PacLII Home | Databases | WorldLII | Search | Feedback

National Court of Papua New Guinea

You are here:  PacLII >> Databases >> National Court of Papua New Guinea >> 2009 >> [2009] PGNC 249

Database Search | Name Search | Recent Decisions | Noteup | LawCite | Download | Help

Koroma v Mineral Resources Authority [2009] PGNC 249; N3926 (10 July 2009)

N3926


PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]


OS NO 280 OF 2009


JOE KOROMA
First Plaintiff


GUYEIBI NOGOI YOWA OMOWO
LAND GROUP INC ILG NO 12155
Second Plaintiff


PETER KOWANE
Third Plaintiff


TIGINA KWIAVE
LAND GROUP INC ILG NO 10244
Fourth Plaintiff


V


MINERAL RESOURCES AUTHORITY
First Defendant


RAMU NICKEL LIMITED
Second Defendant


RAMU NICO MANAGEMENT (MCC) LIMITED
Third Defendant


THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Fourth Defendant


Madang: Cannings J
2009: 7, 10 July


PRACTICE AND PROCEDURE – motion to dismiss proceedings for failure to disclose reasonable cause of action, being frivolous and vexations, being an abuse of process – National Court Rules, Order 12, Rule 40.


INJUNCTIONS – interim orders sought re provision of information and documents to parties claiming interest in customary land over which special mining lease has been granted – interim orders sought to prevent


holder of mining tenement entering tenement pending determination of proceedings.


Individuals and clans who claimed to have an interest in customary land over which a special mining lease has been granted commenced proceedings by originating summons seeking declarations that, amongst other things, various documents and agreements, including a compensation agreement, are void. Prior to the trial of the originating summons, two motions were filed. One by the third defendant (the tenement holder) supported by the first defendant (the Mineral Resources Authority), seeking orders that the entire proceedings be dismissed as no reasonable cause of action is disclosed, the proceedings are frivolous and vexatious and an abuse of process, and the proceedings relate to title to customary land and fall outside the jurisdiction of the National Court. The other motion is by the plaintiffs and seeks orders that various information and documents be provided to them and orders in the nature of interim injunctions that no meetings regarding landowner issues be held without their involvement and that the holder of the special mining lease be restrained from entering certain parts of the land covered by the lease pending determination of the substantive proceedings.


Held:


(1) It is sufficiently apparent that the relief sought in the originating process is based on alleged breaches of Part VII (compensation to landholders) of the Mining Act. Accordingly a reasonable cause of action has been disclosed, the proceedings are neither frivolous nor vexatious and no abuse of process has been proven. Further, the cause of action is not beyond the jurisdiction of the National Court. The motion for dismissal was consequently refused.

(2) As to the plaintiffs' motion for interim orders, an arguable case in support of the substantive proceedings was made out but the balance of convenience and the interests of justice do not warrant the granting of most of the interim relief sought by the plaintiffs.

(3) Orders made to require the Mineral Resources Authority to furnish certain information and documents to the plaintiffs.

Cases cited


The following cases are cited in the judgment:


Chief Collector of Taxes v Bougainville Copper Ltd (2007) SC853
Ewasse Landowners Association Inc v Hargy Oil Palms Ltd (2005) N2878
Kiee Toap v The State (2004) N2731
Ok Tedi Mining Ltd v Niugini Insurance Corporation (No 2) [1988-89] PNGLR 425
Ronny Wabia v BP Exploration Co Ltd [1998] PNGLR 8
Tigam Malewo v Keith Faulkner and Ok Tedi Mining Ltd (2009) SC960


Counsel


T Nonggorr, for the plaintiffs
D Aikung-Hombhanje, for the first defendant
G Gileng, for the third defendant


10 July, 2009


1. CANNINGS J: This is a case about the Ramu Nickel Project in Madang Province. The plaintiffs represent two of the 25 clans who claim to be customary owners of the land covered by the special mining lease for this project. The plaintiffs are aggrieved by the way in which various agreements about compensation and spin-off projects have been negotiated and entered into over the last ten years or so. They say that the State and its agents, including the Mineral Resources Authority, and the developer of the mine and holder of the special mining lease (the third defendant) have shut them out of the process. They say that negotiations and agreements have been entered into with an association called the Kurumbukari Landowners Association which is not truly representative of all clans claiming to be customary landowners. They say that that Association represents only four clans.


2. The plaintiffs on 29 May 2009 filed an originating summons, seeking declarations that, amongst other things, various documents and agreements purporting to be signed on behalf of the customary landowners of the part of the special mining lease called Kurumbukari Block 1, including a compensation agreement, are void.


3. The trial of the originating summons has not yet been conducted. While the trial is pending, two motions have been filed.


4. The first motion, filed on 24 June 2009, is by the third defendant (the tenement holder), and is supported by the first defendant (the Mineral Resources Authority). They seek orders that the entire proceedings be dismissed for two reasons. First, no reasonable cause of action is disclosed, and the proceedings are frivolous and vexatious and an abuse of process. Secondly, the proceedings relate to title to customary land and fall outside the jurisdiction of the National Court.


5. The other motion, filed under an amended notice of motion on 2 July 2009, is by the plaintiffs. They seek orders that various information and documents be provided to them and orders in the nature of interim injunctions that no meetings regarding landowner issues be held without their involvement and that the holder of the special mining lease be restrained from entering certain parts of the land covered by the lease pending determination of the substantive proceedings.


This is a ruling on those two motions.


THE FIRST MOTION: SHOULD THE PROCEEDINGS BE DISMISSED?


No reasonable cause of action etc


6. The first and third defendants argue that the proceedings disclose no reasonable cause of action and are frivolous and vexatious and an abuse of process as the plaintiffs' claims are merely speculative. A Special Land Titles Commission has been established to inquire into and determine the question of customary ownership of the land covered by the SML. Until that Commission completes its inquiry and makes its determinations the plaintiffs have no interest in the land capable of enforcement through the processes of the National Court. It is plain and obvious that the plaintiffs will not succeed. Mr Gileng, for the third defendant, relied on the decision of Kapi DCJ in Ok Tedi Mining Ltd v Niugini Insurance Corporation (No 2) [1988-89] PNGLR 425 and other cases regarding summary dismissal of proceedings including Kiee Toap v The State (2004) N2731 in support of those propositions.


7. Having heard the explanation by Mrs Nonggorr, for the plaintiffs, as to the nature of the plaintiffs' case and considered the affidavits filed on behalf of the plaintiffs, I cannot agree with Mr Gileng's arguments. The plaintiffs are pinning their claims for relief on Part VII (compensation to landholders) of the Mining Act, which contains provisions aimed at settling the issue of compensation to landholders before mining activities commence. Section 155 (no entry until compensation agreed or determined) is a key provision. It states:


The holder of a tenement shall not enter onto or occupy any land, the subject of the tenement, for the purpose of mining, until—


(a) he has made an agreement with the landholders as to the amount, times and mode of compensation and the agreement has been registered in accordance with Section 156(6); or


(b) compensation has been determined in accordance with this Part and the holder of the tenement has paid or tendered such compensation as is then due.


8. The plaintiffs claim that the compensation agreement that has been registered and any determination of compensation are void as all agreements concerning the Ramu Nickel Project have been entered into with the Kurumbukari Landowners Association, which is not a "landholder" – it is just a group representing four clans who, like the plaintiffs and a number of other clans, are disputing claimants to the land. Furthermore, there has been no proper Warden's hearing as to compensation as required by Section 157 of the Act.


9. The plaintiffs are asserting through the originating summons that all documents and agreements regarding the Ramu Nickel Project purporting to be signed on behalf of the customary landholders are void, on the ground that the provisions of Part VII of the Mining Act have not been complied with. This is not a speculative claim. The plaintiffs are asserting that the breaches of the Act have already been committed. They are claiming, like a number of other clans including the members of the Kurumbukari Landowners Association, to have an interest in the land. They are disputing claimants. They say that they had a right to be heard and consulted on all the things included in the compensation agreement and other agreements and documents that have been signed on behalf of the Kurumbukari Landowners Association.


10. In the recent case of Tigam Malewo v Keith Faulkner and Ok Tedi Mining Ltd (2009) SC960 the Supreme Court ruled that an originating summons that sought relief in favour of customary landowners affected by the Ok Tedi copper mine in Western Province failed to disclose a reasonable cause of action. The originating summons was poorly drafted, convoluted, did not demonstrate that it had a clear legal basis and had no identifiable structure. The originating summons in the present case stands in stark contrast to the originating summons in Malewo. I do not think it is a perfect document. It would have presented the plaintiffs' cause of action more clearly if the provisions of the Mining Act that the plaintiffs are saying were breached had been expressly stated in the originating summons. However, having heard the explanation from the plaintiffs' counsel and considered the affidavits filed on behalf of the plaintiffs, I consider that there is a readily identifiable cause of action.


11. I am not satisfied that the plaintiffs' prospects of success are so bleak as to regard the proceedings as frivolous or vexatious and I cannot detect any abuse of process on the part of the plaintiffs. I therefore reject the argument that the proceedings should be dismissed under Order 12, Rule 40 of the National Court Rules.


Jurisdiction of National Court


12. The other reason provided by the defendants for dismissing the proceedings is that the National Court has no jurisdiction to deal with the plaintiffs' claims. The defendants rely on the well-settled principle that the National Court has by virtue of the Land Titles Commission Act and Land Disputes Settlement Act no original jurisdiction to determine issues relating to ownership of customary land (Ronny Wabia v BP Exploration Co Ltd [1998] PNGLR 8).


13. However, this is not a case in which the plaintiffs are asking the Court to determine that they own customary land. They are not asking the Court to determine which clans own which parts of the SML. Those are issues that are before the Special Land Titles Commission. I agree with Mrs Nonggorr's submission that the plaintiffs are simply bringing their grievances to the National Court to prosecute their claims, as disputing claimants, that the provisions of Part VII of the Mining Act have not been complied with and that their right to be heard on the compensation agreement and related matters has been denied them. I reject the argument that the cause of action asserted through the originating summons is beyond the jurisdiction of the National Court.


14. All the relief sought in the third defendants' motion filed on 24 June 2009 will therefore be refused.


THE SECOND MOTION: SHOULD INTERIM ORDERS BE GRANTED IN FAVOUR OF THE PLAINTIFFS?


What orders are sought?


15. The plaintiffs are seeking three types of orders:


➢ First, they want the court to order the Mineral Resources Authority to provide various information and documents to them.

➢ Secondly, they seek orders in the nature of interim injunctions that no meetings regarding landowner issues be held without their involvement.

➢ Thirdly, they want the third defendant, the holder of the special mining lease, restrained from entering certain parts of the land covered by the lease pending determination of the substantive proceedings.

16. The first type of order is sought under paragraphs 1 and 2 of the notice of motion, the second type under paragraphs 3 and 3A and the third type under paragraph 4. These paragraphs state:


1 That pursuant to Section 155(4) of the Constitution the Mineral Resources Authority shall provide all information and documents to the Plaintiff that a customary landholder at Kurumbukari Blocks 1, 3 and 4 should have been entitled to receive to date concerning the Ramu Nickel Project and Kurumbukari Blocks 1, 3 and 4 within 7 days.


2 That pursuant to Section 155(4) of the Constitution the Mineral Resources Authority shall provide all information and documents to the Plaintiffs that a customary landholder at Kurumbukari Blocks 1, 3 and 4 is entitled to receive concerning the Ramu Nickel Project and Kurumbukari Blocks 1, 3 and 4 until the customary land ownership is determined and the identity of the landholders are determined.


3 That pursuant to Section 155(4) of the Constitution until the customary land ownership of Kurumbukari Block 1 is determined, no meeting, discussion, agreement whatsoever involving any or all of the parties to these proceedings concerning the Ramu Nickel Project and Kurumbukari landowners and Kurumbukari Block 1 shall occur without the involvement of the Guyeibi Nogoi Yowa Omowo Clan Land Group Inc.


3A That pursuant to Section 155(4) of the Constitution until the customary land ownership of Kurumbukari Blocks 3 and 4 is determined, no meeting, discussion, agreement whatsoever involving any or all of the parties to these proceedings concerning the Ramu Nickel Project and Kurumbukari landowners and Kurumbukari Blocks 3 and 4 shall occur without the involvement of the Tigina Kwiave Land Group ILG No 10244.


4 That pursuant to Section 155(4) of the Constitution and Order 14, Rule 10 of the National Court Rules that the mining company Ramu Nico (MCC) Limited and any of its or related companies' employees, representatives, contractors or associates be restrained from entering onto and remaining on the land known as Kurumbukari Block 1, 3 and 4 in the Special Mining Lease area pending:


(a) the provision by the Mineral Resources Authority to the Plaintiffs of all relevant documentation to the development of the mine and the landowner involvement, including but not limited to:

(b) the determination of these proceedings.


Principles to apply when seeking interim orders


17. The relevant principles were recently confirmed by the Supreme Court in Chief Collector of Taxes v Bougainville Copper Ltd (2007) SC853. It is incumbent on a plaintiff seeking interim orders to show that:


(a) there are serious questions to be tried and that an arguable case exists;

(b) an undertaking as to damages has been given;

(c) damages would not be an adequate remedy if the interim order is not granted;

(d) the balance of convenience favours the granting of the interim order; and

(e) the interests of justice require that the interim order be made.

18. The principles can conveniently be applied by posing five questions. They are drafted so that a 'yes' answer will be a factor weighing in favour of granting an interim order and a 'no' answer will work against making such an order.


19. Because the plaintiff is seeking three distinct types of orders, I will pose each question in relation to each type of order.


(a) Are there serious questions to be tried and do the plaintiffs have an arguable case?

20. This requires the Court to make an assessment of the prospects of success of the plaintiffs' substantive action by looking at the originating process (in this case, the originating summons) and the evidence that has been adduced to date.


21. I have already rejected the motion that the originating summons fails to disclose a reasonable cause of action. I have considered the nature of the cause of action being prosecuted by the plaintiffs. I am satisfied that there is an arguable case arising from the material so far filed, and that there are serious questions to be tried concerning the validity of the compensation agreements and other agreements and documents that have been signed by the Kurumbukari Landowners Association regarding the Ramu Nickel Project.


22. Question (a) is answered yes in relation to each of the three types of orders.


(a) Has an undertaking as to damages been given?

23. Undertakings have been signed by all plaintiffs.


24. Question (b) is answered yes in relation to each of the three types of orders.


(c) If an interim order is not granted, would damages be an inadequate remedy?


25. What will happen if the interim orders are not made, but it turns out the plaintiffs succeed at the trial and agreements and documents that have been signed by the Kurumbukari Landowners Association regarding the Ramu Nickel Project are declared void? Would the plaintiffs be able to be compensated with damages? Would that be an inadequate remedy?


26. Mrs Nonggorr submits that yes, damages would not be a sufficient remedy. as the plaintiffs need to be able to participate in negotiations prior to development. That is their right, she submits. This cannot be compensated later by money. They wish to insist on proper informed consent being obtained from them as indigenous peoples and this cannot be quantified by money. The protection of their culture and heritage and their interest in environmental issues cannot be adequately compensated by money.


27. I am not persuaded by this argument, at this stage. The impression I have gained from the explanation of the plaintiffs' cause of action provided by Mrs Nonggorr and the affidavits filed on behalf of the plaintiffs is that their principal concern is that they have been unfairly and unlawfully shut out of negotiations over compensation and spin-off projects.


28. Question (c) is answered no in relation to each of the three types of orders.


(d) Does the balance of convenience favour the granting of interim orders?


29. As I said in Ewasse Landowners Association Inc v Hargy Oil Palms Ltd (2005) N2878 this requires the court to ask: what is the best thing to do on an interim basis taking into account the conflicting interests? What will happen if an interim order is not granted? What will happen if an interim order is granted? Who will suffer the greatest inconvenience or prejudice?


30. This is where it is very important to distinguish between the three different types of orders that are being sought.


31. If the first type of order (the Mineral Resources Authority to provide various information and documents to the plaintiffs) was not made, this would cause considerable harm to the plaintiffs' case and would see them continue to be kept in the dark as to what agreements have been entered into and would prevent them knowing the terms of future agreements. If it was made, I cannot see much harm or prejudice to anybody. I am not impressed by the argument that such agreements should be treated as 'commercial in confidence'. Where the question of whether the parties who signed those agreements purporting to act on behalf of customary landowners remains a burning issue, such agreements, especially those that have the imprimatur of the Mineral Resources Authority, should be regarded as tantamount to "official documents", in which case the plaintiffs, being citizens, would have a right of access to them under Section 51 (right to freedom of information) of the Constitution. The balance of convenience lies in favour of making the first type of order.


32. As to the second type of order – the plaintiffs seek interim injunctions that no meetings regarding landowner issues be held without their involvement – different considerations arise. If this type of order were made, the pattern of negotiation that has developed over the last few years may be seriously disrupted. This may disrupt the orderly progress of the project. And that would cause considerable inconvenience to not only the developer of the project, but many businesses and individuals who are relying on it for their sustenance or survival. If this type of order were not made the plaintiffs would be left in much the same position that they are in at the moment: they would continue to feel aggrieved and frustrated at being shut out of negotiations. I think that inconvenience is outweighed by the far greater prejudice that would be generated against a greater number of people if the order were made.


33. The balance of convenience lies against making the second type of order.


34. As to the third type of order – the plaintiffs want the third defendant, the holder of the special mining lease, restrained from entering certain parts of the land covered by the lease pending determination of the substantive proceedings – this is a very significant order. Mrs Nonggorr conceded that the effect of such an order would be to immediately shut down the Ramu Nickel Project. Mr Gileng and Ms Aikung, for the defendants, submitted that this was an alarming prospect and that the balance of convenience weighs heavily against making such an order.


35. Mrs Nonggorr submitted that the defendants had not adduced clear evidence of the impact of such an order on the developer and the businesses reliant on it or on the economy of the province and PNG as a whole. I consider that such detailed evidence is not necessary. The court is entitled to take judicial notice of the fact that the Ramu Nickel Project is a significant project for the provincial and national economy. Shutting down the project – which is still in the developmental stage as mining has not commenced yet – would have an enormous impact on the developer and the businesses and individuals depending on it. As I indicated in Ewasse v Hargy the court must be conscious of the economic and social impacts of its orders and the messages that its orders send to the community, including the investment community.


36. The balance of convenience clearly lies against making the third type of order.


(e) Do the interests of justice require that interim orders be made?


37. This criterion gives the court the opportunity to consider discretionary matters not previously considered.


38. As for the first type of order, the interests of justice require that it be made.


39. As for the second and third types of orders, for the reasons I have expressed under the balance of convenience criterion, I do not consider that it is in the interests of justice that these orders be made.


Conclusion


(a) Yes, the plaintiff has an arguable case, which favours the making of each type of order.


(b) Yes, undertakings as to damages have been given, which favour the making of each type of order.


(c) No, if the interim orders were not made, damages would not be an inadequate remedy. This is a factor working against the making of each type of order.


(d) Yes, the balance of convenience favours making the first type of order, but not the second and third types of order.


(e) Yes, the interests of justice favour making the first type of order, but not the second and third types of order.


40. Thus, as to the first type of order: four of the five considerations favour the granting of the orders. I will exercise my discretion by making these orders.


41. As to the second and third types of order, only two of the five considerations favour the making of these orders. I exercise my discretion by refusing to make the orders sought.


ORDERS


42. The formal determinations of the two motions I have ruled on are:


(1) The relief sought in the notice of motion filed by the third defendant on 24 June 2009 is refused.

(2) The relief sought in paragraphs 3, 3A and 4 of the plaintiffs' amended notice of motion filed on 2 July 2009 is refused.

(3) The relief sought in paragraphs 1 and 2 of the plaintiffs' amended notice of motion filed on 2 July 2009 is substantially granted, with some modification, and accordingly, for the avoidance of doubt, it is ordered that:

(4) The parties shall bear their own legal costs.

(5) Time for entry of this order is abridged to the date of settlement by the Registrar which shall take place forthwith.

Rulings accordingly.
____________________________


Tiffany Nonggorr Lawyers: Lawyers for the Plaintiffs
Dianne Aikung –Hombhanje: Lawyer for the First Defendant
Posman Kua Aisi Lawyers: Lawyers for the Third Defendant


PacLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback
URL: http://www.paclii.org/pg/cases/PGNC/2009/249.html