The Independent State of Papua New Guinea and Sam Akoita, Minister for Mines and Tolukuma Gold Mines Limited v Central Provincial Government (2009) SC977

• Jurisdiction: Papua New Guinea
• Judge: Sakora, Manuhu & Hartshorn JJ
• Judgment Date: 15 June 2009
• Citation: (2009) SC977
• Docket Number: SCA 99 &100 OF 2005
• Court: Supreme Court
• Year: 2009
• Judgement Number: SC977

Full Title: SCA 99 &100 OF 2005; The Independent State of Papua New Guinea and Sam Akoita, Minister for Mines and Tolukuma Gold Mines Limited v Central Provincial Government (2009) SC977

Supreme Court: Sakora, Manuhu & Hartshorn JJ

Judgment Delivered: 15 June 2009

SC977

PAPUA NEW GUINEA

[IN THE SUPREME COURT OF JUSTICE]

SCA 99 &100 OF 2005

BETWEEN:

THE INDEPENDENT STATE OF PAPUA NEW GUINEA

First Appellant

AND:

SAM AKOITA, MINISTER FOR MINES

Second Appellant

AND:

TOLUKUMA GOLD MINES LIMITED

Third Appellant

AND:

CENTRAL PROVINCIAL GOVERNMENT

Respondent

Waigani: Sakora, Manuhu & Hartshorn JJ.

2008: 3rd July,

2009: 15th June

APPEAL - Appeal against refusal to dismiss Originating Summons as an abuse of process – whether trial judge erred in his determination of whether correct procedure used in claiming relief sought – application for declaratory orders – factors necessary for relief to be sought – no competing rights or controversy between parties – abuse of process - appeal upheld

Facts:

Tolukuma Gold Mines Ltd operates a mine in the Central Province and was granted an extension of the term of its mining lease. The Central Provincial Government (CPG) sought declaratory relief in the National Court that the extension was unconstitutional, unlawful and null and void. Tolukuma applied unsuccessfully to dismiss the National Court proceeding as being incompetent and an abuse of process. Tolukuma, the State and the Minister for Mines appeal that decision refusing to dismiss.

Held:

1. There is no requirement for the Central Provincial Government to be consulted before the term of a mining lease is extended. There are no competing rights or controversy between the parties and declaratory relief should not have been sought.

2. CPG’s cause of action is incontestably bad and an abuse of process.

3. The trial judge fell into error when he exercised his discretion and refused to dismiss the proceeding as an abuse of process under Order 12 Rule 40(1)(c) National Court Rules.

4. The appeal is upheld and the whole of the interlocutory judgment of the National Court of 3rd August 2005 is set aside.

Cases cited:

Papua New Guinea cases:

Donigi v. The State [1991] PNGLR 376

Curtain Bros (PNG) Ltd v. UPNG (2005) SC788

Ok Tedi Mining Ltd v. Niugini Insurance Corporation & Others (No.2) [1988-89] PNGLR 425

Overseas Cases:

Ainsworth v. Criminal Justice Commission (1991-1992) 175 CLR 564

Mentha & Ors v. GE Capital Ltd & Anor (1997) 154 ALR 565

Russian Commercial and Industrial Bank v. British Bank for Foreign Trade Ltd [1921] 2 AC 438

Counsel:

Mr. G. Poole, for the Third Appellant

Mr. A. Jerewai and Mr. S. Tolo, for the Respondent

15 June, 2009

1. BY THE COURT: Tolukuma Gold Mines Ltd operates a mine in the Central Province and was granted an extension of the term of its mining lease. The Central Provincial Government (CPG) sought declaratory relief in the National Court that the extension was unconstitutional, unlawful and null and void. Tolukuma applied unsuccessfully to dismiss the National Court proceeding as being incompetent and an abuse of process. Tolukuma, the State and the Minister for Mines appeal that decision refusing to dismiss. Leave to appeal was granted by consent.

2. At the hearing of the appeal there was no appearance on behalf of the State and the Minister for Mines. The appeal proceeded in their absence as we were satisfied that they were sufficiently aware that the appeal was to proceed before us.

3. Tolukuma submitted that the trial judge erred in law and fact in not dismissing the Originating Summons of CPG as amongst others:

a) CPG had not used the correct mode of procedure by claiming the declaratory relief that it has,

b) the Minister for Mines was not required to consult CPG before making his decision to grant an extension of the mining lease,

c) the Minister had taken into account the considerations required of him by the Mining Act 1992 in deciding whether to grant an extension.

4. CPG takes issue with the submissions of Tolukuma and submits that the trial judge did not err in law and fact as:

a) the correct procedure was used as CPG has the right to be consulted on whether an extension of the mining lease should be granted,

b) the issue whether CPG should have been consulted on an extension to the mining lease was substantive and should be considered at trial.

Issues

5. From the above the issues are, did the trial judge fall into error in his determination of whether:

a) CPG has used the correct procedure in claiming the relief that it has,

b) the issue concerning CPG's consultation could only be considered at a substantive hearing.

6. The decision of the trial judge that is the subject of this appeal was an exercise by him of judicial discretion in considering an application under Order 12 Rule 40(1)(c) National Court Rules. This Court’s role in an appeal from such a decision is considered in Curtain Bros (PNG) Ltd v. UPNG (2005) SC788. We agree with and respectfully reproduce the following passage from that decision:

“The appellant Court will not interfere with a discretionary judgment on a procedural matter within its jurisdiction, except where the exercise of that discretion is clearly wrong. A discretionary judgment may be set aside if an identifiable error occurred in the exercise of discretion. Alternatively, it may be set aside where there is no identifiable error, but the resulting judgment or order is “unreasonable or plainly unjust” and such that an error can be inferred. These principles are well established. We adopt a passage from Kitto J in the Australian High Court case of Australia Coal and Shale Employees’ Union v The Commonwealth (1956) 94 C.L.R. 621 at p.627, which was adopted by Clarkson J. in Breckwoldt & Co. (N.G.) Pty Ltd v. Gnoyke [1974] PNGLR 106 at p.112 – 113:

“The decision by the primary judge to stay the action was made in exercise of a judicial discretion and I accept that in those circumstances the principles on which this Court should act are as described by Kitto J. in Australian Coal and Shale Employees’ Union v The Commonwealth ... the true principle limiting the manner in which appellate jurisdiction is exercised in respect of decisions involving discretionary judgements is that there is a strong presumption in favour of the correctness of the decisions appealed from, and that that decision should therefore be affirmed unless the court of appeal is satisfied that it is clearly wrong. A degree of satisfaction to overcome the strength of the presumption may exist where there has been an error which consists in acting upon a wrong principle, or giving weight to extraneous or irrelevant matters, or failing to give weight or sufficient weight to relevant considerations, or making a mistake as to the facts. Again, the nature of the error may not be discoverable, but even so it is sufficient that the result is so unreasonable or plainly unjust that the appellate court may infer that there has been a failure properly to exercise the discretion which the law reposes in the court of first instance…”

Whether correct procedure used

7. Counsel for CPG submitted that Tolukuma raised this issue before the trial judge but did not pursue it. It is clear from a perusal of the transcript that the issue was raised by counsel for Tolukuma. There is no indication that the issue was not pursued. We are of the view that nothing turns on this point.

8. CPG commenced the National Court proceeding by Originating Summons seeking a declaration that the decision of the Minister for Mines was amongst others null and void. Other relief sought included orders that Tolukuma cease operating in the mining lease area and that no further extension of the mining lease be granted without CPG being consulted.

9. CPG submits that as it has a right to be consulted under s.115 Organic Law on Provincial and Local Level Governments and s. 255 Constitution, it is able to seek declaratory orders under Order 4 National Court Rules and consequential relief.

10. Reliance is placed upon the National Court decision of Ok Tedi Mining Ltd v. Niugini Insurance Corporation & Others (No.2) [1988-89] PNGLR 425 where Kapi DCJ (as he then was) said:

“I am of the opinion that an objection may now be made to a mere declaratory order on the basis that he does not seek any consequential relief.”

CPG submits that as it has a right to be consulted and is seeking declaratory and consequential relief, no objection can be taken to the procedure used.

11. Tolukuma submits that although the granting of declaratory orders is discretionary, the discretion to grant such orders is only to be exercised where there is a clear case of competing rights between the parties. Reliance is also placed upon the Ok Tedi case (supra) in which reference was made to the factors that are required to be established before a declaratory order can be made. These are set out in the celebrated case of Russian Commercial and Industrial Bank v. British Bank for Foreign Trade Ltd [1921] 2 AC 438 at 448. They are:

1) There must exist a controversy between the parties.

2) The proceedings must involve a right.

3) The proceedings must be brought by a person who has a proper or tangible interest in obtaining the order.

4) The controversy must be subject to the court's jurisdiction.

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