N911

PAPUA NEW GUINEA
[NATIONAL COURT OF JUSTICE]

MOUNT HAGEN TOWN AUTHORITY

V

STEAMSHIPS JOINT VENTURE PTY LTD

Mount Hagen
Woods J

31 July 1990
24 August 1990

CONSTITUTIONAL LAW - Provincial governments - Legislative powers - Power to provide for town authorities - Valid power - Not excluded by Local Government Act (Ch No 57) - Organic Law on Provincial Government (Ch No 1) - Mount Hagen Town Authority Act 1989 (Western Highlands).

LOCAL GOVERNMENT - Town authority - Powers - Power to impose fees - Comprehends power to raise general revenue - Validity of town service fees - Inappropriateness of being called trading licence fees - Trading Act (Ch No 324) - Mount Hagen Town Authority Act 1989 (Western Highlands), s 33.

Held

(1) Provincial governments may validly provide for the management of towns under the Organic Law on Provincial Government (Ch No 1) and nothing in the Local Government Act (Ch No 57) excludes that power.

(2) The Mount Hagen Town Authority Act 1989 (Western Highlands) is therefore a valid act.

(3) The power to "impose fees" contained in s 33 of the Mount Hagen Town Authority Act 1989 (Western Highlands) comprehends power to raise in a fair and equitable manner, general revenue to aid the operation of the Authority.

(4) Fees for the provision of services in the town which services would benefit all persons living, trading and conducting business in the town, were, despite being called trading licence fees, within power and recoverable where properly levied.

Writ of Summons

These were proceedings in which the Mount Hagen Town Authority sought to recover fees levied for town services.

Counsel

M Maladina, for the plaintiff.
I Buru, for the defendant.
Cur adv vult

24 August 1990

WOODS J: The plaintiff is claiming trading licence fees from the defendant for the period July 1989 to June 1990 in connection with the defendant’s operation of a retail supermarket in Mount Hagen.

The plaintiff, the Mount Hagen Town Authority, was established under the Mount Hagen Town Authority Act, an Act of the Western Highlands Provincial Assembly which was so certified on 6 April 1989. On that day the Authority commenced operations and has been functioning ever since. Until this case was heard by me there had been no suggestion that the Authority was not empowered to so act from that date, however counsel for the defendant has now submitted before me that the Authority’s operations have been invalid all this time. This submission is based on the wording in the Preamble to the Act as to when the Act is to come into operation and an apparent inconsistency with the Western Highlands Gazette of 11 April 1989.

The Preamble states as follows:

"Made by the Western Highlands Provincial Assembly to come into operation on a date to be fixed by publication of notice in the Western Highlands Provincial Gazette by the Premier Acting with and in accordance with advice of the Provincial Executive Council."

The Western Highlands Gazette of 11 April 1989 published a notice by the Speaker of the Provincial Parliament declaring that the Town Authority Act was certified on 6 April 1989.

There is no denying that the Authority has been in operation and has in effect been running the town since then. Because of certain doubts expressed, the Western Highlands Provincial Assembly in June this year passed an Act to clarify the position of the Mount Hagen Town Authority as from April 1989.

Counsel for the defendant made a submission that there was no power under the Organic Law on Provincial Government (Ch No 1) to legislate for town authorities. The submission suggested that the running of towns can only be done by local government councils under the Local Government Act (Ch No 57) and that the Local Government Act is an exhaustive law and adequately provides for the government of any areas whether urban or rural. I find nothing in the Local Government Act to suggest that it is an exhaustive law and excludes the power of provincial governments to otherwise provide for the management of towns.

The defendant has accepted the services provided by the Mount Hagen Town Authority for over a year now so cannot now say these services should never have been given. The reality of the situation is that the defendant and presumably every other organisation or business in the town has accepted the role of the Authority as there has been no challenge till now, over a year after the Authority commenced its operation. I find that there is no detriment to anybody such that this Court should intervene and find that the gazettal in April 1989 is null and void and that the clarifying Act of June 1990 is inoperative.

In the circumstances, I therefore declare that the Mount Hagen Town Authority has been validly in existence since on or about 6 April 1989.

The defendant further submits that the plaintiff has no powers to charge what it has called trading licence fees or what it is now calling town service fees. First, it is contended that a trading licence fee being merely a fee for a licence is and can only be levied under the Trading Act (Ch No 324). The Trading Act is quite clearly an Act to ensure that the only persons allowed to conduct business in Papua New Guinea or to "trade" shall be people who are so approved by the Government. However, the fees charged by the Authority as what I may agree is a misnomer "Trading Licence Fees" are quite clearly fees for the provision of services in the town which services are to the benefit of all persons living, trading and conducting business in the town.

The Town Authority Act gives very wide powers to charge fees or rates. In s 32 such fees are directly related to the provision of particular services and such would, for example, include a specific fee for a garbage service, however s 33 gives a much wider power to impose fees which would be to raise general revenue to aid the operation of the Authority. Of course, any such fees would have to be imposed equitably and fairly according to some stated criteria and, of course, the Authority would have to consider whether such fees will attract or discourage people from operating businesses. I am satisfied that the trading licence fee which is in effect a town service fee is an allowable fee within s 33 of the Act.

This matter was commenced by a writ of summons claiming a specific sum. At this stage however, I have trouble with how the fee levied is calculated. The summons refers to one trading licence fee under the Trading Act but a figure based on three operations under the Authority’s fee schedule. I am not satisfied on the material before me that the figure of K1,300 is properly levied. This fee is stated to be for a supermarket, butchery and Kai-bar. However it is clear that the butchery is part of the supermarket; it is not a separate business. The word super in supermarket means everything. So I can see the basis for a supermarket fee of K500 and a Kai-bar fee of K300 and the Trading Act fee of K6.

I therefore order judgment for the plaintiff in the sum of K806.

Judgment for plaintiff

____________

Lawyer for the plaintiff: M Maladina.
Lawyers for the defendant: Warner Shand.