Yanta Development Association Inc v Piu Land Group Inc [2005] PGSC 24; SC798 (29 August 2005)

SC798

PAPUA NEW GUINEA

IN THE SUPREME COURT OF JUSTICE

SCM. NO. 6 OF 2004

BETWEEN:

YANTA DEVELOPMENT ASSOCIATION INC.
-First Appellant-

AND:

HENGAMBU LANDOWNERS ASSOCIATION INC.
-Second Appellant-

AND:

TOWANGOLA LAND GROUP INC.
-Third Appellant-

AND:

THOMAS NEN OF BABWAF CLAN
-Fourth Appellant-

AND:

PIU LAND GROUP INC.
-First Respondent-

AND:

SIR MICHAEL SOMARE in his capacity as the MINISTER FOR LANDS AND PHYSICAL PLANNING
-Second Respondent-

AND:

PEPI S KIMAS as SECRETARY, DEPARTMENT OF LANDS AND PHYSICAL PLANNING
-Third Respondent-

AND:

THE INDEPENDENT STATE OF PAPUA NEW GUINEA
-Fourth Respondent-

WAIGANI: KIRRIWOM, J
BATARI, J
MOGISH, J.

2005: 27 June & 29^th August

APPEAL – Equity – Certiorari – Judicial review of Ministerial powers – Equitable jurisdiction of Court to quash ministerial exercise of discretion to revoke grant of lease.

LAND AND LEASES – Application for Lease – Lease Back Lease – Customary land – land required for mining operation – Validity of grant of Lease – Grant of Lease by Delegate of Minister for Lands and Physical Planning – Revocation of grant by subsequent Minister for Lands and Physical Planning.

ADMINISTRATIVE LAW – Application for judicial review – Review of Ministerial powers of revocation – Order for Certiorari – Validity of Order for Certiorari.

PRACTICE AND PROCEDURE – Judicial Review under O.16 National Court Rules – Requirements for service of documents on all persons affected – Mandatory requirements of O.16 Rule 5(2), (4), (5) and (6) and Rule 9 (1) of National Court Rules.

PRACTICE AND PROCEDURE – State Leases – Application for Lease – Lease back Purposes under s.11 and s.102 of Land Act – Compliance with procedural requirement vital.

WORDS & PHRASES - “Persons directly affected” includes persons having direct or indirect interest in a matter subject to dispute that justice requires for him to be served with documents to be heard although not named as a party.

Brief Facts:

The Applicant/First Respondent and the Appellants have a common interest in an area of customary land in the Watut mountains of Mumeng District Morobe Province. The land in question comprises 50,00 hectares of mountainous terrains described as Portion 8C Milinch of Wasus and Fourmil of Markham, Morobe Province. And inside that large area is the Wafi Gold Mine Project about to go into operation. The Wafi Gold Mine Project covers an area of 6240 hectares.

On an application by the First Respondent under ss.11 and 102 of the Land Act for the Wafi Gold Mine Project land area, the delegate of the Minister for Land exercising a delegated power issued a lease under his hand on 26 July 2001 in favour of the First Respondent over the entire Portion of land covering 50,000 hectares.

The issue of ownership of Wafi Gold Mine Project land and those adjacent to it has been subject of bitter disputes amongst various clans and villages in the area in the Local and District Land Courts for over two decades. Customary ownership of Wafi Project Land had been awarded to First and Second Appellants with the Fourth Appellant having an interest in it as well. The Third Appellant was also awarded ownership of the land immediately adjacent but just outside the Project Land and within the general area of 50,000 hectares.

Following complaints and representation to the Minister for Lands and Physical Planning and the Departmental Secretary by and on behalf of the Appellants, the Second Respondent revoked the lease that was granted to the Applicant/First Respondent for failing to comply with the requirement of sections 11 and 102 of the Land Act.

Aggrieved by this revocation the Applicant/First Respondent applied for judicial review of that decision and sought certiorari to bring the decision before the National Court and have it quashed. None of the Appellants were named as parties and no opportunity was given to them either by service of documents on them or by allowing them time to cause appearances and be heard on its application.

The court granted the order for certiorari in an uncontested application and signed the order in the terms prepared by the Applicant’s lawyer.

The Appellants became aware after the judgment had been entered and applied to be joined. National Court dealing with the application found the appellants were ‘persons directly affected’ and needed to have been served with the Summons and Notice of Motion. This view was also confirmed by an earlier Supreme Court decision which allowed the Appellants to join in the proceeding.

The Appellants have filed this appeal or review seeking to declare the decision of the National Court null and void ab initio, following their joinder as Parties to this proceeding.

The issues addressed in the proceeding are:

1. Was the judgment of 18 and 19 August 2004 irregularly entered? If so, then it must be set aside as a matter of law?
2. Did the trial judge err in endorsing the draft order when there was no proper hearing on the application for judicial review?
3. Were the Appellants ‘persons directly affected’ by the decision of the Minister for Land and Physical Planning?
4. Did the Minister have power to revoke the grant of lease to the First Respondent by the Delegate of the Minister for Lands and Physical Planning?
5. Was there a valid title to land passed to the First Respondent under the Lease-Lease back arrangement issued by the Delegate of the Minister?
   

Held, upholding the Appeal:

1. That the judgment entered by the National Court in the absence of the Appellants who were not made parties to the proceeding was irregular and was therefore void and of no effect.
2. That the judge erred in sanctioning or signing the draft consent order or judgment when there was no proper trial or hearing of the application for judicial review.
3. That ‘persons directly affected’ included the Appellants as well as those the First Respondent originally named in the originating process.
4. That the Minister had adequate power under the relevant laws to grant leases as well as to revoke such grants.
5. That no valid title could pass to the First Respondent in respect of the Lease granted by the Delegate of the Minister:
   
   1. for failing to comply with the requirements of the Land Act under s.11 and 102 of the Act; and
   2. for erroneous exercise of power in granting lease over portion of land not specifically applied for to the First Respondent.
      

Cases cited and referred to:
Piu Land Group Inc. v Sir Michael Somare & Ors [2005] Unreported National Court Judgment – O.S. No. 662 of 2003 (23/09/04)
Yanta Development Association Inc & Ors v Piu Land Group Inc & Ors [2005] Unreported Supreme Court Judgment (08/03/05)
Kitogara Holdings Pty Ltd v. National Capital District Interim Commission & Ors. [1988/89] PNGLR 234
Jack Nou on behalf of Hogwaipi Clan of Madai Village v. Richard Cheraka, Magistrate, Provincial Land Court Port Moresby, Dogome Naime [2004] Unreported National Court Judgment (delivered 30^th April 2004) N2539
Leo Hanneth and Elizabeht Hanneth v. ANZ Banking Group [1996] SC505
Anlaby v. Praetorius [1888] UKLawRpKQB 55; (1888) 20 QBD 764
Green and Company Pty Ltd v. Green [1976] PNGLR 73
Smeeton v. Davara House Pty Ltd [1979] PNGLR 324
Page P/L v. Malipu Balakau [1982] PNGLR 140
Bank of South Pacific v. Spencer [1983] PNGLR 239
In the Application of the National Capital District Interim Commission [1987] PNGLR 339

Counsel:
T. Nonggor for the First and Second Appellants
D.L Dotaona for the Third Appellant
T. Manjin for the Fourth Appellant
Dr I Nwokolo for the First Respondent
D. Lambu for the Second, Third and Fourth Respondents

DECISION

29^th August 2005

BY THE COURT:

1. The appeal
   

This is an application for judicial review under s.155(2) (b) of the Constitution pursuant to a direction from the National Court. However, it is also pursued as an appeal by the First and Second Appellants under Order 16 Rule 11 of the National Court Rules by way of Notice of Motion. This unusual process paved way for the parties to file affidavits and allowed the parties to rely on their affidavits as the procedure itself permitted this at the hearing of the appeal. It would have otherwise caused injustice to the parties if strict compliance to ‘rules of fresh evidence’ were applied in this case.

The appeal or application for review is against the decision of the National Court made on 19^th August 2004. The order or judgment appealed is set out below:
“
ORDER OF CERTIORARI

UPON READING the Originating Summons on behalf of the Applicant PIU LAND GROUP INC. dated 18^th May 2004 together with the Statement in Support lodged on the application for leave to issue application for Judicial Review and the Affidavits of Martin Tapei, the Chairman of PIU LAND GROUP INC. and the exhibits therein referred to filed in Support of the notice of Motion; and

AND UPON HEARING DR. Nwokolo of Counsel for the Applicant and Miss Jacqueline Lilih of Counsel for the Respondents the National Court of Justice ordered an order in the nature of Certiorari to bring up and quash the decision of the Minister for Lands and Physical Planning made on the 18^th July 2001 and published in the National Gazette Number G. 96 of 24^th July 2003 revoking the grant of a Special Agricultural and Business Lease to the Applicant.

IT IS ORDERED that the Applicant is declared the leaseholder of Portion 8C, Milinch of Wasus, Fourmil of Markham, Morobe Province pursuant to the grant of 4^th July 2001 and notice gazetted on the 26^th of July 2001 in National Gazette No. G94.

AND IT IS FURTHER ORDERED THAT THE Applicant be issued an instrument of lease of the said Portion described as Portion 8C, Milinch of Wasus of Fourmil of Markham, Morobe Province with further delay.

AND THAT the Respondents pay the Applicant costs of these proceedings.

The time of the entry of this Order be abridged to the date of settlement which shall be forthwith.

ORDERED: the __19^th day of ___August, 2004
ENTERED: the __20^th day of ___August, 2004

BY THE COURT

signed
..................
REGISTRAR”

At the time this order or judgment was made, none of the appellants were made parties to this action and were not even served with any notice of the proceeding. Aggrieved by this action of the First Respondent, the appellants have come to this Court.

2. Background to the case
   

The history of this case begins in the remote mountains of Watut in the Mumeng District of Morobe Province where the mining activities by CRA and other exploration companies have been going on around the proposed Wafi Gold Mine Project area. The area comprises about 6,240 hectares.

All the parties in this appeal come from this area and are either inside the circle where the Wafi Mining Project is or just outside it but still within Portion 8C which comprises the larger area of 50,000 hectares inclusive of the project land.

In recent times the prospect of Wafi Gold Mine Project going into operation soon has caused renewed interest and competition amongst customary inhabitants of the area but the dispute over ownership of the project land and the surrounding areas has been going on for many years. The earliest recorded case is 1982.

Evidence filed for and on behalf of the Appellants clearly show that at one time or another, there have been numerous court cases claiming ownership of different parcels within Portion 8C. The First and Second Appellants are presently the legally and officially recognized 50:50 owners of the Wafi Gold Mine Project land .The land was awarded to the two groups on 7 May 1985 following years of court battles in both Local and Provincial Land Courts. Their interest was confirmed subsequently on review to the National Court by Los, J on 20^th October, 1989. In the lower Watut, Babwaf Clan is the recognized owner of the Magnese land according to a court decision that goes back to 1982. All this parcel of land are however now possessed by the First Respondent through the disputed lease.

The First Respondent is aware of this background of the subject land as it was an unsuccessful party in the land court proceedings. A decade or so later and , led by Martin Tapei, it decided to adopt a different tactic to register the group’s claim on the land, oblivious to the current status of ownership by the First and Second Appellants; hence these proceedings.

1. Delegate of Minister grants Special Lease over 50,000 ha of land in Portion 8C Milinch of Wasus, Fourmil of Markham to the Piu Clan of Watut.
   

On 22^nd February, 2001 the First Respondent applied for a “Business Lease for Mining Project of Wafi Project Land comprising 6,240 ha”. According to the evidence before the court, none of the other groups knew about this move by the Piu Land Group Inc. The application was approved by the then Secretary for Lands and Physical Planning, G. K. Zurenuoc OBE in his capacity as the Delegate of the Minister for Lands and Physical Planning under s.25 of the Ministers (Delegation) Regulations Ch.35.

The lease grant was published in the National Gazette No. G94 on 26^th July 2001 and issued under the hand of the Delegate of the Minister for Lands for a Special Agricultural and Business Lease under ss. 11 & 102 of the Land Act 1996 over the entire Portion 8C Milinch of Wasus, Fourmil of Markham Morobe Province comprising a total of 50,000 ha inclusive of the 6,240 ha of Wafi Gold Mine Project Land that the group applied for initially,. This triggered immediate hostility throughout the area and the Morobe Provincial Administration was inundated with constant protests and pressure by angry and frustrated landowners to resolve the ongoing conflict which continued ceaselessly for two years.

2. Minister Kopaol revokes Special Lease to the Piu Clan
   

On 18^th May 2003 Hon. Robert Kopaol, MP, the then Minister for Lands did intervene and revoked the grant of the controversial lease. Evidence of the pressure and protests that came to bear on the Minister’s action is found in the affidavits filed especially from Morobe Provincial Program Advisor – Lands, Lawrence Billy annexing volumes of documents of protest letters from the Provincial Administrator, landowners, record of previous court proceedings and orders made and maps of the land area in question. Similar affidavit was also deposed to by John Nema, President of the Second Appellant and another affidavit of similar substance was also deposed to by the President of the First Appellant.

From all these representations the Minister acted accordingly by revoking the lease granted to the Piu Land Group Inc and cited non-compliance with the requirements of the Land Act 1996 especially ss.10, 11 and 102, at the time of grant of the lease as the basis for his intervention. The revocation was widely circulated and published both in the media and in the National Gazette.

100. Court Order (Certiorari) quashing Revocation of Lease by Minister Kopaol
     

Not satisfied with the reasons given by the Minister for the revocation and aggrieved by that decision, the First Respondent commenced proceeding in the National Court in Waigani by filing an originating summons on 19^th November 2003 seeking leave to apply for judicial review of the Minister’s decision. Leave was granted on 5^th May 2004 and thereafter the Applicant withdrew instructions earlier given to Manu & Associates Lawyers and instructed Ikennas Lawyers and Notaries to act for it.

On 18^th August, 2004 when the substantive review application came before the National Court, the First Respondent/Applicant and the parties including the Minister and the State were duly represented.

The court was informed that the matter was fairly simple and would be very short. Counsel for the Applicant advised that his client was seeking an order for certiorari to bring up and quash the decision of the Minister for Lands which he submitted wrongly revoked a grant of lease to the Applicant when the Minister clearly lacked jurisdiction to do so. The court was told that the application was unopposed as discussed between the lawyers and this was agreed to by counsel representing the respondents.

The case was then adjourned to the following day with the Applicant’s counsel undertaking to draft appropriate orders. On 19^th August, 2004 only the Applicant’s counsel appeared and handed up the draft order for the judge’s endorsement.

4. Yanta, Hengambu, Towangola and Babwaf Clans Join the Action
   

The Appellants in this case became aware of this case at different stages although none of them took any positive step to join until after the judgment had been obtained. We will discuss this later in detail but the point to make here is the haste with which the judgment itself was pursued and obtained and in turn denied the appellants and other interested landowners opportunity to join in the action. This suited the First Respondent who wanted the hearing without the Appellants’ involvement as they were not specifically named as the tone of the letter from Ikennas to a query from Pryke and Bray Lawyers on behalf of the Second Appellant shows. That letter did not draw any helpful response. If such correspondence could constitute notice for purpose of the Rules under Order 16, it did not give much time to the First Appellant to do anything because within one week and a day on 18^th August 2004 the First Respondent was already in court seeking the order for certiorari. That letter is reproduced later in the judgment.

In September 2004 the First and Second Appellants filed application for judicial review of the decision of the National Court dated 19^th August, 2004 seeking, inter alia, to be joined in the action. The application was heard by the Deputy Chief Justice, Injia, J on 20^th - 22^nd September, 2004 who delivered his decision the next day on 23^rd September 2004. We will be referring to parts of His Honour’s judgment in due course as we are of the view that the answers to the appellants’ concerns as raised in the grounds of appeal have in fact been answered in his judgment. This appeal stems from that decision or direction.

Consequently this appeal by Notice of Motion was filed on 27^th September, 2004 followed by joinder applications of Thomas Nen of Babwaf Clan on 19^th October, 2004 and Towangola Land Group Inc. on 28^th October, 2004. The latter two were joined by the Supreme Court in its decision dated 8^th March 2005. See Yanta Development Association Inc & Ors v Piu Land Group Inc & Ors [2005] Unreported Supreme Court Judgment (08/03/05).

5. Yanta, Hengambu, Towangola and Babwaf Clans seek to Set Aside Certiorari
   

This proceeding is essentially the combined application by all three Appellants or Applicants seeking to quash the decision of the National Court and have the orders set aside. The end result is that, should the dispute persist; let the parties resolve it properly.

3. Grounds of appeal.
   

The grounds of appeal as pleaded in the Notice of Motion are:

1. That the hearing and judgment on 19 August 2004 in this matter is irregular as the First and Second Appellant should have been served with the Notice of Motion for judicial review pursuant to order 16 Rule 5(2) of the National Court Rules as the First and Second appellants are persons directly affected, and the First Respondents did not serve either the First and Second appellants with the Notice of Motion.
   
2. That the hearing and judgment on 19 August 2004 was irregular as an affidavit pursuant to order 16 Rule 5(5) was not filed setting out why the First and Second Appellants were not served with the Notice of Motion for judicial review.
   

100. That the judge erred and the judgment is irregular as he failed to make enquiries so as to be satisfied that all person directly affected by the proceedings were served with the Notice of Motion for judicial review pursuant to order 16 Rule 5(2) of the National Court Rules.
     

4. That the Judge erred as he failed to make enquiries as to whether an affidavit had been filed detailing all the names and addresses of those persons that had been served with the Notice of Motion and the reasons why any person who ought to be served had not been served.
   
5. That the Judge erred as he held the minister had no power to revoke the grant of a special agriculture and business lease to the First Appellant.
   
6. That the Judge erred in that he found that the Minister for Lands had not exercised the power to revoke the grant of a special and agriculture and business lease to the First Appellant lawfully.
   
7. That the Trial Judge erred as he admitted the affidavits of Martin Tapei filed 5 May 2004 and 1 December 2003 respectively when they contained hearsay and inadmissible evidence.
   
8. That the Trial Judge erred as he failed to take into account that notice that evidence was that the application for the business lease filed on behalf of the Piu Land Group Inc. was only for 6,240 hectares whereas the lease was granted over 50,000 hectares.
   
9. That the Judge erred as His Honour made findings in the absence of admissible evidence that the First Respondent was the traditional landowner of the land in question.
   

4. Issues
   

The main issues foreshadowed by the grounds and argued before us can be summarized into these five categories:

1. Was the judgment of 19^th August 2004 irregularly obtained?
   
2. Did the trial judge err in not making appropriate enquiries as required under the Rules before sanctioning the judgment?
   

100. Are the appellants ‘persons or parties directly affected’ by the judgment of the National Court?
     

4. Did the Minister have power to revoke the Special Agricultural and Business Lease previously granted to the First Respondent by another Minister or his Delegate?
   
5. Was the Special Agricultural and Mining Lease granted 24^th July 2001 to the First Respondent over a customary land area comprising 50,000 hectares not specifically applied for by the First Respondent validly issued?
   

We heard submissions from counsel for the Appellants and the First Respondent. We will be addressing their submissions in the body of our opinion or judgment.

For the record we note that the Second, Third and Fourth Respondents are not opposing this appeal. They are acquiescing in this appeal. Their positions are appreciated because in the normal course of events they would be the appellants who really should be defending the Minister’s exercise of power of revocation.

The position taken by the 2^nd, 3^rd and 4^th Respondents places the First Respondent in an impassable position to argue sensibly in defence of the decision of the court granting the certiorari. The best it could do was to take that narrow path down the definition lane of whether the phrase “all persons directly affected” must be extended to cover persons or parties not named in the proceeding that is subject of review. We will be demonstrating in the judgment that the Minister had power to grant lease and similarly had power to revoke it.

It is our considered opinion that the issues in the appeal can be answered in the following dot points which we hereafter elaborate in detail:

4. Firstly, we are of the view that the order of judgment of 19^th August 2004 was irregularly obtained for two basic reasons:(1) there was no proper hearing or trial of the matter (2) in judicial review application there is mandatory requirement for all parties with interest in the matter to be given notice and the court has the obligation to ensure that every one entitled to be heard is given notice.
   
4. Secondly we are of the view that the Appellants were ‘persons directly affected’ by the decision of the Minister for Lands as far as the land in dispute was concerned. As such under Order 16 rule 5(2) and rule 9 of the National Court Rules it was mandatory on the part of the First Respondent to serve them with the summons and notice of motion and be heard.
   
4. Minister had power to revoke the lease granted on 24 July 2001, in the same way he had the power to grant it. It is illogical to expect the Minister to be devoid of power to revoke a decision of his Delegate that was exercised under his delegation if such revocation complies with the law.
   
4. The Special Agricultural and Business Lease granted on 24 July 2001 to the First Respondent was done contrary to the requirements of the Land Act, ss.11 and 102 and is therefore invalid.
   

REASONS

❶ JUDGMENT OF 19^TH AUGUST 2004 WAS IRREGULARLY OBTAINED.

There are basically two reasons supporting the view that the judgment is irregular. The first is that there was no proper hearing conducted before the court resulting in the judgment endorsed by the trial judge.

We have perused the transcripts of the proceeding that clearly show that this case was a judicial review application. The substantive relief sought was for a writ of certiorari to issue in a superior court to bring or have brought before it the decision of the Minister for Lands made 18^th May 2003 that revoked the grant of an Agricultural and Business Lease to the First Respondent previously made on 24^th July 2001 and to have the same quashed.

Leave for judicial review was granted to the First Respondent on 5^th May 2004. The substantive relief sought were, inter alia, for the following:

1. An order in the nature of certiorari to bring up and quash the decision of the Minister for Lands & Physical Planning published in the National gazette No. G96 of 24^th July 2003 revoking the grant of a Special Agricultural and Business Lease to the Applicant;
   
2. A declaration or an order that the Plaintiff/Applicant is the leaseholder of Portion 8C, Milinch of Wasus, Fourmil of Markham, Morobe Province pursuant to notice gazetted on 4^th of July 2001 in the National Gazette No. G94 of 26^th July 2001.
   

The transcripts show that when the matter went before the court, counsel appearing for the Minister, Secretary and the State did not oppose the action and in some way urged by the trial judge for an order by consent, no trial was conducted and at the matter was to be resolved simply by someone drafting an order for the judge to endorse. Applicant’s counsel then drafted the order which was brought before the judge the following day and endorsed.

The order which is the judgment of the court is the subject of this appeal. The judge had a duty to hear the case even if the respondents were not opposing the action. He must have evidence before him to make a ruling or decision. It is not enough to rely on mere assertions by counsel from the bar table as serious mistakes have been made in the past where counsel had misled the court. We have read the judgment by Injia, DCJ delivered on 23^rd September, 2004 following application by the First and Second Appellants seeking orders to join the action. On the conduct of judicial review applications before the court, we do no more than adopt and endorse the comments made by the Deputy Chief Justice in OS.No. 662 of 2003 Piu Land Group Inc. v Michael Somare & Ors [2005] (supra) where he said at p. 120 Appeal Book:

“A judicial review application is special in nature. Once leave is granted, a full and proper hearing, with all interested parties being heard, is necessary before a final decision is made because the Court should independently satisfy itself that the merits of the case warrant the grant of a prerogative writ , notwithstanding the default of a party in failing to attend Court or the position taken by the parties attending the hearing. The Court must independently conduct its own inquiry to see if the decision was properly made. That was not done in the present case.”

The Supreme Court held similar view in Kitogara Holdings Pty Ltd v National Capital District Interim Commission & Ors [1988/89] PNGLR 346 per Kapi Dep CJ (as he then was) when discussing the applicant’s right to appeal being barred by section 14(2) of the Supreme Court Act Ch 37 as it was a consent order said at p.349:

‘In this case, counsel for the appellant has submitted that as this judgment was a consent order, parties do not have a right of appeal. This is prohibited by s 14(2) of the Supreme Court Act (Ch No 37). He further contended that the applicant who was not a party is prevented by the same provision from appealing. This submission was conceded by counsel for the respondents. Concession of counsel is not binding on the court. The court has to make up its own mind on the matter. I indicated to counsel for the appellant that authorities should be relied upon to support his proposition. This is a critical issue on this application. If s 14(2) of the Supreme Court Act does prevent the applicant from appealing, he has no obligation to justify any reasons for not appealing.’

The second reason is that the judgment was likewise irregular in that without a hearing, all those requirements stipulated under Rule 5 (2), (5) and (6) and Rule 9(1) for notice to be given to other affected parties were simply left begging. These were mandatory requirements.

Order 16 Rule 5 is set out in these terms:

“5. Mode of applying for judicial review. (UK. 53/5)

(1) Subject to Sub-rule (2), when leave has been granted to make an application for judicial review, the application shall be made by originating summons to the Court.

(2) The summons must be served on all persons directly affected and where it relates to any proceedings in or before a court and the object of the application is either to compel the court or an officer of the court to do any act in relation to the proceedings or to quash them or any order made in them, the summons must also be served on the clerk or registrar of the court and, where any objection to the conduct of the Judge is to be made, on the Judge.

(3) Unless the court granting leave has otherwise directed, there must be at least 14 days between the service of the summons and the day named in it for the hearing.

(4) The summons must be listed for hearing within 21 days after the grant of leave.

(5) An affidavit giving the names and addresses of, and the places and dates of service on, all persons who have been served with the summons must be filed before the summons is entered for hearing and, if any person who ought to be served under this Rule has not been served, the affidavit must state that fact and the reason for it, and the affidavit shall be before the Court on the hearing of the summons.

(6) If on the hearing of the summons the Court is of opinion that any person who ought, whether under this Rule or otherwise, to have been served has not been served, the Court may adjourn the hearing on such terms (if any) as it may direct in order that the summons may be served on that person.”

The first fundamental requirement under this Rule after leave has been obtained is that all persons directly affected by the subject matter in dispute must be served with the summons and notice of motion. Whether the appellants are persons directly affected by the order of the court is an issue under contention as far as the First Respondent is concerned which we address in the judgment.

The second fundamental requirement is that the service of the notice on the persons directly affected must be done within 14 days of the grant of leave for judicial review. The third requirement although not an issue in this case is that the substantive trial itself must be set for hearing within 21 days from the grant of leave.

There is uncontested evidence that none of the Appellants in this appeal were served with any documents in the National Court proceedings. This is not denied by the First Respondent but with reasons which are discussed in the judgment. The fact that they are all new comers in the case pursuant to subsequent court decisions speaks clearly of their position in the matter.

The fourth fundamental requirement is expressed in Rule 5 (5) which imposes a further obligation upon the Applicant to file an affidavit of service in court setting out the names and addresses of all those persons directly affected by the subject matter in dispute as well as the names and addresses of those who were not served with the documents and the reasons for not serving them and finally at the hearing of the review application, place this affidavit before the court. It is not disputed that no such affidavit was filed in due compliance with the Rules as such there was none to place before the court. This is a clear error.

And the fifth fundamental requirement under this Rule is that the trial judge has the duty to ensure that there is due compliance of this Rule especially as to service on any person whom the court is of the opinion who ought to be served, had been served with the documents. If the court is of the view that service on persons directly affected has not been done and there were others remaining who needed to be served, the court may adjourn the hearing and direct service on those persons. This is stipulated very clearly in sub rule (6) of Rule 5.

There is no evidence before us that the trial judge directed his mind to the provisions of O.16 r.5 (6) at the hearing.

❷ The judge erred in approving the order or judgment dated 19^th August 2004.

His Honour was clearly unfamiliar with the background of the case and had relied solely on counsel’s mere assertions to sign the order. If however he had taken time to acquaint himself with the case thoroughly by reading the file, either on the 18^th or 19^th of August, 2004, he would have discovered that there was more to the case than what the counsel had had him believed which clearly necessitated service of documents on other parties with legitimate interests who needed to be served. Both rr. 5(6) and 9(1) of O.16 are quite specific and are expressed in mandatory terms as follows:

“r.5(6). If on the hearing of the summons the Court is of opinion that any person who ought, whether under this Rule or otherwise, to have been served has not been served, the Court may adjourn the hearing on such terms (if any) as it may direct in order that the summons may be served on that person. (emphasis is ours)

r.9(1). On the hearing of any notice of motion under Rule 5, any person who desires to be heard in opposition to the notice of motion, and appears to the Court to be a proper person to be heard, shall be heard, notwithstanding that he has not been served with the notice of motion.” (emphasis is ours)

Just reading these two provisions in the Rules show clearly that the Court had a role to play but nothing of the sort prescribed therein happened.

We have also taken the liberty to set out the relevant excerpts from the transcript of 18^th August 2004 (at p. 435 of the Appeal Book) which shows clearly what took place or what did not happen:

“HIS HONOUR: ......Counsel, your matter, how long is that going to take do you think? Any ideas?

COUNSEL: I would say maybe one to two hours.

HIS HONOUR: And what it is? I know nothing about it.

COUNSEL: My clients are traditional landowners and they applied for a leaseback of their traditional land and this was granted and gazetted and that was done by the previous Minister. Then the Minister that succeeded that Minister chose to revoke the grant. Now there is nothing in the Land Act that says he has any authority to do that. (emphasis is ours)

HIS HONOUR: To do that?

COUNSEL: That is right. So, what basically it is about is to ask the court to restore the grant. The Minister that revoked it is not the Minister for Lands anymore. Several other ministers have come... (emphasis added)

HIS HONOUR: Come and gone.

COUNSEL: Yes. So, it is a straightforward matter and my learned friend does not seem to be opposing it. That is to say that the revocation was done without the Secretary for Lands being consulted about it and it was done for unknown reason by the Minister. (emphasis added)

HIS HONOUR: Yes, thank you, doctor. I just wanted to get some idea of what it is about. Thank you. Now, State, what is your situation. Are you opposing this application or not?

STATE LAWYER: No, your Honour.

HIS HONOUR: I am sorry. Go on.

STATE LAWYER: My clients are not opposing the application as the Secretary to the Lands Department does not have any powers to revoke the Minister’s decision. So we are only advising the court on the situation how the Minister came about in revoking the applicant’s...

HIS HONOUR: Well, if there is no objection to the application, could someone not draft an order that I can sign? Is that possible?

COUNSEL: As your Honour pleases.

HIS HONOUR: And maybe if we come back tomorrow at 1:30 or something like that.

STATE LAWYER: As the court pleases.

COUNSEL: Thank you your Honour.

HIS HONOUR: Is everyone in agreement to that? Well, that is good. I wish they were all that easy. Very well, we will adjourn the matter to 1:30 tomorrow for mention and in the meantime if an order can be drafted which is agreed to and I will sign it.” (emphasis is ours)

It is clear from this evidence that the Court played no participatory role in seriously trying to understand the nature of the case before even requesting for a draft order. This is a serous irregularity sufficient to have the judgment of the court set aside on this ground alone.

❸ Yanta, Hengambu, Babwaf and Towangola Clans had members who were ‘persons directly affected’ by the action instituted by Piu Land Group Inc.

There are several reasons that support the appellants as parties or persons who are directly affected by the judgment of 19^th August, 2004 and were therefore entitled by law to have been served with the summons and notice of motion. First, it was no secret to the First Respondent and any other group in Morobe Province of the Appellants’ interest in the land that was under dispute. There have been earlier proceedings that we have already referred to going back many years that Piu clan, a comparatively small group to that of Yanta and Hengambu, well know. If Martin Tapei was ignorant of them, he needed to consult the elders or check with the court records before taking the action he took.

There is no doubt in our mind that the First Respondent deliberately proceeded under sections 10 and 102 of the Land Act 1996 to acquire a lease over the land in question when it was known to it that there were court orders in place that did not favour Piu clan. This reasoning is further strengthened by the fact that the First Respondent had earlier commenced proceeding titled O.S. No. 69 of 2003 in Waigani National Court naming the First and Second Appellants amongst others as Defendants but not even serving them with the documents. When they became aware and through their lawyers requested service, the First Respondent’s lawyers advised that they were removing them as parties and also were not pursuing the case further. Somewhat discreetly however, the First Respondent abandoned that action and commenced the action, the subject of this appeal but this time dropping them as parties. This was not an oversight; it was deliberate and calculated to shut out the First and Second Appellants.

In the earlier proceeding in this matter before him that we have alluded to already, the Deputy Chief Justice adequately addressed the issue which we fully endorse and adopt. His Honour said as per p.118 of the Appeal Book:

“I am satisfied on the evidence before me that the Applicants have ownership interests in the land in Portion 8C of the size described in the grant of 50,000 ha. I also find that the Plaintiff’s application for the size of that land was only 6,240 ha but the First Minister may have wrongly granted a lease in the size of 50,000 ha. Such a vast area of land must no doubt include land owned by other landowner groups such as the Applicants. I am also satisfied that the Applicant’s interest in the land was recognized in the Local and District Land Courts decisions and also in a subsequent National; Court decision on review presided by Los, J. further their interest was recognized when they were made defendants in OS No. 69 of 2003, which is still pending determination. Compensation for land and land ownership are inter-related in customary land tenure systems. They are in most cases inseparable.

I am also satisfied that the Applicants ought to have been served the Notice of Motion under Order 16 r 5(2) to accord them an opportunity to be heard on the application before a decision was made, even though they were not parties in the proceedings. The requirement to serve the application on all persons “directly affected” by the decision the subject of the review, is specific, mandatory and fairly elaborate. Order 16 r 5(2) and (6) provide:

“(2) The notice of motion must be served on all persons directly affected and where it relates to any proceedings in or before a court and the object of the application is either to compel the court or an officer of the court to do any act in relation to the proceedings or to quash them or any order made in them, the notice of motion must also be served on the clerk or registrar of the court and, where any objection to the conduct of the Judge is to be made, on the Judge.

(5) An affidavit giving the names and addresses of, and the places and dates of service on, all persons who have been served with the notice of motion must be filed before the notice of motion is entered for hearing and, if any person who ought to be served under this Rule has not been served, the affidavit must state that fact and the reason for it, and the affidavit shall be before the Court on the hearing of the notice of motion.

(6) If on the hearing of the notice of motion the Court is of opinion that any person who ought, whether under this Rule or otherwise, to have been served has not been served, the Court may adjourn the hearing on such terms (if any) as it may direct in order that the notice of motion may be served on that person.”

Also O 16 r 9 reinforces Order 16 r 5(2) and takes it one step further in recognizing the right of an interested party to be heard on the application. It recognizes the right of a person directly affected by the decision to be heard, even though the person is not a party to the proceedings and even though the person is not served with a Notice of Motion under O 16 r 5 (2). O 16 r 9(1) provides:

“(1) On the hearing of any notice of motion under Rule 5, any person who desires to be heard in opposition to the notice of motion, and appears to the Court to be a proper person to be heard, shall be heard, notwithstanding that he has not been served with the notice of motion.”

I find that the Applicants were ‘directly affected’ by the decision of the Second Minister and even the First Minister, they ought to have been heard. Order 16 r 5(2),(5) and (6) and r 9(1) provide an exhaustive procedure for any such person having an interest in the matter under review, and who is directly affected by the decision, to be afforded an opportunity, by the Applicant or the Court to be heard on the matter, even though they were not joined as parties to the initial proceedings.

..the Plaintiffs knew that the Applicants had an interest in the land but they failed to serve the Notice of Motion on them in order to give them an opportunity to be heard. This point was not raised by the Plaintiffs or the Defendants before His Honour. No affidavit containing a list of interested persons served with the Notice of Motion (sic) Order 16 r 5(2) was filed and no such inquiry was conducted to establish if they ought to be served under r 5(5) and (6). Also, an inquiry was not conducted under O 16 r 9(1) to ascertain the Applicants’ obvious interest in the land and opportunity given to them to be heard. The final decision was made without a full hearing on the merits of the case, with all interested parties being heard.”

The term ‘person directly affected’ has been determined already in this jurisdiction. It was submitted by the First Respondent’s counsel that the correct view is that taken in Kitogara Holdings Pty Ltd v NCDIC and Ors (supra) where the applicant was deemed to have been given due notice because it was aware of the proceedings but took no action and allowed the appeal time to run out. In this case according to the affidavit of Jonah Sasingian sworn 11 October 2004 filed in support of the First Respondent’s case in this appeal, the lawyers for the First and Second Appellants were aware of the proceedings as per their correspondence with the First Respondent’s lawyers (see annexure “A” to J. Sasingian’s affidavit referred to earlier) but they chose not to join the action and allowed judgment to be entered undefended against those named in the action.

But the First and Second Appellants argue that the same affidavit relied upon by the First Respondent shows that the lawyers for the First Respondent did not want to cooperate and assist the Appellants in their pursuit for justice according to law. This is evident in annexure “B” to J. Sasingian’s affidavit which is a letter from Ikennas Lawyers and Notaries dated 10^th August 2004 sent by facsimile to Pryke & Bray Lawyers for the attention of Mr David Poka. In part the letter reads:

“.............

Thank you for your 436.95/DP:fb of 6^th August, 2004.

This is to advise that if you conduct a search in the National Court file relating to O.S. No. 662 of 2003 therein you will find all the information you seek relating to the names of the Parties to the proceedings and whatever else you wish to ascertain.....”

This letter quite clearly was not written with the aim of answering the query raised by Pryke and Bray Lawyers based in Lae and representing the First and Second Appellants, landowners with vested interest in the land in question and who were based in Morobe. It was not a very helpful response particularly when the proceeding was commenced in Waigani instead of Lae where all the partiers are based.

We refer also to another recent judgment by Injia, DCJ that addresses this issue of ‘person directly affected’ in land ownership dispute in Jack Nou on behalf of Hagwaipi Clan of Madai Village-v- Richard Cherakee, Magistrate, Provincial Land Court Port Moresby, Dogome Naime [2004] Unreported National Court Judgment (delivered 30^th April 2004] N2539. The factual circumstances in that case are similar where the applicant for judicial review was seeking review of the decision of the Land Board over allocation of land. Issue arose on the standing of the applicant and Injia, DCJ said:

“In my view, as I intimated to counsel during argument, the relevant test on the standing of parties to be heard on the substantive review is set out in O 16 r 5(2) of the National Court Rules. That is whether that person is “directly affected” by the decision the subject of the review, and if so, that person is entitled to be served copies of the application for judicial review, affidavits, etc. Implicit in this is the right of such person to be heard on the substantive application, as a person directly affected by the decision. Such a person need not be a party to the Originating Summons seeking leave for judicial review which application afterall is made ex parte. Therefore, the appropriate application before this Court should be one seeking an order that the said documents be served on the Applicant as a person directly affected by the decision under review and be given an opportunity to be heard on the substantive application.

On the affidavits and other material before me, I am satisfied that the subject land the Applicant says her family owns is included in the decisions of the two courts. The land is also included in the decisions the subject of this judicial review application: see Statement in Support of application for leave, para. 1 & 2. I am also satisfied that the Morea family which she represents may have an interest in the land and, as the only surviving child of the late Morea Morea, she is entitled to speak on her family’s land interests in the review. The purpose of the present application before me is not for me to determine her land rights, if any, over the subject land but merely to join her as a party to these proceedings in order to facilitate her right to be heard on the application as a person directly affected by the two decisions. Under O 16 r 5(2), it really does not matter that she was not a party to the proceedings before the land court, for whatever the reason might be. The determinative test is whether she is “directly affected” by the decisions. Whilst I accept that a person who is not a party to a legal, judicial or quasi-judicial proceeding cannot be said to be “directly affected” by the decision, customary land ownership and usage right issues are more complex than they appear to be on the face of record of those proceedings and the National Court reviewing such decisions must be careful in ensuring that persons genuinely affected by those decisions, albeit strictly not parties in person in those proceedings, are heard on the application, before a decision is made.”

We are entirely in agreement with His Honour’s determination and application of the law as stated in O 16 r 5(2). The rule is designed in the way that it keeps open the avenue for all persons with sufficient interest in a subject matter to get involved in any dispute at the earliest opportunity if it affects him or going to affect him so that he is heard before the decision is made. To narrow down its application can result in injustice.

Judgment obtained by deliberate abstinence from compliance with mandatory requirements of the Rules to defeat fair and just aim of attaining remedy through legitimate process must be set aside ex debito justitiae. As the Supreme Court said in Leo Hannet and Elizabeth Hannet v ANZ Banking Group [1996] SC505 the Supreme Court said:

“In the present case we are concerned with judgments entered irregularly. The question then arises; how should the Court exercise its discretion where the judgment is obtained irregularly?

The Courts in Papua New Guinea have quoted authorities from England as well as Australian States on this issue. The most often quoted authority on this issue is Anlaby v Praetorius [1888] UKLawRpKQB 55; (1888) 20 QBD 764 which stands for the proposition that if a judgment is entered irregularly, the defendant is entitled to set it aside ex debito justitiae (as required in the interests of justice). This principle was approved in Green & Company Pty Ltd v Green [1976] PNGLR 73; Smeeton v Davara House Pty Ltd [1979] PNGLR 324; Page P/L v Malipu Balakau [1982] PNGLR 140. This authority is also referred to in Bank of South Pacific v Spencer [1983] PNGLR 239.”

We agree with the appellants counsel that the requirements of Order 16 Rule 5 sub-rules (2), (5), (6) and Rule 9(1) are mandatory requirements to be complied with. The judgment that is obtained without complying with these mandatory requirements is irregular and must as a matter of law be set aside ex debito justitiae. The appeal must therefore succeed on this issue.

❹ Minister Kopaol had power to revoke the lease granted on 24 July 2001 to Piu Land Group Inc. by the Delegate of the then Minister for Lands and Physical Planning.

We decided to also deal with this ground of appeal so that this action reaches its finality here rather then going back for further hearing in the National Court. We are convinced that there was nothing wrong with the Minister for Lands exercising his power of revocation of the lease granted by another Minister or a Delegate of Minister appointed by that earlier Minister. The Minister had power under the Land Act to grant lease and by the same token to revoke such a grant.

The law has been already settled since the decision of In the Application of the National Capital District Interim Commission [1987] PNGLR 339. In that case the court held that section 35 of Interpretation Act applied to section 25 of the Land Act to give meaning to that provision that empowered the relevant Minister to act accordingly, either to revoke, alter or vary a grant made under section 25 of the Land Act, such power to be exercised for good and justifiable reasons consistent with the public interest and public welfare. It is also common sense that if power is given to someone to do an act, it is only logical that he also has the power to undo his act if need be. As to how and why the Land Act is not precise in this message is unclear. Be that as it may, had there been due diligence and proper research made, the matter should not have been allowed to come this far as the First Respondent really did not have a case.

The First Respondent contended that Minister did not have power to revoke the grant of lease which was made by the Secretary who was the Delegate of the Minister for Lands. This submission was quite shallow and baseless because the Minister had abundant power still remaining with him to revoke a decision that was exercised under delegation. Section 4 of the Ministers’ (Delegation) Act Ch.35 and section 25 of the Ministers’ (Delegation ) Regulation combined do empower the Minister to act accordingly so we find no merits in this argument.

But leaving all that aside, a grant of 50,000 hectares of land without there being any application for it by the First Respondent in itself must surely be a cause for concern as it is a clear evidence of abuse of power by a public authority. That should have been sufficient for any clear thinking person to recognize the anomaly and seek to have it corrected rather than defending a decision that was close to corrupt exercise of power in the first place. We are satisfied on the evidence in the transcript that the First Respondent only applied for Portion 8C Subdivide of 6,240 hectares, the same piece of land that Yanta and Hengambu Clans already had 50-50 beneficial interests over in terms of ownership according to two Land Court decisions of 1985 and subsequently confirmed by the National Court on 20 October 1989 referred to earlier in the judgment.

That being so, the court on 18^th August 2004 was clearly misled, and the trial judge erroneously acceded to that submission by granting the relief sought when the true position was quite the opposite.

For this reason alone there is no issue remaining for the matter to go back to the National Court to be dealt with. This case must terminate here.

❺ Special Agricultural and Business Lease granted on 24 July 2001 to Piu Land Group Inc. is void.

We are also of the view that the lease granted to the First Respondent on 24^th July 2001 is void ab initio for two reasons. First, the grant of 50,000 hectares of customary land to one small group of customary landowners is both morally and legally wrong. From the point of view of the Minister for Lands, it lends itself to improper exercise of power or corruption especially when the applicant was asking for a much less volume and was allocated close to eight or nine times as much land as it asked for.

However from the landowners’ point of view, there are over five to seven villages inside the boundary of the land that the First Respondent sought to have it all for itself. That is not a sensible thing to do in a customary setting where communal ownership still remains strong and hundreds of people in other villages whose customary lands are also inside that circle. As the affidavit of Thomas Nen shows, he was a member of Babwaf clan which owned the land known as ‘Manganse’ or ‘Mangnese’ situated on the lower part of Watut River which is inside the 50,000 hectares. They defended their right of ownership of this land against other claimants and won in the Provincial Land Court which confirmed the Local Land Court decision. This decision is dated 14^th May 1982 and still remains in force. The decision granting 50,000 hectares of customary land to a single group cannot be allowed to remain. It is tantamount to unjust enrichment of the First Respondent and unlawful acquisition of land from legitimate owners.

Another equally strong reason is that the application for the lease made on 22^nd February 2001 did not have the knowledge, approval or consent of all the landowners in the affected areas. It was all done in secret, with undue haste and ulterior motive driven by greed. Evidence provided in the affidavit of Lawrence Billy alluded to earlier shows clearly that none of the requirements of the Act were complied with. Both these sections provide:

“11. Acquisition of Customary Land for the grant of special agricultural and business lease.

(1) The Minister may lease customary land for the purpose of granting a special agricultural and business lease of the land.

(2) Where the Minister leases customary land under Subsection (1), an instrument of lease in the approved form, executed by or on behalf of the customary landowners, is conclusive evidence that the State has a good title to the lease and that all customary rights in the land, except those which are specifically reserved in the lease, are suspended for the period of the lease to the State.

(3) No rent or other compensation is payable by the State for a lease of customary land under Subsection (1).

Division 9.—Special Agricultural and Business Leases.

102. Grant of special agricultural and business leases.

(1) The Minister may grant a lease for special agricultural and business purposes of land acquired under Section 11.

(2) A special agricultural and business lease shall be granted-

(a) to a person or persons; or

(b) to a land group, business group or other incorporated body,

to whom the customary landowners have agreed that such a lease should be granted. (Emphasis is added)

(3) A statement in the instrument of lease in the approved form referred to in Section 11(2) concerning the person, land group, business group or other incorporated body to whom a special agricultural or business lease over the land shall be granted, is conclusive evidence of the identity of the person (whether natural or corporate) to whom the customary landowners agreed that the special agricultural and business lease should be granted.

(4) A special agricultural and business lease may be granted for such period, not exceeding 99 years, as to the Minister seems proper.

(5) Rent is not payable for a special agricultural and business lease.

(6) Sections 49, 68 to 76 inclusive, 82, 83, 84 and 122 do not apply to or in relation to a grant of a special agricultural and business lease.

(7) Notwithstanding anything in this Act, a special agricultural and business lease shall be effective from the date on which it is executed by the Minister and shall be deemed to commence on the date on which the land subject to the lease was leased by the customary landowners to the State under Section 11.”

The Affidavit of Lawrence Billy sets out the procedure for compliance in respect of application for lease-lease back leases provided under ss. 11 & 102 of the Act in paragraphs 7 to 18 at pages 125 -126 of the Appeal Book. It is a very elaborate procedure which begins with the consensus of all the landowners within the subject land area being first obtained and the involvement of the Provincial Administration from survey of the land to registration and issue of lease and production of certificate of title. There is no short-cut to this process. This is quite understandable as land is precious to the people of this country. It cannot be alienated from them in the way it was attempted here by a single group. The overwhelming evidence before the Court is that there was no discussion involving all the landowners and there was no consensus or agreement between the others and Piu Land Group Inc.

5. The Judgment of the Court
   

The appeal is upheld. Judgment of the National Court dated 19^th August 2004 is quashed. The grant of lease to the First Respondent on 24^th July 2001 by the Delegate of the Minister for Lands and Physical Planning and gazetted on 26^th July 2001 National Gazette No.G94 is declared null and void ab initio. This court in the exercise of its inherent powers under the Constitution can prevent this action proceeding further in the manner it has been allowed to progress this far in the absence of all affected parties. The parties are now at liberty to resolve outstanding ownership issues need there be any.

This case demonstrates very clearly the unfairness of the court system that permits and tolerates parties commencing court proceedings in different locations in the country where the National Court registries are established as opposed to the registry nearest to the place where the parties are ordinarily resident or their causes of action arose, whose motives may not be legitimate or may be shrouded in fraud such as to defeat the course of justice. This tactic has the very real potential of shutting out or disadvantaging those with legitimate interests in the proceeding of being heard as had happened in this case and grave injustice can result. Had this action been commenced and proceeded with in Lae, as requested by the lawyers representing those affected landowners, bearing in mind that the disputed land is situated in the Morobe Province and all the affected landowners are simple villagers living in the mountainous terrains of Mumeng District in the Morobe Province, this matter could have been dealt with fairly and promptly. We consider this as relevant factor on the question of costs in this matter.

We reserve submissions on costs to the next sittings on the Supreme Court in Waigani.

Lawyers for the First and Second Appellants: Gadens Lawyers
Lawyers for the Third Appellant: Dotaona Lawyers
Lawyers for the Fourth Appellant: Ketan Lawyers
Lawyers for the First Respondent: Ikennas, Lawyers & Notaries
Lawyers for the Second, Third and Fourth Respondents: Solicitor General