N6476
PAPUA NEW GUINEA 
[IN THE NATIONAL COURT OF JUSTICE]
CIA No. 78 OF 2015

BETWEEN:

EDRICK EWATA
Appellant

AND:
 BODGER SANGETARI
Respondent

Popondetta: Toliken, J.
    2016: 24th March, 29th September

INFERIOR COURTS – Appeal – District Court – Appeal from – Claim for repayment of monies allegedly obtained unlawfully through use of force Special Agriculture and Business Lease – Held by Incorporated Land Group – Leased to Oil Palm Company.
PRACTICE AND PROCEDURE – Defence – Whether commenced by complaint or information – Defendant merely required to raise a defence or make Statement in defence – Cross claim – Fresh claim against complainant – Pleaded as in any  fresh suit  or claim – District Courts Act Ch. 40, ss 28, 140, 145, 153; District Court Regulation, s 24 – 29.
PRACTICE AND PROCEDURE – Jurisdiction – Whether bona dispute to land – Whether District Court exceeded jurisdiction – Land held under 99 years SABL – All customary rights to subject land suspended by operation of law – No dispute to title – Title indefeasible - Dispute over benefits for sub-lease of land – District Court had jurisdiction – Order dismissing Appellant’s claim for repayment confirmed - District Courts Act Ch. 40, s 21(4)f); Land Act 1996, ss 11, 102, Land Registration Act Ch. 191.
PRACTICE AND PROCEDURE – Magistrate makes orders on matters not pleaded in complaint – Substantial error – Magistrate bound by matters pleaded in complaint or defence – Substantial miscarriage of justice – Relevant order quashed – District Courts Act, ss 137, 140.
APPEAL – Partly allowed – Parties to meet own costs.

Cases Cited:
Amatus v Oneill [2012] N4718 

Counsel:
M Geroro, for the Appellants
L B Mamu, for the Respondents 

JUDGMENT ON APPEAL

29th September, 2016
1.	TOLIKEN J:	This appeal is against an order of His Worship, William L Noki; sitting in the Popondetta District Court, dated 26th February 2013, where His Worship dismissed the Appellant’s claim against the Respondent for the return of the sum of K13, 000.00, which the Appellant claimed was obtained by the Respondent unlawfully and with use of force.

2.	 The orders appealed against are:

1)	The claim for return of K13, 000.00 is dismissed.
2)	HOPPL pays the Defendant BODGER SANGETARI whatever money owes to him and the Javunapa Clan members from money held in Trust to pay Landowners of Perombata Mini Estate.
3)	Cost be in the cause.

BACKGROUND FACTS 

3.	The Complainant is the Chairman of the Haintapa Incorporated Land Group whose members are the customary landowners of the land known as Perombata.

4.	Haintapa ILG was granted a 99 year Special Agriculture and Business Lease under Section 102 of the Land Act 1996, on 28th March 2002 to the said land now described as Portion 1978C, Milinch of Sangara, Fourmil of Buna, Northern Province. Perombata had previously been leased to the State by its customary owners represented by Livingston Haembo, Lindsy Wornon Taire and Edrick Ewata under Section 11 of the Land Act. When leasing their land to the State, the customary owners, the Haintapa People, agreed that the State issues a Special Agricultural and Business Lease (SABL) under Section 102 of the Land Act 1996 to Haintapa Land Group Incorporated No. 8402, which was done. 

5.	Subsequently Haintapa entered into an agreement with Higaturu Oil Palm to establish an oil palm estate on the subject land, now known as the Perombata Mini Estate and to sub-lease the land for a fee.

6.	In the succeeding years the Appellant paid a total of K13000 to the Respondent who claimed that he was also entitled to benefits for the lease of the land by Higaturu Oil Palm.  

7.	The Appellant claimed that these sums were obtained through extortion and therefore he commenced proceedings to recover the sum in the District Court on 23 October 2012. 

8.	The District Court rendered its decision on 26th February 2013, dismissing the Appellants claim for K13000. The court, however, further ordered that Higaturu Oil Palm pays the Respondents moneys, payable to him and the Javanupa Clan that are held in Trust from proceeds from the lease of Perombata.

9.	The presiding Magistrate gave very brief reasons for his decision which are:
This is a claim for the return of K13000 allegedly claimed by Defendant and his family. The Dependants are also landowners of Perombata Mini Estate.
The bigger part of the land was planted with Oil Palm while certain areas were left undeveloped to cater for Buffers. However, both the developed and undeveloped is leased to Higaturu Oil Palm, so Javanupa Clan also owns the land in the leased area. 
Court finds on the balance of probabilities that the defendant is also a landowner and is entitled to receive benefits.
10.	The Appellant did not appeal within the stipulated time. Hence he applied for extension of time to appeal. The National Court in Waigani granted his application on 28th July 2015 and ordered that he lodges his appeal within 14 days. The Appellant lodged his appeal on 04th of August 2015 and further complied with conditions precedent.

GROUNDS OF APPEAL

11.	 The Appellant appealed against the 	those orders on the following grounds:
1.	His Worship erred in fact and in law by reaching the 	decision when there no claim before the District Court 	by way of complaint, information or cross-claim 	pleading the payment of monies to the Respondent or 	his clan.
2.	His Worship erred in fact and law  by reaching the 	decision when the Respondents cross claim, if any, 	was time barred pursuant to Section 16 of the Frauds and Limitations Act 1988 having accrued on or about 15 June 2000, and
3.	His Worship erred in fact and in law by deliberating on 	the Respondent's claim contrary to section 21(4)(f) of the District Court Act1963, which bars the District Court to deal with land in which the title is bona fide 	in dispute. 
12.	And the Appellant seeks the following orders -
1.	The Appeal be upheld
2.	The decision of the District Court dated 26th February 		2013 be quashed in its entirety.
3.	The Respondent pays the cost of and incidental to this 		appeal; and
4.	Any further or other orders as the Honourable Court 		deems fit.
ISSUES
13.	The following issues arise for my determination in this appeal:

1.	Whether or not there was a claim before the District Court by way of a complaint, information or cross-claim pleading for monies to the respondent or his Clan?
2.	Whether or not the Respondent’s cross-claim, if any, was time-barred pursuant to Section 16 (1)  of the Frauds and Limitation Act 1988 having accrued on or about 15 June 2000?
3.	Whether or not the District exceeded its jurisdiction under Section 21(4)(f) of the District Courts Act 1963, which bars the District Court to deal with land in which the title  is bona fide in dispute.
ISSUE 1: 
Whether There Was A Claim By The Respondent By Way Of Complaint, Information Or Cross-Claim?   
14.	On this issue the Appellant is basically challenging the presiding Magistrate’s findings that the Respondent was also a landowner of Perombata and his Worship’s subsequent order for Higaturu Oil Palm to pay the Respondent moneys due to him under the lease of the Perombata land.

15.	The Appellant submits that proceedings in the District Court must be commenced by a complaint or information pursuant to Section 28 of the District Courts Act. He submits that no such complaint, information or cross-claim was filed by the Respondent to entitle him to the judgment of the District Court.

16.	The Appellant argues that the Respondent filed one document only at the trial of the matter, which was, an affidavit filed on 11 December 2012. (See Appeal Book Page 35) This, the Appellant says does not constitute of the Respondent’s cross-claim, but rather is evidence.

17.	The Appellant therefore submitted that the learned Magistrate erred in proceeding to make orders for payment of monies to the Respondent when no proper cross-claim was properly pleaded before His Worship.

18.	Mr. Mamu, for the Respondent, on the other hand, conceded that the learned Magistrate over-stepped his powers when he ordered Higaturu Oil Palm to pay the Respondent monies which His Worship said were owed to him after His Worship dismissed the Appellant’s claim for K13000.

19.	However, in regard to the Appellant’s substantive claim, Mr. Mamu submitted that the presiding Magistrate was obligated, at the very outset, to satisfy himself that the Defendant (Respondent) was in fact “a stranger to the land which is described as Perombata...” Counsel submitted that there was no need for a cross-claim in this aspect of the claim before the court. All that was needed was evidence from both parties to assist the court to decide whether there should be a refund. Counsel submitted that there was evidence that the Respondent was not a stranger to the land and that both the Appellant’s Haintapa clan and the Respondent’s Javanupa clan claimed customary ownership to land within the 105.75 hectares of Perombata.

20.	 Counsel further submitted that there was evidence before the court that the Respondent and his five member clan had not benefitted from royalties over a period of 12 years. And despite the fact that he (Respondent) was not included in the original Schedule of Owners, his name was included in a subsequent Schedule among the 17 persons named therein. Mr. Mamu submitted that the court preferred the Respondents evidence and hence dismissed the Appellant’s claim. 

21.	So was the Respondent required to file a cross-claim or a complaint or information to mount a defence to the Appellant’s claim against him, as submitted by the Appellant?

22.	There is no dispute that proceedings in the District Court must be commenced by a complaint or information as stipulated by Section 28 of the District Court Act. However, it is misconceived to say that a defendant in a suit in the District Court must commence his defence by way of a complaint or information, as seem to be argued by the Appellant. 

23.	The procedures in the District Court are meant to be simple and not cumbersome. Except for special defences such as Sett-off, Illegality, Infancy, Covertures, or a Statute of Limitation, insolvency, or Tender and Payment into Court, which require leave of the court and must be specifically pleaded (s 153 of the District Courts Act, ss 24, 25, 26, 27,28 29 of the District Court Regulation) all that is required of the defendant is for him to plead a defence and then lead evidence to support his defence.

24.	Section 140 of the District Court Act provides that at the close of the complainant’s case a defendant may give a concise statement of his defence and points on which he relies, and except by leave of the Magistrate, is not at liberty to enter on or to give evidence as to any matter not included in the defence and points so stated.

25.	 Section 145 further provides that where a defendant is required to give, and gives, a statement of his defence and the points on which he relies, the court shall reduce such statement and points into writing and preserve them.

26.	However, where the defendant makes a cross-claim, which is basically a separate claim against the original complainant, then, he must plead his claim as one would in any claim or suit. The District Court Act does not seem to provide for a procedure of making a cross-claim, but the District Court Regulation does provide that where there is no provision or insufficient provision the court may supply the deficiency by having regard to the any relevant or analogous practice, procedure or form in use by or for the purpose of, the National Court.

27.	 Be that as it may, a cross-claimant must plead a reasonable cause of action and the basic facts upon which the action is grounded. As David J put it in Amatus v Oneill [2012] N4718 in respect of proceedings commenced by writ of summons –
“...the general rule about pleadings in proceedings commenced by writ of summons is that a statement of claim should contain only a statement in summary form of the relevant and material facts on which he or she relies, but not the evidence by which those facts are to be proved: Order 8 Rule 8 of the National Court Rules
28.	This is equally true of complaints or cross-claims commenced before a District Court.

29.	Coming back to the case at hand, there is nothing from the Appeal Book which shows that the Respondent made a cross-claim against the Appellant. If anything, he merely claimed that, he too, was a landowner, named in a Second Schedule of Landowners, and was entitled to benefits from the lease of Perombata.  Incidentally, even though, he makes reference to attaching the Schedule to his affidavit, no such attachment can be seen in the Appeal Book

30.	 For the foregoing reasons, I find that the first ground of the appeal is misconceived and therefore should be dismissed.

31.	The second ground is similarly misconceived because it is premised in pursuance of the first ground and the first ground having failed this ground should also fail and should also be dismissed.  

32.	Now, let me turn to the final ground of Appeal and issue.

ISSUE 3:	
Whether or not the District exceeded its jurisdiction under Section 21(4)(f) of the District Courts Act 1963, which bars the District Court to deal with land in which the title is bona fide in dispute?
33.	The Appellant submitted that there was a bona fide dispute over the customary of the subject land on the basis that the Respondent claimed that he is also a registered owner of the land.

34.	There is no dispute that the registered lessee of the Perombata, Portion 1978C, Milinch Sangara, Fourmil Buna, Northern Province is the Haingata ILG, which holds a 99 year Special Agriculture and Business Lease to the land from the State pursuant to Section 102 of the Land Act 1996.  The land was initially leased to the State by the customary owners under Section 11 of the Land Act and subsequently leased back to Haingata ILG of which the Appellant is a member and possibly an executive member of the ILG’s Management Committee. 

35.	From the evidence in the Appeal Book, both from the Appellant and the Respondent, there appears to be no dispute to Haingata ILG’s title to land. As I have noted above, the Respondent merely claimed that he was entitled to benefits because part of his customary land is included in the lease, a fact acknowledged by the Appellants when he said in his affidavit that the Respondent’s land comprising 1.75 hectares was not developed as it formed the buffer zone. 

36.	It is clear then that the dispute was not over Haingapa’s title to the land, but rather over benefits derived from the land. 

37.	At this juncture, it is important to note that a lease of customary land by the State impacts significantly on the rights of the customary owners. Section 11 of the Land Act 1996 provides: 

11.	ACQUISITION OF CUSTOMARY LAND FOR THE GRANT OF SPECIAL AGRICULTURAL AND BUSINESS LEASE.
(1) The Minister may lease customary land for the purpose of granting a special agricultural and business lease of the land.
(2) Where the Minister leases customary land under Subsection (1), an instrument of lease in the approved form, executed by or on behalf of the customary landowners, is conclusive evidence that the State has a good title to the lease and that all customary rights in the land, except those which are specifically reserved in the lease, are suspended for the period of the lease to the State.
(3) No rent or other compensation is payable by the State for a lease of customary land under Subsection (1).

38.	It is clear then that once customary land is leased to the State all customary rights to the land are suspended for the duration of the lease.

39.	Perombata land was initially leased by the State for a period of twenty years and the owners are listed the Schedule of Owners (See page 21, 22 of Appeal Book). It is to be noted that when leasing their land to the State, the customary owners, the Haintapa People, agreed that the State issues a Special Agricultural and Business Lease (SABL) under Section 102 of the Land Act to Haintapa Land Group Incorporated No. 8402. And that was exactly what happened.

40.	The State subsequently granted a Special Agriculture and Business Lease to the Haingata ILG for a period of 99 years under Section102 of the Land Act. Section 102 provides:

102.	GRANT OF SPECIAL AGRICULTURAL AND BUSINESS LEASES.
(1) The Minister may grant a lease for special agricultural and business purposes of land acquired under Section 11.
(2) A special agricultural and business lease shall be granted–
(a) to a person or persons; or
(b) to a land group, business group or other incorporated body,
to whom the customary landowners have agreed that such a lease should be granted.
(3) A statement in the instrument of lease in the approved form referred to in Section 11(2) concerning the person, land group, business group or other incorporated body to whom a special agricultural and business lease over the land shall be granted, is conclusive evidence of the identity of the person (whether natural or corporate) to whom the customary landowners agreed that the special agricultural and business lease should be granted.
(4) A special agricultural and business lease may be granted for such period, not exceeding 99 years, as to the Minister seems proper.
(5) Rent is not payable for a special agricultural and business lease.
(6) Sections 49, 68 to 76 inclusive, 82, 83, 84 and 122 do not apply to or in relation to a grant of a special agricultural and business lease.
(7) Notwithstanding anything in this Act, a special agricultural and business lease shall be effective from the date on which it is executed by the Minister and shall be deemed to commence on the date on which the land subject to the lease was leased by the customary landowners to the State under Section 11.
41.	Subsection (3) is worthy of note. The statement referred to here, refers to the Schedule of Owners to the lease under Section 11 (2). 

42.	The Respondent referred to two Schedules in his affidavit at the trial. It is possible that the presiding Magistrate had the benefit of perusing those Schedules. Unfortunately I do not have that benefit because no such schedules are attached to the copy of his affidavit in the Appeal Book.

43.	At this point it must be stated quite categorically that Haintapa ILG’s title to the land is subject to the same protection afforded all State Leases under Section 33 of the Land Registration Act Ch. 191. In other words its title once registered is indefeasible and can only be set aside or disturbed by proved fraud or illegality.  That protection is further strengthened by the clear words of Section 11(2) of the Land Act which basically suspends all customary rights to the subject land for the duration of the lease. By operation of the law, no customary owner or claimant can therefore legitimately claim any right to the land in question.

44.	I conclude therefore that there is no bona fide dispute over the title to that land described as Perombata, Potion 1978C, Milinch Sangara, Fourmil Buna, Northern Province. And it follows therefore that the District Court did not exceed it jurisdiction in so far as its powers under Section 21(4)(f) are concerned. 

45.	However, did His worship still err when he found that the Respondent were also owners of the land in question and  in holding that he was entitled to the sums claimed by the Appellant?

46.	It is important to note here that the use of the words “owners” or “owner” must be loosely understood, because in so far as the legal position and status of the land is concerned, the legal owner is Haintapa ILG.

47.	Whether the Respondent had a part of his customary land included in the Perombata Lease to the State and its subsequent grant of a SABL to Haintapa ILG was a matter of evidence for the presiding Magistrate to assess from the evidence, including maps, which were produced before him. 

48.	Furthermore His Worship would have had the benefit of perusing the Schedules of Owners, as I earlier said. And I think that the learned presiding Magistrate was better placed to reach a conclusion in these matters - which he did - even though he did err - for want of a better word, I guess - in holding that the Respondent also “owned” the land which strictly speaking was vested in the Haintapa ILG for the duration of the lease.

49.	The Respondent's land may have been subsumed into the Perombata Lease. If that is the case, then, it would appear to me that he was entitled to benefits derived there-from, commensurate with the volume of his land, and he seemed to have provided evidence before the District Court that he was named in a Second Schedule of Owners to support his claim to benefits. And furthermore, the Appellant does admit that he has 1.75 hectares of undeveloped land within the Perombata Mini Estate. I am not assisted in this regard by the very brief findings of His Worship, but it does appear to me that he reached his decision after satisfying himself that the Respondent was entitled to benefits based on the evidence before him.

50.	 So, on this point, I am not satisfied that His Worship erred in dismissing the Appellants claim for the refund of K13000 advanced to the Respondent.

51.	However, as I have already found, His Worship erred when he ordered Higaturu Oil Palm to pay the Respondent and his Javonepa Clan what he said was due to them from moneys held in Trust to pay landowners of the Perombata Mini Estate after he dismissed the Appellant’s claim. 

52.	The Respondent did not file a cross-claim against the Appellant. And regardless of what he said in his supporting affidavit to that effect, he was not entitled to any judgment apart from the dismissal of the Appellant’s claim against him. In this regard Mr. Geroro, for the appellant, is correct in saying that the Respondent would have had to plead his cause of action separately, which of course he did not do. 

53.	His Worship clearly over-stepped his mark and went beyond the matter that was before him. In much the same way that the a complainant is precluded by Section 137 of the District Courts Act from giving evidence on a matter or cause of action that did not form part of his complaint, a defendant is similarly bound by Section 140 from departing from his statement of defence or points on which he relied where he files a defence. That being the case a magistrate has no power to extend his hearing beyond what is stated in the suit or defence that is before him. He must confine himself to the matters pleaded in the complaint by a complainant, and in the case where a defendant raises a defence, to that defence. 

54.	In the case at hand the learned Magistrate erred in making orders which did not form any part of the Respondent’s defence. This resulted in a substantial miscarriage of justice and the order in question should therefore be quashed, irrespective of the fact that he may have alluded to those claims in his affidavit.

55.	In the final analysis, the appeal should be allowed only in part. The appeal against the dismissal of the Appellant’s claim for the repayment of K13000 by the Respondent is dismissed. However, the appeal against the order for the payment of monies by HOPPL to the Respondent and his Javonepa Clan is allowed, and that order is quashed. 

ORDERS

56.	 I therefore make the following orders –

1.	The Appeal against the order of the District Court 	dated, 26th February 2013 dismissing the Appellant’s 	claim for K13000 against the Respondent is dismissed 	and the said order is affirmed.
 
2.	The Appeal against the order  of the District Court 	dated, 26th  February 2013 ordering HOPLL to pay to 	the Respondent whatever monies owed to him and the Javunapa clan members from monies held in Trust to pay landowners of Perombata Mini Estate, is allowed 	and the said order is quashed.

3.	The parties are to meet their own costs.
Ordered accordingly.
______________________________________________________________ 
Western Pacific Lawyers	: Lawyer for the Appellant		
The Public Solicitor 	: Lawyers for the Respondent