IN THE HIGH COURT OF SOLOMON ISLANDS
(Faukona PJ)

Civil Case No. 241 of 2015

BETWEEN:

ERIC TEMA
First Claimant

AND:

ETH GLOBAL INVESTMENT AND PARTNERS LIMITED
Second Claimant

AND:

ASIA PACIFIC INVESTMENT DEVELOPMENT LIMITED
Defendant

Date of Hearing: 25th September 2015
Date of Ruling: 3rd November 2015.

Mr P. Afeau for the First and Second Claimants
Mr J. Ivanisevic and Ms A. Willy for the Defendant 

RULING ON APPLICATION TO VARY INTERIM INJUNCTION ORDERS

Faukona PJ: This application was filed by the Defendant on 6th August 2015 pursuant to Rule 17:55 of SI Court Civil Procedure Rules 2007 and is purposely to vary the interim injunctive orders granted by this Court on 11th July 2015.

2. Order 1 and 2 can be summarised as restraining the Defendant, its agents, employees, officers, workmen, or invitees from accessing or using the land areas on Rennell Island describe as PNs 298-004-1, 298-004-2; 298-004-3; 298-004-6 and 298-004-7. At the same time restraint from entering and stockpiling of soil, mineral/bauxite on the second Claimant's land PN 298-001-2 until further orders.

Background facts:

3. The first Claimant is an individual and a businessman who dwells at Tahanuku village, West Rennell, Renbel Province. He contends that he is the registered owner of the perpetual estates in the above parcel numbers which were registered on 27th October 2007. 

4. The second Claimant is a company incorporated under the Companies Act by the first Claimant who owns 80% share and is one of the Directors. The Company's main business sector is forestry. The second Claimant contends it is the holder of a registered lease in parcel number 298-001-2, which was registered on 5th June 2014. 

5. The Defendant is a company incorporated under the Companies Act and is a holder of a Mining Lease No. ML: 1/2014, issued on 5th September 2014. Before that, the Defendant had a prospecting licence numbered PL: 04/08 (Prospecting License A) with obligations set out in S. 27 of the Mines and Minerals Act.

6. The land, the road land and the leased land are all within the area the subject of the mining lease and the prospecting license A.

The orders of 11th July 2015:

7. It appears from the facts that the orders of 11th July 2015 were granted premised on the facts that the Claimants are the registered owners of the subject lands and their rights and interests are provided in sections 109 and 110 of the Land and Titles Act (the "Act") and have overriding interest in accordance with section 114 of the Act. As claimed, that must be the ground upon which they contended a trespass had occurred by the act alleged, as being occurred after the issuant of the mining lease. However, the Defendant denies the truth of the matter upon plain reading of the Land and Titles Act.

Rights under the Mining Lease.

8. After being issued with a mining lease, the Defendant then exercise its rights under S.43 of the Mines and Minerals Act, within the area subject to mining lease ML: 1/2014, and may in the exercise of its rights under the mining lease, enter upon the area to carry out mining including right to;

a. Make all necessary excavations to mine the mineral deposit or deposits in the mining area …

b. Erect, construct and maintain in the mining area such machinery and buildings, workshops and other production facilities as may be necessary or convenient for the purpose of mining, storing transporting, and dressing, treating, melting or refining the minerals recovered in the course of mining. 

9. In carrying out necessary work and operation under the mining lease the Claimants alleged that the Defendant since 19th September 2014 been trespassing onto their lands and causing physical and environmental damages to them.

10. They also allege that the Defendant's vehicles have been using and accessing the road on first Claimant's land to carry and transport soil/bauxite from its operation site to the seaport at lughughi bay. Also allege the Defendant had constructed access road and used it for its operation causing damages to the land by doubling the width from three meters to six metres and dagged the land to maintain the road.

11. Further the Claimants allege that the Defendant is stock piling its soil/bauxite on second Claimant's land ready for export and shipment.

12. The claimants are denying given any permission authorized the Defendant to use and access their lands and stockpiled bauxite ore on it. They have requested by letter to cease but the Defendant ignored.

Registered land (rights and interests).

13. Section 109 of the Act provides for registration of owners of perpetual estate, fixed term estates and owner of a lease. S.116 requires every instrument creating, disposing of, charging, extinguishing a registered interest must be registered. Once that has been done interest is thereby conferred. The rights of the registered owners are prescribed in Section 110 of the Act. Section 143 provides that an owner of an estate may lease the land comprised that estate or part thereof for a term determined by the lessor and the lessee, provided it is accompanied by a plan or description adequate to identify the part lease. Registration of leases for more than two years is provided for under S.146 which must be in prescribe form, lease must be filed and register as an encumbrance, see Greenhill Enterprise Limited -V- Pacific Crest Ltd and AG. 

14. Further rights are set out in sections 111, 112 and 113. However, there are exceptions to those rights and interest which S.114 term as overriding interests which for the time being, subsist and affect the same, without they being noted on the register.

15. The cardinal principle as owner of registered land or lease is that the legal interest passes when the disposition has been completed by statutory registration. So a person acquires legal estate or title which he becomes registered and when the relevant documents are delivered to the registry. Once that has been done, the owner takes a good title subject only to subsisting entries as the register as overriding interests set out in S.114.

Rights and interests of parties:

16. There is no doubt, there is evidence in perpetual estate register instruments annexure "ETI" attached to the sworn statement of the first Claimant filed on 19th June 2015 in respect of the seven lands, the subject of this case. The interests in perpetual estates were registered on 29th October 2007 in the personal capacity of the first Claimant in trust for members of his family according to paragraph 6 (a) of his sworn statement filed on 17th September 2015.

17. Likewise there is documentary evidence of a lease for twenty five (25) years in Parcel Number 298-001-2 to the second Claimant. The lease was registered on 5th June 2014, affirmed by annexure "CT2" of the sworn statement of the first Claimant filed on 17th September 2015.

18. Equipped with the documentary evidence, the Claimants vehemently affirm their status as registered owners of the perpetual estate and lease, and acclaim they are protected by sections 109 and 110 of the land and Titles Act.

19. On the opposite, the, the Defendant claims it also has rights under S.43 of the Mines and Minerals Act pursuant to Mining Lease ML: 1/2014 granted to it, and may in exercise of its rights, enter upon the areas the subject of the mining lease to carry out mining including rights to make excavations to mine mineral deposits, stock products or do mineral processing, to conduct and maintain all passageways and conveniences as required to carry out mineral operations. Those are rights relevant to this case.

20. Interestingly the interest and rights of the parties are focussed on one common area which now becomes the subject of this dispute. Also noted from Mr Tang' sworn statement is a registered instrument of a sub-lease to the Defendant dated 24th July 2015.

21. The contentious concern of the Defendant is not so much on the rights conferred to the Claimants by S.110. Even if those rights are accepted as being valid because of their registration does not matter. It is the exceptions to those rights that will resolve this matter and that are the core issues in this case; I will discuss the exceptions later. Therefore attested that the rights and interests of both Claimants are subject to the rights of the Defendant vested on S.43 of the Mines and Minerals Act.

22. From submissions Counsels seem to agree with the laws and their applications. It reflected their full knowledge of which cannot be demurred or undermined.

23. In this case, the Defendant's rights conferred by the Mines and Minerals Act do not include ownership of any land but rights under the exceptional provision (S.43 Mines and Minerals Act) and the sub-lease ownership. The pivotal stand by the Defendant is that the statute had conferred rights to it to enhance development in mining for bauxite resources under ML;1/2014, which entitled it to engage all activities reasonably necessary for carrying out mining operations. 

24. Imperatively, a question to note is, are the rights and interests conferred upon the claimants by the Land and Titles Act was an overriding effect or subjective to the rights conferred upon the Defendant by the Mines and Mineral's Act, or vice versa, in respect of the same subject matter (lands).

25. Here undoubtedly, is a situation where two legal rights are in conflict. The study of law reminds me that in such situation first in time takes precedent over the other; time is of essence in such situation. There may be other interests not being aware of at the time of acquiring interests and rights where personal search and investigation should carry out prior to acquiring the interest in the property to the land.

26. The case of Shell company (Pacific Islands) Ltd V Korean Enterprises Ltd, which His Lordship Muria CJ stated;

"In the context of this case, the words "for the time being" used in S.114(1) should be taken to refer to the particular time when the Defendants acquired their respective registered interest in the land. For the second Defendant, that would be on 8th July 1983 and for the first Defendant that would be 14th July 1999".

27. That statement places the law in its proper perspective. The argument that the words "time being" used in S.114 as making reference to rights and interests that were existed at that point in time the trespasses were alleged to have occurred and the injunction relief was sought. That can be true when the subject matter is related to a point in time when it was realized that there are competing rights. Nevertheless, the above case should settle any ambiguity. In a clear vision, there is no doubt the Defendant's rights were registered late in time, therefore must be accepted as having subjective status and must not be an overriding interest over those of the Claimants. The need to bring about the prospecting licence does not change the circumstances. The moment a mining lease has been issued the prospecting licence becomes redundant.

28. The word "subsisting" used in section 114(1) seem to supporting my view, in the sense that, the rights and interests which were existed at that time when the Defendant acquired its rights which is later in time, makes it subjective to the Claimants rights and interests. Therefore, in my opinion, the interest and rights of the Claimants are overriding, so to say. To allow my view to operate vice versa is contextually inappropriate and out of logic.

29. The nature of rights acquired by the Defendant to be carried out in the Claimants registered land are different in nature and not in the full nature of necessities; they are activities that enhance development which the registered owners who acquired their interests first in time has to consent to; proper word to use is consultation. I appreciate the fact that the Defendant had done it and executed an agreement on 10th February 2015 with Mr Sau'eha the person authorized Mr Tema to deal with the registered land. That diminished Mr Tema's rights and interest to Zero and maintain the Defendants right to continue the mining operations.

31. Despite the fact that the Defendant has subjective rights, does not undermine its operation to an act of trespass which orders were sought to maintain. The Defendant is entitled to perform all the rights under S.43 of the Mines and Minerals Act granted under the mining lease by virtue of the agreement it executed with Mr Sau'eha, the authorised landowner. Those are the rights which precisely are complained of and cannot give rise to any trespass. 

32. As against the second Claimant, the asserted lease claim is far from effective. Initially there is no question about the processes and the manner in which the first registration was done after the lease was acquired. Unfortunately, the second Claimant was removed from the Company haus register on 1st May 2012 for failure to file 2011 annual return. Consequent to that, the lease was terminated on 28th February 2014 and was granted to Pacific Crest Enterprises Limited on 6th March 2014, subsequently was stamped on 12th March 2014. 

33. The effect of removal is addressed by section 152(1) of the Companies Act which provides that during the period of removal, the property of the company was vested in the Crown pursuant to section 145 of the Companies Act. In any event, should the Company is re-registered under section 151 (2) of the Act, the property is vested back on the Company as if the Company has not been removed from the register. 

34. There is clearly no evidence, documentary or otherwise, that the second claimant was re-registered. Therefore, there cannot be a re-vestment of its interest and rights. Perceivably the status of the second Claimant during the period of removal is no longer a legal entity to sue or be sued in its legal capacity. In the case of T.W. Transport Ltd V Maru, the National Court of PNG adopted the decision of the Supreme Court in AC Guard Dog Security Services Ltd V Lindsay Lailai where it was held amongst others, that the appellant was not incorporated as a company, has no legal standing and is therefore incompetent to institute an appeal. 

35. The PNG National Court also adopted the decision in NSW Supreme Court of Unlimited Insurance Co. Ltd (in fig) V Long where the Court stated;

"…. A non-existent person cannot sue. In this case of a natural person. The English Courts would decline to entertain an action in his name.

36. In this case, the case authorities enumerated, so plain that the second claimant being not re-registered, therefore, not in existent and cannot sue, it has no standing. 

37. Because the second Defendant had died a natural death, the Provincial Executive proceeded to terminate the unregistered lease of lughughi land on 28th February 2014, see annexure "LT4" attached to Mr Tagosia sworn statement filed on 7th August 2015. That paved the way for the Renbel Provincial Executive to enter into a new lease agreement with Pacific Crest Enterprises Limited on 6th March 2014. 

38. Despite what actually transpired, the first Claimant still argues that there was no Executive or Assembly resolution regarding the termination of the lease. The question whether the lease was terminated or not, does not change the circumstances, the second claimant was never re-registered, there is no evidence to proof, all its properties are automatically vested in the Crown pursuant S. 152(1) of the Companies Act. Plainly, the second Claimant owns nothing and has no rights and interest in the claimed lease agreement.

Overriding interest:

39. Section 114 of the Land and Titles Act set out the overriding interests. Perhaps the most important and concern interest is in paragraph (a) rights of way. In the case of Korean Enterprises Limited-–V- Premier for G. Province and Shell Company (Pacific Islands) Limited, which the Court of Appeal emphasize the importance of overriding interest. It stated on p.2 para 5;

"The dominant feature of the Torrens system is that, once registered, the interest of the owner of an interest in land is held indefeasibly; that is, subject only to such other interests as are registered in respect of it, but free from all other interests that are unregistered.

In the case of the Land and Titles Act, these principles are given effect of sections 109 and 110 of the Act. The Torrens legislation nevertheless recognises the existence and subsistence of various identified rights and interests even though they are not registered, S.114 of the Act describes them as overriding interests and, in specifying what they are in subsection (a) rights of way, rights of water, easements and profits subsisting at the time of first registration under this Act"

40. S.115 (1) provides that all interest in land including customary land, is subject to implied rights that any person who is the owner of an estate, lease, occupier of adjoining land, or neighbourhood who has not access from his land, that is to say, road, way, river, creek or foreshore shall have right of way for all reasonable purposes over such land and to pass and repass with or without vehicles. By subsection (2) if the persons cannot agree among themselves to the location and conditions of or incidental to right of way, the Commissioner shall decide the matter. S. 133 of the Act clearly specifies that all existing roads and rights to use them shall remain free and uninterrupted unless close or altered with the consent of the Commissioner.

41. There is argument that S.133 is inappropriate. That, in my opinion is a misconception of the law. Section 60 of the Land and Titles Act states that purchase or lease of customary land can be done by the Commissioner or any Provincial Assembly. If a Provincial Assembly can have same power as Commissioner to acquire by purchase or lease then inferably that should also apply in S.133. S.133 merely talks about transfer or grant. If Provincial Assembly can purchase or lease customary land then of course by virtue of s.133 it can transfer and grant as well and also can determine by consent to close or alter any existing road and rights to use the same, otherwise they shall remain free and uninterrupted. 

42. The question whether a road is a public road or private, S.4 of the Land and Titles Act define road as including "public road." In the case of William Taylor V John and William Hamilton, the Court said in Page 302 paragraph 2,

"I see nothing, therefore, at common law to exclude the public road; and I have already noticed, that I can find nothing in the statutes to warrant the defenders in excluding the pursuer from the use of the road"

43. In this instance there is common knowledge that lughughi road was constructed by Mitsui Co. prior to any of the lands, road land or lease land becoming registered. From henceforth the road has been used by all. When the road land and lease land became registered, the registered owner was well versed of its existence and took that land subject to it being there and rights to use it.

44. Further to that, a road is described as private road if the owner of the road land can able to control and secure. For instance excluding whomever if wishes and demand ransom from whomever he desires to cross. This is strange and a new twist and behaviour in this country particularly in a rural setting.

45. It is pertinent to point out by referring to paragraph 14 of Mr Sau'eha sworn statement filed on 13th July 2015, which he stated, the first Claimant was present at the meeting they held in 2014 in the Community village hall. The concern is a need to construct a short cut road to lughughi bay by the Defendant. The first Claimant was present at the meeting which they agreed including Mr Tema on the road being constructed. Thus 900 meters road was constructed by the Defendant through perpetual estate 298-001-2.

46. Beside all that, the authority vested upon Mr G. Sau'eha by E. Tema, by way of a letter dated 10th February 2009, gave right to Mr Sau'eha and his sons to make decisions and other things they want on the road as they are the true landowners. That was after the perpetual estates were registered on 29th October 2007. In plain English Mr. E.Tema has no right to claim ownership, interfere, and claim for trespass from the Defendant. His rights even under the perpetual estate had been relinquished. In substitution, Mr Sau'eha had executed a Head Agreements with the Defendant for the use of the bay on 27th October 2014 and for exclusive use of the land on 10th February 2015 concludes it all. The injunction relating to the use of lughughi road ought never to have been made.

Orders:

1. Orders on 11th July 2015 are hereby set aside with costs on standard basis.

2. Cost and damages sustained as result of the orders be awarded to the Defendant to be addressed and assessed.

The Court.