SC1016

PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]

SCM 3 OF 2009

BETWEEN:

RON NAPITALAI FOR AND ON BEHALF OF THE BOARD OF APPEAL 
COMMITTEE OF PNG PORTS CORPORATION LIMITED
First Appellant

AND:

PNG PORTS CORPORATION LIMITED
Second Appellant

AND:

CASPER WALLACE
Respondent

Waigani: Gavara Nanu, Hartshorn and Makail JJ.
2009: 1st September,
2010: 8th February

APPEAL - Appeal against grant of leave to judicially review – interlocutory judgment – whether trial judge fell into error - whether PNG Ports Corporation Limited a governmental or public body – whether terms and conditions of employment of Respondent set by statute – whether Respondent’s termination was of a private nature – whether remedy of judicial review available 

Facts:

The respondent was granted leave to judicially review as to the termination of his employment with PNG Ports Corporation Ltd (PNG Ports). The appellants PNG Ports and its Board of Appeal Committee, obtained leave to appeal and now appeal the decision to grant leave to judicially review.

Held:

1. PNG Ports is not a governmental or public body as held by the trial judge.

2. The Employment Determination of 2002 does not apply to PNG Ports employees.

3. PNG Ports is not created by statute but is incorporated under the Companies Act.

4. The appellants have shown that the trial judge fell into error.

5. The respondent’s termination is of a private law nature. As such the remedy of judicial review is not available to him. Thus the trial judge fell into error in granting leave to the respondent for his termination from employment to be judicially reviewed.

Cases cited: 

Curtain Bros (PNG) Ltd v. UPNG (2005) SC788
Ereman Ragi v. Joseph Maingu (1994) SC459
Garamut Enterprises Ltd v. Steamships Trading Co Ltd (1999) SC625
Tony Kila v. Talibe Hegele (2007) SC855
Young Wadau v. Alfred Daniel & Ors [1995] PNGLR 357

Counsel:

E. G. Andersen, for the Appellants
J. Unido, for the Respondent

8th February, 2010

1. BY THE COURT: The respondent was granted leave to judicially review as to the termination of his employment with PNG Ports Corporation Ltd (PNG Ports).

2. The appellants, PNG Ports and its Board of Appeal Committee, obtained leave to appeal and now appeal the decision to grant leave to judicially review.

3. In essence the grounds of appeal are that judicial review is not available as a remedy against PNG Ports and even if it is, there has been inordinate delay in seeking that remedy. Consequently the appellants submit, the trial judge fell into error in granting leave.

4. The respondent submits that judicial review is a remedy that is available to him, that the question of delay was not raised and that the trial judge did not fall into error.

5. The decision of the trial judge in granting leave to judicially review is an interlocutory judgment: Garamut Enterprises Ltd v. Steamships Trading Co Ltd (1999) SC625, Tony Kila v. Talibe Hegele (2007) SC855, and is the exercise by him of judicial discretion in considering an application under Order 16 Rule 3 National Court Rules. This court's role in an appeal from such a decision is considered in Curtain Bros (PNG) Ltd v. UPNG (2005) SC788. We agree with and respectfully reproduce the following passage from that decision: 

"The appellant Court will not interfere with a discretionary judgment on a procedural matter within its jurisdiction, except where the exercise of that discretion is clearly wrong. A discretionary judgment may be set aside if an identifiable error occurred in the exercise of discretion. Alternatively, it may be set aside where there is no identifiable error, but the resulting judgment or order is "unreasonable or plainly unjust" and such that an error can be inferred. These principles are well established. We adopt a passage from Kitto J in the Australian High Court case of Australia Coal and Shale Employees’ Union v The Commonwealth (1956) 94 C.L.R. 621 at p.627, which was adopted by Clarkson J. in Breckwoldt & Co. (N.G.) Pty Ltd v. Gnoyke [1974] PNGLR 106 at p.112 – 113:

"The decision by the primary judge to stay the action was made in exercise of a judicial discretion and I accept that in those circumstances the principles on which this Court should act are as described by Kitto J. in Australian Coal and Shale Employees’ Union v The Commonwealth ... the true principle limiting the manner in which appellate jurisdiction is exercised in respect of decisions involving discretionary judgements is that there is a strong presumption in favour of the correctness of the decisions appealed from, and that that decision should therefore be affirmed unless the court of appeal is satisfied that it is clearly wrong. A degree of satisfaction to overcome the strength of the presumption may exist where there has been an error which consists in acting upon a wrong principle, or giving weight to extraneous or irrelevant matters, or failing to give weight or sufficient weight to relevant considerations, or making a mistake as to the facts. Again, the nature of the error may not be discoverable, but even so it is sufficient that the result is so unreasonable or plainly unjust that the appellate court may infer that there has been a failure properly to exercise the discretion which the law reposes in the court of first instance…"

6. We will first consider whether the trial judge fell into error in deciding that judicial review was available against PNG Ports. The appellants submit that the trial judge fell into error on this question by amongst others, finding that PNG Ports was a governmental or public body, that the respondent's terms and conditions of employment were determined by or under statute and by not following two previous decisions of this court that are on point.

Whether judicial review available against PNG Ports 

a) Whether PNG Ports is a governmental or public body

7. The trial judge in his judgment stated that the critical question when determining whether the decision to terminate a person's employment has been made by a public body whose employment decisions can be subject to judicial review, is whether the dismissal can be regarded as a matter of public law as distinct from private law.

8. One of the factors to be considered when determining that question according to the trial judge, was whether the decision maker could be regarded as a governmental body. The trial judge held that PNG Ports is a governmental or public body as it:

"…is a State-owned enterprise and the management and its affairs are still regulated by statute and by the Executive arm of government."

9. The appellants submit that the trial judge fell into error here as although PNG Ports is a State owned corporation, its affairs and the appointment of its managers are controlled by its Board of Directors, as with any other company incorporated under the Companies Act, and not by the State. 

10. The provisions of sections 9, 9A and 10 Harbours Act upon which the respondent and the trial judge appear to rely and which give powers to the Minister responsible and the National Executive Council in respect of employees, officers and the General Manager, concern the Papua New Guinea Harbours Board (Harbours Board) and not PNG Ports. PNG Ports is the successor company to the Harbours Board.

11. The National Executive Council has the right to object to a proposed nomination of a person to be a member of the Board of a State Owned Enterprise such as PNG Ports pursuant to s. 9A Independent Public Business Corporation of Papua New Guinea Act, but the State under this provision does not have the right to appoint the senior management of PNG Ports or to run its affairs. The Board of Directors of PNG Ports can hire and fire the management as it sees fit.

12. PNG Ports is not merely a corporatised version of the Harbours Board. PNG Ports performs only some of the functions of the Harbours Board and the Harbours Board’s commercial activities but the governmental, regulatory and advisory functions of the Harbours Board have been transferred to the Department of Transport, the Independent Consumer and Competition Commission and the National Maritime Safety Authority. 

13. Further, the Public Finances (Management) Act, the Salaries and Conditions Monitoring Committee Act and the Public Service Conciliation and Arbitration Act do not apply to PNG Ports as they did to the Harbours Board.

14. For the above reasons, the appellants submit that PNG Ports cannot be regarded as a governmental or public body as found by the trial judge. We note in this regard that counsel for the respondent conceded before us that PNG Ports was now a private body as opposed to the Harbours Board which could be regarded as a governmental body.

15. After considering the submissions of the appellants and the relevant provisions of the Harbours Act, we are not satisfied that it is correct to regard PNG Ports as a governmental or public body as held by the trial judge.

b) whether terms and conditions of employment set by statute

16. A further factor to be considered in determining whether the respondent's dismissal can be regarded as a matter of public law as opposed to private law according to the trial judge, was whether the respondent's employment was determined by or under statute. The trial judge found that the respondent's terms and conditions of employment and the procedure by which he could be dismissed are set by and regulated by statute; in this instance by the Employment Determination of 2002, a subordinate legislative enactment.

17. The appellants submit that the trial judge fell into error in making this finding as the Employment Determination of 2002, which was promulgated by the then Chairman of the Harbours Board, did not apply to the respondent's employment at the time of his termination.

18. The appellants submit that although the terms and conditions of employees of PNG Ports are essentially the same as those contained in the Employment Determination of 2002, this is because the employees were transferred from the Harbours Board to PNG Ports pursuant to s. 36C Harbours Act, "on the same terms and conditions of employment as applied to the employee immediately before the transfer of employment", and not because the Employment Determination of 2002 applies to PNG Port employees. 

19. Further, the appellants submit, the terms and conditions of employment contained in the Employment Determination of 2002 were implied by statute, s. 36C Harbours Act, into the private employment contracts of all employees of PNG Ports including the respondent.

20. It is clear on its face the appellants submit, that the Employment Determination of 2002 only applies to Harbours Board employees. It is not correct that the Employment Determination of 2002 sets the terms and conditions of employment and the procedure by which an employee of PNG Ports can be dismissed, as held by the trial judge.

21. Counsel for the respondent submits that although PNG Ports is now a private body, it has used provisions under the Employment Determination of 2002, which is public law, to dismiss the respondent. Consequently, the respondent is entitled to apply for judicial review. This submission in our view, fails to address how the Employment Determination of 2002 can apply when clearly on its face it applies to Harbours Board employees as distinct from PNG Port employees.

22. After considering the submissions of Counsel, the Employment Determination of 2002 and relevant provisions of the Harbours Act, we are satisfied that notwithstanding that terms and conditions of employment contained in the Employment Determination of 2002 are implied by s. 36C Harbours Act into the private employment contracts of PNG Ports employees, the Employment Determination of 2002 does not apply to PNG Ports employees. 

c) Prior decisions

23. The appellants submit that the trial judge fell into error in not following the decisions of this court in Ereman Ragi v. Joseph Maingu (1994) SC459 and Young Wadau v. Alfred Daniel & Ors [1995] PNGLR 357 as they are binding upon him. The trial judge found that the facts of the case before him could be distinguished from those in Ereman Ragi (supra) and Young Wadau (supra).

24. The trial judge cited the following passage from Ereman Ragi (supra):

"The respondent here claimed his wrongful dismissal from employment was a matter of public law. In fact it is merely a matter of a private law nature, the right of an employer to control and deal with his own employees. There is no statutory duty here, there is no statutory protection which makes this a matter of public law. This is purely a matter of the relationship between a master and servant. Whilst the master here is a Board created by statute the employment of the staff of the Board is not a matter of statute, there are no provisions in the legislation setting up the Board which give terms and conditions of employment or other matters which have been raised in this case. Merely stating in the Act that the Board may employ staff does not by itself make that employment a matter of public law."

25. The trial judge then stated that:

"In Wadau the Supreme Court came to a similar conclusion regarding the PNG Harbours Board. The board dismissed the plaintiff from his position as legal officer to the Board, exercising its private law powers. The plaintiff did not hold office under a particular statutory provision. The rights and obligations of the Board and the officer were regulated by private law. The Supreme Court, relying on Maingu, said that the plaintiff was correctly refused leave for judicial review."

26. In both Ereman Ragi (supra) and Young Wadau (supra), the employers were created by statute and the employment conditions were not regulated by statute. In this instance PNG Ports is not created by statute but is incorporated under the Companies Act. As to the employment conditions of its employees, as we have found, the subordinate legislative enactment held by the trial judge to regulate employment conditions, does not do so.

27. Given the above, we are not satisfied that the facts of this case are such that they can be distinguished from those in Ereman Ragi (supra) and Young Wadau (supra) to the extent that a result different to those given in these two cases can be reached. 

28. We are satisfied that the appellants have shown that the trial judge fell into error as indicated above.

29. In addition, finding as we have, we are satisfied that the respondent’s termination is of a private law nature. As such the remedy of judicial review is not available to him. Thus the trial judge fell into error in granting leave to the respondent for his termination from employment to be judicially reviewed.

30. In deciding as we have, it is not necessary to consider the other arguments of Counsel.

Orders

a) The appeal is upheld and the whole of the judgment of the National Court at Kimbe of 19th August 2009 in proceeding OS (JR) 396 of 2008 is set aside.

b) The respondent shall pay the appellants’ costs of the appeal.

_______________________________________
Gadens Lawyers: Lawyers for the Appellants
Muromu Lawyers: Lawyers for the Respondent