Re alleged improper borrowing of AUD1.239 Billion Loan

• Jurisdiction: Papua New Guinea
• Judge: Salika DCJ, Mogish J, Cannings J, Kassman J, Higgins J
• Judgment Date: 16 December 2016
• Citation: (2016) SC1556
• Court: Supreme Court
• Year: 2016
• Judgement Number: SC1556

Full : SC REF NO 5 OF 2016; Reference Pursuant to Constitution, Section 18(2), Re alleged improper borrowing of Aud1.239 Billion Loan; Ombudsman Commission and Rigo Lua and Phoebe Sangetari and The Honourable Peter O’Neill MP, Prime Minister and The Honourable Ano Pala MP, Attorney-General (2016) SC1556

Supreme Court: Salika DCJ, Mogish J, Cannings J, Kassman J, Higgins J

Judgment Delivered: 16 December 2016

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...