Yogae v Bonou [2020] PGNC 131; N8331 (29 May 2020)

N8331

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

HR(OS). 10 OF 2020

BETWEEN:
ISAAC YOGAE
Plaintiff

AND:
RUAIZE BONOU
First Defendant

AND:
RAMU NICO MANAGEMENT (MCC) LIMITED
Second Defendant

Madang: Narokobi J
2020 : 27^th & 29^th May

INJUNCTIONS – interim injunction – application for injunction to stop payment of royalties – relevant considerations to exercise of court’s discretion – equitable principles – Constitution, Section 155(4).

The plaintiff, a landowner and beneficiary of royalties of the nickel and cobalt mining operation, commenced proceedings to compel payment of royalties directly to him as he was not receiving his allotted amount from the defendants. The plaintiff sought an interim injunction, pending the hearing and determination of the substantive proceedings.

Held:

(1) When dealing with applications for interim injunctions the court should consider four main issues. First, are there serious questions to be tried or does the plaintiff have an arguable case? Secondly, does the balance of convenience favour granting the injunction? Thirdly, is an injunction necessary to do justice in the circumstances of the case? Fourthly, whether an undertaking as to damages has been given.

(2) In the circumstances, all of the considerations favoured the granting of the injunction sought.

(3) The application for an interim injunction was accordingly granted.

(4) The court has discretion pursuant to s 155(4) of the Constitution to determine the precise terms of the injunctions in the interests of justice.

Cases Cited:
The following cases are cited in the judgment:

Aihi v The State (No 1) [1981] PNGLR 81
AGK Pacific (NG) Ltd v William Brad Anderson, Karson Construction (PNG) Ltd and Downer Construction (PNG) Ltd (2000) N2062
Employers Federation of Papua New Guinea v Papua New Guinea Waterside Workers and Seaman's Union and Others (1982) N393
Ewasse Landowners Association Incorporated v Hargy Oil Palms Ltd (N2878)
GobeHongu Ltd v National Executive Council (1999) N1920
Robinson v National Airlines Commission [1983] PNGLR 276

Counsel:
Ms. E. Valakvi, for the Second Defendant
Mr. S. Asivo, with leave of the court for the Plaintiff
No appearance for the First Defendant

RULING

29^th May, 2020

1. NAROKOBI J: The Plaintiff has filed an Originating Summons on 27 April 2020 seeking orders for royalty money to be paid into his account and an application for interim relief pending the resolution of the substantive matter.
   

A BACKGROUND

2. The Plaintiff has filed a Notice of Motion on 27 April 2020 seeks interim orders to restrain the Second Defendant from paying any of the royalty monies into the personal bank account of the First Defendant held at the Bank South Pacific Madang Branch until further orders of the National Court.
   
3. Initially the motion was to be heard on 20 May 2020, but then adjourned to Monday 25 May 2020 to give an opportunity to the Second Defendant to respond. Due to mix up with dates it was not heard on 25 May 2020 and adjourned to Wednesday 26 May 2020, when the matter was heard and decision reserved.
   
4. The First Defendant could not be located to serve the court documents, and due to the urgency of the matter, the court proceeded to hear the application.
   
5. In support of the application, the plaintiff relies on his own affidavit filed on 27 April 2020.
   
6. Since there was no Undertaking as to Damages filed, I directed the Plaintiff to file one by Thursday 28 May 2020.
   
7. The Second Defendant contests the application and relies on the affidavit of Luke Lange filed on 25 May 2020.
   

B PARTIES CONTENTION – PLAINTIFF

8. The Plaintiff has filed the case on his own, and does not have a lawyer representing him, but Mr Asivo with leave of the court, is speaking on his behalf.
   
9. The Plaintiff is a landowner of the Ramu Nico Management (MCC) Limited operated Nickel and Cobalt mine at Kurumbukari in the UsinoBundi District of the Madang Province.
   
10. He is also an identified beneficiary of the royalties paid by the Ramu Nico Management (MCC) Limited.
    
11. In his Notice of Motion, the Plaintiff seeks the following orders:
    

“1) Pursuant to Order 1 Rule 7 of the National Court Rules, requirements for service of this application is dispensed with

2) Pursuant to Order 12 Rule 1 of the National Court Rules and Section 155(4) of the Constitution, the Second Defendant is restrained from paying any further royalty monies into the personal bank account of the First Defendant held at the Bank of South Pacific Madang Branch until further orders of the National Court.

3) Any other orders this Honourable Court deems appropriate under the prevailing circumstances.

4) Costs of the motion are in the cause.

5) Time and entry of these orders is abridged.”

12. In the Plaintiff’s affidavit referred to above, he deposes to the following matters.
    
13. At paragraph 3 he refers to a Wewei Maure Clan meeting on 1 October 2018 which outlines the distribution percentage he is entitled to. He is entitled to 16.66% and the First Defendant is also entitled to 16.66%.
    
14. The Minute of the Meeting is enclosed as Annexure A of his affidavit. Following the meeting of 1 October 2018, the Plaintiff says the 50% which was supposed to be paid to the Bonou family was paid by the staff of the Second Defendant directly into the account of the First Defendant held at the Bank South Pacific’s Madang Branch.
    
15. When the first lot of payment of K166, 400.46 was paid into the First Defendants account she only paid him K12,000 which is only 3.61% of his entitlement of K55,466.82 which is 16.66%. There was a short payment of K43,666.82.
    
16. When the second lot of payment was made of K32,000, the Plaintiff was only paid K6,000.00. He was entitled to K10,665.60. He was short paid by K4,655.60.
    
17. He was not paid any money at all in the third payment.
    
18. A complaint was made to the police and there is evidence to that effect in a letter dated 28 August 2019.
    
19. When the first defendant was apprehended by the police, the Plaintiff deposes at paragraph 11, the First Defendant admits to short paying the Plaintiff. She says she would make good her error. She has not done so.
    
20. The Plaintiff is therefore seeking an interim stay and substantive orders for his portion of the money to be paid directly to him.
    

C PARTIES CONTENTION – FIRST DEFENDANT

21. There is no appearance by the First Defendant, and in any case the Plaintiff has properly sought leave to dispense with the requirements for service.
    

D PARTIES CONTENTION – SECOND DEFENDANT

22. The Second Defendant relies on the affidavit of Luke Lange, filed on 25 May 2020. Mr Lange is the Senior Lands Officer with the Community Affairs Department, I presume of the Second Defendant.
    
23. Mr Lange says at paragraph 3 of his affidavit, both the Plaintiff and the First Defendant are from the Wewei Maure Clan.
    
24. He deposes further at paragraph 4, that on or about 12 August 2013, the Ramu Nickel Cobalt Special Land Titles Commission (SLTC) declared and ordered that the Maure Clan has exclusive land ownership rights over Maure land and others have only land use rights.
    
25. The decision of the SLTC was successfully appealed . On 21 March 2018 the National Court quashed the SLTC decision and declared and ordered that the Maure, Wewei Maure and Maure Duakai Narawa clans are joint traditional landowners of Maure land. This is deposed to in paragraph 6 of Mr Lange’s affidavit. A copy of the court order dated 24 March 2018 is enclosed in Annexure B.
    
26. In paragraph 7, Mr Lange says that the benefit sharing as ordered by the National Court is as follows:-
    
    1. Maure Clan – 50%;
    2. Wewei Maure Clan – 25%;
    3. Maure Duakai Narowo Clan – 25%
       
27. The Second Defendant made payment following this distribution, as ordered by the National Court (paragraph 8 of Mr Lange’s affidavit).
    
28. The royalty payment for the Weiwei Maure Clan is paid to Maure Clan Ruaize Bonou and Waskop Unua(account name), account number #: 7011901464, Bank South Pacific).
    
29. There have been three payments totaling K654,253.86, composed of the following amounts:
    
    1. K332,800.92;
    2. K108,602.32; and
    3. K212,850.62.
       
30. Essentially what the Second Defendant is saying is that its hands are tied in terms of distribution consistent with the court order of 21 March 2018.
    

E ISSUES

31. Having heard the submission of the parties and reading the relevant affidavits, I consider the issues to be as follows:
    
    • Should the court issue an injunction given the factual circumstances of the case?; and
    • If the circumstances of the case warrant the issuance of an injunction, what terms should the injunction take in the interest of justice?
      

F THE LAW

32. The law on the grant of injunction is settled in this jurisdiction.
    
33. The first point of law to observe is that an injunction is founded in equity and as such it is applied at the discretion of the courts (see AGK Pacific (NG) Ltd -v- William Brad Anderson, Karson Construction (PNG) Ltd and Downer Construction (PNG) Ltd (2000) N2062, Injia J, (as he then was)).
    
34. There are many cases which outline the following four principles which the court ought to addressits mind to, before it issues an injunction:
    
    1. Whether there is a serious question to be tried (see Robinson v National Airlines Commission [1983] PNGLR 276);
    2. Where does the balance of convenience lie? (see Employers Federation of Papua New Guinea v Papua New Guinea Waterside Workers and Seaman's Union and Others (1982) N393;
    3. Will damages be an adequate remedy of the injunction is not issued (Employers Federation of Papua New Guinea v Papua New Guinea Waterside Workers and Seaman's Union and Others);
    4. Undertaking as to Damages (Gobe Hongu Ltd v National Executive Council (1999) N1920)
       
35. These are the four tests an applicant who wishes to apply to court for an injunction must satisfy.
    

G FINDINGS OF FACTS

36. Before I turn to applying the law to the facts, I make some findings of facts based on the evidentiary materials before me. These findings I must emphasise are for purposes of the injunction and may be contested if the matter proceeds to trial.
    
37. The first fact I find is that the Plaintiff and the First Defendant are legitimate beneficiaries of royalty payments due to landowners of the land known as Maure in which the Second Defendant conducts its mining operations. The Second Defendant does not dispute this.
    
38. The second fact I find is that the Plaintiff is a member of the Weiwei Maure clan. This is again not disputed.
    
39. The third finding I make based on the evidence of Luke Lange is that the National Court in its decision of 21 March 2018 ordered royalties to be paid by the Second Defendant in the following manner to the landowner beneficiaries:
    
    1. Maure Clan – 50%;
    2. Weiwei Maure Clan – 25%;
    3. Maure Duabo Clan – 25%
       
40. Fourthly, I make a preliminary finding that so far three royalty payments have been made to the Weiwei Maure Clan totaling K654,253.86. This amount is 25% of the total royalties that have been paid.
    
41. Sixthly, I accept the Plaintiffs evidence that of the 25% that is paid to Weiwei Clan, he is entitled to 16.66% and the First Defendant is also entitled to 16.66%. Damien Bonou is entitled to the other 16.66%, which totals to 50% of the 25% paid to Weiwei Maure clan.
    
42. Seventhly, I accept the Plaintiffs evidence that in the first payment of K166,400.46, he was supposed to receive K55,466.82, that is, his 16.66% component but he was only paid K12,000. In the second instalment to Weiwei Maure Clan of K32,000.00, he was supposed to receive K10,665.60, but he was only paid K6,000.00. In the third instalment, the Plaintiff did not receive any money at all.
    
43. If I accept the Second Defendants evidence that a total of K654,253.86 was paid to the Weiwei Maure Clan, of which the Plaintiff is entitled to 16.66%, he was supposed to receive a total of K108,998.69. From his evidence, he has only received K18,000.00.
    
44. I now turn to each of these factors in considering the circumstances of this case to determine the first Issue.
    

H ADDRESSING THE FIRST ISSUE

45. To determine the first Issue, I must consider how the facts speak to each of the four considerations relevant to the grant of injunctions.
    
    1. Serious Question to be Tried
       
46. I am reminded by what Andrew J said in Robinson v National Airlines Commission:
    

“What the plaintiff must prove is that he has a serious, not a speculative case which has a real possibility of ultimate success and that he has property or other interests which might be jeopardized if no interlocutory relief were granted.”

47. When I consider the findings of facts I have made, I ask myself what happened to the rest of the Plaintiff’s money if he is entitled to K108,998.69 of the K654,253.86 that was paid to the Weiwei Maure Clan? The Plaintiff is entitled to 16.66%. From his evidence, he has only received K18,000.00.
    
48. This has led the Plaintiff to seek an order for monies to be paid directly to him. This would raise the legal issue of whether such direct payment will affect the court order of 21 March 2020. This is a legal issue and the court should determine.
    
49. In my view there are serious questions of fact and law and the court must consider and determine.
    
50. When considering the totality of the case, I note that the Second Defendant does not dispute the legitimacy of the Plaintiff’s entitlement to the royalty. In the Second Defendant’s view, the Plaintiff should get the money after its goes to the clan account. But there is a problem there with the signatories to that account which the court must not ignore.
    
    2. Where does the balance of convenience lie?
       
51. In considering this question, I find myself asking similar questions Cannings J asked in Ewasse Landowners Association Incorporated v Hargy Oil Palms Ltd (N2878):
    

“It has always struck me that that is a rather curious form of words, meaningful probably only to lawyers. So I will try and put that time-honoured phrase into plain English. What is the best thing to do on an interim basis taking into account the conflicting interests? Where do the interests of justice lie? What will happen if an injunction is not granted? What will happen if an injunction is granted? Who will suffer the greatest inconvenience?”

52. According to the evidence as it now stands, forany future royalty being paid, the Plaintiff faces a great likelihood, neither to get his full amount or not at all. If an injunction is not granted the plaintiff may suffer further loss. This consideration therefore favours the Plaintiff.
    
    3. Will Damages Be an Adequate Remedy?
       
53. Even if damages will be an adequate remedy, the likelihood of the Plaintiff getting paid for the monies he lost is unlikely and the status quo has to be preserved in the meantime.
    
    4. Undertaking as to Damages
       
54. The Plaintiff has been directed by the court to file an Undertaking as to Damages by Thursday 28 May 2020 and has undertaken to do so.
    
55. My conclusion on the first issue is therefore that this is a case for the issuance of injunctions.
    

I ADDRESSING THE SECOND ISSUE

56. I must now consider the terms of the injunction.
    
57. Before I make this order, I have had recourse to s 155(4) of the Constitution, Order 12, rule 1 of the National Court Rules and Order 14, rule 10(3) of the National Court Rules as the basis of formulating these orders in the interest of justice. I am not making a determination of rights or interests of parties, but ensuring that a proper course is followed to ensure their rights under other laws are secured.
    
58. I adopt the statement of Deputy Chief Justice Kearney in Aihi v The State (No 1) [1981] PNGLR 81 as appropriate to the particular facts of this case:
    

“I agree with the views of Prentice C.J. and Andrew J. in Constitutional Reference No. 1 of 1979; Premdas v. Papua New Guinea...that the Constitution, s. 155(4), involves at least a grant of power to the courts. I consider that the sub-section gives unfettered discretionary power both to this Court and the National Court so to tailor their remedial process to the circumstances of the individual case as to ensure that the primary rights of parties before them are protected. And so, for example, the development of remedial process such as the Mareva injunction need not be as tortuous here as in England. But the Constitution, s. 155(4) cannot affect the primary rights of parties; these are determined by law... The Constitution, s. 155(4), cannot be used to re-create a primary right, once extinguished.”

59. I have also taken into account Cannings J observation in Ewasse Landowners Association Incorporated v Hargy Oil Palms Ltd:
    

“Although I have referred in this judgment to some rather technical legal principles, at the heart of my consideration of this application is the overriding duty of the court to do justice and to balance the conflicting interests of the parties, and also everybody who would be affected by the court’s orders.”

60. In deciding this question, I am persuaded by the Second Defendants arguments that the current means of paying the beneficiaries was in compliance with the court orders of 21 March 2018.
    
61. I also accept the Second Defendant’s explanation that the first defendant is not paid directly, but it gets paid to a clan account, in which other beneficiaries who are not parties to this case, access the monies.
    
62. An order in the terms sought by the Plaintiff may affect the rights and interests of persons who are not parties to the case.
    
63. The appropriate course is therefore to order that the monies due to the Plaintiff and First Defendant in all future royalty payment must be deducted from the monies due to the Weiwei Maure clan and be paid to the National Court Trust account until this proceeding is determined.
    
64. This will ensure that the status quo is maintained and the Plaintiff does not suffer any further loss until the proceedings are determined. It will also give an opportunity for the First Defendant to come to court and explain what happened to the rest of the money paid by the Second Defendant. Other beneficiaries not caught up in this dispute will not be affected.
    
65. I must also encourage the parties to enter into discussions to resolve this matter in the interests of all parties, and would request that this take place as a matter of priority. If the parties wish to engage the alternative dispute resolution process, thanit is also available.
    

J CONCLUSION

66. In my consideration therefore of the facts and the law and the conclusions I have reached, I make the following orders:
    
    1. Until further orders, the Second Defendant shall pay into the National Court Trust account all future royalty payment due to Isaac Yogae, the Plaintiff and Ruaize Bonou, the First Defendant, equivalent to 33.33% of the 25% benefit sharing due to Weiwei Maure Clan;
    2. For the avoidance of doubt, Order 1 above, does not affect or prevent the future royalty payment to the other members of the Weiwei Maure Clan not party to the present proceedings;
    3. The parties are to enter into negotiations to settle the matter before the next call-over in July 2020 including the possibility of utilizing the alternative dispute resolution process;
    4. The Second defendant is to file its Notice of Appearance and Notice of Intention to Defend as it deems necessary, within seven (7) days of the date of this order;
    5. Costs be cost in the cause;
    6. Time for entry of these orders is abridged to the date of settlement which shall take place forthwith before the Registrar.

___________________________________________________________

In House Lawyers: Lawyers for the Second Defendant