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Niusky Pacific Ltd v National Housing Corporation [2024] PGNC 437; N11111 (6 December 2024)

N11111

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]


OS NO. 745 OF 2014


BETWEEN
NIUSKY PACIFIC LIMITED formerly PAPUA NEW GUINEA AIR SERVICES LTD
First Plaintiff


AND
NATIONAL AIRPORTS CORPORATION LIMITED
Second Plaintiff


AND
WILSON MAVOKO
Third Plaintiff


AND
NATIONAL HOUSING CORPORATION
First Defendant


AND
SIKE TOULIK, PATRICK MAIYAU, JOHN PAUL, ANTHONY SIMITAP, HAGAGI ZERIGA & Others named in the Schedule attached to Order of 6 October 2017
Second Defendants


Waigani: Makail, J
2023: 13th September
2024: 6th December


PRACTICE & PROCEDURE – Expediated hearing – Point of law –Construction of statutory provision – Question of ownership of assets – Assets of Civil Aviation Authority – State aviation enterprise – Assets comprised of residential houses and institutional houses – Civil Aviation Act, 2000 – Sections 324A and 324B


STATUTORY INTERPRETATION – WORDS & PHRASES – Succession – Succeed – Meaning of – Civil Aviation Act, 2000 – Section 324A


Cases Cited:
National Housing Corporation v Papua New Guinea Air Services Limited, National Airport Corporation, Sike Toulick, Patrick Maiyau & Ors: SCA No 163 of 2015 (Unnumbered & Unreported Judgment of 2 September 2016 per Injia CJ, Collier & Poole JJ)


Counsel:
Mr N Kopunye, for the First Plaintiff
Ms B Poki, for the Second Plaintiff
Mr G Akia, for the Third Plaintiff
No appearance, for the First Defendant
Mr N Kubak with Ms G Kubak, for the Second Defendants


INTERLOCUTORY RULING


6th December 2024


  1. MAKAIL J: This matter was fixed for an expediated hearing on a

point of law. It is on the construction of Section 324A of the Civil Aviation Act, 2000 (as amended) (“CA Act”). There are two further issues covered in the ruling.


Introduction


  1. The question which falls for determination is whether Section 324A confers ownership of assets comprising of houses and residences to the first and second plaintiffs.
  2. This question requires a resolution because there is a dispute between the following parties:

Background Facts


  1. The background of the dispute is as follows:

Law


  1. Section 324A of the CA Act states:

“324A. SUCCESSION OF CERTAIN ASSETS AND LIABILITIES OF CIVIL AVIATION AUTHORITY BY CASA, PNG ASL AND NAC.


(1) As from the date declared by the Minister in the National Gazette, CASA, PNG ASL and NAC succeed to all of the assets and liabilities of the Civil Authority, to the extent that such assets and liabilities relate to the objects and functions of CASA, PNG ASL and NAC as set out in Sections 11, 12, 16, 143, 144, 145, 146, 147, 147A, 147B, 147C and 147D in the same capacity as such assets and liabilities were vested in the Civil Aviation Authority.


(2) Without limiting subsection (1) -


(a) All assets and rights and all management and control of anything (including as trustee) which, immediately prior to the succession date were vested, payable to, recoverable by, or which belong to the Civil Aviation authority are, as from the date of declared by the Minister by notice in the National Gazette transferred to, recoverable by and belong to CASA, PNG ASL or NAC as the case may be, to the extent that such assets, rights, management or control relate to the object and functions of CASA, PNG ASL or NAC set out at Sections 11, 12, 16, 143, 144, 145, 146, 147, 147A, 147B, 147C and 147D without any transfer, assignment, notice or assurance other than by this Act and despite any other Act or law; and


(b) all suits, actions and proceedings commenced and pending immediately prior to the succession date by or against the Civil Aviation Authority are, as from the date declared by the Minister by notice in the National Gazette, to be taken to be pending and may be accrued on and prosecuted by or against CASA, PNG ASL, or NAC, to the extent that such assets, rights, management or control relate to the objects and functions of CASA, PNG ASL or NAC as set out in Sections 11, 12, 16, 143, 144, 145, 146, 147, 147A, 147B, 147C and 147D and no such suit, action or proceeding is abated or prejudicially affected by this Act; and


(c) all contracts (including for employment), deeds, or other instruments (written or otherwise) entered into by or with the Civil Aviation Authority and in force immediately prior to the date declared by the Minister by the notice in the National Gazette are, as from the date declared by the Minister by notice in the National Gazette, to be taken to be contracts, deeds or other instruments entered into by or with CASA, PNG ASL or NAC, to the extent that such contracts, deeds, or instruments relate to the objects and functions of CASA, PNGASL or NAC as set out in Sections 11, 12, 16, 143, 144, 145, 146, 147, 147A, 147B, 147C and 147D and;


(d) all State appropriations in the name or for the benefit of the Civil Aviation Authority shall, as from the date declared by the Minister by notice in the National Gazette, accrue to, and be for the benefit of CASA, PNG ASL and NAC, to the extent that such appropriations relate to the objects and functions of CASA, PNG ASL and NAC as set out in Sections 11, 12, 16, 143, 144, 145, 146, 147, 147A, 147B, 147C and 147D.


(e) CASA, PNG ASL and NAC are, as from the date declared by the Minister in the National Gazette, to be taken to be operated independently with their own individual boards.” (Underlining added).


Construction of Section 324A of CA Act


  1. Mr Kopunye of counsel for the first plaintiff argued that because of the words “succession” and “succeed” used in Section 324A, it means that ownership of the assets is conferred on the plaintiffs and CASA. This interpretation is reinforced by the plain English definition of the word “succession” in the Oxford Advance Learners Dictionary as “The action, process or right succeeding to a title, property etc.”
  2. Counsel further argued that given this definition, assets (and liabilities) of CAA (when CAA was abolished in 2010 by amendment to CA Act) were succeeded to by CASA, PNG ASL and NAC in accordance with their respective functions and objectives. However, Mr Kopunye further argued that for the succession to be completed or that for CASA, PNG ASL and NAC to succeed to all the assets (and liabilities) of CAA, the relevant Minister must publish a Notice of Declaration in the National Gazette of the succession.
  3. In this case, the relevant Minister published a Notice of Declaration of the date of succession dated 28 January 2016 and declared 1 February 2016 as the date of succession whereby all assets (and liabilities) of CAA were succeeded to by CASA, PNG ASL and NAC to the extent that such assets (and liabilities) concerned their respective objectives and functions. It follows that as from 1 February 2016 onwards, all assets (and liabilities) formerly belonging to CAA now belonged to the three respective entities.
  4. Against Mr Kopunye’s arguments is Mr Kubak’s strong submissions that Section 324A is contrary to the NEC Decision 1992 because it has the effect of displacing the tenants of the houses and residences which were once under CAA. This is because pursuant to the NEC Decision 1992, the first defendant disposed of Detached Low Costs Houses to sitting tenants and sold Institutional Houses not on Institutional Grounds to current tenants.
  5. Mr Kubak reinforced his submissions by relying on the affidavit of Mr Samuel Geno sworn on 27 May 2019 and filed 28 May 2019. I must say that Mr Geno’s affidavit is quite lengthy and outlines the background of the administration of the houses and residential properties during the reforms under the Department of Civil Aviation to CAA and eventually the first and second plaintiffs and CASA.
  6. Mr Kopunye countered these submissions by arguing that the NEC Decision 1992 has no application after the relevant Minister published the Notice of Declaration in the National Gazette under Section 324A because Section 324A is a provision of the CA Act and CA Act being a statute, takes precedence over a policy decision of the NEC.
  7. On a plain reading of Section 324A, I accept Mr Kopunye’s argument that Section 324A conferred ownership of assets on the plaintiffs and CASA for the reasons outlined at [6] above. Given this interpretation, assets (and liabilities) of CAA (when CAA was abolished in 2010 by amendment to CA Act) were succeeded to by CASA, PNG ASL and NAC in accordance with their respective functions and objectives. Moreover, to give effect to Section 324A or for succession to be completed or that for CASA, PNG ASL and NAC to succeed to all the assets (and liabilities) of CAA, the relevant Minister must publish a Notice of Declaration in the National Gazette of the succession.
  8. Reading Section 324A as conferring ownership of assets on the first and second plaintiffs and CASA on the publication of a Notice of Declaration in the National Gazette by the relevant Minister is further reinforced by Section 324B of the CA Act which states:

“Despite any other provisions of this Act, CASA, PNG ASL and NAC have all the powers, authorities, duties and functions in relation to asset, liabilities and other matters and things to which they succeed under this Part as the Civil Aviation Authority had (in any capacity) immediately prior to the date declared by the Minister by notice in the National Gazette.”


  1. In the present case, the relevant Minister published a Notice of Declaration of the date of succession dated 28 January 2016 and declared 1 February 2016 as the date of succession whereby all assets (and liabilities) of CAA were succeeded to by CASA, PNG ASL and NAC to the extent that such assets (and liabilities) concerned their respective functions and objectives. It follows that as from 1 February 2016 onwards, all assets (and liabilities) formerly belonging to CAA now belonged to the three respective entities.
  2. Applying this interpretation to the present case, I uphold Mr Kubak’s submissions to the extent that the NEC Decision 1992 applied to the tenants of houses and Institutional Houses not on Institutional Grounds to the date immediately before the date of the Notice of Declaration published by the relevant Minister of 1 February 2016. In other words, any house and Institutional House not on Institutional Grounds sold by the first defendant to the tenants prior to 1 February 2016 pursuant to the NEC Decision 1992 does not form part of the assets of the plaintiffs and CASA.
  3. This view is further reinforced by Mr Geno in his affidavit where it is undoubtedly accepted that he is well versed with the background of these reforms having been instrumental in putting in place the policy submissions that went to the NEC to approve for implementation.
  4. Appropriate findings of fact based on what Mr Geno has outlined in his affidavit will be made after all evidence have been received but it is sufficient to note that the assertions at paragraphs 14, 15 and 16 of the affidavits that pursuant to NEC Decision 1982, the houses and residences being declared as Civil Aviation Institutional Housing fell under the responsibility of the Director of Civil Aviation to allocate while the administration responsibilities were given to the Department of Urban Development, that no land titles of the houses and residences were sighted and some of the houses and residences were allocated to Departmental staff of Civil Aviation and Department of Urban Development administered and managed these houses and residences according to the Tenancy Agreements.
  5. From 1 February 2016 onwards, this is where I accept Mr Kopunye’s submissions that pursuant to the Notice of Declaration published by the relevant Minister in the National Gazette under Section 324A, Section 324A being an amendment (addition) to the CA Act and the CA Act being a statute takes precedence over the policy decision of the NEC in its Decision 1992. It follows that the houses and Institutional Houses not on Institutional Grounds and not sold prior to 1 February 2016 are not covered by the NEC Decision 1992. These houses and Institutional Houses passed on succession to either the first and second plaintiffs or CASA in accordance with their respective functions and objectives.
  6. For the foregoing reasons, I make the following findings:

Vesting of Land


  1. The next question is whether houses and Institutional Houses on Institutional Grounds belong to the first and second plaintiffs and CASA.
  2. Mr Kopunye argued that the first and second plaintiffs and CASA are State Aviation Enterprises because they manage aviation operations for the State. In the discharge of their respective operational functions, they are required to operate facilities such as airports, terminals, hangers and warehouses and provide houses to accommodate their staff etc around the country.
  3. Mr Kopunye further argued that as on 18 January 2008 the Minister for Civil Aviation published a Notice of Vesting in the National Gazette No. G9 of 2008 under Section 332(1)(b)(iii) of the CA Act, land that is vested in CAA ceased to be the subject of the Land Act, 1996.
  4. Counsel further argued that those land vested in CAA are also subject to Sections 324A and 324B of the CA Act. They are succeeded to by the plaintiffs and CASA pursuant to the Notice of Declaration of 1 February 2016.
  5. Relevantly, Section 332 of the CA Act states:

“332. TRANSFER OF LAND


(1) Notwithstanding any other provision of this Act, land within the meaning of the Land Act 1996 and any lands of the State other than lands registered under the Land Registration Act (Chapter 191) that are to be transferred to state aviation enterprise pursuant to this Act shall:


(a) be identified by an adequate legal description, or on plans lodged in the office of the Registrar of Titles (being plans certified as correct for the purposes of this section by the Surveyor-General); and


(b) vest in the state aviation enterprise:


(i) pursuant to and on a date specified in an order; or


(ii) made for the purposes of this section by the Head of State, acting on advice; or


(iii) pursuant to and on a date specified in a notice in the National Gazette given for the purposes of this section by the Minister.


(2) Every notice given under Sub-section (1)(b)(ii) may be given on such terms and conditions as the Minister, thinks fit, and shall have effect according to its tenor.


(3) All land that is subject to the Land Act 1996 and that is transferred to a state aviation enterprise pursuant to this Act shall cease to be subject to the Land Act 1996 as the case may be, from the date of that transfer unless otherwise expressly provided by this Act or any other Act.


(4) Subject to Subsection (5), all land:


(a) designated as an aerodrome by the Minister of Lands under Section 54 of the Land Act 1996 and its predecessors; or


(b) used as an aerodrome for the aerodromes listed in Schedule 1; or


(c) gazetted for aerodrome purposes, being one of the aerodromes listed in Schedule 1; or


(d) designated for public purposes associated with civil aviation,


whether currently used as ab aerodrome or for civil aviation purposes or not, may be transferred to the Authority, or PNG ATS, or an airport authority or an airport company or a province on such terms and conditions as determined by the Minister pursuant to and on a date specified in a notice in the National Gazette given for the purposes of this section.


(5) Nothing in Subsection (4) shall permit the Minister to transfer:


(a) the land, or any part of it, making up the aerodrome listed in Part 1 of Schedule 1 (being Jacksons Airport) to any person other than the Authority or an airport company wholly owned by the State; or

(b) the land, or any part of it, making up any of the aerodromes listed in Part 2 of Schedule of to any person other than either the Authority or an airport established by the province within which the aerodrome is located.” (Underlining added).

  1. The second defendants countered these arguments by relying on three grounds:

(a) these residential properties are outside the aerodrome land.


(b) Section 332(1) of the CA Act is ultra vires Section 4 of the Land Act, 1996.


(c) There are no title documents over the residential properties held by the CAA which would form the basis of the succession to the first and second plaintiffs.


  1. As to the ground that these residential properties are outside the aerodrome land, it will be a matter for further consideration when all evidence have been received.
  2. As to the ground that there are no title documents for the residential properties (houses) held by the CAA to form the basis of the succession to the first and second plaintiffs, again it will be a matter for further consideration when all evidence have been received.
  3. Also, it was one of the issues pointed out by the Supreme Court when pointing out the difference between the words, “title” and “assets” in National Housing Corporation v Papua New Guinea Air Services Limited, National Airport Corporation, Sike Toulick, Patrick Maiyau & Ors: SCA No 163 of 2015 (Unnumbered & Unreported Judgment of 2 September 2016 per Injia CJ, Collier & Poole JJ) where their Honours observed:

“Second, the first and second respondents sought declarations of “title” pursuant to section 324A of the CA Act. “Title” is not a term used in section 324A(1). Rather the section speaks in terms of “assets and liabilities of the Civil Aviation Authority”. It also qualifies the entitlement of the first and second respondents and CASA to succeed to all of the assets and liabilities of the CAA as referrable “to the extent that such assets and liabilities relate to the objects and functions of CASA, PNG ASL and NAC as set out in Sections 11, 12, 16, 143, 144, 145, 146, 147, 147A, 147B, 147C and 147D, in the same capacity as such assets and liabilities were vested in the Civil Aviation Authority”. This qualification is reflected in section 324A(2)(a) of the CA Act. There is no material to support a finding that the primary Judge gave consideration to the complexity of issues raised by the application of section 324A, and whether the relief sought by the first and second respondents was actually congruent with the terms of the legislation upon which they relied.”


  1. As to the ground that Section 332(1) of the CA Act is ultra vires Section 4 of the Land Act 1996, the short answer is, no. This is because Section 4 recognises the two types of land in the land tenure system in Papua New Guinea, one being State land and the other, customary land by reinforcing that all land in the country other than customary is the property of the State.
  2. Section 4 states:

“4. NATIONAL TITLE TO LAND


(1) All land in the country other than customary land is the property of the State, subject to any estates, rights, titles, or interests in force under any law.


(2) All estate, right, title and interest other than customary rights in land at any time held by a person are held under the State.”

  1. On the other hand, on a plain reading of Section 332(1)(b)(iii) of the CA Act, it means that land within the meaning of the Land Act, 1996 and any lands of the State other than lands registered under the Land Registration Act Chapter 191 may be transferred to a state aviation enterprise pursuant to the CA Act. However, before the land is transferred to a state aviation enterprise, there are two requirements that must be satisfied:

(a) the land must be identified by an adequate legal description, or on plans, such plans must be certified as correct for the purposes of Section 332 by the Surveyor-General and lodged in the office of the Registrar of Titles.


(b) the land is vested in the state aviation enterprise pursuant to and on a date specified in a notice in the National Gazette by the Minister.


  1. In the present case, Mr Kopunye did not submit that the first and second plaintiffs complied with the first requirement, and I do not know if the first and second plaintiffs and CASA have satisfied the first requirement that lands subject of the proceedings were properly identified by legal description. This must be further investigated.
  2. However, I agree with Mr Kopunye’s submissions that when the Minister for Civil Aviation published the Notice of Vesting in the National Gazette No. G9 of 2008 under Section 332(1)(b)(iii) of the CA Act on 18 January 2008, land that is vested in CAA ceased to be the subject of the Land Act, 1996.
  3. I also agree that those lands vested in CAA are also subject to Sections 324A and 324B of the CA Act. They are succeeded to be the first and second plaintiffs and CASA pursuant to the Notice of Declaration of 1 February 2016.

Aerodromes


  1. The next question is whether houses located within an aerodrome land belonged to the first and second plaintiffs and CASA.
  2. Mr Kopunye argued that pursuant to two declarations of land as aerodromes, land declared as aerodrome are not subject to the Land Act, 1996. They are subject to the Aerodrome (Business Concession) Act (“ABC Act”). The two declarations are:

(a) 2 June 1980 and published in National Gazette No. 51 on 26 June 1980; and


(b) 9 April 2010 and published in National Gazette No. G17 on 13 April 2010.


  1. It must be observed that the issue under consideration is one of land occupied by the first and second plaintiffs and CASA. As noted from the above facts the 2 June 1980 Declaration was made by the Minister for Lands, Mr Thomas Kavali and was a declaration of Port Moresby (Jacksons Aerodrome) which preceded various declarations that came after. I can accept that the 2 June 1980 Declaration was made under the old Land Act.
  2. Then on 9 April 2010 the then Delegate of the relevant Minister made a Declaration of Land as Aerodrome and published it in National Gazette No. G17 on 13 April 2010. That Declaration was made under the Land Act, 1996.
  3. Relevantly, Section 54 of the Land Act, 1996 states:

“54. Declarations of Land as Aerodromes


1. The Minister may, by notice in the National Gazette, declare an area of land to be an aerodrome.


2. The provisions of this Act shall not apply to land the subject of a declaration under subsection (1) but rather the Aerodrome (Business Concession) Act (chapter 354) shall apply to a lease in respect of such land or any part of such land.”


  1. According to Section 54, the Minister may, by notice in the National Gazette, declare an area of land to be an aerodrome and the consequence of that is the provision of the Land Act, 1996 will not apply to land the subject of a declaration but rather the ABC Act.
  2. Mr Kopunye argued that those lands that are declared aerodrome under Section 54 of the Land Act 1996 are also subject to Sections 324A and 324B of the CA Act. It follows that they are succeeded to by the first and second plaintiffs and CASA as of 1 February 2016 pursuant to the Notice of Declaration of date of succession dated 28 January 2016.
  3. Counsel referred to Section 3 of the ABC Act which provides that “Except as provided in this Act, the Land Act 1996 does not apply to a lease or licence granted under this Act” and argued that as land declared as aerodrome is not subject to the Land Act, 1996, it effectively means that State Leases under the Land Act 1996 cannot be granted for land situated with an aerodrome.
  4. It follows that houses or residential properties under State Leases in an area of land declared as aerodrome fall under the administration of the CAA under the ABC Act and were succeeded to by the first and second plaintiffs and CASA as of 1 February 2016. In other words, the first defendant is not authorized by law to administer, grant leases or licences within an aerodrome land.
  5. Mr Kubak maintained his submissions that NEC Decision 1992 authorised the first defendant sell houses and Institutional Houses to the tenants. However, I accept Mr Kopunye’s submissions based on the reasons he has articulated. Mr Kopunye’s submissions that State Leases within an aerodrome land fall within the administration of the CAA and now the three named entities are reinforced by Section 1 of the CA Act which defined an “aerodrome” as:

“(a) any defined area of land or water intended or designated to be used either wholly or partly for the landing, departure, movement and serving of aircraft.


(b) any buildings, installations and equipment on or adjacent to any such area used in connection with the aerodrome or its administration.”


  1. In my view, the terminology “any buildings” used in Section 1(b) is wide enough to include houses or residential properties within an aerodrome land. Adopting this interpretation further supports the operational requirements of the first and second plaintiffs and CASA and the purpose of the CA Act set out in Section 1.
  2. As Mr Kopunye has articulated in his submissions above, as State Aviation Enterprises, the first plaintiff, second plaintiff and CASA manage aviation operations for the State. In the discharge of their respective functions, they are required to operate facilities such as airports, terminals, hangers, warehouses and housing for their respective staff etc around the country. Having houses or residential properties in an aerodrome land in proximity to these operational facilities is not only convenient but safe and accessible with minutes by the staff. The result, the travelling public are not inconvenienced by the lateness or absence of the staff.
  3. I conclude that any house or residential property in an aerodrome land falls under the responsibility of the CAA and passed from CAA to the three named entities. Further, evidence of title is relevant as proof that title to the house or residential property has passed to the three named entities.

Summary


  1. I make the following findings of law:

(a) any house or residential property not on Institutional Grounds may be sold to the tenant.


(b) “Institutional Grounds” is land that vests in the CAA and passed to the three named entities.


(c) evidence of title is relevant as proof that, title to the house or residential property has passed from the CAA or now the three named entities to the tenant.


(d) any house or residential property on Institutional Grounds vests in the CAA and passed from the CAA to the three named entities.


(e) evidence of title is relevant as proof that, title to the house or residential property has passed from the CAA to the three named entities.


(f) any house or residential property on aerodrome land falls under the responsibility of the CAA and passed from the CAA to the three named entities.


(g) evidence of title is relevant as proof that, title to the house or residential property has passed from the CAA to the three named entities.


Conclusion


  1. I direct parties to review the evidence and identify the houses or residential properties which the first and second plaintiffs, CASA, third plaintiff and second defendants assert have interest in terms of title over, based on the criteria at [19] and [48] above and report back to the Court on Tuesday 11 March 2025 at 1:30 pm.

Ruling accordingly


Kopunye Lawyers: Lawyers for First Plaintiff
Warner Shand Lawyers: Lawyers for Second Plaintiff
Akia & Associates Lawyers: Lawyers for Third Plaintiff
In House Counsel: Lawyers for First Defendant
Kubak & Kubak Barristers & Solicitors: Lawyers for Second Defendants

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