PNG Law Reports 1995
[1995] PNGLR 246
N1318
PAPUA NEW GUINEA
[NATIONAL COURT OF JUSTICE]
APPLICATION OF MOGE ENGA AND KUIPI GROUP IN THE MATTER OF A DECISION OF THE MINISTER FOR LANDS CONCERNING SECTION 30 ALLOTMENT 7 MOUNT HAGEN
Mount Hagen
Woods j
6 March 1995
8 March 1995
ADMINISTRATIVE LAW - Judicial review - Minister’s discretion under Land Act - Appeals under Land Act - Minister must consider judicially - Discretion may not be exercised arbitrarily - Duty to give reasons.
Facts
The Land Board, after considering a number of applications for a State lease of land, recommended to the Minister that it should be granted to the applicant. A number of unsuccessful persons who also applied for the land exercised their right of appeal against the Land Board’s decision, and the Minister referred the matter back to the Land Board for a rehearing. No reasons were given for this referral, and the applicant sought a review of the Minister’s action, which he argued was unreasonable and unfair.
Held
1.       The person who considers an appeal must act judicially, not arbitrarily; i.e. he must, inter alia, indicate to the parties why he acted the way he has, and must not act secretly.
2.       The granting of a State lease is not the sole prerogative of the Minister. Whilst he is the functionary who can reconsider the recommendation of the Land Board if there are real suggestions of maladministration, he cannot interfere if all has been done properly.
3.       The Minister has acted unreasonably and outside the boundary of his discretion in rejecting the recommendation of the Land Board without giving reasons.
4.       The Minister’s decision is, therefore, harsh and oppressive, and his discretion has not been exercised according to principles of natural justice and fairness
Cases Cited
Papua New Guinea cases cited
Application of the NCDIC [1987] PNGLR 339.
Gegeyo v Minister for Lands [1987] PNGLR 331.
Other cases cited
Council of Civil Service Unions v Minister for the Civil Service [1984] 3 All ER 935; [1985] AC 374; [1984] 3 WLR 1174.
Counsel
P Peraki, for the applicant
H Polume, for the Minister for Lands and the Land Board.
W Duwa, for Kala Autoport.
S Norum, for Ponpond Business Group.
P Kunai, for Rowason Development.
8 March 1995
WOODS J: This is an application seeking a review of the decision of the Minister for Lands in rejecting a recommendation by the Land Board for the grant of a State lease over land at section 30 allotment 7, Mount Hagen, to the applicant and seeking a declaration that the decision of the Minister is harsh and oppressive.
The other business groups appearing on this application are other parties to the original application before the Land Board.
In 1992, the subject land described as section 30 allotment 7 was advertised by the Lands Department as being available for tender by the usual Land Board procedures under the Land Act Ch 185. A number of persons or organisations, including the applicant, submitted tenders for a State lease over the land.
In July 1993, the Land Board sat in Mount Hagen to consider the applications for this land. In August 1993, the Land Board endorsed a recommendation to the Minister in accordance with the Land Act that the State lease over the subject land be granted to the applicant. The applicant was advised that it was the successful applicant before the Land Board. Before the Minister could act on this recommendation, a number of losing applicants lodged appeals to the Minister in accordance with the provisions of s 11 of the Land Act as persons aggrieved. The appeals were lodged by way of letter to the Minister. The appeals made reference to allegations of partisanship by the Land Board, or reference to the averaging out of successful applicants to land, or claims to be the traditional owners of the land, claims to a prior promise made by the Department of Lands to one of the appellants, and allegations over the illegal advising of the applicant before the Minister had properly considered the matter. Following the lodging of these appeals, the Secretary for Lands wrote a brief to the Minister, merely summarising the main allegations and recommending that the Minister uphold the appeals and send the matter back to the Land Board. This brief is titled Policy Submission Paper No 6/93 (Highlands Region) and is dated 1 December 1993.
The applicant is submitting that the Minister has erred in the exercise of his discretion under the Act, has acted unreasonably and unfairly, and has given no reasons for his action in upholding the appeals. The applicant states that he had acted properly under the Land Act, whereas other applicants had been declared to be informal because of defects in their applications, that it was fair and proper hearing by the Land Board, and that the Minister acted unconscionably in upholding the appeal without giving any reasons and where there were no reasons. The applicant submits that the Minister’s discretion is not absolute but must be exercised according to established principles. Amet J, as he then was, said in Application of the NCDIC [1987] PNGLR 339 that administrative decisions may be declared inoperative if made in bad faith, or of irrelevant consideration, or an unlawful assumption of authority.
In that case, it was submitted that the Minister had an absolute unfettered discretion in matters of land. That submission was rejected by Amet J. His Honour said at p 343 that when a Minister gives no reason in a case where he may reasonably be expected to do so, the courts may infer that he has no good reason for reaching his conclusions, and this “leaves it wide open for allegations and inferences that such decisions were made with ulterior motives.”
The lawyer for the State has submitted that once losing applicants have appealed, it is open to the Minister to reject the recommendation of the Land Board merely because the applicants have exercised their right of appeal, that there is no requirement in the provisions of the Land Act for appeals to state the reasons, and that the Minister has an absolute discretion. The lawyer states that the applicant still has avenues open to it to reapply before the Land Board at the new sitting.
The lawyers for the other appellants against the Land Board’s recommendation reiterate these submissions. They assert that the Land Act imposes no criteria for the right of appeal, and this Court cannot insist on any criteria where none is laid down. They say the Minister only has to have a belief that the Land Board may have acted unfairly. They say that, even if the Minister may have appeared to have acted unfairly, that is not enough for this Court to intervene by way of judicial review. The Court can only intervene if the Minister has acted unlawfully, and he clearly has not acted unlawfully here, as the Act specifically gives him the power to consider the recommendation of the departmental secretary and act on it. 
It is submitted that the applicant has the onus to satisfy the Court that the Minister has acted unlawfully, and the applicant has not satisfied that onus. The furtherest the applicant may have gone is to show that the Minister has acted unfairly against the applicant, who was the person originally recommended for the grant of the lease. 
The simplest statement of the principles to be applied in considering whether an administrative action is subject to control by judicial review has been stated in the case Council of Civil Service Unions v Minister for the Civil Service [1984] 3 All ER 935 under three heads:
1.       Illegality, where the decision-making authority has been guilty of error of law.
2.       Irrationality, where the decision-making authority has acted so unreasonably that no reasonable authority would have made a decision.
3.       Procedural impropriety, where the decision-making authority has failed in its duty to act fairly.
It must be reiterated that this Court is not concerned with the actual decision made by the relevant administrative bodies, namely the Land Board or the Minister. This Court is not considering the respective merits of the different applicant’s applications. This court is considering the decision-making process, whether that process has miscarried in some fashion so as to justify interference. 
So what is this procedure under the Land Act. It is a procedure for the fair and impartial granting of State leases over State land. This is done by setting up a specialist board whose duty it is to consider applications and decide between the merits of different applicants and make an appropriate recommendation to the appropriate functionary, whose duty it is to sign the actual lease on behalf of the State. The Board does all this by advertising that the respective parcel of land is available for applicants to apply for and then, in due course, holding a hearing, when applicants can present their evidence and other material to attest to their suitability. There is no suggestion here that any special preference was to be given to any particular class of person, whether by way of original landowning rights or prior dealing with the State. All this was done, and at the end of the day the applicant was the so-called successful applicant, being the person whose name was presented to the Minister in the recommendation. To this point there is no suggestion of any irregularity, apart from some unsupported allegation in letters of appeal. So what is the status of the appeals? What do they mean?
The State and some parties submit that the mere fact of an appeal is grounds for the Minister to, in his discretion, reject the recommendation and, thereby, reject the detailed work and consideration of his expert committee or board. This does not make sense in any terms. Why was a specialist board set up to do this work of considering the most suitable applicant for a grant of State land if this means nothing to the Minister. Can the Minister reject a recommendation on any or no ground or because of his own personal predilections or preferences? I cannot find under any rationale that this is our system of government. That suggests a government by ministerial decree, or dictatorship. The Land Act is an act which gives every citizen or organisation an equal chance to apply for land, and it sets up a specialist body to consider these matters. The merits of this specialist body must mean something, fairness and impartiality. There is then an appeal. An appeal is a procedure of law which presupposes principles of justice. The person who considers an appeal must act judicially, not arbitrarily. This means he must act on good reasons. There must be good reasons presented to support an appeal, and a person considering an appeal must indicate to the parties interested why he has acted the way he has, and not secretly. His reasons should not be secret. 
So what was the nature of these appeals. They were by losing applicants, but they did not present any coherent reasons. They merely made allegations, but presented no basis of evidence to support these allegations. The submission by the Secretary for Lands itself does not present any support for the allegations, support which it would have had from its own records if there was any merit in the allegations. The Secretary merely repeats the allegations but gives no departmental decision which suggests that one of the appellants was supposed to be given preferred treatment. The Secretary seems to support the suggestion that the Minister’s discretion is an arbitrary one. To take these suggestions to their logical conclusion, any losing applicant, by the mere fact of lodging an appeal, could force rehearings forever and, thereby, hold up all development of land in the country. 
The Lands Department and the granting of leases for State land is not an exclusive fiefdom of the Minister for Lands. The system of government in PNG is a democratic form of government, where all persons have equal rights. These equal right are subject to regulation and control. For example, to allow every person an equal right and chance to acquire State leases, there is a specialist body called a Land Board set up to consider the merits of applicants. Thus, the granting of State leases is not the sole prerogative of the Minister. He is merely the functionary who, at the end of the day, signs the grant of the lease after the specialist body has considered the best applicant. Whilst he is also the functionary who can reconsider the recommendation of the Land Board if there are real suggestions of maladministration, he cannot interfere if all has been done properly. If he interferes, he can only do it judicially, that is why the word appeal is used, or if there is some special reason of good government. As Amet J said in Gegeyo v Minister for Lands [1987] PNGLR 331 at 338, the Minister does have discretion to act for good cause; however, “In this whole area of administrative decision making involving the legislature, the executive government and other tribunals there is no room for arbitrary decision making.” In this case before me now, there have been no reasons or evidence presented to the Minister suggesting wrong-doing by the Land Board or that all applicants did not get a fair hearing before the Land Board. The Minister, therefore, has acted unreasonably and outside the boundary of his discretion in rejecting the recommendation of the Land Board, and is subject to review by this Court.
I declare that the decision of the Minister for Lands to reject the Land Board recommendation is harsh and oppressive, that he has not exercised his discretion according to principles of natural justice and fairness, and his ruling is, therefore, invalid. I order that the applicant is the successful applicant for the grant of a State lease over the land described as section 30 allotment 7, Mount Hagen, and I order that the Secretary for Lands take all appropriate steps to issue the subject lease.
Lawyer for the applicant: Peraki Lawyers.
Lawyer for the State: Solicitor-General.
Lawyer for the third respondent: Blake Dawson Waldron.
Lawyer for the fourth respondent: S Norum.
Lawyer for the fifth respondent: Kunai Lawyers.