rule 5 of the NSW Supreme Court Rules 1970, and the discussions under that Rule offer very helpful guidance which I adopt and make reference to in the present case.

"Frivolous", by its ordinary meaning means, "not worth serious attention or manifestly futile." Proceedings, which disclose no reasonable cause of action, as well as proceedings, which are otherwise unsustainable, are frivolous in this sense. In its ordinary meaning, "vexatious" means, "causing vexation or harassment." It is used to describe the harassment of a defendant being put to the trouble and expense of defending proceedings which are either a mere sham, or which cannot possibly succeed. As to the abuse of process argument, it is said on p131 that the use of the court process to pursue proceedings which disclose no reasonable cause of action, or which are frivolous or vexatious, is clearly an abuse of that process.

There are common law and Australian cases dealing with Rule 40(1). In respect of frivolity, the following cases describe their application.

Proceedings which the plaintiff’s claim is so obviously untenable that they cannot possibly succeed: see Burton v Shire of Bairnsdale (1908-09) [1908] HCA 57; 7 CLR 76 at 92 per O’Connor, J. Proceedings where it is clear that if they were allowed to go to trial, the plaintiff would be bound to fail, see Tampion v Anderson [1973] VicRp 32; [1973] VR 321 at 337. Proceedings which are vexatious are those that put the defendant to the trouble of having to defend proceedings which are useless and futile see Dey v Victorian Railways Commissioner (1948-49) 78 CLR 62 at 84 per Latham, CJ.

Proceedings which disclose no reasonable cause of action or which are frivolous or vexatious amount to an abuse of the process of the court. Order 12 Rule 40(1), confers power on this court to dismiss such proceedings. That power is discretionary. Furthermore, by the inherent jurisdiction of the Court, it has powers to dismiss proceedings, which are an abuse of its process. As Sheehan, J said in PNG Forest Products Pty Ltd and Inchape Berhad v The State and Jack Genia [1992] PNGLR 85, the Court has an inherent jurisdiction to protect itself from abuse of its process.

In the present case, it is my judgment that because the National Court has no jurisdiction to deal with issues relating to ownership or title to customary land, and because the National Court has no jurisdiction to deal with compensation claims relating to land connected with petroleum exploration under the Petroleum Act, the plaintiff can have no cause of action in this Court and the proceedings instituted by him are an abuse of process.

It therefore follows that staying of the procedures as preferred by the plaintiff is inappropriate. The appropriate order is that these proceedings be dismissed, and I so order.

Costs will follow the event so I order that the plaintiff pays the costs of all the defendants, to be taxed, if not agreed upon.

Lawyer for plaintiff: Peter Pena & Associates.
Lawyer for 1st defendant: Fiocco Posman & Kua.
Lawyer for 2nd & 3rd defendant: Solicitor General.