N8277

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS No. 341 of 2015 (COMM)

BETWEEN
MARAGO PATE for and on behalf of himself and on behalf of the Tuguba Pate Clan and Others whose names appear in Schedule A
First Plaintiffs

AND:
HELA ARAMAPIMA ASSOCIATION INC.
Second Plaintiff

AND
HON. NIXON DUBAN, as Minister for Petroleum & Energy
First Defendant

AND:
THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Second Defendant

AND
ESSO HIGHLANDS LIMITED
Third Defendant

Waigani: Anis J
2020: 20th March & 24th April

NOTICE OF MOTION – application to dismiss proceeding – Order 12 Rule 1 of the National Court Rules and section 16(1) of the Frauds and Limitations Act 1988 – time bar and abuse of process – alternative arguments for dismissal – Order 8 Rule 27(1)(a)(b) and Order 12 Rule 40(1)(a)(b) and (c) of the National Court Rules – competency arguments – alleged want of name of lawyer in the notice of motion - alleged naming of law firm in the notice of motion instead of name of lawyer – Order 4 Rue 49 (10) – National Court Rules – alleged want of pleading of the ground namely section 5 notice under the Claims by and Against the State Act 1988 – Order 4 Rule 49(8) – National Court Rules -- admissions to section 5 notice not being given – want of evidence of 5 notice being given under the Claims By and Against the State Act – exercise of discretion

Cases cited:

Muriso Pokia v. Mendwan Yallon (2014) SC 1336
Manorburn Earthmoving Ltd v. State (No.2)(2008) N3287
State and 3 others v. Brian Josiah and 80 others (2005) SC792
Soa Gabi & The State v. Kusap Nate and Ors (2006) N4020
Joe Kerowa v. MVIL (2010) SC 1100
Brian Josiah v. Steven Raphael (2018) SC1665
Asiki v Zurenouc, Provincial Administrator (2005) SC797
State v Downer Construction (PNG) Ltd [2009] SC979
Kathrine Mal v Commander, Beon Correctional Institution (2017) N6710
Boochani v State (2017) SC1643
Frederick Martins Punangi v Sinai Brown (2004) N2661
Jashim Jashim v Minister for Immigration (2018) N7187

Counsel:

Mr B Lakakit, for the Plaintiffs/Respondents
Nil appearances, for the First and Second Defendants
Mr M Tumul, for the Third Defendant/Applicant

RULING

24th April, 2020

1.	ANIS J:	On 20 March 2020, I dealt with the third defendant’s (defendant) application to dismiss the proceeding.  The application was contested.  I reserved my ruling thereafter to a date to be advised.

2.	Parties have been notified so I will rule on it now.

BACKGROUND

3.	Briefly, the plaintiffs filed this proceeding on 18 June 2015.  They seek various declaratory orders, that is, essentially challenging the legality of the PNG LNG Gas Agreement of 22 May 2006 and the Umbrella Benefits Sharing Agreement of 23 May 2009.  These agreements were signed in regard to the PNG Liquefied Natural Gas project in the Hela Province in Papua New Guinea.

MOTION

4.	The defendant’s notice of motion was filed on 30 August 2018 (application).  Two main relief are sought in the application.  The first is made pursuant to Order 12 Rule 1 of the National Court Rules (NCR) and section 16 of the Frauds and Limitations Act 1988 (F&L Act).  The defendant submits that the proceeding should be dismissed because it is time barred and therefore it was an abuse of process to commence the proceeding in the first place.  The second main relief sought is made pursuant to Order 8 Rule 27(a) and (c) and Order 12 Rule 40(1)(a)(b) and (c), of the NCR.  The defendant submits that the proceeding should be struck-out because it does not disclose a reasonable cause of action, that it is frivolous and vexatious, and that it is an abuse of court process.

5.	In regard to the second relief, the defendant states various reasons for seeking dismissal of proceeding.  One of the reasons is this.  The defendant submits that the plaintiffs had failed to give a section 5 notice under the Claims By and Against the State Act 1988 (CBASA) before they filed this proceeding.  I note that a good amount of time was spent by both counsel in addressing that.  I will therefore address that in the earlier part of my judgment.  But before I do so, let me firstly address the competency arguments.

PRELIMINARIES

6.	The plaintiffs raise two competency arguments.  Firstly, they argue that the application was not signed by the lawyer whose name appears on it, but rather, that it was signed under the name of the law firm Allens.  They argue that that is in breach of Order 4 Rule 49(10) of the NCR.  Their second competency argument relates to the second relief.  The plaintiffs submit, and I quote in part, “The Notice of Motion is not premised on Section 5 of the Claims By and Against the State Act 1996.  The applicant is required to particularize and or plead in the Notice of Motion that the Application is made pursuant to Section 5 of the Claims By and Against the State  and merely pursuant to Order 12 Rule 40 is too general.  Order 4 Rule 49(8) of the National Court Rules requires that the legal foundation for such application must be concisely referenced so as to invoke the Courts jurisdiction to grant the orders sought.  Therefore, it failed to comply with Order 4 Rule 49(8) of the National Court Rules.”

7.	The defendant argues that its application is competent.  In relation to the argument concerning the signing of the application, Mr Tumul submits that the signature in the application was his.  He submits that it was he that had signed the application in place of or for David Hill, before it was filed.  He submits that he had indicated that by the use of the word “for” which he had hand-written next to the name, ‘David Hill’.  He submits therefore that the application was not signed under the name of or by the law firm as alleged by the plaintiffs.

8.	Let me deal with the first argument.  Order 4 Rule 49(10) states, and I quote:

10.	Signing of Motions.
The Motion must be signed by the lawyer or applicant and the name of the lawyer or party must appear below the signature. The Motion cannot be signed by the Law firm as it is incapable of having a signature.
……

9.	I have considered the submissions of counsel.  At the hearing, I note that Mr Tumul appeared to have clarified the confusion concerning the signature on the application.  It was Mr Tumul that signed off on the application and not David Hill, that is, despite David Hill’s typed out name appearing below Mr Tumul’s signature.  But that aside, I note that there appears to be a misstatement of a fact that exists with this argument.  Let me explain.  The application does not only state the name of the law firm as alleged.  Rather, it pleads the name of the lawyer which is ‘David Hill’ together with the name of the law firm, Allens.  It is therefore not correct, in my view, for the plaintiffs to claim that the application only had the name of the law firm and not the name of the lawyer.  That said, let me now deal with the argument.  The application in this case was signed off by a lawyer, namely, Mr Tumul.  He signs off with a hand-written notation that reads, for, which is then followed by a typed out words that read, David Hill of Allens Lawyers for the Third Defendant.  So the name of the lawyer is actually stated in the application.  The fact that Mr Tumul or a lawyer had to sign off for another lawyer on the application or a notice of motion, is not, in my view, an uncommon practice, particularly with larger law firms.  Given the large number of lawyers employed, a single file for a matter may be dealt with by several lawyers in the firm, who may sign or witness court documents or appear in Court, for their client or clients.  Sometimes, a lawyer having carriage of the file may have the permission from the managing partner to sign-off on a document on his or her behalf or on behalf of the firm, but of course, that would be an internal matter for the said law firm which is beyond the argument that is raised before me.  With that, I must say that the application is not defective, that is, it does not breach Order 4 Rule 49(10) of the NCR.  However, let me say this.  If for example, Mr Tumul simply writes down the name Allens or if only the name Allens is typed out at where the signature should be on the notice of motion, then the notice of motion would, in my view, be regarded as defective or that it would be in breach of Order 4 Rule 49(10) of the NCR.  The other example where I could find the application defective or incompetent under Order 4 Rule 49(10) is if the person that signs the notice of motion cannot be identified, or if he or she is not a lawyer in the employ of the law firm that acts for the applicant or the party concerned.

10.	I therefore dismiss the plaintiff’s first competency argument.

11.	I turn to the second argument.  Order 4 Rule 49(8) states, and I quote, 

8.	Form of Motions.
All Motions must contain a concise reference to the Court’s jurisdiction to grant the orders being sought. Motions not containing such reference will not be accepted for filing. If accepted by the Registry staff without such reference, and it goes before the motions judge, the Court may strike out the motion for being incompetent and for lack of form.

The motion must state the following;
"...move the Court for Order pursuant to (e.g. section 5 of the Claims By and Against the State Act...) ..."
……

12.	I will say this.  I cannot see anything fundamentally wrong with the sources that the defendant is relying on.  The defendant, I note, is asking the Court to invoke its powers under Order 8 Rule 27(a) and (c) and Order 12 Rule 40(1)(a)(b) and (c), of the NCR, and dismiss the proceeding.  These rules refer to the Court’s jurisdiction to strike out a pleading or dismiss a proceeding based on various reasons including, (i), want of reasonable cause of action or defence, (ii), prejudice, (iii), embarrassment or delay, (iv), frivolity and (v) abuse of process.  The plaintiff, as stated above, submits that the defendant should have but has failed to plead section 5 of the CBASA in its application.  Pleading a detailed ground should be, in my view, optional.  For example, for one to plead that the proceeding should be dismissed for not disclosing a reasonable cause of action should be sufficient.   To argue want of compliance of section 5 notice is, in my view, a reason or a basis why the defendant is asking the Court to dismiss the proceeding.  It is not a source or jurisdictional basis that a party can ask the court to invoke to, for example, dismiss the proceeding.  The reasons or basis as pleaded therein, namely, want of reasonable cause of action, frivolity and abuse of process, are, in my view, sufficient.  And I note the want of section 5 notice under the CBASA is not the only reason that is intended to be relied upon by the defendant under the second relief.  Other reasons include want of primary rights, want of capacities to act and want of standing.

13.	Let me also say this.  Since the Court’s power herein is wide or discretionary, I may also dispense with such a requirement, for example, if I am satisfied that the parties have been notified or were aware of the reasons before coming to Court to argue the matter.  In the present case, I note that Mr Tumul has referred the Court to his earlier affidavit which was filed on 10 December 2019.  Annexure A to the affidavit contains copy of a letter from his firm dated 1 March 2019, which had been sent to the plaintiffs’ former lawyers Tamutai Lawyers.  The said letter I note informs the plaintiffs of the defendant’s intention to argue section 5 of the CBASA.  See case:  Muriso Pokia v. Mendwan Yallon (2914) SC 1336.  So I note that the plaintiffs have in fact been put on notice regarding the defendant’s intention to raise the argument under section 5 of the CBASA.  This piece of evidence also suggests to me that the plaintiffs may have been disingenuous with their argument.  

14.	With these, I also dismiss the second competency argument.

COMMON GROUND

15.	Towards the end of the presentation of submissions, this is what the plaintiffs’ counsel had to say when he was addressing costs.  Counsel submitted that if the Court was minded to dismiss the proceeding, then each party should bear their own costs.  Counsel then acknowledged the fact that the plaintiffs had failed to give a section 5 notice under the CBASA before they commenced the proceeding.  Counsel however submitted that the plaintiffs were lay persons, and as such, they should not be ordered to pay the costs of the proceeding.  Counsel further submitted that the negligent act, that is, for not giving the section 5 notice pursuant to the CBASA, was not the plaintiffs’ doing but rather was their former lawyers’, and as such, he impliedly submitted that the plaintiffs should therefore not be punished with a cost order made against them.

16.	In my view, the plaintiffs therefore do not deny that they had failed to give the section 5 notice before they filed this proceeding.  I also note that the plaintiffs did not call any material evidence to show that such a notice had been given.  And I note that the submissions by their counsel confirms this fact.

17.	That said and on a different note, the plaintiffs raise a challenge that is based on law.  Counsel submits that since the section 5 notice argument was not raised in the earlier stages of the proceeding by the defendants, the defendants are now estopped from raising it.  Counsel refers to and relies on the case of Manorburn Earthmoving Ltd v. State (No.2)(2008) N3287.  Counsel submits that in that case, the Court held that the State was estopped by its own conduct from raising the section 5 notice argument.  The Court noted that the State had chosen or opted not to raise the argument in the earlier stages of the proceeding.  Counsel also referred on the Supreme Court case, State and 3 others v. Brian Josiah and 80 others (2005) SC792.  The case had been relied upon by trial Judge in his ruling in Manorburn.

18.	The first dilemma I have with Manorburn’s case is the estoppel argument, and I would, with respect, differ.  Estoppel is founded in common law and equity.  These laws form part of the underlying law which is part of the laws that are recognized under the Constitution of Papua New Guinea (Constitution).  Section 9 of the Constitution states, and I quote:

9.	The laws.

The laws of Papua New Guinea consist of—
(a)	this Constitution; and
(b)	the Organic Laws; and
(c)	the Acts of the Parliament; and
(d)	Emergency Regulations; and
(da)	the provincial laws; and
(e)	laws made under or adopted by or under this Constitution or any of those laws, including subordinate legislative enactments made under this Constitution or any of those laws; and
(f)	the underlying law,
and none other.

19.	As it is, the underlying law is ranked lower than an Act of Parliament.  In Soa Gabi & The State v. Kusap Nate and Ors (2006) N4020, Justice Injia, as he then was, stated at paragraph 57,  I quote, In my view, the law is very well settled in this jurisdiction that the equitable doctrine of estoppel cannot override clear mandate of statutory law.  Equity cannot override statutory law.  Equity simply follows the law.  For this reasons, whilst it is true that the State had settled a number of NLC awards made without jurisdiction; a Court of law cannot ignore clear breaches of the law once the breach is brought to its attention.  For this reason, I dismiss the respondent’s arguments on estoppel.  The position in law, was later held by the Supreme Court in the case, Joe Kerowa v. MVIL (2010) SC 1100.  Despite want of reference to Soa Gabi & The State v. Kusap Nate (supra), the Supreme Court stated and I quote, After considering the submissions of counsel and the various authorities referred to, we are of the view that an estoppel cannot be invoked in respect of a statutory condition precedent. Consequently, the Appellant is not able to succeed. Given this finding it is not necessary to consider the other submissions of counsel.

20.	The decision is of course binding upon this Court.  

21.	Section 5, under the CBASA and in this instance, is a superior provision, and it imposes a statutory condition precedent for commencing an action against the State.  It expressly requires a person that wishes to sue the State, to give written notice of his, her or its intention to sue, within 6 months after the occurrence out of which the claim arose, or in the case of a contract, within 6 months after the person becomes aware of the alleged breach.  See section 5(1) and (2) of the CBASA.  The present action is founded in (i), contract, (ii), in tort, that is, for alleged breach of provisions of the Oil and Gas Act 1998, and also (iii), for alleged breach of constitutional provisions and rights.  There is a long list of case authorities from both the Supreme and National Court, which have addressed section 5 of the CBASA.  The case law on this point is settled.  It states that compliance with a section 5 notice is mandatory beforehand or before one could commence an action against the State.  A more recent case is the Supreme Court’s decision in Brian Josiah v. Steven Raphael (2018) SC1665.  The Supreme Court stated, and I quote: 

23.	Section 5 of the Claims Act makes it a mandatory legal obligation or condition precedent on a plaintiff commencing a claim against the State to give notice of his intention to make a claim against the State and a failure to comply with that obligation is fatal: Paul Tohian, Minister for Police and the State v. Tau Liu (1998) SC566 and Daniel Hewali v. Papua New Guinea Police Force & The State (2002) N2233. Therefore it follows that commencement of court proceedings against the State pre-supposes that due compliance with s. 5 was achieved.

22.	Also, and in the leading case, Asiki v Zurenouc, Provincial Administrator (2005) SC797, the Supreme Court held, and I quote in part, (1) The notice requirements of the Claims By and Against the State Act apply only to actions that are founded on contract or tort or breaches of constitutional rights.  Other cases include, State v Downer Construction (PNG) Ltd [2009] SC979, Kathrine Mal v Commander, Beon Correctional Institution (2017) N6710, Boochani v State (2017) SC1643, Frederick Martins Punangi v Sinai Brown (2004) N2661 and Jashim Jashim v Minister for Immigration (2018) N7187. 

23.	But having said these, I have to ask myself this.  What about the plaintiffs’ reference to the Supreme Court case of case, State and 3 others v. Brian Josiah and 80 others (supra)?  Well firstly, I would follow the above line of authorities which are also binding upon this Court.  The second reason is this.  In Brian Josiah’s case, the Supreme Court actually recognized the mandatory requirement of section 5 under the CBASA.  It however found that the provision was not pleaded; that it had not been raised earlier by the State, and further, that the trial judge had actually dealt with the issue.  I refer to the part where the Supreme Court said, and I quote:

Whilst we accept the requirement to give notice of intention to make a claim against the State to be mandatory, we do not consider that the learned trial judge made any error in that regard for the simple reason that it was for the appellant to have raised the issue through the pleadings. The Appellant failed to do so even though it had had more than ample opportunity to have done so. The first opportunity was during the ordinary course of pleadings after the writ was served on it through the office of the Solicitor General and secondly, after an extension of time of 7 days was granted to it by Kandakasi J. It cannot now complain that the learned trial judge failed to properly consider the provisions of that Act.   

(Underlining is mine)

24.	I therefore do not see that the Supreme Court’s decision in Brian Josiah’s case differs from or is inconsistent, with the mandatory requirement under section 5 of the CBASA and the long line of case authorities on point.  The plaintiffs’ argument therefore fails.

SUMMARY

25	In conclusion, I find that the plaintiffs failed to give a section 5 notice under the CBASA to the State, before they commenced the proceeding.  As such, the proceeding shall fail on the basis of want of reasonable cause of action, frivolity and an abuse of court process.  I will dismiss the proceeding.

26.	Because of my decision, I see no need to proceed further to deal with the other issues that have been raised in the application.

COST

27.	An award of cost in this instance, is discretionary.  

28.	As for this case, I intend to award cost to follow the event.  With respect, I do not see any valid reason to deviate from that.  I note that the plaintiffs tend to blame their former lawyers for not giving a section 5 notice to the State beforehand.  In my view, that may be a separate matter between them and their former lawyers if they wish to pursue or go down that path.  But it cannot, in my view, be a good reason for me to simply excuse them for their actions.  To do so, would be most unfair on the defendants.  The plaintiffs have obviously committed and caused the defendants to incur legal costs to defend themselves in the matter.  It is therefore only fair that the plaintiffs should be ordered to pay the defendants’ costs of the proceeding.  In this case, I will order the plaintiffs to pay the defendants’ costs of the proceeding on a party/party basis to be taxed if not agreed.

THE ORDERS OF THE COURT

29.	I will make the following orders:

1.	The proceeding is dismissed.

2.	The plaintiffs shall pay the defendants’ costs of the proceeding on a party/party basis which may be taxed if not agreed.

3.	Time for entry of these orders is abridged to the date of settlement by the Registrar which shall take place forthwith.

The Court orders accordingly.

______________________________________________________________

Lakakit & Associates Lawyers:	Lawyers for Plaintiffs
Allens:	Lawyers for the Third Defendant