Puara v Andagali [2021] PGNC 446; N9210 (1 October 2021)

N9210

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

WS NO. 1402 OF 2019 (CC2)

BETWEEN:
RICHARD PUARA
Plaintiff

AND:
LARRY ANDAGALI
First Defendant

AND:
TRANS WONDERLAND LTD
Second Defendant

AND:
NOU NOU
Third Defendant/First Cross-Claimant

AND:
KAEVAGA INCORPORATED LAND GROUP
Fourth Defendant/Second Cross-Claimant

AND:
LAND TITLES COMMISSION OF PAPUA NEW GUINEA
Second Cross-Defendant

AND:
INDEPENDENT STATE OF PAPUA NEW GUINEA
Third Cross-Defendant

Waigani: Shepherd J
2020: 16^th October
2021: 1^st October

PRACTICE AND PROCEDURE – notice of motion by plaintiff for interim injunctions to restrain defendants and Surveyor General from dealing with registered survey plan pending final determination of proceeding – Order 14 Rule 10(1) National Court Rules – considerations – interim injunctions granted to preserve status quo pending trial - notice of motion by certain defendants seeking leave to file amended defence and cross-claim out of time – Order 8 Rule 50(1) National Court Rules – considerations – application for leave refused as the proposed amendments to the existing defence and cross-claim would not enable the Court to determine the real issues in controversy between the parties.

Cases Cited:
Chief Collector of Taxes v Bougainville Copper Ltd (2007) SC853
Eki Investments Ltd v Era Dorina Ltd (2006) N3176
Golobadana No. 35 Ltd v Bank of South Pacific Ltd (2002) N2309
Kerowa v Hargy Oil Palms Ltd (2012) SC1194
Kewa v Kombo (2004) N2688
Niap v PNG Harbours Ltd (2009) N3672
The Papua Club Inc. v Nusaum Holdings Ltd (2002) N2273

Counsel:

Mr Nemo Yalo, for the Plaintiff/First Cross-Defendant
Mr George Lau, for the First & Second Defendants
Mr Peter Hai Pato, for the Third & Fourth Defendants/Cross-Claimants

DECISION

1^st October, 2021

1. SHEPHERD J: This is a decision on two contested motions which are before the Court. The first motion is an application by the plaintiff seeking interim injunctions to restrain the defendants and the Surveyor General from dealing with a registered survey plan of land, title to which land is in dispute between the main parties, pending the final determination of this proceeding. The second motion is an application by the third and fourth defendants seeking leave to file an amended defence and cross-claim out of time.

Background

2. The plaintiff (Mr Puara) commenced this litigation by the filing of his writ of summons and statement of claim on 31 October 2019. An amended statement of claim was filed by the plaintiff on 25 February 2020 with the consent of all parties.
3. Mr Puara by his amended statement of claim pleads that he is the registered proprietor of all that freehold land comprising an area of 2.03 hectares known as Portion 3959c Milinch of Granville, Fourmil of Port Moresby, National Capital District being all the land described in Certificate of Title Volume 37 Folio 248.
4. Mr Puara’s amended statement of claim alleges that on 23 December 2016 the third defendant (Mr Nou) on behalf of himself and the fourth defendant (Kaevaga ILG) executed a contract for the sale to Mr Puara of the subject land, which forms a part of customary land known as Begadaha near the turn-off to Motukea Wharf on the road leading to Napa Napa Oil Refinery not far from Port Moresby.
5. In March 2018 the Land Titles Commission granted a conversion order to Mr Puara pursuant to the Land (Tenure Conversion) Act 1963 permitting him to acquire the subject land, then identified as Begadaha Portion 3959c, from Kaevaga ILG. This resulted in the issuance by the Registrar of Titles of Certificate of Title Volume 37 Folio 248 in favour of Mr Puara on 17 October 2018. The Certificate of Title was issued subject to conditions and restrictions imposed by the Land (Tenure Conversion) Act 1963. The Certificate of Title states that a registered survey plan for the subject land is contained in catalogue plan no. 49/3739 held by the Department of Lands and Physical Planning at Waigani, National Capital District.
6. However, on 20 June 2019 Kaevaga ILG executed a second contract, this time for the sale of a greater part of Begadaha customary land to the second defendant, Trans Wonderland Ltd (TWL). The land which was sold to TWL included Portion 3959c, which Mr Puara asserts had already been sold to him by Kaevaga ILG.
7. Mr Puara’s amended statement of claim pleads to the effect that on or about 2 September 2019 agents or employees of the defendants wrongfully entered and encroached onto Portion 3959c and destroyed almost 20,000 meters of fencing which Mr Puara had constructed on the perimeter boundary for his land. Agents or employees of the defendants then dug up and removed the concrete survey pegs which delineated the boundary for the land. They then bulldozed the entire area, dug up trenches and did further earthworks which altered the contour of the land at Portion 3959c.
8. Mr Puara by his amended statement of claim is seeking damages against TWL and its managing director the first defendant Larry Andagali for trespass to Portion 3959c and damages for mental anguish sustained by Mr Puara. The amended statement of claim also seeks interim and permanent injunctions against the defendants to prevent further encroachment and interference with the land at Portion 3959c.
9. On 14 February 2020 Mr Nou and Kaevaga ILG were joined by order of this Court as third defendant and fourth defendant respectively to this proceeding. This was followed by the filing of Mr Puara’s abovementioned amended statement of claim on 25 February 2020, which expanded Mr Puara’s claim against Mr Andagali and TWL to include Mr Nou and Kaevaga ILG.
10. On 20 March 2020 this Court granted interim orders restraining TWL and members of the Kaevaga ILG and Kaevaga Clan from entering onto Portion 3959c and restraining the parties from harassing each other regarding matters in issue in this proceeding.
11. An appeal against the interim restraining orders of 20 March 2020 was filed by Mr Andagali and TWL in the Supreme Court on 6 June 2020. However, this appeal was subsequently withdrawn by Mr Andagali and TWL on 28 July 2020 after Justice Cannings dismissed their application for a stay of the interim restraining orders pending final determination of the appeal, primarily on the basis that the appeal had no prospect of success.
12. The case then reverted back to the National Court and on 16 October 2020 this Court heard the two motions which are the subject of this decision.

APPLICATION BY MR PUARA FOR INTERIM INJUNCTIONS TO RESTRAIN THE DEFENDANTS AND SURVEYOR GENERAL FROM TAKING STEPS TO CANCEL OR ALTER SURVEY PLAN CATALOGUE NO. 49/3739

13. Mr Puara relies on Order 14 Rule 10(1) of the National Court Rules (NCR) as the source of the jurisdiction for the Court to restrain all four defendants and the Surveyor General from taking further steps to alter or cancel survey plan catalogue no. 49/3739 pending the outcome of this proceeding.

Relevant Law – Interim Injunctions

14. Order 14 Rule 10(1) NCR provides:

10. Preservation of property

(1) In proceedings concerning any property, or in proceedings in which any question may arise as to any property, the Court may make orders for the detention, custody or preservation of the property.

15. The use of the permissive word “may” in Order 14 Rule 10(1) clearly indicates that the power of the Court to grant orders by way of interim injunction for the preservation of property is discretionary.
16. The primary legal principles which guide the Court’s consideration when determining whether to grant an interim injunction, including interim orders to preserve property, are well settled: see for example Golobadana No. 35 Ltd v Bank of South Pacific Ltd (2002) N2309; Chief Collector of Taxes v Bougainville Copper Ltd (2007) SC853.
17. The parties before the Court in this instance all concur that an applicant seeking an interim injunction must show that:
    • (1) There are serious questions to be tried and that an arguable case exists.
    • (2) An undertaking as to damages has been given.
    • (3) Damages would not be an adequate remedy if the interim order is not granted; and
    • (4) The balance of convenience favours the granting of the interim order.

Relevant Considerations

(1) Are there serious questions to be tried and does an arguable case exist?

18. Mr Puara asserts that he has a clear title to the subject land known as Portion 3959c to the exclusion of all others by virtue of his Certificate of Title Volume 37 Folio 248 for Portion 3959c issued by the Registrar of Titles on 17 October 2018, a copy of which Certificate of Title is attachment no. 5 to annexure “I” of Mr Puara’s affidavit filed on 24 September 2020.
19. Mr Puara relies on survey plan catalogue no. 49/3739 referred to in Certificate of Title Volume 37 Folio 248 as delineating the legal boundaries of the subject land which comprises 2.03 hectares. A copy of that survey plan is annexure “D” to Mr. Puara’s affidavit filed on 24 September 2020.
20. Against this, TWL asserts that survey plan catalogue no. 49/3739 was cancelled by the Surveyor General and replaced by new survey plan catalogue no. 49/3917 to reflect the 20.41 hectares of land which TWL says it purchased from Kaevaga ILG under its contract with that ILG dated 20 June 2019 and which the Surveyor General has named as Portion 4251C, Milinch Granville, Fourmil Moresby, National Capital District. TWL, supported by its three co-defendants, argues that because the legal description “Portion 3959c” referred to in Certificate of Title Volume 37 Folio 248 held by Mr Puara no longer exists because it has been cancelled by the Surveyor General, the Certificate of Title is itself therefore defective.
21. Mr Puara strenuously rejects this contention by TWL and its co-defendants. Annexed to Mr Puara’s affidavit filed on 24 September 2020 and marked “I” is a letter dated 7 September 2020 written by Mr Puara’s lawyer, Mr Nemo Yalo, to Mr Lionel Jarigi who is the registered surveyor that was engaged by TWL to survey the 20.41 hectares of land which has become known as Portion 4251C. In that letter, Mr Yalo posed the following four questions to Mr Jarigi:
    1. Is Mr Puara’s survey plan Cat No. 49/3739 current and not cancelled?
    2. If Mr Puara’s survey plan Cat No. 49/3739 has been cancelled, did you comply with the established legal and administrative procedures?
    3. If you cancelled Mr Puara’s survey plan, what was the legal basis for doing so?
    4. Did you conduct due diligence prior to registering a new survey plan which you say on record “supersedes” Mr Puara’s survey plan No. Cat 49/3739?
22. On 12 September 2020 Mr Jarigi responded to Mr Yalo’s letter of 7 September 2020. A copy of Mr Jarigi’s letter in response is annexure “J” to Mr Puara’s affidavit. In his letter of 12 September 2020, Mr Jarigi set out his answers to Mr Yalo’s four questions as follows:

“1. Is Mr Puara’s survey plan cat. 49/3739 current and not cancelled?

The cat. 49/3739 not cancelled, if it was cancelled, Survey General would have informed me with the cancellation copy.

2. If Mr Puara’s survey plan cat. 49/3739 has been cancelled, did you compile [sic] with the established legal and or administrative procedures”

The cancellation of survey plan, the power rest with the Survey General, after receiving all relative evidence from all parties concerned.

3. If you cancelled Mr Puara’s Survey plan, what was the legal basis for doing so?

(As stated in point 2)

4. Did you conduct due diligence prior to registering a new survey plan which you say on record “supersedes” Mr Puara’s survey plan cat. 49/3739?

The registration of survey plan 49/3917 was in consultation with the Regional Surveyor, the Survey General, the land owners of Kaevaga ILG. After the landowners given their consent letter to the Surveyor General, then I was informed to incorporate portion 3959C into the new survey which enables the survey plan 49/3739 to be superseded.”

23. It is clear from Mr Jarigi’s answers to Mr Yalo’s questions that as at the date of Mr Jarigi’s letter, 12 September 2020, it was Mr Jarigi’s position that survey plan catalogue no. 49/3793 had not been cancelled by the Surveyor General. Instead, Mr Jarigi considered that survey plan catalogue no. 49/3793 for Portion 3959c referred to in Certificate of Title Volume 37 Folio 248 had been “superseded” by the Surveyor General’s registration of survey plan catalogue no. 49/3917 for new Portion 4251C for the 20.41 hectares which TWL asserts it has purchased from Kaevaga ILG, which includes the pre-existing Portion 3959c for 2.03 hectares which Mr Puara says he purchased from Kaevaga ILG.
24. What is not clear from Mr Jarigi’s answers to Mr Yalo’s questions, and has not yet been properly explained to this Court, is the significance in law of a registered survey plan which has been “cancelled” by the Surveyor General as distinct from the legal status of a registered survey plan which has “superseded” a non-cancelled earlier survey plan for a smaller portion of land that has been included in a larger portion of land covered by a survey plan registered later in time.
25. The submission of TWL on this point seems to be that because the Surveyor General has omitted to put an official cancellation stamp on the copy of registered survey plan catalogue no. 49/3739, this does not affect the alleged invalidity of Mr Puara’s Certificate of Title Volume 37 Folio 248 because the Surveyor General’s omission can be regarded as a formality, a mere oversight on the part of the Surveyor General.
26. I do not accept this submission, certainly not in the absence of expert evidence and full and proper argument on this important issue at substantive hearing.
27. In any event, the conclusion of the written submission for counsel for TWL and Mr Andagali as to whether there is a serious question to be tried in this proceeding unequivocally states at paragraph [11]: “Basically the Plaintiff’s Title is in dispute”. To my mind, this is an admission that Mr Puara does indeed have an arguable case. I am satisfied that there are serious questions to be tried in this proceeding and that Mr Puara has an arguable case which can only be resolved at substantive hearing.
2. Has an undertaking as to damages been given?
28. Mr Puara’s undertaking as to damages in respect of his present application for interim injunctions was filed on 24 September 2020. The undertaking is signed by Mr Puara and is dated 22 September 2020. It is in a form and content acceptable to this Court. The undertaking states:

“The Applicant undertakes to submit to such Order(s) as the Court may consider to be just for the payment of damages to be assessed by the Court or as it may direct for the Defendants if it shall be later found that the Defendants have been adversely affected by the operation of any Interlocutory Order(s) made in the proceeding in favour of the Applicant.”

3. Would damages not be an adequate remedy if the interim order is not granted?
29. TWL contends on behalf of the defendants that TWL has made available to Mr Puara a cheque for K150,000 by way of refund of the 50% deposit which Mr Puara paid to Mr Nou and Kaevaga ILG. That refund cheque has not been accepted by Mr Puara. The defendants seemingly assert that if Mr Puara were to accept that refund then this would be sufficient to restore the status quo ante. TWL at paragraph [14] of their counsel’s submission asserts to the effect that damages would be an adequate remedy to compensate Mr Puara’s claims against the defendants if the interim injunctions now sought by Mr Puara were not granted. Furthermore, the defendants argue that the interim injunction granted on 20 March 2020 which restrained TWL and its co-defendants from entering onto Portion 3959c has unnecessarily prevented TWL from developing its project worth millions of kina for the 20.41 hectares of land in Portion 4251C, which incorporates the 2.03 hectares in Portion 3959c. In my view this argument does not address the central issue as to whether damages would not be an adequate remedy if the defendants and the Surveyor General were to be restrained by interim injunctions from dealing further with survey plan catalogue no. 49/3739.
30. Mr Puara submits that he does not wish to forgo what he argues is valid title to Portion 3959c evidenced by Certificate of Title Volume 37 Folio 248. He wants to retain title to that land. He says that damages for loss of that land would be wholly inadequate. He alleges conspiracy and criminal conduct on the part of all defendants to divest him of title to the land. He argues that just because TWL could afford to pay damages if he were to lose title to Portion 3959c, this is not a relevant consideration, given the circumstances by which he obtained title via the conversion order made by the Land Titles Commission on notice to Kaevaga ILG and its members. What Mr Puara is seeking by his present motion before the Court is to restrain the defendants and the Surveyor General from taking any steps or further steps to alter or cancel the registered survey plan of the land to which his title relates. If the interim injunction were not to be granted and the Surveyor General were to cancel registered survey plan catalogue no. 49/3739 or if the defendants were to pressure the Surveyor General to do so at this juncture, this would unduly compound what is already a complicated legal issue which has, along with other issues raised by Mr Puara and the defendants, yet to be determined by this Court.
31. I find that given the particular circumstances of this case, the defendants have not satisfied the Court that damages would be an adequate remedy if the interim injunctions sought by Mr Puara were to be refused.
4. Does the balance of convenience favour the granting of the interim orders sought by Mr Puara?
32. TWL argues that the balance of convenience does not favour the granting of the interim injunctions sought by Mr Puara. TWL says that it already had improvements over the 2.03 hectares prior to Mr Puara filing this proceeding. TWL says at paragraph [12] of its counsel’s submission that Mr Puara does not have any single improvement on the 2.03 hectares despite having a certificate of title. The ready answer to that is that it is undisputed by the defendants that the improvements which Mr Puara did have on the land, namely almost 20,000 meters of fencing, which cost Mr Puara in the vicinity of K20,000, were demolished when TWL arranged for bulldozers to enter the land in September 2019. This is not a valid argument for the balance of convenience to favour the defendants instead of Mr Puara.
33. Rather, the interim injunctions sought by Mr Puara would, if granted, preserve the status quo pending the final determination of this case. The legal validity or otherwise of survey plan catalogue no. 49/3739 insofar as it affects Mr Puara’s title to the land is one of the issues at the very heart of contention in this proceeding and, unless that issue is settled by the parties, it is a core issue that can only be determined by this Court at substantive hearing of all relevant evidence and comprehensive submissions for the parties.
34. For the reasons given, the interim injunctions sought by Mr Puara to restrain all four defendants and the Surveyor General from taking any steps or further steps to alter or cancel survey plan catalogue no. 49/3739 will be granted. Costs will follow the event.
    

APPLICATION BY MR NOU AND KAEVAGA ILG FOR LEAVE TO AMEND THEIR DEFENCE AND CROSS-CLAIM

The Parties’ Evidence

35. The reason for Mr Nou and Kaevaga ILG’s motion to amend their defence and cross-claim filed on 25 September 2020 is given in Mr Nou’s affidavit filed on the same date. Mr Nou states in his affidavit that his lawyers have ascertained that for a registered certificate of title to a property to be set aside, one must first establish fraud as a ground. The existing and cross-claim which was filed by the lawyers for Mr Nou and Kaevaga ILG is currently founded on alleged breaches of the Land (Tenure Conversion) Act 1963. Mr Nou says he has therefore instructed his lawyers to make the present application to seek leave to amend the defence and cross-claim to plead fraud as a ground so that Mr Puara’s Certificate of Title Volume 37 Folio 248 can be declared null and void on that ground.
36. Annexed to Mr Nou’s affidavit is a draft amended defence and cross-claim which pleads particulars of alleged fraud, including fraud pleaded to have been committed by Mr Puara acting in collusion with the Land Titles Commission and its Acting Commissioner in order for Mr Puara to have obtained his Certificate of Title. These are serious allegations.
37. The following are instances of the fraud alleged by Mr Nou and Kaevaga ILG against Mr Puara, the Land Titles Commission and LTD Acting Commissioner Mr Paonga which would be pleaded by Mr Nou and Kaevaga ILG if leave were to be granted by this Court for their draft amended defence and cross-claim to be filed out of time:

Draft Amended Defence

4. The Third and Fourth Defendants deny paragraphs 7 and 8 [of the Plaintiff’s amended statement of claim] and repeat paragraph[s] 1.1 – 1.3 inclusive, and further say that the Plaintiff obtained the conversion order from the Second, Third and Fourth Cross-Defendants through fraud in that the conversion was granted in breach of the Land (Tenure Conversion) Act 1963 “hereinafter the Act”, hence the Certificate of Title is void ab initio.

...

5.4 The Third and Fourth Defendants never sold any part of their customary land within the Sasiva landmass to the Plaintiff under any form of agreement or contract whatsoever. A consent agreement purported [sic] executed on the 13^th November, 2017 by the members of the Kaevaga ILG is a document fraudulently created by the Plaintiff. The Third and Fourth Defendants have no knowledge of the existence of this document.

Draft Amended Cross-Claim

2. ... The only way [the First Cross-Defendant Mr Puara] could acquire a conversion order and registration of title of the customary land would be by fraud through collaboration with the Third Cross-Defendant [Acting Land Titles Commissioner Mr Kutt C. Paonga].

3. The conversion order granted in favour of the First Cross-Defendant [Mr Puara] from which he acquired the Certificate of Title of freehold lease over the subject Bega Daha land is null and void, therefore illegal ab initio as the conversion was made through fraud in that relevant provisions of the Act were breached.

[underlining as per the draft amended defence and cross-claim]

38. On 9 October 2020 Mr Puara filed a detailed affidavit in answer to the allegations of fraud proposed to be pleaded by Mr Nou and Kaevaga ILG if leave were to be granted by this Court for their amended defence and cross-claim to be filed. Mr Puara’s affidavit extends to five pages. It contains comprehensive refutations by Mr Puara of the allegations of fraud proposed to be pleaded by Mr Nou and Kaevaga ILG.
39. Set out below are extracts from Mr Puara’s affidavit:

“4. Mr Nou is accusing me of uttering the “Consent Agreement” dated 13 November 2017 signed by him and his colleague landowners. This document Is Annexure “PR13” annexed to my affidavit sworn on 16 and filed on 17 December 2019, court doc. #16.

...

6. On 21 September 2017 I submitted my application for Conversion Order dated the same date using an Application for Registration form supplied to me by the LTC. I attached a copy of the Contract for Sale of Customary Land (Contract for Sale) which I executed with Nou and his Kaevaga ILG representatives on 23 December 2017. I beg to refer the Court to Annexure “01” annexed to my affidavit sworn on 16 and filed on 17 December 2017, court doc. #16.

...

8. In the morning of 13 November 2017 an officer from LTC called me to advise that in addition to the Contract for Sale, LTC required a consent agreement executed by the Kaevaga Landowners as a further proof that they have consented to selling their customary land to my company. I immediately drove to Mr Nou in his Sasiva/Motukea Village and explained the LTC requirements.

9. Mr Nou wanted to instruct his lawyer Mr Glenn Jerry to draft the consent agreement. So I drove Nou and his brother Morea Nou to Mr Jerry’s office located behind the Post Courier along Lawes Road, in Konedobu.

10. Mr Jerry drafted the consent agreement, however Nou did not have the proper copy of the Kaevaga ILG Letterhead. The ILG Chairman Haraka Borema and his brother Nau Borema the ILG Secretary usually kept the Letterheads. Mr Nou could not ask for it because he had an ongoing conflict with them and even if he asked thy would not give it to him.

11. Both Glenn and Nou decided that I should draft a new letterhead for our purposes and I would print the consent agreement for Nou and his clan leaders to sign. Glen[n] drafted the contents of the consent agreement, copied it onto a flash drive and gave it to me to print. I drafted a new Kaevaga ILG Letterhead upon consent from Nou and printed the Consent Agreement drafted by Mr Jerry.

12. In the afternoon of the same day, I drove to Nou in his village and handed him the Consent Agreement. As I waited in my car Mr Nou took the document house to house to the clan leaders to sign. Some leaders were at Baruni so I drove him to Baruni where Morea Nou and Rahe Rahe signed. Since Dabada Arua Kobua was the only one yet to sign but was not in the village Nou called him on his mobile number. Mr Kobua advised that he was in Brown River on duty. Because the time was about 4:00pm and it was late I advised Nou to keep the document for Mr Kobua to execute and I drove back to the city.

13. On the next day, I called Nou and checked on the agreement. He advised that all had signed so I could collect it from him in his village. I drove to his village and picked up the document. At that point he asked me to draft a cover letter on the new Kaevaga ILG Letterhead that I had created so that he could sign. I drove back to the city, drafted Nou’s cover letter and returned to Nou in his village and he signed his letter. Thereafter I attached the Consent Agreement to Nou’s cover letter and took it to the LTC office and lodged them there.

True copies of the Consent Agreement and Nou’s cover letter are annexed hereto and are marked as Annexure “B”.

14. I did not initiate the Consent Agreement on my own and forge the signatures appearing on that document or even forged Mr Nou’s signature appearing on his cover letter.”

40. Perusal of the copy of the Contract for Sale dated 23 December 2016 (the Contract) on which Mr Puara relies as the source document for his purchase of the 2.03 hectares of customary land later known as Portion 3959c, which copy Contract for Sale is annexure “01” to Mr Puara’s earlier affidavit of 16 December 2019, describes the parties to the Contract as:

“(A) NOU NOU

Through the Vendor its and legal representative Mr Nou Nou, an adult male citizen and in his capacity as Dispute Committee Chairman and a Senior clan member, for himself and on behalf of ALL the members of the Kaevaga ILG of Baruni Kaevaga Village (THE VENDOR) ..

AND

(B) PNG TRANS LOGISTICS LTD, is legal entity registered under the laws of Papua New Guinea, through tis DIRECTOR MR RICHARD PUARA (THE PURCHASER) ...”

41. The recitals to the Contract for Sale then state:

“WHERE AS

(1) The parties hereby enter into an Agreement for Sale and Purchase of a Portion of Customary Land known as BEGA DAHA more particularly described in Item 3 of the Schedule.

(2) In consideration of this Agreement, the Vendor Mr NOU NOU and the Purchaser MR RICHARD PUARA agree to be bound by the provisions of this Agreement.”

42. The land at that point in time was described in Item 2 of the schedule to the Contract as being “The Survey Portion of Land within the larger portion of Customary land known by native name as Bega Daha and measuring two (2) Hectares at K150,000 per Hectare, . The land is located near the new Motukea Wharf.”
43. The purchase price for the land as set out in Items 4, 5 and 6 of the schedule to the Contract was K300,000, with a first payment of K150,000 to be paid by Mr Puara upon execution of the Contract, the remaining K150,00 to be paid “upon approval and issue of the Title by the Department of Lands and Physical Planning or such other manner as ... both parties deem fit.”
44. Clause 1.5 of the Contract provided that:

“1.5 The Purchaser shall undertake at his own expense and be responsible for the survey of the subject land, lodgment, payment of prescribed fees and costs, and registration of the land under his own name including all other necessary physical and administrative compliance in furtherance of his interest and desire to purchase the land but reserves the right to deduct monies paid on behalf of the Vendors in procuring the title to the said land.”

[underlining added]

45. The execution page of the Contract states that it was signed by Mr Nou in the presence of witnesses Morea Nou, Dabada Arua, Willie Nou and Glen[n] Jerry; and that it was signed by Richard Puara as director of Trans Logistics Limited in the presence of Jacob D. Aburu and Sgt Richard Triga, CID Boroko Police Station. The execution page bears the signatures of all of those persons, as well as the signature and stamp of lawyer Jason Kolo.
46. Despite some initial ambiguity in the name of the purchaser in the Contract having been referred to as ‘PNG Trans Logistics Ltd ... through its director Mr Richard Puara”, it is obvious that Mr Nou signed the Contract as vendor on behalf of all members of the Kaevaga ILG with the intention that the subject customary land was being sold to Mr Puara in his own right. Clause 1.5 and other clauses in the Contract use the pronoun “his”, not “its”, when referring to the Purchaser. I therefore accept for the purposes of the leave application of Mr Nou and Kaevaga ILG that annexure “01” to Mr Puara’s affidavit filed on 16 December 2019 is good evidence that Mr Nou on behalf of the Kaevaga ILG executed the Contract for the sale of the subject land to Mr Puara personally as the director of PNG Trans Logistics Ltd rather than to Mr Puara’s company.
47. I am supported in this view by the Consent Agreement which was signed by Mr Nou on behalf of the Kaevaga ILG on 13 November 2017, a copy of which is annexure “PR13” to Mr Puara’s affidavit filed on 17 December 2019 and referred to again at length in paragraphs 8 to 14 of Mr Puara’s affidavit filed on 9 October 2010. The Consent Agreement states”:

“We the clan members of Kaevaga Land Group Incorporated (REG. ILG NO. 307) of Baruni Village and being the traditional landowners hereby duly give our consent over the sale of Begadaha a customary pocket of land portion within Sasiva customary landmass owned by Kaevaga ILG.

We affirm acquisition of Begadaha herein referred to as Portion 3959c (NCD) Cat. No. 49/3729 Milinch of Granville Fourmil of Moresby by Mr Richard Puara of PNG Trans Logistics Limited and all other requirements been complied with to be legal transferred to Mr Richard Puara of PNG Trans Logistics Limited.

Hence, we affirm that the referred land portion was purchased for K300,000.00 on the 23^rd of December 2016 hence been surveyed however ending title registration under Mr Richard Puara of PNG Trans Logistics Limited upon granting of the application under section 7 of Land Tenure (Conversion) Act we do not object.

The undersigned signatories are true legitimate clan members giving effect to this consent agreement on this dated 13^th November 2017.

[signature]
NOU NOU

Senior clan member & Dispute Settlement Authority Chairman”

48. The Consent Agreement then sets out signatures and names of the following members of Kaevaga ILG:
    • Dabada Arua Kobua, Senior Clan Member & Treasurer
    • Morea Nou, Senior Clan Member & Dispute Settlement Authority Committee
    • Auda Borema, Senior Clan Member
    • Rahe Rahe, Senior Clan Member & Dispute Settlement Authority Committee
    • Nigani Toni, Senior Clan Member
    • Peter Toaka, Senior Clan Member
    • Veidiho Nou, Senior Clan Member
    • Rarua Nou, Senior Clan Member
    • Girigi Borema, Senior Clan Member
49. Mr Dabada Arua Kobua, one of the signatories to the Consent Agreement, has sworn an affidavit filed in this proceeding on 9 October 2020 in which he deposes that he is a crime scene investigator with the Forensic Division of the Royal PNG Constabulary, having served with the Police for 11 years. He confirms in his affidavit that he is from the Kaevaga Clan of Baruni Village and that he is the treasurer of the Kaevaga ILG. Mr Kobua deposes in paragraph 5 of his affidavit that his signature on the Consent Agreement is authentic.
50. I accordingly accept Mr Puara’s explanation as to how the Consent Agreement signed by Mr Nou and other senior members of the Kaevaga ILG and Kaevaga Clan on 13 November 2017 came into existence and that it is a genuine document, not forged by Mr Puara at all, as has been alleged by Mr Nou. It is therefore disingenuous for Mr Nou and Kaevaga ILG to seek to deny through paragraph 4.5 of their proposed amended defence and cross-claim that they have no knowledge of the Consent Agreement and that it is a document that has been forged by Mr Puara. Such a pleading, on the evidence presented to this Court at this hearing, is patently untrue.
51. As to the proposed pleading by Mr Nou and the Kaevaga ILG in numerous paragraphs of their draft amended defence and cross-claim that alleged breaches of the Land (Tenure Conversion) Act 1963 constitute fraud because, among other things, no opportunity was given to Mr Nou and members of the Kaevaga ILG to object to the conversion of the subject land into freehold title at the LTC hearing, counsel for Mr Puara has submitted, correctly in my view, that breaches of statute per se do not constitute fraud.
52. With reference to the proceedings before the LTC, Mr Gaudi Rei of the Tanomotu Clan of the Sasiva area of Baruni has sworn an affidavit in support of Mr Puara’s case. Mr Rei’s affidavit was filed on 9 October 2020. He deposes in paragraphs [9] and [10] of his affidavit as follows:

“9. Speaking of the LTC proceedings I recall that Mr Nou as present in the proceeding and gave evidence in support of the Plaintiff for grant of Conversion Order. Nou’s family and his brother Rei Nou, Morea Nou, Veidiho Nou and their Glen[n] Jerry and other Kaevaga Clan members were present during the LTC proceedings.

10. I further recall that in January 2018 the LTC Commissioner Mr Kutt Paonga brought a team of officers including a senior Police Officer when he came around to conduct physical inspection of the land boundary. I was present because I had informed that LTC that I had objections.

11. Mr Nou was present and he not only witnessed the LTC’s boundary inspection but he was the person who guided and walked the LTC Cartographer showing the land boundary. A substantial number of Kaevaga Clan members witnessed the activity.

12. Once the Plaintiff paid the Kaevaga Clan the deposit I saw [the Plaintiff] and his agents put up a perimeter mesh wire fence on steel posts.”

53. Counsel for Mr Puara has submitted that Mr Nou’s own evidence in his affidavit filed on7 February 2020, paragraphs 3 to 15, is conclusive that Mr Nou and members of the Kaevaga Clan were present during the LTC hearing, that they therefore had notice of the hearing and that any denial on their part that there were not given notice of the LTC hearing for the conversion of the title of the subject land is untrue.

Relevant Law – Applications to Amend

54. Mr Nou and Kaevaga ILG’s application for leave to file an amended defence and cross-claim out of time is made pursuant to Order 8 Rule 50(1) NCR.
55. Reproduced hereunder is the text of Order 8 Rule 50(1) and (2):

Division 4 – Amendment

50. General

(1) The Court may, at any stage of any proceedings, on application by any party or of its own motion, order, on terms that any document in the proceedings be amended, or that any party have leave to amend any document in the proceedings, in either case in such manner as the Court thinks fit.

(2) All necessary amendments shall be made for the purpose of determining the real questions raised by or otherwise depending on the proceedings, or of correcting any defect or error in any proceedings, or of avoiding multiplicity of proceedings.

[underlining added]

56. The Court’s power under Order 8 Rule 50 NCR is discretionary and broad. The onus is on the person applying for amendment to establish that the proposed amendments are necessary to enable the Court to determine the real questions in controversy between the parties, or to correct any defect or error in the proceedings and that the amendments will not prejudice the other party: see for example The Papua Club Inc. v Nusaum Holdings Ltd (2002) N2273, (Gavara-Nanu J); Eki Investments Ltd v Era Dorina Ltd (2006) N3176 (Kandakasi J, as he then was); Niap v PNG Harbours Ltd (2009) N3672 (Hartshorn J) and Kerowa v Hargy Oil Palms Ltd (2012) SC1194 (Injia CJ, David J, Makail J).
57. The principles attendant on an application under Order 8 Rule 50 NCR to amend a document, including pleadings, were conveniently summarized by Gavara-Nanu J in The Papua Club Inc v Nusaum Holdings Ltd (supra). After having reviewed relevant English and PNG authorities on point, His Honour succinctly summarized five policy considerations underlying the Court’s wide discretion given by Order 8 Rule 50. Paraphrasing those five considerations, they are as follows:
1. 1. Will the amendment enable the Court to determine the real issues in controversy between the parties?

2. Will the amendment correct any defect or error in the proceedings?

3. Will the amendment cause real prejudice or injustice to the other party?

4. Is the application for such amendment made bona fide or mala fide or, that is to say has the application been made in good faith or in bad faith?

5. Can the other party be fairly compensated with costs for the amendment?

58. To those considerations Cannings J in Kewa v Kombo (2004) N2688 has added:

6. Is the party prevented by its conduct or the manner in which the proceedings have progressed from being permitted to amend its pleadings?

7. Where do the interests of justice lie?

8. Is the proposed amendment efficacious? Is it a proper amendment?

Relevant Considerations

59. I apply the above considerations to the application of Mr Nou and Kaevaga ILG for leave to amend their defence and cross-claim out of time:

1. The amendments proposed by Mr Nou and Kaevaga ILG all go to alleged fraud whereas there is no credible evidence adduced before this Court of any legal or equitable fraud which has been committed by Mr Puara, the Land Titles Commission and/or Acting LTC Commissioner Mr Kutt C. Paonga in connection with the subsequent issuance of Mr Puara’s Certificate of Title Volume 37 Folio 248 in respect of Portion 3959c. Breach of statutory provisions per se does not constitute fraud. If there have been breaches of the Land (Tenure Conversion) Act 1963, those breaches have already been pleaded by Mr Nou and Kaevaga ILG in their existing defence and cross-claim filed on 9 March 2020.

The proposed amendments would not enable the Court to determine the real issues in controversy between the parties.

2. There is no defect or error in this proceeding which requires correction by the filing by Mr Nou and Kaevaga ILG of their proposed amended defence and cross-claim.

3. In view of the defective basis on which the proposed amended defence and cross-claim has been drafted, there can be no prejudice or injustice to Mr Puara if leave to file that document is refused.

4. The evidence before the Court suggests that the proposed amendment has not been made in good faith, particularly in terms of the denial by Mr Nou of the existence of the Consent Agreement, which was clearly signed by him and by senior members of the Kaevaga ILG and Kaevaga Clan. I have found that the Consent Agreement is a genuine document. It was not forged by Mr Puara.

5. The costs issue is not relevant, except that if Mr Nou and Kaevaga ILG’s application for leave is not granted, costs would normally follow the event.

6. The conduct of Mr Nou and Kaevaga ILG in denying the existence of the Consent Agreement and denying that they were given any opportunity to be heard at the LTC conversion of title hearing warrants the Court declining to grant leave to amend a pleading which would falsely plead those denials.

7. For the reasons already given, the interests of justice lie in the Court declining to grant leave for the proposed amended defence and cross-claim to be filed.

8. The proposed amendments to the defence and cross-claim of Mr Nou and Kaevaga ILG are not efficacious. The amendments are not proper and are not supported on the evidence adduced by Mr Nou and Kaevaga ILG.

60. In the result, I find that all of the considerations which the Court must address when determining the application for leave to amend the defence and cross-claim of Mr Nou and Kaevaga ILG have established that the application must be refused. Costs will, as foreshadowed, follow the event.
61. The case will now be adjourned to enable the parties to settle and file a statement of agreed and disputed facts and issues, following which directions will be given to expedite the substantive issues to trial.

ORDER

62. The formal terms of the Order of the Court are as follows:
    1. Pursuant to Order 14 Rule 10(1) of the National Court Rules, interim injunctions are hereby granted pending the determination of this proceeding or until further order of the Court:
       1. restraining the First, Second, Third and Fourth Defendants from taking any further steps whatsoever to alter or cancel Survey Plan Catalogue No. 49/3739 registered by the Office of the Surveyor General;
       2. restraining the Surveyor General from taking steps or further steps to alter or cancel the said Survey Plan Catalogue No. 49 /3739.
    2. The First, Second, Third and Fourth Defendants are jointly and severally liable to pay the Plaintiff’s costs of and incidental to the Plaintiff’s motion seeking interim injunctions filed on 24 September 2020, such costs to be taxed if not agreed.
    3. The motion of the Third and Fourth Defendants filed on 25 September 2020 seeking leave to file and serve an Amended Defence and Cross-Claim is refused.
    4. The Third and Fourth Defendants shall pay the Plaintiff’s costs of and incidental to contesting the Third and Fourth Defendants’ motion filed on 25 September 2020, such costs to be taxed if not agreed.
    5. The parties are to settle a Statement of Disputed and Agreed Facts and Issues for Trial for the Plaintiff to file and serve by Friday 22 October 2021.
    6. This proceeding is adjourned to Monday 8 November 2021 at 1.30 pm for Directions to expedite the parties’ respective claims to substantive trial.
    7. The time for entry of this Order is abridged to the time of signing by the Court which shall take place forthwith.

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Nemo Yalo Lawyers: Lawyers for the Plaintiff/First Cross-Defendant
Niuage Lawyers: Lawyers for the First Defendant and Second Defendant
Parker Legal: Lawyers for the Third and Fourth Defendants/Cross-Claimants