Maningelea v Ross Mining Ltd [1997] SBHC 57; HC-CC 168 of 1997 (19 December 1997)

HIGH COURT OF SOLOMON ISLANDS

Civil Case No. 168 of 1997

JOHN MANINGELEA & OTRS

-v-

ROSS MINING LIMITED AND OTRS

Before: Palmer,lmer, J

Hearing: 7th October, 1997 - Ruling: 19th December, 1997

Counsel: R.V. Gyles QC; Jriffiths and AndreAndrew Radclyffe for the Applicants/First and Second Defendants; B. Titiulu for the Third Defendant; D. Mcquire for the Fourth Defendant; C. Ashley for the Respondents/Plaintiffs

PALMER J.:

There are two summons in this case. The first is a summons to strike out dated 20th August, 1997, whilst the second seeks orders from the Court that the Plaintiffs' Solicitor produce evidence of his retainer.

The Respondents/ Plaintiffs claim in this action can be summarised as follows:

(a) This relates to the Compensation Agreement dated 4th October, 1996 entered into between the First, Second and Fourth Defendants. The validity of this Agreement is challenged on a number of grounds. These included allegations that the said Agreement contained no enforceable rights (paragraph 12); that the compensation contained therein was illusory (para. 14); that false representations had been made (paras. 15 and 16); allegations of unconscionability (paras. 14-20); and failure to compensate secondary right holders (para. 2 1).

(b) The second matter challenged relates to the Head Leases in respect of the Gold Ridge Mining Lease Area ("the Land"). The Head Leases were obtained by the Commissioner of Lands from owners of the 25 perpetual estates granted in the Land. The Head Leases are alleged to be void or not binding on the Plaintiffs on various grounds, including allegations of absence of reasonable compensation paid to persons represented by the Fourth Defendants (paragraph 24(a)); no compensation paid to secondary right holders (paragraph 24(b)); allegations of absence of access to independent legal advice (paragraph 24(c)); alleged non-compliance with section 32(4) of the Mines and Minerals Act 1990 (paragraphs 26-27); and unconscionability (paragraphs 28-29).

(c) The Sub-Lease in the Land granted by the Commissioner of Lands to the Second Defendant is also challenged on the same grounds as the Head Leases.

(d) The Mining Lease in respect of the Land is alleged to be invalid as a result of the invalidity of the other instruments and also as being in breach of section 36(a) of the Mines and Minerals Act 1990 (paragraphs 34-36).

The application to strike out is based on two main grounds:

(a) that none of the Plaintiffs is a party to the Compensation Agreement and, therefore lacked any standing or entitlement to challenge the validity of that Agreement in the manner pleaded in the statement of Claim; and

(b) that the effect of registration under the Land and Titles Act of the Head Leases, the Sub-Lease and the Mining Lease is to confer indefeasible rights on the owners of those rights, which owners include the Second Defendant. Those rights are incapable as a matter of law of being defeated by the customary law rights and interests pleaded by the Plaintiffs.

As to the rights of the Plaintiffs to challenge the validity of the Compensation Agreement, it is trite law that only parties to the Compensation Agreement can seek to enforce the terms of such an Agreement or to challenge its validity. It is clear the Plaintiffs are not parties to the said Agreement. All that they have alleged in their Statement of Claim is that they have customary interests or rights over the said Land. At the most, this amounts to a mere assertion because in contrast, the Second Defendant relies on the Sub-Leases granted to it by the Commissioner of Lands on or about 12th March, 1997. The Commissioner of Lands in turn had acquired Leases from the registered joint owners of the 25 perpetual estates of the said Land. The Plaintiffs therefore face an uphill and formidable task to challenge the registered rights and interests of those joint owners. The mere fact that they allege they have an interest or right over the said Land does not entitle them per se to challenge the validity of the Agreement. They will have to challenge the title of the joint owners of the said Land first under the provisions of the Land and Titles Act, and only if successful, can they in turn challenge the validity of the Compensation Agreement. I find with respect this claim of the Plaintiff as disclosing no reasonable cause of action and should be dismissed.

On the question of registration under the Land and Titles Act, the submission by the Applicants that none of the Plaintiffs has any right or interest in the Land which is capable of defeating the rights and interests acquired by virtue of registration poses a formidable hurdle for the Plaintiffs to overcome (in particular see sections 100 and 104 of the Land and Titles Act). Not only that, but the grounds on which such rights can be challenged are limited to the provisions of the Land and Titles Act, in particular section 209. None of those grounds are relied on in this case.

At paragraph 24(a) of the Statement of Claim, it is alleged that the head lease agreements were invalid in that it made no provision for the payment of reasonable compensation to the persons represented by the Fourth Defendant. With respect I fail to see how this can be relied on as a ground for invalidity of the head lease agreements when none of the persons represented by the Fourth Defendant have sought to raise even a murmur on the question of reasonable compensation. What is even more surprising is that the Fourth Defendants are not joined with the Plaintiffs in this action. If the persons represented by the Fourth Defendants are dissatisfied with the question of reasonable compensation then it is a simple matter for them to raise the matter with the Fourth Defendant to take up the issue with the relevant parties.

Sub-paragraph 24(b) alleges invalidity in that the agreement did not contain any provision for payment of compensation to the persons having secondary rights to the said Land. Again this is a simple matter for the persons claiming secondary rights and entitlements to compensation to take the matter up under the provisions of the Land and Titles Act. The absence of any terms of payment of compensation to persons claiming secondary rights cannot be a ground for invalidating a valid agreement entered into by persons deemed in law to be the correct and rightful persons to enter into such an agreement. In order to successfully challenge the validity of the Agreement the Plaintiffs will have to show first of all that the persons who have entered into those head lease agreements are not the right persons to do so. Unless and until that is done, the Plaintiffs do not have a hope of successfully challenging the validity of the said Agreement with respect.

The third ground relied on was that the joint owners who entered into the head lease agreement did not have access to any independent legal advice. Surprisingly, none of those joint owners have been joined as Plaintiffs to support this claim. I find this ground devoid of any merit and with respect, frivolous and vexatious and ought not to have been raised by the Plaintiffs. The question of access to independent legal advice is a matter within the discretion of the joint owners. If they chose not to get independent legal advice then what is that to do with the Plaintiffs?

The arguments in respect of the head leases must also apply to the submissions raised in respect of the challenges to the validity of the sub-leases granted by the Commissioner of Lands to the Second Defendant.

Finally the issues raised as to the validity of the Mining Lease. At paragraph 35 of the Statement of Claim it was contended that the Mining Lease granted to the Second Defendant by the Minister was invalid and ineffective in that:

(a) no surface access rights had been obtained by the Second Defendant at the time of the application for the mining lease; and

(b) there was no basis upon which the Minister could properly be satisfied that the Second Defendant had acquired surface access rights over the Mining Lease Area.

With respect I also find this ground to be devoid of merit, frivolous and vexatious. The facts speak for themselves. What other surface access rights do the Second Defendants need when it is clear on the facts that the registered joint owners of the 25 perpetual estates of the said Land had already granted the Head Leases in respect of the Land in favour of the Commissioner of Lands on or about 10th March 1997, and who in turn on 12th March, 1997, had granted the Sub-leases in respect of the Land in favour of the Second Defendant. It couldn't be any clearer. There was ample basis on which the Minister could be satisfied that surface access rights had been acquired and to issue the Mining Lease to the Second Defendant on 12 March, 1997 to the Second Defendant. Until and unless title to the 25 perpetual estates is successfully challenged under the Land and Titles Act, the Minister is entitled in law to rely on their validity and to act accordingly.

I am satisfied the claim of the Plaintiffs discloses no reasonable cause of action as well as being frivolous and vexatious and must be dismissed.

This brings me to deal briefly with the question of Retainer. In Civil Case 169/97, Mr Radclyffe had deposed in his affidavit sworn 20th August, 1997 which contained his letter to the Plaintiffs solicitor dated 7th August, 1997 in which he stated that he believed there were a number of persons included in Schedule B to the Statement of Claim which had not granted their authority or consent to be represented by the Solicitor in that case. Based on that belief and the fact that the Solicitor in that case had objected to any approaches to be made to any of the Plaintiffs it was argued in this case as well that serious questions arise as to whether Mr Ashley had been properly retained by each of the nominated Plaintiffs.

With respect, whilst I appreciate that serious questions may be asked, unfortunately, that is as far as the Applicants in this case can go. There is no other evidence to support their assertion that the Plaintiffs in this case had not properly instructed and retained learned Counsel, Mr Ashley to represent them. As in civil case 169/97, the proper course would have been to require Mr Ashley to produce his authority to act for the Plaintiffs within a set time, failing which the proceedings could be dismissed or stayed as against those persons where no authority can be produced. That however is not necessary in view of the ruling of this court to strike out the Plaintiffs claim as disclosing no reasonable cause of action.

ORDERS OF THE COURT:

1. Strike out pleadings of the Plaintiffs sclosing no reasonable cause of action and as bein being frivolous and vexatious and an abuse of the Court's process.

2. Consequently order that the action be dismissed with costs.

ALBERT R. PALMER
THE COURT