Investment Corporation of Papua New Guinea v Paul Pora, Minister for Finance and Physical Planning and The Independent State of Papua New Guinea

• Jurisdiction: Papua New Guinea
• Citation: [1993] PNGLR 45
• Date: 04 October 1991
• Court: National Court
• Year: 1993

National Court: Brown J

Judgment Delivered: 4 October 1991

1 Statute—Stamp Duties Act (Ch114)—company title dwelling—transfer of shares and registered subleases—purchase of share capital—share sale agreement nominated principal instrument for stamp duty assessment—transfer of shares stamped with ad valorem duty—agreement for sale assessed for duty under s46 Stamp Duties Act at 50% of total consideration—whether duty is assessed on total consideration for transfer of shares as real property or as transfers of marketable securities

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Brown J: The applicant is a company which purchased the share capital of another company called Sunset Apartments Pty Ltd. This latter company was the registered proprietor of land comprised in at State Lease Volume 1 Folio 126 Port Road Granville West Port Moresby upon which had been erected fifteen residential apartments, or units. These units were known as "Sunset Apartments". The articles of association of Sunset Apartments Pty Ltd provided that ownership of particular shares entitled the owner to exclusive use of a particular unit in the building with a right to sublease. "Sunset Apartments" may in common parliance be called a "company title dwelling". There is no strata title ownership provided for by legislation in Papua New Guinea, and apart from joint ownership whether as tenants in common or joint tenants, company title affords the principle method for ownership of such high rise or unit blocks.

The applicant on the 8 November 1988 executed contracts with various vendors to purchase the whole of the share capital of Sunset Apartments Pty Ltd. Pursuant to that contract appropriate transfers of shares and transfers of registered subleases were also signed. The Share sale agreement was nominated as the principal instrument for Stamp Duty purposes, and on the 15 November 1988 under hand of N Bogan the Local Assessor of Stamp Duties an assessment of stamp duty issued. The transfers were stamped with ad valorem duty and the agreement for sale was assesed for duty pursuant to s46 of the Stamp Duties Act (Ch114) at the rate of 5% of the total consideration in the sum of K102,286.20. This amount was paid under protest. The agreement for sale was completed on the 1 December 1988 and on the 11 January 1989, the applicant through its lawyer, by letter advised the Minister for Finance and Planning (the Minister responsible for Administration of the Act) of the applicants intention to appeal against the assesment and sought that he state a case setting out the basis of the assessment for duty for this Courts consideration and determination.

The applicant by originating summons filed on the 13 January 1989, claimed against the first respondent, the Honourable the Minister Paul Pora, an order quashing such assessment and that assessment of duty on the share transfer documents calculated in accordance with Div 9, Item 16 of the Schedule to the Act, (dealing with transfers of marketable...