Home | Databases | WorldLII | Search | Feedback National Court of Papua New Guinea

National Capital District Commission v Internal Revenue Commission [2022] PGNC 198; N9650 (7 June 2022)

N9650

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS (COMM) NO. 11 OF 2021 (NO. 4)

BETWEEN:
NATIONAL CAPITAL DISTRICT COMMISSION
Plaintiff

V

INTERNAL REVENUE COMMISSION
First Defendant

AND:
SAM KOIM in his capacity as the COMMISSIONER GENERAL OF INTERNAL REVENUE COMMISSION and in his capacity as Trustee of National Capital District Inland GST
Second Defendant

AND:
THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Third Defendant

AND:
CENTRAL PROVINCIAL GOVERNMENT
Fourth Defendant

AND:
MOTU KOITA ASSEMBLY
Fifth Defendant

AND:
GULF PROVINCIAL GOVERMENT
Sixth Defendant

AND:
EDITH LAUFA in her capacity as Trustee of National Capital District Inland GST Trust Account
Seventh Defendant

Waigani: Anis J
2022: 3^rd & 7^th June

NOTICE OF MOTION – Application for adjournment – Order 12 Rule 1 of the National Court Rules and s 155(4) of the Constitution – seeking an adjournment based on pending matter before the Supreme Court – consideration – exercise of discretion

Cases Cited:

NCDC v. IRC and Ors (2021) N8809
Ihari v. Motor Vehicles Insurance Limited (2006) SC1317
Ok Tedi Mining Ltd v. Niugini Insurance Corporation [1988-89] PNGLR 355

Counsel:

D Wood, with counsel assisting A Edo and L Evore, for the Plaintiff
S Sinen with counsel assisting G Wau, for the First and Second Defendants
T Mileng, for the Third Defendant
G Wayne, for the Fourth Defendant
Nil appearance for the Fifth Defendant
S Dewe with counsel assisting J Kilwe, for the Sixth Defendant
Nil appearance for the Seventh Defendant

RULING

7^th June, 2022

1. ANIS J: Two (2) applications returned before me on 3 June 2022. The first was filed by the fourth defendant on 23 February 2022, which seeks to dismiss the proceeding, and the latter was filed by plaintiff on 31 May 2022, which seeks to, amongst others, adjourn the proceeding pending a matter that is pending before the Supreme Court. By consent of the parties, I heard the plaintiff’s notice of motion (NoM). It was contested, and so after the hearing, I reserved my ruling to today at 1:30pm.

2. This is my ruling.

BACKGROUND

3. I summarised the brief background of this matter in NCDC v. IRC and Ors (2021) N8809. At paras 3, 4 and 5, I said:

3. The plaintiff seeks various declaratory relief in its originating summons. The relief sought essentially relate to or concern the application or interpretation of provisions under 2 legislations, namely, the National Capital District Commission Act 2001 (NCDC Act) and the Inter-Governmental Relations (Functions and Funding) Act 2009 (IGR Act). The provisions include sections 37 to 45 of the IGR Act, and section 33(2) of the NCDC Act.

4. What triggered the plaintiff to filing this proceeding and seeking interim restraining orders is this. On 22 April of 2021, the 2^nd defendant made a formal announcement in the media. He informed the public and relevant stake holders, and I will paraphrase, that he has made a decision whereby instead of a current practice where GST funds for the 4^th, 5^th and 6^th defendants (the 3 named defendants) are paid by 1^st Defendant (the Commission) to them through the plaintiff, that the Commission will commence paying these GST portions or percentages of funds directly to the 3 named defendants. The 2^nd defendant gave effect to his decision by effecting payments of the GST funds that were required for the month of April 2021 directly to the 3 named defendants.

5. The plaintiff, having knowledge of that, filed this proceeding....

NOTICE OF MOTION

4. Relief 1, 2 and 3 in the plaintiff’s NoM are not contested, and as such, I grant them, that is, I firstly dispense with the requirement of service of the NoM. I also grant leave to the plaintiff to withdraw its notice of motion filed on 27 May 2022. I further grant leave to the plaintiff to move on its NoM and to rely on the affidavit of Augustine Ravi filed on 31 May 2022.

5. The 2 main contested relief in the NoM are relief 4 and 5. They read:

4. Pursuant to Order 12 Rule 1 of the National Court Rules and/or section 155(4) of the Constitution and/or the inherent jurisdiction of the Court, this proceeding be adjourned until the hearing and determination of the Supreme Court application, SCC(OS) No. 1 of 2022.
5. Alternatively, pursuant to Order 12 Rule 1 of the National Court Rules and/or section 155(4) of the Constitution and/or the inherent jurisdiction of the Court, the hearing of the fourth defendant’s Notice of Motion filed on 23 February 2022 and/or any other Notice of Motion for dismissal be adjourned to be heard and determined together with the substantive hearing of this proceeding and for this purpose directions be issued to progress this matter to trial forthwith.
   

6. The fifth and seventh defendants did not appear. The first, second and third defendants supported the plaintiff’s NoM. The fourth and sixth defendants opposed it.

ISSUE

7. The main issue in my view is this, whether this proceeding and any interlocutory matters such as the fourth defendant’s pending application to dismiss, can proceed in view of the pending Supreme Court matter, that is, SCC(OS) No. 1 of 2022, or whether to proceed with the present matter will be a rehearse or will mean that this Court will proceed on matters which the Supreme Court has already seized of, and as such, the best way forward would be to adjourn and await the outcome of the Supreme Court’s decision on the matter.

8. In my view, this is not a straightforward-type request for adjournment where the normal considerations for an adjournment may have to be satisfied. See cases: Ihari v. Motor Vehicles Insurance Limited (2006) SC1317 and Ok Tedi Mining Ltd v. Niugini Insurance Corporation [1988-89] PNGLR 355. But that said and even then, the Court’s power to grant an adjournment remains discretionary. In this case, the plaintiff is seeking to halt this proceeding by requesting for it to be adjourned pending a Supreme Court proceeding, namely, SCC(OS) No. 1 of 2022 that has been filed. I note that the Supreme Court proceeding is not related to this present proceeding. However, the plaintiff argues that it would have substantive bearing on this case.

9. So, let me consider the Supreme Court matter.

SCC(OS) No. 1 of 2022.

10. A sealed copy of the Supreme Court document, which is a section 18(1) proceeding that seeks the Supreme Court’s interpretation or application of a provision of Constitutional Law, is annexed at para 3 to Mr Ravi’s affidavit.

11. I note that proceeding SCC(OS) No. 1 of 2022 (or the s 18(1) proceeding or the SC proceeding) was filed by the present Governor of the National Capital District (NCD) Hon. Powes Parkop. I have considered the questions that is raised by the Governor in the SC proceeding. For this purpose, I note 2 of the intended challenges which I will summarise as follows:

1. the Governor for NCD is asking the question, that is, whether the action by the Minister for Inter-Government Relation where he had exercised his powers under the Organic Law on Provincial and Local Level Government 1995 (OLLPLLG) to proclaim NCD as a provincial government, which had been effected by Gazettal Notice G-712 of 19 October 2021, means that NCD is now a provincial government and shall be bound by the OLPLLG and not the Act of Parliament that created and governed it, namely, the National Capital District Commission Act 2001 (NCDC Act);
   
2. the other question relates to the recently passed bill that amended the NCDC Act, which has since been enacted into law, namely, National Capital District Commission (Amendment) Act 2021 (NCDC Amendment Act 2021), that is, whether by permitting 2 provincial governors (one for NCD and the other for the Central Province) to constitute or be part of the NCDC Board (i.e., amending s 5(1) of the NCDC Act) is constitutional or valid given that a Governor for the Central Province is not an elected person by the constituents of NCD.
   

CONSIDERATION

12. When I consider SC proceeding to the present matter, I make these observations. Firstly, the SC proceeding is unrelated to this matter. The parties therein are quite different including the issues for deliberation. But perhaps most importantly, I note that the questions that this Court may consider relates to existing laws which may include the NCDC Amendment Act of 2021 which is already a law that is passed by Parliament.

13. I uphold the submission by fourth defendant that this Court may proceed to consider the issues herein based on the laws as they are, and that if these laws were to be declared invalid or unconstitutional at some point in time in the future then that shall be the case when that happens, but that the National Court should not be prevented from performing its functions or be kept waiting to see if a law will eventually change, or be declared null and void, or otherwise.

14. In other words, NCDC or the plaintiff herein is presently obliged by its laws in particular, the NCDC Act of 2001, which is presently binding, to function or exist. The plaintiff is not shut out of its functions or operations because of any uncertainties or based on the said Supreme Court proceeding. It is presently operating with its day-to-day operations. The present SC proceeding, except for the stay or interim orders that were issued by Logan J to maintain the status quo and operation of the NCDC Act of 2001, has not hindered the plaintiff’s operations or put it to a complete stop to await its outcome. Likewise, in this case and my view, there is nothing stopping this Court to proceed with the matter whether it be on interlocutory matters or otherwise to progress the matter to trial.

15. I also do not see any real prejudice to be suffered by the parties if this matter continues.

SUMMARY

16. In summary, except for relief 1, 2 and 3, I decline the balance of the plaintiff’s NoM. I will proceed to deal with the fourth defendant’s notice of motion filed on 23 February 2022.

17. That said, given that (i), two of the parties were not present at the last hearing, and (ii), the substantive nature of the fourth defendant’s notice of motion where if granted, would mean the end of the matter, I am not inclined to deal with the fourth defendant’s notice of motion right away this afternoon, but rather, at some later date either at the end of the week or upon an agreed date some time next week or so. In that way, all the parties are given the opportunity to come prepared to make their arguments either for or against the fourth defendant’s notice of motion, that is, preferably with written submissions so to assist the Court.

COST

18. An award of cost herein is discretionary. I will order cost to follow the event. The plaintiff shall pay the costs of the fourth and sixth defendants in regard to the plaintiff’s NoM on a party/party basis which may be taxed if not agreed.

ORDERS OF THE COURT

19. I make the following orders:

1. I grant leave and the plaintiff’s Notice of Motion filed on 27 May 2022 is withdrawn.
   
2. I dispense with the requirement for service of the plaintiff’s Notice of Motion filed on 31 May 2022 and its supporting documentations.
   
3. I grant leave to the plaintiff to move on its Notice of Motion filed on 31 May 2022 with the supportive Affidavit of Augustine Ravi filed on 31 May 2022.
   
4. I, however, decline to grant the relief which seeks to adjourn the proceeding pending the outcome of proceeding SCC(OS) No. 1 of 2022 or the alternative relief.
   
5. The plaintiff shall pay the fourth and sixth defendants’ costs of this application on a party/party basis which may be taxed if not agreed.
   
6. I will proceed to hear the fourth defendant’s Notice of Motion filed on 23 February 2022 on a date to be fixed by the parties or by this Court.
   
7. Time for entry of these orders is abridged to the date and time of settlement by the Registrar which shall take place forthwith.
   

The Court orders accordingly.

________________________________________________________________
Ashurst: Lawyers for the Plaintiff
In-house counsel: Lawyer for the First and Second Defendants
Solicitor-General: Lawyer for the Third Defendant
Kessadale: Lawyer for the Fourth Defendant
In-house counsel: Lawyer or the Fifth Defendant
Jema: Lawyer for the Sixth Defendant
Mr Mukwesipu Lawyer for the Seventh Defendant