SC1556
PAPUA NEW GUINEA
		      [IN THE SUPREME COURT OF JUSTICE]

SC REF NO 5 OF 2016

REFERENCE PURSUANT TO CONSTITUTION, SECTION 18(2), 
		
RE ALLEGED IMPROPER BORROWING 
OF AUD1.239 BILLION LOAN

OMBUDSMAN COMMISSION
First Intervener

RIGO LUA
Second Intervener

PHOEBE SANGETARI
Third Intervener

THE HONOURABLE PETER O’NEILL MP, PRIME MINISTER
Fourth Intervener

THE HONOURABLE ANO PALA MP, ATTORNEY-GENERAL 
Fifth Intervener

Waigani: Salika DCJ, Mogish J, 
Cannings J, Kassman J, Higgins J 

2016:  12th & 16th December 

PRACTICE AND PROCEDURE – application  to adduce additional facts and evidence in a reference by the National Court under Constitution, Section 18(2) – whether procedure for such an application is available under Supreme Court Rules – whether application an abuse of process.

The Ombudsman Commission and two members of the Commission, (referred to for the purposes of this decision as ‘the applicants’) were parties to a reference made by the National Court under Section 18(2) of the Constitution to the Supreme Court of questions of constitutional interpretation and application, concerning the jurisdiction of the Ombudsman Commission under the Constitution and the Organic Law on the Ombudsman Commission. They filed an application to adduce additional evidence and facts “to assist the Supreme Court properly exercise its jurisdiction”. The application was made under Section 185 of the Constitution and various provisions of the Supreme Court Rules 2012 – Order 3, Rule 2(a), Order 4, Rule 10(b), Order 11, Rule 9 – on the groundsthat the facts found by the National Court for the purposes of the reference contained too many assumed facts and omitted material facts, which, left as they were, would not assist the Supreme Court in properly deliberating on the constitutional questions. The application was opposed by the two other parties to the reference, the Prime Minister and the Attorney-General.

Held:

(1)	The application was incompetent as neither the Constitution nor the Supreme Court Rules make provision for such an application; and there were other readily available means by which the applicants’ concerns about the findings of facts made by the National Court could have been raised; and in the event of doubt, they could have applied for directions.

(2)	The application was misconceived as the nature of a Section 18(2) reference is such that it is a reference by the National Court to the Supreme Court of questions of constitutional interpretation and application arising in proceedings before the National Court, based on findings of fact made by the National Court. It is not the function of the Supreme Court to amend the facts on the basis of which the National Court has framed its questions.

(3)	The application was misconceived for a further reason, in that the full court of the Supreme Court, constituted by three or more Judges under Section 161(2) of the Constitution, is ill-equipped to hear and consider evidence and make findings of fact, which is what the applicants were inviting the Court to do. Furthermore, the applicants were asking the Court to make findings of fact without allowing the other parties to the reference to challenge the applicants’ contentions of fact or adduce their own evidence, which would amount to a breach of the principles of natural justice. 

(4)	The application was dismissed as being an abuse of process and the Court ordered that it would proceed to hear the reference. 

Cases cited

The following cases are cited in the judgment:

Application by Francis Gem (2010) SC1065
Application by Francis Gem (2010) SC1266
Application by Ila Geno (2014) SC1313
Belden Norman Namah MP v Rimbink Pato MP, National Executive Council & The State (2014) SC1304
Ken Norae Mondiai v Wawoi Guavi Timber Co Ltd (2007) SC886
Peter O’Neill  v Ombudsman Commission, Rigo A Lua & Phoebe Sangetari (2015) N5857
Re Reference by Ken Norae Mondiai (2010) SC1087
Reference by the East Sepik Provincial Executive (2011) SC1133
SC Ref No 2 of 2016, Re interpretation of Section 169(4)(c) of the Constitution (2016) SC1508
Special Reference pursuant to Constitution, Section 19; Reference by the East Sepik Provincial Executive (2011) SC1154
Talibe Hegele v Tony Kila (2011) SC1124

APPLICATION

This was an application to adduce additional evidence and facts for the purposes of the hearing, by the Supreme Court, of a Constitution, Section 18(2) reference.

Counsel:
	
V L Narokobi &M Efi, for the first, second & third Interveners
M M Varitimos QC & P Tabuchi, for the fourth Intervener
D Levy &A Manase, for the fifth Intervener

16th December, 2016

1.     BY THE COURT:  This is a ruling on an application by three parties to a Constitution, Section 18(2) reference, to adduce additional evidence and facts for the purposes of the hearing of the reference. The reference and the application arise in the following circumstances.  

THE REFERENCE

2.    On 19 July 2016 the National Court, constituted by the Honourable Justice Catherine Davani, referred 11 questions of constitutional interpretation and application to the Supreme Court under Section 18(2) of the Constitution. 

Section 18(2) of the Constitution states:

Subject to this Constitution, where any question relating to the interpretation or application of any provision of a Constitutional Law arises in any court or tribunal, other than the Supreme Court, the court or tribunal shall, unless the question is trivial, vexatious or irrelevant, refer the matter to the Supreme Court, and take whatever other action (including the adjournment of proceedings) is appropriate.

3.    The questions arose in proceedings before her Honour, OS No 15 of 2015, in which the Prime Minister, Mr O’Neill, sought declarations, injunctions and other relief regarding a provisional report by the Ombudsman Commission of an investigation into the alleged improper borrowing of AUD1.239 billion from the Union Bank of Switzerland [UBS] to purchase shares in Oil Search Limited and related matters, which apparently contained provisional findings of wrong conduct on the part of Mr O’Neill. Mr O’Neill’s fundamental contention in the National Court was that the Commission lacked jurisdiction under the Constitution, Section 219(1) and the Organic Law on the Ombudsman Commission (those being the Constitutional Laws under which the Commission purported to conduct its investigation and prepare and circulate to certain bodies and individuals its provisional report), to investigate and make findings of wrong conduct against him.  

4.    Prior to the trial of the originating summons Mr O’Neill applied by notice of motion for an order that certain questions of constitutional interpretation and application be referred to the Supreme Court under Section 18(2) of the Constitution. Her Honour granted the application and referred the following 11 questions to the Supreme Court

1.	Whether, on the proper interpretation or application of Section 219(1)(a) of the Constitution, the Prime Minister of the Independent State of Papua New Guinea does not come within the description of any “member”, “officer”, “employee” or “person” under Section 219(1)(a) of the Constitution.

2.	If the answer to question (1) above is yes, does the Ombudsman Commission therefore lack jurisdiction to investigate any conduct on the part of the Prime Minister of the Independent State of Papua New Guinea under Section 219(1)(a) of the Constitution into the alleged improper borrowing of AU$1.239 billion loan from the UBS AG by the Government to purchase 149,309,244 shares in Oil Search Ltd and improper tender and procurement of consultants in relation to the borrowing.

3.	Whether, on the proper interpretation or application of Section 13 of the Organic Law on the Ombudsman Commission, the Prime Minister of the Independent State of Papua New Guinea does not come within the description of any “member”, “officer” or “employee” under Section 13 of the Organic Law on the Ombudsman Commission.

4.	If the answer to question (3) above is yes, does the Ombudsman Commission therefore lack jurisdiction to investigate any conduct on the part of the Prime Minister of the Independent State of Papua New Guinea under Section 13 of the Organic Law on the Ombudsman Commission into the alleged improper borrowing of AU$1.239 billion loan from the UBS AG by the Government to purchase 149,390,244 shares in Oil Search Ltd and improper tender and procurement of consultants in relation to the borrowing.

5.	Whether, on the proper interpretation or application of Section 219(1)(a) of the Constitution and Section 13 of the Organic Law on the Ombudsman Commission, the Ombudsman Commission lacks jurisdiction to publish the results of any investigation carried out by it, whether by forwarding a copy of its conclusions, recommendations and suggestions to the persons holding the positions described in Section 23(1) of the Organic Law on the Ombudsman Commission or otherwise, in relation to any conduct on the part of the Prime Minister of the Independent State of Papua New Guinea into the alleged improper borrowing of AU$1.239 billion loan from the UBS AG by the Government to purchase 149,390,244 shares in Oil Search Ltd and improper tender and procurement of consultants in relation to the borrowing. 

6.	Whether, on the proper implementation or application of Section 17 of the Organic Law on the Ombudsman Commission, if the Ombudsman Commission has not informed the responsible person, in this case the plaintiff, of its intention to make the investigation, it lacks jurisdiction to investigate and publish the results under Section 23 of the Organic Law on the Ombudsman Commission of any such investigation carried out by it, whether by forwarding a copy of its conclusions, recommendations and suggestions to the persons holding the positions described in Section 23(1) of the Organic Law on the Ombudsman Commission or otherwise, in relation to any conduct on the part of the Prime Minister of the Independent State of Papua New Guinea into the alleged improper borrowing of AU$1.239 billion loan from the UBS AG by the Government to purchase 149,390,244 shares in Oil Search Ltd and improper tender and procurement of consultants in relation to the borrowing.

7.	Whether the Ombudsman Commission is and was required to comply with Section 17(1) of the OLOC, and in particular, inform the Prime Minister of its intention to make an investigation relating to conduct on the part of the Prime Minister:

(a)	Before investigating the Prime Minister “into the alleged improper borrowing of AU$1.239 billion loan from the Union Bank of Switzerland, Aktiengesellschaft (Australian Branch) to purchase 149,390,244 shares in Oil Search Limited and improper tender and procurement of consultants in relation to the borrowing”;

(b)	Issuing or publishing a document titled “Provisional Report” – Investigation into the alleged improper borrowing of AU$1.239 billion loan from the Union Bank of Switzerland, Aktiengesellschaft (Australian Branch) to purchase 149,390,244 shares in Oil Search Limited and improper tender and procurement of consultants in relation to the borrowing”, making comments adverse to or derogatory of the Prime Minister;

(c)	Issuing or publishing any further or other report “into the alleged improper borrowing of AU$1.239 billion loan from the Union Bank of Switzerland, Aktiengesellschaft (Australian Branch) to purchase 149,390,244 shares in Oil Search Limited and improper tender and procurement of consultants in relation to the borrowing”, making comments adverse to or derogatory of the Prime Minister.

8.	If the answer to question (7)(a) is yes, is any investigation conducted without so informing the Prime Minister ultra vires the power of the Ombudsman Commission?

9.	If the answer to question (7)(b) above is yes, is the issuing or publication of the tiled, “Provisional Report” – “Investigation into the alleged improper borrowing of AU$1.239 billion loan from the Union Bank of Switzerland, Aktiengesellschaft (Australian Branch) to purchase 149,390,244 shares in Oil Search Limited and improper tender and procurement of consultants in relation to the borrowing”ultra vires the power of the Ombudsman Commission? 

10.	If the answer to question (7)(c) above is yes, is any issuance or publication of any further or other report “into the alleged improper borrowing of AU$1.239 billion loan from the Union Bank of Switzerland, Aktiengesellschaft (Australian Branch) to purchase 149,390,244 shares in Oil Search Limited and improper tender and procurement of consultants in relation to the borrowing”ultra vires the power of the Ombudsman Commission?

11.	Whether the Ombudsman Commission has lawful authority, power or jurisdiction to make any comments in any report distributed or published by it (whether provisional, final or otherwise), which are adverse to or derogatory of the Prime Minister, if such comments require, before they can be properly made, an interpretation or application of provisions of Constitutional Laws by the Ombudsman Commission.  

5.   Her Honour made various findings of fact for the purposes of the reference, which are set out in:

•	her Honour’s judgment, giving reasons for making the reference, Peter O’Neill  v Ombudsman Commission, Rigo A Lua & Phoebe Sangetari (2015) N5857; and

•	a document entitled “Facts (Pertaining to the Reference)”, prepared by her Honour, which forms part of the Reference, as required by Order 4, Rule 4(a) of the Supreme Court Rules.

PARTIES 

6.   The parties to the reference are:

First intervener		:	Ombudsman Commission
Second intervener	:	(Chief Ombudsman) Rigo A Lua 
Third intervener		: 	(Ombudsman) Phoebe Sangetari
Fourth intervener 	: 	(Prime Minister) Hon Peter O’Neill
Fifth intervener 		: 	(Attorney-General) Hon Ano Pala

THE APPLICATION

7.    On 26 October 2016 the first, second and third interveners (referred to for the purposes of this decision as ‘the applicants’) made the application, which is now before us for determination, to adduce additional evidence and facts “to assist the Supreme Court properly exercise its jurisdiction”. 

8.   The additional evidence and facts are:

•	transcripts of the National Court proceedings before Davani J;
•	a certified copy of the National Court file in the proceedings before her Honour;
•	additional facts referred to in an affidavit of Michael Efi, Senior Legal Officer of the Ombudsman Commission, prepared for the purposes of the reference.

9.    The application is made under Section 185 of the Constitution and various provisions of the Supreme Court Rules 2012 – Order 3, Rule 2(a), Order 4, Rule 10(b), Order 11, Rule 9 – on the grounds that the facts found by the 10.  

10.    National Court for the purposes of the reference contained too many assumed facts and omitted material facts, which, left as they were, will not assist the Supreme Court in properly deliberating on the constitutional questions. 

11.    The application is opposed by the two other parties to the reference, the Prime Minister and the Attorney-General.

DECISION

12.    After hearing extensive oral and written submissions, we have decided to dismiss the application, for three reasons.

1 	THE APPLICATION IS INCOMPETENT 

The application is incompetent as:

•	neither the Constitution nor the Supreme Court Rules make provision for such an application; 

•	there are other readily available means by which the applicants’ concerns about the findings of facts made by the National Court could have been raised; and 

•	in the event of doubt, they could have applied for directions;

•	it is not up to this Court to make provision for such an application, where none exists.

Neither the Constitution nor the Supreme Court Rules make provision for such an application

13.    The application filed on 26 October 2016 states that it is based on four laws: Section 185 of the Constitution and three provisions of the Supreme Court Rules 2012 – Order 3, Rule 2(a), Order 4, Rule 10(b) and Order 11, Rule 9.

14.    Section 185 of the Constitution states:

If in the circumstances of a particular case before a court no provision, or no adequate provision, is made in respect of a matter of practice or procedure, the court shall give ad hoc directions to remedy the lack or inadequacy.

15.   Order 3, Rule 2(a) of the Supreme Court Rules states:

Where any proceedings under Rule (1) [proceedings within the original jurisdiction of the Court] are pending before the Court … a direction not involving a final decision upon the proceedings … may be made by a Judge. 

16.    Order 4, Rule 10(b) of the Supreme Court Rules (which is in Division 4.3 of the Rules: provisions applicable to an application or reference made pursuant to Constitution Sections 18 and 19) states:

The applicant or referrer may amend the application, reference or special reference … if a party has intervened, with leave of the court or of a Judge.

17.   Order 11, Rule 9 of the Supreme Court Rules states:

Where a person desires to take any step in proceedings under these rules and the manner or form of the procedure is not prescribed, the person may apply to a Judge for directions.

18.    It will be observed that, of the four provisions cited as the jurisdictional basis of the application, three of them (Section 185 of the Constitution and Order 3, Rule 2(a) and Order 11, Rule 9 of the Supreme Court Rules) simply authorise a person (usually but not necessarily a party to existing proceedings) to apply to the Court for directions and authorise the Court or a Judge to give directions on a matter of practice and procedure. 

19.   Those provisions do not allow a party to give itself directions and to make an application for which no provision is made by the Rules, which is what the applicants have done. Though the applicants rely on these provisions, they have not asked the Court for directions. They have, in effect, given themselves directions and gone ahead and made an application for additional evidence and facts to be adduced. This is most irregular. 

20.   As for the remaining provision relied on, Order 4, Rule 10(b) of the Supreme Court Rules allows an “applicant or referrer” to amend “the application, reference or special reference”. We consider that the terms “applicant” and “referrer” in Order 4, Rule 10(b) are used in the following way:

•	“applicant” means a person who makes an application, with leave, to the Supreme Court, under Section 18(1) of the Constitution (such a proceeding is properly labelled as an ‘application’, not a ‘reference’ and the party commencing it is an ‘applicant’, not a ‘referrer’: see Re Reference by Ken Norae Mondiai (2010) SC1087, Belden Norman Namah MP v Rimbink Pato MP, National Executive Council & The State (2014) SC1304, Application by Ila Geno (2014) SC1313).

•	“referrer” means, in the case of a Section 18(2) reference, the National Court, and, in the case of a Section 19(1) reference, the referring authority. 

21.    Order 4, Rule 10(b) does not allow interveners – such as the applicants – to amend a Section 18(2) reference.

22.   The upshot is that none of the four provisions relied on by the applicants provide a jurisdictional basis for the application that is before us. And there are no other provisions of the Constitution or the Supreme Court Rules that allow for such an application. 

There are other readily available means by which the applicants’ concern about the findings of facts could have been raised

23.    We understand the motive for the applicants wanting to have the facts, on which the reference is based, amended: they want to ensure that the Supreme Court gives its opinion on a correct statement of facts. That might be a valid concern but the applicants are not without a remedy for addressing that concern. Other options were available:

24.    First, they could have applied to the referring Judge for amendment of the reference, under Order 4, Rule 9 of the Supreme Court Rules, which states:

The Judge by whom the reference is made or, in his absence, another Judge of the National Court may, upon the application of a party or of his own motion, upon notice to the parties, amend the reference at any time before argument.

Secondly, they could have applied for leave to appeal against the decision of the National Court to make the Section 18(2) reference to the Supreme Court.

Thirdly, they could have made a slip rule application to the National Court. 

We suggest that the first of the options outlined above was the best one. Any of them would have been a more appropriate course of action than making the application that is before us.

Application could have been made for directions 

25.    This, of course, is another option that could have been exercised. ‘When in doubt, ask for directions from the Court’ is a useful and safe course of action to take where the procedure is unclear (Talibe Hegele v Tony Kila (2011) SC1124).

26.    The applicants were apparently aware of this option. Their application is based on provisions which allow parties to seek directions from the Court. But, as we pointed out above, this application does not actually seek directions. It is an application to adduce evidence and facts. It presupposes that directions have been given to allow the application to be made. Obtaining directions to facilitate the making of an application is one thing. Making the application is another. The applicants have confused and merged the two procedures that would need to be invoked, if the application were to be properly before the Court.

Not up to the Court to make provision for applications, where none exists

27.    We are faced with a novel application. We know of no other case in which a party to a Section 18(2) Supreme Court reference has made an application to amend the facts on which the reference is based. The novelty of an application does not mean that it should be entertained. It is the task of a party making an application of any sort to ensure that such an application is provided for by some discrete law. It is not the task of the Court to entertain an application, for which no provision is made (Ken Norae Mondiai v Wawoi Guavi Timber Co Ltd (2007) SC886, SC Ref No 2 of 2016, Re interpretation of Section 169(4)(c) of the Constitution (2016) SC1508).

28.    This is an incompetent application and must be dismissed, for that reason alone.

2 	THE APPLICATION MISCONCEIVES THE NATURE AND PURPOSE OF A SECTION 18(2) REFERENCE

29.    The application is misconceived as the nature of a Section 18(2) reference is such that it is a reference by the National Court to the Supreme Court of questions of constitutional interpretationand application arising in proceedings before the National Court, based on findings of fact made by the National Court. It is not the function of the Supreme Court to amend the facts on the basis of which the National Court has framed its questions. It would not be proper to do that. Nor would it be proper for the parties to the reference to agree on some altered set of facts. The progenitor of the reference is the National Court. In this case, as we stated above, if the applicants wanted to have the statement of facts amended, their first step should have been to go back to the National Court and apply to the National Court to amend its statement of facts.

30.    It must also be borne in mind that in the normal course of events, after the Supreme Court gives its opinion on the 11 questions referred to it, its opinion will be transmitted to the National Court, which will then apply the Supreme Court’s opinion to the matter before it. 

31.   Here it is evident that the trial of the originating summons had not commenced when the National Court made the reference. So the statement of facts put to the Supreme Court can properly be regarded as presumed facts or preliminary findings of fact made for the purpose of eliciting the Supreme Court’s opinion on questions of constitutional interpretation and application. There is still scope, once the proceedings resume in the National Court, for evidence to be called by all parties, so that final findings of fact can be made for the purposes of the trial of the originating summons. So, not only is the application before us misconceived. It is an unnecessary application.  

3	THE APPLICATION MISCONCEIVES THE FACT FINDING FUNCTIONS OF THE NATIONAL COURT AND THE SUPREME COURT

32.    The Supreme Court has made it clear in two recent cases, Application by Francis Gem (2010) SC1065 and Special Reference pursuant to Constitution, Section 19; Reference by the East Sepik Provincial Executive (2011) SC1154, that the full court of the Supreme Court, constituted by three or more Judges under Section 161(2) of the Constitution, is ill-equipped to hear and consider evidence and make findings of fact. 

33.    If it is necessary for the Supreme Court to make findings of fact, the preferred practice is for the Court to direct a single Judge of the Court to hear evidence and make findings of fact. This procedure, which was invoked in both the cases referred to above (see Application by Francis Gem (2010) SC1266 and Reference by the East Sepik Provincial Executive (2011) SC1133) is utilised under Order 3, Rule 3 of the Supreme Court Rules, which states:

Upon the direction of the Court, either on the application of a party to the proceedings or of its own motion, a single Judge may take evidence upon any issue of fact for the determination of the proceedings and state those facts as found by him, and the Court may act upon such statement of facts so far as it thinks fit to adopt it.

34.    The applicants have ignored the preferred practice. They have not invited us to consider giving a direction to a single Judge under Order 3, Rule 3. They have come directly to the full court of the Supreme Court and asked us to allow evidence to be adduced and invited us to make findings of fact. This is most irregular.

35.    Furthermore, the applicants are asking the Court to make findings of fact without allowing the other parties to the reference to challenge the applicants’ contentions of fact or adduce their own evidence, which would amount to a breach of the principles of natural justice. This is most peculiar.

CONCLUSION

36.     The application is refused as it is incompetent and an abuse of process. 

Order 4, Rule 4 of the Supreme Court Rules is in these terms:

A reference under Constitution Section 18(2) shall state—

(a)	the question to be referred and such facts as are admitted or found by the Judge of the National Court and are necessary for the proper consideration of the question; and
(b)	if the facts referred to in sub-rule (a) cannot be conveniently and shortly stated, the findings of the Judge of the National Court shall be annexed to the reference; and
(c)	where a question involves the pleadings before the court or tribunal from which it is referred, then so much of the pleadings shall be set out in the reference as raise the question.

37.    We are satisfied that the reference meets all these requirements. It is properly before us. We are obliged, in accordance with and subject to Section 18(2) of the Constitution and Order 4 of the Supreme Court Rules, to determine the reference. It will be heard as soon as practicable. The question of costs of the application is adjourned.   

ORDER

(1)	The application by the first, second and third interveners, filed 20 October 2016, to adduce additional evidence and facts, is dismissed as being incompetent and an abuse of process.

(2)	The Court will proceed to hear the reference in accordance with directions of the Listings Judge, in accordance with Order 13 (listings rules) of the Supreme Court Rules.

(3)	The question of costs of the application will be addressed in the course of hearing the reference.

Judgment accordingly,	
______________________________________________________________
Counsel to the Commission:      Lawyer for the 1st, 2nd& 3rd Interveners 	 Young & Williams Lawyers:        Lawyers for the 4th Intervener			
Manase & Co Lawyers:                Lawyers for the 5th Intervener