|
|
Home
| Databases
| WorldLII
| Search
| Feedback
National Court of Papua New Guinea |
PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]
WS NO. 477 OF 2001
BETWEEN:
PETER PALA
-Plaintiff-
AND:
PETER YOP
-First Defendant-
AND:
NELSON TURI
-Second Defendant-
Waigani: Injia, DCJ
2005: February 25th
LANDLORD AND TENANT – Repossession of block of land allocated by National Housing Corporation under Urban Housing Settlement Scheme – Terms of grant governed by Tenancy Agreement – Termination – Re – allocation of land to new Tenant under new Tenancy Agreement - National Housing Commission must follow proper procedures in terminating existing Tenancy Agreement before re-allocating land to a new tenant under new Tenancy Agreement – Procedure for reasonable notice of termination discussed – New Tenancy Agreement entered into with new Tenant without valid termination of existing Tenancy Agreement, and subsequent action by Department of Lands and Land Board to allocate land to new Tenant for purposes of issuing State Lease, all declared invalid.
There are no cases cited in the judgment.
Counsel:
Plaintiff in person
First Defendant in person
Second Defendant in person
25th February 2005
INJIA, DCJ: This is a matter in which all disputing parties appear in person. The dispute is over the ownership of land situated on Section 307 Lot 6, Boundary Road, Lae.
The land is owned by the National Housing Corporation (NHC) and allocated to Mr. Peter Pala under what appears to be a housing settlement scheme for urban settlers. The NHC and Mr Pala signed a Tenancy Agreement. The dispute is between the Plaintiff Mr. Peter Pala and the First Defendant Mr. Peter Yop. The Third Defendant (Mr. Turi) is a third party who has some interest in the land. He is not pursuing any claim before this Court. The arrangement was that Mr. Pala got Mr. Turi to build a house on the land for which Mr Turi would pay rent to him (Mr. Pala). After building the house, Mr. Turi got Mr. Yop to occupy the house for which Mr Yop would pay rent to Mr Turi, who in turn would share the rent with Mr. Pala. Mr. Yop converted the house into a trade store, which he operated. Mr. Pala was fully aware of this rent sharing arrangement. Later Mr. Yop arranged with the NHC to sign a new Tenancy Agreement with him. He then arranged with the Lands Department to obtain for himself a State Lease Title over the land. The Land Board recommended a Lease to him, the recommendation was gazetted and the Lands Department was preparing the issue of a State Lease to Mr. Yop. That process has now been halted by interim injunctive orders of this Court.
In these proceedings, Mr. Pala claims Mr. Yop got the land from the NHC and the Lands Department without his knowledge and permission. Mr. Pala wants the Court to declare him as the rightful owner of the land. Mr. Turi’s interest in the land is not the subject of these proceedings. He awaits the outcome of the proceedings and he will pursue his claim against whoever the Court declares is the rightful owner of the land.
The evidence before me is as follows:-
1. Affidavit evidence of Mr Pala sworn on 17 April 2001 – Exhibit "A".
2. Oral evidence of the Mr Pala.
3. Documentary evidence tendered by the Plaintiff as follows:-
(a) NHC Receipt dated 17 December 1998 – K50,00 for service block fee – Exhibit "C"(Pl).
(b) Letter for Block Settlement Committee to Lands office dated 17 January 2001 - Exhibit "D" (Pl).
(c) Letter from NHC to Block Committee dated 21 February 2001 – Exhibit "E" (Pl).
(d) Letter from Issac Pologo and Block Committee to Peter Pala dated 15 January 2001 – Exhibit "F".
(e) Tenancy Agreement between Plaintiff and NHC - Exhibit "B" (Pl).
(f) Tenancy Agreement between NHC and First Defendant - Exhibit "G" (1st Defendant).
On the undisputed evidence, I make the following findings of fact. Mr Pala is an old man from Mul-Baiyer in the WHP. On 8th October 1986, Mr. Pala entered into a standard Tenancy Agreement with the NHC, to occupy and develop the land. The land was a vacant block. The terms of the Tenancy Agreement are:
2. The tenants terms of agreement with the Department is as follows:-
(a) May occupy the land immediately after signing the Agreement and to remain there for two (2) years subject to the right of the Department to determine the tenancy as stated under clause 7.
(b) To erect or plant a fence along boundaries of the land which do not have fence or hedge along them.
(i) To start work on a permanent house within six (6) months after signing this Agreement and build it in accordance with ordinance or building Regulations currently in force and to carry out any instructions given by the Department or its Agent.
(ii) To build in places marked by pegs which will be inspected and approved by the department.
3. (a) To keep clean and stop any unhealthy conditions on the land.
(b) To place all the rubbish in garbage bins and not to throw rubbish on the road, paths, drains or any other place.
(c) To exercise proper care and stop unnecessary waste in the use of water from taps and report quickly any leaking taps to the Councils or the Department.
(d) To let the Department know if the tenant expects to be away from the land for more than three (3) months and to name the persons to act on his/her behalf in his/her absence.
4. The tenant must seek written permission from the Department before:-
(a) Using the land for any other purpose other than housing his own family.
(b) Making any business in or about his house.
(c) Keeping any inflammable liquids except house-hold fuel.
(d) Causing or wishing to cause any damage to the land.
8. It is further agreed between the Department and the tenant that:-
(a) If the tenant having fulfilled all the terms and conditions within two (2) years or with further extension of the land for the period of thirty-three (33) years worked out from the Department as stated under the Department of Housing Act.
(b) If the tenant fails in obtaining a thirty-three (33) year sub-lease, the department would consider a new application by the tenant made within the department if it wishes to repossess the land.
(c) If the tenant fails in obtaining a thirty-three (33) year sub-lease, the said land will be re-allocated.
Thereafter, Mr. Yop took possession of the Land and erected improvements. He paid yearly rentals. In 1992, Mr. Turi who is from Ialibu, SHP, entered into an oral agreement with the Plaintiff to build a house, for which he would pay Mr Pala K300/month in rent. Mr. Turi built the house. In 1998, the Mr. Turi leased the house to Mr Yop. Mr Yop converted the house into a trade store and operated it. The arrangement was that Mr Yop would pay rental to Mr. Turi, who would then share the rent money with Mr Pala. Difficulties arose over this arrangement between Mr Pala and Mr. Turi and the matter went before the District Court. In those proceedings, Mr. Yop’s interest in the land emerged. Mr. Yop claimed he had legal title to the land. The District Court would not deal with the issue of ownership. Consequently, Mr. Pala filed these proceedings. He seeks a declaration that he is the legal owner of the land.
The first question is, was Mr. Pala’s Tenancy Agreement validly terminated before the land was allocated to Mr. Yop under the new Tenancy Agreement? The second related question is, did Mr. Yop enter into a valid Tenancy Agreement with the NHC? The third related question is, did Mr. Yop lodge a valid Lease Application form with the Lands Department and consequently, the Land Board make a valid recommendation under that Application? The critical and determinative questions are the first and second questions because the grant of a State Lease is an express term of the Tenancy Agreement. A person who does not have a valid Tenancy Agreement with the NHC cannot apply for and obtain a 33-year State Lease from the Lands Department, under the NHC’s Housing Settlement Scheme.
I find on the evidence that in 1998, Mr. Pala and Mr. Yop went to see the NHC, to sort out some things in respect of the land. There is a dispute between them as to what they went to see the NHC about. I will determine this disputed point later. They went and saw Mr. Issac Pologo. As a result of the visit, Mr. Issac Pologo arranged for a new Tenancy Agreement to be signed between Mr. Yop and the NHC. Mr. Pologo signed for the NHC.
In 1999, Mr Yop and Mr Pala visited the Lands Department. They saw Mr Brian Irafa, an officer of the Department. There is no dispute that they went to see him about applying for a State Lease over the land. There is a dispute as to in whose name the State Lease was going to be applied for and issued. I will determine this disputed point later. As a result of that visit, a Land Lease Application Form was completed by Mr Yop. Subsequently, Mr. Irafa arranged for Mr. Yop’s application to come before the Morobe Land Board.
In meeting held on 18th November 1999, the Morobe Land Board considered Mr. Yop’s application. Both Mr. Pala and Mr. Yop went to this meeting with Mr. Irafa. There is a dispute as to whether Mr. Pala actually attended the Land Board hearing. Mr. Irafa says Mr. Pala was present at the meeting. Mr. Pala says he was told to sit outside the board meeting room when the board was considering the application. I will determine this disputed point later. In the meeting, a State lease was recommended to Mr Yop. This decision was gazetted in the National Gazette on 10th July 2000. There is evidence that the process under S.75 and 76 of the Land Act was commenced on 14th May 2001.
The valid allocation of vacant land by the NHC through a Valid Tenancy Agreement, and the tenant’s compliance with conditions of the Tenancy Agreement, is a condition precedent to the issue of a State lease.
The validity of Mr. Pala’s Tenancy Agreement with the NHC is not in issue in these proceedings. In fact, it never was in issue at any one time. And so, the land was not vacant land when it was allocated by NHC to Mr. Yop. Therefore, the validity of the Tenancy Agreement between NHC and Mr. Yop is dependent on the valid termination of the existing Tenancy Agreement between the NHC and Mr. Pala, in order to pave the way clear fro the land to be allocated to the new tenant, Mr. Yop. Secondly, the Tenancy Agreement between NHC and Mr. Yop must of itself be valid. In other words, the Court must be satisfied that the existing Tenancy Agreement between the NHC and Mr. Pala was validly terminated. The Court must also be satisfied that the Tenancy Agreement between the NHC and Mr. Yop must also be valid. Both issues must be decided primarily with reference to the terms and conditions of the Standard Tenancy Agreement. I consider these two issues to be determinative of the case before me.
The termination of the Tenancy Agreement must be done in accordance with the conditions and procedure stipulated in the Agreement. A breach of any of those conditions entitles the NHC to terminate the Tenancy Agreement and repossess the land. The land is then re-allocated to another tenant.
The Tenancy Agreement does not make adequate provision for the procedure for termination of the Tenancy Agreement for breach of certain conditions. There is a need to develop some procedure for termination and repossession of the land which is fair to both the NHC and the tenant. This is because Land in PNG is precious. Once the NHC has allocated a block of vacant government land to a tenant, who is in genuine need of land to build a house, the decision to allocate the land is no doubt made in good faith. It is made carefully after giving due consideration to all relevant matters including government policies on land use, the applicant’s need for accommodation, the applicant’s initial capacity to improve the land, etc.
In return, the successful applicant must fully comply with the terms of the Tenancy Agreement. Under the Tenancy Agreement, the tenant must ultimately obtain a registered State Lease. That is the ultimate purpose of this Housing Settlement Scheme. Upon the grant of a 33-year State Lease to the tenant, the NHC’s interest on the land ceases. The person is the legal registered owner of the land and provisions of the Land Registration Act applies to protect the owner’s interest.
If a tenant occupies and improves the land and does not obtain a registered State Lease, he or she nonetheless has a legal (contractual) and an equitable interest on the land, and any decision made by the NHC to terminate the Tenancy Agreement, must not be taken lightly. The starting point of course for the NHC is to conduct a proper investigation to establish if one or more of the conditions of the Tenancy Agreement have been breached by the tenant. If a breach is established, the next step is for the NHC to give notice to the tenant of the NHC’s intention to terminate the Tenancy Agreement for breaches of conditions which must be stated in the notice. The notice must be in writing and served on the tenant. In the notice, the NHC must give an opportunity to the tenant to state his or her case. After receiving the tenant’s response, if any, the NHC must then decide whether or not to terminate the Tenancy Agreement. Once the decision is made to either terminate or not to terminate the Tenancy Agreement, the NHC must inform the tenant of the decision, in writing. If the decision is made to terminate the Tenancy Agreement, then sufficient time must be allowed to the tenant to vacate the block and remove his improvements, if any, before any eviction action is taken to remove him. Once the tenant is removed through this process, the land is vacant and it is then available for re-allocation to a new tenant.
I consider this procedure that I have enunciated to be fair to the tenant and the NHC. The procedure of course is not expressly stipulated in the Tenancy Agreement but it may be implied in some of the notice provisions in the Agreement: e.g. Clause 7 and 9. The requirement to give written notice of termination and written decision on termination is implicit in the written Tenancy Agreement entered into between the parties in the first place. It is implied in the agreement that the grant and termination of Tenancy should be in writing, and through a process which is fair to both parties. The requirement for written notice of termination and decision on the termination are standard requirements in property law. They are also implied by principles of common law and equity.
The basis for this procedure is also to be found in S.53 of the Constitution which says the State or an institution of the State, such as the NHC, must not unjustly repossess, forfeit, extinguish or determine a persons right or interest in a property.
On the first issue of whether the existing Tenancy Agreement was validly terminated by the NHC, the evidence of Mr. Issac Pologo and the Plaintiff are critical. Mr. Yop did not give oral evidence. He relied on his affidavit and Mr. Pologo’s evidence. Mr. Pologo’s evidence is that Mr Pala and Mr Yop came to see him. Mr Pala told him, he wanted to return to the village as he was old and he wanted the block to be transferred to his relative Mr Yop. Mr Pologo therefore simply facilitated the transfer by getting Mr Yop to sign a new Tenancy Agreement with the NHC. There was no suggestion of payments for the land, being made or offered by Mr Yop to Mr Pala.
Mr. Pala said he went with Mr Yop to the NHC to pay his land service fee of K50.00. He produced a receipt issued to him by the NHC on the same day. He said he went to see him in order to arrange for a Land Title to be processed for himself, with Mr. Yop’s assistance. He said unknown to him, Mr. Yop tricked him and signed a new Tenancy Agreement and put his own surname "Yop" instead of "Pala", so that he could later arrange with the Lands Department for the State Lease to be issued in his own name.
On the evidence, I find it difficult to accept the evidence of Mr. Pologo and Mr Yop. I also find it difficult to accept that an old illiterate man from the village would simply give away his land which he had tried so hard to get and improve over 12 years, on a golden plate to Mr. Yop, without insisting on any payments for the land. Afterall, Mr. Yop was introduced by Mr. Turi, and Mr. Yop was only a licensee of Mr. Turi, and any suggestion of direct dealings between Mr Yop with Mr. Pala to transfer the land to Mr. Yop without Mr. Turi’s involvement must be seen with grave suspicion.
For these reasons, I reject the evidence of Mr. Pologo on the reasons advanced for the actions they took. I accept the Plaintiff’s evidence that he understood all along that Mr. Yop was to assist him to get a registered State Lease over the land. I find that Mr. Yop tricked Mr. Pala and made false representation to Mr. Pologo which resulted in the new Tenancy Agreement with him. He did this so that he could later obtain a State Lease for himself. I find that the Tenancy Agreement entered into between the NHC and Mr. Yop was based on trickery and fraud on the part of Mr. Yop. It is invalid for this reason.
There is also no evidence from Mr Pologo to show that Mr. Pala’s Tenancy Agreement was properly terminated by following the proper procedures I have set out above. The Plaintiff’s interest in the land with all the improvements he had put on it in more than 12 years of occupation, either directly or with the help of other persons like Mr. Turi, were not properly considered by Mr Pologo. The new Tenancy Agreement was signed on the same day thereby re-allocating the land to Mr. Yop. It seems to me that when the new Tenancy Agreement was signed by Mr. Yop, Mr. Pologo treated that as automatically terminating the existing Tenancy Agreement between NHC and Mr Pala, and also automatically extinguishing Mr. Pala’s interest in the land. In other words, Mr Pologo did not address his mind to any breach of the conditions of the Tenancy Agreement between NHC and Mr Pala. This is wrong in law. I find that Mr. Pala’s Tenancy Agreement with NHC was not terminated at all, in accordance with the terms and conditions of the Tenancy Agreement.
Mr Pala went on to say he went to see Lands Department official Mr. Brian Irafa to have the Lease Application Form completed in his own name with Mr. Yop’s assistance, but Mr. Yop tricked him again. Instead of putting Mr. Pala’s name down on the Lease Application Form, he put his own surname down. Mr. Irafa said they came and both men told him, the Plaintiff was old and he wanted to go back to his village and so he wanted his relative, Mr. Yop, look after the block. He simply facilitated their wishes and processed the application and made representations at the Land Board. Mr. Irafa said Mr. Pala attended the Land Board Meeting and he repeated the same statement made to him, before the Land Board.
I find that Mr. Yop once again tricked Mr Pala and made his own case before Mr Irafa. I find it difficult to accept Mr. Irafa’s evidence that he would accept Mr. Yop’s misrepresentations as if they were facts. If Mr. Pala gave the land to him at the NHC and this was facilitated by a new Tenancy Agreement with Mr. Yop, it would have been not necessary for Mr. Pala to front up at Mr. Irafa’s office with Mr. Yop. It would have been also not necessary for Mr. Irafa to interview Mr. Pala and obtain his instructions/consent because the new Tenancy Agreement, a copy of which was before Mr. Irafa spoke for itself. Mr. Pala was not a party to this new Tenancy Agreement. Mr. Pala had no reason to be there to see Mr. Irafa other than the only reason being that he was there with Mr. Yop, to see Mr. Irafa for the Land Application Form to be completed in his (Mr. Pala’s) name with Mr. Yop’s assistance him in that regard. Instead Mr. Yop tricked Mr. Pala, and misrepresented the reason why he was there, and had his own application filled in and lodged with Mr. Irafa.
At the Land Board hearing, Mr. Pala said he did not go inside. He sat outside when Mr. Irafa and Mr. Yop went inside and attended the meeting. He thought they were making the application for him. Instead of making the application for him, Mr. Yop tricked him once again and advanced his own application. Also unknown to him, Mr. Yop arranged with the Lands Department to process the Land Lease Title in his own name.
I also find that Mr. Yop tricked Mr. Pala and made him to sit outside whilst he attended the Land Board hearing, in the pretext that he was making the application on behalf of Mr. Pala.
I find that the Land Board decision was vitiated by the fraud committed by Mr Yop in submitting his own Lease Application Form based on his own Tenancy Agreement. I also find the actions taken by the Lands Department under S.75 and 76 of the Land Act to be vitiated by the false Lease Application Form and Tenancy Agreement.
I find that Mr. Yop is an educated man who is capable of misrepresenting or tricking old people like Mr. Pala and Mr. Turi as well. Even though he did not give evidence for his demeanour to be tested, I make this finding based on the way he presented his case.
On the evidence, I am unable to find if Mr. Pologo and Mr. Irara were aware of the misrepresentation of Mr. Yop. They may have been victims of Mr. Yop’s tricks as well.
For these reasons, I find that the NHC’s decision made through Mr Pologo in failing to properly terminate Mr. Pala’s existing Tenancy Agreement, the NHC’s decision to enter into new Tenancy Agreement with Mr. Yop on 17 December 1998, actions taken by Mr. Yop and the Lands Department in submitting the Land Lease Application form and the decision of the Morobe Lands Board, are all invalid. The Lands Department’s actions under S.75 and 76 of the Land Act, are also invalid decision. I declare that the Tenancy Agreement between NHC and the Plaintiff dated 8th October 1986 is still valid and the land still belongs to Mr. Peter Pala.
As for any interest Mr. Yop has in the business operated by him in the house build by Mr. Turi, he must remove his belongings and vacate the premises forthwith within fourteen (14) days from today. As for Mr. Turi’s interest in the house located on Mr. Pala’s land, he must settle that with Mr Pala. If they are not able to settle it, Mr Turi should take the matter to the District Court. If the claim for rent or other things by Mr. Pala or Mr. Turi exceeds K10,000, they may file fresh proceedings in the National Court.
Mr Yop will pay Mr. Pala and Mr. Turi’s costs of these proceedings, because he is the one who engineered this whole fraudulent scheme to get the legal title of the land to himself without Mr. Pala’s permission and put the Plaintiff and the Second Defendant to unnecessary expense.
The formal orders of the Court are:
4. Mr. Peter Yop shall pay Mr. Pala and Mr. Turi’s costs of these proceedings.
_________________
All parties appeared in persons
PacLII:
Copyright Policy
|
Disclaimers
|
Privacy Policy
|
Feedback
URL: http://www.paclii.org/pg/cases/PGNC/2005/116.html