Mineral Resources Development Co Ltd v Melanesian Trustee Services Ltd [2024] PGSC 8; SC2536 (28 February 2024)

SC2536

PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]

SCA 49 OF 2019

BETWEEN:
MINERAL RESOURCES DEVELOPMENT COMPANY LIMITED
Appellant

AND:
MELANESIAN TRUSTEE SERVICES LIMITED
First Respondent

AND:
MATHEW DAMARU, the Director Papua New Guinea Royal Constabulary National Fraud and Anti-Corruption Directorate
Second Respondent

AND:
GARY BAKI, the Commissioner of Police
Third Respondent

AND:
THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Fourth Respondent

Waigani: Logan J, Anis J and Narokobi J
2024: 28^th February

PRACTICE AND PROCEDURE – Where the first respondent made complaints alleging criminal conduct on behalf of the appellant to the second and third respondents – where the second and third respondents commenced criminal investigations into the conduct of the appellant – where the appellant commenced proceedings seeking declarations that the conduct subject to the investigations was not unlawful – where the proceedings were dismissed at first instance as an abuse of process – whether civil proceedings can be used to interfere with criminal investigatory processes and criminal justice processes – appeal dismissed

The appellant and the first respondent are both associated with the Pacific Balance Fund. The first respondent made complaints about the conduct of the appellant to the second and third respondents. The complaints sought a criminal investigation, and potentially related charges, into the conduct of the appellant. The second and third respondents commenced investigations. The appellant instituted National Court proceedings seeking declarations that essentially declared that its conduct was not unlawful. The National Court at first instance dismissed the proceeding as an abuse of process by applying the principles in Wartoto v The State [2015] PGSC 1, SC1411.

Held:

1. The proceedings were an abuse of process, as the declarations sought to interfere with and curtail the ordinary criminal investigatory and criminal justice processes and no exceptional circumstances existed which warranted intervention by a court exercising civil jurisdiction.
   

Cases Cited:
Wartoto v The State [2015] PGSC 1; SC1411

Counsel:
Ms. Kumo, for the Appellant
Mr. Goodwin, for the First Respondent
Ms. Ohuma, for the Second, Third and Fourth Respondents

Oral decision delivered on
28^th February 2024

1. LOGAN J: On 10 November 2017, the first respondent, Melanesian Trustee Services Limited (MTSL), by its then executive chairman, Mr John Sanday, wrote a letter to the then chief superintendent director of the National Fraud and Anti-Corruption Directorate, Chief Superintendent Mathew Damaru, of the Royal Papua New Guinea Constabulary.
   
2. By that letter, MTSL made a complaint against two individuals named in that letter associated with a company which is not a party to the present proceedings as well as seeking investigation and the laying of any appropriate charges against the appellant, Mineral Resources Development Company Limited (MRDC). That letter of complaint was a sequel to a resolution of MTSL’s board that such a complaint should be made. The letter set out, in some detail, why it was that the police ought to investigate MRDC as well as that other company.
   
3. The response to that by MRDC was to file and serve on MTSL, Chief Superintendent Damaru, the Commissioner of Police, and the State an originating summons by which it claimed the following relief:
   

“(1) A declaration that a person with the relevant interest can lodge a complaint of a breach of the Securities Commission Act 2015 and Capital Markets Act 2015, amongst others, with the Securities Commission to trigger investigations under Part V of the Securities Commission Act 2015.

(2) A declaration that such a complaint with the Securities Commission of Papua New Guinea (the Commission) is for the Commission to conduct its lawful duties hence does not constitute a crime known to law.

(3) A declaration that the Plaintiff’s letter dated 09 October 2017 to the First Defendant and the Plaintiff’s letter of complaint dated 20 July 2018 to the Commission does not constitute a crime known in law.

(4) A declaration that the Trust Deed dated 22 October 2001 establishes a contractual relationship of which fundamental principles of freedom of contract apply.

(5) A declaration that the complaint raised by the Plaintiff in its letter dated 09 October 2017 to the Plaintiff and the letter of complaint dated 20 July 2018 and the resultant actions undertaken by the Second Defendant and his agents and servants, has the dominant purpose of intimidating, forcing and subduing the Plaintiff and other parties to the Trust Deed to remain the contract.

(6) A declaration that the complaints laid by the First Defendant dated 10 November 2017 to the Second Defendant against the Plaintiff and its servants and agents, instigating the criminal process for an improper cause is a gross abuse of authority and process.

(7) A permanent injunction restraining the Defendants, their agents and servants, from taking any action, criminal or otherwise, in connection with or in reaction to, any exercise of legitimate interest as a unit holder pursuant to the Trust Deed and the relevant laws.

(8) An Order in the nature of an interim injunction be granted restraining the Defendants and their servants and agents from arresting, threatening and intimidating the Plaintiff, its Board of Directors, its servants, agents and associates in relation to matters relating to or in connection with the First Defendant’s Complaint letter dated 10 November 2017 or any matters in relation to the Pacific Balance Fund.

(9) The Defendants pay the Plaintiff’s costs of and incidental to this proceeding.

(10) Such further or other orders that this Honourable Court deems fit.”

4. Eventually, that originating summons proceeding came before the National Court on 5 March 2019. At that time, for reasons delivered ex tempore, the learned primary judge dismissed the proceeding.
   
5. His Honour did so for three reasons:
   
   1. A characterization of the proceeding as an abuse of process in that it sought to invoke the Court’s civil jurisdiction to interfere with the ordinary course of a criminal investigatory process;
   2. An absence of compliance with section 7 of the Attorney General Act 1989 by the absence of any evidence commissioned of the Attorney General to initiate the proceeding; and
   100. A failure to give notice to the State pursuant to what the primary judge apprehended to be a need so to do arising from section 5 of the Claims By and Against the State Act 1996.
        
6. In characterizing the proceeding as an abuse of process, his Honour considered that the case was one which fell within the statements of principle made by this court in Wartoto v The State [2015] PGSC 1, SC1411, with respect to when it was appropriate for a court exercising civil jurisdiction to entertain a proceeding seeking to truncate the ordinary criminal investigatory and criminal justice processes.
   
7. MRDC now appeals against that order of dismissal. In essence, it submits that on each of the learned primary judge’s bases of dismissal mentioned, the learned primary judge was in error. It also seeks to raise what, with respect, are some quite inconsequential and supremely distracting issues of practice and procedure.
   
8. As to the relief which was sought in the originating summons, it is obvious enough from the evidence which was before the primary judge that there was a difference of view between MRDC and MTSL concerning the administration of a trust, but there was never any gainsaying by MTSL of an ability on the part of MRDC to make such complaint as it might be advised alleging a breach of the Securities Commission Act 2015 or the Capital Markets Act 2015 with the Securities Commission concerning the administration of the trust. To that extent, the relief sought in paragraphs [1] and [2] of the originating summons raise hypothetical questions. By that, I mean there was no underlining controversy as to the ability of MRDC to make a complaint.
   
9. Further, whether or not there was any substance in a perception by MRDC concerning the administration of the trust could have been dealt with by way of a proceeding in the National Court’s equity jurisdiction concerning the administration of the trust.
   
10. As it was, the relief sought in the originating proceeding, considered as a whole, seems to me to be nothing more and nothing less than responsive to the letter of complaint to the police of 10 November 2017. That being so, the learned primary judge was, in my view, correct to regard the proceeding as nothing more than an endeavour to interfere with the making of value judgments in the ordinary way by the police in the course of deciding whether or not to initiate, and if so to what extent, a criminal investigatory process which may or may not have yielded criminal charges.
    
11. As Wartoto concedes, in exceptional circumstances a court exercising civil jurisdiction might enjoin the furtherance of a criminal investigation. But in the ordinary course, an endeavour to invoke the court’s civil jurisdiction to interfere with a criminal investigatory process or an exercise of criminal jurisdiction is an abuse of process.
    
12. Where a criminal jurisdiction has been invoked in the ordinary course of events, it is for an aggrieved party to make such submissions as that party may be advised to the court in the exercise of its criminal jurisdiction as to whether or not a particular criminal proceeding was or is an abuse of process. Here, at an anterior stage, MRDC has sought, in effect, to use the Court’s civil process as what might be termed a pre-emptive strike.
    
13. It was, in my view, an entirely orthodox application of the principles stated in Wartoto for his Honour to characterise the proceeding as an abuse of process and to dismiss it accordingly.
    
14. In light of that conclusion, it is in my view unnecessary to consider whether or not the learned primary judge was correct to regard the proceeding as one which required the permission of the Attorney General under the Attorney General Act.
    
15. Further, for the same reason (in other words, because there was in any event a perfectly sound basis for dismissing the proceeding on the basis that it was an abuse of process), it is in my view unnecessary to decide whether or not MRDC needed first to give notice pursuant to section 5 of the Claims By and Against the State Act.
    
16. In summary, the case was one aptly dismissed as an abuse of process by a court bound to follow statements of principle with respect to the exercise of civil jurisdiction where a criminal investigatory process had been sought to be invoked.
    
17. I would also observe that it is somewhat surprising that, in respect of a complaint made to the police as long ago as 2017, and dismissed in 2019, MRDC considered that there could be any possible utility in the furtherance of a proceeding in the National Court in any event, even had there been any merit in any of its ground of appeal.
    
18. I would therefore dismiss the appeal.
    
19. ANIS J: I have had the opportunity of listening to my brother judge, Justice Logan, in relation to his reasoning and the decision to dismiss the appeal. I am in agreement with my brother judge, and I have nothing further to add.
    
20. NAROKOBI J: I agree with the decision of my brother judges that the appeal must fail.
    
21. I reiterate that the proceeding is an abuse of process, and the appellant has not shown by evidence or case authority that this is a case that falls within the exceptions in Wartoto v The State [2015] SC1411.
    
22. In that case, for the appellant to succeed, they must show that this is a clear case for abuse of process. I do not see this as one that falls within that exception and I reiterate what my brother judge, Justice Kirriwom said in the Wartoto case that there is an abundance of measures within the criminal justice process to protect the appellant’s rights. If indeed the appellant is concerned about its rights, the criminal justice process affords the appellant rights to secure its interests. So, by dismissing the appeal, the appellant’s rights are not in any way affected from being defended in an appropriate process.
    
23. This is also compounded by the fact that this appears, from the submissions of counsel and considering the materials before the Court, to be a hypothetical case, an academic exercise if you will.
    
24. Questions relating to the application of the Claims By and Against the State Act are important, but as the appeal turns from the question of whether the primary judge was correct in deciding the question of whether it is an abuse process, I will not venture into considering these questions at this time.
    
25. I would therefore order that the appeal is dismissed.
    

Orders

1. The appeal be dismissed.
2. The appellant pay the costs of, respectively, the first respondent and the second, third and fourth respondents, to be taxed if not agreed.

__________________________________________________________________
Jema Lawyers: Lawyers for the Appellant
Goodwin Bidar Nutley Lawyers: Lawyers for the First Respondent
Solicitor-General: Lawyers for the Second, Third and Fourth Respondents