DC2054

PAPUA NEW GUINEA

[In the Civil Jurisdiction of the District Court held at Mendi]

DC No. 72 of 2010

In the Matter of an Application under the Land Dispute Settlement Act Ch. 145

AND:

In the Matter of an Application by Bruce Izane for himself and the Awinda Tribe, Izane Tribe & Rigima Sub-Clan of Ayene Tribe
(Complainants)

AND:

Peter Botten – Managing Director - Oil Search (PNG) Limited
(First Defendant)

AND:

Francis Kabano – Community Affairs Co-operative Manager - Oil Search (PNG) Limited
(Second Defendant)

AND:

Oil Search (PNG) Limited
(Third Defendant)

AND:

Samson Aluanda, Tom Hoyabe, David Pongone, Amos Pongone, Lee Porawi & Bobby Yupi for and on behalf of Ayene Tribe
(Fourth Defendants)

Mendi: C Inkisopo

2010: 26th May & 23rd June

District Courts Act Chapter 40 – District Court; a creature of statute and a Court of limited jurisdiction – its powers defined and the parameter of application demarcated by statute –

District Courts (practice & procedure) – its practice & procedure defined and set out by statute – section 25 of Act provides for set aside of ex parte orders by an other District Court – such applications to be determined in accordance with established principles –

District Courts (practice & procedure) – ex parte order entered irregularly to be set aside as a matter of principle – whilst ex parte order entered regularly or by slip or error requires exercise of discretion – matters relevant to exercise of discretion - (1) affidavit stating facts disclosing defence on merit – (2) explanation why order was allowed to go ex parte & (3) promptness or otherwise of application –
 
District Courts (practice & procedure) - civil jurisdictions of District Courts under sections 21 and 22 of Act – whether any substantive proceeding on foot such that an order of restraint was necessarily imperative to preserve and/or maintain the status quo – whether substantive matter on foot where serious question of law & fact to be determined – whether balance of convenience favours the continuity or lifting of the ex parte restraining order -

District Courts (practice & procedure) – District Court civil jurisdiction in and over disputes to interests in customary land ownership – District Court jurisdiction to issue interim orders of restraint in customary land dispute matters – 

Authorities/Legislations referred to:

(1)	Constitution of Papua New Guinea
(2)	District Courts Act Chapter No. 40
(3)	Evidence Act, Chapter No 48
(4)	Land Dispute Settlement Act, 1975

PNG Cases cited/referred to:

1:	AGK (NG) Pty Ltd -vs- Anderson (2000) N2062
2:	Augerea -vs-Bank South Pacific Limited (2004) SC869 
3:	Barker -vs- PNG [1983] PNGLR 239
4:	BSP -vs-Spencer [1976] PNGLR 340
5:	Employers Federation of PNG -vs- PNG Waterside & Seamen's Union (1982) N393
6:	Golobadana No 35 Limited -vs-Bank South Pacific Ltd (2002) N2309 -considered
7:	Green & Company Pty Ltd -vs-Green [1976] PNGLR 73 -considered 
8:	National Housing Corporation -vs- Yama Security Service Pty Ltd (2000) N1985
9:	Public Employees Association -vs- Public Service Commission [1988-89] PNGLR 585
10:	Victor Golpak -vs- Patrick Alongrea Kali & 5 Ors [1993] PNGLR 491 -applied

Appearances:

(1)	Mr Mathew Tamutai for the Applicants/Fourth Defendants

(2)	Mr Jerry Tonge for the Respondents/Complainants

HELD: 

1:	There is no substantive matter on foot dealing with any serious issue of substance then immediately pending before any tribunal upon which the subject ex parte order for restraint was founded;

2:	Matter concerning dispute over interests in customary land is a proper matter to be dealt with under the Land Dispute Settlement Act, 1975; only by a Local Land Court and none other including the District Court;

3:	The balance of convenience does not favour the continuity of the subject ex parte order for restraint; and shall therefore lift forthwith as the Respondents/Complainants are not likely to suffer any irreparable damage by its discharge as adequate reliefs in an award of damages are available;

4:	The ex parte order of this Court dated 25th March, 2010 was irregularly entered and as a matter of principle, it must be set aside forthwith and dismissed;

5:	On the question of costs; as this is a matter for judicial discretion, given the particular circumstances and background of this case; each party shall bear own costs of this application.

23rd June, 2010

JUDGMENT

C INKISOPO: This application to set aside an ex parte restraining order was made before this Court on its next returnable date of 26th May, 2010. The ex parte order for restraint was issued by his Worship, Mr Robert Teko of Ialibu District Court; granted on the 25th of March, 2010. 

2:	Mr Mathew Tamutai of Tamutai Lawyers acting for the Applicants/Fourth Defendants (hereinafter called Applicants for short) sought to make the application to set aside the ex parte order for restraint on the back of a Notice of Motion with supporting affidavits he filed and served on opposing Counsel Mr Jerry Tonge of Tonges Lawyers on even date. He next sought leave to make his application orally when opposing Counsel objected to the application being heard that day on grounds that the process was short-served (served on date of hearing); contending instead that the matter of the application should be fixed for return hearing at a later date.

3:	Mr Tamutai then opted instead to forego the use of the Notice of Motion and the supporting affidavit; rather opting to make oral submissions on the face of the subject ex parte order and its supporting documentations. Mr Tamutai was permitted to do so on the face of the original depositions filed supporting the grant of the ex parte order the subject of this application as he chose to do so without reliance on the Notice of Motion and supporting documents he filed for the application when opposing Counsel took objection which was a valid one; - for Section 35 (1) of the Evidence Act Chapter 48 says that affidavit material intended to be used in proceedings before any tribunal is to be served on the opposing party within not less than 5 clear days before the hearing of the matter that the affidavit material sought to be used relates to.

4:	The Court allowed both Counsels to orally argue and counter argue the application to set aside the ex parte order of 25th March, 2010. In order to have a fuller appreciation of the background of this matter; I consider it appropriate to give account of the origin of the ex parte order that is now sought to be set aside and the facts giving rise to its existence in the first place.

The factual background:

5:	The Respondents/Complainants and the Applicants/Fourth Defendants are all locals from the Koroba District of the Southern Highlands Province. They seemingly have a dispute over a particular piece of customary land known as Maya land (according to the Complainants) and presently called "Korka Rig Site" where the oil rig currently stands and operating. The operator of the rig, the Third Defendant is said to be making compensation and other payments allegedly to selected three (3) sub-clans only whilst the others of the tribes are missing out on the benefits especially, as they contend, when the land on which the rig stands belongs to four (4) tribes of the locale comprising over three (3) thousand people. Correspondences with Oil Search Limited, the Third Defendant, were entered into asking to sort this matter out and also through the Office of the Koroba/Lake Kopiago District Administrator as well as personal representations by their representatives all to no avail.

6:	When the First, Second and Third defendants did not offer any responses to their representations, the Respondents/Complainants took their complaint to the Court through their lawyer, Messrs Tonges Lawyers and the matter of this restraining order was successfully obtained through the hands of Ialibu based District Court Magistrate, Mr Robert Teko. In this respect, I note that the matter appears to me to have been registered here at the Mendi District Court and the Court's worksheet upon which his Worship made his endorsements is Mendi District Court's and the matter apparently heard ex parte by the Ialibu District Court Magistrate by way of a proper grant of judicial dispensation with the requirement for service of the process. 

7:	I do not intend to delve into the issue of what was the particular urgency of the matter at the material time that persuaded his worship to grant the dispensation order as it was a matter for judicial discretion his worship was entitled to exercise at the given time based on the material before him to grant the dispensation with the service requirements.

8:	A Mendi District Court registered matter heard by another Magistrate based in another District Court within the Province - to an extent and to my satisfaction was explained out by Mr Tonge verbally in Court; that given the 'urgency of the matter' at the relevant time the ex parte order was obtained, there were no Magistrates in Mendi before whom to bring the application. Hence, it was taken before the Ialibu based District Court magistrate who dealt with the application. I agree that I, Cosmos Inkisopo, the Civil Court Magistrate in Mendi District Court was away in Lae on sick leave during the period in issue but the Senior Provincial Magistrate; Mr Samson Tatakali I believe had always been available to have heard the application. 

9:	I can not tell with any certainty as to the availability of the Senior Provincial Magistrate at Mendi to have heard the application for the restraining order as I was in Lae. There is therefore a fair degree of doubt in that respect as to the availability of a Magistrate at the Mendi District Court at all material times to have heard the application. I therefore give the benefit of the doubt to the Respondents and accept that they took their application for restraining order to the next available District Court Magistrate within the Province who heard the application and granted the order. I do not intend therefore to take this issue any further than to leave it at that.

10:	The principles governing applications of this nature are well settled in this jurisdiction commencing with the oft-cited case of Green & Company Pty Ltd -vs- Green [1976] PNGLR 73 which has been expanded on by the higher Courts of this land and the principles refined and settled in this jurisdiction which in summary are;-

1:	Reasonable explanation in affidavit form why the subject order was allowed to go ex parte and/or by default;

2:	Affidavit material stating facts which give rise to defence on merit; and

3:	Reason explaining why application not made promptly if there is delay.

11:	Whilst these are the applicable principles governing set aside applications of ex parte orders; Mr Tamutai in this application in foregoing the use of the documents he filed and served on even date in support of his application; rather presented his application orally; the grounds and reasons for which are summarized as follows;-

1:	As the day was the first proper returnable date before a Court after the ex parte order the subject of the application was entered, he was entitled to make the application as of right pursuant to Section 25 of the District Courts Act Chapter No 40; and 

2:	That the subject ex parte order was flawed on the face of the record per se and in many other respects including the apparent impropriety of the District Court arbitrating in a matter involving disputes pertaining to customary land ownership and/or interests in customary land; and

3:	The proper method of proceeding would have been to have proceeded under the provisions of the Land Dispute Settlement Act, 1975.

12:	 Mr Tonge speaking for the Respondents/Complainants countered the application by saying that this was a matter of only a dispute as to compensation and royalty payments being made by the operator of the rig, Oil Search (PNG) Limited to only a select few sub-clans when the benefits should be due to the tribe which owns the communal land on which the rig stands. As such the tribe whose members number in excess of three (3) thousand were missing out on the compensation, royalty benefits and other payments; so as he says, the restraining order was necessary to stop Oil Search (PNG) Limited, the Third Defendant from releasing any payments 'until the customary Maya Land is resolved' (see paragraph 11 of the affidavit of Bruce Izane dated 25/03/2010).

13:	As I understand Mr Tamutai's argument, he says that the ex parte restraining order the subject of the application on the face of it was flawed as this Court did not have the jurisdiction in the first place to arbitrate on when the substantive basis of the Respondents' claim relates to disputes over interests in customary land which must be dealt with under the Land Dispute Settlement Act, 1975. The only tribunal prescribed and authorized to deal with issues over interests in customary land ownership is the Local Land Court and none other; neither the District Court nor the National Court. He cites in support of this proposition the case of Victor Golpak -vs- Patrick Malongrea & Ors [1993] PNGLR 491, a decision of her Honour, Madam Justice Doherty in a case in which Plaintiff sought to obtain a restraining/declaratory order against the Defendants from contracting for the use of a customary land which Plaintiff said devolved to him through matrilineal succession.

14:	In refusing to arbitrate the matter of that application, her honour in the head note of the judgment said;-

"The jurisdiction to determine ownership and title to customary land is in the Local Land Court under the Land Dispute Settlement Act. Until the ownership or 'interest in land' is determined, the National Court can not arbitrate." 

15:	Her honour went further and said that when the Land Dispute Settlement Act in its interpretation segment defines the 'Court' as having the jurisdiction under the Act to mean the Local Land Court; it means just that and does not include the National Court event though it has inherent jurisdiction under s 155 of the National Constitution which by all account in my humble view extends to include the District Courts as well.

16:	I do appreciate that by reason of the choice Mr Tamutai has taken, there is no evidence before this Court to consider and assess the substance of the application under the Green -vs- Green (supra) principle. But in view of his clients' arguments as he argued and put it before me, I understand him to be saying that the ex parte restraining order of this Court of 25th March, 2010 by the fact of the flaws he has pointed out in argument should not stand and continue as it (subject ex parte restraining order) was irregularly entered. Matters that go to demonstrate irregularity in the entry of this ex parte order seem to me to be as follows;-

1:	There seems to be no evidence of a substantive proceeding before the Court upon which the subject restraining order was founded and obtained in order to preserve and maintain whatever the status quo;

2:	There is no written undertaking as to damages filed prior to the application nor today (26/05/2010) since the ex parte order was obtained;

3:	The District Court lacks jurisdiction to deal with a matter that substantially involves dispute relating to customary land or interests in customary land.

17: 	The subject ex parte order by the very nature of it saying in the ending segments of Order clauses #3 and #4 where it says "until dispute over Korka Rig site is resolved" means that this ex parte order is not a substantive and final matter concluded by that ex parte order hence implying that the question of whether to set aside or not can be considered and weighed against the established principles such as the question of the regularity or otherwise of the entry of the ex parte order; whether or not there is affidavit disclosing defence on merit; whether there is reason explaining why judgment was allowed to go ex parte and whether there is reason explaining delay for application (if any) that can be considered, assessed and weighed.

18:	As is the case, the subject ex parte order is basically one of a restraining order "until the issue over the 'Maya' land is resolved" which presupposes and suggests to this Court that there is on foot a process to determine the issue of land ownership dispute which had yet to resolve. As it is an ex parte restraining order pending a purported matter on foot that the ex parte order for restraint attempts to protect by restraining parties from engaging in activities or conducts that would otherwise frustrate the object and purpose of the purported substantive matter on foot. In such situations; different considerations and principles apply. The prime consideration concerns the question of the continuity or otherwise of the restraining order secured ex parte which is governed by principles that are settled in this jurisdiction by the higher Courts.

19:	 The abundance of authorities say that the principles going to the question of the continuity or otherwise of interlocutory injunctions obtained ex parte are whether serious questions of law and fact are to be determined in the proceeding and whether the balance of convenience does or does not favour the continuity of the interlocutory ex parte injunctive order in order to preserve and maintain the status quo. The authorities say that the balance of convenience does not favour the continuity of the ex parte restraining or injunctive order when the party in whose favour the ex parte restraining order was made would be adequately compensated by award of damages if he succeeds in the substantive proceeding. See Employers Federation of PNG -vs- PNG Waterside Workers & Seamen's Union (1982) N393, PEA -vs- PSC [1988-89] PNGLR 585 and Golobadana (No 35) Limited -vs- Bank South Pacific Ltd (2002) N2309.

20:	Applying these principles to the facts and circumstance of the Respondents' case as far as regards the question of the continuity or discharge of the ex parte restraining order, the issues for resolution before us are a number and varied;-

1:	Whether the subject ex parte restraining order was regularly entered; and

2:	Whether there is a valid substantive matter and/or process on foot before a proper tribunal such that the ex parte restraining order was necessary to preserve and maintain the status quo; and

3:	Whether there are serious questions of law and/or fact to be determined in the proceeding (if any) on foot; and

4:	Whether the balance of convenience favours the continuity or the discharge of the ex parte restraining order the subject of the Application.

21:	 The facts of this case as borne out from the affidavit of Bruce Izane dated 25th March, 2010 are that the Third Defendant has set up an oil rig at a particular customary land traditionally called 'Maya Land" which is renamed "Korka Rig Site" for which compensation, royalty and other payments are being made to only three (3) clans of Wetia, Pewi and Miagu whilst four (4) other tribes are left completely out.

22; 	The Respondents/Complainants perceived and apparently being grieved at being left out, entered into correspondences seeking to negotiate with the Third Defendant to include the four tribes of Awinda, Izane, Rigima and Ayene to also benefit from the royalties and other benefits being derived from the Maya Land on which the oil rig currently stands. They also enlisted the assistance of the District Administrator of Koroba/Lake Kopiago District to take their cause further via a letter dated March 8th, 2010 all to no avail. They then took their grievance to the Court whereby an ex parte order for restraint was issued against the Defendants; especially the Third Defendant from making any compensation, royalty or other payments for the use of the Maya Land to the Fourth Defendants until the 'land issue is resolved'.
 
23:	On the question of regularity or otherwise of the entry of the subject ex parte order, the original depositions filed in support of the application for the ex parte order do not disclose firstly; if any written undertaking as to damages was filed prior to, at the time or soon after the entry of the ex parte restraining order the subject of this application. Mr Justice Sevua in Gobe Hongu Ltd -vs-NEC & Ors (1999) N1920 said at p. 6;-

"The usual undertaking as to damages is a condition precedent to the granting of an interlocutory injunction. Such undertakings must therefore be given by the Applicant at the time of making the application, i.e., filed at the time of or prior to the making of the application. The usual undertaking as to damages is given by a plaintiff who applies for an interlocutory injunction. It is a condition precedent for obtaining the order to give the usual undertaking as to damages … however, it has become the practice in this jurisdiction, as in New South Wales and other jurisdictions that an undertaking as to damages must be given".

24:	 His honour further emphasized and adopted what he said above in the later case of the National Housing Corporation -vs- Yama Security Services Pty Ltd (2000) N1985. In our present case, there seems to be no evidence of it on file but when the Court raised this with Counsel for Respondents Mr Tonge, he verbally told the Court that the Respondents at the time of the application on the 25th of March, 2010, made an oral undertaking as to damages. Be that as it may, there does not seem to be any evidence of any undertaking as to damages on file and I must confess; there really is none filed before the ex parte restraining order was obtained. The authorities in this jurisdiction are clear; they say that the undertaking as to damages is a condition precedent to grant of ex parte restraining or injunctive orders.

25:	There does not also seem to be evidence of any proceeding on foot such as a land mediation process or a Local Land Court hearing being conducted such that it would have been necessary to have issued a temporary restraining order to preserve and maintain the status quo pending the Local Land Court determination of the dispute Respondents say existed over the Maya Land as that would have been perfectly in order and permissible under Section 22 of the District Courts Act, Chapter No 40. To the exact contrary and on the face of the documents presently available in the hands of this Court, there is no evidence of any a proceeding on foot upon which an ex parte restraining order would have been appropriate and necessary. 

26:	There being no proceeding on foot necessitating a restraining order, there likewise are no serious questions of law or fact to be determined. "There being no serious question raised for determination, the injunction sought should not be granted." See PEA -vs- PSC [1988-89] PNGLR 585 per the late Kapi DCJ (as he then was) at p.587. Similarly, any ex parte injunctive order granted with that apparent flaw should not likewise continue but discharge forthwith.

26:	One final consideration is the issue of whether the balance of convenience favours the continuity or discharge of the ex parte order of restraint the subject of this application. As to the issue of balance of convenience, the late Kapi DCJ (as he then was), said in Employers Federation of PNG -vs- PNG Waterside Workers & Seamen's Union (1982) N393;- 

"As to balance of convenience, the Court must then consider whether if the Applicant succeeds, he would be adequately compensated by damages for the loss sustained between the application and trial, in which case no interlocutory injunction should normally be granted."

27:	See also the cases of Golobadana (No 35) Limited -vs- Bank South Pacific Limited (2000) N2309, Augerea -vs-Bank South Pacific Limited (2004) SC 869; all of which support the same principle which holds to say that the balance of convenience does not favour the party in whose favour the restraining order was granted and if they were to lift and if lifted or discharged and if the party in whose favour the ex parte order for restraint succeeds in the proceeding, he will adequately be compensated by award of damages.
 
28: 	In the present case, if the present restraining order was to lift, there is no evidence of irreparable damage likely to be suffered by the Respondents/Complainants but instead, they are likely to adequately be compensated by an award of damages if they do suffer any damage by the lifting or discharge of the order for restraint. They will adequately be compensated by award of damages in this case and I venture and dare say this: because the Third Defendant is not just another ordinary citizen but a multimillion kina corporate oil prospecting, drilling and extracting giant of this country and it is in my view handsomely capable of meeting any award of damages against it if this ex parte restraining order is to lift and the Respondents suffering any consequential damages. 

29:	In the final analysis and in all of the circumstances of this case, I make the following findings of fact based on the material before me;-

(a):	There is no substantive proceeding on foot to sustain the ex parte restraining order;

(b):	The ex parte order was irregularly entered by the District Court when it did not have the jurisdiction to deal with same in the first place in the way it did;

(c):	The balance of convenience does not favour the continuity of the subject ex parte restraining order of 25th March, 2010.

30:	The orders of this Court therefore are as follows;

1:	The ex parte restraining order of this Court of 25th march, 2010 is set aside and discharged forthwith;

2:	The entire proceeding is dismissed as being wholly misconceived;

3:	As the issue of costs is a matter for judicial discretion, I order each party to bear own costs of this Application

Lawyers:

1:	Messrs Tamutai Lawyers; -for the Applicants/Fourth Defendants

2:	Messrs Tonges Lawyers; -for the Respondents/Complainants