Wuni v Namah [2018] PGNC 191; N7285 (5 March 2018)

N7285

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

WS 304 of 2014

BETWEEN:
JOHN WUNI and OTHERS
First Plaintiff

AND:
BEWANI PALM OIL DEVELOPMENT LTD
Second Plaintiff

AND:
PALMS 21 LIMITED
Third Plaintiff

AND:
HON. BELDEN NAMAH et al
(7 other defendants)
Defendants

Waigani: Hartshorn J.
2017: 13^th June
2018: 5^th March

Application for interlocutory injunctive orders

Cases Cited:
Papua New Guinea Cases

Behrouz Boochani v. State (2017) SC1566
Canopus No. 16 Ltd v. Maisi Trust Co. (2008) N3401
Employers Federation of Papua New Guinea v. Papua New Guinea Waterside
James Marape v. Peter O’Neill (2016) SC1493
Markscal Ltd v. Mineral Resource Development Co Pty Ltd (1996) N1472
Mobil Oil New Guinea Ltd v. Yakainga Business Group (Inc) (2014) N6851
Robinson v. National Airlines Commission [1983] PNGLR 478
Talisman Energy Niugini Ltd v. Bismark Maritime Ltd (2015) N6800
Workers and Seaman’s Union and Arbitration Tribunal (1982) N393
Yama Group of Companies Ltd v. PNG Power Ltd (2005) N2831

Overseas Cases

American Cyanamid Company v. Ethicon Limited [1975] UKHL 1; (1975) AC 396
Films Rover International Ltd v. Canon Films Sales Ltd [1987] 1 WLR 670

Counsel:

Mr. M. Philip, for the Plaintiffs
Mr. J. Brooks ,for Messrs Kim Tee Tee and Lip Hian Tee, Bewani Oil Palm Plantations Ltd and Bewani Forest Product Ltd

5^th March, 2018

1. HARTSHORN J. This is a decision on a contested application by the plaintiffs for amongst others, interlocutory injunctive orders that certain defendants be restrained from conducting any land clearing or logging activities on Portion 160C Bewani. The defendants against whom the orders are sought are Messrs Kim Tee Tee and Lip Hian Tee (Tee’s) as resident directors of Bewani Oil Palm Plantations Ltd (BOPP), BOPP and Bewani Forest Product Ltd (three defendants).
   

Background

2. The plaintiffs are pleaded as being landowners, directors and two landowner companies. The plaintiffs seek declaratory relief concerning the directorship, shareholding and operations of the second plaintiff Bewani Palm Oil Development Ltd (BPODL), and a Project Agreement entered into between some of the parties to this proceeding. Ancillary orders of accounting and restraint amongst others, are also sought.
   

This application

3. The plaintiffs seek to restrain the three defendants as the plaintiffs allege that:
   
   1. In May 2013 they became aware that the Project Agreement signed on 28^th October 2010 concerning amongst others, oil palm plantation development was tampered with and that the Tee’s and BOPP conspired with the first three defendants to fraudulently make changes to the Project Agreement. These changes have resulted in losses being sustained by the four landowner companies (which are shareholders of BPODL).
      
   2. The Special Agriculture Business Lease for the land for the oil palm project, Portion 160C (SABL), was recommended for cancellation by a Commission of Inquiry and the SABL has now been cancelled. Consequently, the three defendants are illegally conducting operations on the customary land covered by Portion 160C
      
   100. Damages are not an adequate remedy and the balance of convenience favours the interlocutory injunctive relief being granted because if the operations of the three defendants continue, the forest on the customary land will be replaced with oil palm, adversely affecting the customary landowners livelihood.
        
4. The three defendants resist the interlocutory injunctive relief being sought as amongst others:
   
   1. The plaintiffs have a weak substantive case as there are serious issues as to the purported nature of this proceeding brought by Mr. John Wuni on behalf of certain persons as first plaintiffs and in the name of the second and third plaintiff companies;
      
   2. Mr. Wuni is not a director or shareholder of either the second or third named plaintiff companies and the evidence is that he does not represent the landowner company that represents the 124 Incorporated Land Groups which have endorsed the Project Agreement;
      
   100. This proceeding has been referred to mediation, principally to determine internal issues relating to BPODL, the title holder to the SABL;
        
   4. The notice of motion is an abuse of process, the matter is at mediation and the pleading itself is likely to be struck out as defective on various grounds, but the defendants have not had the opportunity to make the appropriate application;
      
   5. There is no arguable case. The plaintiff’s claim is essentially that Mr. Wuni is the proper representative of the company that holds the title to the SABL, and also a claim of fraud as there is an allegation that there is an alternative version of the relevant Project Agreement. There is no evidence of this alternative Project Agreement and this proposition is not supported by the 124 Incorporated Land Groups or the landowner company which holds the title to the SABL;
      
   6. Further, there is no serious issue to be tried as Mr. Wuni does not represent the company that holds the title to the SABL, and does not represent the many persons with interests in the subject project;
      
   7. Damages would be an adequate remedy;
      
   8. The balance of convenience favours the refusal of the interlocutory injunctive relief sought as:
      
      9. The defendants have a clear right to occupy the land in question pursuant to a lease, a Forest Clearance Authority and two separate Project Agreements with the landowners and the State;
         
      2. The defendants have been developing the land in question for nearly seven years and have invested about K800 million;
         
      3. The plaintiffs have known about this development for many years, have done nothing to challenge that development and have allowed it to continue unabated;
         
      4. There is a serious issue as to whether Mr. Wuni has any authority to take proceedings on behalf of the other named first plaintiffs and on behalf of the second and third plaintiff companies;
         
      5. It is in the interests of all persons with an interest in the oil palm project that the project continues and that the 124 Incorporated Land Groups continue to receive royalties and other benefits. The project has been ongoing for many years, unchallenged;
         
      6. The defendants have developed all of the infrastructure on the land including access roads, bridges and other infrastructure;
         
      7. The defendants should be able to continue in occupation of the land until such time as the court determines the substantive claim made by the plaintiffs in this proceeding if the mediation does not resolve the issues;
         
         8. The undertaking as to damages provided by the plaintiffs is defective and Mr. Wuni is not able to compensate the defendants in damages himself.
            

Consideration

5. The principles upon which this court can grant an interim or interlocutory injunction are well settled and were recently repeated by Salika DCJ and Hartshorn J in Behrouz Boochani v. State (2017) SC1566 at [30] as follows:
   

“30. The principles upon which the court can grant an interlocutory injunction are well settled. The leading authority is a decision of the House of Lords in American Cyanamid Company v. Ethicon Limited [1975] UKHL 1; (1975) AC 396. This case has been followed on many occasions in this jurisdiction and cited with approval by the Supreme Court in Craftworks Nuigini Pty Ltd v. Allan Mott (1997) SC 525. These principles have been reaffirmed by the Supreme Court in Chief Collector of Taxes v. Bougainville Copper Ltd (2007) SC853.

31. In Chief Collector of Taxes v. Bougainville Copper Limited [2007] SC 853, the Supreme Court said at 31:

“In our jurisdiction the principles relevant to injunctive reliefs (sic) are well settled. In Golobadana No. 35 v. Bank of South Pacific, Kandakasi J. ... concluded as follows:

“A reading of these authorities shows consistency or agreement in all of the authorities that the grant of an injunctive relief is an equitable remedy and it is a discretionary matter. The authorities also agree that before there can be a grant of such a relief, the Court must be satisfied that there is a serious question to be determined on the substantive proceedings. This is to ensure that such a relief is granted only in cases where the Court is satisfied that there is a serious question of law or fact raised in the substantive claim. The authorities also agree that the balance of convenience must favour a grant or continuity of such a relief to maintain the status quo. Further, the authorities agree that, if damages could adequately compensate the applicant then an injunctive order should not be granted”.”

32. Similarly, in Ramu Nico Management (MCC) Limited and Ors v Tarsie and Ors [2010] SC 1075 at [53], in a decision in which Hartshorn J. dissented on matters not currently relevant, His Honour said:

“The law on injunctions is settled in this jurisdiction. Injunction is an equitable remedy. It is a matter for the discretion of the Court to refuse or grant the relief sought. In order for an injunction to be granted, the applicant must demonstrate to the Court that there is a serious case to be tried on the substantive proceedings. The leading authority is a decision of the House of Lords in “American Cyanamid Company v Ethicon Limited (1975) 1 All ER 594. This case has been followed on many occasions in this jurisdiction and cited with approval by the Supreme Court in Craftworks Niugini Pty Ltd v Allan Mott (1997) SC525 and Chief Collector of Taxes v Bougainville Copper Ltd (2007) SC853.”

33. If damages would be an adequate remedy then even if there is a serious question to be tried interlocutory injunctive relief should be refused: Airlines of PNG v. Air Niugini Ltd (2010) N4047 at 22 and 23 and PNG Deep Sea Fishing Ltd v. Luke Critten (2010) SC1126 at 30, PAC LNG International Ltd v. SPI (208) Ltd (2014) N5681 [24], Ramu Nico Management (MCC) Ltd v. Tarsie (2010) SC1075 [53].”

6. A “serious question to be tried”, was referred to in Robinson v. National Airlines Commission [1983] PNGLR 478 at 480 by Andrew J thus:
   

“What the plaintiff must prove is that he has a serious, not a speculative case which has a real possibility of ultimate success......”

and in Markscal Ltd v. Mineral Resource Development Co Pty Ltd (1996) N1472, it was held that an:

“Applicant must show: (1) there is a strong case, which on the evidence presented, would support a permanent injunction. ...”

7. In regard to whether the plaintiffs have demonstrated that they have a serious question to be tried, from a perusal of the evidence, there is doubt as to whether Mr. Wuni has the requisite authority to represent the other persons named as first plaintiffs. Further, the notice of motion is brought on behalf of the “plaintiffs” yet the submission in support of the application is confusing as to whether John Wuni himself or together with the other first plaintiffs, or all of the plaintiffs are seeking the relief. In any event no plaintiffs apart from Mr. Wuni have filed affidavits in support of the notice of motion. This casts doubt as to whether the other plaintiffs support the application.
   
8. Secondly, from the various company extracts in evidence, Mr. Wuni is not recorded as a director of BPODL the second plaintiff, or Palms 21 Ltd the third plaintiff. BPODL is the company that owns the SABL for Portion 160C and Palms 21 Ltd is a shareholder of BPODL. In the absence of other documentation it is not clear whether these two plaintiffs have been correctly named as such. In any event there is no evidence that Mr. Wuni represents them or acts on their behalf.
   
9. Given this, I am unable to be satisfied that this application is brought by anyone other than Mr. Wuni or that he has authority to act on behalf of or represent any other customary landowners or landowner companies that endorsed the Project Agreement, and in particular BPODL.
   
10. As to the allegations of fraud, there is no evidence provided in support. As to the submissions concerning the SABL allegedly being cancelled or revoked, there is no pleading concerning this issue and no relief sought in the amended statement of claim. I refer to the Supreme Court decision in James Marape v. Peter O’Neill (2016) SC1493 in this regard.
    
11. I am not satisfied, for the above reasons that the plaintiffs or first plaintiff Mr. Wuni have properly demonstrated that they or he have a serious question to be tried that is not speculative and is one which has a real possibility of ultimate success. Consequently the interlocutory injunctive relief should be refused.
    
12. If however, I assume for present purposes only, that a serious question to be tried has been demonstrated, the next question is whether damages are an adequate remedy.
13. The rationale for the court considering whether damages would be an adequate remedy was explained by Lord Diplock in American Cyanamid Company v. Ethicon Limited [1975] UKHL 1; (1975) AC 396 at 408:

“[t]he court should go on to consider whether, if the plaintiff were to succeed at the trial in establishing his right to a permanent injunction, he would be adequately compensated by an award of damages for the loss he would have sustained as a result of the defendant’s continuing to do what was sought to be relating to the Project Agreement would be an adequate remedy and the defendant would be in a financial position to pay them, no interim injunction should normally be granted, however strong the claimant’s claim appeared to be at that stage.”

14. The consideration is whether damages would compensate the applicant should it be found that their legal rights have been infringed by the party they are seeking to enjoin: Employers Federation of Papua New Guinea v. Papua New Guinea Waterside Workers and Seaman’s Union and Arbitration Tribunal (1982) N393, 3-4.
    
15. In this proceeding the plaintiffs do not seek any substantive relief for a permanent injunction to restrain operations on Portion 160C. An interim order is sought to restrain operations but only until the resolution of issues relating to the Project Agreement. Further, one of the main issues in this proceeding that the plaintiffs are concerned with is the loss of revenue from the operations. That the plaintiffs are concerned because the forest area is being cleared and replaced with oil palm is not pleaded in the amended statement of claim. I am satisfied that damages would be an adequate remedy and further, given the particularity of the sums and calculations in the amended statement of claim, that damages would be able to be quantified.
    
16. If however damages are not an adequate remedy, then the balance of convenience requires consideration. In this regard, I refer to the following statement by Hoffman J in Films Rover International Ltd v. Canon Films Sales Ltd [1987] 1 WLR 670 at 680:

“The principal dilemma about grant of interlocutory injunctions, whether prohibitory or mandatory, is that there is by definition a risk that the Court may make the ‘wrong’ decision, in the sense of granting an injunction to a party who fails to establish his right at the trial (or would fail if there was a trial) or alternatively, in failing to grant an injunction to a party who succeeds (or would succeed) at trial. A fundamental principle is therefore that the Court should take whichever course appears to carry the lower risk of injustice if it turns out to have been ‘wrong’ in the sense I have described.”

17. The principles contained within this passage have been affirmed in Yama Group of Companies Ltd v. PNG Power Ltd (2005) N2831; Canopus No. 16 Ltd v. Maisi Trust Co. (2008) N3401; Talisman Energy Niugini Ltd v. Bismark Maritime Ltd (2015) N6800 and Mobil Oil New Guinea Ltd v. Yakainga Business Group (Inc) (2014) N6851.
18. After considering the submissions of counsel I concur with those made on behalf of the three defendants and in particular that the defendants have been developing the land in question for almost seven years and have invested about K800 million; that the plaintiffs have known of the subject development for many years and have not challenged that development until now; that there are significant doubts concerning Mr. Wuni’s authority to bring this proceeding other than on his own behalf, and that it is in the interests of all persons with interests in the oil palm project and the 124 Incorporated Land Groups that it continue.
    
19. After taking all factors into account I am satisfied that the balance of convenience favours the relief sought not being granted and that the lower risk of injustice if my decision turns out to be wrong, supports that view.
    
20. Consequently, as I am not satisfied that the plaintiffs have established that they have a serious question to be tried, that damages would be an adequate remedy and that the balance of convenience does not favour the relief being granted, the relief sought by the plaintiff should be refused. Given this it is not necessary to consider the other submissions of counsel.
    

Orders

21. It is ordered that:

1. All of the orders sought in the notice of motion of the plaintiffs filed 4^th April 2017 are refused;
   
2. The plaintiff John Wuni shall pay the costs of and incidental to the said notice of motion of Messrs Kim Tee Tee and Lip Hian Tee as resident directors of Bewani Oil Palm Plantations Ltd, Bewani Oil Palm Plantations Ltd and Bewani Forest Product Ltd;
   

100. Time is abridged.
     

___________________________________________________________________
Korerua & Associates Lawyers : Lawyers for the Plaintiffs Lawyers for Messrs Kim Tee Tee and
Lip Hian Tee, Bewani Oil Palm Plantations Ltd and Bewani
Ashurst Lawyers: Lawyers for Forest Product Ltd