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Genia v Popoitai [2024] PGSC 2; SC2528 (29 January 2024)

SC2528


PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]


SCM NO. 27 OF 2023


ELIZABETH GENIA as the Acting Governor of BPNG
First Appellant


TAU VINI as the Secretary of the Board of Directors, Bank of Papua New Guinea
Second Appellant


DAVID TOUA as the Chairman of the Board of Directors, Bank of Papua New Guinea
Third Appellant


ULATO AVEI as Director of the Board of Directors, Bank of Papua New Guinea
Fourth Appellant


-V-


BENNY POPOITAI
First Respondent


THE OMBUDSMAN COMMISSION OF PAPUA NEW GUINEA
Second Respondent


THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Third Respondent


Waigani: Kariko J, Toliken J and Lindsay J
2023: 1st December
2024: 29th January


JUDICIAL REVIEW – appeal against grant of applications for judicial review – compulsory retirement - Director of the Financial Analysis and Supervision Unit (FASU) – contract of employment – whether retirement ultra vires s 65, Anti-Money Laundering and Counter Terrorist Financing Act 2015 – whether retirement contrary to s 22, Central Banking Act 2000 – whether natural justice denied


The Director of the Financial Analysis and Supervision Unit (FASU) applied in the National Court for judicial review of the decision by Bank of Papua New Guinea (BPNG) to compulsorily retire him after he reached the age of 65 years, principally arguing that his retirement was contrary to s 65 of the Anti-Money Laundering and Counter Terrorist Financing Act 2015 and s 22(1)(c) of the Central Banking Act 2000. The Court upheld the application and granted him the relief sought. The BPNG parties appealed the decision claiming, among others, that the two statutory provisions were erroneously interpreted and applied.


Held:


  1. Under s 22(1)(c) of the Central Banking Act 2000 a person is disqualified from being the Governor or Deputy Governor of the Bank of Papua New Guinea if he is aged 70 years or older.
  2. Pursuant to the Bank of Papua New Guinea’s employment policies, the age for compulsory retirement of officers of the Bank other than the Governor and the Deputy Governor is 65 years.
  3. The Director of the Financial Analysis and Supervision Unit (FASU) is an officer of the Bank of Papua New Guinea.
  4. In the context of employment, “dismissed” is different in meaning to “retired”.
  5. Section 65 of the Anti-Money Laundering and Counter Terrorist Financing Act 2015 deals with dismissal of the Director of FASU and not his retirement.
  6. Appeal upheld.

Case Cited:


Kawaso Ltd v Oil Search PNG Ltd (2012) SC1218
Kekedo v Burns Philp (PNG) Ltd [1988-89] PNGLR 122
Minister for Lands v Frame [1980] PNGLR 433
Popoitai v Genia (2023) N10489
Ramu Nico Management (MCC) Ltd v Eddie Tarsie (2010) SC1075
Sukuramu v New Britain Palm Oil Ltd (2007) N3124
Telikom PNG Ltd v ICCC (2008) SC908


Legislation:


Anti-Money Laundering and Counter Terrorist Financing Act 2015
Central Banking Act 2000
Constitution
Interpretation Act 1975
Supreme Court Act 1975


Counsel:


Mr D Kaima, for the Appellants
Mr A Mana, for the First Respondent
Mr M Kik, for the Second Respondent
Mr K Kipongi, for the Third Respondent

APPEAL


This is an appeal against the grant of an application for judicial review.


29th January 2024


  1. BY THE COURT: On 12 September 2023, the National Court at Waigani upheld an application for judicial review referenced OS (JR) No. 77 of 2023 filed by the first respondent Benny Popoitai (Popoitai) who challenged his compulsory retirement as an officer of the Bank of Papua New Guinea (BPNG) based on his reaching the age of 65 years. Popoitai was at the material time, Director of the Financial Analysis and Supervision Unit (FASU). The decision of the court is published as Popoitai v Genia (2023) N10489.
  2. This is an appeal against that decision filed by the BPNG parties:
  3. The other defendants in proceedings OS (JR) No. 77 of 2023, the Ombudsman Commission and the State, are named as respondents in this appeal.

BACKGROUND


  1. Most of the main background facts disclosed by evidence is not in controversy:

STATUTE LAW


  1. It is appropriate to set out the statutory provisions pertinent in discussing this dispute.
  2. The first is s 22(1)(c) of the CB Act which states:

No person shall be appointed or re-appointed, or continue to hold office, as Governor, or a Deputy Governor, if that person .... is 70 years of age or over. (Emphasis added)


  1. The second is s 65 of the AML/CTF Act which provides the Director of FASU may be “dismissed” by the Governor of BPNG, in consultation with the Commissioner of Police and the Head of the Department of Justice, if the Director:
  2. It is also useful to note these provisions:

CB Act


AML/CTF Act


JUDICIAL REVIEW PROCEEDINGS


  1. In his application for judicial review, Popoitai claimed that the decision to compulsorily retire him was unlawful because:
  2. He sought as principal relief:

  1. Popoitai filed two affidavits in support of his case while the defence evidence comprised affidavits filed by Genia, Vini, and Patrick Kwiwa, Executive Officer to the Governor. In summary, the evidence of each witness considered relatable to the issues on trial was:
Benny Popoitai
He commenced employment with BPNG in 1981, serving as the Deputy Governor Regulations from 2008 to 2015.

He then took up the position of Director of FASU and on 21 July 2020 he signed the Contract for a term of appointment ending 19 January 2024.

While still the Director of FASU he was appointed Acting Governor on consecutive short terms until 22 January 2023.

On 11 January 2023 he turned 65 years old.

He was first notified of the intention to compulsorily retire him by Genia in a letter dated 16 February 2023. He objected and complained to the Ombudsman Commission which issued the Direction to Genia and the Chairman instructing them to refrain from further proceeding against him and to allow him to serve out the term of his contract.

In April, Genia tried to have him charged for misconduct for supposedly being appointed a Director of the PNG Stock Exchange but that was charge was not pursued.

After BPNG requested he vacate the bank’s residence he was occupying, Popoitai complained again to the Ombudsman Commission who caused a letter on 14 June 2023 to the BPNG reminding it of the Direction.

He received a letter dated 30 June 2023 from Genia who advised that the Board had resolved on 15 June 2023 to have him compulsorily retired.

In his letter of response through his lawyers on 12 July 2023, he challenged the decision as ultra vires the CB Act and the AML/CTF Act.


Elizabeth Genia
After Popitai’s term as Acting Governor finished on 22 January 2023, she was appointed Acting Governor in his place.

She informed Popoitai by letter dated 16 February 2023 that as he had reached 65 years of age, he would be compulsory retired in accordance with the R&R Policy.

This action initiated the process for the retirement pursuant to BPNG management policies.

The Contract stated that the provisions of the Bank’s Code of Conduct and the Employee Handbook applied to Popoitai’s employment as the Director of FASU, who is described as an officer of BPNG by s 62 of the AML Act.

Clauses 11.C and 11.E of the Employee Handbook state that the age for compulsory retirement for BPNG employees is 65 years, while clause 11.G notes that all matters relating to retirement shall be dealt in accordance with the R& R Policy.

Popoitai opposed the notice letter of 16 February 2023 as he considered the action to retire him contrary to s 22 of the CB Act and s 65 of the AML/CTF Act.

He referred the matter to the Ombudsman Commission, which then issued the Direction. The Commission appeared to endorse Popoitai’s views on the cited statutory provisions.

She wrote on 19 June 2023 to the Acting Secretary, Department of Justice & Attorney General, and advised of the Board’s endorsement by resolution of 15 June 2023 to compulsorily retire Popoitai.

She advised Popoitai by letter of 30 June 2023 of the Board resolution, and this was followed up by a formal notice of compulsory retirement issued by Corporate Affairs of BPNG on 17 July 2023.
Tau Vini
He is the Corporate Secretary of BPNG.

He produced a copy of the Minutes of the Board Meeting of 15 June 2023.

The Board’s endorsed the decision to compulsory retire Popoitai.

Although the Board had recommended in 2022 for Popoitai to be appointed Governor of BPNG, has was only appointed as Acting Governor for short periods, the last of which lapsed on 22 January 2023.

The NEC then appointed Genia as Acting Governor.

No appointment had been made to the two positions of Deputy Governor which has been vacant since December 2021.

As the Director of FASU, Popoitai was only an officer of the Bank and was subject clauses 11.E and 11.G of the Employee Handbook and the R& R Policy. The applicable compulsory retirement age pursuant to these provisions is 65 years.

The Employee Handbook and the R& R Policy are policies of the Bank which form part of the terms and conditions of the Contract.

The Board’s endorsement of the decision by Genia to compulsory retire Popoitai was consistent with s 16(2) of the CB Act.
Patrick Kwiwa
When the Contract was signed, the term of appointment was based on incorrect information that Popoitai would reach 65 years of age on 19 January 2024.

When it was learnt in February 2021 that the correct anniversary was 11 January 2023, the matter was raised with Popoitai but he avoided resolving the issue resulting in the term of the Contract not being amended.

  1. In his judgment, the trial judge determined that:
  2. The findings in essence upheld the arguments proffered by Popoitai’s counsel.
  3. His Honour thereby ordered that (with emphasis added):

GROUNDS OF APPEAL


  1. The appellants plead several grounds of appeal alleging the trial Judge erred in law or in mixed fact and law in reaching his decision. Summarized, it is alleged that his Honour wrongly determined that:

ISSUES


  1. In our view, the main issues to resolve in this appeal is whether the decision to compulsory retire Popoitai was made contrary to s 22(1)(c) of the CB Act and s 65 of the AML/CTF Act. That is:
  2. The other questions raised by the remaining grounds of appeal are regarded as incidental to the above issues. We anticipate that the answers will necessarily emerge from our decision on the principal issues.

SUBMISSIONS


  1. The appellants contended, as they did in the National Court, that although Popoitai turned 65 years while Acting Governor and therefore s 22(1)(c) of the CB Act applied at that point in time, he could not rely on this provision after his term as Acting Governor lapsed. From thereon, he reverted to being an ordinary officer of BPNG, and as such he was subject to the bank’s management policies including the R&R Policy which set the age for compulsory retirement for its officers at 65 years.
  2. Regarding s 65 of the AML/CTF Act, the appellants stressed that this provision was not relied upon by BPNG in compulsorily retiring Popoitai because it was not applicable, and that he was properly retired pursuant to the Bank’s management policies.
  3. Counsel for Popoitai first urged the Court to note that consistent with s 16(2) of the CB Act and further to s 65 of the AML/CTF Act, any decision to compulsorily retire his client had to be made by the Board. Mr Mana continued that because there is no appeal against the trial Judge’s finding that there was no such decision by the Board, this is determinative of the appeal and the other grounds of appeal which depend on this primary finding are thereby rendered hypothetical and inconsequential.
  4. Counsel then re-presented the same arguments advanced in the trial regarding s 22(1)(c) of the CB Act and s 65 of the AML/CTF Act to advocate that the trial Judge did not commit any error as pleaded.
  5. With respect to the retirement age, it was submitted that the compulsory retirement age applicable to Popoitai is 70 years in accordance with s 22(1)(c) of the CB Act, given that:
  6. It was also contended that the Director of FASU can only be dismissed from the office in circumstances enumerated in s 65 of the AML/CTF Act, and none of the circumstances arose to justify Popoitai’s retirement. Moreover, the procedure for dismissal prescribed in s 65 was not followed, in that the Governor should have first consulted with the State Solicitor (although it is noted the section refers to the Head of the Department of Justice) and the Commissioner of Police.
  7. The Ombudsman Commission made submissions only to explain why it became involved in the case. Counsel for the Commission stressed that the Commission’s main concern in the case was to ensure the work then being undertaken by FASU in conjunction with the Commission was not jeopardized, and therefore it directed BPNG to allow Popoitai to serve out the full term of the Contract. Otherwise, the Commission took no position regarding the appeal.
  8. The State supported the appeal.

CONSIDERATION

  1. Pursuant to s. 6 of the Supreme Court Act 1975, an appeal is by way of a rehearing on the evidence before the appealed court subject to the admission of any fresh evidence, and the Court may draw its own inferences on the evidence.
  2. To succeed on an appeal, the appellant must show that the appealed judge erred by acting on wrong principles, or allowing extraneous and irrelevant matters to guide or affect him, or he mistook facts, or failed to take into account matters which should have been taken into account: Ramu Nico Management (MCC) Ltd v Eddie Tarsie (2010) SC1075; Telikom PNG Ltd v ICCC (2008) SC908; and Kawaso Ltd v Oil Search PNG Ltd (2012) SC1218.
  3. In relation to Popoitai’s preliminary argument, he relied on the following passage in [11] of the judgment:

In summary, these facts do not come out of the application of section 65 “Dismissal of the Director” of the AML&TFA 2015. Let alone section 22 of the CBA. Both Acts of parliament not policies on retirement and retrenchment. And there is no Board resolution to account that the Board had passed such a resolution (sic).

  1. While the remarks are not totally clear, we note that in the immediately preceding paragraphs, his Honour discussed Popoitai’s evidence and arguments on the application of s 22(1)(c) of the CB Act and s 65 of the AML/CTF Act. Given that, we deduce that by the quoted passage, his Honour was stating that there was no Board resolution which referred to or considered these two provisions.
  2. In any case, we note that a copy of the signed official Minutes of the Board meeting of 15 June 2023 was tendered into evidence without objection, and the relevant resolution simply endorsed for management to proceed to compulsorily retire Popoitai. It is therefore not correct to suggest there was no Board resolution.
  3. Indeed, we find the argument by the first respondent at odds with the fact that he sought certiorari quashing the Board’s decision of 15 June 2023, and the primary Judge granted the relief.
  4. Accordingly, we reject Popoitai’s preliminary submission.
  5. As affirmed in many cases including the case of Kekedo v Burns Philp (PNG) Ltd [1988-89] PNGLR 122, judicial review concerns an examination where the decision-making authority may have exceeded its powers, commited an error of law, commited a breach of natural justice, reached a decision which no reasonable tribunal could have reached or abused its powers. Furthermore, a review is not concerned with the reasoning of the authority but with the decision-making process.
  6. In relation to the interpretation of s 22(1)(c) of the CB Act and s 65 of the AML/CTF Act, we consider the provisions must be accorded with their plain and ordinary meaning. There is nothing ambiguous in their reading. We apply the fundamental rule for the interpretation of a statute stated by Wilson J in Wemay v Tumdual [1978] PNGLR 173 at 176:

... the statute should be construed according to the intention expressed in the Act itself. If the words of the statute are themselves precise and unambiguous, then no more is necessary than to expound those words in their ordinary and natural sense. The words themselves are generally the best declaration of the intention of the legislature.


  1. According to s 22(1)(c) of the CB Act, a person is disqualified from serving as Governor or Deputy Governor of BPNG if the person is aged 70 years and beyond, meaning that such person:
  2. Put simply, a person cannot be Governor or Deputy Governor of BPNG if he is 70 years or older. The section applies to persons holding the positions on an acting basis; s 4(b) of the Interpretation Act 1975.
  3. When Popoitai was Deputy Governor, he could have continued in that office until he turned 70 years (on 11 January 2028), but his appointment ended in 2015. After he was appointed Acting Governor on 22 September 2021, he was again eligible to continue in that position until he reached 70 years. However, the acting appointment finally ended on 22 January 2023. After that date, he resumed his position as Director of FASU and thereby returned to being an officer (an employee) of BPNG, and s 22(1)(c) was thence no longer relevant.
  4. In addition, we reject counsel’s submission that s 22(1)(c) applied to Popoitai because Director of FASU is equivalent in level to Deputy Governor. The positions may well be equal in level but s 22(1)(c) only refers to the positions of Governor and Deputy Governor and no other.
  5. It is obvious from our discussion that his Honour was also wrong to suggest that Popoitai should have been permitted to continue as Director of FASU until the expiry of his term of employment under the Contract.
  6. In the result, we find the trial Judge erred in fact and law in concluding that s 22(1)(c) entitled Popoitai to continue employment with BPNG until he reached 70 years.
  7. Turning to s 65 of the AML/CTF Act, the provision clearly deals with circumstances whereby the Director of FASU may be dismissed, and these include him:
  8. Undisputedly, none of these situations existed and so BPNG, its Board and Genia correctly had no regard to the provision, nor did they purport to rely on it. Moreover, the terms “dismissed” and “retired” are distinct and have different meanings in the context of employment. Cannings J suggested in Sukuramu v New Britain Palm Oil Ltd (2007) N3124 that the term “dismissed” means the same thing as “sacked”, “terminated”, and “fired”. We agree and add that ordinarily an employee is “dismissed” for an alleged wrongdoing while he may be “retired” due to age limitation.
  9. In our view, the learned trial Judge incorrectly characterised “retired” as being the same as “dismissed” which, with respect, led his Honour to err in deciding that the requirement for consultation under s 65 of the AML/CTF Act applied and should have been followed by the appellants.
  10. We maintain there was no legal obligation for Genia, as Acting Governor, to first consult with the Commissioner of Police and the Head of the Justice Department to compulsorily retire Popoitai. Instead, we hold that the Bank properly acted in accordance with the Bank’s management policies relating to retirement, particularly the Employee Handbook and the R& R Policy.
  11. Clause 1.1(g) of the Contract states that these policies form part of the terms and conditions of the Contract.
  12. Clause 2 of the Employee Handbook declares that it outlines the policies regarding employment with BPNG and notes that these may be supported by specific policy documents. Pursuant to clause 11.C of the Employee Handbook (and re-stated in clause 12.C), the compulsory age for retirement for an employee of BPNG is 65 years. The process to effect retirement is provided for in the R&R Policy; clause 14.
  13. Clause 4 of the R&R Policy defines “retrenchment “to mean termination of services, and “termination” includes retirement. By necessary implication, 4 months’ notice is required to effect retirement; clause 16.
  14. It is significant to note that the procedures under the policies were not challenged as a ground for judicial review.
  15. We determine that the decision of the trial Judge based on s 65 of the AML/CTF Act was wrong in fact and law.
  16. Consequent to our views on the two main issues in this appeal, we deem the other grounds of appeal in favour of the appellants for these short reasons.
  17. In our opinion, the first respondent was not denied natural justice. He was notified as early as 16 February 2023 that he had reached 65 years, and he would be duly processed for compulsory retirement. He resisted that by relying on s 22(1)(c) of the CB Act and s 65 of the AML/CTF Act - a position he persistently maintained until he was formally advised of the Board’s decision through Genia’s letter of 30 June 2023 and thereafter.
  18. We also find it irrelevant to the issues at the trial that BPNG (through Genia and the Chairman) ostensibly breached the Constitution in not complying with the Directives of the Ombudsman Commission. Any alleged breach of the Leadership Code for the non-compliance was and is a matter between the Commission and the Bank officials against whom the Direction was issued, the Chairman and Genia. Furthermore, BPNG was not legally bound by any opinion of the Ombudsman Commission regarding the application of s 22(1)(c) of the CB Act and s 65 of the AML/CTF Act or the enforceability of the Contract.
  19. Ultimately, we conclude that BPNG through the Board and its Acting Governor acted appropriately under the Bank’s employment policies to compulsorily retire Popoitai. They did not exceed or abuse their powers, nor did they act unreasonably as alleged by him and accepted by the trial Judge.

ORDERS


  1. In disposing this appeal, we consider it appropriate to exercise our powers under s 16(b) and (c) of the Supreme Court Act 1975 to set aside the decision of the trial Judge and give judgement that ought to have been given.
  2. We accordingly order that:

________________________________________________________________

StratServ Legal: Lawyers for the Appellants

Allan Mana Lawyers: Lawyers for the First Respondents

Ombudsman Commission Legal Counsel: Lawyers for the Second Respondent

Office of the Solicitor General: Lawyers for the Third Respondent


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