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National Court of Papua New Guinea |
PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]
OS NO. 122 of 2015
BETWEEN:
SIR BROWN BAI
First Plaintiff
AND:
PATRICK REU
Second Plaintiff
AND:
HON. ASSIK TOMMY TOMSCOLL, MINISTER FOR AGRICULTURE & LIVESTOCK
First Defendant
AND:
DR. VELE PAT ILA'AVA
Second Defendant
AND:
OKA AILAN KAMALE
Third Defendant
AND:
LESLIE WUNGEN in his capacity as the GENERAL SECRETARY OF THE OIL PALM INDUSTRY CORPORATION
Fourth Defendant
AND:
THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Fifth Defendant
Waigani: Nablu, AJ
2015: 5th August, 1st October
JUDICIAL REVIEW – Oil Palm Industry Corporation Act ss 8, 9, 10 & 13 – Statutory Corporations – Calling of Board meeting in the absence of a Chairman and Deputy Chairman – Secretary for Agriculture and Livestock exceeded powers to unilaterally call the Special Board meeting – Alternate members are not counted as constituting a valid quorum pursuant to Section 13(3)(a) of the Oil Palm Industry Act, where primary members were not duly notified of the meeting – Recommendation by the Board not valid due to the lack of quorum - Appointment process of the Chairman and Deputy Chairman fundamentally flawed – Denial of natural justice where primary members were not duly notified of the Board meeting – Judicial Review granted - Writs of Certiorari and Mandamus granted.
Overseas case cited:
Associated Provincial Picture Houses Limited v. Wednesbury Corporation [1948] 1KB 23
Counsel:
G.Geroro, for the Plaintiff
L.Tangua, for the First, Second & Third Defendants
A.Ona, for the Fourth Defendant
B.Kulumbu, for the Fifth Defendant
1st October, 2015
1. NABLU, AJ: Pursuant to Order 16 Rule 1 of the National Court Rules, Sir Brown Bai and Patrick Reu, who are members of the Board of the Oil Palm Industry Corporation seek to review the decision of the Minister for Agriculture and Livestock to appoint Dr Vele Pat Ila'ava and Oka Ailan Kamale as the Chairman and Deputy Chairman of the Board on 10th February 2015. The decision was published in the National Gazette in G99 of 2015 on 12th February 2015.
2. The plaintiff seeks various declaratory orders, an order in the nature of certiorari to quash the decision and orders in the nature of mandamus to compel the members of the Board to convene a meeting to nominate members for appointment as the Chairman and Deputy Chairman.
3. The first plaintiff is the Chairman of the Palm Oil Producers Association (POPA). By virtue of his position he is an ex officio member of the Board of the Oil Palm Industry Corporation. The Corporation is a statutory body established pursuant to Section 4 of the Oil Palm Industry Corporation Act 1992 (OPIC Act). The second plaintiff is the chairman of the Hoskins Oil Palm Growers Association and was appointed a non ex officio member of the Board of the Corporation by the National Executive Council decision 182/2013 on 28th May 2013 and such decision was published in the National Gazette on 12th June 2013 in G245/2013.
4. On 12th February 2015, the Minister appointed the second and third defendant as the Chairman and deputy Chairman of the Board. The decision was published on 12th February 2015 in the National Gazette No. G99/2015.
5. The plaintiff concedes that the Minister has the power to make such decision pursuant to Section 10 of the OPIC Act. The dispute arises in relation to the decision –making process which was undertaken to nominate and recommend the members for the Minister to appoint. The plaintiff argues that the recommendation by the Board was legally flawed. Therefore, the appointment by the Minister was fundamentally flawed. It is argued that the recommendation made by the Board, was not made with lawful authority. The meeting was called for by the Secretary for Agriculture and Livestock (the second defendant). The meeting lacked a quorum. The members of the Board who were eligible to attend such a meeting and vote on the matters before the Board were not notified of the meeting nor were they present at the meeting to cast their votes.
6. The defendants argue that the second defendant, the Secretary has the power to call the Special Board Meeting. They argued that the alternate members were present at the meeting and they constituted a quorum. They also argued that the plaintiffs did not have sufficient interest to pursue this application for judicial review. The second plaintiff's appointment tenure had lapsed in May 2015 and therefore he had no interest in this matter.
7. In relation to the first plaintiff, he was and is unlawfully holding himself out as the Chairman of the Board, when he was not duly appointed by the Minister. Since 2010 the first plaintiff had on two occasions been nominated or recommended to the Minister, however on both occasions his appointment was not formalized by the Minister. The absence of an appointment notice in the National Gazette is evident of the fact that he was not the Chairman of the Board.
8. Parties have identified three (3) legal issues for determination by this Court. They are:
9. There are four grounds of review advanced by the plaintiff to challenge the first defendant's decision. I have summarised them as follows.
10. The first defendant's decision to appoint the second and third defendant was made ultra vires and exceeded his jurisdiction pursuant to Section 10(1) of the OPIC Act.
11. The first defendant committed an error of law when he made the decision contrary to Sections 10(1) and 13 (2) of the OPIC Act.
12. The first defendant's decision to appoint the Chairman and the Deputy Chairman without first notifying, the members of the Board of the special meeting, and giving them an opportunity to cast their votes in matters arising in the meeting denied the plaintiffs' the right to natural justice.
13. The first defendant's decision was unreasonable within the meaning of the Wednesbury principles of unreasonableness.
14. The Oil Palm Industry Corporation is established pursuant to Section 4 of the Oil Palm Industry Corporation Act. The Corporation is a body corporate which has perpetual succession, a seal and may acquire, hold and dispose of property and is capable of suing and being sued (Section 4(2) of the Act). The Corporation is a statutory authority whose primary function inter alia, is to promote the development of and encourage increase in productivity in the oil palm industry (Section 5 of the OPIC Act). A Board is established under Section 7 of the OPIC Act to govern the Corporations' affairs and to perform and exercise the functions and powers under the OPIC Act or any other law.
15. It is necessary for me to reproduce the relevant parts of the OPIC Act which are in contention below:
8. MEMBERSHIP
(1) The Board shall consist of
(a) the Departmental Head of the Department responsible for agriculture and livestock matters or his nominee, ex officio; and
(b) the Departmental Head of the Department responsible for financial and planning matters or his nominee, ex officio; and
(c) the Chairman of the Palm Oil Producers Association or his nominee, ex officio; and
(d) the Chairman of the Oil Palm Research Association or his nominee ex officio; and
(e) three grower representatives appointed in accordance with the Regulatory Statutory Authorities (Appointment of Certain Offices) Act 2004.
(2) The members referred to in Subsection (1)(e) shall –
(a) each be a grower representative of a Committee established under Section 19; and
(b) not be members of the same Committee; and
(c) hold office until-
(i) the expiration of their respective appointments; or
(ii) they cease to be members; or
(iii) they cease to be members of the respective Committees from which they are appointed,
whichever first occurs; and
(d) [Repealed]
(e) to be appointed for a period of two years; and
(d) eligible for re-appointment.
(3) All members referred to Subsection (1) shall hold office on such terms and conditions as are determined under the Boards (Fees and Allowances) Act 1955 (Chapter 299).
(4) A nominee referred to in Subsection (1)(a) and (b) shall be of a level not less than that of an Assistant Secretary in the Public Service or the equivalent.
16. Section 9 and 10 of the OPIC Act states that;
9. ALTERNATE MEMBERS
(1) For each of the members appointed under Section 8(1)(e), an alternate member shall be appointed in the same way and subject to the same conditions as the member for whom he is alternate.
(2) In the event of the absence or inability of the member for who he is the alternate to act in relation to a matter or to exercise and perform his powers, functions, duties and responsibilities under this Act, the alternate member has and may exercise and perform all the powers, functions, duties and responsibilities of the member, and this Act applies accordingly.
(3) Except as provided in Subsection (2), an alternate member may, unless the Board otherwise directs, attend all meetings of the Board, but shall not take part in the debate, vote on any matter or be counted towards a quorum.
(4) An alternate member is entitled to receive independently all notices, papers, minutes of meetings and other relevant information to which members are entitled.
10. CHAIRMAN AND DEPUTY CHAIRMAN
(1) The Minister shall, by a notice in the National Gazette, and on the recommendation of the members of the Board, appoint one of the members to be the Chairman of the Board and one other member to be the Deputy Chairman of the Board for a period of two years.
(2) The Chairman and Deputy Chairman shall hold office as Chairman and Deputy Chairman until the expiration of their respective appointments or until they cease to be members, whichever first occurs.
17. Section 13 of the OPIC Act states that;
13. MEETINGS OF THE BOARD
(1) The Board shall meet as often as the business of the Corporation requires, and at such times and places as the Chairman directs, but in any event not less frequently than twice in every year.
(2) Five members jointly, but not exclusively, may convene a meeting of the Board.
(3) At a meeting of the Board –
- (a) five members constitute a quorum; and
- (b) the Chairman, or in his absence the Deputy Chairman, shall preside, and if both the Chairman and the Deputy Chairman are absent, the members shall appoint, from among their own number, a chairman for that meeting; and
- (c) matters arising shall be decided by a majority of the votes of the members present and voting; and
- (d) the person presiding has a deliberative, and in the event of an equality of votes on any matter, also casting vote.
(4) The Board shall cause minutes of its meetings to be recorded and kept.
(5) Subject to this Act, the procedures of the Board are as determined by the Board and shall be determined at the first meeting of the Board and amended as required from time to time.
18. In my view, the issue for determination is whether the Secretary had powers to call the special meeting? If the answer is in the negative, then who had the authority to call the special meeting where there was a vacancy in the office of the Chairman? The next issue is whether the alternate members have the power to attend and vote, when the primary members were not notified of the special meeting? The pertinent issues also relate to the interpretation of Section 9 and Section 13 of the OPIC Act.
Ground One of Review: Ultra Vires
19. It is not contested that the first defendant has the power to appoint the Chairman and Deputy Chairman pursuant to the OPIC Act. The plaintiff however, argues that the decision was legally flawed on the basis that the recommendation by the Board was made contrary to Section 13(1) of the Act.
20. The defendants argue that the decision was made properly and in accordance with the law. The Secretary for the Department of Agriculture and Livestock was empowered to call the meeting in the absence of a Chairman and Deputy Chairman. The meeting rectified the legal vacuum and resulted in a recommendation to the Minister for appointment.
21. The law is clear, by operation of Section 10 of the OPIC Act, the Minister appoints one of the members to be the Chairman and Deputy Chairman of the Board. Members of the Board are those provided in Section 1(a) – 9(e) of the Act. For each member there is an alternate member as provided for under Section 9. Section 9(2) provides that where the members are absent or unable to exercise or perform their powers, functions, duties and responsibilities under this Act, the alternate member may exercise and perform the members' powers, functions, duties and responsibilities of the primary member for whom he or she is alternate.
22. According to Section 13(2) of the Act, five members jointly, but not exclusively, may convene a meeting of the Board. Furthermore, Section 13(3)(a) states that five members constitute a quorum.
23. Section 9(2) of the Act, provides for an alternate member to exercise and perform all the powers, functions, duties and responsibilities of the member in the absence or inability of a member to attend.
24. I am of the view, that an alternative member can only exercise the powers of the member where the member is absent or unable to. The law does not provide for the circumstances that constitute "absence or inability".
25. The evidence by the plaintiff is that they were never notified that a special meeting was called. Evidence of the minutes in the Affidavit of Leslie Wungen does not provide for an apologies section to record the absent members. According to the Affidavit of Sir Brown Bai sworn on 23rd May 2015 and filed on 24th May 2015, the first plaintiff says that he was not aware of the meeting of the 5th February 2015. He states further that he did not receive a formal notification of the meeting either from the General Secretary of the Corporation, other members of the Board or the Corporations' officials informing him that such a meeting was called.
26. In the Affidavit of Patrick Reu which was sworn and filed on 24th March 2015. He stated that he was also unaware of the meeting. He was not notified that the meeting would take place on the 5th of February 2015. He stated that his alternate member was Peter Mora who had attended the meeting. However, he did not attend the meeting because he was not notified of the meeting.
27. Harry Brock the Chairman of the Oil Palm Researchers Association is an ex officio member of the Board. In his affidavit sworn and filed on the 20th April 2015, he also stated that he did not attend the purported meeting on 5th February 2015 because he was not notified of the meeting.
28. The plaintiff also relied on the affidavit of Dickson Daima which was sworn on 13th May 2015 and filed on 19th May 2015. He stated, that he is the Chairman of the Popondetta Oil Palm Growers Association and was appointed a non-ex-officio member of the Board in June 2013. He also stated that he was not informed of the meeting. He stated that Stuart Tatauro was his alternate member who attended the meeting.
29. On the other hand, there is no evidence filed by the second defendant attesting to the events of the meeting. There is an affidavit sworn and filed by Leslie Wungen on 25th May 2015. He stated that he is the General Secretary of the Oil Palm Industry Corporation. His evidence also refers to the background of the appointments of the Chairman which were not legalized through a gazetted appointment instrument. It was for that reason, that there was a vacancy in the position of the Chairman of the Board. This prompted the Secretary to take the initiative to call for a special board meeting. On 3rd February 2015, a special board meeting was called by the Secretary for Agriculture and Livestock, in his capacity as a director of the Oil Palm Industry Corporation Board. Annexed to that affidavit, is a copy of the notice of a special meeting on official letterhead which included an agenda. There is no evidence of who was served the notice of the special meeting. He stated in paragraph 12 of his affidavit that the meeting took place on 6th February 2015 at Ela Beach Hotel. Those who attended the meeting were Dr Vele Pat Ila'ava, Oka Ailan Kamale, Kelly Kabilo, Stuart Tataturo as alternate to Dickson Daima and Peter Mora as alternate to Patrick Reu. He annexes a copy of the minutes of the special board meeting. In his affidavit he also confirms that Mr Kelly Kabilo was the confirmed nominee of the Department of National Planning and Monitoring. He stated that out of the 3 nominated members the Minister appointed the second defendant to be the Chairman.
30. In the evidence before me, I find that a number of the Board members were not notified of the meeting of the 5th of February 2015. The minutes of the meeting indicated that the following were present in the meeting; Dr Vele Pat Ila'ava, Mr Kelly Kabilo, Mr Oka Kamale, Mr Stuart Tatauro, Mr Peter Mora. Also in attendance was Mr Leslie Wungen and Mr Lawerance Yurus. Of the five members of the Board, three, namely Dr Vele Pat Ila'ava, Mr Kelly Kabilo and Mr Oka Kamale were primary members of the Board. The other members Mr Tatauro and Mr Mora were alternate members.
31. The critical issue here is, whether the alternate members can attend the meeting when the primary members whom they are alternate for are absent.
32. Despite the fact that the alternate members can attend meetings and receive notice independently, I am of the view, that they cannot exercise the powers or perform the functions and members for whom they are alternate unless the member is absent or unable to exercise the powers and perform the duties and functions. Evidence from the two primary members, namely, Patrick Reu and Dickson Daima is uncontested they were not notified of the meeting, therefore they did not attend the meeting. As alternate members they cannot exercise the rights and duties of the primary members.
33. Therefore, the meeting conducted on 5th February 2015, lacked a proper quorum and any resolutions or recommendations resulting from that meeting are unlawful and held contrary to Section 13 of the OPIC Act. Subsequently, any recommendation to the Minister for appointment is null and void and of no effect. Therefore, it follows that the decision of the Minister committed an error of law, when he made the appointments.
34. I find that the failure to notify the primary members of the meeting denied them natural justice and the right to be heard.
35. Therefore, I find that the plaintiff has proven the first and second ground of review.
Third Ground of Review: Breach of Principles of Natural Justice
36. The plaintiff argued that the decision of the first defendant to appoint the Chairman and Deputy Chairman was made contrary to Section 59 of the Constitution. In particular the purported recommendation of the Board on or about 5th February 2015 to appoint the first defendant and second defendant as Chairman and Deputy Chairman was resolved at a meeting which was convened without the other Board members. Appropriate notice of the meeting was not given to all the members of the Board, including the plaintiffs. Therefore they did not attend and cast their votes on those matters arising in the meeting.
37. Earlier, I found that the proper notice was not given to the plaintiffs and the other Board members to attend the meeting and therefore, the plaintiffs were denied natural justice. The second defendant failed to inform the members of the board that he was calling the meeting.
38. Mr Ona of counsel for the fourth defendant submitted that the first plaintiff was in fact nominated for the Chairman's post according to the minutes, therefore the meeting was done in good faith and not in breach of any law. I reject these submissions because of the fact that a person is not notified of the meeting where they should have been, is a breach of natural justice. Such arguments that he was included in the nominations, is in my view, a frivolous attempt to remedy a fundamental breach of the law.
39. I am convinced that the plaintiffs were denied natural justice. Therefore, they have made out the third ground of review.
Fourth Ground of Review: Unreasonableness
40. The meeting was unilaterally called by the Secretary. The Corporation is a Statutory body not a section of a department where the Secretary would have control and direction over. Counsel did not refer me to any legal authority which provided the Secretary with the power to assume the role of the Chairman, where the position of the Chairman or Deputy Chairman was vacant.
41. The common law principles of unreasonableness emanate from the classic case of Associated Provincial Picture Houses Limited v. Wednesbury Corporation [1948] 1 KB 233. The Wednesbury principles of unreasonableness as they are commonly referred to, has been adopted and applied in numerous cases in this jurisdiction. A succinct summary of the principles was pronounced by the Supreme Court in the case of Ombudsman Commission v. Peter Yama (2004) SC 747. They are as follows;
(1) It must be a real exercise of discretion;
(2) The body must have regard to matters which it is expressly or by implication referred by the statute conferring the discretion;
(3) It must ignore irrelevant considerations;
(4) It must not operate on the basis of bad faith or dishonesty;
(5) It must direct itself properly in law; and
(6) It must act as any reasonable person would act and must not be so absurd in its action that no reasonable person would act in that way.
42. It is the sixth principle which is often referred to as the one that succinctly summarizes the Wednesbury principles.
43. In the present case, the actions of the second defendant to unilaterally call the Special Board meeting is unreasonable. Furthermore the actions of the second, third and fourth defendant to fail to notify the plaintiffs and the other Board members of the Special Board meeting is absurd and unreasonable in the circumstances.
44. I am of the view that the breach of law and breach of a mandatory statutory process rendered the decision unreasonable. In the circumstances, I uphold the fourth ground of review.
45. Now that the plaintiffs have made out four of their grounds of review the next question to be determined is, the appropriate relief to be granted.
46. According to the plaintiffs' notice of motion the primary relief sought is an order to quash the decision, declaratory orders and orders in the nature of mandamus to compel the members of the board with voting rights to convene a meeting to resolve who to recommend to the Minister for appointment. The plaintiff also seeks an order in the nature of mandamus to compel the Minister to appoint the persons nominated by the Board as the Chairman and Deputy Chairman pursuant to Section 10 of the OPIC Act and costs.
47. It is trite law that the grant of relief is discretionary. The decision is the result of a fundamental breach of procedure and the law. Therefore, it should be removed into the Court and quashed accordingly. For avoidance of doubt, I will grant declaratory orders to that effect that the decision is null and void and of no effect.
48. I will also grant the order in the nature of mandamus to compel the members of the Board to convene a meeting within (21) days of the order pursuant to Section 13 of the Oil Palm Industry Act to resolve who will be recommended for Chairman and Deputy Chairman.
49. In regard to the order in the nature of mandamus to compel the Minister to formalize the appointment, I am of the view that, that despite the fact that it is the first defendant's prerogative to make the appointment of the Chairman and Deputy Chairman of the Board, I am of the view that there has been a long delay in effecting the appointments, given the circumstances the first defendant should be compelled to make the appointments upon receipt of the recommendations from the Board.
50. In relation to costs, the first, second and third defendant to pay 50% of the plaintiff's costs of and incidental to the proceedings to be taxed if not agreed. The fourth and fifth defendants to pay 25% each for the plaintiffs costs of and incidental to the proceedings to be taxed if not agreed.
Court Orders
Leahy Lewin Lowing Sullivan Lawyers: Lawyers for the Plaintiff
Baniyamai Lawyers: Lawyers for the First, Second and Third Defendants
Ona Lawyers: Lawyers for the Fourth Defendant
Solicitor General's Office: Lawyers for the Fifth Defendant
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URL: http://www.paclii.org/pg/cases/PGNC/2015/207.html