Ondalane v Kulara [2022] PGNC 471; N9988 (10 May 2022)

N9988

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS NO. 127 OF 2021

BETWEEN
JOHN ONDALANE
First Plaintiff

AND
FREDERICK IPARA
Second Plaintiff

AND
THOMPSON KULARA
First Defendant

AND
ANAKO AIYALA & DAVID MAPULI
Second Defendant

AND
GRAYSON TAU APAKALI
Third Defendant

AND
SAILAS AIYALA
President, Paiela Hewa Rural Local Level Government
Fourth Defendant

AND
LEO BILIP KUALA
President, Porgera Rural local Level Government
Fifth Defendant

Waigani: Linge AJ
2022: 4^th April, 10^th May

LOCAL LEVEL GOVERNMENT – Special Purpose Authority – appointment of members of the Special Purpose Authority – landowners’ representation – Local Level Government representative – ex official members

Cases Cited:

Philip Takori v Simon Yagari (2008) SC905

Counsel:

Mr J.Haiara, for the First Plaintiff
Mr H. Harry, for the Second Plaintiff
Ms J. Nandape, for the First and Third Defendants

10^th May, 2022

1. LINGE A J: This is a ruling on the hearing of the originating summons converted to the Statement of Claim (SOC) on the 30 July 2021. The plaintiff seeks to invalidate appointments of first and second defendants as nominees of the Porgera Landowners Association Inc. (hereinafter “the PLOA”) and certain decisions of the Porgera Development Authority (hereinafter “the PDA”) Management Board and to implement previous Court decisions relating to appointments and otherwise. I heard the cause of action on the 4 April 2022. The first plaintiff, second plaintiff, first defendant and third defendant are the only parties represented and made submissions.
   

Background

2. Under the Porgera Gold Mine regime, three (3) Memorandum of Agreements were signed in 1989. Of particular concern to this proceeding is the one signed on the 19 August 1989 between Porgera Rural Local Level Government, Paiela Hewa Rural Local Level Government, PLOA and the PDA.

3. The Porgera Local Level Government Special Purpose Authority (PLLGSPA) also known and used intermittently as the PDA is established pursuant to Part VII, Section 42 (1) of the Local Level Government Administration Act 1997, (hereinafter “the Administration Act”).

4. The PDA is governed by its Constitution which regulates appointments, composition, and operation of the PDA. Further, the PDA must comply with the provisions of the Administration Act, its Constitution, and the Proclamation.

5. Section 4.2 of the PDA Constitution established a Management Committee for PDA which is also provided for in Clause 1 of the Proclamation to comprise of:

(a) Two (2) persons appointed by the Porgera Rural Local Level Government;

(b) Two (2) persons appointed by the Paiela Hewa Rural Local Level Government;

(c) Four (4) persons appointed by the PLOA;

(d) Two (2) persons with special skills appointed by the PLOA to assist the Management Committee;

(e) Porgera District Administration;

(f) One person appointed by the Developer: and

(g) One person appointed by the Department of Finance.

Statement of Claim filed 30 July 2021

Facts

6. The first plaintiff is the Chairman and the second plaintiff the Deputy Chairman of PLLGSPA or PDA. The first plaintiff was appointed on a three (3) year term commencing on the 8 February 2019 by the Minister for Inter-Government Relations as one of the nominees of the PLOA.

7. The proceeding was converted to Statement of Claim and such was filed on 30 July 2021, seeking orders and declarations: -

(1) To declare the validity of the decision of PLLGSPA Management Board made on 11 February 2021 in Porgera pursuance to Court Order of 5 February 2021 as valid, effective, and enforceable.

(2) To challenge the validity of the nomination of the first defendant and second defendant as nominees of Paiela Hewa Rural Local level Government and Porgera Local level Government to PLLGSPA Management Board on the basis they were not qualified.

(3) To declare the appointment of first, second and third defendants as members of PLLGSPA as being null and void for reasons that:

(a) First and second defendants do not qualify as they failed to meet the educational and work experience criteria prescribed in PLLGSPA Constitution.

(b) Third defendant’s purported appointment as Acting General Manager was terminated by PLLGSPA on 11 February 2021 in its meeting held on that date.

(4) To declare the purported PLLGSPA meeting held on 18 June 2021 attended by first, second and third defendants null and void.

(5) The attendance by Monica Nita as purported nominee of Department of Finance was void as incumbent Donald Hehona’ sterm had not been terminated.

(6) That other members of PLLGSPA Management Committee, whose names are pleaded in the Statement of Claims be allowed to perform their duties and responsibilities as PLLGSPA Management Board until replacement are made by their respective appointment authorities.

8. The Order of 29 November 2021 in OS (JR) No. 152 of 2021per Deputy Chief Justice had granted the main relief sought including the validity of the appointment of the first plaintiff and invalidity and nullity of purported appointment of first and second defendants.The Court will need to consider the balance of reliefsbeing sought in this proceeding.

Evidence

9. The plaintiffs rely on the following:

(1) Affidavit of Frederick Ipara sworn 30 June 2021 and filed 5 July 2021.

(2) Affidavit of John Ondalane sworn 13 December 2021 and filed 14 December 2021.

(3) Affidavit of Urgency Ipara sworn 6 July, 2021 and filed 6 July 2021.

(4) Affidavit of John Ondalane sworn 10 March, 2022 and filed 11 March 2022.

10. First and third defendants rely on the following affidavits:

(1) Grayson Tau Apakali sworn 18 July 2021 and filed on the 19 July 2021.

(2) Thompson Kwara sworn 24 March 2021 and filed 19 March 2022.

(3) Mark Tony Kepa sworn 24 March 2021 and filed 25 March 2021.

Plaintiffs’ Submission

11. Mr. Haiara of Counsel for the first plaintiff contends and submit that on the day 18 June 2021, a purported PLLGSPA meeting, was held at Gordons, attended by first and second defendants and Monica Nita as representative of Department of Finance and third defendant as Acting Manager of PLLGSPA despite his purported employment being terminated on 11 February 2021. The plaintiffs and other board members were not invited to attend the said meeting.

12. He submits that no record of the meeting was kept despite it being required by the PLLGSPA Constitution and was not produced to Court despite request by plaintiffs’ lawyer.

13. Counsel also submits that on 2 July 2021 in OS No.17 of 2021, in a case filed by Tony Ekepa, the Deputy Chief Justice ordered that landowner clan agents be appointed or elected to appoint their representatives to PLOA. The proceeding was filed by Mark Tony Ekepa against Minister for Mining and Mineral Resources Authority and neither the plaintiffs herein nor the executives of PLOA were named parties to that proceeding nor were heard.

14. He submits that when on the 26 July 2021 the said proceedings OS No. 17 of 2021 dismissed the same with costs for abuse of process and being frivolous and vexatious, the interim injunctive orders against Ruben Nalepe and John Ondalane were automatically discharged.

15. Counsel also submits that on or about 15 September 2021, the National Court per Kandakasi DCJ in new proceedings OS NO. 193 of 2021 endorsed the names of validated clan agents agreed by consent of parties to the proceeding again in the absence of Ruben Nalepe and without him being heard.

16. Mr. Haiara submits that following the Order of 29 November 2021, in the National Court proceeding, OS (JR) No. 152 of 2021, His Honour Deputy Chief Justice having declared the appointment of the plaintiffs and their PLLGSPA membership as endorsed by the Minister valid and effective, it is the purported appointment of first defendant, second defendant, third defendant and Monica Nita that the Court must declare invalid, null and void.

17. Mr. Haiara further contends and submit that on 30 December 2021, in yet another proceeding OS NO.47 of 2021 His Honour the Deputy Chief Justice endorsed the names of certain people including Mark Tony Ekepa as Chairman and executives of PLOA. Mark Tony Ekepa and his purported executives have not appointed any nominees to replace the current legitimate nominees including first and second plaintiffs. Ruben Nalepe and others have appealed that decision in SCA NO. 7 of 2022.

18. In summary based on the Statement of Claim paragraph 35 (1) to (10) filed on 30 July 2021, Counsel for the plaintiffs submits to the Court to consider: -

(1) A declaration that the appointment of the first and second defendants as nominee of Porgera RLLG and Paiela Hewa RLLG to the Management Committee of PSPA is null and void and of no effect as they do not meet educational and work experience criteria prescribed in PSPA Constitution.

(2) A declaration that Mr Donald Hehona remains a Department of Finance and Treasury nominee to the Management Board of Porgera Special Purpose Authority (PSPA) and the purported appointment of Ms Monica Nita declared null and void.

(3) A declaration that Mr Grayson Tau Apakali’s purported employment as Acting Manager of PSPA was validly terminated by PSPA Meeting held on 11 February 2021.

(4) A declaration that the purported PSPA meeting held on 18 June 2021 at Gordons, NCD and the decisions made therein are declared null and void ab initio for reason: -

(a) Meeting was held outside of Porgera; and

(b) Meeting did not achieve a quorum of 6 members.

(5) A declaration that the endorsement of the plaintiffs as members of PSPA Management Board made by the Minister, Honourable Kevin Isifu on 8 February 2019 is valid and effective for all intent and purposes.

(6) A declaration that the PSPA Management Committee Meeting held on 11 February 2021 at Porgera pursuant to the Consent Orders made by Kandakasi DCJ on 5 February 2021 in OS No.190 of 2020 and the decisions made therein are valid and effective and enforceable.

(7) The plaintiffs be allowed to perform their duties and responsibilities as members of PSPA until and unless replaced by their appointing authorities.

(8) An Order that the first, second and third defendants account for and make restitutionfor any moneys they had received from the PSPA as purported PSPA Management Committee Members and Acting Manager.

Defendants Submission

19. Counsel for the first and third defendants contends that Clause 4 of the PDA Constitution provides for its membership. In particular Clause 4 (2) (b) & (c) provides for special mining lease landowners association, which is the PLOA, to nominate four (4) persons to the Board of PDA.

20. Further that pursuant to Clause 5(1) of the PDA Constitution, the terms of appointment of nominees of the PLOA to the Board of PDA is three (3) years.

21. Ms.Nandape submits that as per the statement of claim, the nominees of PLOA were appointed at a PLOA Annual General Meeting held on the 18 July 2018, and thattheir appointment were endorsed bythe then Minister for Inter-Government Relations, Hon. Kevin Isifu on 8 February 2019.
22. She submits that the term of appointment of the first and second plaintiff have already expired on 7 February 2022, and it is therefore necessary to convene a meeting of the PLOA and appoint new nominees to the Board of PDA.

23. As regards the National Court decision made on 29 November 2021 in proceeding OS No. 152 of 2021 which nullified the appointment of the Local level Government representatives to the Board of PDA, Ms Nandape submits that the Minister for Inter-Government Relations had written to the two LLGs on 1 March 2022 to hold their own meetings and appoint their nominees.

24. She submits that events have already overtaken the utility of the current proceeding in that the plaintiffs are no longer directors on the Board of PDA, as their terms hadexpired, and they must apply like everyone else forconsideration for re-appointment or otherwise by the PLOA. Ultimately, the plaintiffs now do not have the standing to seek the orders contained in the Statement of Claim and that most of the orders the plaintiffsseek are matters that can be resolved through meetings of the PDA Board.

Findings

25. The judgment of the Deputy Chief Justice Ambeng Kandakasi in OS (JR) No. 152 of 2021 that much of the factual and legal issues in contention between the parties as pleaded in the Statement of Claim had been determined in favour of plaintiffs in these proceedings. In essence reliefs sought at paragraphs 35 (1), (2), (5) had been granted by the Court in earlier related proceedings. The plaintiff seeks balance of the reliefs sought at paragraph 35 (3), (4), (6), (7) (8) and (9) of the Statement of Claim.

26. The first, second and third defendants in these proceedings were named defendants in OS (JR) No. 152 of 2021. They are represented by the same law firm and Counsel in the Supreme Court appeal SCM No. 65 of 2021.

27. I have considered the net effect of judgment and orders made by the National Court per Kandakasi DCJ on 29 November 2021 in OS (JR) NO. 152 of 2021and find as follows:

(1) The appointment of the plaintiffs as PLOA nominees had been confirmed by National Court on 29 November 2021.

(2) The Board of PLLGSPA under the Chair of the plaintiffs which was recognized and endorsed by Minister for Inter-Government relations Hon. Kevin Isifu on 8 February 2019 is confirmed and validated by term 4of the Court order made 29 November 2021 in OS No. 152 of 2021.

(3) As per His Honour Narokobi in OS (HR) NO. 2 of 2020 ruling on the 4 March 2022, the Court recognized the Board headed by the plaintiffs and that Nandape & Associates Lawyers were ordered to cease acting for PLLGSPA forthwith while Haiara’s Legal Practice was declared as lawyer for PLLGSPA.

(4) The National Court at Term 3 of the Orders declared that the purported appointment of Monica Nita null and void but confirmed the appointment of Donald Hehona.

(5) The Court at Term 1 of the orders declared that the appointment of Thompson Kulara, David Mapuli and Anako Aiyala as members to PLLGSPA management board null and void for failing to meet the educational qualification criteria.

(6) The Court at Term2 of the Orders declared the purported appointment of Grayson Apakali, the third defendant herein as Acting General Manager null and void.

(7) Term 9 of the orders of Court made 20 November 2021 declares that any subsequent decisions made by Thompson Kulara, Anako Aiyala, David Mapuli, Grayson Tau Apakali and Monica Nita null and void. This includes meeting they conducted on 18 June 2021 subject of these proceedings.

28. I also find that the matters of facts pleaded by the defendants’ defence and affidavit’s evidence of Thompson Kulara and Grayson Tau Apakali have been overtaken and rendered of no utility and effect by subsequent events and Court especially: -

(1) The orders of the National Court made on 26 July 2021 in proceedings OS NO. 17 of 2021 which dismissed the entire proceedings for abuse of Court’s process and being frivolous and vexatious and set aside the restraining orders of 9 April 2021.

(2) Orders of National Court made on 4 March 2022 in OS (HR) NO. 02 of 2020 which refused to recognize Thompson Kulara and his Board and the order for Nandape & Associates Lawyers to cease acting for PLLGSPA forthwith.

Conclusion

29. The third defendants have not filed their notice of intention to defend in accordance with Order 7 Rule 1 of the National Court Rules. Further, pursuant to Order 7 Rule 2, National Court Rules a person shall not, except with leave of the Court take any steps in any proceedings unless he has filed originating process or has given notice of intention to defend.

30. The first defendant filed his defence on the 6 August 2021 together with the third defendant who had not filed notice of intention to defend. The third defendant’s defence is therefore defective. Both filed purported amended defence which are invalid for reasons of not seeking leave.

31. The meaning and effect of National Court Rules Order 7 Rules 2 and 6 were enunciated by the Supreme Court in Philip Takori v Simon Yagari (2008) SC905 29 February 2018, per Kirriwom, Gavara-Nanu and Kandakasi JJ at paragraph 11in the following terms:

“A reading of these rules makes it clear that, no person can take any step in any proceeding unless, he or she is the person who issued the proceedings at the first place or has filed a notice of intention to defend in the proceedings, within the time periods stipulated in the Rules of the Court. Nevertheless, a defendant may still file and serve his or her notice of intention to defend any time passed the time period for him or her to do so without leave of the Court. But he or she is not entitled to file and serve his or defence or do anything else except with the leave of the Court. That means no defendant is at any liberty to file and serve his or her defence or take any step in the proceedings without first seeking and obtaining the permission to do so from the Court. We cannot put it any clearer than that.”

32. The effect of the Supreme Court decision is that in so far as Second, Fourth and Fifth defendants are concerned every allegation made against them in the SOC stand admitted by virtue of National Court Rules Order 8 Rule 21 (1) Order 8 Rule 21 (1) relevantly provides:

“Subject to sub-rule (3), an allegation of fact made by a party in his pleading shall stand admitted by any opposite party required to plead to that pleading unless it is traversed by that opposite party in his pleadings or a joinder of issue under Rule 22 operates as a denial of it.”

33. The combined effect of National Court Rules Order 7 Rule 2 and Order 8 Rule 21 (1) is that all allegations made against second, fourth and fifth defendants are admitted and there is no contest to it.

Order

34. In the end, I order: -

1. Ms. Monica Nitta purported nominee of Department of Finance was illegal and null and void and Donald Hehona continue to act as nominee of the Department of Finance.
2. Grayson Tau Apakali’s purported appointment as Acting General Manager of PLLGSPA is null and void as he was terminated on 11 February 2021 by PLLGSPA meeting held on that date.
3. The appointment of first and second defendants as Local Level Government nominees is null and void including any decision they made as PLLGSPA board members.

4. Until their appointment is revoked or replacement appointment by PLOA, the plaintiffscontinue to perform their duties as members of PLLGSPA.

5. Parties bear their own costs of the proceedings.

Ordered Accordingly

________________________________________________________________
Haiara Legal Practice: Lawyers for the first plaintiff
Harry Lawyers: Lawyers for the Second Plaintiff
Nandape & Associates: Lawyers for the First and Third Defendants