Kevin v Kaor [2022] PGNC 302; N9783 (28 July 2022)

N9783

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

HRA NO 360 OF 2019

AUGUSTINE KEVIN
Plaintiff

V

MELINDA MAYBELYN KAOR
First Defendant

NATIONAL HOUSING CORPORATION
Second Defendant

Waigani: Cannings J
2022: 21^st April, 18^th, 28^th July

LAND – government land within urban area – whether fraud involved in granting or transfer of State Lease.

HUMAN RIGHTS – rights to full protection of the law, freedom from harsh, oppressive actions etc, protection from unjust deprivation of property – Constitution, ss 37(1), 41(1), 53.

The plaintiff commenced proceedings against her daughter (first defendant) and the National Housing Corporation (second defendant) regarding a residential property that she claimed should have been registered in her name. The plaintiff claimed that the first defendant had by misrepresentation and fraud been responsible for the transfer of the property, first, from the second defendant to the plaintiff, and then from the plaintiff to the first defendant and then from the first defendant to a third party. The plaintiff sought remedies in two categories. First, declarations as to fraud and orders that would result in title over the property being issued to her. Secondly, declarations as to breaches by the defendants of the plaintiff’s rights to the full protection of the law, freedom from harsh, oppressive actions etc, protection from unjust deprivation of property under ss 37(1), 41(1) and 53 of the Constitution, and damages.

Held:

(1) The starting point for resolution of any dispute over title to any government land, including the subject land, is the principle of indefeasibility of title: once a lease of land from the State is registered, an indefeasible title is conferred on the registered proprietor, subject only to the exceptions in s 33(1) (protection of registered proprietor) of the Land Registration Act, including s 33(1)(a), which states: “The registered proprietor of an estate or interest holds it absolutely free from all encumbrances except ... in the case of fraud”.

(2) Here, the plaintiff was alleging actual fraud against the defendants, but failed to prove it. The first category of relief was refused for that reason alone. There were also other reasons the first category of relief could not be granted: (a) if fraud had been proven, it did not involve the registered proprietor; (b) the claim was time-barred under s 16 of the Frauds and Limitations Act; and (c) the primary relief sought (cancellation of title and issuance of title to the plaintiff) would affect persons who were not parties to the proceedings.

(3) The plaintiff failed to prove that she had been denied the full protection of the law or that she had been treated harshly or oppressively or that she had been unjustly deprived of her interest in property. Her human rights claims, including the claim for damages, were refused.

(4) The proceedings were entirely dismissed.

Cases Cited

The following cases are cited in the judgment:

Berr v Yango (2015) N5859
Muku v Yama (2019) N7948
Wauwe v National Housing Corporation (2022) N9382

Counsel

J Kambao, for the plaintiff
M M Kaor, the First Defendant, in Person

28^th July, 2022

1. CANNINGS J: The plaintiff, Augustine Kevin, has commenced proceedings against her daughter, Melinda Maybelyn Kaor (the first defendant) and the National Housing Corporation (the second defendant) regarding a residential property at Gerehu in the National Capital District, formally described as Section 251 Lot 6.

2. The plaintiff’s family including the first defendant lived in the property from the mid-1970s until about 2015 when the first defendant obtained a District Court eviction order against the plaintiff.

3. What has happened with this property over that period of 40 years? Putting aside for a moment the allegations of fraud that are at the centre of this case, what has happened in simple terms is this:

• the property was in effect owned by the National Housing Corporation and it was rented to the plaintiff’s brother, Henry Setiro, under a standard form of tenancy agreement;
  
• in 2002 Mr Setiro was given the opportunity to purchase the property under a National Housing Corporation home ownership scheme but for some reason he did not take up that opportunity;
  
• instead, on 27 June 2005, the National Housing Corporation transferred the property to the plaintiff;
  
• on 30 December 2005 the plaintiff transferred the property to the first defendant (and the property was mortgaged to Bank South Pacific);
  
• on 19 March 2019 the plaintiff transferred the property to two persons who are not parties to these proceedings, and it appears – though it is not entirely clear – that they are still the registered proprietors of the State Lease over the property.
  

PLAINTIFF’S CASE

4. The plaintiff’s case is that at every stage in the above chain of transactions the first defendant has been guilty of misrepresentation and fraud calculated to defeat her interest in the property and to ensure that the first defendant would get the property for herself; and this has all been contrary to the wishes of Mr Setiro, who is now deceased, whose plan was that the property would remain in the family under the ownership and control of his sister, the plaintiff.

5. The plaintiff seeks remedies in two main categories, as pleaded in paragraph 24 of the statement of claim, which states:

(a) A declaration that the sale and transfer of the property from the second defendant to the plaintiff was fraudulent, unlawful, illegal, and therefore null and void and of no effect.

(b) A declaration that the sale and transfer of the property from the Plaintiff to the first defendant was fraudulent, unlawful, illegal and therefore null and void and of no effect.

(c) An order in the nature of mandamus that the first defendant or current title holder of the property, surrenders the owner’s copy of the title of the property to the second defendant within fourteen (14) days.

(d) Upon surrender of the title, an order in that nature of mandamus that the second defendant submits that title to the Registrar of Titles within a further fourteen (14) days with its recommendations for cancellation of the registration of title under the first defendant’s name or current title-holder’s name.

(e) Upon surrender of the title by the second defendant, an order in the nature of mandamus that the Registrar of Titles within a further fourteen (14) days cancel the title of the property under the first defendant’s name or current title holder’s name.

(f) Upon cancellation of the title, the second defendant shall issue a new title to the plaintiff over the property.

(g) A declaration that the defendants have breached the plaintiff’s rights under Sections 37(1), 41(1) and 53 of the Constitution.

(h) General damages under Section 57 and 58 of the Constitution for breaches of Sections 37, 41 and 53 of the Constitution.

(i) General damages for stress, anxiety, suffering and hardship caused through negligence.

(j) Interests on damages under the Judicial Proceedings (Interest on Debts and Damages) Act Chapter 52.

(k) Costs.

(l) And any other orders the Court deems fit.

6. The first category of relief is in subparagraphs (a) to (f). The plaintiff seeks declarations as to fraud and orders that would result in title in the property being issued to her.

7. The second category of relief is in paragraphs (g) to (i). The plaintiff seeks declarations as to breaches by the defendants of her rights to the full protection of the law, freedom from harsh, oppressive actions etc and protection from unjust deprivation of property under ss 37(1), 41(1) and 53 of the Constitution.

DEFENDANT’S RESPONSE

8. The defendant denies all allegations of fraud and misrepresentation and requests that the Court award damages to her against the plaintiff, for defamation of character. I can deal with that request now. I refuse to make any such orders. For a defendant to seek such relief against a plaintiff, a cross-claim must be filed. Here there is no cross-claim so no serious consideration can be given to that request.

ISSUES

9. The following issues arise:

1. Has the plaintiff proven fraud against either or both defendants?
   
2. Should the plaintiff be granted any of the first category of relief that she seeks?
   
3. Should the plaintiff be granted any of the second category of relief that she seeks?
   
4. What declarations or orders should the Court make?
   
1. HAS THE PLAINTIFF PROVEN FRAUD AGAINST EITHER OR BOTH DEFENDANTS?
   

10. This is the critical issue. To have any hope of getting the Court to disturb the title of the current registered proprietors, the plaintiff needs to establish that fraud was involved. This is because in Papua New Guinea we have a Torrens Title system of land registration for government land. Once a lease of land from the State is registered, indefeasible title is conferred on the registered proprietor. This is subject only to the exceptions in s 33(1) (protection of registered proprietor) of the Land Registration Act, including s 33(1)(a), which states: “The registered proprietor of an estate or interest holds it absolutely free from all encumbrances except ... in the case of fraud”.

11. The plaintiff’s case is built on actual fraud. She claims that the first defendant has defrauded her out of a property that is rightfully hers. It is the plaintiff’s case and she must prove it on the balance of probabilities. She has deposed in an extensive affidavit (exhibit P1) that the initial transfer of the property from the National Housing Corporation to herself, registered on 27 June 2005, and the transfer from herself to the first defendant, registered on 30 December 2005, took place without her knowledge or consent.

13. That evidence is countered by the affidavit of the first defendant (exhibit D1) who deposes that the above two transactions were effected with the knowledge and consent of the plaintiff and with the support of Mr Setiro and the National Housing Corporation.

14. With neither party presenting any other evidence in support of their version of events and neither giving oral testimony, the plaintiff has faced a difficult task in persuading me that her evidence should be believed, rather than the first defendant’s evidence. The plaintiff has not persuaded me.

15. In fact, because of the level of detail and the extent of documentary evidence annexed to the first defendant’s affidavit, I find as a fact that the first defendant’s version of events is to be preferred. I find that the first defendant did not commit the frauds and misrepresentation alleged against her.

16. As for the fraud alleged against the National Housing Corporation, I am not persuaded that any fraud occurred. I find that the National Housing Corporation was only doing what was requested by the plaintiff and the first defendant and by Mr Setiro.

17. The plaintiff has failed to prove fraud against either defendant.

2. SHOULD THE PLAINTIFF BE GRANTED ANY OF THE FIRST CATEGORY OF RELIEF THAT SHE SEEKS?
   

18. No fraud has been proven against either defendant. The first category of relief must be refused for that reason alone.

19. There are other reasons the Court will not make any of the declarations and orders sought, which would have seen title in the property issued to the plaintiff:

(a) if fraud had been proven, it did not involve the registered proprietor, and there must be proof of fraud by a registered proprietor before the Court would consider disturbing their title (Berr v Yango (2015) N5859, Muku v Yama (2019) N7948, Wauwe v National Housing Corporation (2022) N9382;

(b) the claim is time-barred under s 16 of the Frauds and Limitations Act as most of the alleged fraud was committed in 2005 and the proceedings ought to have been commenced in 2011, but were not commenced until 2019; and

(c) the primary relief sought (cancellation of title and issuance of title to the plaintiff) would affect persons who are not parties to the proceedings and it would constitute a denial of those persons’ right to the full protection of the law, and their right to natural justice, to make orders directly affecting their interests without giving them the opportunity to be heard.

3. SHOULD THE PLAINTIFF BE GRANTED ANY OF THE SECOND CATEGORY OF RELIEF THAT SHE SEEKS?
   

20. When I said earlier that the plaintiff’s case is built on fraud, that comment applies equally to the second category of relief she seeks. To have been granted any declarations as to breach of her human rights she had to prove fraud. She has not done that, so she has failed to prove that she was denied the right to the full protection of the law or that she has suffered from any harsh or oppressive actions against her or that she has been unjustly deprived of her interests in the property. None of the declarations as to human rights breaches will be granted, and the plaintiff will not be awarded damages.

4. WHAT DECLARATIONS OR ORDERS SHOULD THE COURT MAKE?
   

21. These proceedings must be dismissed. Costs would normally follow the event but in this unusual case, I don’t think it would help the parties to resolve their internal family issues for the Court to order the plaintiff to pay her daughter’s legal costs. In any event the first defendant has represented herself, so any costs ordered would be nominal.

ORDER

(1) The proceedings are dismissed and all relief sought by the plaintiff is refused.

(2) The parties will bear their own costs of the proceedings.

__________________________________________________________________
Public Solicitor: Lawyer for the Plaintiff