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National Court of Papua New Guinea |
PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]
WS. NO. 1109 OF 2015
BETWEEN:
OUTSKIRTS CONSTRUCTIONS LTD t/a SUNSET LODGE
Plaintiff
AND:
KENNETH ATASOA – Deputy City Manager, NCDC
First Defendant
AND:
SEBASTIAN ISU – Physical Planner, NCDC Physical Planning Division
Second Defendant
AND:
ISOWA MORE – Chief Health Surveyor, NCDC Regulatory Services Division
Third Defendant
AND:
NATIONAL CAPITAL DISTRICT COMMISSION
Fourth Defendant
Waigani: Manuhu, J
2020: 11th February & 27th August
TORT – Claim for loss of business –Conducting Commercial activity on Residential Lease –Closure of Premises by Local Medical Authority – Condition unfit for human occupation.
PRACTICE AND PROCEDURE – Notice for Unauthorised Use – Notice of Condemnation – Rights of an Aggrieved Party – Jurisdiction – Validity of Notices.
Case Cited
Nil
Counsel:
J. Apo, for the Plaintiff.
L. Raula, for the Defendants
27th August, 2020
1. MANUHU, J.: The Plaintiff commenced the proceeding on 25 August 2015 for loss of business after receiving a notice of refusal of renewal of restaurant licence, a notice to cease operation of business and a notice of condemnation of the premises.
2. The Plaintiff operated a lodging accommodation and restaurant at Section 43 Lot 22, corner of Le Hunt and Davara Road, Ela Beach, Port Moresby. It had been operating for 12 years as Sunset Lodge prior to the closure of the lodge. In January 2015, the Plaintiff applied for a renewal of the restaurant licence which was considered and refused in May 2015.
3. On 18 June 2015, the Plaintiff was served with a notice of condemnation on the basis that the premises were unfit for human occupation and that all persons are to vacate the premises.The notice was served by armed policemen. The Plaintiff claims that the inspection of the premises was carried out without the knowledge of the Plaintiff and there were no material defect or presence of hazardous material or substances to warrant the issuance of the notice. In any case, the notice was defective.
4. A day later on 19 June 2015, the Plaintiff was served with a notice to cease operation of business on the basis that a residential lease was illegally used for commercial purposes, namely, the operation of a brothel. The Plaintiff claims that there was no factual basis for the allegation and, in any case, the notice was defective.
5. The claim in respect of the refusal to renew the restaurant licence was abandoned. In relation to the other two notices, Anthony Temo, Managing Director of the Plaintiff (the Landlord) gave evidence that there was no factual basis for the condemnation. Inspection of the premises was carried out without his or his employees’ knowledge. The state of affairs was exaggerated and falsified. There was no structural defect but if there was, the Plaintiff was never notified to remedy the defect. The notices were coordinated and served on the eve of the SP Games in Port Moresby. There were armed police personnel involved in the service of the notices. The gate of the premises was locked and employees were threatened by the defendants and armed policemen.
6. In cross-examination, the witness did not deny that the lease was for residential purposes. When told in cross-examination that the operation of a lodge on a residential lease was illegal, the witness said that other people were operating businesses on residential leases too. When cross-examined about the poor condition of the premises, the witness stated that everyone should be treated fairly. The witness further stated that K60-70,000 was spent to renovate the premises but when asked, he was unable to produce any evidence to support his claim.
Leo Bano headed the maintenance section of the Plaintiff. He gave evidence that K60-70,000 was spent to renovate the premises but when asked, he was unable to produce any receipts or photographs of any work done.
7. Elizabeth Teka was the supervisor. She said she did not accompany the officials during the inspection of the premises because she was not aware that there would be an inspection. When shown the photographs taken during the inspection, she did not deny the photographs but she says it was not proper for the inspection to proceed without her knowledge. The last witness was Wesley Belo whose evidence relates to intimidation, harassment and physical assaults at the time of service of notices.
8. The fourth defendant’s witnesses were Kenneth Atasoa, Clivan Naha and Tom Kamtai. Tom Kamtai’s is irrelevant because the Plaintiff has abandoned his challenge against non-renewal of liquor license. Kenneth Atasoa is the Deputy City Manager, Regulatory Services, of NCDC. He said that following an inspection around the city of Port Moresby, it was noted that the Plaintiff’s premises at Section 43, Lot 22, Davara Road, was used for illegal brothel operations so a Notice for Unauthorised Use was issued to stop the illegal activity.
9. The notice for unauthorised use was issued under sections 74 and 98 of the Physical Planning Act 1989.
Section 74 provides:
“74. Use and development of land and buildings in a zone for unauthorized purposes.
(1) Subject to this section, a person who carries out development, or uses a building or land, in a zone for a purpose that is not an authorized purpose in relation to the building or land is guilty of an offence.
(2) Where—
(a) a building or land was, at any time, for a period of not less than 60 days within the period of six months before the date of a Board's decision to publish the relevant notice of zoning under Section 71, used for a purpose that is not an authorized purpose in relation to the building or land; or
(b) a building in a zone was, at the date of a Board's decision to publish the relevant notice of zoning under Section 71, under construction and intended to be used for a purpose that is not an authorized purpose in relation to the building,
the building or land may, subject to Subsection (3), continue to be so used, or may be so used, as the case may be, after the date of publication of the relevant notice in the National Gazette.
(3) Subsection (2) ceases to apply to and in relation to a building or l and—
(a) on the discontinuance for a period of six months of its use for the purpose referred to in that subsection; or
(b) in the case of a building—on its destruction.”
10. Section 98 provides:
“98. Unauthorized Development.
(1) A person who, otherwise than as authorized by or under this Act—
(a) uses or permits any land or building to be used; or
(b) allows development to be carried out,
is guilty of an offence.
Penalty: A fine not exceeding K4,000.00.
Default penalty: A fine not exceeding K400.00.”
11. The notice in question included a fine of K4,000 and a default penalty of K400 for each failure to comply.
12. Given the nature of the decisions, especially the fine, it is expected that the governing legislation would have provisions for aggrieved persons to appeal but there may be a good reason for having no provisions for appeals. I can imagine the undesirability of dragging zoning issues into a long drawn out legal battle in court.
13. Nonetheless, the only provision on appeal is section 94 of the Act:
“(1) An applicant, or an owner or an occupier of land who is aggrieved by a decision of a Board, may appeal to the Tribunal within the prescribed time from the date of the decision or, in the case of a zoning, the date of the gazettal of the decision, whichever is the later.”
14. It doesn’t appear to be a clear conferral of a right of appeal but it is clear from the provision that there are administrative avenues available for the Plaintiff to explore. There is no evidence that he has attempted to explore and exhaust possible administrative options to be heard on his grievances. The other option available to the Plaintiff is to seek a judicial review of the decisions in the National Court so that the validity of the notice can be determined. He has not taken these courses of action. In addition, the Plaintiff has not demonstrated that this Court has the jurisdiction to declare the administrative decisions in question null and void (which is a judicial review power) in the process of determining a claim for damages for loss of business.
15. I am of the considered opinion therefore that the Notice of Unauthorised Use is still current and effective, and as such, the Plaintiff is not entitled to claim damages for loss of business as pleaded. The whole proceeding should fail for this reason alone.
16. For completeness sake, I will consider the Notice of Condemnation.
17. The Notice of Condemnation was issued under section 12 and 13 of the Public Health (Sanitation and General) Regulation, Ch. No. 226.
18. Section 12 provides:
“Where, in the opinion of the Local Medical Authority, a dwelling is so overcrowded as to be dangerous to the health of the inmates, the occupier of the dwelling shall, within such time as is specified in the written order issued by the Local Health Authority and served on him, abate the overcrowding to the extent specified in the order.”
19. Section 13 reads:
“(1) Where, in the opinion of the Local Medical Authority, a building used as a dwelling is in such a condition as to be dangerous to the health of the inmates, the Local Medical Authority may, by written order served on the inmates and the owner, require –
(a) The inmates to leave the building; and
(b) The owner to cease using the building as a dwelling or allowing it to be so used.
(2)A person who refuses or neglects to comply, within the time specified in the order, with an order under subsection (1) is guilty of an offence.
Penalty: A fine not exceeding K100 or imprisonment for a term not exceeding three months, and in addition, in the case of a continuing offence, a fine not exceeding K10 for every day during which the offence continues.”
20. The Court is not aware of any provision for an aggrieved party to challenge the decision to condemn premises. There is no appeal provision under the Act, maybe for good reasons. I note, however, that the penalties for offences under the Act are mainly fines of around K100.00 and default penalties of K10.00. Under section 9(3) of the Regulation, where an occupier fails to comply with an order to clean the premises, the Local Medical Authority may recover cost of any operation in the District Court.
21. In the same manner, I am of the view that a person who is aggrieved by the decision of the Local Medical Authority to condemn his premises should appeal, seek a review or challenge the decision in the District Court. With the Notice of Condemnation still current and effective, the entire proceeding must fail.
22. As I mentioned above, the other option available to the Plaintiff was to seek a judicial review of the decisions in the National Court. The Plaintiff has not done so. In addition, the Plaintiff has not demonstrated that this Court has the jurisdiction to declare the administrative decision in question null and void (which is a judicial review jurisdiction) in the process of determining a claim for damages for loss of business.
23. In any case, the issuance of the notice was based on the following findings:
24. The man behind the notice was Clivan Naha. He was the Environmental Health Officer employed by NCDC. He presented into evidence a letter dated 18th June 2015 to the landlord, which referred to an inspection that was carried out on 15th June 2015 at 11:00 am. The above defects were listed in the letter, and:
“Therefore, this notice serves to advise the management that the above accommodation is now declared unfit for human habitation by this Local Medical Authority as per Section 12 and 13 of the Public Health (Sanitation and General) Regulation Chapter No 226 of the Independent State of Papua New Guinea.
“All persons living within the premises are instructed to vacate the premises upon date of receipt of this notice until such time all building defects are addressed to the satisfaction of this Authority.
“Failure to comply will result in legal action taken against you without further warmings.”
25. Photographs of the above defects were taken and tendered into evidence.
26. I have considered the evidence, the photographs, the notices and the relevant provisions of the relevant legislation. In my view, the landlord and the witnesses were evasive when confronted with the inspection report and the photographs. The landlord kept on repeating that other people are guilty of operating businesses in residential areas, that the inspection was done without his knowledge and that police were engaged and intimidated the employees. All of these claims, if true, do not change the fact that there is overwhelming credible evidence, and the Court so finds, that the premises were unfit for human occupation and unfit to operate a guest house.
27. The landlord and his witnesses are all lay people. None of them has the qualification to advise on public health and sanitation standards. The Plaintiff has not called any expert witness or any health professional who has the qualification to contradict or counter the evidence of experienced professionals who gave evidence for the defence.
28. It is in the public interest for residents, occupiers and operators of premises within the city to abide by the laws and regulations to which the NCDC is the administering authority. It is hard to comprehend that while the inspection was in progress, the landlord was absent and the guest house supervisor was absent. Such attitude is unacceptable. Public bodies charged with the responsibility to oversee public health and sanitation standards in Port Moresby require our cooperation, must be respected and allowed to carry out their statutory duties. We should not impose our preferences and our standards on these professionals and, ultimately, the city.
29. And although the premises in question was condemned, the landlord did not lose his ownership rights over the property. As noted in the condemnation notice, he was not prevented from renovating the property and have it upgraded to an acceptable standard. He cannot be allowed to do nothing and then run to the courts to claim loss of business. That is not fair, it is not equitable. He has not come to court with clean hands.
30. For all the foregoing reasons, the claim is without merit and, for that reason, the proceeding is dismissed with costs which, if not agreed, shall be taxed.
Orders accordingly.
________________________________________________________________
Apo & Co. Lawyers: Lawyer for the Plaintiff
In-house Lawyers: Lawyer for the Defendants
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URL: http://www.paclii.org/pg/cases/PGNC/2020/229.html