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Lapiso v Lafana [1999] PNGLR 76 (27 January 1999)

[1999] PNGLR 76

PAPUA NEW GUINEA

[NATIONAL COURT OF JUSTICE]

HIMONI TOM LAPISO & BEN NOEL

V

DAMSON LAFANA;
EDWARD TITIE;
JULIE SOSO AKEKE; AND
EASTERN HIGHLANDS PROVINCIAL GOVERNMENT

LAE: VAGI AJ
20, 27 January 1999

Facts

The petitioner plaintiff filed a notice of motion seeking interim orders to allow all liquor dealers and traders in the Eastern Highlands Province to continue with selling liquor until substantive issues alleged in the originating summons are properly tried. In the originating summons, they allege that the chief Liquor Licensing Commissioner and the Chairperson of the liquor Licensing Commission acted without authority in issuing the publishing of the ban on all categories of liquor licence.

Held

1. There is a case, where the evidence thus far supports a permanent injunction.
   
2. The balance of convenience is in the plaintiffs’ favour. Interim injunction granted.
   

Papua New Guinea cases cited

Markscal Limited & Robert Needhan v Mineral Resources Development Company Pty Limited [1996] PNGLR 419.

Mauga Logging Company Pty Ltd v South Pacific Oil Palm Limited [1977] PNGLR 80.
Public Employees Association of Papua New Guinea and Napoleon Buyawo Liosi v Public Services Commission [1988-89] PNGLR 585.

Other case cited

American Cyanamid Company v Ethicon [1972] AC 395.

Counsel

D Umba, for the plaintiffs.
N Tenige, for the first respondent.

27 January 1999

VAGI AJ. The joint plaintiffs Himoni Tom Lapiso and Ben Noel have filed an originating summons on 18th January 1999 and served on counsel for all four defendants. The originating summons on which this motion before me is based seeks interim order to allow all liquor dealers and traders in the Eastern Highlands Province to continue with selling of liquor until the substantive issues alleged in the originating summons are properly tried.

The following are what the plaintiffs alleged:

1. A declaration that the letter dated 7th January 1999 written by the Chief Liquor Licensing Commissioner Mr Edward Titie is contrary to s 1(i) of the Liquor Licensing (Amendment) Act 1982 thus the notice is null and void.
   
2. A declaration that the Eastern Highlands Gazette No. EH 01/99 dated 7th January 1999 is contrary to s 35(i)(b) of the Liquor Control (Amendment) Act 1982 thus the gazettal is null and void.
   
3. A declaration that the position of the chairperson of the Liquor Licensing Commission occupied by Julie Soso Akeke is contrary to s 3(2) of the Liquor Control Act of 1978.
   
4. A declaration that Julie Soso Akeke’s appointment to the position of the Liquor Licensing Commission by the first defendant is contrary to s 5(a) & (b) of the Liquor Control Act of 1978.
   
5. A declaration that the Gazette No. EH. 01/99 dated 7th January 1999 suspending the five categories of licence holders is against the spirit, purpose and objective of the Liquor Control Act and thus be null and void.
   
6. A declaration that the Eastern Highlands Executive Council decision No. 3 of 1998 made on 14th October 1998 to suspend liquor trading in the Province for three months be null and void.
   
7. An interim injunction allowing licensed liquor dealers and traders in the Eastern Highlands Province to continue to trade until substantive issues pending in Court are properly determined.
   

Listed in the letter, signed by the Chief Liquor Licensing Commission, Mr Edward Titie and again published in the Eastern Highlands Gazette a notice signed by Mrs Julie Akeke, the Chairperson of the Liquor Licensing Committee; both documents dated 7th January 1999, were the following categories of licence for suspension:

(a) Wholesalers and distributors;

(b) Bottle shops;

(c) Taverns;

(d) Public Bars; and

(e) Community Clubs

Also published in the same two documents were other categories of licences that were exempted from the suspensions.

The suspensions are for three months effective on Monday 1st February 1999. The joint plaintiffs in their respective affidavits, with a number of supporting annexures, show that they are holders of a number of licences in the five categories and such suspension generally will have adverse effects on their business.

Apparently the real question would obviously be whether by the force of the liquor laws currently in operation in the Eastern Highlands Province, can the Provincial Executive Council’s decision of 14th October 1998 suspending the five categories of licences and notified in the letter and gazette on 7th January 1999 be enforced legally against the holders of all such licences.

Mr Umba of counsel for the joint plaintiffs advances two arguments on points of law. First is whether the Chief Liquor Licensing Commissioner Mr Edward Titie in endorsing the Executive Council’s decision in the letter dated 7th January, 1999, and whether the Chairperson of the Province’s Liquor Licensing Committee Mrs Julie Soso Akeke, in publishing the notice of suspensions in the Provincial Gazette dated 7th January 1999 have acted in accordance with the provisions of the liquor laws.

Section 1(1) of the Liquor Licensing (Amendment) Act of 1982 amended s 35 (i)(a) & (b) of the Liquor Control Act of 1978, which in essence reads:

(f) "(1) Notwithstanding the provisions of the Act or the terms and conditions of any licence, the Minister may, by written notice delivered to a licensee, and for such period not exceeding three months as he specifies in the notice;
(g)

1. suspend the licensee’s licence; or
   
2. restrict the permitted Laws of licence; or
   

by notice in the Eastern Highlands Gazette, and for such period not exceeding three months, as he specified in the notice generally.

1. suspend any class of licence; or
   
2. restrict any class of licence; or restrict the permitted hours of any class of licence.
   

These provisions do not allow any person other than the Minister to publish in a written notice suspension of or restriction of the permitted hours of such licence or licences, and by notice in the Eastern Highlands Gazette specifies generally the suspension of or the restriction of the permitted hours of such licence or licences. Both Mr Titie and Mrs Julie Soso Akeke are not Ministers to perform the functions and responsibilities of the Minister and therefore, these are matters Mr Umba argues, that are to be tried in a substantive hearing.

The second point of law Mr Umba argues is the contravention of s 5 (6) of the Liquor Licensing Act by Mrs Julie Soso Akeke. The evidence suggests that Mrs Akeke owns the building at the Goroka Market. She leases out part of the building to Palpal Restaurant, which is, one of the licensed premises exempted in the notice signed by her. It is submitted that she benefits financially from the arrangement and by law, she cannot qualify as a member in the Commission.

Mr Tenige of counsel for the four defendants, on the other hand, raises two principles that the plaintiffs need to establish before the Court can grant them the interim injunction they seek. These principles have been discussed in a number of authorities in this jurisdiction.

In the Mauga Logging Company Pty Ltd v South Pacific Oil Palm Development [1977] PNGLR 80, the Public Employees Association of Papua New Guinea and Napoleon Buyawo Liosi v Public Services Commission [1988-89] PNGLR 585 and the Textbook Injunctions, A Practical Handbook by Burns are cited as authorities for the first principle which is:

"That the Court is not entitled to take any account of the balance of convenience unless it has first been satisfied if the case went to trial upon no other evidence than is before the Court at the hearing of the application, the plaintiff would be entitled to judgement for a permanent injunction in the same term as the interlocutory injunction sought." Her Honour Doherty J, also considered Mauga Logging Company Pty Ltd (supra) case of American Cyanamid Company v Ethicon Limited [1975] UKHL 1; (1975) AC 396 in Markscal Limited and Robert Needham v Mineral Resources Development Company Pty Ltd and Orogen Mineral Pty Ltd and the Independent State of Papua New Guinea and Charles Lepani [1996] PNGLR 419. Where she held: "the applicant must show there is a strong case which on the evidence presented would support permanent injunction." Also Kapi, Dep. CJ in the Public Employees Association of Papua New Guinea and Napoleon Bayawo Liosi (supra) held: "In an application for an injunction to be granted, the applicant must satisfy that there is serious question to be determined and the balance of convenience favours the grant of the injunction."

What appears to apply as a second principle is a balance of convenience, which Mr Tenige raises. From the handbook he cites. "The Court’s second enquiry is directed whether the inconvenience or injury which the plaintiff would be likely to suffer if an injunction were refused, outweighs or is outweighed by the injury which the defendant would suffer if an injunction was granted. The expression "balance of convenience" used is more widely but it includes that particular question." The Court must consider, as expanded on in American Cyanamid (supra), if a plaintiff succeeds will damages be an adequate remedy for the loss sustained between the application and trial. If so, no interlocutory injunction should normally be granted. Not only that but the question involves consideration of whether common law damages would be sufficient but also whether the defendant will be able to pay them.

I do not see it necessary to require the joint plaintiffs to undertake as to damages that would entitle the defendant adequate compensation if they fail.

There is evidence now before me, which shows that the suspension will adversely affect the plaintiffs’ various businesses. This evidence is substantially in the affidavit form. In the case of Mr Noel, he deposed that the Provincial Executive Council on 12th October 1998 granted him the distributor’s licence. However, two days later, on 14th October, the Executive Council at its meeting suspended all five categories of licences. He was not advised in advance of the suspension and consequently he spent K5000 in licence fee and further made commitment to his bankers for a loan of K170,000.00 to help set up his distribution facilities.

There was a suggestion by Mr Tenige that if the plaintiffs were aggrieved by the decision for suspension, they should resort to the appeal procedures under s 12 of the Liquor Control Act. In reading this provision, I find s 12 speaks of situation where the Liquor Licensing Commission issues licence applied for, or at its discretion refuses to issue licence applied for under s 10, the applicant can appeal against the decision. This is not a case here.

Counsel also raises public policy considerations as the basis for such suspension. What he fails to produce is any evidence as to what those public policy considerations were or are. Although the court may not enquire into the internal proceedings of the Provincial Government or its Executive Council, all it can do is to ensure that the people’s constitutional rights are always protected.

It appears from the authorities that the matters, which I have to have in mind, are, whether there is a serious question and the balance of convenience and whether damages between the application and the trial are an adequate remedy.

It is apparent to me that the suspension of licences, even only for three months period, would be very devastating, it would affect the rights to run and own business. It would also affect the repayment of loans to the banks and whatever owing to their creditors. I consider these burdens will accumulate over a period of time if the plaintiffs cannot carry on with their businesses in liquor. I consider that the balance of convenience applies, upon been satisfied on evidence that the plaintiffs would be entitled to judgement for a permanent injunction.

In the circumstances, I grant the order sought. That the joint plaintiffs and all such persons affected by the suspension notice to continue with their liquor related businesses until the trial at Goroka on the date and time are to be fixed at the next month’s call over in Goroka.

Lawyers for the plaintiffs: Acarufa Lawyers.
Lawyers for the defendants: Provincial Principal Legal Office.