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Nesa v Mas Solo Investment Ltd [2019] SBHC 58; HCSI-CC 492 of 2017 (31 July 2019)

HIGH COURT OF SOLOMON ISLANDS


Case name:
Nesa v Mas Solo Investment Ltd


Citation:


Date of decision:
31 July 2019


Parties:
Mayson Nesa v Mas Solo Investment


Date of hearing:
6 November 2018 ( Oral Closing submission


Court file number(s):
CC 492 of 2017


Jurisdiction:
Civil


Place of delivery:



Judge(s):
Keniapisia; PJ


On appeal from:


Order:
Defendant was in breach of the terms and condition of its felling license, those terms and conditions incorporating the May 2002 code, by intruding into buffer zones and in particular K river
Award damages of $3,2000,000.00 to the claimants for harm caused to their livelihood by defendant’s failure to adhere to its statutory duty not to intrude into buffer zones
Costs against defendant plus interest


Representation:
Mr. A Radclyffe for the Claimant
Mr. D Marahare for the Defendant


Catchwords:



Words and phrases:


Legislation cited:
Environmental Act 1998,s17, Forest Recourses and Timber Utilization Act, Cap 40


Cases cited:
Cychen & LC Trading Co. Ltd v Bisivotu Enterprises[2017] SBCA 11

IN THE HIGH COURT OF SOLOMON ISLANDS
CIVIL JURISDICTION


Civil Case No. 492 of 2017


MAYSON NESA
(As representing of residents of Galatha, Momotu and Riusisi Villages. Hograno District, Isabel Province)
Claimant


V


MAS SOLO INVESTMENT LIMITED
Defendant


Date of Hearing: 6 November 2018 (Oral Submission)
Date of Judgment: 31 July 2019


Mr. A Radclyffe for the Claimant
Mr. D Marahare for the Defendants

JUDGMENT

  1. Claimant, an elite of Galatha village, Hograno district, Isabel Province, sues the defendant in his personal and representative capacity. In his representative capacity, he brings this class action for and on behalf of 3 villages in Hograno district namely: Galatha, Momotu and Riusisi villages. The representative class action alleged, that defendant’s logging operations on Gonogano Block B (GBB) caused environmental damage to the livelihood of the 3 villages. And seek compensation for the harm caused to their livelihood. The 3 villages are situated within defendant’s GBB concession land, under felling license A101174, on an area of land locally known as Bobokana.
  2. Claimant do not dispute that defendant has a valid felling license to carry out logging on GBB. Claimant’s case is for compensation for environmental damage, defendant’s logging operations caused to the 3 village’s livelihood that depends on the damaged environment. The environmental damage complaint of arose out of serious breaches of condition 6, of the felling license. Condition 6, obliged the defendant to conduct its operation in a manner that complies with the Revised Solomon Islands Code of Logging Practice, May 2002. Claimant produced evidence of the said breaches through an environmental assessment report, prepared by Mr. Robson Hevalao.

Issues

  1. The issues for determination in this case are:-
  2. Claimant produced evidence of his claim that he represents the residents of the 3 villages. There is uncontested evidence that the villagers support this proceeding, at pages 12 - 18 of Agreed Bundle of Documents (ABD). Elsewhere, the court has seen evidence of the residents of these 3 villages make protests[1] to the defendant, on their environmental damage concerns. Claimants have also raised complaints to the Commissioner of Forest (COF)[2]. The COF had suspended the license[3], but over turned on appeal to the Minister[4]. The area of concern to the 3 villages/claimants is Bobokana, within GBB. I am satisfied Mr. Nesa’s assertion that he represents the 3 villages is established – pursuant to Rule 3.42. Claimant has standing to represent the 3 villages. This resolves Issue No (v).0
  3. Counsel for the defendant raised the issue, whether claimants/3 villages can claim for damage to Bobokana area when dispute over the area is still outstanding. But defendant does not produce contradictory evidence that the villagers do not come from the 3 villages, in the face of clear evidence that claimants produced, saying they come from the 3 villages (pages 12 – 18 ABD). I take implied notice from the evidence that these 3 villages and their residents have resided on Bobokana land/area, inside of GBB, long before the defendant begun operations. And this claim is not about ownership over Bobokana land/area. This claim is about residents of the 3 villages of Bobokana area, complaining about damage caused to their livelihood/environment by the defendant’s negligent operation. Being residents of the 3 villages, I found that claimants have standing to raise complains about what is a concern to their 3 villages and their residents. A difference has to be drawn. I am not saying claimants are the Landowners of Bobokana land. I am saying claimants are the residents of the 3 villages inside Bobokana land. This is not unfamiliar for villages in Solomon Islands. People can live together in villages as a community. But they may not all necessarily own the land, they live on, as a community. Some of them may. Some of them may not. But they still live together as a community. But they still own things in that community/village. And they still depend on that environment for their livelihood (cultivation, drinking water, sea and land resources etc). I am satisfied that that the villagers of the 3 villages have standing to raise complaints about the harm caused to their environment. If somebody alleges land ownership against these villagers, I can hear those claims another day in another case, coming through the proper channel. This resolves Issue No (vii).
  4. Defendant also submit that, Mr Hevalao is not an approved/appointed person under Section 17 of the Environment Act 1998 (Act No. 8 of 1998). So he does not have authority to produce Assessment Reports (AR) on the environment. And claimants or this court cannot place reliance on the AR he produced for the claimants. On the materials defendant’s submissions are confusing. Indeed Mr Hevalao is an approved person to make AR for investors who wants to make developments in Solomon Islands and must as a pre-condition apply to the director of environment submitting their development proposals. Such proposals must be accompanied by an environmental report or environmental statement. An environmental report or environmental statement can only be produced by an expert. Those experts are normally appointed by the Director under Section 17. And Mr. Hevalao is such approved expert, having been so appointed by the director in year 2012[5]. That approval is evidence that Mr. Hevalao is an expert in environmental matters including preparing environmental report or environmental impact statement. If he is such expert, then I have no doubt he is capable of producing environment assessment report to tell somebody about what damage has been caused to the environment. Here he is speaking to the parties, to the court and to the lawyers about the types and extent of environmental damage that defendant’s logging activities have caused to the environment and livelihood of the claimant villages and their residents. I noted that the AR defendants produced through Mr Danitofea[6] does not contradict in a major way the findings of Mr. Hevalao[7]. On the evidence, I can say the two reports seem to agree on the environment damage caused to GBB. Mr. Danitofea confirmed the assessment made by Mr. Hevalao. But says that the natural rehabilitation occurring has started to heal the damage identified in Hevalao report. I take note that Hevalao report was made first in time in November 2016, whilst Danitofea report was made later in time in June 2018. So the regeneration of the environment is expected. And Mr. Danitofea says in oral evidence regeneration will take 50 – 100 years.
  5. Claimants have the onus to proof their claim, when they say defendant’s logging activities caused environment damage to the claimants’ livelihood and their environment. Claimants have dispensed with that burden by engaging an expert to produce a report that outlines the defendant’s failures to follow his license conditions and the environment harm that resulted from such failure. So this court can place reliance on Mr. Hevalao’s report as an expert evidence. That report is not contradicted in a major way by the report from the Ministry of Environment produced for the defendant. Expert evidence can be used in this court. This resolves Issue No (vi).
  6. Defendant’s felling license is A101174. The license covers GBB concession. The 3 villages are situated on an area inside GBB concession locally known as Bobokana area. It is public knowledge that every felling license holder and their contractors owe a statutory duty of care to the people who live in the vicinity of the concession lands within which they operate. The statutory duty of care formed the terms and conditions of license A 101174, issued to defendant, under the timber rights acquisition process under the Forest Resources and Timber Utilization Act (Cap 40), as well as the terms of a development consent issued prior to felling. It has taken me a long time to come to terms with the statutory duty of care because they were not properly pleaded in the statement of case. The pleadings are very broad. The pleading broadly say defendant, during the course of its operations on GBB, broke/breached some of the terms and condition of its license. And as a result serious environmental damage has been caused to the land, including contamination of water supply (See paragraph 3 of statement of case). Then at paragraph 10, it is pleaded that the said breaches and the resulting environmental damage are contained in the AR compiled by Mr. Hevalao. For me to establish the said breaches and the resulting environmental damage, I must read the expert’s report which outline clearly the breaches and the damage caused. I did exactly that and it took me a long time. In doing that I also come to see clearly the defendant’s statutory duty of care, which was not clearly pleaded. And so I have to establish, defendant’s statutory duty of care, from the expert evidence. When I asked Counsel Radclyffe in oral submission, his answer was “When one is claiming negligence in tort, then a judge should know and one does not have to plead again”. Counsel was not helpful. It is his duty to assist the court. Even when I asked for local authorities on liability for environment damage, he said he does not have to supply authorities. I asked because the few authorities he gave me were on assessment of damages not liability. The cases I am aware of are on trespass and damage to environment. Here, trespass or ownership of Bobokana land is not in issue. Environment damage and consequential harm suffered by 3 villages on Bobokana within GBB, from defendant’s breach of license conditions, become the issue for trial (Repeat paragraph 5).
  7. Counsel Radclyffe also submitted that duty of care was not pleaded, but damages and consequential loss were suffered. And that claimant pleaded statutory breach, because claimant plead that defendant breached condition 6 of its license. By breaching condition 6, defendant breached the Revised Solomon Islands Code of Logging Practice, May 2002 (May 2002 Code) – a term of its felling license, which contained the statutory duty of care that defendant owe to people who live in close vicinity to its GBB concession land.
  8. So what are the statutory duty of care that defendant breached on the basis of Hevalao’s AR, as submitted by Mr. Radclyffe. I look first at condition 6, of the felling license. Condition 6, relevantly states:-
  9. The Hevalao report then identifies the statutory duty of care in the May 2002 Code, that claimant allege defendant had breached. The duty of care I deduced from reading paragraph 10 of statement of case connecting with evidence contained in Hevalao’s AR are:
    1. The Hevalao report summarised the 9 breaches of the 9 standards laid down in the May 2002 Code. At page 72 of ABD the standards and their breaches were outlined. Common theme discussed throughout the 9 standards breached is “claimant had intruded and carried out operations inside of “buffer zones”. Under the May 2002 Code, defendant should not go near or operate within 60 metres of buffer zones. Hevalao report noted that Mas Solo intruded right into buffer zones. Buffer zones according to oral evidence of Mr. Danitofea are ecological sensitive areas like: swamps, wet lands, mangroves, reef flat areas, ocean, lake, lagoon, streams and rivers etc. Logging should not go near by 60 meters of buffer zones. Evidence shows that logging activities took place right inside of Kologara river. The evidence produced by Mr. Nesa and supported by Hevalao report are as follows:
    1. Re-filing tank stored along the main Kologara (K) river bank – page 43 ABD.
    2. Logging road along the K river. A bull dozer making logging road along the K river – page 44 and 45 ABD.
    1. Land cruiser driving along the K river logging road – page 46, ABD.
    1. Stock piled logs along the main K river bank – page 47 and 48 ABD.
    2. Extracted log stumps along buffer zones – pages 49 and 50 ABD.
The intrusion and damage to buffer zones reported on by Hevalao AR are seen in evidence pictures/photo graphs supplied by Mr. Mayson Nesa. I also noted that the AR by the environment officer, Mr. Danitofea is in agreement with Hevalao report on destruction to buffer zones. I also noted the reasons for COF suspension of the operations of Mas Solo, are the wild and careless manner Mas Solo conducted its operations. So that when Mas Solo appealed to the Minister of Forest and the Minister lifted the suspension, the lifting was made on satisfaction that appropriate remedial measures were being made by Mas Solo. In other words the COF had carried out field research and noted serious breach of the May 2002 code in particular intrusion into rivers and streams. And COF suspended the Mas Solo license, on 2/08/2016. Mas Solo appealed on 15/09/2016. Mas Solo admitted and said that it is taking remedial measures in his appeal letter to the Minister[8]. The Minister in lifting the COF suspension noted the remedial measures Mas Solo was undertaking were satisfactory. And the Minister says that any more non-observance of the May 2002 Code will result in sanctions. It is apparently clear that Mas Solo failed to comply with standards meant to avoid serious destruction to sensitive ecological and environmental parts of the environment. I am satisfied on the balance of probability as to the allegations on breach of standards under the May 2002 Code. In other words, the company breached its statutory duty of care to avoid operation in buffer zones.
  1. The next question is: does defendant owe this duty of care to the 3 villages on Bobokana land within GBB concession land? The answer is yes. It is public knowledge that the forest is the source of livelihood for people in Solomon Islands. In the forest are villages and settlements. In the forest are sources of food for villages and villagers. In the forest are source of drinking water for village people. In the forest are places of traditional worship and cultural importance. And so to stop logging within 60 meter of rivers is meant to protect people’s livelihood to drinking of quality water. In the river are fish and shells that people feed on. So when a statutory duty of care is embodied in a license, it is meant to protect villages and villagers who may be located within the concession land of the forest. The licensee or its contractor need to minimise damage to buffer zones, by staying clear by 60 meters. I found on the evidence that the 3 villages are located well within the GBB concession land under defendant’s felling license No A 1011174. And so I can draw the conclusion that defendant owed a duty of care to these 3 villages not to destroy their river and environment like the buffer zones. Even the Danitofea report confirmed that Mas Solo intruded into buffer zones, where it noted that Mas Solo landed on areas located within buffer of the streams and rivers in Block B[9] or GBB. Danitofea said that damage has since improved because Mas Solo left by 2017. Danitofea report recommended clearing of the logs that were abandon along the rivers[10].
  2. On the issue of harm suffered by the 3 villages from the defendant’s breach of duty of care. Again the Hevalao report had assessed the environment damage to include: damage to loss of biodiversity biomass; loss of useful non timber plants; damage to soil fertility and water quality; intrusion of undesirable weeds and unwanted animal pests and soil acidification and human inter cession in abating the effects of soil erosion[11]. For these five broad loss of access and livelihood, Hevalao assessed it to the quantum of $2,000,000.00. The report also put at $1, 2000, 000.00 the cost of rehabilitation for the areas damaged. These are the harm suffered by the 3 villages. The harm is one done to their environment and hence their livelihood that depends on the environment. It is worth noting that the environment is like a supermarket to the livelihood of Solomon Islanders (Repeat paragraph 12). The foregoing answered in the positive Issues No (i), (ii), (iii) and (iv).
  3. Defendant says that damage complained of was unavoidable. Such submission based on Rose Mining case is not genuine. Rivers and buffer zones are easily identifiable and must not be intruded into. Logging must stay clear of rivers by 60 meters. Whereas the evidence showed defendant operated right inside of rivers – for instance the K river (Repeat 11 above). As long as defendant stayed clear of buffer zones, damage to rivers as a result of logging like muddy water is truly unavoidable. But you cannot operate inside of K river and still say, damage to the river is unavoidable, because it is avoidable to stay 60 meters clear.
  4. Defendant also submit that sanctions and penalties are stipulated under the relevant Acts (Forestry and Environment). And those sanctions are imposed by state institutions. So counsel Marahare is of the view that legislation have displaced common law actions for trespass, nuisance and damages. I do not think parliament can suppress people’s rights to protect their environment, if counsel’s submission is to stand. And it is known in here and other jurisdictions that citizens can protect their rights by lawsuits to protect the environment, which includes lawsuits claiming for damage caused to the environment. It is very clear that the law (license condition 6 – May 2002 code) is meant to protect villages and villagers who reside and depend on the forest for their livelihood and sustenance. That loggers must try to minimise damage that are avoidable such as staying 60 meters clear off rivers. And when there is blatant disregard, as the evidence here overwhelmingly established, the villagers protected under the law can take action. And the court can take heed. Court has a duty to protect the environment. Court as the custodian of law has a duty to ensure laws are followed, to achieve the purpose set out in the law. The laws are Forestry and Environment laws (through the license conditions) meant to protect the livelihood of villages and villagers situated within the vicinity of logging operations. And there are cases in this court where damages were ordered against logging companies, for damage to trees and environment, but in trespass claims. This case is not a trespass claim, but brought by people who live within the GBB concession who suffered from the careless acts by the defendant, who intruded into buffer zones during its operations. It is for such people’s interest that the May 2002 Code imposed conditions prohibiting defendant not to intrude into rivers and buffer zones.
  5. Defendant further submitted that the nuisance complained of was not properly pleaded and relied on the case of Cychen and LC Trading Co. Ltd. That case only reached the pleading stage. This case has reached trial where there is strong evidence on defendant’s statutory duty of care, defendant’s failure of that duty and the direct harm caused to the claimants. Although these were not properly and clearly pleaded, like I allude to in paragraph 8, I took a lot of time to understand how the case is constructed. For instance at paragraph 10, statement of case, where it pleads: “Particulars of the breaches of the terms of the license and the code and the environment damage are set out in the experts’ report, which will be disclosed to the defendant”. So I had to read the statement of case and connect with the evidence to establish the duty, breach and harm. This is not easy. And took me a long time. In other words what is not seen in the pleadings can be seen in the evidence. In Cychen case, is different, because it only reached the pleading stage when the deficiencies in pleadings were discovered through request for further and better particulars. No such request were made here.
  6. The case for the defendant also says that breaches of May 2002 Code is not actionable in this court because the monitoring process provided for at pages 17 and 18 of the Code was not followed. The monitoring process in the code is the duty of the state institutions like the Forestry department. And there is evidence Forestry has utilised the monitoring process[12]. And that evidence is admitted in this case. But that does not take away the apparent damage done to K river and buffer zones as the evidence has overwhelmingly established; even supported by the evidence produced for the defendant by Danitofea. All the claimants are to do is to establish duty of care, breach and harm suffered. For the monitoring is a matter outside of their powers and must be raised with the relevant state institution (COF). That aside, I am satisfied claimants have established their claim on duty, breach and harm (repeat paragraphs 10, 11, 12 and 13).
  7. As to breach of condition 31[13], claimant asserted, I am satisfied that defendant had no chance to fulfil those obligations because it was forced to leave GBB, due to disputes. And was willing to go back to GBB again pending settling of disputes that forced it to leave. Dispute with a third party not claimants. But with compensation award herein, claimants can pay for restoration work under condition 31. Quantum of $1, 2000, 000.00 was assessed for cost of rehabilitation, in Hevalao’s AR and is part of the $3, 2000, 000.00 awarded below in damages. Purpose of compensation is to restore back the claimants to the state they were in prior to damage complained. And although no monetary compensation can restore environment to its natural intactness, it nevertheless will attempt doing that through rehabilitation ways suggested by Hevalao.[14]
  8. In conclusion I am satisfied Mas Solo was careless to operate and intrude right into buffer zones, in contravention of the May 2002 Code, a condition of its felling license A 101174, which imposed a statutory duty of care, on the defendant, to be very careful to minimise damage to the 3 villages and villagers who reside within GBB concession land. As a direct result of defendant’s failure, the 3 villages and villagers have suffered harm to the environment. The environment upon which they depend for their livelihood. I take particular notice of operations that intrude right inside of K river, as well as other damage detailed in the report by Mr. Hevalao. I can therefore grant the reliefs sought as follows:

THE COURT
JOHN A KENIAPISIA
PUISNE JUDGE

[1] Page 96 of ABD, Mr. Cecil statement on organizing of 2 protest marches.
[2] Page 33 and 34 of ABD, See also email correspondences at pages 19 to 30 of ABD.
[3] Page 35 of ABD.
[4] Page 38 and 39 of ABD.
[5] Page 76 ABD.
[6] Report at pages 204 to 222 of ABD.
[7] Report at pages 53 to 93 of ABD.
[8] See Page 37 ABD.
[9] See page 213 of ABD – Paragraph 2.1.1.
[10] See Page 220 of ABD – Recommendation 4.1.
[11] See Page 73 of ABD – 7.1 – loss of access and livelihood.
[12] Pages 35 ABD.
[13] See Page 123 of ABD for obligations under condition 31.
[14] See Pages 73 of ABD, at 7.2 – cost of rehabilitation.

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