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Koima v Independent State of Papua New Guinea [2014] PGNC 48; N5568 (14 April 2014)

N5568

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS (HR) NO 03 OF 2014

BETWEEN

JOHN KOIMA
First Plaintiff

AND

JOMAR TRADING LIMITED
Second Plaintiff

AND

ROMILY KILA PAT, in his capacity as Secretary for Lands and a Delegate of the Minister for Lands & Physical Planning
First Defendant

AND

BENJAMIN SAMSON, in his capacity as the Acting Registrar of Titles, Department of Lands & Physical Planning
Second Defendant
AND

HON. BENNY ALLAN, MP,
Minister for Lands & Physical Planning
Third Defendant

AND

THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Fourth Defendant

AND

Waigani: Makail, J
2014: 03rd & 04th April

PRACTICE & PROCEDURE – Ex parte interim injunction – Setting aside of – Principles of – No serious issue to be tried – Balance of convenience weigh against continuation of interim injunction – Damages an adequate remedy – Constitution – s. 155(4).

HUMAN RIGHTS – Alleged breaches of human rights – Breaches of Constitutional rights – Protection from unjust deprivation of property – Harsh and oppressive acts – Right to adequate and reasonable compensation – Constitution – ss. 41, 53 & 58.

PROPERTY LAW – Compulsory acquisition of land – Land for public purpose – Construction of road flyover – Issuance of notice to treat – Effect of – Land Act, 1996 – ss. 7, 12 & 13.

No cases cited:

Counsel:

Mr J Kolo, for Plaintiffs
Mr M Mukwasepu, for First, Second and Third Defendants
No appearance for Fourth Defendant

RULING
04th April, 2014

1. MAKAIL, J: This case is about the State needing land to construct a new road known as a flyover in the city of Port Moresby from the Jacksons International Airport to Waigani. The flyover will run through the suburb of Erima and is intended to serve as an alternative route for commuters and public travelling to and from the Jacksons International Airport as well as to ease traffic congestion at the Erima round-about. The State also considers it as a priority project which must be completed before 2015 to provide road access to accommodation and sporting venues for more than 4,000 athletes who will be attending the 2015 Pacific Games in Port Moresby. As a result, residents living along the proposed flyover route were asked to return the land to the State.

2. The plaintiffs were one of those residents affected by the proposed road project. The first plaintiff is the registered proprietor of allotment 2, section 116 and resides on the land with his family along Kookabarra Street. He runs a retail shop, mini-food bar and a set of units for accommodation under the management of the second plaintiff company. It is not disputed that the Minister for Lands and Physical Planning ("Minister") through his delegate, the Secretary for the Department of Lands and Physical Planning issued a Notice to Treat ("Notice") under s. 13 of the Land Act, 1996 to the residents and a copy was served on the plaintiffs on 06th December 2013.

3. By this Notice, the plaintiffs were given two months to state their interest in the land and either sell or surrender the land to the State. After two months, on 12th March 2014, the Secretary as delegate of the Minister published a notice in the National Gazette confirming that the land had been compulsorily acquired by the State for the purpose of building the flyover.

4. There is also no dispute that on 27th January 2014, the plaintiffs engaged a private valuer to value the land and improvements. The value was K6.4 million. On 16th January 2014, the State also engaged the Valuer General to value the land and improvements. The value was K4.65 million. Both valuations were presented to the Secretary for consideration. By a letter to the plaintiffs dated 24th February 2014, the Secretary offered K215,000.00 for the land and K615,000.00 for the improvements.

5. There appeared to be two valuations done by the Valuer General because the Secretary's offer was also based on a valuation done by the Valuer General. As an alternative to the improvements, the Secretary offered to relocate the plaintiffs to a land and build a house at no costs to the plaintiffs. In the meantime, the Secretary offered to move them to an alternative accommodation at K650.00 per week to be paid by the State. The same kind of proposal was made to the other affected residents.

6. The plaintiffs rejected the Secretary's offers and maintained their offer based on the value of K6.4 million. In the alternative, they said that, they would accept the offer of K4.65 million based on the Valuer General's assessment. On 20th February 2014, the National Capital District Commission ("NCDC") issued a Demolition Notice to them to remove improvements put on the land. On 04th March 2014, the plaintiffs informed the Secretary and maintained their position. At the same time, they commenced proceedings in the National Court in proceedings WS (HR) No 102 of 2014 against the NCDC and on 13th March 2014, obtained an interim injunction to restrain it from carrying out the demolition exercise. That proceeding was subsequently withdrawn. The parties were unable to reach an agreement on the amount.

7. On 19th March 2014, the plaintiffs commenced this proceeding and on 21st March 2014, invoking the inherent powers of the Court under s. 155(4) of the Constitution obtained an ex parte interim injunction to restrain the State from evicting them from the land. They sought to have it perfected while the defendants sought to have it set aside. The plaintiffs contended that as the State had acquired the land pursuant to the Notice and that they and the State had yet to agree on an adequate and reasonable amount of compensation, they stood the risk of being evicted at the will of the State. The ex parte interim injunction must be perfected to restrain the defendants from evicting them until the determination of the proceeding or agreement is reached with the State on the amount of compensation.

8. They further contended that the balance of convenience favour the perfection of the ex parte interim injunction because they would have no place to go if they were evicted from the land. They said that they have lived on the land for a very long time and it would be difficult for them to leave behind what they have built over the years. They accepted that they are willing and support the State's cause to reclaim the land but want the State to adequately compensate them.

9. Mr Mukwesipu of counsel representing the Minister, Secretary and Registrar of Titles, raised a number of objections in relation to procedural matters concerning the appropriateness of the proceeding to challenge the decision and/or actions of the defendants to compulsorily acquire the land. He submitted that the plaintiff sought to have the Court review the process by which the State had compulsorily acquired the land under the Land Act 1996 and they should have commenced judicial review proceedings under O 16 of the National Court Rules.

10. The other was the relief. He submitted that first plaintiff sought a declaration to assert his title to the land and an order for compensation but these were unnecessary because the State did not deny that the first plaintiff was the registered proprietor of the land. The State had compulsorily acquired the land by following the process under ss. 12 & 13 of the Land Act 1996 and by virtue of s. 14 of the same Act, the first plaintiff's interest was converted into compensation. Further, the State did not deny that and so, the outstanding issue was the amount which could be amicably worked out between the parties. But that disagreement must not stop the State from using the land to build the flyover.

11. He referred the Court to ss. 20, 21, 22, and 23 of the Land Act 1996 and submitted that these provisions preserved the plaintiffs' right to compensation and claim for compensation either through agreement or court proceeding in the National Court if parties were unable to agree on the amount. He submitted that this process has not been exhausted and the plaintiffs must pursue it.

12. He further submitted that it is the amount that is the subject of the dispute between the parties and the principles on injunctions are well settled. The Court's power to perfect the ex parte interim injunction is discretionary and the onus is on the plaintiffs to establish that there is a serious issue to be tried, the balance of convenience favour its continuation and damages would not be an adequate remedy. On these principles, he submitted that the plaintiffs have failed to establish any and the discretion should not be exercised in their favour.

13. The land on which the plaintiffs reside is the property of the State. This is what s. 4 of the Land Act 1996 says. It states:

"4. NATIONAL TITLE TO LAND.

(1) All land in the country other than customary land is the property of the State, subject to any estates, rights, titles or interests in force under any law.

(2) All estate, right, title and interest other than customary rights in land at any time held by a person are held under the State."

14. The State has a right to acquire or repossession the land and may do so in two ways; one by agreement and the other by compulsory process. These two modes of acquisition are set out in s. 7 of the Land Act 1996. It states:

" 7. MODES OF ACQUISITION.

The Minister may, on behalf of the State, acquire land–

(a) by agreement; or

(b) by compulsory process,

in accordance with this Act."

15. The State used the compulsory process to acquire the first plaintiff's land. This process is set out in ss. 12 & 13 of the Land Act 1996. Section 12 states:

"12. COMPULSORY ACQUISITION.

(1) The Minister may, on behalf of the State–

(a) after the expiration of a period of two months after the service of a notice to treat, or of notices to treat under Section 13, in relation to any land; or

(b) at any time where, after diligent search and inquiry, he is satisfied that the owner of the land cannot be located; or

(c) at any time after he has given a certificate under Section 13(6) in relation to any land,

by notice in the National Gazette, declare that the land, other than any interest in respect of which a notice to treat has been withdrawn, or any chattel, is acquired by compulsory process under this Act for a public purpose specified in the notice.

(2) On the publication of a notice under Subsection (1), the land or chattel to which the notice applies is–

(a) vested in the State; and

(b) freed and discharged from all interests, trusts, restrictions, dedications, reservations, obligations, contracts, licences, charges and rates."

16. Section 13 states:

"13. NOTICE TO TREAT.

(1) The Minister shall not acquire land by compulsory process under this Act unless he has first caused to be served on each of the owners of the land, or such of them as can, after diligent inquiry, be ascertained, a notice inviting the person on whom the notice is served to treat with the Minister for the sale or surrender to the Minister, on behalf of the State, of his interest in the land.

(2) A person served with a notice to treat in respect of land shall, not later than two months after the service of the notice, provide the Minister with particulars of–

(a) the interest claimed by him in the land; and

(b) the amount for which he is agreeable to sell his interest in the land; and

(c) the name and address of any other person known to him to have an interest in the land and the nature of that interest.

(3) On receipt of the particulars referred to in Subsection (2), the Minister may–

(a) treat with the person providing the particulars for the acquisition of his interest by agreement; and

(b) notwithstanding anything in this Act, enter into an agreement with that person for the acquisition.

(4) The Minister may, by written notice to a person served with a notice to treat, withdraw the notice to treat.

(5) Where the owner of an interest in land, who has provided the particulars referred to in Subsection (2), suffers loss by reason of the notice to treat having been given and withdrawn, the State is liable to pay to him such compensation as is determined by agreement between the owner and the Minister or, in the absence of agreement, by action as determined by a court of competent jurisdiction.

(6) This Section does not apply in a case where the Minister certifies that there are special reasons why the Section should not apply."

17. There is no dispute that the State followed this process under ss. 12 and 13 (supra). The outstanding issue between the parties is the amount of compensation. From my reading of these two provisions, there is nothing in them to suggest that the State must settle and pay the amount of compensation to the plaintiffs before it acquires the land. Given that the State had acquired the land by compulsory process, it supports the State's contention that the plaintiffs must return the land and their interest is converted to compensation. For these reasons, I accept Mr Mukwesipu's submission that there is no serious issue to be tried in this case.

18. The Court must balance two competing interests here and decide whose interest is more important. On the one hand, there is the plaintiffs' interest. The plaintiffs have lived on the land for a long time and have made substantial improvements including running a commercial business in real estate and retail shop. The plaintiffs' interests are personal and commercial in nature. On the other hand, the State needs the land to construct a flyover. The State needed the land for construction of a public road for public use. As I mentioned in the beginning, the flyover will run through the suburb of Erima and is intended to serve as an alternative route for commuters and public travelling to and from the Jacksons International Airport as well as to ease the traffic congestion at the Erima round-about.

19. Anyone driving during peak hour between 7 and 8 in the morning or 4 and 6 in the afternoon at Erima round-about would no doubt witness a traffic jam along that stretch of road. The reason; the road which is supposed to be a freeway is insufficient to cater for the ever increasing number of motor vehicles on the road. In my view this is one factor which sways me to the State's side.

20. The other reason is that the State considers the flyover as a priority project which must be completed before 2015 to provide road access to accommodation and sporting venues for more than 4,000 athletes who will be attending the 2015 Pacific Games in Port Moresby. In my opinion if the interim injunction is allowed to remain, it will delay the completion of the project. It is my further opinion that since the Pacific Games will be held in 2015, every minute is crucial and every minute of delay is detrimental to the project. It will delay the completion of the project and inconvenience the athletes and public during the Pacific Games. For these reasons, I am persuaded by the State's contention that the balance of convenience does not favour the continuation of the interim injunction.

21. In relation to the plaintiffs' claim that their Constitutional rights under ss. 53 and 58 of the Constitution have been breached by the State, with respect, this was neither a case of unlawful deprivation of property nor a case of the State and its officials being harsh and oppressive in dealing with the plaintiffs under s. 41 of the Constitution, such that the plaintiffs' interests in the land should be protected by way of an injunction.

22. What must be appreciated is that the land is the property of the State: s. 4 (supra). It was leased by the State to the plaintiffs and the State had the right to ask for its return. This was what had happened and I accept Mr Mukwesipu's submission that the plaintiffs' interest thereafter is converted to compensation: s. 14 (supra). Their right to compensation is preserved and intact. If they are unable to reach an agreement on the amount, they have a right to commence court proceedings in the National Court to claim it: ss. 20, 21, 22, and 23 (supra).

23. There is no dispute that various amounts had been put forward and discussed by the parties and for this reason, I am satisfied that an appropriate remedy for the plaintiffs is damages. The process for determining the amount is fairly clear and Mr Mukwesipu has succinctly set it out in his submission. If the parties are unable to agree on the amount with the State, the plaintiffs have recourse to have it assessed in the National Court by commencing proceedings in the National Court pursuant to ss. 20, 21, 22 and 23 of the Land Act 1996.

24. For these reasons, I am not satisfied that the Court's discretion be exercised in favour of the plaintiffs. I order that the ex parte interim injunction of 21st March 2014 be set aside forthwith and the matter is adjourned to a date to be fixed for directions hearing. Costs shall be in the cause.

Ruling and Orders accordingly.
_______________________________________________________________

Kolo & Associates: Lawyers for the Plaintiffs
Gadens Lawyers: Lawyers for the First, Second & Third Defendants
Acting Solicitor-General: Lawyers for the Fourth Defendant