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VJ Holdings Ltd (15-1339) v Ngusu Glan Ltd [2022] PGSC 145; SC2353 (25 August 2022)

SC2353


PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]


SCA 91 OF 2022 (IECMS)


BETWEEN:
VJ HOLDINGS LIMITED (15-1339)
First Appellant


AND:
STEVEN WAWAO and his agents and associates
Second Appellant


AND:
NGUSU GLAN LIMITED
Respondent


Waigani: Logan, Anis and Dingake JJ
2022: 25th August


PRACTICE & PROCEDURE – application to vary orders of a single judge of the Supreme Court – where single judge granted stay of orders in National Court pending determination of appeal – where no transcript of proceeding before single judge – where applicant required to show error of principle by single judge – where no such error demonstrated – application dismissed


Facts:


The appellants sought to appeal orders made by the National Court on 6 June 2022 to the Supreme Court. Following the filing of that appeal, the appellants also applied to the Supreme Court for orders staying the operation of the orders made on 6 June 2022, pending the determination of the appellants’ appeal. That application was ultimately successful, with a single judge of the Supreme Court making orders on 13 July 2022 staying the operation of the National Court’s orders.

The respondent sought to challenge the orders of the single judge of the Supreme Court in granting the stay. However, no transcript of the proceeding before the single judge was obtained. Evidence before the single judge disclosed the imminent risk of the appellants’ forestry license being cancelled on the strength of the National Court’s orders.


Held:


  1. Assuming (but not deciding) that the Supreme Court has inherent jurisdiction to review an order of a single judge, the nature of the review is analogous to that of the Supreme Court reviewing a decision of a single judge to grant or refuse to grant a stay: Yamanea v Ila’ava [2014] PGSC 14; SC1386 referred to.
  2. In the absence of a transcript of the proceeding before the single judge, the respondent was not able to establish a basis upon which the single judge’s orders should be disturbed.

Cases Cited
Papua New Guinean Cases


McHardy v Prosec Security and Communication Ltd [2000] PNGLR 279
Yamanea v Ila’ava [2014] PGSC 14; SC1386


Legislations


Constitution of the Independent State of Papua New Guinea
Supreme Court Act 1975
Supreme Court Rules 2012


Counsel:


Mr. R Raka, for the Appellants
Mr. E Isaac, for the Respondent


25th August, 2022


  1. LOGAN J: On 6 June 2022, in National Court proceedings of OS number 204 of 2021 between Ngusu Glan Limited (Ngusu) as plaintiff and VJ Holdings Limited (VJ Holdings) as first defendant and Steven Wawao and his agents and associates as second defendant, the National Court made the following orders:
  2. Being dissatisfied with those orders, VJ Holdings filed in the Supreme Court, on 28 June 2022, a notice of appeal wherein for grounds set out in that notice, it sought that its appeal be allowed the orders made on 6 June be quashed and that there be a declaration pursuant to s 155(4) of the Constitution of the Independent State of Papua New Guinea and the inherent jurisdiction of the Supreme Court that the LMA and MOU remain valid for all intents and purposes.
  3. It is not necessary for present purposes to pass upon whether it was in any way apt for VJ Holdings to add to the orders that it sought, an application for a declaration under s 155(4) of the Constitution in the terms indicated. On the strength of the institution of the appeal, VJ Holdings Limited applied to the Supreme Court for a stay of the operation of the orders made in the National Court. It sought that:

(a) That the requirements for service be dispensed with.

(b) Pursuant to s 19 of the Supreme Court Act and 155(4) of the Constitution, the entire proceedings and orders of the National Court made on 6 June 2022 be stayed forthwith pending the hearing and determination of the appeal.

(c) That costs of the stay application be costs in the appeal.

  1. On 13 July 2022 for reasons which were delivered ex tempore, a single judge of the Court ordered:
  2. The respondent to the appeal now seeks to challenge the order of 13 July 2022 by which a stay was granted. The application seeks to invoke s 155(4) and s 185 of the Constitution as well as Order 11, Rules 25 and 32(1) of the Supreme Court Rules 2012, and s 5(3) and s 19 of the Supreme Court Act 1975 as the basis for the challenge. Alternatively, Ngusu seeks directions from the court pursuant to s 185 of the Constitution and Order 11, Rule 9 of the Supreme Court Rules from this Court if it finds that there is not otherwise sufficient provision for a challenge to a stay order made by a single judge under s 19 of the Supreme Court Act.
  3. There was some agitation before us as to the appropriate means by which a stay order made under s 19 of the Supreme Court Act might be challenged. Reference in that regard was made to s 155(2) of the Constitution. It is not necessary in my view to embark upon any definitive consideration of the foundation for such a challenge. It was accepted by counsel for the appellant that the Supreme Court did have an inherent jurisdiction to review such an order. In my view, so much would follow from s 155(2) of the Constitution but, I emphasise, in light of the absence in the course of submission of any controversy, it is truly unnecessary to reach a definitive view.
  4. Assuming, as I consider it appropriate in the circumstances, that there is such a review jurisdiction the nature of it in my view, is not materially different in relation to a challenge to the granting of a stay to a challenge to the refusal of a stay in Yamanea v Ila’ava [2014] PGSC 14; SC1386.
  5. The Court (Salika DCJ, as his Honour then was, and Sawong and Logan JJ) stated (at [16]):

“16. To overturn the order of a judge of the Supreme Court dismissing the stay application it would not be enough that we might have come to a different conclusion as to where the balance of convenience lay. Materially, we would have to be persuaded that, on the evidence before him, it was unreasonable for his Honour to have concluded that the balance of convenience lay against granting the stay sought by Mr Yamanea. This we are unable to do. Quite apart from the absence of a compelling case on the facts in relation to the age controversy, there is the public interest in a potential disruption in the leadership of the Authority, which performs an important role for the benefit of all in Papua New Guinea to consider, as well as the proposition that, if all is ultimately said and done in Mr Yamanea's favour at trial, damages may be an adequate remedy.”

  1. I consider that a like approach is apt in relation to a challenge to the granting of a stay. In turn that means that Ngusu faces the very considerable difficulty that it has not sought and obtained a transcript of the proceedings in respect of the granting of the stay and in particular the reasons as given by the learned primary judge for the granting of a stay. In effect, we are left to address whether on the very face of the evidence before the primary judge, there was axiomatically an error of principle evident.
  2. The grounds upon which the challenge was sought to be made were these:
  3. As to these, it is evident from the order made by the learned primary judge that his Honour was persuaded that there was a case for some dispensation in relation to service.
  4. Further, and in any event, there was an appearance on behalf of the respondent by its lawyers on 13 July 2022 at which time there was an application for an adjournment of the hearing of the stay application. That adjournment application was refused.
  5. Once again, it is not possible to determine whether there was any error in that refusal because we do not have the benefit of a transcript. But in any event having refused the adjournment, the learned primary judge then self-evidently went on to hear submissions on the merits from each of the parties. A consequence of that, is that there is no substance in the allegation of a denial of natural justice, at least on the basis of the material that we have before us.
  6. Once again, to develop that argument, there would be a need for a transcript of the proceedings. We do not have that. It is then said, as to the non-discretional material facts, that there was an existing restraining order in another proceeding, OS number 109 of 2022, which was not made known to the learned primary judge.
  7. That may be so but an investigation of the parties to OS number 109 of 2022 discloses that Ngusu was not a party to that proceeding, even though, as may be accepted, that proceeding concerned the same land. But on the face of the order made in OS number 109 of 2022, as a non-party, it was not bound by it.
  8. It is then said that there is no arguable case. Assessing that was a matter for the learned primary judge. For us to determine that his Honour made error in that assessment, we would need to see his Honour’s reasons. On the face of them, the grounds of appeal are not frivolous. Whether or not they have any merit, is a matter for substantive hearing.
  9. I find it not just difficult but impossible to see, given the material before us, any error of principle by the learned primary judge in assessing that criteria.
  10. It is then put that there is prejudice to Ngusu by the granting of the stay order. So much may be accepted, as it doubtless was by the learned primary judge in reaching an assessment as to relative prejudice and where having regard to relative prejudice and balance of convenience and the existence or otherwise of an arguable case, the interests of justice lay in relation to the granting of a stay.
  11. It is not sufficient to demonstrate error of principle just to point to a prejudice to Ngusu. Of course there was prejudice. But equally there was prejudice evident to the present appellants by the orders which were made in the National Court. Again the assertion barely of prejudice does not demonstrate an error of principle. It is then said that the application for stay was incompetent but the court had jurisdiction under s 19 of the Supreme Court Act to grant a stay and did so on application.
  12. Whatever error in practice there was, in terms of the invocation of that jurisdiction, was within the remit of the single judge to cure if need be. That “there was jurisdiction” means that the application itself was competent. The Court had jurisdiction to grant a stay. It is evident from the material before us that there is quite some controversy as between the parties in relation to whether their agreement is at an end. But the national justice system does not start and finish with the National Court. The appellants have invoked a right of appeal to this Court. Where the merits lie is now a matter for this Court.
  13. There was also something of a plea on behalf of Ngusu for us to make an assessment ourselves as so of the merits as to whether a stay should be granted. For reasons which I have already given, I do not consider that an assessment of the eventual merits is appropriate.
  14. However, even were I to embark upon the course invited, all that would disclose is that there is apparently an imminent risk of the cancellation of a forestry license on the strength of the orders of the National Court. We were told that the learned primary judge did not advert to this particular factor in deciding whether to grant a stay. That may because as was asserted on behalf of Ngusu that the affidavit concerned was either not served or served very late. If I were to look to that affidavit, all that would provide for me is an additional reason why it would be apt to grant a stay.
  15. For these reasons then in my view, the application for the review of the order of 13 July 2022, by which a stay of the orders made in the National Court on 6 June 2022 was granted, should be refused.

COSTS


  1. Having considered the submissions in relation to costs, the Court is of the view that this is not an apt case for the awarding of costs on an indemnity basis. It was not disposed of on the basis of an absence of jurisdiction, such as might be a motivating factor to award costs on an indemnity basis. The Court is disposed to award costs only on a party-party basis. We are not disposed just to make costs in the proceedings. The application was pressed and it was not successful. Costs should therefore follow the event.
  2. ANIS J: I have heard the pronouncement of my president Logan J. I concur with the reasons and conclusions that he has reached and I have nothing further to add.
  3. DINGAKE J: The background to this application has already been set out very eloquently by my brother Logan J. The application concerns the setting aside of a stay order made by Hartshorn J sitting as a single judge of Supreme Court on 13 July 2022.
  4. The grant or refusal of a stay is discretionary. The principles on the grant of stay are set out clearly in that locus classicus case of McHardy v Prosec Security and Communication Ltd [2000] PNGLR 279. The Court can only set aside the stay granted by Hartshorn J if it is established or proven that in granting a stay, the learned Hartshorn J committed an error of principle. None was demonstrated before us. Before us there was no transcript of the proceedings that served before Hartshorn J and this made it difficult to evaluate whether the learned judge committed any error at all that would justify the setting aside of the stay order.
  5. It is for this reason that I agree entirely with the reasoning and conclusion just earlier pronounced by my brother Logan J.

Orders


  1. The application filed on 4 August 2022, seeking to set aside the stay order granted on 13 July 2022, be dismissed.
  2. The respondent (applicant on the application) pay the appellants’ (respondents to the application) costs of the application, to be assessed if not agreed.

__________________________________________________________________
Nelson Lawyers: Lawyers for the Appellants
Emmanuel Lawyers: Lawyers for the Respondent


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