Hamaka v Kombri [2022] PGNC 370; N9916 (21 September 2022)

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AND:
TAUVASA TANUVASA in his capacity
as Solicitor General of PNG
Second Defendant

AND:
HON. LUKE PANGUMA, President, Hulia Rural
Local-Level Government
Fourth Defendant

AND:
HON. KEVIN ISIFU in his capacity as
Minister for Inter-Government Relations
Fifth Defendant

AND:
GIBSON TIGI, PAUL YAWE AND DANNY TADABE
as signatories to the account of Moran Local-Level Government
Special Purposes Authority
Sixth Defendant

DECLARATION – Declaratory Orders sought to set-aside consent order made in separate proceeding – jurisdiction of the National Court – s 155(4) of the Constitution – aggrieved persons claiming direct interest and the direct effect of the consent orders upon them – grounds of set-aside – alleged fraud and misrepresentation, alleged breach of s 59 of the Constitution – alleged irregularities – alleged careless and negligence - relief to be granted – considerations

Anthoney Hamaka & Ors v Martin Kombri & Ors (2021) N8959
David Kambomyap Allolim v Biul Kirokum (2018) SC1735
Pius Nui v. Senior Sergeant Mas Tanda (2004) N2765
Re Peter Naroi [1983] PNGLR 176
Paul Torato v Sir Tei Abal [1987] PNGLR 403
Simon Mali v The State (2002) SC690.
Joseph Kupo v Stephen Raphael (2004) SC751
Joseph Peng v. Phillip Craig Tangney (2009) SC969
Luke Tai v. Australian and New Zealand Banking Group (PNG) Ltd (2000) N1979
Motor Vehicles Insurance Ltd v. Sossie Joe (2007) SC863
Jackson Walaun v. Royal Wilson (2016) N6272

P. Harry, for the First and Third Plaintiffs
J. Haiara, for Second and Fourth Plaintiffs
M. Kombri, in person as the First Defendant
N. Yalo, for the Sixth Defendant
J. Kolo, for the Paul Yawe, a Sixth Defendant

1. ANIS J: The plaintiffs are committee members or former committee members of a state entity or authority which is known as Moran Local-Level Government Special Purpose Authority (Moran SPA).

2. They file this proceeding where they seek to set-aside a consent order dated 25 April 2019 (Consent Order). The Consent Order was granted by the National Court in proceeding described as OS 948 of 2018 – Hon Luke Panguma, President of Hulia Rural Local-Level Government (fourth defendant herein), Hulia Rural Local-Level Government (not a party herein) v. Hon Kevin Isifu, MP, Minister for Inter-government Relations (fifth defendant herein), Department of Inter-government Relations (not a party herein) and the State (OS 948 of 2018). The Consent Order was signed by the first defendant Mr. Kombri (Mr. Kombri) as the lawyer for and on behalf of the plaintiffs therein. Countersigning on behalf of the defendants therein was Mr Tanuvasa (the Solicitor General). OS 948 of 2018 was recalled before Dingake J on 25 April 2019 where the Consent Orders were endorsed.

3. The plaintiffs herein were not named as parties or as defendants in OS 948 of 2018. They say they discovered the existence of the Consent Order and OS 948 of 2018 after the said proceeding had concluded. They claim that they had direct interest and were relevant parties in OS 948 of 2018 but had not been named therein and had been ‘kept in the dark’, so to speak, before and after the grant of the Consent Order. They say they ought to have been added as defendants in OS 948 of 2018. Their attempt to join in as parties in OS 948 of 2018 after the signing of the Consent Orders was declined by Dingake J on 6 June 2019. His Honour refused the application for the main reason that OS 948 of 2918 had concluded.

4. The plaintiffs then commenced this proceeding on 5 August 2019. The trial concluded 20 September 2021. There was no cross-examination of witnesses. Evidence were tendered through counsel. Presentation of submissions were heard on 15 October 2021 before I reserved my decision.

6. In brief and as stated, the plaintiffs claim that although they had direct interest over disputes that had been captured in OS 948 of 2018, the defendants had deliberately excluded them as parties in the said proceeding. And in so doing, they claim, the Consent Order was signed and endorsed by the Court in their absence. They say as a result of that, they are directly affected, that is, in terms of their roles and positions they hold in the Moran SPA. Term 4 of the Consent Order effectively replaces them as committee members of the Moran SPA and in their stead, appoints or recognizes new committee members to the Moran SPA. These new committee members are or include the sixth defendants. As for the relief, they seek orders which include setting aside the Consent Order, reinstating OS 948 of 2018, and for the return of funds that had been withdrawn from the account of the Moran SPA during the tenure of the Consent Order.

7. The original dispute concerned the appointment of or the legitimacy of appointment of the management committee members for the Moran SPA including the positions of Chairman and Deputy Chairman (committee members). Members of the sixth defendants had claimed they were the duly appointed committee members of the Moran SPA, so they filed proceeding OS 368 of 2018, Gibson Tigi, Paul Yawe, Thomas Tawanda, Jackson Irali and David Dalira v. Anthony Hamaka (OS 368 of 2018), to seek orders, amongst others, to that effect. There were earlier or other proceedings filed, some of which are pending, but I will refrain from going there but rather focus on what is before this Court. On 16 August 2018, Kandakasi DCJ dismissed OS 368 of 2018, and in so doing, issued permanent restraining orders against the sixth defendants including Thomas Tawanda, Jackson Irali and David Dalira (who are not named in this proceeding), from holding themselves out as Chairman, Deputy Chairman, or committee members of the Moran SPA. About 4 months later on 14 December 2018, defendants filed OS 948 of 2018. But this time, they did not name any of the plaintiffs as defendants, and as stated above, they obtained the Consent Order on 25 April 2019. The Consent Order states in part:

NO	REPRESENTATIVES	NAMES
1	Homa, Paua and Paguale Yalanda Local Areas Paguale Yalanda Local Areas Homa Local Areas Paua Local Areas	Mr. David Dalira Mr. Thomas Tawanda Mr. Jack Irali
2	Aporo’Uri Resources Owners Association (AUROA) Kaipu/Sisipia Local Areas	Mr Paul Yawe
3	Pai Parapia Resources Owners Association (PPROA) Northwest Moran PDL 6	Mr. Gibson Tigi
4	Homa, Paua People’s Association (HPPA) Central Moran PDL 5	Mr. Gibson Molo
5	Hulia Rural Local-Level Government (HRLLG) Youths Women & Churches	Mr. Danny Tadabe Mr. Tabe Hani
6	Department of Petroleum & Energy	Secretary or his/her delegate
7	Department of Finance	Secretary or his/her delegate
8	Department of National Planning & Monitoring	Secretary or his/her delegate
9	Project Developer of Oil & Gas (Oil Search Ltd)	Managing Director of his/her delegate
10	Komo Magarima District Development Authority	Chief Executive Officer

8. The plaintiffs were aggrieved by the Consent Order, and so after they had unsuccessfully applied to be joined as parties in OS 948 of 2018, they filed this proceeding.

9. Evidence were tendered at trial on 21 September 2021. As stated above, the parties decided by consent that the hearing should proceed by way affidavits without the benefit of cross-examination. Evidence were tendered and were labelled with exhibit numbers.

10. The first defendant has filed a notice of intention to defend and a defence, and he has tendered evidence in rebuttal to the claim that is made against him. The second, third, fourth, fifth and sixth defendants, however, did not tender any evidence. Further, the second, third, fourth and fifth defendants have also not filed any notice of intention to defend nor a defence. As for the sixth defendants, defendant Paul Yawe was the only person that filed a notice of intention to defend. However, he did not file a defence after that. As for the remaining sixth defendants, Gibson Tigi and Danny Tadabe, they both did not file a notice of intention to defend nor a defence.

11. In my view, and given the glaring defaults by the second, third, fourth, fifth and sixth defendants, judgment may be automatically entered against these defendants if I am satisfied on the balance of probabilities that the plaintiffs have proven their case against them.

12. A preliminary issue which requires clarity is whether the National Court has jurisdiction to and can set-aside a consent order that is made by another concluded National Court proceeding. I note that have answered this query in the affirmative in Anthoney Hamaka & Ors v Martin Kombri & Ors (2021) N8959. At [34] and [35], I said:

34. That said, I note that I had asked counsel for the plaintiffs whether such a consent order of a National Court may be challenged or set-aside by filing a separate proceeding in the National Court. Counsel assisted in that regard, and if I may, Justice Cannings in Pius Nui v. Senior Sergeant Mas Tanda (2004) N2765 stated:

Though it was a consent order, it could have been appealed against if exceptional circumstances were shown. But the defendants have sat on the matter for well over a year. If they were serious about setting aside the order, they should have filed fresh proceedings and relied on the grounds of fraud or mistake. (Re Peter Naroi [1983] PNGLR 176, National Court, Andrew J; Paul Torato v Sir Tei Abal [1987] PNGLR 403, National Court, Bredmeyer J; Simon Mali v The State (2002) SC690, Supreme Court, Hinchliffe J, Sakora J, Batari J.) The defendants did not appeal against the order and did not file fresh proceedings to quash it. Their application to set it aside should therefore be viewed with extreme caution and refused.

35. The present proceeding alleges, amongst others, fraud or fraudulent conduct by the first defendant in regarding to obtaining the consent order in proceeding OS 948 of 2018.

As such, I do not find it as abuse of the court process or that it discloses no reasonable cause of action.

13. Relevant case authorities referred to were Pius Nui v. Senior Sergeant Mas Tanda (2004) N2765, Re Peter Naroi [1983] PNGLR 176, Paul Torato v Sir Tei Abal [1987] PNGLR 403 and Simon Mali v The State (2002) SC690. The Supreme Court in Simon Mali v The State (supra) stated:

We agree with the learned judge below that he had jurisdiction to hear and determine on the State's application to set aside. And this jurisdiction is inherent by virtue of the National Court being a court of law as envisaged by or under s 155(4) Constitution which is in the following terms:

Both the Supreme Court and the National Court have an inherent power to make, in such circumstances as seen to them proper orders in the nature of prerogative writs and such other orders as are necessary to do justice in the circumstances of a particular case.

14. A consent order may be compared or likened to an agreement. Parties to a proceeding would agree to the terms of their agreement which is then converted or endorsed by the Court as a court order. Thus, setting it aside may require satisfying the Court similarly to or based on the grounds for invalidating an agreement. Bredmeyer J in Paul Torato v. Sir Tei Abal and Ors [supra] at [413], recited with approval, the following passage from the Supreme Court Practice (1979):

A consent order can be set aside in an action commenced for the purpose of any ground that would invalidate an agreement . . . If consent has been given by mistake, it may be withdrawn at any time before the judgment is passed and entered . . . But where a final judgment has been passed and entered the Court cannot set it aside unless a fresh action is brought for that purpose although it has been entered by mistake (Ainsworth v. Wilding [1896] UKLawRpCh 42; [1896] 1 Ch 673 and Wilding v. Sanderson [1897] UKLawRpCh 120; [1897] 2 Ch 534).

15. Kariko J in Talibe Hegele v. Tony Kila and Ors (2019) N8119, stated, which I adopt, at [21] and [22]:

20. The approach in England to setting aside a consent order is stated in Halsbury’s Laws of England4th Edition, Vol 3 [522]:

“[A] consent order or compromise may be set aside on a ground which would invalidate any other agreement between the parties including mistake, illegality, duress or misrepresentation”.

“A judgment given or an order made by consent may be set aside in a fresh action brought for the purpose on any ground which would invalidate a compromise not contained in a judgment or order. Compromises have been set aside on the ground that the agreement was illegal as against public policy, or was obtained by fraud or misrepresentation, or non-disclosure of a material fact where there was an obligation to disclose, or by duress, or was concluded under a mutual mistake of fact, ignorance of a material fact, or without authority” (My underlining)

21. That position is endorsed by Kandakasi J in Harry Tovon v Carl Malpo (2016) N6240 in his discussion of relevant case authorities including the Simon Mali case. At paragraph [36(a)],his Honour affirmed that a party affected by a consent order may apply to have the order set aside if it resulted from misrepresentation or fraud, as is the case with any other agreement.

16. The circumstances where a consent order may be set-aside include, (i), non-disclosure of relevant facts, (ii), fraud or misrepresentation, (iii), supervising events and significant change of circumstance, and (iv), undue influence. I would also add these 2 additional circumstances, (v) breach of right to be heard of a non-party who would otherwise have been an essential party or whose interest was or is directly affected by a term or terms of the consent order, and, (vi),where a party or a non-party having a direct interest in or who is directly affected by the consent order, establishes one or more irregularities in regard to the grant of the consent order by the court. I must also caution myself when being asked to exercise my jurisdiction in this regard, that is, that I must not readily grant an application or proceeding such as this that seeks to set aside a consent order. See cases: Paul Torato v Sir Tei Abel (supra) and Joseph Kupo v Stephen Raphael (2004) SC751. A final consent order connotes an agreement between parties which puts an end to a proceeding or a dispute, something which any Court should be cautious of and protect or uphold.

17. The plaintiffs submit that the Consent Order should be set-aside based on fraud and misrepresentation of the facts and law, that is, based on the actions or conducts of the first defendant as the former lawyer of the fourth defendant, and as the former lawyer for the second faction, at the material times. The same argument is raised against the other defendants. For clarity, I will proceed on the premise of alleged misrepresentation and or fraudulent misrepresentation.

18. So, in general, a claim for contract fraud or consent order fraud, may occur where a party makes a false proposition or statement to the other party or parties, or to the Court as is also alleged in this case, to get them to agree to the terms of the agreement or the consent order. In regard to fraudulent misrepresentation generally and under the common law, the considerations include, (i), a made representation, (ii), the representation was false, (iii), the defendant knew of its falsehood or it was made recklessly without knowledge of its truth or otherwise, (iv), it was made with the intention to cause the plaintiff (or the Court) to rely on it, (v), the representation was relied upon by the plaintiff (or the Court), and (v), the plaintiff suffered as a result. I will also add this. In a situation where it concerns consent orders, the Court’s involvement must also be noted, that is, to determine whether it was also misrepresented or fraudulently misrepresented. See case: Talibe Hegele v. Tony Kila and Ors (supra).

19. I note as a preliminary matter that the first defendant appears to raise the issue of standing or sufficient interest against the plaintiffs. I note that I had dealt with this issue in Anthoney Hamaka & Ors v Martin Kombri & Ors (supra). The first defendant, in my view, is attempting to rehearse the issue. He has covered that substantially in his submissions. All I can say in response is that if he was dissatisfied with my findings, he should have appealed against it to the Supreme Court. This is not the correct forum for that. As such, I dismiss any argument that relates to standings of the plaintiffs herein.

20. The plaintiffs seek the following main relief in their Statement of Claim (SoC):

21. The main issues, in my view, are as follows, (i), whether the plaintiffs have established one or more of and whether I should set-aside the Consent Order in OS 948 of 2018 based on, the grounds breach of natural justice, irregularities, and or fraudulent misrepresentation by the defendants, and (ii), subject to the above, whether a further order should be made against the defendants for the return of funds that have been withdrawn from the Moran SPA.

22. It is not denied firstly that the plaintiffs, who may be described as part of a faction (first faction), and the fourth and sixth defendants who may be described as part of another faction (second faction), have been fighting tooth and nail, so to speak, in regard to the positions of Chairman, Deputy Chairman and Committee Members for the Moran SPA, since 2014. Various Court proceedings have been filed as highlighted in the pleadings which is uncontested. The proceedings include OS(JR) No 647 of 2015, OS No. 368 of 2018, OS No. 948 of 2018 and the present proceeding.

23. It is also not disputed that the first defendant had acted as counsel for the second faction in proceeding OS No. 368 of 2018. The first defendant had also acted for the fourth defendant and the Hulia Rural Local-Level Government (HLLG) in OS No. 948 of 2018. It is obvious to note that the fourth defendant was part of the second faction at the material time. There is no evidence filed by the fourth or sixth defendants to dispute the evidence of the plaintiffs on this issue. Mr Kombri’s evidence, I note, is limited to the allegations that are raised against him as a defendant in this proceeding. He cannot, in my view, speak for or give evidence on behalf of the other defendants to defend them in this proceeding.

24. So, based on the uncontested facts alone, should I then be satisfied that the plaintiffs were affected by the Consent Orders of 25 April 2019 in OS No. 948 of 2018? Should I also be satisfied that they had been denied their right to natural justice when they were not joined as parties to the proceeding?

26. The only relevant argument raised by the defendants that may relate to relief 1 and 2 was raised by the first defendant. However, the argument covers standing or interest which I have already addressed and dismissed above herein. The bulk of the first defendant’s arguments and evidence address fraudulent misrepresentation which I will deal with separately below. But the glaring facts are sufficient, in my view, to grant relief 1 & 2 in the SoC. Relief 2 is consequential to relief 1. If a person has a direct interest in a contested dispute or matter but has been kept out of it by not being named as a party to a Court proceeding, and then parties to the proceeding sign consents orders that directly affect the rights or interests of the person not named, that shall or would constitute a breach or infringement of 59 of the Constitution. The Supreme Court in David Kambomyap Allolim v Biul Kirokum (2018) SC1735, in addressing natural justice stated in part at [37], The minimum requirement for natural justice is to give the aggrieved person the opportunity to seek protection and enforcement of its rights and interests.

(1) Subject to this Constitution and to any statute, the principles of natural justice are the rules of the underlying law known by that name developed for control of judicial and administrative proceedings.

(2) The minimum requirement of natural justice is the duty to act fairly and, in principle, to be seen to act fairly.

28. Members of the second faction whom the fourth and sixth defendants were part of, were permanently restrained by Kandakasi DCJ in proceeding OS No. 368 of 2018 from holding themselves out as members of the Moran SPA when his Honour dismissed the proceeding on 16 August 2018. The first defendant acted for the second faction or the sixth defendants then. The actual order of 16 August 2018 reads,

29. At that time, the first faction led by the first plaintiff held positions as committee members for the Moran SPA or perhaps it would be fair to say that the committee positions for the Moran SPA were contested by the 2 factions. Less then 4 months after the Court Order of 16 August 2018, the fourth defendant engaged the first defendant Mr Kombri (who had been the lawyer for the second faction in OS 368 of 2018) and filed OS 948 of 2018. It is not disputed that none of the members of the first faction led by the first plaintiff were ever named, or served with, or were made aware of, OS 948 of 2018. The plaintiffs in OS 948 of 2018 is the fourth defendant herein and the HLLG (which is not a party herein).

30. On 25 April 2019, Dingake J in OS 948 of 2018 granted the Consent Order. Relevantly sought under term 4 of the Consent Order were orders that have appointed members of the second faction, namely, Gibson Tigi, Paul Yawe Thomas Tawada, Jackson Irali and David Dalira, as committee members of the Moran SPA. These were the very same people who had been permanently restrained by the National Court in OS 368 of 2018 on 16 August 2018 in occupying these positions or as members of the Moran SPA. The Court Order of 16 August 2019 remains binding to this day. It has not been set aside or successfully appealed against. The plaintiffs herein, as stated, were not served nor informed of the Consent Order until after 25 April 2019. I note that there is evidence of the transcript of proceeding at the time when the Consent Order was obtained, and I refer to Annexure AH36 of Exhibit P2. Nowhere in there did it record Mr Kombri bringing to the attention of the judge of the earlier proceedings including OS 368 of 2018 and the Court Order of 16 August 2018. The Court, based on what was briefly presented, proceeded to endorse the Consent Order.

31. I refer to Exhibit D1 (affidavit filed on 16 April 2021), Exhibit D2 (filed on 23 April 2021) and Exhibit D3 (filed on 14 September 2021) of the first defendant. In general, I observe that most of their contents contain submissions and not depositions of facts. Secondly, I observe that Mr Kombri cannot speak for the other defendants or the second faction whom he had acted for at the material time. He is named as a defendant herein accused of fraud or fraudulent misrepresentation in regard to what had transpired in OS 948 of 2018 and the Consent Order that was obtained therein. His evidence, in my view, excluding the submissions made therein, should be confined to the allegations that have been made against him. That is how I intend to approach Mr Kombri’s evidence in considering or addressing the matter.

32. In relation to the first ground concerning breach of s. 59 of the Constitution, I find that the plaintiffs have been denied their rights to be heard as parties in OS 948 of 2018 in general and in particular, in breach of their rights to participate or be heard in regard to the Consent Order. As such, they constitute, in my view, breaches of their rights under s. 59 of the Constitution. In so finding, I take into account the uncontested evidence on the subject matter as deposed to by the plaintiffs under Exhibit P1, Exhibit P2 and Exhibit P4. The plaintiffs or the first faction were not named as defendants in OS 948 of 2018. They were the primary parties to the dispute but they, it seems, were deliberately kept out of OS 948 of 2018 from the time it was filed to the date when the Consent Order was signed. It is misconceived, in my view, for the first defendant or for the defendants to argue that attempts by the plaintiffs to be joined to argue the matter was refused by Dingake J therefore the Consent Order was in order or that it remains unchallenged and that the plaintiffs are estopped or prevented from raising that now, or that they are in the wrong forum to pursue the matter. As revealed in the transcript of proceeding, the trial Judge in OS 948 of 2018 refused to grant the interlocutory application for joinder by the plaintiffs because the proceeding, as his Honour had found, was at an end as per the terms of the Consent Order. And the trial Judge also stated in his ruling that the plaintiffs were at liberty to take other recourse to air their grievances, whether it be to appeal, review, or otherwise take other measures. The case law is also settled, as highlighted above herein, that a party who is aggrieved by a consent order may file a separate proceeding to set it aside.

33. I find that the plaintiffs’ fundamental rights to be heard and defend themselves under s 59 of the Constitution, were breached, that is, when the defendants or the second faction with their then lawyer Mr Kombri and the Solicitor General who had acted for the State, signed the Consent Order in OS 948 of 2018. I find that the first defendant, the defendants and in particular, the second faction, have deliberately orchestrated OS 948 of 2018 to suit their purpose which was to keep out the plaintiffs herein or the first faction, in order to enable themselves to sign the Consent Order. In so doing, they have committed this fundamental breach. I will also say this. Even if there may have been no deliberate intentions (which I find to the contrary) by the defendants or the plaintiffs in OS 948 of 2018 to exclude the plaintiffs herein or the first faction, the mere fact that the plaintiffs had been kept out of the proceeding and had not participated in the Consent Order itself would still have amounted to breaches of their rights under s 59. The plaintiffs or the first faction, at all material times, remained as relevant parties to the dispute. The contested nature of the matter in the past in regard to the positions of Chairman, Deputy Chairman, and Committee Members of the Moran SPA is not disputed. Both factions have fought over these positions since 2014 or 2015 right up to this present time.

34. And this. Even or despite the Consent Order, there are other proceedings that are on foot between the 2 factions. These include the permanent injunction that was granted by Kandakasi DCJ against the second faction or the sixth defendants herein, in OS 368 of 2018. Has the Consent Order addressed that? Or how can the defendants or the second faction sign the Consent Order without regard to the injunctive order? With these queries in mind, let me move on now the next sub-heading.

35. Mr Kombri, as counsel for the second faction, had been involved in the matter and had the full knowledge of its history including what had transpired shortly before he commenced OS 948 of 2018, that is, in OS 368 of 2018 and of the decision of Kandakasi DCJ. He expressly acknowledges and states his deep knowledge of the matter, the dispute, and its history, in his evidence.

36. Despite Mr Kombri’s deep knowledge and familiarity of the matter, he did not, as verified in the transcript of proceeding on 25 April 2019, (i), inform Dingake J anything about the first faction or the plaintiffs, (ii), their involvement in the dispute, (iii), of the past proceedings in the matter, and (iv), of the reasons why the fourth defendant did not see it fit or necessary to join the first faction or the plaintiffs in OS 948 of 2018.

37. Mr Kombri, as an officer of the Court, in my view, failed in that regard. This was a situation where Mr Kombri did not have to or would have required instructions from the client. It was rather a situation where one would require that a lawyer, as an officer of the Court, would discharge his duty to the Court in the administration of justice on matters in question. Discharging one’s duty does not include concealing relevant information, but rather, it requires full disclosures such as relevant facts or background of the matter in question. Mr Kombri, as a lawyer, in my view, owed that duty to the Court, namely, to disclose fully all information that were relevant or necessary in regard to the matter, to equipped the Court to better or fully understand the case and of the existing disputes beforehand, before requesting it to endorse the Consent Order. That same duty and responsibility applied to the Solicitor General who signed off on behalf of all the defendants in OS 948 of 2018.

38. But it goes without saying, in my view, that Mr Kombri and the fourth defendant knew that had the Court been informed of OS 368 of 2018 and the injunctive orders that were in place at that time, the Court would not have endorsed the Consent Order. As such, Mr Kombri had to conceal these information from the Court. I find that to be the case herein. It is also obvious that OS 948 of 2018 was a repeat or a rehearse hearing which was similar to OS 368 of 2018. The main background facts, the issues, and the intended outcome, appeared the same, that is, the second faction had wanted in as duly appointed committee members for the Moran SPA (or orders that would regard themselves as the Authority’s duly appointed members) and not the plaintiffs or the first faction. These claims were essentially re-pleaded by the second faction (which was headed by the fourth defendant herein, in OS 948 of 2018) which were eventually granted by the Court via the Consent Order. However, I will leave the final or full arguments on this issue to be raised or fully argued in OS 948 of 2018, that is, if I am minded to grant the relief.

39. Had Mr Kombri acted diligently as a lawyer and as an officer of the Court, he would have informed the Court of the recent dismissed proceeding, namely, OS 368 of 2018, and of the Court Order that permanently restrained the second faction from holding themselves out as members of the Moran SPA. They were crucial or vital information which Mr Kombri had, with respect, concealed from the Court and possibly from the Solicitor General. The Consent Order included all the names of the very same persons whom the same Court (i.e., the National Court) in OS 368 of 2018, had injuncted, who were Mr Kombri’s former clients. Had these information been disclosed to the Court, it could have changed the outcome of the hearing in regard to the grant or otherwise of the Consent Order.

40. Therefore, apart from my finding that the plaintiffs had had their rights to be heard breached, the conducts and actions of the defendants also constituted serious irregularities and misrepresentation which were also fraudulent in nature. The Court in OS 948 of 2018 would not have endorsed the Consent Order had Mr Kombri brought its attention to the long outstanding dispute between the two factions, proceeding OS 368 of 2018, and of the final court order made therein by Kandakasi DCJ on 16 August 2018. Mr Kombri attempts to argue that the 2 separate orders, amongst others, do not contradict each other. However, in my view, these arguments and facts should have been disclosed or raised before Justice Dingake in OS 948 of 2018 before the signing of the Consent Order. He had failed in that regard as revealed in the transcript of proceeding, and now he is making them before this Court. In my view, and as I have intimated to Mr Kombri at the hearing, the arguments appear invalid before this Court but may be raised in OS 948 of 2018 if this Court is minded to sets aside the Consent Order and re-instates OS 948 of 2018. I maintain this view.

41. I also find a serious flaw in the Consent Order which, in my view, would render the Consent Order irregular. At the time of its entry, the court order of 16 August 2018 in OS 368 of 2018 also existed. It has not been set aside before and after the entry of the Consent Order. All the members of the second faction that have been captured under term 4 of the Consent Order as duly appointed members of the Moran SPA appeared to have been permanently banned from holding themselves out as members of Authority. The terms of the orders may be clarified at some point, but as I have stated, that is not for me to decide in this proceeding. Clarity may be sought in OS 368 of 2018 or otherwise other avenues that may be available to the parties. But as the order remains binding, clarity should have been sought first by the second faction through their lawyer Mr Kombri and the State Lawyers before the Court in OS 368 of 2018 or in OS 948 of 2018. They have not done that, and they have gone ahead and obtained the Consent Order whilst the Court Order of 368 of 2018 still remains as binding. In my view, that is a very serious irregularity, and the blame has to be laid squarely on Mr Kombri as the lawyer for the second faction (or the fourth defendant), but most importantly, as an officer of the Court given his personal or detailed knowledge in the matter. Mr Kombri had been acting for the second faction in OS 368 of 2018. He knew that his clients were permanently restrained by Kandakasi DCJ from holding themselves out as committee members of the Moran SPA. Yet, Mr Kombri, as an officer of the Court, who had first-hand knowledge of these facts and of the said order, deliberately kept these information from the Court in OS 948 of 2018.

42. Evidence of these may be seen in the transcript of the proceeding. Mr Kombri had informed the Court on 25 April 2019, that is, at line 10, page 3 of the transcript, as follows:

And that appointment (referring to the appointment of the second faction to the Moran SPA) has been sitting there for a long while and we are attempting to solve it administratively but we could not, hence we filed this – the first and second plaintiff filed this proceedings. After filing this proceedings and serving on the defendants we then negotiated and resolved to resolve this matter. [Explanatory note and bold lettering mine]

43. This presentation by Mr Kombri made to the trial Court, constitutes fraudulent or deliberate misrepresentation of the facts. Mr Kombri had fraudulently misled the Court.

44. There is a further point which I believe is necessary to point out to demonstrate the bizarre or outrageous conduct by Mr Kombri and the defendants in OS 948 of 2018. I refer to the Consent Order in particular its term 7. It is drafted in a manner as if to ‘do a switch’, so to speak, against the plaintiffs or the first faction, that is, to stop them from holding themselves out as well as committee members of the Moran SPA. Term 7 of the Consent Order reads:

45. In comparison, term 2 of the earlier Court Order of 16 August 2018 in OS 368 of 2018 which was made in favour of the plaintiffs reads:

46. In other words, the second faction is saying to the first faction (and I quote as my own analysis, as follows), “you may permanently restrain us in OS 368 of 2018 but we have done the same to you too.” I think this is a better illustration of what has occurred from the 2 proceedings. And will I go back to my introduction where I say that the dispute has been hotly contested between the 2 factions for about 7 years or so. It is most likely to continue on after this proceeding ends. Unfortunately, and in the process, it appears that Court processes are being abused by the parties in their quest to hold positions in the authority in question.

47. For this purpose, however, and to conclude, I find that the defendants have fraudulently misrepresented the Court towards endorsing the Consent Order in OS 948 of 2018.

48. The plaintiffs also argue that the defendants in OS 948 of 2018 did not file a notice of intention to defendant nor a notice of appearance. As such, they submit that the defendants had no right of audience before the Court; that they could not have validly subjected themselves in OS 948 of 2018 formally without leave. Thus, they submit that that constitutes a further irregularity that should warrant this Court to set-aside the Consent Order.

50. In answer, I refer to the case, Joseph Peng v. Phillip Craig Tangney (2009) SC969. At [14], the Supreme Court stated:

14. The fact is that the time period within which the notice of intention to defend had expired on 18th December. When this happens, O 7 r 6 (2) NCR regulates when the defence should be filed. Because of this rule, a defendant cannot file a defence and take other steps in the proceedings, as being allowed to do so is subject to the discretion of the court. In this case, the notice was filed late (on 28th January), and the purported defence was filed without the express leave of the court, contrary to O 7 r 6 (2) NCR. [Underlining and bold lettering is mine]

51. The Supreme Court therein recognized the requirements of Order 7 Rule 6(2) of the National Court Rules (NCR), which states:

Subject to these Rules, a person shall not, except by leave of the Court, take any step in any proceedings unless, before taking the step, he has filed originating process in the proceedings or has given a notice of intention to defend in the proceedings.

52. That said, it is also settled law that a defendant can file his or her notice of intention to defend out of time. See cases such as Luke Tai v. Australian and New Zealand Banking Group (PNG) Ltd (2000) N1979, Motor Vehicles Insurance Ltd v. Sossie Joe (2007) SC 863 and Jackson Walaun v. Royal Wilson (2016) N6272. But that type of scenario (i.e., where a notice of intention to defend is filed late) is different to the scenario in OS 948 of 2018. In OS 948 of 2018, no notice of intention to defend or notice of appearances were ever filed by the Solicitor General on behalf of the defendants before and after the signing of the Consent Order. As such, for the defendants to be heard or take any further steps, leave of the Court was required and ought to have been sought and granted by the Court. The transcript of the proceeding in OS 948 of 2018, however, shows that no leave had been expressly sought or granted by the Court to the defendants that would have permitted the Solicitor General to engage himself on behalf of the defendants in the manner as he had done.

53. In my view, this was a serious irregularity which should, in itself, warrant setting aside the Consent Order.

54. The State has not filed any evidence in reply. As such, and apart from the findings on irregularity, I also find that the plaintiffs have established their case of carelessness or fraudulent misrepresentation by the Solicitor General. There was no proper assessment made or due diligence carried out by him in regard to OS 948 of 2018. Basic searches would have revealed the involvement of the 2 factions and of the numerous cases that had or have been filed before the Courts. Regardless, the very act by the Solicitor General in counter-signing the Consent Order without first filing the relevant notice of intention to defend or notice of appearance, or without first seeking leave of the Court, in my view, makes the State and the defendants all liable.

55. In summary and based on the findings of this Court, I am minded to set-aside the Consent Order of 25 April 2019 that was made in OS 948 of 2018, and in so doing, I am also minded to reinstate OS 948 of 2018. I will also make consequential orders which will include an order that the plaintiffs be added as the Fourth Defendants therein.

56. I note that this was not a claim for damages for negligence or professional negligence. The main remedies sought for breach of s 59 of the Constitution, irregularities and or misrepresentation including fraudulent misrepresentation, were, (i), to set-aside the Consent Order, (ii), to reinstate OS 948 of 2018 and (iii), to return monies that had been withdrawn out of the Moran SPA account due to the said breach of rights to be heard, irregularities and fraudulent misrepresentation which had resulted in the wrongful recognition of the second faction or the sixth defendants as appointed committee members of the Moran SPA as at 25 April 2019.

57. In regard to Mr Kombri, my findings against him were in regard to his role as an officer of the Court. I have found that he had failed in that regard; that he deliberately misled the Court towards granting the Consent Order, thus, he was also liable under the grounds (i), breach of rights to be heard, (ii), the irregularities that had been committed, and (iii), for fraudulent misrepresentation. I find him liable together with his former clients, namely, the fourth and sixth defendants, and together with the State.

58. I now ask myself this. Should the defendants be ordered to refund or return the monies that belonged to the Moran SPA?

59. My answer to that is, “yes they should or must.” Any money that was withdrawn from the account of the Moran SPA as at or immediately after 25 April 2019 must be returned to the authority. In summary, it is obvious, based on the adduced evidence of the plaintiffs, that the second faction had, through the fourth defendant, commenced OS 948 of 2018 to appoint themselves as management committee members over what has been a hotly contested matter over the years. This was done despite their unsuccessful attempts in OS 368 of 2018, and despite a court injunction that, on the face of it, prevented them from holding themselves out as members of the Moran SPA.

60. They appear to have abused the Court process in their bid or battle over these positions. Their outrageous conducts, together with the conduct of their then lawyer Mr Kombri, may also be termed as contemptuous. Mr Kombri was the lawyer of the fourth defendant who is part of the second faction or the sixth defendants. He is however sued as a defendant herein given the role that he had played particularly in facilitating and in partaking in signing the Consent Order for the second faction whom the fourth defendant was part of. In my view, he cannot deny his interest and association with the second faction or the sixth defendants from the fourth defendant. The reason why I say this is simple. He had acted for the second faction or the sixth defendants in OS 368 of 2018. His clients had wanted to seek the relief that had been sought in OS 948 of 2018. However, his clients’ case in OS 368 of 2018 was dismissed by Kandakasi DCJ. Permanent Injunctive Orders were then issued by His Honour against Mr Kombri’s clients or the second faction from holding themselves out as committee members of the Moran SPA. These were captured in the Court Order of 16 August 2018. Mr Kombri, about 4 months later, and whilst knowing fully well of the existence of the Court Order of 16 August 2018 and of the permanent injunctive orders, received instructions from the fourth defendant and HLLG, and filed OS 948 of 2018. Under OS 948 of 2018, the second faction essentially sought similar-type relief which were premised on the same or identical background facts, that is, facts where Mr Kombri’s earlier clients’ (i.e., the second faction) had relied on in OS 368 of 2018 which had been dismissed by the Court. Not only that, Mr Kombri, upon instructions from the second faction or the fourth defendant and HLLG, prepared the Consent Order and in particular, included the names of all his former clients in OS 368 of 2018, into term 4 of the Consent Order. He knew, as opposed to ought to have known, at that time right up to the date of the trial of this matter, of the existence of the Court Order of 16 August 2018 which permanently restrains his former clients or the sixth defendants herein. Despite these, he included term 4 of the Consent Order and refused, (a), to inform the trial Judge of that, (b), of the historical background of the matter, and (c), of the long-standing feud between the 2 faction and of the plaintiffs’ interests which was the whole reason why the second faction had gone to the Court and had filed OS 948 of 2018 through the fourth defendant.

61. Evidence adduced also shows that Mr Kombri and the second faction were quick to write to the bank on the same date when the Consent Order was obtained, which was on 25 April 2019, where they had demanded immediate changes to be effected to the signatories to the account of the Moran SPA so that Mr Kombri’s former client’s the second faction or the sixth defendants would be listed as the new signatories to the account. Evidence of the letter by My Kombri to Bank South Pacific Ltd (the bank) is located at Annexure AH37 to Exhibit P2. This time, and in the letter, Mr Kombri held himself out, not as the lawyer for the fourth defendant, but as the lawyer for the Moran SPA. Funds close to or more than two million kina were claimed to have been withdrawn from the account of Moran SPA thereafter.

62. I will grant the relief which will require the defendants to return any monies that have been paid out of the Moran SPA account(s) including from its BSP Account No. 1001774296. As a further consequential order, I will order Bank South Pacific Ltd, to furnish to the Court, that is, by filing an affidavit to that effect within 28 days from the date of service of this order, all records of funds that had been paid out of the account(s) of the Moran SPA including from its Account No. 1001774296 to the defendants. The purpose for this is to ascertain and ensure that the monies, which have been paid under this irregularly entered Consent Order, which will now be set aside, are returned to the Moran SPA.

63. The plaintiffs have, to my satisfaction, established their claim on the balance of probabilities for me to grant the orders that they seek in the SoC. In so doing, I reject all the arguments that have been advanced by the defendants, most of which have been addressed herein. Others that have been covered, were frivolous or irrelevant to the material issues before the Court thus were disregarded but shall be treated as baseless and are dismissed.

65. Let me say this. This is a case where I have seen blatant disregard by the defendants to the rule of law and to Court practice and procedures. There is also evidence of deliberate actions by the first defendant in particular, that is, to conceal relevant facts before the Court in OS 948 of 2018. These included failure by the first defendant to fully disclose the background information of the dispute between the 2 factions, failure to disclose the names of the plaintiffs or the first faction to the Court, and failure to disclose proceeding OS 368 of 2018 and the final court order that was made by Kandakasi DCJ on16 August 2018.

66. The Solicitor General on behalf of the third, fourth and fifth defendants, cannot, in my view, evade cost and the type of cost-scale the Court may award. In my view, the Solicitor General should have exercised his duty competently as the legal representative for the State and its entities. He has failed in that regard, that is, to conduct due diligence on the matter before he executed the Consent Order in OS 948 of 2018. I have no evidence from the Solicitor General here to assist me. Thus, the evidence of the plaintiffs shall therefore also be considered in their favour and against him in the capacity that he holds.

67. Taking all that into account, I order that cost of the proceeding shall be entered in favour of the plaintiffs against the defendants jointly and severally, on an indemnity basis which may be taxed if not agreed.

68. In conclusion, I wish to make this remark. Lawyers who are admitted to practice law in this jurisdiction, apart from their duties to their clients, have a paramount duty to the Courts that are established under the Constitution. It is through their guidance and commitments to the rule of law that Courts in turn may be better informed, assisted, or equipped with the necessary guidance that are required of particular matters that are before them, to fully perform their functions or exercise their role which is to deliver justice.

69. May I therefore remind all counsel herein to adhere to their roles as officers of the Court, that is, whether it be the National or the Supreme Courts of Papua New Guinea.

________________________________________________________________
Harry Lawyers: Lawyers for the First and Third Plaintiffs
Haiara Legal Practice: Lawyers for the Second and Fourth Plaintiffs
Kombri & Associates Lawyers: Lawyers for the First Defendant,
Nemo Yalo Lawyers: Lawyers for the Sixth Defendants
Kolo Lawyers: Lawyers for Paul Yawe, one of the Sixth Defendants

National Court of Papua New Guinea

Hamaka v Kombri [2022] PGNC 370; N9916 (21 September 2022)