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Melanesia Trustee Services Ltd v Tongayu [2021] PGNC 81; N8815 (13 May 2021)

N8815

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]
CIA NO. 90 OF 2018

BETWEEN:
MELANESIA TRUSTEE SERVICES LIMITED
Appellant

AND:
ALEX TONGAYU as Chairman of Securities Commission of Papua New Guinea
First Respondent

AND:
SECURITIES COMMISSION OF PAPUA NEW GUINEA
Second Respondent

AND:
OXLEY EQUITIES LIMITED
Third Respondent

Waigani: Miviri J
2021: 22^nd April, 13^th May

PRACTICE & PROCEDURE – Judicial Review & Appeals – Appeal – Section 114 Securities Commission Act 2015 – Determination by Commission – Dissatisfaction – Question of Law – Respondents Notice of Motion – Incompetent – Prosecution 1 month Order 4 Rule 49 (17) NCR breach – First Respondent no authority – Criminal conviction of fraud – Instrument appointing fraudulent – Totality Motion dismissed – cost follow event.

Cases Cited

In re Application by Sakaire Ambo [2012] PGSC 29; SC1195

Ronald Nicholas v Commonwealth New Guinea Timbers Pty Ltd [1986] PNGLR 133

Ahmadiyya Muslim Mission v Bank of South Pacific Ltd [2005] PGNC 112; N2845

Seravo v Bahafo [2001] PGNC 122; N2078

Takori v Yagari [2008] PGSC 3; SC905

Juali v The State [2001] PGSC 17; SC667

CR (FC) No. 293 of 2019 The State v Alex Tongayu (07 April 2021)

OS (COMM) No. 167 of 2020 Oil Search Limited v Alex Tongayu & Christopher Hnanguie & Securities Commission of Papua New Guinea & PNGX Markets Limited (29 March 2021).
Counsel:

M. Goodwin, for Appellant

N Kopunye, for First & Second Respondents

RULING

13^th May, 2021

1. MIVIRI, J: This is the ruling on the First and Second Respondents Notice of Motion filed 08^th March 2021 pursuant to Order 18 Rule 12 (2) (4) (a) (i) of the National Court Rules for the dismissal of the appeal for want of prosecution. And also, for failing to comply with directions and orders of the Court. Further that the appellant pays the respondents costs on a solicitor/ client basis. Any other orders as deemed appropriate.
   
2. Order 18 Rule 12 (4) (a) is headed Summary disposal and reads, “The Court may summarily determine an appeal: (i) on application by a party; or (ii) on Court’s own initiative; or (iii) upon referral by the Registrar in accordance with the procedures set out in (2) below.” It is necessary to address the competency of the notice of motion of the first and second Respondents before addressing whether it applies or not given. That is whether order 18 rule 12 (4) is applicable from that source.
   
3. At the outset, the First and Second Respondents notice of motion would be more than a year old because it was initially filed on the 25^th February 2020. From today’s date 22^nd April 2021, that would be a year ago. And by Order 4 Rule 49 (17) of the National Court Rules it maybe struck out because it has not been moved within a month. That rule is in the following terms, “The Court may of its motion or upon application strike out or dismiss a motion which is not prosecuted within one month after it is filed or if it is adjourned twice.” Given this the Court can dismiss of its own motion or discretion this motion as being incompetent. In my view the fault in the way that the proceedings have come about will not be that of the appellant alone. Because it is clear by the read here that the first and second respondents also bear responsibility. They are not asking with clean hands. They are also equally responsible for the delay in the proceedings. What is also evident is that the amended notice of motion of the 08^th March 2021 is without any basis in the rules. The way it can come is by seeking leave to withdraw and to filing anew. The service of the amended motion at 2.00pm 08^th March 2021 does not cure this fact.
   
4. The Affidavit relied of Nelson Kopunye, Lawyer for the first and second respondents sworn dated 08^th March 2021 does not cure this defect. Because the explanation by that evidence does not hold water to be consistent with the Rules of Court. It is argumentative rather than evidentiary. Given this it means the notice of motion for dismissal is incompetent and cannot be moved against the appellant. It has no foot in the rules nor has it been demonstrated that it can be moved as it is. It is therefore dismissed in its entirety with costs.
   
5. The facts of the case must also be considered here. The notice of appeal filed is dated the 12^th September 2018. A notice of motion was also filed for Stay of the decision of the Securities Commission. The first respondent filed a detailed affidavit sworn on the 18^th September 2018. A Notice of motion was filed by MRDC to join the proceedings which resulted in a court order on the 25^th October 2018 refusing that motion. A Day later on the 26^th October 2018 a court order was granted staying the decision of the Securities Commission. Then a notice of motion was filed on the 19^th November 2018 by the third respondent to lift that restraining order against the respondents. It would appear that it was withdrawn after leave was granted to the third respondent 19^th November 2018. On the 07^th December 2018 the appellant filed a notice of motion seeking to lift banking restrictions imposed by the Securities Commission. And on the 12^th December 2018 an amended notice of motion was filed by the appellant to amend the notice of appeal. On the 24^th January 2019, the Respondents application to dismiss the proceedings and set aside the Stay order was dismissed by the court. On the 06^th February 2019 the First and Second Respondents filed a notice of motion to dismiss the proceedings. The appellant filed affidavits of problems in dealings with ANZ Bank Papua New Guinea due to the action of the Respondents. And on the 13^th March 2019 a court order staying banking restrictions imposed by the securities Commission. And on the 08^th August 2019 a detailed affidavit sworn 07^th August 2019 by Lawrence Stephen was filed by the appellant. Then on the 17^th December 2019 the appellant filed the notice of motion for contempt against the First and Second Respondents. Which was responded to by a notice of motion to dismiss the proceedings for want of prosecution by the First and Second Respondents. And on the 05^th March 2020 Justice Dingake delivered a decision on the service of documents in the contempt proceedings in response to request for bench warrant for the arrest of the First Respondent. On the 20^th November 2020 appellant through its lawyer filed in response to the Notice of motion explaining procedures and the steps taken. A decision was delivered by this Court on the Contempt Charges on the 10^th February 2020. On the 26^th February 2021 index to the appeal book was served on the Lawyers for the First and Second Respondents. And on the 04^th March 2021 affidavit of Lawrence Stephens for the appellant was filed annexing First Respondents Brief to the Prime Minister.
   
6. This is the hive of activity on the file from both sides to the case. It is not evidence of inactivity on the file and the case. Viewed from the angle of the Appellant there is no inactivity on the file. And from this evidence it cannot sustain that the appellant has done nothing to prosecute the appeal. This evidence does not portray that it was stagnant and procrastinated, or there was inactivity on it. The fair view is that as much activity as was discharged on the part of the respondents, the same was responded to by the appellants and vice versa. Both affidavits of Lawrence Stephens sworn of March 2021 and Nelson Kopunye 08^th March 2020 confirm and correspond with the records of the court in the matter.
   
7. So, the argument that due diligence and despatch has not eventuated In re Application by Sakaire Ambo [2012] PGSC 29; SC1195 (31 August 2012) will not sustain given. The appellant instituted this appeal pursuant to section 56 of the Capital Markets Act 2015. It is not that the appellant has come late in filling this appeal but that it has been outstanding for two years six months due to no fault entirely of its own. And the respondents’ argument that the appellant took no active steps to prosecute the appeal but concerned itself with interlocutory applications such as the contempt application that was dismissed by this court. That argument does not hold in view of the discussion set out above.
   
8. The law is as sighted by the appellant that, (i) The power of the Court to dismiss proceedings for want of prosecution should be exercised only where the Plaintiff’s default has been intentional and contumelies’ or where there has been inordinate and inexcusable delay on his or his lawyer’s part, giving rise to a substantial risk that a fair trial will not be possible or to serious prejudice to the defendant. Where there has been a long delay in bringing the proceedings to trial, a balance must be struck as between the plaintiff and the defendant and in the end the Court must decide whether or not, in the balance, justice demands that the proceedings should be dismissed,” Ronald Nicholas v Commonwealth New Guinea Timbers Pty Ltd [1986] PNGLR 133 where the defendant applied under Order 4 Rule 36 for dismissal of the proceedings for want to prosecution.
   
9. This view is consistent with Ahmadiyya Muslim Mission v Bank of South Pacific Ltd [2005] PGNC 112; N2845 (25 May 2005) also Seravo v Bahafo [2001] PGNC 122; N2078 (21 March 2001) reinforced by Takori v Yagari [2008] PGSC 3; SC905 (29 February 2008). That there ought to be reasonable cause demonstrated by material in response because, “our judicial system should never permit a plaintiff or a defendant to be driven from the Judgement seat in a summary way, without a Court having considered his right to be heard. A party has a right to have his case heard as guaranteed by the Constitution and the laws of the land. The Rules are designed to enhance those rights and to ensure the prompt and fair disposal of matters coming before the court. That right cannot be lightly set aside.” It is therefore necessary to gauge the conduct of the parties before acceding to the application, Juali v The State [2001] PGSC 17; SC667 (30 July 2001).
   
10. It is primary and important to place and consider related cases that have been drawn to the court against the first respondent to this proceeding. The first is a criminal case of fraud against the first respondent, particularly as to the instrument appointing him to that position personally, and as to his capacity as the second respondent chair. It is also clear that the first Respondent has been found guilty of the criminal offence of Fraud pertaining to the Instrument appointing to the second respondent chair in CR (FC) No. 293 of 2019 The State v Alex Tongayu (07 April 2021) the effect of which is that he has no authority to be in the chair of the second respondent. His continued occupation in that chair is now seriously affected by that conviction. The instrument appointing has not come through process of law; he is unlawfully in the chair. He has been convicted of fraud in the instrument appointing. It means he has no authority from that date emanating from that fraudulent instrument. In my view it may also have serious repercussion on his continued employment in that office. Further and fundamental any exercise of power as chair derived from this Instrument would be void ab initio and of no effect.
    
11. And these views are consistent with a related matter of OS (COMM) No. 167 of 2020, Oil Search Limited v Alex Tongayu & Christopher Hnanguie & Securities Commission of Papua New Guinea & PNGX Markets Limited (29 March 2021). That the second defendant in that proceeding Christopher Hnanguie remained as chairs of the second respondent not the first respondent. Because the effect of the stay order there coupled with now the criminal conviction of fraud relating to the appointment to the chair of the second respondent, clearly saw him out. He simply had no authority in law emanating and the acting appointment, if made would amount in my view, conduct that is contemptuous. Particularly with the observations set out above in total. They would have very strong bearing on any other related proceedings now pending before this court against the respondents either as instigators or defendants, unless and until it is set aside by appeal. For the present they are very strong positions in the law against and material in any other proceedings now open in court including the judicial review proceedings against the first respondent.
    
12. Given all these the totality is that the motion to dismiss is incompetent. Even if it were allowed the material does not support that the appellant was primarily at fault. There is no evidence demonstrated to the required balance to accede. The motion is dismissed in its entirety with costs forthwith.
    
13. The formal orders are:
    
    • (i) Respondents Motion is incompetent and without merit.
    • (ii) Respondents Motion is dismissed in its entirety.
    • (iii) Costs will follow the event forthwith.

Orders Accordingly.

__________________________________________________________________

Goodwin Bidar Nutley Lawyers: Lawyer for the Appellant

Kopunye Lawyers: Lawyer for the Respondents