SC1545

PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]

SCM NO. 19 OF 2014

BETWEEN
HUI TECK LAU – in his capacity as director of Wewak Agriculture Development Ltd & directors of Sepik Oil Palm Plantations Ltd
First Appellants

AND
WEWAK AGRICULTURE DEVELOPMENT LIMITED
 Second Appellant

AND
SEPIK OIL PALM PLANTATION LIMITED
 Third Appellant

AND
DANIEL MATU, MATHEW KOIMO, BOB SUMBOI, GEORGE WRONGDIMI, WILLIE JONDUO AND ANDREW KABAI
Fourth Appellants

AND
LEO MANIWA for himself and on behalf of Kowiru Villagers
First Respondents

AND
PHILIP DAGUN, ELIAS MAIMBE, MICHAEL CAYBAH, MICHAEL MAMBER, FRANCIS JIM, PETER YUWORA, ERNEST WAMB, JACOB WINDUO AND FLORIAN SABNA
Second Respondents

AND
HONOURABLE PUKA TEMU in his capacity as Minister of Lands & Physical Planning
Third Respondent

AND
PEPI KIMAS in his capacity as Secretary of Lands & Physical Planning
Fourth Respondent

AND
INDEPENDENT STATE OF PAPUA NEW GUINEA
Fifth Respondent

Waigani: Higgins, J
2016: 30th September, 5th& 25th October 

SLIP RULE APPLICATION – standing of representative plaintiffs – plaintiff landowners in an area purportedly leased to defendant developers – not all landowners joined – action valid on behalf of those represented as claimants – their action is an action in rem not in personam – invalidity of Lease affects  all purportedly conferred or denied rights to their land whether parties or not – leave to apply slip rule refused

PNG CASES CITED:	

Malewo v Faulkner [2009] PGSC 3; SC 960
Malewo v Faulkner [2007] PGNC 150; N3357
Trawen v Itanu [2011] PGSC 14; SC 1109
Van Der Kreek v Van Der Kreek [1979] PNGLR 185

OVERSEAS CASES CITED:

Comandate v Pan Shipping [2006] FCAFC 195
Old Digger Pty Ltd v Azuko Pty Ltd [2002] FCA 1158
Patrick Stevedores [1996] FCA 1257
Ramsay v Pigraim [1968] HCA 34; (1968) 118 CLR 271 
UWA v Gray [2008] FCA 498

COUNSEL:
Messrs G. Egan & P. Kuman, for the 1st, 2nd& 3rdAppellants
Mr M. Muga, for the 4th Appellant
Mr H. Wally, for the 1st, 2nd& 3rd Respondents
Mr R. Saulep, for the 4th& 5th Respondents

DECISION

25th October, 2016

1.	HIGGINS, J:	This is an application for leave pursuant to Order 11 Rule 32(3) of the Supreme Court Rules to proceed with a “slip rule” application following the disposition of these proceedings by judgment delivered on 31 August 2016.

2.	That decision affirmed a decision of Gavara-Nanu J which declared invalid a Special Agricultural and Business Lease (SABL) issued to the second appellant.  The third appellant is an associated company.  The first appellant is a director of each of them.

3.	The respondents are customary landowners within the SABL area.  The appellants raise the point that the first and second respondent landowners are representative of 2 villages only in the SABL area.

4.	The appellants rightly concede that a final judgment on appeal will not lightly be re-opened.

5.	It is sufficient for present purposes to refer to the decision of Trawen v Itanu [2011] PGSC 14; SC 1109 to engage the principles governing an application such as the present.

6.	The “slip” relates only to one issue decided in favour of the first and second respondents by Gavara-Nanu J.  That was,as cited by the trial judge, at [16] of his judgment:

“The [appellants] have raised issues regarding the authority of the [1st& 2ndRespondents] to bring this application on behalf of other landowners.  After carefully perusing and considering the materials before the Court, I am satisfied that the [1st& 2nd Respondents] have the authority of the landowners to bring this application to Court.  There is overwhelming evidence showing that landowners have agreed for the [1st& 2ndRespondents] to make this application.  The [1st& 2ndRespondents] have also acted under the authority of duly executed Powers of Attorney which have been signed by the elders of the Kowiru and Kaubaraka villages which are in the SABL area.”

7.	It is important to note that his Honour did not find that all landowners in the SABL supported the application.  He found that some did.  In particular, the owners in the Kowiru and Kaubaraka villages.  In other words, he accepted the evidence of the first and second respondents that they were authorised to apply and retain lawyers for the purpose of challenging the SABL as it affected their interests.

8.	They did not purport to represent all the landowners in the SABL area.  If their complaint had been, as in Malewo v Faulkner [2009] PGSC 3; SC 960, of environmental damage, or even personal injury, then each person suffering such loss or damage may sue or join in suing for such loss or damage.  In Malewo, the appellants were customary landowners in the Ok Tedi River area.  Their allegation was of environmental damage leading to both loss of personal rights of user and personal injury.  It was damage in personam.  A fundamental defect was failure to identify the cause of action relied upon or to set out the elements of any such cause of action against each of the several defendants against whom orders were sought.  On the issue of representative capacity, the appellants had sought, at a late stage, to file affidavits supporting their authority to represent other clan members.  Leave was refused.  Hence there was no evidence of such authority before the Court.

9.	That may be contrasted with the present case.

10.	It is settled law that, in an action purporting to be a representative action, those purportedly represented must each authorise the lead parties to so represent them.

11.	The terms of Rule 13 of Order 5 are clear:

“(1)	Where numerous persons have the same interest in any proceedings the proceedings may be commenced, and, unless the Court otherwise orders, continued, by or against any one or more of them as representing all or as representing all except one or more of them.”

12.	In truth, the concept is simple and convenient.  A class or group having a common cause or interest need not sue separately but may sue as a group.  Not every person affected need join in.  Indeed, some apparently in the same interest might oppose the action.

13.	Those who are represented must, for the reasons identified by Davani J in Malewo v Faulkner [2007] PGNC 150; N3357, as affirmed by the Supreme Court at [2009] PGSC 3; SC 960, be clearly identified.

14.	A party so represented is entitled to all the benefits of a party but is also subject to all liabilities if an adverse order is made.  For that reason a party may opt out of the action or decline to opt in or even oppose it, despite having the same apparent interest as those who have opted in.
15.	It also follows that each party so represented must have standing to bring the action as if they were the sole claimant.
16.	In this case there was no doubt as to standing.  Each of the original plaintiffs was and was found in fact to be, a landowner in the SABL area.

17.	Mr Kuman for the appellants, contends that the trial judge erred in not finding that the plaintiffs lacked authority to represent any group other than the two village representatives mentioned above and did not have capacity to represent any other persons or groups in the SABL area.

18.	At the outset, it should be acknowledged that Mr Kuman is perfectly correct.  However, it is only those landowners who are represented who are entitled to the relief sought by them.

19.	However, unlike a claim for damages for loss of environmental amenity or personal injury, the success of their claims invalidates the SABL.

20.	That declaration of invalidity is a declaration in rem not merely in personam.  There is, as Mr Kuman made clear, no issue taken with his Honour’s findings in that regard as confirmed by this Court.  They were fully argued and addressed by the judgment now sought to be re-visited under the slip rule.  The distinction is referred to but not explained in Van Der Kreek v Van Der Kreek [1979] PNGLR 185.

21.	The distinction is between an action seeking remedies personal to the claimant, such as damages for personal injury or personal rights to relief.  An action is in rem if it relates not just to the rights as between the parties but determines rights in property conclusive against the world.  Primarily that refers to actions such as the present where the claimants contend that their property rights are paramount over those of the appellants under the SABL.  Such property rights may also be in respect of ships or land (the “res”) - see Comandate v Pan Shipping [2006] FCAFC 195; Ramsay v Pigraim [1968] HCA 34; (1968) 118 CLR 271 (contrast with collisions at sea and road collisions - former in rem, latter in personam); Patrick Stevedores [1996] FCA 1257; Old Digger Pty Ltd v Azuko Pty Ltd [2002] FCA 1158 – [actions on patents] – see also UWA v Gray [2008] FCA 498.

22.	The distinction between actions in rem and actions in personam illustrates the fundamental misconception entertained by the appellants.  Mr Kuman’s submission assumes that because the relief obtained by the respondent landowners affects all landowners in the area of the SABL that those other landowners were purportedly represented in the action by the respondent landowners without their consent.

23.	That is simply a mischaracterisation of the action.  Because the relief sought was declaratory of the status of the SABL its invalidity, if so found, affects all subject to it just as the invalidity of a law affects every person in the land not merely those who sought its invalidation.

24.	It follows that whatever may be the defects in form of the slip rule application, it is fundamentally flawed in that the standing of the respondent landowners was not in doubt nor was their authority to the principal plaintiffs to represent them.  Unfortunately for the appellants, the relief granted necessarily affected all rights conferred by the SABL on whomsoever they were purportedly conferred.

25.	For those reasons, the application for leave should be refused with costs.

Kuman Lawyers:    Lawyers for the 1st, 2nd& 3rdAppellants	
Twivey Lawyers:   Lawyers for the 1st, 2nd& 3rd Respondents   
H Best Lawyers:    Lawyers for the 4th Appellant
Saulep Lawyers:    Lawyers for the 4th& 5th Respondents