N11019

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

WS NO 197 OF 2020 (CC1)

BETWEEN:
JOHN NUKA, for himself and on behalf of the Kunalgapem Clan of Kumai Tribe of Kup, Kerowagi District, Simbu Province
Plaintiff/First Respondent

AND:
PETER KAMA, ANNA KAMA, and MICHA KAMA as Joint Tenants over SABL Portion 1239C Volume 15, Folio 43
First Defendants/Applicants

AND:
COVEC (PNG) LIMITED
Second Defendant/Second Respondent

AND:
ALA ANE
REGISTRAR OF TITLES
Third Defendant

AND:
BENJAMIN SAMSON
Secretary, Department of Lands & Physical Planning
Fourth Defendant

AND:
HON. JOHN ROSSO
Minister for Lands & Physical Planning
Fifth Defendant

AND:
THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Sixth Defendant

Waigani:   Bre, AJ
2024: 16th May & 26th September
CIVIL PRACTICE AND PROCEDURE - Application for summary dismissal on grounds of competency - time limitation –  whether cause of action based on equitable or actual fraud – conflicting Supreme Court decisions- no submissions from counsels- open to Court to decide – 12 years late – no prompt challenge to land title – no good reasons -  interest of justice considered – jurisdictional basis section 155(4) of the Constitution and Order 12 rule 1 NCR applies - proceeding summarily dismissed.

Cases Cited

Boko v National Agricultural Research Institute (NARI) [2024] N10767
Camilus v Mota [2022] SC2210
Covec (PNG) Ltd v Kama [2020] SC1912
Douglas Dent v. Thomas Kavali & Ors [1981] PNGLR 488
Geru Holdings Limited v Kruse & Ors [2023] SC2492
Kewa v Kombo [2016] SC1542
Kimas v Oala [2015] SC1475
Kove v Po'o [2022] SC2231
Hiwi v Rimua [2015] SC1460
H.R. Holdings Ltd v Taka [2023] SC2411
Lord & Company Ltd v Inapero [2014] SC1624
Mamun Investment Limited v. Nixon Koi (2015) SC1409
Oil Search Limited v Mineral Resources Development Corporation Ltd [2010] SC1022
Paiko v Mondoro [2022] N9934
Powi v Southern Highlands Provincial Government [2006] SC844
Saba v Kaienge [2023] N10243
Timothy v Timothy [2022] SC2282

Legislation

Claims By and Against the State Act 1999, s5
Fraud and Limitations Act 1998, ss16 and 18
Land Registration Act chapter 191, ss33 and 160

Counsel

Mr C Dagma, for the Applicant/First Defendant
Ms J Tindiwi, for the First Respondent/Plaintiff
Mr W Mapiso, for the Second Respondent/Second Defendant 

RULING

26th September 2024

1.BRE, AJ: The first defendants apply to summarily dismiss the entire proceedings on competency grounds.
The background to the application concerns land located in the Kerowaghi district of Simbu Province known locally as 'Las Dombil' or formally as Portion 1239C Volume 15, Folio 43 issued as a Special Agriculture and Business Lease (SABL) to the first defendants on 11 March 2008. The plaintiffs allege that they are customary landowners and the SABL is issued irregularly amounting to fraud and filed this proceeding to challenge the first defendants' title. 
The economic interest arising from the land is the extraction of gravel, which at the relevant time was extracted by the second defendant to rehabilitate the Simbu section of the Okuk Highway.

2.	The first defendants rely on the following grounds to move their application: -

1) Section 5 notice to the State was served outside the time limits contrary to the Claims By and Against the State Act 1999 (CBASA),
2) The proceeding  is time bar pursuant to section 16 of the Fraud and 	Limitations Act 1988 (FLA), 
3) The cause of action disputes customary ownership, which this Court has no jurisdiction to decide,
4) The proceeding should be summarily dismissed for being frivolous, 	vexatious or an abuse of process for the above reasons, or alternatively; 
5) The proceeding has not been expeditiously prosecuted.

 3.	The application is supported with the following evidence: -

1) Affidavit of Peter Kama filed on 02 July 2020,
2) Affidavit of Camillus M Gagma filed 24 November 2022, and
3) Affidavit of Arnold Daugl filed 24 April 2023.

4.	The Respondents rely on the following evidence:-

1) Affidavit of Jubilee Tindiwi filed 12 December 2023,
2) Affidavit of Land Title Search filed 30 November 2022, 
3) Affidavits of Zhao Xiaoping filed 29 November 2023, and
4) Affidavits of John Nuka filed 15 May 2024.

5.	The application concerns time limitation which goes to the competency of the entire proceedings. Time limitation is a cross-cutting issue affecting the other reliefs sought by the first defendants and depends on whether the claim is based on constructive or equitable fraud and if so whether section 18 of the Fraud and Limitation Act 1998 (FLA) applies to render time limitation in section 16 FLA, immaterial.
6.	Time bar applications usually arise from a clear set of facts that the proceeding is commenced outside the six-year time limit. See Oil Search Limited v Mineral Resources Development Corporation Ltd [2010] SC1022.
Section 16 of the Fraud and Limitation Act 1998 (FLA) provides that actions "founded on simple contract or on tort" are statute bar when commenced after six years from the date the cause of action arose.
7.	Here, counsels provide three potential dates when the course of action arose. These are: -
1) December 2003: when the Land Court decided customary 			    ownership,
2)  11 March 2008: the registration date of the SABL, or
3) February 2020: when the Supreme Court handed down its decision in 	SCA no 16 of 2017 between the first and second defendants.

8.	The respondents provide a fourth reason, which is the main argument, that section 18 FLA overrides section 16 FLA because the cause of action is based on constructive fraud. In Mamun Investment Limited v. Nixon Koi [2015] SC1409, the Supreme Court held that the period to compute time in cases of fraud concerning State leases is from the date of registration.  The SABL was registered on 11 March 2008. This proceeding was commenced on 11 March 2020. A total of 12 years has passed since the granting of the SABL. 
9.	The other date of February 2020 implies a case of concealed fraud. However, there were no submissions on this point by the respondents. Even if concealed fraud applies, the decision in Mamun Investment Limited v. Nixon Koi prevents computation of time from when the concealed fraud was discovered as the Court reasoned that concealed fraud is not captured in our FLA.  
10.	The plaintiffs provide evidence to demonstrate that they have a claim in constructive fraud which raises serious issues of impropriety and compliance gaps in the SABL title acquisition process that section 18 FLA applies to sustain the action despite the 12-year time period.
11.	The plaintiffs, supported by the second defendants, emphasise that there are circumstantial evidence pointing to fraud allegedly committed by the second defendants/applicants as contained in the affidavits of Tindiwi and Nuka and urged this Court to refuse the application. 

On this, the respondents produced evidence of an administrative summons by the Registrar of titles issued on 9 December 2022 to the applicants demanding the production of the title within 14 days because of alleged irregularities that had been brought to his attention.

The first defendants countered by adducing evidence of correspondence to the Lands Secretary on 19 December 2022, challenging the basis of the Registrar's summons. 

To me, the summons is a separate process under the Land Registration Act (LRA) available to the Registrar to pursue under section 160 LRA and is not a material consideration in deciding this application.

12.	In considering the submissions, I take into account the ultimate impact of a favourable decision for the plaintiffs in the substantive proceedings will involve a twofold result which may be a reversal of the judgement debt of over K4milliom against the second defendant in SCA no 16 of 2017 or Covec (PNG) Ltd v Kama [2020] SC1912 and engagement of the formal customary land ownership process, a second time. 
13.	Additionally, counsels for the plaintiffs and second defendant have not made proper submissions on the terms of section 18 FLA as it applies to an equitable claim and the reliefs it seeks of declarations and an injunction. The Supreme Court has held that declarations derive their source from the Court's inherent jurisdiction from statute in section 155 (4) of the Constitution. See Douglas Dent v Thomas Kavali & Ors [1981] PNGLR 488 and Mamun Investment Limited v. Nixon Koi [2015] SC1409.  

14.	The respondents must demonstrate the claim is based in equity such as in Kewa v Kombo [2016]SC1542 where landowners challenging the title were held to have a claim in equitable ownership of lands which were improperly registered to the person who was to obtain title for the landowners as a collective. The pleadings do not plead equitable ownership of the lands. 

In addition, I find that the customary ownership claim goes to demonstrate standing rather than to challenge customary ownership. This Court is devoid of jurisdiction to hear customary land ownership disputes. See Kimas v Oala [2015] SC1475.

Besides, the submissions of the respondents are that the plaintiffs are challenging the State lease. This challenge can stand.  See Charlie v Paki [2021] SC2134.  
Still, the respondents' submissions fell short of addressing whether the claim was seeking ‘equitable relief’ within the meaning of section 18 FLA.
15.	The respondents referred me to the Supreme Court case of Camilus v Mota [2022] SC2210 which held that constructive fraud is equitable fraud and section 18 FLA applied to sustain the action. In Camillus v Mota, the claim was filed 6 years after the State Lease, an SABL was issued. Here, the claim is filed 12 years after the SABL was issued to the first defendants.
16.	However, the Supreme Court in Timothy v Timothy [2022] SC2282 overruled the decision in Mota on equitable fraud and agreed with Mumun Investments. Though, the Supreme Court composition was the same in the two cases. Thus, the issue of whether section 18 FLA applies to constructive fraud cases to render inapplicable the time limit of six years in section 16 FLA, remains outstanding and is yet to be deliberated on by a five-member Supreme Court. See Saba v Kaienge [2023] N10243 and See Boko v National Agricultural Research Institute (NARI) [2024] N10767.
17.	This does not mean I am at an impasse and cannot decide on the application. The Supreme Court in H.R. Holdings Ltd v Taka [2023] SC2411 at [46] considered the conflicting decisions and held that it is open to the Court to decide, where Counsels have not brought to the attention of the Court the issue of the conflicting decisions. Counsels in this case, did not bring these conflicting decisions to my attention. I discovered the caselaw from my own research. It is clearly open to me to decide the application.

18.	In deciding, I turn to other considerations and particularly those of the time factor and the plaintiffs' actions in challenging the SABL. 
I find the evidence of John Nuka (Doc 25) on the reasons why he did not challenge the first defendants National Court proceedings against the second defendants in 2007 because of financial and security reasons, unsatisfactory. There is no corroborative evidence of a tribal fight in 2007, and John Nuka is representing a class of people from the Kunalgapem clan of Kumai Tribe of Kerowagi where other members of the class would have pursued the claim. 
19.	Further, John Nuka does not provide any explanation about whether he was aware of the land mediation in 2003. If the clans are neighboring clans as stated in both Nuka and Kama’s evidence, it is reasonable to assume someone or more from amongst the clans would have known about the land mediation.  
20.	I find that there are no good reasons to justify why this proceeding commenced 12 years late nor any reasons why the plaintiffs did not take adequate actions to protect their interests in the land over the course of these 12 years.  I consider it is not in the interest of justice to sustain this proceeding 12 years after the date on which the cause of action arose, which I find to be the date of registration of the SABL, 11 March 2008 and not December 2003 nor February 2020 as submitted.
21.	The plaintiffs had a lot of time from 2003 to 2007 or 2008 to challenge the customary land dispute process or the State lease but did not. This is a claim in constructive or equitable fraud, a maxim of equity requires that (s)he who seeks equity must come with clean hands. Equity will not support laches or delay. See Kove v Po'o [2022] SC2231. 
22.	Further and importantly, it is an abuse of process to allow the National Court proceedings in WS 712 of 2007 to proceed to 2017 then to 2020 without the plaintiffs promptly intervening to challenge the SABL. Both the National and Supreme Courts have recognised ownership of the SABL to the first defendants which commenced those proceedings in WS 712 of 2007 on behalf of the Damin Kamin clan of Kumai tribe of Kup, Kerowagi district; and on that basis found the second defendant committed trespass and awarded damages accordingly. It is too late for the plaintiff to now assert ownership and challenge the SABL with this proceeding after 13 years from when WS 712 of 2007 was filed and 12 years since the title to the land was issued.
23.	On that, I find the timing of this action a month after the Supreme Court decision in SCA no 16 of 2017 or Covec (PNG) Ltd v Kama [2020] SC1912 awarding over K4million in judgement to the first defendants, highly suspect. It gives an inference of an attempt to benefit in the fruits of the judgement without contributing to it or a second bite at the cherry, either way, an abuse of the Court's process has occurred by the prolonged delay. The plaintiffs' attempts to provide good reasons for not taking any legal action in 2007 or why it commenced this proceeding on 11 March 2020 are not reasonable. The reason to commence this proceeding basing off the completion of the defendants' case in Covec (PNG) Ltd v Kama is a flimsy reason.
24.	Taking into account all these considerations, the Court must guard against abuse of its process and ensure the interests of justice are upheld. While fraud allegations are very serious and summary dismissal under Order 12 rule 40 NCR is not permitted by Order 12 rule 37 NCR, the preclusion is not a hard and fast rule and can in clear cases on competency, be summarily dismissed under another jurisdictional basis. See: Lord & Company Ltd v Inapero [2014] SC1624 and Paiko v Mondoro [2022] N9934. 

25.	The inherent jurisdiction of the Court to do justice in the circumstances of a case in section 155 (4) of the Constitution and Order 12 rule 1 of the National Court Rules to my mind provide sufficient jurisdictional basis and were also relied on by the applicant. 

Section 155 (4) of the Constitution protects primary rights or interests where existing laws are deficient to render protection. See Powi v Southern Highlands Provincial Government [2006] SC844.

26.	Here, the Peter Kama's evidence (Doc 20) is that he obtained the SABL following proper processes of determining customary land ownership in Portion 1239C which were not challenged by the plaintiffs. The applicants submit they have indefeasible title to the land which is protected under section 33 of the Land Registration Act.

I accept this submission as the jurisdictional basis of the other reliefs sought are not adequate to render protection.  
In addition, the applicants have the benefit of the Supreme Court judgement upholding and recognising their ownership in Portion 1239C and right to participate in the economic benefits from the extraction and use of the gravel from that land.  I am bound by that Supreme Court decision.

In Koti v Susame [2007] N6586 His honor Cannings, J departed from the conventional judicial review approach of the National Court and applied section 155(4) of the Constitution to do justice to a case that was in mediation and litigation over 20 years, with only one party over several others not accepting the medicated agreement.

I consider this is a suitable case to invoke this Court's inherent jurisdiction under 155(4) of the Constitution and to an extent, Order 12 rule (1) of the National Court Rules.

27.	Before concluding, on the issue of the applicants standing in failure to file a defence which was raised by the respondents, I do not agree with the submission and form the view that the applicants have sufficient standing to move the application by reason of their notice of intention to defend filed on 16 June 2020.  See Hiwi v Rimua [2015] SC1460 and Geru Holdings Limited v Kruse & Ors [2023] SC2492.

28.	For all of the foregoing reasons, I exercise my discretion pursuant to section 155 (4) of the Constitution and Order 12 rule (1) of the National Court Rules to summarily dismiss the entire proceedings for being an abuse of Court process and therefore, the proceedings are incompetent.

ORDER

29.     The formal orders of the Court are:-

1) The first defendants application is granted.

2)  The proceeding is summarily dismissed in its entirety.

3) Reasonable costs of the application are awarded to the applicants/first defendants to be paid by the plaintiffs and the second defendant on a party/party basis, to be taxed, if not agreed. 

4) Time for entry of the orders is abridged to the date of settlement by the Registrar of the National Court which shall take place, forthwith.

5) The Court File be closed and archived.

Orders accordingly,
________________________________________________________________
Tindiwi Lawyers: Lawyers for the Plaintiffs
Gagma Legal Services Lawyers: Lawyer for the First Defendant
Mapiso: Lawyer for the Second Defendant