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Arran Energy (Elevala) Ltd v Ol [2023] PGNC 108; N10268 (15 May 2023)

N10268


PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]


OS (JR) NO. 18 OF 2022 (IECMS)
OS (JR) NO. 56 OF 2022 (IECMS) Consolidated


BETWEEN:
ARRAN ENERGY (ELEVALA) LIMITED on its own behalf and as Operator of PRL 21, ARRAN ENERGY (NIUGINI) LIMITED, ARRAN ENERGY (JG) PTY LIMITED, KINA PETROLEUM (PRL 21) LIMITED
First Plaintiff


AND:
ARRAN ENERGY (UBUNTU) LIMITED on its own behalf and as Operator of PRL 28, ARRAN ENERGY (NIUGINI) LIMITED, MEGA FORTUNE INTERNATIONAL LIMITED
Second Plaintiff


AND:
ARRAN ENERGY (UBUNTU) LIMITED on its own behalf and as Operator of PPL 574, ARRAN ENERGY (JG) E&P PTY LIMITED, ARRAN ENERGY (KETU) LIMITED, MEGA FORTUNE INTERNATIONAL LIMITED
Third Plaintiff


AND:
HON KERENGA KUA OL, MP MINISTER FOR PETROLEUM
First Respondent


AND:
THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Second Respondent


AND:
PETROLEUM ADVISORY BOARD
Third Respondent


AND:
DAVID MANAU AS SECRETARY FOR DEPARTMENT OF PETROLEUM & ENERGY AND DIRECTOR OF PETROLEUM
Fourth Respondent


Waigani: Kandakasi, DCJ.
2023: 28th April
2023: 15th May


STATUTORY INTERPRETATION – Relevant principles – Purposive approach – Purpose of s. 35 of the Interpretations Act – Decision makers other than Courts have power to review, vary or revoke their decisions – accords well with efficacy in administration and avoid litigation and consequences.


JUDICIAL REVIEW - Purpose of judicial review of administrative decisions – check and ensure decision makers follow due process to arrive at their decision – Propriety of decision maker reviewing his own decision to accord what a plaintiff is complaining about – Courts emphasis on parties to settle all disputes brought to court – judicial review matters no exception – Section 35 of Interpretation Act accords well with the need for decision makers to review, revise, vary or revoke their decision in order to resolve a matter brought to Court.


Cases Cited:
SC Ref No. 1 of 2017: Reference by the Ombudsman Commission in the matter of the Constitution, Section 28(5) and the Organic Law on the Duties and Responsibilities of Leadership, Sections 27(4) and 28(1) (2017) SC1645.
The State v. Downer Constructions (PNG) Limited, (2009) SC979.
South Seas Tuna Corporation Limited v. Betty Palaso as Commissioner General, Internal Revenue Commission and Anor (2019) SC1761.
The State v. Tamate & Ors (2021) SC2132.
Haiveta v. Wingti & Ors [1994] PNGLR 197.
Avona v. The State [1986] PNGLR 148.
William Mel v. Coleman Pakalia & Ors (2005) SC790.
Gene v. Thompson (2007) N3254.
Tindiwi & Ors v. Nilkare, Minister for Provincial Affairs, and The State [1984] PNGLR 191.
Application by National Capital District Interim Commission [1987] PNGLR 339.
Bougainville Copper Foundation v Minister for Trade and Industry [1988-89] PNGLR 110.
Gegeyo v. Minister for Lands and Physical Planning [1987] PNGLR 331.
Nelson v. Pruaitch, Minister for Forests (2003) N2440.
Nuia v. Sabumei [1992] PNGLR 90.
Hargy Oil Palm Ltd v. Ewasse Landowners Association Incorporated (2013) N5441.
Alex Awesa & Anor v. PNG Power Limited (2014) N5708.
Wantok Gaming Systems Ltd v. National Gaming Control Board (2014) N5809.
Meckpi v. Fallon (2017) N6708.
PNG Ports Corporation Ltd v. Canopus No 71 Ltd (2010) N4288.
Able Construction Ltd v. W.R. Carpenter (PNG) Ltd (2014) N5636.
Robmos Ltd v. Fredrick M Punangi (2017) N6585.
NCDC v. Yama Security Services Pty Ltd (2003) SC707.
Henry Torobert v. Mary Torobert (2012) SC1198.
Kalinoe v. Paul Paraka Lawyers (2014) SC1366.
Re Internal Security Act; Reference by the Ombudsman Commission [1994] PNGLR 341.
Reference by the Ombudsman Commission Pursuant to Constitution, Section 19(1), Re Public Money Management Regularisation Act 2017 (2020) SC1944.

Counsel:
E. Enderson and S. Supro, for the Plaintiffs
R. Uware and E. Bua, for Second Defendant
J. Holingu, for the First and Fourth Defendants
J. Wohuinangu, for the Third Defendant


15th May, 2023

  1. KANDAKASI DCJ: By consent of the parties, the Court heard and reserved its decision on a single question. The question is what is the meaning and effect of s. 35 of the Interpretation Act on the applicability of the common law doctrine of functus officio?

Background

  1. This preliminary issue arose because the First Respondent Hon. Kerenga Kua, Minister for Petroleum (the Minister) retracted a decision made by him on 03rd February 2022 refusing to grant the plaintiffs (Arrans) application for a petroleum development license, PDL 12 (the First Decision). He then replaced his First Decision with a new decision on 05th May 2022 (the Second Decision). The Second Decision indicated the Minister’s intention to refuse Arrans’ application and gave several reasons. At the same time, he invited them to respond to the reasons within 30 days. That decision was in response to the proceeding under OS (JR) 18 of 2022 which in the main seeks a review and quashing of the First Decision as well as an unknown decision of the Petroleum Advisory Board (PAB). From Arrans’ Statement pursuant to Order 16, Rule 2 (a) of the National Court Rules, in addition to the main reliefs sought they also seek orders for the Minister to give detailed reasons, for his decision and for them to be given 30 days to respond. Instead of responding as required by the Minister’s Second Decision, the Arrans filed OS (JR) 56 of 2022. This led to the Minister and the rest of the defendants applying by notices of motion for a dismissal of the proceedings.

Relevant Facts


  1. The facts giving rise to the issue and the two different proceedings are these. In March 2014, Arran applied for a Petroleum Development License (APDL12) under the Oil and Gas Act 1998. On 16th September 2021, they amended their application. On 03rd February 2022, the Minister refused Arran’s application for APDL 12. That cause Arrans to commence on 09th March 2022 their judicial review proceeding, OS (JR) 18 of 2022. Faced with that proceeding, the Minister on 04th May 2022 decided to retract and revoke his First Decision and have it replaced with his Second Decision and issued a new instrument. As noted, that decision gave notice of the Minister’s intention to refuse a grant of Arran’s application and gave reasons for that decision. The decision also gave Arrans 30 days for them to respond to the reasons. By letter dated 05th May 2022, the Minister communicated his decision to the Arrans. That communication informed Arrans about the retraction, issuance of his Second Decision and the issuance of a new instrument pursuant to section 56B of the Oil and Gas Act.
  2. Meanwhile, also on 05th May 2022, OS (JR) No. 18 of 2022 (IECMS) came before me. After having heard the parties, I decided to grant Arran’s application for leave for judicial review. I also ordered that the grant of leave operate as a stay of the relevant decision.
  3. On 22nd May 2022, the Minister filed an application to dismiss OS (JR) No 18 of 2022 (IECMS) for being an abuse of process and disclosing no reasonable cause of action. The very next day 23rd May 2022, Arrans commenced OS (JR) No 56 of 2022 (IECMS) seeking amongst others, an order to quash the Second Decision. On 03rd June 2022, Tamade AJ granted leave for review and adjourned to 09th June 2022 for a hearing of a stay application. In the meantime, an interim stay of the Second Decision was granted. On 4 June 2022 the Respondents’ time to respond to notice lapsed. On 8 June 2022 the Minister and Fourth Defendant (the State) each filed applications for a dismissal of OS (JR) No 56 of 2022 (IECMS) for being an abuse of process and disclosing no reasonable cause of action. On 09th June 2022, Tamade AJ heard Arrans’ application for stay of the Second Decision and had that granted. Her Honour also directed the application to dismiss the proceeding in OS (JR) 18 of 2022 (IECMS) to be heard at the trial together with OS (JR) NO 56 of 2022 (IECMS). Her Honour then adjourned the proceedings to 24th June 2022 at 9.30am for directions.

Parties Arguments


  1. The Minister and the other defendants applications for dismissal argued that, the Minister in his Second Decision, effectively granted the reliefs sought by Arrans in OS (JR) 18 of 2022 with reasons given. Also, the Second Decision was an interim decision indicating the Minister’s intention to refuse Arrans’ application for reasons given subject to hearing Arrans. That meant the decision was not final and hence, the decision is not open for judicial review. Arrans, however, argue that the Minster is not permitted to revoke his initial decision and issue a fresh notice under section 56B of the Oil and Gas Act 1998 as amended based on the application of the common law doctrine of functus officio. This is so they say because, the Minister’s First Decision was final and conclusive in nature and the Minister had become “functus officio.” In their response, the Minister and the State argued to the contrary and rely upon the provisions of s. 35 of the Interpretation Act. Under that provision they submit, the Minister did have the power to retract and replace his First Decision with the Second Decision.

Consideration: law


  1. Obviously, the issue will be resolved by what interpretation and meaning the Court gives to s. 35 of Interpretation Act. It is therefore necessary to turn to the wording of the provision in question. The provision reads:

“35. Implied Power to Alter

Where a statutory provision confers a power to make an instrument or decision (other than a decision of a court), the power includes power, exercisable in the same manner and subject to the same conditions (if any) to alter the instrument or decision.”


  1. I will allow myself to be guided by the principles governing statutory interpretation which is trite law. I have alluded to the relevant principles in numerous cases. One such case is in the matter of SC Ref No. 1 of 2017: Reference by the Ombudsman Commission in the matter of the Constitution, Section 28(5) and the Organic Law on the Duties and Responsibilities of Leadership, Sections 27(4) and 28(1) (2017) SC 1645. There at [136] and [137] stated the relevant principles in this way:

“This being a constitutional provision I remind myself of the principles governing the interpretation of any constitutional law and other statutory provisions in our jurisdiction. The principles are well settled. As noted in many decisions of the National and this Court, Wilson J, stated the relevant principles in PLAR No 1 of 1980 [1980] PNGLR 326. After discussing the different approaches to statutory interpretation, he said:


‘... there is no place in a developing country where the courts, as well as the Law Reform Commission, are given special responsibilities in the process of development, for the narrow interpretation of statutes without adequate regard to the social purpose of particular legislation. Development is difficult to achieve if courts adopt too conservative an approach to the interpretation of statutes. There has been a tendency in our National Judicial System, less evident in some recent decisions of the courts but still perceptible, to over-emphasize the literal meaning of a provision at the expense of the meaning to be derived from other possible contexts; the latter including the application of the “mischief” rule, the recognition of the general legislative purpose, as well as the obligations laid down under the Constitution such as, for example, the obligation upon the courts in interpreting the law to give ‘paramount consideration to the dispensation of justice’.


Many subsequent cases in which the Supreme and National Courts have been called upon to interpret legislative provisions, they have consistently allowed themselves to be guided by these principles. An example of that happening is in the case of SCR No 1 of 2000; Re Morobe Provincial Government for and on behalf of the Morobe Provincial Executive Council (2002) SC693. There, the Supreme Court said in the context of the Value Added Tax legislation:


‘... it is now an accepted principle of both constitutional and other statutory interpretation, that provisions of the Constitution and all Acts of Parliament must be given their fair and liberal meaning. This is so as to give effect to the intent of Parliament behind the provisions in question. There is a long line of case authority on that.’”

  1. To this, I add three more principles. The first two are by way of exceptions to the above principles. I noted the exceptions in several cases already. An example of that was in my dissenting decision in the Supreme Court decision in The State v. Downer Constructions (PNG) Limited, (2009) SC979 at [68]. There, I noted the two known exceptions in these terms:

“The first is in cases where the words used in the legislation under consideration are so plain and clear that no art of interpretation is required... The second is in tax legislation cases, where the strict interpretation rule applies... In such cases, the law is that, for the imposition of a tax or charge against a subject, clear and unambiguous intention must be shown in the statute... Otherwise, an interpretation favourable to taxpayers would be preferred.”


  1. The third is by way of addition. I stated the relevant principle also in the Downer Construction (supra) case at [69] in the following terms:

“...there is a further well accepted principle of statutory interpretation. That is in the area of, what is included and excluded in any legislation. It is a well-accepted principle that, where the legislature provides for inclusions or exclusions, the opposite is intended for the matters not included or excluded, as the case might be. I referred to the decision of the Supreme Court in SCR No. 1 of 2000; Re Morobe Provincial Government for and on behalf of the Morobe Provincial Executive Council... as an example of a case on point.”

  1. Since, the learned counsel for Arrans almost solely rely on the decision of the Supreme Court in South Seas Tuna Corporation Limited v. Betty Palaso as Commissioner General, Internal Revenue Commission and Anor (2019) SC 1761 in support of their arguments, it is necessary for us to start with that. Relevantly, the Court there, held per Collier J with Nablu and Neill JJ agreeing[1] at [77] as follows:

“Having regard to the authorities I have examined earlier in this judgment, it appears that the following general principles are applicable in other common law jurisdictions, and thus applicable in Papua New Guinea:


  1. Arrans through their learned counsel argue, there is an absence of the test of “nullity” and the “contextual” exceptions. They also argue that in the context of the South Seas Tuna case, the Court considered the Interpretation Act and explicitly rejected the application of s. 25 of the Act. In so submitting, they point out that no counsel in that case, put to the Court, but if the Court on its own motion considered the provisions of s. 35 of the Interpretation Act, that would not have changed its decision because it obviously does not. Counsel for Arrans go on to further submit that, on the face of the Minister’s First Decision, it matches that prima facie criteria pursuant to the South Seas Tuna decision perfectly. Consequently, they submit, the State has the difficult task of demonstrating it is not prima facie functus officio. Similarly, they say, if there was any support at all in the “text, context and purpose” of the specific Oil and Gas Act provisions under review for the decision to be an exception to the prima facie position pursuant to South Seas Tuna case, the State would have alleged that to be the case, but it did not. This they say is the case because there is nothing in the “text, context and purpose” of the specific Oil and Gas Act decisions that are under review that would take it out of the prima facie position.
  2. In my view, several factors preclude an acceptance of Arrans’ submission by this Court. Firstly, the Supreme Court decision in South Seas Tuna case at [23] and [24] noted on the issue of functus officio, that:

“23. At the hearing of this appeal during submissions, Counsel for the respondents made the specific concession that the respondents accepted that, once the amended GST assessment was made on 24 June 2016, the decision of the Commissioner was functus officio in respect of that assessment. To that extent, it appeared that, by the conclusion of submissions, the only legal dispute between the parties concerned the point at which an assessment was made – the appellant claims that an assessment was made by journal entries in January 2016.


24. The effect of this concession on the part of the respondents is that, to the extent the appeal concerns the decision of the primary Judge in respect of the application of the principle of functus officio, the respondents appear to agree that his Honour erred at [13] of the primary judgment in his statement of relevant legal principles. However, so far as I am aware, there have been no authorities in Papua New Guinea considering the broader relevance of the principle of functus officio to administrative decisions and the more specific issue concerning the application of the principle to decisions of the Commissioner under the GST Act. Accordingly, and notwithstanding the apparent common ground of the parties in respect of the application of the legal principle of functus officio to an assessment of the Commissioner, it is appropriate for the Court to consider this issue and make relevant observations.”

(Underlining added)


  1. From this, it is clear to me that, the issue of functus officio was not an issue between the parties in the South Seas Tuna case. Hence, it was not necessary for the Court to go into any detailed consideration of the subject and decide any matter in controversy between the parties. Despite that, the Court decided to make it an issue and devoted a large part of its decision to that issue. Clearly in my view therefore, the Court’s views were obiter dictum. Such decisions are not binding.[2]
  2. Secondly, the general position on a decision maker being functus officio needs to be consider subject to the relevant statutory law in any given situation. Such law includes for example any subject or area specific legislation such as the Oil and Gas Act or provisions of other statute[3]. The provisions of generally applying legislation need not be specifically provided for in any subject or area specific legislation. For it is well accepted that, unless the applicability of such provisions is specifically excluded or a different position is clearly provided for, they apply. It is thus well accepted that, the provisions of the Interpretation Act, apply to fill any vacuum or lacking in any other legislation. The Act itself at s. 2 clearly states the law in the following terms:

“2. Application.

(1) Except where in this Act the context indicates otherwise, or some other meaning is clearly intended, this Act applies to every statutory provision (including this Act) whenever made or adopted.

(2) The rules contained in this Act apply in accordance with Subsection (1) unless the context of any particular statutory provision indicates otherwise, or some other meaning is clearly indicated by a particular statutory provision.

(3) This Act binds the State.”

(Underling added)


  1. Given this clear provision, there has not been much of a controversy on the application of the provisions of the Interpretation Act to all other legislation.[4] However, in a few cases where the issue has arisen, the Court has clearly re-affirmed the applicability of the Interpretation Act. An example of a case on point is the decision in Gene v. Thompson (2007) N3254. There, Injia DCJ (as he then was) held at [15]:

“I accept Mr Raka’s submission that the Interpretation Act applies to all statutes including the Lawyers Act. Section 2(1) of Interpretation Act says the provisions of the Act applies to ‘all statutes’. In a situation where there is a doubt or ambiguity as to the use of a term or phrase in a statute, or there is lack of provision in a statute on a particular subject matter, it is intended that the relevant provisions of the Interpretation Act should apply.”


  1. Thirdly, the context in which the Court in the South Sea Tuna case considered the issue of functus office was, amongst others, whether the Internal Revenue Commission (IRC) had the power to make alterations to goods and services tax (GST) assessment.[5] That necessarily required first, a consideration of whether the relevant legislation, namely the Goods and Service Tax Act (GST Act) made any provision for any alternation, additions or revocation of the IRC’s earlier decisions or assessments. If the Act was silent on that, the next legislation to consider would have been the Interpretation Act.
  2. The learned trial judge in the South Seas Tuna case correctly noted, s. 67 (3) and 83 of the GST Act, specifically empowered the IRC to alter or add to assessments. These provisions read:

Section 67(3) of the GST Act:


“Subject to Section 72, the Commissioner may from time to time and at any time make all such alterations in or additions to an assessment made under this section as the Commissioner thinks necessary to ensure the correctness thereof, notwithstanding that tax already assessed may have been paid.”


Section 83 of the GST Act:


“The determination of an objection under this Part shall relate solely to the assessment or decision (as defined in Section 73(1)) objected to and shall not affect the right of the Commissioner to make any other assessment or such decision in respect of the objector, or to amend the assessment or such decision objected to in any manner rendered necessary by that other assessment or such decision.”

(Underlining added)


  1. At [13] to [15] of his judgement, as noted by the Supreme Court at [18] the learned trial judge in that case arrived at the view that:

“13. To my mind, as a determination of an objection of an assessment or decision does not affect the rights of the Commissioner to make another assessment or decision in respect of the objector, or to amend the assessment or decision objected to, and “The determination of an objection under this Part...” includes, amongst others, objections referred in the first instance to the National Court for determination by way of case stated, it is intended that the power of the Commissioner in regard to making other assessments or amendments to assessments or decisions is not to be fettered, by for instance, an objector invoking the judicial procedures of the GST Act.

14. This is supported by s67 (3) GST Act providing that the Commissioner may from time to time and at any time make alterations or additions to an assessment.

15. Consequently, if the doctrine of functus officio as to administrative decisions as submitted on behalf of South Seas Tuna, does apply in this jurisdiction, and it has not been necessary to determine that question in this instance, then in my view from a perusal of the provisions of the GST Act and in particular the wording of s. 67 (3) and 83 GST Act, they do not permit the doctrine to apply in relation to the GST Act. The relief sought by South Seas Tuna should be refused...”


  1. The Supreme Court upheld the trial judges view at [94] in these terms:

“In our view, the statutory scheme created by the GST Act evinces a contrary intention to the principle of functus officio applying in respect of valid assessments under that Act and includes circumstances where a case is stated for the National Court pursuant to s 77. If follows that the conclusion the primary Judge reached at [15] of the primary judgment was correct.”


  1. Before arriving at the decision, the Court noted that, s. 67 (3) of the GST Act was subject to s. 72 of the same Act, which places a limit on the powers under s. 67 (3). Then rejecting a submission for adding more restrictions by the doctrine of functus officio, the Court held relevantly at [89] - [91] that:

“89. Second, where specific restrictions have been included, as is the case in these circumstances by the inclusion of s 72, the Court should be less ready to imply additional restrictions into the statute. The inference can reasonably be drawn by the Court that Parliament has already directed its mind to defining the power of the Commissioner to amend assessments under the GST Act.


90. Third, although the appellants raise what is potentially a legitimate concern about the manner of exercise of the powers by the Commissioner under ss 67(3) and 83, that does not mean that the Court should interpret those powers so narrowly that, in effect, those powers cannot actually be exercised. The application of the functus officio principle in interpreting s 67(3) would effectively neuter the operation of that section – indeed, the specific inclusion of a power of amendment would be futile were the Court to adopt the approach contended for by the appellant. This is inconsistent with the apparent purpose of its inclusion.


91. The legislative policy in s 67 of the GST Act is that the Commissioner may revisit tax as paid by the taxpayer and make assessments of the amount that, in the Commissioner’s judgment, is payable under the GST Act. As Judges of the High Court of Australia observed in Commissioner of Taxation v Ryan [2000] HCA 4; (2000) 201 CLR 109 at [22] in respect of income tax:


... it must be recognised that the call may be made well after the year of income concerned. This may well cause hardship, or at least inconvenience, to a taxpayer who has ordered his or her affairs on the basis of the Commissioner’s earlier statement that nothing was owed. But hardship or inconvenience is seldom, if ever, sufficient reason for not complying with a statutory obligation.”


  1. Further, the Supreme Court went onto rejecting a strong argument that once an object to an assessment is stated to the National Court or is accepted by the IRC respectively under s. 74 (2) and s. 77 (9) or s. 72 (1) of the GST Act, the IRC is functus officio The Court reasoned at [92]:

“Certainly, there is no specific provision in the GST Act which provides that, once a case has been stated to the National Court pursuant to s 77(9) of the Act, or an objection process has been commenced by the taxpayer, the Commissioner’s amendment powers are “frozen” or “suspended”. Indeed, it may be argued that the possibility of the Commissioner amending the assessment is contemplated to some degree by s 77(15) the GST Act, which allows the Commissioner to amend her case stated prior to it being set down for hearing.”


  1. With respect, all learned counsel appearing before me failed to properly assist the Court with the question of how the Supreme Court applied the principles on functus officio to the case that was before the Court. This failure is evident in the learned counsels’ failure to correctly answer this Court’s question at the hearing of, why or how the Supreme Court failed to consider the provisions of s. 35 of the Interpretation Act. The foregoing consideration of the relevant parts of the Supreme Court’s decision provides a plain and obvious answer. The answer is, s. 67 (3) and 83 and the other provisions of the GST Act make specific provision for the question of powers vested in the IRC to revisit and alter, add, or revoke an earlier assessment of GST tax. That rendered any consideration of the provisions of s. 35 of the Interpretation Act unnecessary, inappropriate, and irrelevant.
  2. Fourthly, in the South Seas Tuna case, the appellant, South Seas Tuna Corporation Limited specifically raised an argument that s. 32 of the Interpretation Act does not apply in the context of its claim of functus officio once it had lodged objections to certain of the GST assessments. Section 32 reads:

32. Continuing Effect of Powers and Duties

Where a statutory provision confers a power or imposes a duty, the power may be exercised, or the duty shall be performed, as the case may be, from time to time as occasion requires.”

  1. As I explained earlier, the provisions of the Interpretation Act applies if the area or subject specific legislation is silent on a matter in issue. In South Seas Tuna case, the subject matter was GST assessments and any alterations or additions to such assessments. The relevant Act, being the GST Act was not silent on that point. Specific provisions were made in respect of the issue in the relevant subject legislation. That excluded any consideration of any provisions of the Interpretation Act. Hence, the Supreme Court correctly, found s. 32 of the Interpretation Act inapplicable.
  2. This leads us to the fifth problem with Arrans’ submissions. If there was a vacuum in the South Seas Tuna case, the most relevant, correct, and applicable provision was s. 35 and not s. 32 of the Interpretation Act. I am of the view that, the appellant in the South Seas Tuna case deliberately argued for an application of the common law doctrine of functus officio as against the clear import of the relevant provisions in the GST Act as well as s. 32 of the Interpretation Act. A reference to s. 35 would have fortified the provisions already made in ss. 67 (3) and 83 of the GST Act itself and the decision ultimately arrived at by the learned trial judge in that case as subsequently approved by the Supreme Court.
  3. Sixthly, and most importantly, the position taken by the appellant in the South Seas Tuna case went against the clear dictate of s. 9 of the Constitution as to the hierarchy of laws in the country. Pursuant to that provision, the supreme law of the land, the Constitution has ordered in clear terms that, Acts of Parliament are superior to and they take priority over rules of the underlying law, which includes the common law doctrines and principles as adopted and applicable in our country pursuant to s. 20 of the Constitution[6] and the Underlying Law Act 2000. Such laws are at the very bottom of the list of laws that are applicable in PNG. Hence, any common law doctrine such as the doctrine of functus officio or any judicial pronouncement in PNG, do not and cannot be allowed to override the clear and expressed provisions of any legislation such as the GST Act or the provisions of the Interpretations Act.
  4. Seventhly, the provisions of s. 35 of the Interpretation Act has already been considered in several cases prior to the decision in South Seas Tuna case. One of the cases on point is the decision of Amet J (as he then was) in Application by National Capital District Interim Commission [1987] PNGLR 339. In that case, the Minister for Lands decided to revoke certain land reservation declarations made under s 25 of the Land Act. The Land Act did not vest in the Minster any power to revisit his earlier decision and revoke them. The Court noted the problem and resolved the issue in this way:

“There is no provision in the Land Act enabling revocation, suspension or variance of such a declaration. It would seem that the Minister relied upon the provisions of the Interpretation Act (Ch No 2) the [sic] exercise the right to revoke or vary the initial exercise of power under s 25. This is enabled by s 35 of the Interpretation Act which reads as follows:


‘Where a statutory provision confers a power to make an instrument or decision (other than a decision of a court), the power includes power, exercisable in the same manner and subject to the same conditions (if any) to alter the instrument or decision.’


Without embarking upon an analysis of all of the arguments for and against, I am of the opinion that s 35 does enable a decision-making authority such as the Minister or a tribunal exercising statutory power of decision-making to alter, vary, modify or revoke as the case may require, the said decision, upon good grounds. And so I am satisfied that there is power to revoke, alter or vary any declaration under s 25 for good and justifiable reasons. I would expect such reasons to be in the public interest and public welfare.”

(Underlining added)

  1. Bredmeyer J came to a similar decision in Bougainville Copper Foundation v Minister for Trade and Industry [1988-89] PNGLR 110. There, the issue was s. 7 of the National Investment and Development Act (Ch No 120). That provision empowered the relevant Minister to exempt a foreign enterprise from the operation of specified provisions of that Act ‘after receiving a report from the National Investment and Development Authority’ and ‘by notice in the National Gazette’. It was however silent on the relevant minister’s power to revoke such exemptions. The application of s. 35 of the Interpretation Act was an issue between the parties.
  2. The Foundation argued that s.35 had no application as that section, and all the rules in the Act, do not apply where the particular Act indicates a contrary intention. But the Court rejected that argument and said:

“I can see the force of that argument, nevertheless I consider it should fail. It is highly desirable that there should be a power of revocation and I believe that it was intended. I consider that the general power of revocation contained in s 35 of the Interpretation Act applies to s 7.”

  1. Other provisions in the Interpretation Act, such as s. 36 which is in similar wording as s. 35 have received similar interpretations and applications by the courts. That provision reads:

“36. Implied Power to Remove or Suspend

(1) Where a statutory provision confers a power to make an appointment, the

power includes power, subject to Subsection (2), to remove or suspend a person so appointed.

(2) The power provided for by Subsection (1) is exercisable only subject to any conditions to which the exercise of the original power of appointment was subject.”


  1. The position the courts have taken on the interpretation and application of this provision is represented by the decision in Gegeyo v. Minister for Lands and Physical Planning [1987] PNGLR 331. There, Court had to deal with s. 6 (3) of the Land Act (Ch No 185), (under which appointments to the Land Board are made). That Act made no specific provision for revocation, variance or altering decisions on appointment of the members of the Land Board. The Court per Amet J (as he then was) held:

“I accept that s 36 of the Interpretation Act does apply to the construction of s 6(3) of the Land Act. Secondly, I find that the Minister does have the legal power to remove or suspend appointments made under s 6(3) of the Land Act pursuant to the powers enabling him by s 36 of the Interpretation Act.”[7]

  1. In the present case, none of the counsels for any of the parties and more so Arrans’ drew to the Court’s attention, the existence of any of the cases I referred to and discussed above. By reason of that failure, they also failed to assist with any submissions on how the decisions in those cases have gotten it wrong and or that their arguments for an application of the doctrine of functus officio should be accepted, without any regard to those decisions.

Present case


  1. In the present case, there is no contest between the parties that the Oil and Gas Act 1998 as amended, makes no provisions in terms similar to the provisions of s. 35 of the Interpretation Act or ss. 67 (3) and 83 of the GST Act. In other words, the parties are agreed in the present case that, the Oil and Gas Act is silent on the question of the Minister’s power to retract, recall and or revisit his earlier decisions and vary them by alterations, additions, or revocations. Similarly, I have not been assisted with any considered submission especially from Arrans as to how the text or context of the Oil and Gas Act precludes an application of s. 35 of the Interpretations Act and hence, the Minister having the necessary power to retract his First Decision and replace it with his Second Decision. When that is the case, s. 35 of the Interpretation Act as interpreted and applied in the earlier cases of Application by National Capital District Interim Commission and Bougainville Copper Foundation apply to the Oil and Gas Act and therefore this case. That being the case, the doctrine of functus officio as discussed and applied in the South Seas Tuna case does not apply to the present case. Consequently, I am of the view that the Minister did have the powers by virtue of s. 35 of the Interpretation Act to retract from his First Decision and replace it with his Second Decision.
  2. There are three further foundations for holding that the doctrine of functus officio has no application independent of s. 35 of the Interpretation Act and the forgoing discussion in administrative decisions unless a subject specific legislation clearly and expressly provides for the application of that doctrine. The first of the three factors is that, modern judiciaries recognise the parties in a dispute’s autonomy and or right of self-determination in the resolution of their conflicts or disputes.[8] For any decision they make and resolution they themselves arrive at, finally and fully resolves all issues between them and they can live with that as opposed to a court decision imposed upon them.[9] Consistent with that recognition, Parliament added Part IIA of the National Court Act in 2008 through National Court Amendment Act 2008 (Number 4 of 2008). Based on that legislative foundation and the provisions of s. 184 of the Constitution, the Judiciary on its part promulgated the ADR Rules 2010.
  3. I commented upon the main drivers of these legislative changes in several cases. One of them is the decision in Koitaki Plantations Ltd v. Charlton Ltd (2014) N5656.[10] There, I stated:

“Driven by a desire to overcome the problem of backlogs and to ensure delivery on the wish to resolve conflicts expeditiously at less costs in a timely manner, ADR and in particular mediation were introduced. This started in the United States in 1975 and eventually spread throughout the world. In our jurisdiction, ADR and mediation found their way into legislation such as s. 22B of the District Courts Act (Chp.40) and the National Court Act (Chp. 38) as amended. Pursuant to s. 7E of the National Court Act the ADR Rules were promulgated. Since their inception, ADR and mediation began and continue to deliver on the desire that led to their introduction so much so that the world was persuaded to accept them. As I observed in Koitaki Plantations Ltd v. Charlton Ltd, ... and elsewhere, because of that good result:


‘...the courts and governments all over the world are calling for the use of mediation as a preferred form of dispute resolution, given its benefits. Many countries have now gone further and required mandatory mediation either prior to the issuance of proceedings or before any trial takes place in court. In our case, the effect of r. 4 of the ADR Rules as already noted presupposes mediation unless the court otherwise determines on the application of a party. The imperative therefore is for disputing parties to explore prospects of out of court settlement and where possible settle through their direct negotiations and failing any settlement there, through mediation in ‘good faith.’”

(Underlining added)


  1. The Supreme Court at the highest in our country, has spoken in favour of the ADR and mediation. This started with the decision of the Supreme Court in NCDC v. Yama Security Services Pty Ltd (2003) SC707 where the Court said:

“Indeed, there is a fast developing trend in modern courts including our own, to move away from court litigation and encourage alternative ways of settling civil disputes. Courts nowadays increasingly and actively foster, encourage and even facilitate parties to negotiate, mediate, and settle claims before the courts using alternative dispute resolution (ADR) techniques and mechanisms. The benefits of ADR are many and these include a win-win situation for both parties, reduces unnecessary litigation time, expense and costs, and maintains amicable long term business and social relationships between parties. Indeed notions of negotiation, mediation and compromise of disputes is a long-standing traditional custom in all traditional societies in this country and our courts should be able to tap into this valuable custom and develop ADR procedures which are appropriate to our own circumstances.”


  1. Nine years later, the Supreme Court had reason to repeat its support for more use of mediation and other forms of ADR in its decision in Henry Torobert v. Mary Torobert (2012) SC1198. There the Court said in the context of a matrimonial proceeding:

“A dispute over matrimonial property by its very nature lends itself to negotiation, mediation and settlement. We have in PNG through recent amendments to the National Court Act and the making by the Judges of the ADR Rules 2010 embraced the concept of alternative dispute resolution and put it increasingly into practice. We consider that these practices should be adopted by the Supreme Court which has the power under Sections 6(2), 8(1)(e) and 16(c) of the Supreme Court Act to exercise the powers available to the National Court (William Moses v Otto Benal Magiten (2006) SC875). This includes the power to order parties to attempt settlement and, in the event of a failure to settle, to order mediation. Those are the type of orders that we will seriously consider making here. A dispute over matrimonial property by its very nature lends itself to negotiation, mediation, and settlement. We have in PNG through recent amendments to the National Court Act and the making by the Judges of the ADR Rules 2010 embraced the concept of alternative dispute resolution and put it increasingly into practice. We consider that these practices should be adopted by the Supreme Court which has the power under Sections 6(2), 8(1)(e) and 16(c) of the Supreme Court Act to exercise the powers available to the National Court (William Moses v Otto Benal Magiten (2006) SC875). This includes the power to order parties to attempt settlement and, in the event of a failure to settle, to order mediation. Those are the type of orders that we will seriously consider making here.”


  1. Two years after the above Supreme Court decision, I gave thought to the question of what kinds of cases or questions are inappropriate for mediation. That was in the case of Able Construction Ltd v. W.R. Carpenter (PNG) Ltd (2014) N5636. The aim of that exercise was to assist and enable litigants and their lawyers to be proactive around expedited resolution of disputes through the referral of cases to mediation or trial or both without unnecessary delay. At paragraph 18 of the judgment, I made the following statement and listed the kinds of cases or questions inappropriate for mediation:

“This worldwide focus on mediation is not surprising as mediation is suitable for all cases. The only exception to this would be cases in which mediation is inappropriate because:


  1. Additionally, in Able Construction Ltd v. W.R. Carpenter (PNG) Ltd, I commented upon the duty of lawyers in each case in the light of the developments and reasons for introducing and promoting ADR and in particular mediation. Relevantly, I said:

“The sum effect of all these is that, a lawyer is now more duty bound than ever before to take all steps necessary to have a client’s case resolved within a reasonable time and at less costs. That duty is imposed by the lawyers Professional Conduct Rules 1989 and the relevant and applicable legislation which includes the relevant provisions of the National Court Act and the ADR Rules that were enacted thereunder. Unless a case falls in the category of questions or cases inappropriate for resolution by ADR and or mediation, lawyers are bound both by their professional conduct rules as well as the relevant legislation and the various judicial pronouncements from both the Supreme and National Courts to take all steps necessary to resolve their client’s cases more readily out of court. A lawyer who fails in his or her duty without good reason would be guilty of misconduct as a lawyer and undoubtedly attract unto oneself, personal liability for costs and interests unnecessarily forced on the client by their conduct.”


  1. The questions stated at [18] of the decision in Able Construction v. WR Carpenter, have now been adopted and incorporated into the new ADR Rules 2022 by Order 2, Rule 2 (3) (b).
  2. It should follow therefore that, unless a case, and in particular in a judicial review matter which concerns an administrative decision and not a court decision, presents an issue of the type listed in paragraph 18 of the decision in Able Construction Ltd v. W.R. Carpenter and Order 2, Rule 2 (3) (b)m of the ADR Rules 2022, they are ideal for resolution by the parties through their own direct negotiations or choices and failing that, by mediation or such other forms of facilitated settlement. The lawyers should be the first in line to encourage their respective clients to have the matter resolved. Consistent with their Professional Conduct Rules the ADR Rules 2022, they have a duty to assist the parties to resolve their dispute rather than insisting on litigation. This is necessitated by the fact that a Court in a judicial review proceeding can only determine whether due process and procedure has been followed by a decision maker to arrive at his or her decision but not the correctness or otherwise of the decision itself. The decision of the Supreme Court in Kalinoe v. Paul Paraka Lawyers (2014) SC1366 is directly on point. Thee the Court at [43] stated:

“...This issue requires a consideration and appreciation of the true nature of judicial review. ... we note that, judicial review concerns only the decision making process of a public authority and not the decision itself. As such, the Court can only either affirm the decision, the subject of the review or, quash the decision in part or in whole by way of correcting an error, abuse or unreasonableness, or the decision making authority exceeding has exceeded its powers. The Court cannot make any decision that substitutes or arrives at a new decision from the decision, the subject of the review, for that belongs to the authority whose decision is under review....”


  1. Hence, a successful judicial review application would see the substantive matter left to be dealt with by the decision maker in accordance with the prescribed process and procedure. That may not fully resolve the issues between the parties. If a decision maker agrees or decides at any stage of the proceeding to retract, review, or otherwise revisit his or her decision which is the subject of a judicial review application, that should be readily permitted.
  2. This leads us to the second additional factor. Appropriate and timely administrative decisions by the executive arm of the government is necessary for the good order, smooth, efficient, and effective functioning of public administration by the executive arm of government. Litigation through the judicial review process puts a brake on that. It is a given fact in our jurisdiction that, such proceedings, like other matters before the courts, sometimes takes years to reach finality. Given the importance of an efficient and effective public administration, the courts when dealing with judicial review matters, must never lose sight of the principles that underpin the doctrine of separation of powers. This doctrine for good reason requires the three arms of government, namely, parliament, the executive, and the judicial arms be kept separate and be respected by each of them. An important part of the doctrine is for their respective actions not to encroach upon each other’s respective functions.[11] Time and again both the National and Supreme Courts have on numerous occasions reaffirmed this principle.[12] As the various decisions of both courts pointed out, there are checks and balances that are expressly stipulated in the Constitution and other legislation to limit the exercise of power of the three arms of government. All arms without any exception are required to act within their defined parameters. Judicial review is the only process whereby the judicial arm is empowered to review the administrative decisions of the executive arm of government. When an administrative decision maker faced with a judicial review application, concedes, and is prepared to do what is required to resolve the issue, the judiciary’s duty it should be to respect such acceptance of responsibility and allow the decision maker to resolve the matter. The same goes for a plaintiff who brings a judicial review application in which the decision maker concedes and is prepared to resolve or fix the problem presented in the judicial review application rather than insist and press on the litigation path. A plaintiff will of course, have the right to return to the Court if the decision maker’s subsequent decision fails to resolve the matter in controversy and there are good grounds for judicial review. Hence, the plaintiff does not miss out on anything save only for costs which can be easily taken care of by an appropriate order. In the light of all these, a party insisting on litigation should not be permitted.
  3. Finally, judicial time and resources are very scarce. The Lord Wolf Report on Access to Justice,[13] formed the basis in the United Kingdom (UK), the home of common law and our system of justice for a much-needed reform to civil practice and procedure to take place. This change emphasises the need for a judge or court and not the parties to appropriately manage and allocation these limited resources or ration them to enable the judiciary to expeditiously dispose of all cases that come into the court system at less costs and time taken for the parties and the judiciary. Included in the reforms is the notion that these scarce resources need to be used to hear and dispose of matters in which there are a real controversies that is beyond the parties’ resolution. In a case where one party concedes to the other’s claim, no controversy warranting more judicial time than that which is necessary to make the appropriate orders to finalise the proceeding is presented. Other than making any such orders and determining the issue of costs, if that is an issue between the parties, the court would be deprived of any jurisdiction to deal with the matter and make any other decision. No plaintiff has any right to insist on litigating a matter further, once a defendant to a claim concedes and is willing to remedy the problem that has landed the parties in court at the first place. The courts have in other situations unfavourably viewed parties failing to meaningfully engage in settlement negotiations and have visited them with appropriate judgment and orders. In my decision in Wantok Gaming Systems Ltd v. National Gaming Control Board (2014) N5809, I summarised the position in these terms at [9]:

“... in the Hargy Oil Palm and later the Able Construction, Koitaki Plantations and Alex Awesa cases that, the Courts were not favourably viewing parties who fail to use mediation in good faith to resolve their disputes. Further, I noted that, the Courts were taking that position because of the objectives behind the introduction and promotion of mediation as well as its benefits...With reference to my decision in PNG Ports Corporation Ltd v. Canopus No 71 Ltd,... I went on to observe that, the Courts were repeatedly making it clear that, ‘almost all disputes that enter the Court are capable of settlement, by the parties’ direct negotiations.’ In so doing, I noted that, the Supreme Court in its decision in Public Officers Superannuation Fund Board v. Sailas Imanakuan .. had already made that observation and highlighted the fact that, the ‘Courts are there only to help resolve or determine disputes that cannot be resolved by the parties themselves despite their best endeavours to do so.’ Finally, I noted ... [and] as high as (sic) the Supreme Court in PNG, in NCDC v. Yama Security Services Pty Ltd,...the Courts were repeatedly calling for more use of mediation. Finally, I noted that, in PNG, in 2008, Parliament endorsed the Courts call by amending the National Court Act. The new provisions in the Act allow for Court Annexed ADR with more emphasis on mediation and empowered the Judges by s. 7E to promulgate rules to make a system of court annexed mediation work. The Judges appropriately responded on 30th March 2010, when they promulgated the ADR Rules.”


  1. Although these observations were in the context parties failing to comply with orders for mediation and have their disputes resolved, they equally apply generally to parties failing to meaningful engage in settlement negotiations. My decision in PNG Ports Corporation Ltd v. Canopus No 71 Ltd (2010) N4288 (reference in the above passage) is a case on point. Subsequent decisions of the National and Supreme Court such as the Supreme Court’s decision in Bluewater International Ltd v. Mumu (2019) SC1798, have approved the principles enunciated in these judgments.

Summary and decision


  1. Based on the foregoing reasons, I find the provisions of s. 35 of the Interpretation Act applies to the Oil and Gas Act and hence this case. Additionally, the doctrine of functus officio cannot be allowed to override the clear legislative provisions of s.35 of the Interpretation Act or any other without any expressed statutory provision allowing for its application. Further, consistent with present case management practices and procedure, the doctrine of functus officio does not apply to cases in which a party to a proceeding concedes to the other’s claim and is willing to do what is required to correct that which landed the parties in court at the first place. Furthermore, where a decision maker in an administrative case whose decision is the subject of a judicial review proceeding concedes and retracts the relevant decision and effectively grants the reliefs sought in the application the doctrine of functus officio does not apply. In these circumstances, the plaintiff in the present case, cannot and does not have the right to insist on litigation and maintain OS (JR) 18 of 2022 after having filed OS (JR) 56 of 2022 against the Minister’s Second Decision. To do so amounts to an abuse of process as discussed and applied in the Telikom PNG Ltd v Independent Consumer and Competition Commission (2008) SC906 and the National Court decision leading to that decision, Telikom PNG Ltd v Independent Consumer and Competition Commission (2007) N3143.
  2. Applying the above to the case at hand, I find the Minister was entitled and was empowered to retract his First Decision and have it replaced by his Second Decision. His empowerment came from s. 35 of the Interpretation Act and the law generally in the absence of any clear legislative provision precluding him from doing so. Consequently, I find the Minister’s Second Decision resolved OS (JR) 18 of 2022, by reason of which the Plaintiffs should have withdrawn and discontinued those proceedings but have failed to do so, which amounts to an abuse of process. Accordingly, I order a dismissal of OS (JR) 18 of 2022. This will leave the Plaintiffs to pursue OS (JR) 56 of 2022. I will reserve on the question of costs of the now dismissed proceedings and any consequential issues to be picked under OS (JR) 56 of 2022.
  3. OS (JR) 56 of 2022 is now listed for directions hearing on 17 May 2023 at 3:00pm. Parties to come fully prepared with draft consent orders for an expedited hearing and conclusion of those proceedings.

___________________________________________________________________
Denton Lawyers: Lawyers for the all the Plaintiffs
Solicitor General: Lawyers for the Second Defendant
Holingu Lawyers: Lawyers for the First and Fourth Defendants
Gileng & Co. Lawyers Lawyers for the Third Defendant



[1] Rest of the quotations and or reference in this judgment will be from Collier J’s judgement with their honours agreeing.
[2] See The State v. Tamate & Ors (2021) SC2132 at [166] per Makail J with whom I agreed.
[3] See Haiveta v. Wingti & Ors [1994] PNGLR 197, per Jalina J with Kapi DCJ and Salika J (as they then were) agreeing.
[4] See for example Avona v. The State [1986] PNGLR 148, per Kidu CJ, Amet, Cory, Los and Wilson JJ
[5] See [16] and [18] of the judgment.
[6] See Tindiwi & Ors v. Nilkare, Minister for Provincial Affairs, and The State [1984] PNGLR 191, per Bredmeyer J with Amet J agreeing.
[7] Similar decisions were arrived at in Nelson v. Pruaitch, Minister for Forests (2003) N2440, per Sevua J and in Nuia v. Sabumei [1992] PNGLR 90, per Los J.
[8] See the decision of the Supreme Court in Bluewater International Ltd v. Mumu (2019) SC1798.
[9] See for examples of cases on point: Hargy Oil Palm Ltd v. Ewasse Landowners Association Incorporated (2013) N5441; Alex Awesa & Anor v. PNG Power Limited (2014) N5708; Wantok Gaming Systems Ltd v. National Gaming Control Board (2014) N5809; Meckpi v. Fallon (2017) N6708.
[10] See: PNG Ports Corporation Ltd v. Canopus No 71 Ltd (2010) N4288; Hargy Oil Palm Ltd v. Ewasse Landowners Association Inc (2013) N5441; Alex Awesa v. PNG Power Limited (2014) N5708; Able Construction Ltd v. W.R. Carpenter (PNG) Ltd (2014) N5636 and Robmos Ltd v. Fredrick M Punangi (2017) N6585, to name a few.
[11] See Re Internal Security Act; Reference by the Ombudsman Commission [1994] PNGLR 341.
[12] See for example the decision in Reference by the Ombudsman Commission Pursuant to Constitution, Section 19(1), Re Public Money Management Regularisation Act 2017 (2020) SC1944.
[13] Copy found at https://webarchive.nationalarchives.gov.uk/ukgwa/20060213223540/http://www.dca.gov.uk/civil/final/contents.htm


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