Micah v Lua [2015] PGSC 40; SC1445 (15 July 2015)

SC1445

PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]

SCM NO. 12 OF 2015

BETWEEN

HONOURABLE BEN MICAH, MP
Appellant

AND

RIGO A. LUA, CHIEF OMBUDSMAN
First Respondent

AND

PHOEBE SANGETARI, OMBUDSMAN
Second Respondent

AND

OMBUDSMAN COMMISSION OF PAPUA NEW GUINEA
Third Respondent

AND

PONDROS KALUWIN, PUBLIC PROSECUTOR
Fourth Respondent

Waigani: Cannings, Makail & Higgins JJ
2015: 02nd & 15th July

SUPREME COURT APPEAL – Appeal against refusal of grant of leave to apply for judicial review – Leave sought to review decision of Ombudsman Commission to refer Leader to Public Prosecutor for prosecution – Principles of leave considered – Arguable case – Exhaustion of administrative remedies.

CONSTITUTIONAL LAW – Alleged misconduct in office by Leader – Investigation of – Right of Leader to respond to allegations – Further information or evidence obtained after Leader responded to allegations of misconduct in office – Whether Leader has right to respond to further information or evidence – Natural justice – Right to be heard – No reasons of referral given to Leader – Duty to give reasons – Failure to give reasons – Constitution – Section 59 – Organic Law on Duties and Responsibilities on Leadership – Sections 20 & 21.

Cases cited:
Papua New Guinea cases

Hon. Ben Micah v. Rigo A. Lua & Ombudsman Commission (2015) N5972
Innovest Limited v. Patrick Pruaitch (2014) N5949
Digicel (PNG) Ltd v. Miringtoro (2015) SC1439
Ombudsman Commission v. Peter Yama (2004) SC747
Joe Ponau v. Teaching Service Commission Disciplinary Committee (2006) N3059 Mision Asiki v. Manasupe Zurenuoc (2005) SC797
Niggints v. Tokam [1993] PNGLR 66
Yawip v. Commissioner of Police [1995] PNGLR 93
Wena v. Tokam (1997) N1570
Graham Kevi v. Teaching Service Commission Disciplinary Committee [1997] PNGLR 659
Michael Anis Winmarang v. David Ericho and The State (2006) N3040.
Grand Chief Sir Michael Somare v. Chronox Manek & Ombudsman Commission (2011) SC1118
Eremas Wartoto v The State (2015) SC1411
Chief Collector of Taxes v. Bougainville Copper Limited (2007) SC853
Ramu Nico Management (MCC) v. Eddie Tarsie (2010) SC1075
Peter O'Neill v. Pondros Kaluwin & Ors (2015) N5843

Overseas cases

Revenue Commissioners v. National Federation of Self-Employed and Small Business Limited [1981] UKHL 2; [1982] AC 617

Counsel:

Mr. I. Molloy with Mr. N. Saroa, for Appellant
Mr. A. Chillion, for Respondents

JUDGMENT

15th July, 2015

1. BY THE COURT: This is an appeal against the primary judge's refusal to grant leave to the Appellant to apply for judicial review under Order 16, rule 3 of the National Court Rules. The subject of the application for leave was the decision of the Third Respondent (Ombudsman Commission) to refer the Appellant to the Fourth Respondent (Public Prosecutor) for prosecution for alleged misconduct in office.

BACKGROUND FACTS

2. The Appellant is a Member of the National Parliament and Minister for Public Enterprises and State Investments. The Ombudsman Commission investigated allegations of misconduct in office by the Appellant. On 08th July 2014, the Appellant was informed by letter from the Ombudsman Commission to personally attend at the Office of the Ombudsman Commission on 11th July 2014. On that day, the Appellant attended the meeting and was informed that there were four (4) allegations of misconduct in office made against him. These allegations were:

(a) that he interfered with the Board of PNG Power Limited.

(b) that he denied any knowledge of PNG Power Limited's financial crisis.

(c) that he used his office to obtain a benefit in hotel accommodation at the Grand Papua Hotel.

(d) that he defied a directive by the Ombudsman Commission.

3. He was asked to respond to them. On 15th August 2014 (after he was granted an extension of time), he responded to the allegations. Nothing further was heard from the Ombudsman Commission until 09th March 2015 when the Appellant was referred to the Public Prosecutor for prosecution. What occurred on 09th March appears to be the cause of the conflict between the parties. The Appellant was again requested by the Ombudsman Commission to attend a meeting at the Office of the Ombudsman Commission on that date. He obliged and the First Respondent in the presence of the Director, Leadership Branch Mr Richard Pagen served on him a notice and reasons for his referral. It is claimed these documents were contained in an envelope and handed to him and he was asked to sign a service delivery form. The Appellant refused to sign the form or accept the envelope and walked out of the meeting. He told the First Respondent and Mr Pagen that he would take the matter up in Court.

GROUNDS OF REVIEW

4. He claimed firstly, the Ombudsman Commission had obtained additional information (evidence) against him between 15th August 2014 and 09th March 2015 and had not given him an opportunity to respond to it. This was a denial of natural justice; the right to be heard before judgment or adverse decision as guaranteed by Section 59 of the Constitution. Secondly, the Ombudsman Commission had not provided him with reasons for the referral to the Public Prosecutor for alleged misconduct, which reasons were required to be good, proper, sufficient and meaningful.

NATIONAL COURT DECISION

5. In the National Court he sought leave to apply for judicial review to have the Court review the decision of the Ombudsman Commission to refer him to the Public Prosecutor and have that decision quashed by an order for certiorari. On 08th May 2015 the National Court heard the application for leave and reserved its decision. On 20th May 2015 it handed down its decision refusing leave. It held the Appellant failed to meet two of the requirements for grant of leave: that he failed to establish firstly an arguable case and secondly, exhaust other administrative remedies: see Hon. Ben Micah v. Rigo A. Lua & Ombudsman Commission (2015) N5972.

ISSUE 1: ARGUABLE CASE – RIGHT TO BE HEARD

6. A person who seeks to challenge a primary judge's exercise of discretion must show an error of principle. In judicial review proceedings under Order 16 of the National Court Rules, it has been held the test whether the Court should grant leave to apply for judicial review is not a difficult one to satisfy. In this case, it was correctly stated by the primary judge in quoting Lord Diplock in Inland Revenue Commissioners v. National Federation of Self-Employed and Small Business Limited [1981] UKHL 2; [1982] AC 617 at 644 that "If, on a quick perusal of the material then available, the court (that is the judge who first considers the application for leave) thinks that it discloses what might on further consideration turn out to be an arguable case in favour of granting the relief claimed, it ought, in the exercise of judicial discretion, to give him leave to apply for judicial relief........". This test has been adopted and applied in many cases including Innovest Limited v. Patrick Pruaitch (2014) N5949 and very recently Digicel (PNG) Ltd v. Miringtoro (2015) SC1439.

7. The primary judge had held that there was no arguable case because the Appellant had been afforded the right to be heard on 11th July 2014 after he had been served four allegations of misconduct in office and invited to respond to them as he did on 15th August 2014.

8. The primary judge had further held that Section 21(1) of the Organic Law on the Duties and Responsibilities of Leadership ("Organic Law on Leadership") permitted the Ombudsman Commission from "time to time" to require any person to give information for any alleged or suspected misconduct in office by a Leader. On this authority, the Ombudsman Commission is not precluded from obtaining any further evidence or information even after the Leader has responded to the allegations, as was the case here. The primary judge reached this conclusion on the premise that the further evidence or information collected by the Ombudsman Commission was in relation to the same allegations, specifically, the allegation of the Appellant using his office to obtain a benefit in hotel accommodation.

9. The uncontested evidence before the primary judge was that between 14th August 2014 and early 2015, the Ombudsman Commission had requested (based on a summons) Mr Wasantha Kumarasiri, the former Managing Director of Independent Public Business Corporation to provide (the Grand Papua) information and/ or documents in relation to the allegation of the Appellant using his office to gain a benefit in hotel accommodation. Meanwhile on 16th February 2015 it wrote to Mr Alex Wilson, the General Manager of the Grand Papua Hotel requiring him to provide information and/ or documents in relation to the same allegation. The further information sought from Mr Wilson included whether the Appellant had accommodated family members at the hotel and who it was that paid for the accommodation and laundry. It was towards the end of February 2015 that both gentlemen provided information and documents to the Ombudsman Commission. This was 6 months after the Appellant had provided his response to the allegations on 15th August 2014. The information and documents were not given to the Appellant to respond to.

10. On this uncontested evidence, we consider that it is arguable whether there was a proper and valid referral of the Appellant by the Ombudsman Commission, and therefore whether the Public Prosecutor has been properly enlivened with jurisdiction to consider the referral under Section 27 of the Organic Law on Leadership. Every investigation by the Ombudsman Commission is governed by Section 20 of the Organic Law on Leadership. It is conducted in private. Section 20 states:

"20. Proceedings of the Commission.

(1) Every investigation by the Commission or other authority under this Law shall be conducted in private.

(2) The Commission or other authority may hear or obtain information from any person who the Commission considers can assist and may make whatever inquiries it thinks fit and shall, before taking action under Subsection (4) notify the person whose conduct is being investigated.

(3) Nothing in this Law compels the Commission or other authority to hold any hearing and no person, other than the person whose conduct is being investigated is entitled as of right to be heard by the Commission.

(4) If, after an investigation, the Commission is of the opinion that there is evidence of misconduct in office by a person to whom this Law applies, it shall refer the matter to the Public Prosecutor for prosecution by him before the appropriate tribunal." (Emphasis added).

11. Sub-section (3) of Section 20 states that the person whose conduct is being investigated is entitled as of right to be heard by the Ombudsman Commission. In our view, it is arguable whether the Appellant is entitled to be afforded a right to be heard under Section 20(3) after the Ombudsman Commission had obtained further information or evidence and after he had responded to the allegations of misconduct in office on 15th August 2014.

12. On one view, as was advanced by the Appellant is that, the Ombudsman Commission is bound by Section 20(3) to afford him the right to be heard because it has received further information or evidence in relation to the allegations of misconduct in office by him. And it could be further argued that it is irrelevant whether the further information or evidence is in relation to the subject allegations of misconduct in office by him or in relation to new or "fresh" allegation(s) of misconduct in office by him. The Appellant's proposition is further supported by Section 20(4) which states that, if after an investigation, the Ombudsman Commission is of the opinion that there is evidence of misconduct in office by the person it shall refer the matter to the Public Prosecutor for prosecution. As Sub-section (4) uses the phrase "If, after an investigation", it could also be argued that all the gathering of information or evidence by the Ombudsman Commission must be completed and given to the Appellant to respond (right to be heard) before a decision is made by the Ombudsman Commission to refer him to the Public Prosecutor for prosecution.

13. There are two reasons for this proposition. Firstly, the Ombudsman Commission's decision to refer the Appellant to the Public Prosecutor for prosecution can only be arrived at based on the information or evidence gathered by it during its investigation and the response from the Appellant. In other words, the gathering of information or evidence is part of the investigation process under Section 20 and the investigation is complete after the Appellant provides his response to the information or evidence supporting the allegations of misconduct in office. For this reason, it could be argued that it is not envisaged by Section 20 that the investigation be conducted in a piece-meal fashion. Based on this interpretation, it could be argued that when the Ombudsman Commission had received further information or evidence, from the Grand Papua Hotel in relation to the allegation of the Appellant using his office to obtain a benefit in hotel accommodation, the Appellant was entitled to ask to be heard on the further information or evidence received by the Ombudsman Commission.

14. Failure by the Ombudsman Commission to afford the Appellant a right to respond, it could be argued, was a denial of natural justice; the right to be heard under Section 59 of the Constitution.

15. Secondly, any referral by the Public Prosecutor to the appropriate tribunal depends upon a valid referral by the Ombudsman Commission, in the first instance, to the Public Prosecutor. Serious consequences flow from the referral. As the Supreme Court recognised in Ombudsman Commission v. Peter Yama (supra):

"Serious consequences flow to the leader and the office that he holds from the investigations which have been concluded by the Commission and the decision made to refer the leader to the Public Prosecutor or the tribunal."

16. The counter proposition is that where further information and evidence relate to the same allegation(s) and are gathered by the Ombudsman Commission after the Leader has responded to the allegation(s), the Ombudsman Commission is not duty bound to give the Leader a further right to be heard in relation to the further information and evidence. This was the view formed by the primary judge based on Section 21 of the Organic Law on Leadership. Section 21 states:

"21. Production of documents, etc.

(1) Subject to the provisions of this section and of Section 22, the Commission or other authority may from time to time require any person who in its opinion is able to give any information relating to any alleged or suspected misconduct in office by a person to whom this Law applies that is being investigated by the Commission or other authority to furnish to it that information and to produce any documents, papers or things that, in the opinion of the Commission or other authority, relate to any matter being investigated by it and that may be in the possession or control of that person.

(2) ............." (Emphasis added).

17. It could be argued that this was not a case where the Appellant was not afforded the right to be heard at all. He was afforded that right when he was invited to respond to the allegations on 11th July 2014. He responded to the allegations on 15th August 2014. The further information or evidence obtained by the Ombudsman Commission after the Appellant had responded to the allegations were part of the on-going investigation and was necessary to enable the Ombudsman Commission to arrive at a decision to refer or not to refer the Appellant to the Public Prosecutor for prosecution. As the information or evidence formed part of the case supporting the allegations which the Appellant had previously responded to, it was not necessary to invite the Appellant to make a further response.

18. On the question of right to be heard, this Court is satisfied it is arguable the Appellant had a right to be heard and must be accorded to him from the time the Ombudsman Commission received further information or evidence in relation to the allegations against him. This ground is upheld.

ISSUE 2: ARGUABLE CASE - LACK OF REASONS

19. The primary judge had upheld the proposition that the Ombudsman Commission was duty bound by the principles of natural justice under Section 59 of the Constitution and as held by the Supreme Court and National Court in many cases including Ombudsman Commission v. Peter Yama (2004) SC747 to give meaningful and sufficient reasons for the decision. But the primary judge had further held that as the Appellant had refused to accept the envelope and documents in it being the Notice of Referral and presumably the reasons for the referral tendered to him at the meeting on 09th March 2015, he cannot now complain about the lack of reasons.

20. As to the issue of lack of reasons for the referral, the Respondents had not produced evidence of the reasons before the National Court nor before this Court. Yet it was argued for the Respondents that the Appellant was given reasons for his referral. They were able to persuade the primary judge to uphold this submission. The basis for the primary judge reaching this conclusion was that the Appellant was tendered the reasons at the meeting on 09th March 2015 and refused to accept the documents containing them. He cannot now complain about it. This is true but the converse of that is also true. There was no evidence of reasons before the primary judge to support the finding on that issue. Therefore, it was incumbent on the Respondents to produce the reasons (in written form) at least before the primary judge. They did not. Thus, it could be argued that the finding of the primary judge on this issue was unsupported by evidence and an error is apparent.

21. The Appellant's insistence on being given the reasons may appear to be nitpicking but in Ombudsman Commission v. Peter Yama (supra), the Supreme Court made it abundantly clear it is one of the "fundamentals of good administration" that the Ombudsman Commission give "good and proper reasons for its decision to refer" and that such reasons must be "meaningful and sufficient reasons".

22. It cannot be emphasised enough that the duty to give reasons is now regarded in Papua New Guinea as an integral part of the duty of a public official to accord natural justice to those affected by the official's decisions: Joe Ponau v. Teaching Service Commission Disciplinary Committee (2006) N3059. If a decision-maker has a duty to accord natural justice, there is a duty to give reasons; and if no reasons are given, that means there are no good reasons and the decision-maker will have acted in excess of jurisdiction. If there is no express duty to give reasons, the duty will be implied. Those principles were applied by the Supreme Court in Ombudsman Commission v Peter Yama (supra) and Mision Asiki v. Manasupe Zurenuoc (2005) SC797. The National Court has applied the same principles, some of the cases were Niggints v. Tokam [1993] PNGLR 66; Yawip v. Commissioner of Police [1995] PNGLR 93; Wena v. Tokam (1997) N1570; Graham Kevi v. Teaching Service Commission Disciplinary Committee [1997] PNGLR 659 and Michael Anis Winmarang v. David Ericho and The State (2006) N3040.

23. It was further argued, it would seem, as an alternative for the Respondents that the Notice of Referral was also the reasons for the referral. They are found in Ombudsman Commission's letters to the Appellant dated 09th March 2015 and 26th March 2015. A close examination of these letters reveals that apart from a very brief recital of the events of 09th March 2015 (meeting) in the second letter, it gave no reasons for the referral. It was also argued that at the meeting, the First Respondent had explained to the Appellant why he was referred to the Public Prosecutor. But the evidence before the primary judge does not support this assertion. The lack of reasons may explain why the Appellant is insisting on being given reasons for his referral. The duty to give reasons is important and failure may result in the Ombudsman Commission denying the Appellant natural justice and exceeding its powers. It was an important point of law missed by the primary judge and will have to be further considered at the substantive hearing. In any event, it is not appropriate or sufficient for reasons to be given orally if not confirmed or transcribed in writing available to the interested parties.

24. That said, it is necessary to go back to the meeting of 09th March 2015. What occurred on that date appears to be the cause of the conflict. The evidence before the primary judge established that the Appellant refused to sign the service delivery form and accept the envelope containing the Notice of Referral and walked out of the meeting. After realising that he did not know why he had been referred for prosecution, he made numerous requests in person or through his lawyers to the Ombudsman Commission and the Public Prosecutor to be furnished with reasons for his referral but had not received any positive response.

25. Even after the Appellant commenced proceedings in the National Court, neither the Ombudsman Commission nor the Public Prosecutor produced the Notice of Referral or reasons of the referral in their defence to the application for leave. In making this point, it is noted that the hearing of a leave application is strictly ex parte save for the State. Counsel who appeared for the State was given an opportunity to respond to the application by virtue of Section 8 of the Claims By and Against the State Act, 1996. Counsel for the State had further sought an adjournment and was granted time to prepare and respond to the application. Though the Respondents were not represented, at the very least, the State was and it was incumbent on it to produce evidence of these matters before that Court and before this Court. That was not done and to this day, it is not known if the Ombudsman Commission had actually issued a Notice of Referral and/ or given reasons for the referral.

26. It is understandable that the Appellant may have been disrespectful when he walked out of the meeting. As a Leader, it was expected of him to submit to the jurisdiction of the Ombudsman Commission and not to conduct himself in a manner that would be considered as undermining the authority of the Ombudsman Commission. It is equally understandable that he may have been frustrated by the news of his referral and over-reacted because of the long delay by the Ombudsman Commission in completing its investigation. When two parties are on equal footing and are not prepared to give in, it is often difficult to see a way out of the conflict. But the law, as stated, placed the onus on the Ombudsman Commission to give reasons for referral: Ombudsman Commission v. Peter Yama (supra). And on this basis, the conflict could have been resolved amicably amongst the parties had the Ombudsman Commission provided the Notice of Referral and reasons to the Appellant soon after the meeting. This would have put to rest the issue of lack of reasons.

27. Although the appeal is against the refusal of leave, the Supreme Court has wide discretion under Section 16 of the Supreme Court Act to issue orders in appropriate cases to attain justice. Under Section 16 (supra), this Court may, amongst other things, affirm, reverse, or modify the judgment of the National Court, or give such judgment as ought to have been given in the first instance or remit the case in whole or in part for further hearing. It is considered this is an appropriate case where an order should be issued directing the Ombudsman Commission to provide the Notice of Referral or reasons to the Appellant. In that way, it should put to rest the issue of lack of reasons or at least help to resolve one of the grounds of review. This ground is upheld.

ISSUE 3: EXHAUSTION OF ADMINISTRATIVE REMEDIES

28. With regard to the question of exhaustion of administrative remedies, after referring to the Supreme Court case of Grand Chief Sir Michael Somare v. Chronox Manek & Ombudsman Commission (2011) SC1118 and recently, the Supreme Court case of Eremas Wartoto v. The State (2015) SC1411, the primary judge had held that the Appellant's rights were not extinguished when he was referred to the Public Prosecutor. On that basis, he was at liberty to raise the issue of his right to be heard and the lack of reasons for referral as preliminary issues before the Leadership Tribunal, if the Public Prosecutor decides to bring proceedings for misconduct in office against him.

29. The proposition advanced on behalf of the Appellant was straight forward. There were no other avenues available by which the Appellant could have sought recourse except by an application for judicial review in the National Court. The Appellant did that and failed. The primary judge erred when forming the view that the referral of the Appellant to the Public Prosecutor for prosecution was part of the whole investigatory process and any challenge to the legality or validity of the referral should be brought up before the Leadership Tribunal, if the Public Prosecutor decides to bring proceedings against the Appellant.

30. It was the further argument of the Appellant that the primary judge's finding on this issue was erroneous because only the Courts have jurisdiction to determine the legality or validity of decisions or actions of administrative bodies such as the Ombudsman Commission. The Leadership Tribunal, if one were to be constituted, to investigate the Appellant, would lack jurisdiction. In our view, unless there is a valid referral of a Leader, the Leadership Tribunal would be acting in excess of its powers if it was to conduct an inquiry into allegation(s) of misconduct in office by the Leader. In other words, the Leadership Tribunal is not empowered to investigate a matter without a valid referral.

31. The cases referred to by the primary judge do not address the issue of the jurisdiction of the Leadership Tribunal to deal with a preliminary objection on the question of jurisdiction and the legality or validity of the referral by the Ombudsman Commission. It was only suggested in these cases that these sorts of issues raised by the Appellant could be raised at the Leadership Tribunal. These suggestions were made to counter criticism that Leaders investigated for misconduct in office were challenging their referrals in Court deliberately to frustrate the referral and prosecution processes and in an attempt to divert attention from the allegations against them, to buy time, or delay the referral so that the Leader does not have to face the Leadership Tribunal. The same considerations apply to the Public Prosecutor's powers to prosecute or refrain from prosecuting the referral: Peter O'Neill v. Pondros Kaluwin & Ors (2015) N5843. This leaves only the National Court to determine the legality or validity of the referral. An error of law is apparent here. This ground is upheld.

CONCLUSION

32. The appeal did not challenge the primary judge's finding in relation to question of standing of the Appellant and delay because they were not in issue. As to the question of arguable case, the different propositions put forward by the parties regarding the right to be heard on the further evidence or information and lack of reasons sufficiently establish an arguable case. Lastly, this Court is satisfied there are no other administrative remedies by which the Appellant may seek redress. The only avenue is the National Court. The Appellant has, therefore, met the requirements for leave and should have been granted leave. As leave was refused, the primary judge erred. Pursuant to Section 16 (supra) the Court orders that the appeal be upheld, the National Court decision refusing leave is quashed, and further leave is granted and the matter be remitted to the National Court for further hearing in relation to the right to heard. As to the Ombudsman Commission's failure to provide reasons of the referral, it is further ordered that it provide them to the Appellant within seven (7) days of this order.

ORDER

33. The orders are:

1. The appeal is upheld.

2. The National Court decision of 20th May 2015 refusing the Appellant's application for leave to apply for judicial review is quashed.

3. The Third Respondent shall provide the reasons of the referral to the Appellant within seven (7) days of this Order.

4. The matter is remitted to the National Court for further hearing and listed on the next available date for directions hearing.

5. The Respondents shall pay the costs of the appeal, to be taxed, if not agreed.

______________________________________________________________
Nelson Lawyers: Lawyers for the Appellant
Acting Solicitor-General: Lawyers for the Respondents