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Waigani Centre Pty Ltd v The Independent State of Papua New Guinea and Minister for Lands [1997] PGSC 14; SC517 (25 November 1997)

Unreported Supreme Court Decisions

SC517

PAPUA NEW GUINEA

[SUPREME COURT OF JUSTICE]

SCA N0 59 OF 1996
WAIGANI CENTRE PTY LTD - APPELLANT
V
THE INDEPENDENT STATE OF PAPUA NEW GUINEA & MINISTER FOR LANDS - RESPONDENTS

Waigani

Kapi DCJ Los Jalina JJ
10 June 1997
25 November 1997

EXPIRATION OF TOWN SUBDIVISION LEASE - Application for renewal - Consideration of such application under s. 66 of the Land Act (Cap 185).

Counsel

J Baker for the appellant

P Mogish for the respondents

25 November 1997

KAPI DCJ LOS JALINA JJ: The appellant was the holder of a Town Subdivision Lease (TSL) over property described as Lot 2, Section 429 Hohola. The TSL was granted for a period of five years and it expired on 9 February 1991. In an application dated 12 September 1991 (see page 99 of the appeal book) the appellant sought to renew the TSL.

In a notice dated 28 November 1991 (see page 49 of the appeal book) the second respondent requested the appellant to show cause why the lease should not be forfeited on the grounds that the appellant neglected to comply with the improvements covenant or condition in the lease and failure to pay the rent. In response, lawyers for the appellant wrote a letter dated 17 December 1991 (see page 50 of the appeal book) and gave certain explanations and enclosed a copy of the application for the renewal of the lease dated 12 September 1991. It is not necessary for the purposes of this appeal to deal with the details of the notice to show cause. In a follow up letter dated 19 December 1991, the lawyers for the appellant referred to an indication by the second respondent that the notice to show cause would be withdrawn. In the same letter the lawyers indicated that they were awaiting the next meeting of the Land Board to determine the application by the appellant for the renewal of the TSL. On 23 January 1992 the Minister placed an advertisement for tenders in the National Gazette in respect of the land in question.

The lawyers for the appellant were instructed to follow up the application for the renewal of the lease and also to persuade the second respondent to withdraw the tender of the land in question. It appears that the second respondent refused to comply with the request.

Subsequently, the appellant applied to the National Court for judicial review. Leave for judicial review was granted and the matter came before Salika J for substantive hearing. The principal ground for review was that the second respondent had not made a decision as to the application for renewal of the lease and therefore this was a denial of natural justice. The appellant sought an order in the nature of writ of mandamus to direct the second respondent to make a decision on the application for renewal of the lease. The trial judge refused to grant the orders and dismissed the application.

The appellant has appealed against this decision. The respondents raised objection to the competency of the appeal on two grounds: (a) that the appeal was filed well outside the 40 days limit which is required by s 17 of the Supreme Court Act; and (b) that grounds 3 (b) and (d) are questions of fact and leave to appeal has not been sought. Counsel for the respondents abandoned the first ground and therefore it is not necessary to consider it. Counsel, however, took up the objection on the second ground. We can deal with this objection very briefly. The relevant grounds of appeal are:

“(b) The learned trial judge erred in law in finding that the respondent was not under a duty in accordance with the rules of natural justice to refer to the Appellant’s application for a renewal of a Town Subdivision Lease to the Land Board.

...

(d) The learned trial judge erred in law in finding that the refusal of the Respondent to refer the Appellant’s application for renewal of a Town Subdivision Lease to the Land Board and instead to offer the land the subject of the Lease for tender was not harsh and oppressive and in breach of section 41 of the Constitution.”

We are of the opinion that both grounds of appeal raise questions of law and therefore do not require leave to appeal. We would dismiss the objection.

The grounds of appeal raise two related questions. Is the application for renewal of the TSL by the appellant properly before the second respondent? If it is, has the second respondent dealt with the application in accordance with the law?

Counsel for the appellant sought to argue that there is evidence to suggest that renewal of similar applications have been considered by the Minister and such applications have been renewed. The appellant has on the basis of this principle made a similar application and that the Minister is required by law to make a decision one way or the other.

In our view the basis of the appellants argument is based on the wrong premise in law. The question is not whether the Minister has considered such an application before. The question is whether or not an application for renewal is on foot at law and whether or not the Minister is required by law to make a decision.

In order to deal with these questions, we must establish the appellant’s status under the law. The TSL expired on the 9 February 1991. There can be no question that the appellant’s right to the lease expired on that date. In the circumstances the appellant has applied for the renewal of the lease. The question then arises; what is the proper procedure under the law for renewal of a TSL? An appellant’s rights will be determined in accordance with the law.

In our view the circumstances in this case fall to be considered under s. 66 of the Land Act (Cap 185). The appellant obtained the lease under this provision. The lease has expired. There is no express provision relating to a renewal of a TSL where the lease has expired. We consider that the position is governed by s. 66 (1):

“Where there is a vacant Government land within a township that, in the opinion of the Minister, is suitable for subdivision in accordance with this section, he may, by notice in the National Gazette, invite applications for the grant of a State lease under this section over the whole or part of the land.”

The position at law would be this. At the expiration of a lease, the rights of a lessee expires and the land becomes vacant in law. The Minister may invite persons to make application for the land under s. 66 (1) of the Land Act. The Minister then considers all the applications in accordance with s. 66 (4) and (5) of the Land Act.

In the present case, the appellant has submitted an application for renewal of the lease before the Minister invited applications in accordance with the provisions of s. 66 of the Land Act. It may be implied from all the circumstances that the Minister did not consider the appellant’s application but purported to forfeit the lease. It is not necessary to set out the details of the forfeiture in this case. This is not the subject of the appeal. In any case, by the time steps were taken to forfeit the lease, the lease had already expired. The position in law is that the appellant had no further rights under the lease and the land in question became vacant for purposes of s. 66 (1) of the Land Act. In our opinion the Minister rightly invited applications for this land in the National Gazette in accordance with s. 66 (1) of the Land Act. The appellant and any others would be eligible to apply. In practical effect what the Minister has done in this case is that he refused to consider the sole application by the appellant but determined instead to invite applications in accordance with s. 66 (1). The appellants are entitled to apply and it will be a matter for the Minister to decide who should get the lease. The trial judge came to the same conclusion in the following passage:

“The Minister has not called for tenders yet. When he does call for tenders the plaintiff and all other potential bidders are expected to put in their bids. There is nothing preventing the plaintiff from submitting its bid. It must be appreciated that once a lease expires and extinguishes any rights of anyone over the property. The fact that the Minister has refused to renew the lease is a matter for his discretion because once the lease expired, the land in my respectful view became vacant land. Now that the land is vacant land the Minister may invite applications for the grant of a State lease (see s. 66 of the Land Act).” [sic]

We have reached the conclusion that the application by the appellant should be considered together with others who may wish to apply in accordance with the provisions of s. 66 of the Land Act. In our view the second respondent has taken the proper steps under the law.

In the result we would dismiss the appeal with costs. We further order that the injunction granted by the National Court and entered on 27 July 1994 be discharged.

Lawyers for the Appellant: Henaos

Lawyer for the Respondents: Solicitor-General