SC2109

PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]

SCA NO. 136 OF 2018

BETWEEN:
LINA PEYAPE, AMOS PEYAPE and JUMBO PEYAPE
First Appellants

AND:
RAGA KAVANA, REGISTRAR OF TITLES
Second Appellant

AND:
INDEPENDENT STATE OF PAPUA NEW GUINEA
Third Appellant

AND:
PEYAPI WAIYA aka PEYAPE MUGALO
Respondent

Waigani: David J, Murray J, Kangwia J
2020: 14th December
2021: 21st May

LAND LAW – change of name on title - disposition of interest in land by wife and children of registered proprietor – disposition of interest in land to be in writing evidenced by a contract or some note or memorandum of the contract – interest of land can be created by parol – statutory requirements to be met - Frauds and Limitations Act, Sections 2, 3, 4, 5 and 21 – Land Registration Act, Sections 11, 18, 19, 20, 22, 24, 25, 26, 27, 33, 42(1),(2) and (3), 160 and 162.

Cases Cited:

Mudge v The Secretary for Lands (1985) PNGLR 387
Emas Estate Development Pty Ltd v John Mea & Ors (1993) PNGLR  215
Active Auto Parts (PNG) Pty Ltd v Brian Hull (1990) N833
Jacobs v Kwaindu [1991] PNGLR 366
Pamela Ipi Pangu v Ian Ellery (2007) N3227
Leontine Ofoi v Kris Bongare (2007) N3248
PNG Deep Sea Fishing Ltd v Luke Critten (2010) SC1126
Lae Bottling Industries Ltd v Lae Rental Homes Ltd (2011) SC1120
Sonny Atua v Grace Kemmah (2011) N4296
Kol Toki v Moeka Morea Helai (2016) SC1558
Pius Tikili v Home Base Real Estate Ltd (2017) SC1563
The National Council of Young Men’s Christian Association of PNG (Inc) v Firms Services Ltd (2017) SC1596
Rimbunan Hijau (PNG) Ltd v Enei (2017) SC1605
PNG Bible Church Inc v Carol Mandi (2018) SC1724

Treatise Cited:

Donald Gifford, Statutory Interpretation, The Law Book Company Limited, 1990

Counsel:

Paul Harry, for the First Appellants
Julius Bakaman, for the Second and Third Appellants
Robert Awalua, for the Respondent

JUDGMENT

21st May, 2021

1. 	BY THE COURT:  INTRODUCTION:  This is a decision on an appeal against the whole of the judgment of the National Court constituted by Justice Polume-Kiele (the primary judge) delivered on 24 August 2018 at Waigani in National Court proceedings, WS No. 649 of 2009, Peyapi Waiya also known as Peyape Mugalo v Lina Peyapi, Amos Peyapi and Jumbo Peyapi, first defendants, Raga Kavana as Registrar of Titles, second defendant, and the Independent State of Papua New Guinea, third defendant in relation to a dispute over a residential property described as Allotment 30 Section 117 Hohola (Erima), National Capital District and contained in State Lease Volume 21 Folio 128 (the Property). The primary judge entered judgment in favour of the respondent, then plaintiff Peyapi Waiya also known as Peyape Mugalo (the Respondent) when she found that; there was extensive violation of statutory procedures under the Land Registration Act and Frauds and Limitations Act which amounted to constructive fraud in the change of name of the Respondent as the registered proprietor of the Property on the title to Amos Peyapi Mugalo and the subsequent transactions leading to the unlawful transfer of the Property to the first appellants, Lina Peyapi, Amos Peyapi and Jumbo Peyapi (the First Appellants) that warranted the setting aside of the endorsements on the title recording the unlawful transactions; and ordered the restoration of the interest in land in the Property to the Respondent.  

2.	The appeal lies without leave pursuant to Sections 4(2)(a) and (b) and 14(1)(a) and (b) of the Supreme Court Act in that it raises questions of law or of mixed fact and law and is an appeal from a judgment delivered following a substantive hearing.  We note however that no specific reference was made to Section 4(2), but since no issue was raised on that, we propose not to take the matter any further.   

BACKGROUND FACTS

3.	Lina Peyape, one of the First Appellants, is the wife of the Respondent,  and they have about six children.  The other First Appellants, Amos Peyape and Jumbo Peyape are two of their children.  

4.	On 25 February 1999, the State granted the Respondent, a 99-year residential lease over the Property commencing on 20 October 1994 and expiring on 19 October 2093.

5.	On 12 April 1999, the particulars of the name of the registered proprietor was changed from “Peyapi Wayai” to “Amos Peyapi Mugalo” through Instrument No.S.21048.

6.	On 13 March 2006, an Official Copy of the State Lease to the Property was issued and registered against the title on 24 March 2006 through instrument No.S.41576(A).

7.	On 24 March 2006, the First Appellants were registered as proprietors of the Property as joint tenants through Instrument No.S.41576 produced on 13 March 2006.

8.	On 21 July 2006, particulars of the registered proprietor on the title were changed from “Lina Peyapi, Amos Peyapi and Jumbo Peyapi as joint tenants” to “Lina Peyapi, Amos Peyapi and Jumbo Peyapi” through Instrument No.S.42566 produced on 21 July 2006 without indicating the type of co-ownership.

9.	Following a dispute with the First Appellants in relation to his share of rental income generated from the Property, in 2006, the Respondent commenced a claim in connection to that in the National Court by WS No.1464 of 2006 against the First Appellants.  It was then that he discovered the irregular transactions performed against his interest which were registered on the title to the Property. 

10.	On 15 June 2009, the Respondent commenced proceedings in the National Court for the title to the Property to be restored to him.

11.	On 24 August 2018, after a contested trial, the primary judge entered judgment in favour of the Respondent when she declared that the change of name from Peyapi Waiya to Amos Peyapi Mugalo that was effected on the title on 12 April 1999 was null and void due to constructive fraud and therefore ordered that the registration be set aside and also ordered the restoration of the interest in land in the Property to the Respondent.

12.	The First Appellants then filed this appeal by way of the Notice of Appeal filed on 3 September 2018 (the Notice of Appeal).    

GROUNDS OF APPEAL

13.	The Notice of Appeal sets out, at paragraph 3, nine grounds of appeal and they can be distilled and summarized as follows:

1.	The primary judge erred in finding that the First Appellants obtained title to the Property by fraud when no actual fraud was committed by the First Appellants pursuant to Section 33(a) of the Land Registration Act.

2.	The primary judge failed to consider the First Appellants’ defence that the Respondent’s statement of claim did not properly meet the mandatory requirement of pleading the particulars of fraud alleged.

3.	While the primary judge correctly held that indefeasibility of title will not apply unless personal dishonesty is demonstrated, she erred in finding that there was personal dishonesty on the part of the First Appellants in the absence of conclusive evidence.

4.	The primary judge erred in finding that the Respondent did not relinquish his right to the Property pursuant to Section 21 of the Frauds and Limitation Act when to the contrary, the Respondent, who was of sound mind, consented to relinquish the Property and have it disposed of to the First Appellants in the family’s interest.

5.	The primary judge erred in finding that Section 162(4) of the Land Registration Act requires publication of a notice for a replacement title when notice is only required for a lost or destroyed instrument of title and not for an instrument of title that is delivered up in a dilapidated condition under Section 162(1), (2) and (3) of the Land Registration Act.

6.	The primary judge erred in strictly finding that there was no written agreement to transfer the interest in the Property to the First Appellants contrary to Section 2(1) of the Frauds and Limitations Act when Section 3(1)(b) of the Frauds and Limitations allows for creation of interest in land not in writing to have the force and effect of an interest at will.

7.	The primary judge erred in strictly finding that there was no consideration provided in support of the transfer of the interest in land in the Property to the First Appellants contrary to Section 3(1)(b) of the Frauds and Limitations Act.

8.	The primary judge erred in finding that Sections 18, 19, 42 and 161 of the Land and Registration Act had been breached when it was obvious that the First Appellant being illiterate could not have breached those provisions.

9.	The primary judge erred in not applying her mind to the equally competing legal and equitable interests of the parties who are all members of the same family unit.

14.	The subject matter of these grounds can be grouped as follows:

1.	The First Appellants obtained title to the Property by fraud - Grounds 1, 2 and 3;
2.	The Respondent, who was of sound mind, consented to relinquish his interest in the Property and have it disposed of to the First Appellants in the family’s interest – Ground 4;
3.	Publication of a Notice of Replacement of instrument of title – Ground 5;
4.	Creation of interest in land not in writing, but by parol, notwithstanding the absence of consideration, has force and effect of an interest at will – Grounds 6 and 7;
5.	Illiteracy of respondent is excusable for want of compliance with statutory requirements for transfer of interest in land – Ground 8; and
6.	The transfer of the interest in the Property is a family matter – Ground 9.
   
RELIEF SOUGHT

15.	The main substantive relief sought in the Notice of Appeal are that:

1.	The appeal be allowed.
	2.	The decision of the primary judge be quashed.
	3.	The Respondent’s name be included on the title together with the First Appellants in the interest of justice.

ISSUES

16.	This judgment concerns the following major issues:

1.	Whether the primary erred in finding that the First Appellants obtained title to the Property by fraud when no actual fraud was committed by the First Appellants pursuant to Section 33(a) of the Land Registration Act and against rules on pleading fraud? 
2.	Whether the primary judge erred in finding that the Respondent did not consent to relinquish his interest in the Property to the First Appellants?
3.	Whether the primary judge erred in finding that Section 162(4) of the Land Registration Act requires publication of a notice for a replacement title? 
4.	Whether the primary judge erred in finding that the interest in the Property could not be transferred in the absence of an agreement in writing? 
5.	Whether the primary judge erred in finding that Sections 18, 19, 42 and 161 of the Land Registration Act were breached for not complying with statutory requirements for the transfer of interests in land when the First Appellant could have been excused for being illiterate?
6.	Whether the primary judge erred in not applying her mind to the equally competing legal and equitable interests of the parties who are members of the same family unit?
 
EVIDENCE

17.	At the trial before the primary judge, the Respondent relied on both documentary and oral evidence.  Documentary evidence was adduced by way of sworn affidavits and their annexures and sworn oral evidence adduced through oral examination including cross-examination of the witnesses.

18.	The Respondent relied on and read the affidavits of: 

1.	Peyape Waiya Mugalo sworn on 20 January 2010 and filed on 21 January 2010 (Exhibit P1, 214AB);
2.	Peyape Waiya Mugalo sworn on 12 July 2010 and filed on 16 August 2010 (Exhibit P2, 226AB); and
3.	Philip Mugalo sworn on 23 April 2010 and filed on 28 April 2010 (Exhibit P3, 234-270AB).

19.	At the trial, the First Appellants relied on both documentary and oral evidence as well.  Documentary evidence was adduced by way of the sworn affidavit of Lina Peyape sworn on 29 January 2010 and filed on 3 February 2010 (Exhibit D1, 241AB) and the annexures and the sworn oral evidence adduced under oral examination including cross-examination of the witness.

20.	In the primary judge’s written judgment, she also includes affidavits filed in support of the Respondent’s case as well as the First Appellants’ which were not formally tendered for purposes of admission into evidence, but she took judicial notice of them nevertheless.  

21.	At the trial, the Second and Third Appellants relied on and read the affidavit of Henry Wasa sworn and filed on 15 February 2011 (Exhibit S1, 278AB, Tab 18). Henry Wasa did not give any oral evidence.  His affidavit offered no assistance to the determination of the substantive issues for trial as it only provides an explanation by the incumbent of the position of the Registrar of Titles about the missing file relating to the Property and his inability to produce a copy of the Registrar’s copy of the title and provide an explanation about the status of the title as a consequence.

CONSIDERATION AND DETERMINATION

Fraud (Grounds 1, 2 and 3)

22.	The First Appellants essentially contend that the primary judge erred because she found that the Respondent was unable to prove actual fraud. 

23.	The Respondent contends that Ground 1 has no merit and should be dismissed as the primary judge correctly found on the evidence before her that in the absence of actual fraud having been proven by the Respondent, there was sufficient evidence of constructive fraud.   

24.	In both the primary judge’s oral and written decisions, she decided that the current law as to what constitutes fraud under Section 33(1)(a) of the Land Registration Act was that there can be “actual fraud” or “constructive fraud" and she referred to the contrasting judgments of this Court in Mudge v The Secretary for Lands (1985) PNGLR 387 and Emas Estate Development Pty Ltd v John Mea & Ors (1993) PNGLR  215 which have been followed in many subsequent cases:  see pages 317-318.  The primary judge said she was bound by both decisions, but she decided to follow Emas Estate Development Pty Ltd v John Mea & Ors (1993) PNGLR 215 given the circumstances and facts of this case she highlighted starting from paragraph 34, page 318 to paragraph 57, page 323, Appeal Book.  She makes her conclusions on the irregularities involved in the change of name from “Peyapi Wayai” to “Amos Peyapi Mugalo” and the subsequent transactions registering the First Plaintiffs as the registered proprietors.  The primary judge said in her judgment that the Respondent was unable to prove actual fraud, but there was evidence of constructive fraud due to dishonesty.
 
25.	Upon registration taking place, the registered instruments are accorded priority according to when each of them was lodged and not according to when each of them was executed:  see Sections 24, 25, 26 and 27, Land Registration Act.   On registration of an instrument, Section 26 states, among others, that the estate or interest in the instrument passes or ceases in the manner and subject to the covenants and conditions set out in the instrument or declared by the Land Registration Act to be implied in instruments of that nature.  The Respondent was the initial recipient of the instrument of title to the Property having been issued the title to him on 25 February 1999 and registered on 11 March 1999. 

26.	The title of a registered proprietor generally gives immunity to the registered proprietor from any adverse claims by virtue of Section 33 of the Land Registration Act which imports the principle of indefeasibility of title under the Torrens system of title. Section 33(1)(a) to (i) however set out nine exceptions to the principle of indefeasibility of title and one of them specified under Section 33(1)(a) is fraud. 

27.	The primary judge’s observation of the current position of the law applying to what constitutes fraud under Section 33(1)(a) of the Land Registration Act is correct.  There are two opposing views propagated by this Court.   The case of Mudge v The Secretary for Lands (1985) PNGLR 387 applies the traditional view of proving actual fraud while the case of Emas Estate Development Pty Ltd v John Mea & Ors (1993) PNGLR 215 has widened the scope of fraud to include constructive fraud.  While both positions of law have been applied in the National Court consistently since their enunciation, the same cannot be said for this Court.  There is now a strong line of Supreme Court judgments that have followed and applied the view expressed in Emas Estate Development Pty Ltd v John Mea & Ors (1993) PNGLR 215 and some of these cases are; PNG Deep Sea Fishing Ltd v Luke Critten (2010) SC1126, Lae Bottling Industries Ltd v Lae Rental Homes Ltd (2011) SC1120, Kol Toki v Moeka Morea Helai (2016) SC1558, Pius Tikili v Home Base Real Estate Ltd (2017) SC1563,   The National Council of Young Men’s Christian Association of PNG (Inc) v Firms Services Ltd  (2017) SC1596 and PNG Bible Church Inc v Carol Mandi (2018) SC1724.  These cases support the proposition that in many situations, it will not be appropriate to insist on proof of actual fraud before the National Court considers cancelling the registered proprietor’s title.  It will be sufficient if constructive or equitable fraud is proven.  Constructive fraud exists where the circumstances of a transfer of title are so unsatisfactory, irregular or unlawful, it is tantamount to fraud, warranting the setting aside of registration of title.  Given this, there was nothing wrong with the primary judge following the case of Emas Estate Development Pty Ltd v John Mea & Ors (1993) PNGLR 215. 

28.	We find that the primary judge did not commit an error in arriving at her conclusion that while there was no proof of actual fraud, there was evidence of constructive fraud which warranted the setting aside of the registration on the title of the First Appellants as registered proprietors and the interest in land in the Property restored to the Respondent.  Grounds 1 and 3 therefore have no merit and are dismissed. 	

29.	As to Ground 2 concerning lack of particulars for fraud in the Respondent’s pleadings which we note is based on Order 8 Rule 30 (Fraud, etc) of the National Court Rules, the primary judge observed that the Respondent’s pleadings demonstrated that there was no specific pleadings of actual fraud (para 29, page 317, Appeal Book) and that all allegations of fraud demonstrated by the pleadings were denied by the First Appellants (para 6, page 303, Appeal Book).  This is a matter that ought to have been raised by any of the appellants in interlocutory proceedings before the matter was fixed for trial.  The First Appellants are bound by their own conduct in allowing the matter to go to trial based on the status and nature of the pleadings then.

30.	In any event, the primary judge was satisfied that; firstly, although there was no pleading of actual fraud, there was sufficient pleading of constructive fraud (p.312, Appeal Book); and secondly, there was sufficient evidence of constructive fraud by dishonesty starting from the change of name of the Respondent to the registration of the First Plaintiffs as proprietors of the Property which was supported by the Respondent’s pleadings (p.322, Appeal Book). 

31.	This ground has no merit. We find no error on the part of the primary judge and dismiss the ground. 

Consent to relinquish interest in the Property (Ground 4)

32.	This ground is grounded on the primary judge’s observation found at page 294, Appeal Book lines 12 to 15 where her Honour said: 

“…. there is no written agreement in the approved form and attested by an independent witness to transfer the registered title – or registered interest in the title to the property from the plaintiff to the first defendants and this is in breach of section 21 of the Frauds and Limitations Act.”  

33.	The First Appellants contend that reference by the primary judge to Section 21 of the Frauds and Limitations Act appears to be inconsistent with the requirement for agreements to dispose of interest in land under Section 2(1) of  that Act to be in writing and that may be due to a typographical error, but if that were not the case, then it was not disputed that the Respondent was of sound mind at all material times when the relevant transactions were performed for; the change of name on the title on 12 April 1999; replacement of the dilapidated title on 24 March 2016; and the transfer of the title to the First Appellants on 24 March 2006 and these were done with his consent.  The only ‘disability’ on the part of the Respondent was that he was illiterate and that is not captured under Section 21. 

34.	It was further argued by the First Appellants that the primary judge had not demonstrated how Section 21 had been breached so in that regard, she committed an error.

35.	On the other hand, the Respondent submitted that this ground had no merit and should be dismissed as; first, the primary judge did not elaborate on the application of Section 21; and secondly, the primary judge found on the available evidence before her that the Respondent, being the legitimate registered proprietor of the Property, did not consent to all the transactions performed and endorsed on the title starting from the change of his name to the registration of the First Appellants as registered proprietors of the Property.

36.	The writing requirement for the creation and disposition of an interest in land is found in Sections 2(1) and 4 of the Frauds and Limitations Act.  We will elaborate on that when addressing Grounds 6 and 7 later on in the judgment. Section 21 clearly has no relevance and application to the writing requirement for the sale of land or disposition of interest in land and it may have been a typographical error as is suggested by the First Appellants in referring to that provision and to that extent we concur with the First Appellant’s submission. 

37.	However, as to the substance of her Honour’s finding, we find that she did not commit an error.  Consequently, we concur with the Respondent’s submission and find that this ground has no merit and is dismissed.   

Publication of Notice for Replacement of instrument of title (Ground 5)

38.	The First Appellants submitted that the Second Appellant, Registrar of Titles was not obligated to give notice of an intention to make a new instrument of title or official copy by publication in the National Gazette or in a newspaper circulating in the country under Section 162(4) of the Land Registration Act prior to replacing the dilapidated Owner’s Copy of the title to the Property and therefore there was no breach of that provision.

39.	The Second and Third Appellants submitted that where title is replaced either because it had been lost or destroyed or defaced under Section 162(1) of the Land Registration Act, the name of the proprietor remains the same. 

40.	The Respondent contended that the primary judge did not err in finding that Section 162(4) of the Land Registration Act requires publication by the Second Appellant of a notice of intention to make a new instrument of title or official copy of title in the National Gazette because:
	
1.	Section 162 must be read as a whole; and
2.	The primary judge did not make any specific ruling on Section 162(4).  

41.	The primary judge in her oral decision at page 294, Appeal Book at lines 22 to 30 said:

“Fifthly, there is no evidence of a notice being published by the second defendant in the National Gazette as to a replacement title or official copy of the title deed in breach of Section 162(4) of the Land Registration Act.”

42.	In the written judgment found at the second bullet point at p.319 Appeal Book and p.322, paragraph 52, Appeal Book, the primary judge states that the Respondent did not apply for a replacement instrument of title and the action of the Second Appellant in facilitating the transaction did so in breach of a number of provisions of the Land Registration Act including Section 162(4).  

43.	Section 162 regulates how a replacement instrument of title of official copy is processed and it states:

“REPLACEMENT OF INSTRUMENT OF TITLE.

(1) 	Where an instrument of title has been lost, destroyed or defaced, the registered proprietor or, if he is dead, his legal personal representative, may apply to the Registrar for a replacement instrument of title or official copy.
(2) 	An application under Subsection (1) shall be accompanied by–
	(a) 	such evidence as the Registrar considers sufficient of the loss, destruction or defacing; and
(b) 	particulars of all mortgages, charges or other matters affecting the land or the title to the land.
(3) 	The Registrar may–
(a) 	on receipt of an application made in accordance with Subsections (1) and (2), together with the prescribed fee; or
(b) 	on his own volition,
if he considers it necessary, replace an instrument of title by making a new instrument of title or official copy, as the circumstances require.
(4) 	When an application under this section relates to a lost or destroyed instrument of title the Registrar shall give at least 14 days’ notice of his intention to make a new instrument of title or official copy by advertisement in the National Gazette and in at least one newspaper circulating in the country.
(5) 	A new certificate of title or official copy made under this section shall be–
(a) 	endorsed with a memorial stating the circumstances under which it is made; and
	(b) 	available for all purposes and uses for which the original instrument of title would have been available and be as valid for all purposes as the original.”

44.	The term “Registrar” is defined in 2 of the Land Registration Act and it “means the Registrar of Titles appointed under Section 4.” 

45.	According to Section 162(1), a replacement instrument of title or official copy can be made by the Registrar of Titles in three situations and these are where the instrument of title is:

	1.	lost; or
	2.	destroyed; or
	3.	defaced.

46.	It is not disputed that a replacement title was made by the Registrar on the production of the Owner’s Copy of the instrument of title to the Property which purportedly was in a dilapidated condition. In our view, a dilapidated instrument of title would fall within the meaning of a “defaced” instrument of title.

47.	It is a mandatory requirement for the Registrar to give at least 14 days notice of his intention to make a new instrument of title or official copy by advertisement in the National Gazette and in at least one newspaper circulating in the country under Section 162(4) in only two situations and these are where the instrument of title is:   
	 
1.	lost; or
	2.	destroyed.

48.	Section 162(4) does not apply to the making by the Registrar of a replacement instrument of title or official copy with regard to a defaced instrument of title.

49.	In the circumstances, we find that there is no requirement for a notice for a replacement title to be given.

50.	Consequently, we find that the primary judge committed an error and we uphold this ground.     

Creation of interest in land by parol (Grounds 6 and 7)

51.	The First Appellants submitted that Grounds 6 and 7 have merit and should be upheld as Section 3 of the Frauds and Limitations Act allows an interest in land to be created by parol which has the force and effect of an interest at will only notwithstanding any consideration having been given in respect of it.

52.	The Second and Third Appellants made no specific submissions on the grounds under consideration and therefore were of no assistance.  

53.	The Respondent contended that Grounds 6 and 7 have no merit and should be dismissed.  He argued that the primary judge did not err when finding that there was no written agreement to dispose of his interest in the Property to the First Appellants because; firstly, that was in accordance with the present law; and secondly, there was no room to consider Section 3 of the Frauds and Limitations Act as the primary judge found on the available evidence that he did not authorize the change of name on the title and the subsequent transactions to transfer his interest in land in the Property to the First Appellants.

54.	Although there is generally no formal requirement of writing in the law of contract, provisions in the Frauds and Limitations Act make it necessary for a contract for the sale or other disposition of land or an interest in land to be in writing or evidenced by a written note or memorandum if the contract is to be enforceable by action.  

55.	The relevant provisions of the Frauds and Limitations Act under consideration are Sections 2, 3 and 4 which we set out below.

2.	Creation, etc., of interest in land.

(1)	Subject to Subsection (2) and Section 5—
(a)	no interest in land can be created or disposed of except—
(i)	by writing signed—
(a)	by the person creating or disposing of the interest; or
(b)	by that person's agent lawfully authorized in writing for the purpose; or
(ii)	by operation of law; or
(iii)	by will; and
(b)	a declaration of trust respecting any land or interest in land must be manifested and proved—
(i)	by some writing signed by a person lawfully able to declare such trust; or
(ii)	by that person's will; and
(c)	a disposition of an equitable interest or trust subsisting at the time of the disposition must be—
(i)	in writing signed—
(a)	by the person disposing of the equitable interest or the trust; or
(b)	by that person's agent lawfully authorized in writing for the purpose; or
(ii)	by will.
(2)	Nothing contained in Subsection (1) shall be construed as affecting the creation or operation of resulting, implied or constructive trusts, and that subsection shall be read and construed accordingly.

3.	Effect where interest in land created by parol.

(1)	Subject to Subsection (2) and Section 5, where—
(a)	an interest in land is created by parol; and
(b)	the creation of that interest is not in accordance with Section 2(1)(a)(i),
that interest shall, notwithstanding any consideration having been given in respect of it, have the force and effect of an interest at will only.
(2)	Nothing contained in Subsection (1) shall be construed as affecting the creation, by parol, of a lease that—
(a)	takes effect in possession for a term not exceeding three years; and
(b)	is at the best rent that can reasonably be obtained without taking a fine,
and that subsection shall be read and construed accordingly.

4.	Contracts for the sale of land, etc.

No action shall be brought upon a contract for the sale or other disposition of land or an interest in land unless the contract, or some note or memorandum of the contract, upon which the action is brought is in writing signed—

(a)	by the person against whom the action is brought; or
(b)	by an agent of that person lawfully authorized in writing for the purpose.

56.	The term “interest in land” is defined in Section 3 of the Interpretation Act and it: 

“means a proprietary right, title or estate, whether corporeal or incorporeal, and whether legal or equitable, in or in respect of land (other than customary land), and includes a right appurtenant or appendant to any such right, title or estate.”

57.	An action to enforce an oral agreement to transfer legal title in a property from the registered proprietor to another person is not possible in the absence of an agreement in writing via a written contract or note or memorandum of the contract as is required by Sections 2 and 4 of the Frauds and Limitations Act:   Leontine Ofoi v Kris Bongare (2007) N3248. Hence, in the absence of a contract for sale of land or some note or memorandum of the contract, no action lies upon an oral agreement to transfer land:  Active Auto Parts (PNG) Pty Ltd v Brian Hull (1990) N833, Jacobs v Kwaindu [1991] PNGLR 366, Pamela Ipi Pangu v Ian Ellery (2007) N3227, Leontine Ofoi v Kris Bongare (2007) N3248, Sonny Atua v Grace Kemmah (2011) N4296.  In other words, where there is an oral agreement, in our view, the effect of non-compliance with Section 4 is not to invalidate the agreement, but merely to prevent a party from instituting an action based on the oral agreement. The oral agreement in that context would be valid, but unenforceable by action.

58.	In addition, if one believes that there is an oral contract, then the terms should be regularized in a written contract or some written note or memorandum of the contract in order for the contract to be enforceable by action.

59.	As to the First Appellants’ argument that Section 3(1) of the Frauds and Limitations Act allows for the creation of an interest in land by parol and such an interest will have the force and effect of an interest at will only notwithstanding any consideration having been given in respect of the interest, with respect, we agree.   However, except that such an interest has the force and effect of an interest at will, the Frauds and Limitations Act provides little assistance as to which interest in land created by parol fall under Section 3 of the Frauds and Limitations Act.  We would think that since the provision uses the term, “interest in land”, which is defined under Section 3 of the Interpretation Act, without any qualification, a literal interpretation of the term should be applied and that means that all those interests in land mentioned under Section 3 of the Interpretation Act are covered to create an interest in land by parol.  The term "interest in land" “means a proprietary right, title or estate, whether corporeal or incorporeal, and whether legal or equitable, in or in respect of land (other than customary land), and includes a right appurtenant or appendant to any such right, title or estate.”  

60.	In this regard, we agree with the Respondent’s argument that there was no room to consider Section 3 of the Frauds and Limitations Act as the primary judge found on the available evidence before her that it was contrary to the present law and the respondent did not authorize the change of name on the title and the subsequent transactions to transfer his interest in the Property to the First Appellants.  In the present case, there was essentially no cogent or convincing evidence before the Court of the existence of any oral agreement between the First Appellants and the Respondent to even consider the application of Section 3.

61.	We have also considered that Section 3 might run counter to Sections 2 and 4 of the Frauds and Limitations Act and cause confusion.  In that regard, we note that it is a principle of statutory interpretation in deciding which law to apply in the event of an inconsistency of provisions in a statute that the later section prevails over the earlier section:  Donald Gifford, Statutory Interpretation, The Law Book Company Limited, 1990, 112-113.  In the present case, Section 4 prevails over Section 3 in respect of the requirement for the sale of land or disposition of an interest in land.  

62.	We have also considered Section 5 of the Frauds and Limitations Act given Section 3 is made subject to Section 5.  We think that the circumstances of the present case do not support the First Appellants’ submission that they acquired the interest in the Property pursuant to Section 5(c) by virtue of possession. The First Appellants who are the Respondent’s wife in the case of Lina Peyape and his children in the case of Amos and Jumbo Peyape on the evidence were living on the Property with the consent and the approval of the Respondent, tacit or otherwise.  They are not squatters to seek possessory title by the principle of adverse possession.  

63.	We are therefore of the view that Grounds 6 and 7 have no merit and must be dismissed.
 
Failure to comply with statutory requirements for transfer of interest in land (Ground 8)

64.	Ignorance of the law based on illiteracy or otherwise does not afford any excuse for not complying with statutory requirements.  The issue raised by this ground was not even raised by the First Appellants in the National Court and therefore they are precluded from raising it on appeal: Rimbunan Hijau (PNG) Ltd v Enei (2017) SC1605.  This ground has no merit and is dismissed. 

65.	In addition or alternatively, grounds of appeal must be clear, unambiguous and succinct.  There are three appellants who are joined and referred to in this appeal as the First Appellants.  This ground only refers to the “First Appellant”.  Who is the First Appellant?  It is not certain who that person, among the three First Appellants, is.  This ground is not clear and ambiguous and therefore is dismissed on that basis as well.

Transfer of interest in the Property a family matter (Ground 9)

66.	The only person with any primary legal interest to be protected is the Respondent.   It is his interest that he sought to be protected and restored as against his wife and two children when he commenced his action in the National Court.   Like any equitable remedy, the long-established maxim that equity follows the law when applied to the facts of this case, the overall interest of justice must be considered in favour of the registered proprietor whose legal right was blatantly impinged by the dishonest or fraudulent actions of the First Appellants to transfer his interest in the land in the Property to themselves.
67.	In any event, the issue raised by this ground was not raised by the First Appellants in the National Court and therefore they are precluded from raising it on appeal:  Rimbunan Hijau (PNG) Ltd v Enei (2017) SC1605.  Hence, the First Appellants’ argument grounded on constructive trust and Sections 2(2) and 5 of the Frauds and Limitations Act have no merit and is rejected.  
  
68.	This ground has no merit and is dismissed.

CONCLUSION

69.	Of all the nine grounds of appeal pleaded in the Notice of Appeal, except for Ground 5, all other grounds of appeal have been considered in favour of the Respondent as having no merit and have been dismissed.   The ultimate decision and orders of the National Court of 24 August 2018 as to the setting aside of the registration on the title of the Property in the First Appellants’ names and the restoration of the title in the Respondent’s name for constructive fraud however are not substantively affected by the ground that has been upheld which we consider has no bearing at all on the final outcome of the appeal and therefore the orders of the National Court will be affirmed.

ORDER

70.	The orders of the Court are:

1.	The appeal is partly upheld on the basis of one successful ground out of the nine grounds of appeal pleaded in the Notice of Appeal filed on 3 September 2018.

2.	Except for Ground 5 of the appeal, all other grounds of appeal from Grounds 1, 2, 3, 4, 6, 7, 8 and 9 have been considered in favour of the Respondent as having no merit and are dismissed.

3.	The ultimate decision and orders of the National Court of 24 August 2018 as to the setting aside of the registration on the title of Allotment 30 Section 117, State Lease Volume 21 Folio 128 Hohola (Erima), National Capital District in the First Appellants’ names and the restoration of the title in the Respondent’s name for constructive fraud are not substantively affected by the ground that has been upheld and therefore the orders of the National Court are affirmed.

4.	The First Appellants shall bear the costs of and incidental to the appeal which, if not agreed, shall be taxed.
____________________________________________________________
Harry Lawyers:  Lawyers for the First Appellants			
Solicitor-General: Lawyers for the Second & Third Appellants
Awalua & Associates: Lawyers for the Respondent