National Capital District Commission v Internal Revenue Commission [2022] PGNC 478; N9981 (19 October 2022)

N9981

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS (COMM) No. 11 of 2021 (No. 7)

BETWEEN:
NATIONAL CAPITAL DISTRICT COMMISSION
Plaintiff

V

INTERNAL REVENUE COMMISSION
First Defendant

AND:
SAM KOIM in his capacity as the COMMISSIONER GENERAL OF INTERNAL REVENUE COMMISSION and in his capacity as Trustee of National Capital District Inland GST
Second Defendant

AND:
THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Third Defendant

AND:
CENTRAL PROVINCIAL GOVERNMENT
Fourth Defendant

AND:
MOTU KOITA ASSEMBLY
Fifth Defendant

AND:
GULF PROVINCIAL GOVERNMENT
Sixth Defendant

AND:
EDITH LAUFA in her capacity as Trustee of National Capital District Inland GST Trust Account
Seventh Defendant

Waigani: Anis J
2022: 18^th & 19^th October

NOTICE OF MOTION – Application to recuse a judge – application to vacate hearing – considerations - ruling

Cases Cited:

NCDC v IRC and Ors (2021) N8809
Philip Takori v Simon Yagari (2008) SC905
Wake Goi v First Investment Finance Ltd (2017) N7059
State v Paul Paraka (2020) N8508
Boateng v The State [1990] PNGLR 342
PNG Pipes Pty Ltd and Sankaran Venugopal v. Mujo Sefa & Ors (1998) SC592
Anthony Hamaka & Ors v. Martin Kombri and Ors (2022) N9916
NCDC v IRC and Ors (2022) N9844

Counsel:

D Wood with counsel assisting L Evore and E Lili, for the Plaintiff
S Sinen with Counsel assisting G Wau, for the First and Second Defendants
R Uware, for the Third Defendant
G Wayne, for the Fourth Defendant
N Vada, for the Fifth Defendant
S Dewe, for the Sixth Defendant
M Mukwesipu, for the Seventh Defendant

RULING

19 October, 2022

1. ANIS J: By the plaintiff’s Amended Originating Summons filed on 18 July 2022, it seeks 3 main relief as follows:

1. A declaration that the National Capital District is and was lawfully entitled to receive and be paid and distribute to it the amount equal to 60% of the net GST collected in the National Capital District Province as referred to in section 40(1) of the Inter-Governmental Relations (Functions and Funding) Act 2009 (as amended), without any deduction of any amount by the Internal Revenue Commission to the Central Provincial Government purportedly pursuant to section 33(1), 33(2)(a) and 33(3) of the National Capital District Commission Act 2001 (as amended by section 7 of the National Capital District Commission (Amendment) Act 2021) or otherwise.
   
2. A declaration that the Internal Revenue Commission is and was not lawfully entitled to pay or distribute any of the National Capital District’s share of the National Capital District Inland GST Trust Account equal to 60% of the net GST collected in the Province in the amount as referred to in section 40(1) of the Inter-Governmental Relations (Functions and Funding) Act 2009 (as amended) to the Central Provincial Government purportedly pursuant to section 33(1), 33(2)(a) and 33(3) of the National Capital District Commission Act 2001 (as amended by section 7 of the National Capital District Commission (Amendment) Act 2021) or otherwise.
   
3. The first, Second and Third Defendants, by themselves, their servants and agents be permanently restrained from paying or distributing, or seeking to pay or distribute, any monies to the Central Provincial Government purportedly pursuant to Sections to section 33(1), 33(2)(a) and 33(3) of the National Capital District Commission Act 2001 (as amended by section 7 of the National Capital District Commission (Amendment) Act 2021) or otherwise out of the amount equal to 60% of the net GST collected in the Province as referred to in section 40 of the Inter-Governmental Relations (Functions and Funding) Act 2009 (as amended).
   

2. The matter was set down for hearing for 3 days commencing at 9:30am on Monday 17 October 2022. On that day, the parties raise preliminary issues. The main one refers to the 4^th defendant’s Notice of Motion which was filed on 14 October 2022 (NoM/application). The matter was adjourned to 1:30pm on 18 October 2022 to allow parties to exchange evidence in regard to the NoM.

3. The NoM seeks the following main relief:

“2. Pursuant to Order 10A Rule 22 of the National Court (Commercial Listings) Rules, this proceeding be removed from the Commercial Track for failure to comply with Order 10A Rule 21 of the NCR.

3. Alternatively, pursuant to Order 12 Rule 1 of the National Court Rules, and Section 155(4) of the Constitution, and the inherent jurisdiction of the Court, His Honour Anis J, recuse himself from hearing the Trial and presiding over this proceeding, on the basis of apprehension of bias and/or for demonstrating a predisposition to an issue to be addressed during trial.
4. Consequently, pursuant to Order 12 Rule 1 of the National Court Rules, and Section 155(4) of the Constitution, and the inherent jurisdiction of the Court, the trial date be vacated.”
   

4. The 4^th defendant and the plaintiff filed and relied on their evidence in regard to the NoM. The plaintiff and the 5^th and 7^th defendants contested the NoM. The State took a neutral approach on the matter. The other parties did not present any submissions either for or against the application. I reserved my ruling thereafter to today at 930am.

5. I rule on it now.

ISSUES

6. The plaintiff raises preliminary issues as follows. It claims that the NoM should be dismissed because, (i), the relief sought are not properly pleaded, and (ii), that the 4^th defendant has failed to assert evidence to sustain the claim in order for the plaintiff to disprove. I will deal with them first, and subject to my findings, go on to consider the main issues.

PRELIMINARY ISSUE

7. I note the submissions of the parties on the preliminary issues.

8. In regard to alleged want of clarity in relief 2 and 3 of the NoM, I make this observation. I had queried these as preliminary matters when the NoM was first introduced by the 4^th defendant on 17 October 2022. And in response, counsel for the 4^th defendant clarified the basis or proposed grounds that his client would be raising. As such, although I note the plaintiff’s submission that there was want of clarities, which I uphold, on the same token and given that these had been addressed by the Court and clarified by the 4^th defendant, I refuse and dismiss relief 2 and 3 on the basis of want of clarity or particularity of these relief.

9. In regard to the second preliminary argument on want of evidence to support the claim, I make this observation. Firstly, Order 10A Rule 21 of the National Court Rules (NCR) reads:

“Matters listed by the Registry or on the recommendation of the Registrar.

21. (1) Where a matter already filed at commencement of these rules is listed by the Registry or a matter is listed on the recommendation of the Registrar, the Commercial List Clerk will notify the parties;”

10. So here we are, at the fixed hearing date of the matter, and the 4^th defendant, by this NoM is pointing to this rule, and claims that it has not been followed, so the parties or this Court has to now abort the trial. With respect, the submissions by the 4^th defendant on this matter is baseless, even if it is true. Court rules are there to assist parties progress matters to trial. They are not an end in themselves but a means to an end. See cases: Philip Takori v Simon Yagari (2008) SC905 and Wake Goi v First Investment Finance Ltd (2017) N7059. They could also be dispensed with where required. I also uphold Mr Vada’s submission that the Court has inherent jurisdiction to control proceedings before it, and it need not specifically align a matter like the present matter, with a specific National Court Rules, in order for it to function effectively to progress the said matter to trial. This particular complaint was not raised earlier. It is now raised at the trial date.

11. I will dismiss relief 2 for this reason. I will also dismiss this relief based on want of evidence. I have perused the 3 affidavits filed, that is, affidavit of Mr Wayne and the 2 affidavits of Mr Koaba. I uphold the plaintiff’s submission that none of the evidence support the assertion made by the 4^th defendant that the Registrar or the Commercial Listing Clerk did not notify the parties. But in any event, the events have overtaken this requirement given that no complaint on this rule had been raised earlier by the 4^th defendant and the matter has now been set down for trial. The relief is therefore unfounded and is also dismissed for this reason.

RELIEF 3

12. Given the dismissal of relief 2, I turn to relief 3 which is the alternative relief. The main issue is this, whether I should recuse myself based on alleged apprehension of bias and based on the facts as stated by the 4^th defendant.

13. The allegation is serious and must be looked at carefully.

14. Firstly, I commend both counsel for the case authorities that have been cited on the matter. Justice Berrigan, I think best summarises the case authorities in State v Paul Paraka (2020) N8508. Her Honour referred to cases Boateng v The State [1990] PNGLR 342 and PNG Pipes Pty Ltd and Sankaran Venugopal v. Mujo Sefa & Ors (1998) SC592. At [11] and [12], her Honour stated:

11. In Boateng v The State [1990] PNGLR 342, a criminal case, the Supreme Court adopted the test outlined in R v Liverpool City Justices; Ex parte Topping [1983] 1 WLR 119 at 123 to be applied in determining whether a judge should disqualify themselves for apprehended bias:
    

“Would a reasonable and fair-minded person sitting in a court and knowing all the relevant facts have a reasonable suspicion that a fair trial for the appellant was not possible”.

12. Similarly, in PNG Pipes Pty Ltd and Sankaran Venugopal v. Mujo Sefa & Ors (1998) SC592, it was held that:
    

“[T]he test applied in determining whether apprehension of bias was satisfied was whether an objective observer, knowing all surrounding facts, would be left with an apprehension, not a conviction that the judicial officer was predisposed, by matters extraneous to a proper adjudication, to reach a particular conclusion.”

15 Sevua J, in Gobe Hongu Ltd v. National Executive Council & Ors [1999] N1964 sets out a number of general principles regarding such applications, together with four categories which might give rise to an apprehension of bias. His Honour held at [4] as follows:

“4. A Judge should disqualify himself by reason of apprehension of bias, under one or more of the following principles, where it is demonstrated that, firstly, he has an interest in the case before him, which interest may be direct, indirect, pecuniary or otherwise. Secondly, by his conduct including published statements, whether such conduct is in the course of, or outside the proceedings. Thirdly, where the Judge, through association or relationship, either by himself, his spouse or children, has a direct pecuniary interest in the case. And finally, disqualification by extraneous information, where the Judge had presided over an earlier case or he has had some knowledge of prejudicial and inadmissible facts. Webb v. R [1994] HCA 30; (1994) 181 CLR 41;” [Underlining is mine]

16. I note the submissions of the parties on these.

17. I will summarise the 4^th defendants claim as follows. It alleges firstly, that I am a former employee of the plaintiff’s lawyers’ law firm. This fact is true based on public information that is available of myself as a Judge. I have also summarised that at the start of the hearing of the NoM. I had stated that I had been employed with Blake Dawson Waldron Lawyers as it was known then, now Ashurst Lawyers, from 2002 to 2011, a total of 9 years; that I had resigned from the said firm and had gone on to work with Bradshaw Lawyers from 2011 to November of 2015, a total of about 4 to 5 years. I had also stated that prior to joining Blake Dawson Waldron Lawyers, that I had also worked as a lawyer with Gadens Lawyers as it was then known, now Dentons PNG, from 1997 to 2002, that is, for a period of 5 years. I had also stated that before that, that I was employed with the Ombudsman Commission of Papua New Guinea.

18. The 4^th defendant makes this assertion and attempts to link that fact with its assertion that the plaintiff’s lawyers had deliberately wanted this case to be listed before the Commercial Court; that they had inscribed the OS with the initials (COMM) when they requested for the matter to be listed before the Commercial Court. The reason for that, the 4^th defendant submits, is because I was a former employee of the said law firm.

19. The difficulty I have with these arguments so far is this. The 4^th defendant did not adduce any evidence to support this assertion of the actions of the plaintiff’s lawyers. I had addressed that above. On the other hand and in answer to this assertion, the plaintiff has provided evidence in response, that is, through the affidavit of Mr Evore. The matter was registered as an IECMS matter. Evidence attached therein shows that the request for registration of the case was made to the Registrar of the National Court. It was referred to the responsible Judge Administrator for IECMS matters the Deputy Chief Justice. And it was the Deputy Chief Justice that had referred the matter to the Commercial Court. I commend the plaintiff for bringing this information to the Court’s attention. In my view, since it was the 4^th defendant who had raised this claim against the plaintiff’s lawyers and the judge, it should have been incumbent upon the 4^th defendant and its counsel Mr Wayne, to furnish such information fairly to the Court. Such evidence is not difficult to obtain. Instead, the 4^th defendant has decided to make these serious but vague allegations or accusations without regard to any evidence, that is, unlike the plaintiff who has provided its evidence. Let me adopt herein what I had recently stated in Anthony Hamaka & Ors v. Martin Kombri and Ors (2022) N9916, regarding conduct of lawyers as officers of the Court. At [37], [68] and [69] and I said:

“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 equip 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.

......

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.”

20. I find that the 4^th defendant as well as its counsel Mr Wayne who is an officer of the Court, have failed in that regard, that is, to furnish information that is readily available in the Court registry, to assist the Court against the serious accusations that they are making against me.

21. That said, the evidence of Mr Evore, in my view, disproves the said baseless assertion made by the 4^th defendant, that is, in regard to the claim that it was the plaintiff’s lawyers that had deliberately and successfully acted in a manner that had influenced the matter being referred to the Commercial Court to be listed before me. This assertion by the 4^th defendant is dismissed.

22. The second leg of assertions by the 4^th defendant may be summarised as follows. It refers to earlier interlocutory hearings including directions hearings and asserts that given my connection as a former employee of Ashurst Lawyers, that my actions or decision were made favourable towards the plaintiff’s lawyers. These allegations are mostly captured in Mr Wayne’s affidavit. I have noted them. They are quite long and as such, it is cumbersome to refer to them all in detail and address them one by one. Rather, I will observe them together as they arise out of recent interlocutory and directions hearings that had been conducted.

23. My observation is this. As I had indicated to counsel, it is normal for a party to be dissatisfied with a Court direction or an interlocutory decision that may have been made against the party concerned. We are all humans, and as such, not every decision that is made by a Court may be acceptable to all which may be described as normal human behaviour. That said, I had indicated to counsel that there were processes for addressing them, one of which was to appeal the decision to the Supreme Court. This included this Court’s earlier decision of 30 August 2022 in NCDC v IRC and Ors (2022) N9844. That 4^th defendant may have already done that as it seems. But on the same token, it would in my view be bizarre to, based on these dissatisfactions, claim that these had occurred because the Judge was a former employee of the plaintiff’s lawyers.

24. As I had indicated to Mr Wayne, we judges have had past work experiences with the public or the private sectors before we were appointed to the bench. And as I had indicated as an example, about 80% or more of the judges who are presently serving on the bench had worked for the State before being appointed. So, would that mean that they should not be permitted at all to hear State Claims or Criminal Cases? Of if they make an interlocutory decision or issue directions which are favourable to the State then should these be counted or added up, together with their past employment record as am employee of the State, to form a basis for alleged bias?

25. When I consider the 4 scenarios stated in Gobe’s case, I do not find them applicable or satisfied by the 4^th defendant where I should recuse myself.

26. But because of my findings on want of evidence to the claim under relief 2, it also in my view, weakens the claim of potential perceived bias. The main fact which is not challenged which is available to determine the lay man’s test, that is, Would a reasonable and fair-minded person sitting in a court and knowing all the relevant facts have a reasonable suspicion that a fair trial for the appellant was not possible, is the fact that I used to work with Blake Dawson Waldron Lawyers and Blake Dawson (now Ashurst Lawyers) from 2002 to 2011, that is, about 5 years or so ago before I was appointed as a judge and have worked for about 7 years. Would a reasonable minded person perceive bias against myself on the basis that I had worked with the said law firm, which is now about 11 years ago, and that because of my said past employment and the recent decisions that had been made which were unfavourable against the 4^th defendant, that it should be sufficient and bring about a reasonable suspicion of bias? I would answer that in the negative for the above stated reasons. Also, and with respect, it would be bizarre to regard that as the litmus test or the yard stick to measure apprehension of bias. There has to be sufficient or reasonable facts that must support an assertion or perception of alleged bias as clearly stated in the case law.

27. I note that I had also ruled against general dissatisfaction of a party that may arise out of past interlocutory decisions or directions as sufficient or reasonable basis to assert bias. Again, there is no real or serious accusations that the 4^th defendant has asserted that would cause me to reasonably consider and apply the tests to see whether I should recuse myself.

28. Other evidence adduced such as my past addresses and information that is contained in the web-site Linked in which is available in the internet regarding myself as a lawyer in the past, is information that already exists in the public domain. The same can be said of information that is available to the public about my appointment as a judge. This information can be easily obtained. However, I simply do not see how attaching the said information in Linked in and putting it into evidence can assist the 4^th defendant with its application and assertions, except perhaps to confirm information in regard to my past employment, which is not a secret but as stated, is also in the public domain.

29. The 4th defendant’s claim that a judge should or must caution himself or inform parties of possible conflict is, with respect, misconceived. There is no requirement for that unless the judge considers or determines that such a risk exist or may arise. In my 7 years as a judge, and I had been and continue to, on a daily basis, receive cases that had or have been filed or defended by parties who had or have engaged the services of Dentons PNG formerly known as Gadens Lawyers, Ashurst Lawyers and Bradshaw Lawyers. I have not received complaints of any conflict purely based on my past employment with these firms. This is of course not to say that claims of recusal cannot be made against me as each case may be treated differently, and also, parties do have that right to ask that question if they are aggrieved. But in the event that such a question is raised, that it should be considered on its merits.

30. In this case, after careful consideration and in summary, I find the claim for me to recuse myself baseless. I dismiss relief 3 of the NoM.

SUMMARY

31. I dismiss the NoM. On that note, the trial may proceed of course subject to the other preliminary issue regarding issuance of summons that the parties had raised together with the NoM at the start of the hearing on 17 October 2022.

COST

32. An award of cost herein is discretionary.

33. I will order cost to follow the event. Given the frivolousness or unfounded claims that have been raised by the 4^th defendant as captured in my decision, I will uphold the plaintiff’s submission and order the 4^th defendant to pay the plaintiff, and the 5^th and 7^th defendants’ costs of this application on an indemnity basis which may be taxed if not agreed.

ORDERS OF THE COURT

34. I make the following orders:

1. The 4^th defendant’s Notice of Motion filed on 14 October 2022 is dismissed.
   
2. The 4^th defendant shall pay the plaintiff and the 5^th and 7^th defendants’ costs of this application on an indemnity basis which may be taxed if not agreed.
   
3. Time for entry of these orders is abridged to the date and time of settlement by the Registrar which shall take place forthwith.
   

The Court orders accordingly.

________________________________________________________________
Ashurst: Lawyers for the Plaintiff
IRC In-house counsel: Lawyer for the First and Second Defendants
Solicitor-General: Lawyer for the Third Defendant
Kessadale: Lawyers for the Fourth Defendant
Motu Koita Assembly In-house counsel: Lawyer or the Fifth Defendant
Jema Lawyers: Lawyers for the Sixth Defendant
Mukwesipu Lawyers for the Seventh Defendant