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Assemblies of God v Dekena [2014] PGNC 352; N6385 (10 November 2014)

N6385

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS (JR) 41 of 2011

BETWEEN:

ASSEMBLIES OF GOD, BOROKO ASSOCIATION INC
Plaintiffs

AND:
HON. LUCAS DEKENA, Minister for Lands & Physical Planning
First defendant

AND:
ROMILY KILA PAT, Acting Secretary, Department of Lands &
Physical Planning

Second defendant

AND:

THE INDEPENDENT STATE OF PAPUA NEW GIUNEA

Third defendant

AND:

TRINCO NO. 6 PTY LTD

Fourth defendant

AND:

DYNAMIC DEVELOPMENT LIMITED

Fifth defendant

Waigani: Gavara-Nanu, J

2014: 10 November

PRACTICE AND PROCEDURE – Consent Orders – Meaning thereof – Consent Orders obtained ex-parte – Application to set aside – National Court Rules; O 1 r 8 – Orders entered irregularly – Orders set aside - Costs.

Cases cited:
Waluka v. Philip Taufuso and West New Britain Provincial Administration (2009) N3848

Other cases cited:
Chardless-Chardless v. Nicholson [1942] 2 K.B 321
Thorne v. Smith [1947] K.B 307

Counsel:
A. Donigi, for the Plaintiffs
B. Kulumbu, for the first to third Defendants
B. Frizzel, for the fourth and fifth Defendants

14^th November, 2014

1. GAVARA-NANU J: This is an application by the fourth and fifth defendants (applicants) made pursuant to a notice of motion filed on 17 July, 2014, seeking orders to set aside the ex-parte Consent Orders endorsed by the Court on 17 October, 2013 and entered on 18 October, 2013. The application is made under Order 1 r 8 of the National Court Rules.

2. The applicants dispute the validity of the Consent Orders on the basis that the purported Consent Orders were obtained in their absence, and they are not named in the Orders and that they have not signed and endorsed the Consent Orders. Only the plaintiffs, first, second and third defendants are named in the Orders and they are the only parties who signed the Orders. The Orders are titled "Draft Consent Orders", they are undated.

3. The proceeding concerns the ownership of a certain piece of land in the National Capital District, which was previously owned by the plaintiffs. The applicants now hold the title and are the registered proprietors. The plaintiffs lost their title when their lease was forfeited by the State. In this proceeding, the plaintiffs are challenging the forfeiture of their lease.

4. I have read the affidavit of Ms. Bathsheba Kulumbu of counsel for the first, second and third defendants sworn on 24 September, 2014. Ms. Kulumbu deposes in the affidavit that the terms of the draft Consent Orders are consistent with what all the parties, including the applicants have discussed and agreed to in their negotiations. Ms. Kulumbu argued that the applicants are therefore bound by the Orders.

5. The real issue before the Court is whether the purported Consent Orders are valid and binding.

6. Ordinarily, consent orders are by their very nature those orders, the terms of which, are agreed to and endorsed by all the parties to a proceeding by signing them. By signing the orders, the parties agree to be bound by their terms.

7. In deciding whether such consent orders are valid and binding, the Court need not look further than the endorsements of the orders by the parties viz; whether the parties have signed the orders: Chardless-Chardless v. Nicholson [1942] 2 K.B 321 and Thorne v. Smith [1947] K.B 307.

8. A fundamental principle regarding valid consent orders is that their terms constitute a binding and an enforceable agreement between the parties. It is important to note that in certain cases, the parties may pursuant to the terms of the orders even agree to abandon and forgo their rights or interests in the proceeding as part of the terms of settlement between the parties. The terms of consent orders can also create enforceable rights and obligations for the parties.

9. Having regard to these principles, following fundamental errors and defects are noted in regard to these draft Consent Orders. First, they are not signed by the applicants. Second, the applicants are not named in the Orders. Third, the purported Consent Orders were endorsed by the Court in the absence of the applicants. The essence of these is that the applicants are not parties to the purported Consent Orders and therefore cannot be bound by their terms.

10. In the circumstances, all that the applicants need to show to be granted the relief they are seeking, is that they have not signed the orders and that is where the matter should end. It is not necessary for the applicants to satisfy the other usual requirements for the setting aside of orders. For example, they do not have to explain any delay in making this application, if there is a delay, and whether there is a reasonable explanation for the delay; whether there is a defence on the merit and why the orders were allowed to be entered.

11. In Titus Waluka v. Philip Taufuso and West New Britain Provincial Administration (2009) N3848, the Court said a draft consent order should be endorsed by the Court only when all conventional practices and requirements are followed and met. I respectfully concur with this view. The conventional practice and requirement of consent orders is that their terms be agreed to and endorsed by all the parties to the proceeding by signing them. This requirement is mandatory because it goes to the jurisdiction of the Court. It follows that in this case, the Court lacked jurisdiction when it endorsed the Consent Orders.

12. It is important to note from the terms of the Draft Consent Orders that if they are enforced, the applicants would relinquish their title and proprietary rights on the property. The draft Consent Orders are in that regard clearly prejudicial to the applicants.

13. The Court having lacked jurisdiction when it endorsed the Consent Orders, the entry of the Orders was clearly irregular.

14. Consequently, the principal relief sought by the applicants, which is to set aside the Consent Orders, is granted.

15. In regard to costs, it was incumbent on the plaintiffs to ensure that all the parties were duly served with the draft Consent Orders and that they endorsed them by signing them. In this case, the applicants were not aware that the draft Consent Orders were signed by the other parties and subsequently endorsed by the Court and entered.

16. In the result, I order that the applicants’ costs of and incidental to the application be paid by the plaintiffs, first, second and third defendants who are respondents to this application.

17. Orders accordingly.
__________________________________________________________
Public Solicitor : Lawyers for plaintiffs
Solicitor General : Lawyers for first to third defendants
Warner Shand Lawyers : Lawyers for the fourth and fifth defendants