N4005

PAPUA NEW GUINEA
IN THE NATIONAL COURT OF JUSTICE

WS NO 202 OF 2010

EDDIE TARSIE FOR HIMSELF AND IN HIS CAPACITY AS WARD COUNCILLOR OF WARD 3,
SAIDOR LOCAL-LEVEL GOVERNMENT
First Plaintiff

FARINA SIGA, FOR HIMSELF AND IN HIS CAPACITY AS WARD SECRETARY OF WARD 3,
SAIDOR LOCAL-LEVEL GOVERNMENT
Second Plaintiff

PETER SEL
Third Plaintiff

POMMERN INCORPORATED LAND GROUP NO 12591
Fourth Plaintiff

SAMA MELAMBO FOR HIMSELF AND AS CHAIRMAN OF POMMERN INCORPORATED LAND GROUP NO 12591
Fifth Plaintiff

V

RAMU NICO MANAGEMENT (MCC) LIMITED
First Defendant

MINERAL RESOURCES AUTHORITY
Second Defendant

DR WARI IAMO IN HIS CAPACITY AS DIRECTOR OF ENVIRONMENT
Third Defendant

DEPARTMENT OF ENVIRONMENT AND CONSERVATION
Fourth Defendant

THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Fifth Defendant

Madang: Cannings J
2010: 7, 11 May

PRACTICE AND PROCEDURE – whether the court should make orders for decision of certain questions separately from other questions, before trial – National Court Rules, Order 10, Rule 21 (order for decision).

The first defendant, supported by other defendants, applied under Order 10, Rule 21 of the National Court Rules for orders that there be a decision by the court on two questions arising in the proceedings, before the trial.

Held:

(1)	Examples of circumstances in which it would be appropriate to order that there be a decision on questions before a trial are where there is a preliminary question of fact or law that is critical to the disposition of the proceedings, so that if decided one way, it will necessarily dispose of the proceedings; where resolution of separate questions may result in early resolution of the proceedings or by narrowing the disputed issues, avoid additional expenses or delay; where issues are clearly separable; or where a liability issue can be determined ahead of the final assessment of damages (MAPS Tuna Ltd v Manus Provincial Government (2007) SC857).

(2)	The two proposed questions are not preliminary questions that are critical to disposition of the proceedings. Nor are they likely to result in early resolution of the proceedings. The questions which the defendants propose for prior determination are too interwoven with the facts to make it efficacious to have them determined separately prior to the trial. The application was accordingly refused.

Cases cited

The following cases are cited in the judgment:

Papua New Guinea Cases

MAPS Tuna Ltd v Manus Provincial Government (2007) SC857
New Britain Oil Palm Ltd v Vitus Sukuramu (2008) SC946
Tarsie v Ramu Nico (MCC) Ltd (2010) N3960
Tarsie v Ramu Nico (MCC) Ltd (2010) N3986
Tarsie v Ramu Nico (MCC) Ltd (2010) N3987
Timothy Lim Kok Chuan v Simon Goh Say Beng (2004) N2753
Vitus Sukuramu v New Britain Palm Oil Ltd (2007) N3124

Overseas Cases

Allen v Gulf Oil Refining Ltd [1981] AC 1000
Saki v Ross Mining (Solomon Islands Ltd) [1999] SHBC 61

Counsel

T Nonggorr, for the plaintiffs
C Scerri QC, I Molloy & G Gileng, for the first defendant
A Mana, for the second defendant
L Kandi, for the third, fourth & fifth defendants

11 May, 2010

1. CANNINGS J: The first defendant, Ramu Nico Management (MCC) Ltd ("MCC"), has applied for orders that there be a decision by the court on two questions arising in the proceedings, before the trial. Their application is supported by all other defendants but opposed by the plaintiffs. This is a ruling on the application.

ORDER 10, RULE 21

2. The application is made under Order 10, Rule 21 (order for decision) of the National Court Rules, which states:

The Court may make orders for—

(a) the decision of any question separately from any other question, whether before, at or after any trial or further trial in the proceedings; and

(b) the statement of a case and the question for decision.

THE TWO QUESTIONS

3. The defendants want the court to decide:

1 Whether an activity that was permitted by an approval, permit or licence under the Environmental Planning Act Chapter No 370 (the repealed Act) that:

(a)	had not commenced at the time the Environment Act 2000 came into force on 1 January 2004; and

(b)	was an activity that would constitute an offence under the Environment Act 2000, 

is saved by the provisions of Section 136 of the Environment Act 2000?

2 Whether an activity to be commenced by the first defendant being the deposit of tailings into the Astrolabe and Basamuk Bays is lawful and does not constitute a public or private nuisance in circumstances where such activity is in compliance with the:

(a)	Environment Act 2000; and/or

(b)	approval, permit or licence given under a valid law?

GUIDELINES FROM PREVIOUS CASES

4. In MAPS Tuna Ltd v Manus Provincial Government (2007) SC857 the Supreme Court (Hinchliffe J, Gavara-Nanu J, Lenalia J) gave examples of when it would be appropriate to order that there be a decision on questions before a trial:

•	Where there is a preliminary question of fact or law that is critical to the disposition of the proceedings, so that if decided one way, it will necessarily dispose of the proceedings.

•	Where resolution of separate questions may result in early resolution of the proceedings or by narrowing the disputed issues, avoid additional expenses or delay.

•	Where issues are clearly separable.

•	Where a liability issue can be determined ahead of the final assessment of damages.

5. The Supreme Court adopted the analysis of Order 10, Rule 21 undertaken by Gavara-Nanu J in Timothy Lim Kok Chuan v Simon Goh Say Beng (2004) N2753, where his Honour also gave examples of when it would not be appropriate to order that there be a decision on questions before a trial:

•	Where the question proffered for separate determination involves the whole subject matter of the proceedings.

•	Where the question involves alternative causes of action or defences.

•	Where the question to be determined would require findings of fact on matters likely to be contentious on remaining issues in the proceedings.

•	Where the question may involve the credibility of witnesses which is material to the remaining issues in the proceedings (and thus would require the question to be dealt with by another judge).

•	Where the parties propose that the question be determined on the basis of limited agreed facts.

6. The above examples are not exhaustively prescriptive of the circumstances in which it would be appropriate, or inappropriate, to order that there be a decision on questions before a trial. They nevertheless provide useful guidelines. If the circumstances of a case seem to fit into one or more of the scenarios in the first list, the court should be inclined to make an order under Order 10, Rule 21. If the case seems to belong more in the second list, it will probably be inappropriate to make such an order.

SHOULD THE ORDERS BE MADE?

Defendants' position

7. The defendants assert that the two questions they seek to pose are threshold questions of law that are critical to disposition of the proceedings, so that if decided one way, they will necessarily dispose of the proceedings. They propose, it appears, to argue both questions in the affirmative. As to question 1, it appears that they will argue that an activity permitted by a permit under the repealed Environmental Planning Act is saved by Section 136 of the Environment Act 2000, even if the activity had not commenced on 1 January 2004 and would constitute an offence under the Environment Act 2000. As to question 2, their argument apparently will be that if the deposit of tailings into Astrolabe and Basamuk Bays is in compliance with the Environment Act 2000 or an approval under a valid law, that activity will be lawful and will not constitute a public or private nuisance.

8. Mr Scerri, for MCC, submitted that resolution of these questions may well result in early resolution of the entire proceedings and avoid considerable additional expenses and delay. He submitted that the issues are clearly separable and that if the questions are decided in the manner they contend for, a trial on the facts will be unnecessary. He pointed out that the plaintiffs are, in addition to seeking a permanent injunction to prevent the defendants committing the alleged nuisances, seeking punitive damages, so this is a case in which the question of liability can be determined first, before embarking on what might turn out to be the unnecessary task of assessing damages.

9. The defendants say the hearing of their two questions will probably occupy only one day of the court's time. Whereas if the case goes straight to trial without determination of the questions, it will take much longer to complete – a number of days, perhaps weeks – as both sides will want to call expert witnesses to give scientific evidence which will no doubt differ. If the questions are decided against the defendants, nothing will have been lost as the questions will need to be decided at some stage. Granting MCC's application would be all upside, with no downside, Mr Scerri submitted.

10. I will assess these submissions in relation to each of the proposed questions.

The proposed question 1

11. I can see that it poses a discrete question of law, requiring an interpretation of Section 136 of the Environment Act 2000. It appears to be the sort of question that could be neatly and authoritatively determined and that it would be of assistance to all parties to have it resolved. But I am not convinced that it would determine the outcome of the proceedings.

12. If the court decided the question in the way contended for by the defendants, it would still be necessary to decide an alternative proposition raised by the plaintiffs: that, even if the activity of operating a deep sea tailings placement system is permitted, the environmental harm that would result from operation of that activity has not been permitted. The plaintiffs want to argue that operation of the deep sea tailings placement system was approved on the basis that there would be no environmental harm. Whether that proposition has substance or whether it is a trivial issue that would involve the court in a hair-splitting exercise (distinguishing between what activity is permitted and what environmental harm is permitted) cannot be determined now; and would not be determined if the court were to confine its attention to the proposed question 1.

13. The proposed question 1 cannot properly be regarded as a preliminary question of law, critical to the disposition of the proceedings. If decided in the way contended for by the defendants, it will not dispose of the proceedings. It will not result in early resolution of the proceedings. It might narrow down the issues in dispute but I do not think it will go far towards avoiding additional expenses or delay. So, the defendants have not made out a strong case for having the proposed question 1 made the subject of an order for early decision.

The proposed question 2

14. The first comment I make on this question is that it is vague. Asking "whether … the deposit of tailings into Astrolabe and Basamuk Bays is lawful and does not constitute a public or private nuisance" begs many other questions, such as: What is the proposed method of deposit of tailings? What is the nature and extent of the approval that has been given? What are the elements of the torts of public nuisance and private nuisance?

15. The second comment to make is that it seems the same sort of general question that earned the disapprobation of the House of Lords in the leading case of Allen v Gulf Oil Refining Ltd [1981] AC 1000. There, the question posed was 'Can the defendants rely on the Gulf Oil Refining Act as having authorised the construction and operation of an oil refinery at Waterston'. In a sense, it was a straightforward question that admitted of a straightforward answer: yes, the defendants can rely on that Act to authorise the construction and operation of the refinery. But deciding the question as it was posed was not of much help to anyone as the real question was not whether the defendants could construct and operate the refinery but whether the Act of Parliament that they relied on gave them authority to create the nuisance complained of by the plaintiffs, ie whether the statutory authority they possessed provided a defence to the claims of nuisance.

16. The third comment to make is that the proposed question tries to compress into one ostensibly simple question a number of questions of fact and law that can only be properly determined at a trial. The question proffered for separate determination involves the whole subject matter of the proceedings, which is one of the circumstances envisaged by Gavara-Nanu J in Timothy Lim Kok Chuan v Simon Goh Say Beng (2004) N2753 as being inappropriate for an order for separate determination of questions before trial.

17. The plaintiffs are wanting to argue, at a trial, that the proposed deep sea tailings placement system will cause a certain type of environmental harm, which will constitute a public nuisance and private nuisance (these being types of civil wrongs or torts that have been adopted as part of the underlying law of Papua New Guinea). They also want to argue, it appears, that the defendants, particularly MCC, although they might be authorised to do certain things, including, perhaps, construct a deep sea tailings placement system, have not been authorised to do the sort of environmental harm that the plaintiffs claim will be caused by MCC's activities. They want to argue that that sort of environmental harm is not the inevitable consequence of any statutory approval that has been given to MCC. The plaintiffs appear willing to concede that it is possible for a defendant to a nuisance action to succeed with a defence of statutory authorisation but apparently want to argue that it is for the defendant to prove that it has statutory authorisation and that the nuisance or environmental harm it will create is the inevitable consequence of the statutory authorisation.

18. I am not expressing a view on whether these are sound arguments other than to say that in terms of the common law of nuisance the types of arguments foreshadowed by the plaintiffs do not seem outlandish or unreasonable. I have already decided that the plaintiffs have raised triable issues by granting the plaintiffs' application for an interim injunction (Tarsie v Ramu Nico (MCC) Ltd (2010) N3960), clarifying the effect of the injunction (Tarsie v Ramu Nico (MCC) Ltd (2010) N3986) and refusing the defendants' application to set it aside (Tarsie v Ramu Nico (MCC) Ltd (2010) N3987).

19. This case involves significant questions of fact and law. There are very few cases on the law of nuisance that have been decided by the courts in PNG. There are few, if any, cases on the Environment Act 2000. The courts have not, it seems, been called upon to determine the appropriateness of the common law of nuisance to the circumstances of Papua New Guinea. Only a few cases have addressed the effect of the Underlying Law Act 2000 on the common law (eg New Britain Oil Palm Ltd v Vitus Sukuramu (2008) SC946; Vitus Sukuramu v New Britain Palm Oil Ltd (2007) N3124). And then there is the question of how the provisions of the Environment Act interact with the underlying law. It would seem also that this sort of case cannot be resolved without a consideration of the National Goals and Directive Principles set out in the Constitution, particularly Goal No 4: Natural resources and environment.

20. As to the questions of fact, I accept what Mr Scerri has said about the prospect of the court being faced with conflicting expert, scientific opinion. It is possible that it will take some time for the court to receive this evidence. But I really cannot see any proper way around this. Mrs Nonggorr referred in her submission to a decision of the High Court of the Solomon Islands, Saki v Ross Mining (Solomon Islands Ltd) [1999] SHBC 61. Palmer J rejected the same sort of application for a pre-trial determination of various questions that I am dealing with. It was a nuisance case brought by landowners against a mining company and the defendants sought to get the question of statutory authorisation or statutory immunity determined at a preliminary hearing. His Honour stated:

It follows, the question whether statutory immunity applies by virtue of those provisions cannot be decided in isolation of the facts and circumstances surrounding the operations of the mine. Only after the facts have been determined at trial can it be determined whether the holder had complied with those requirements and therefore is protected from the claims of the plaintiffs by the defence of statutory immunity. In this case the plaintiffs alleged to the contrary and those allegations entail mixed questions of law and fact. The defence of statutory immunity accordingly will have to be determined at trial together with all the relevant facts to be adduced and determined.

21. The same approach should apply in the present case. Only after determining the nature and extent of the nuisance, if any, that will be created by operation of the deep sea tailings placement system – which will primarily be a question of fact – and then comparing that with the nature and extent of the authority given to MCC – which will involve both questions of law and fact – would it seem proper to determine whether MCC and the other defendants have a defence to the claims of nuisance. The proposed question 2 is too interwoven with the facts – which have not yet been established – to make it efficacious to have it determined separately prior to the trial. I consider that it would be a futile and probably counterproductive exercise to do so. The defendants are concerned about the prospect of delay in having this case resolved. The concern is legitimate but I think that granting the application would enhance the prospect of delay.

Conclusion

22. I see little merit in ordering that the proposed question 1 be the subject of separate determination before trial and no merit in treating the proposed question 2 in that way. The defendants have failed to persuade the court to make the orders sought so the application will be refused.

ORDERS

(1)	The application under Order 10, Rule 21 of the National Court Rules for orders that there be a decision by the court on two questions arising in the proceedings, before the trial, pursuant to a notice of motion filed by the first defendant on 23 April 2010, is refused.

(2)	The question of costs is reserved.

(3)	Time for entry of this order is abridged to the date of settlement by the Registrar which shall take place forthwith.

Rulings accordingly.
____________________________

Nonggorr William Lawyers: Lawyers for the Plaintiffs 
Posman Kua Aisi Lawyers: Lawyers for the First Defendant 
Allens Arthur Robinson: Lawyer for the Second Defendant 
Solicitor-General: Lawyer for the Second, Third, Fourth & Fifth Defendants