PNG National Stevedores Pty Ltd v The Honourable Andrew Baing; PNG Harbours Board v PNG National Stevedores Pty Ltd

• Jurisdiction: Papua New Guinea
• Citation: (1998) N1705
• Date: 09 April 1998
• Court: National Court
• Year: 1998

Full Name: PNG National Stevedores Pty Ltd and Bank of South Pacific Ltd v The Honourable Andrew Baing, PNG Harbours Board and The Independent State of Papua New Guinea; PNG Harbours Board v PNG National Stevedores Pty Ltd (1998) N1705

National Court: Kapi DCJ

Judgment Delivered: 9 April 1998

1 Practice and procedure—Application to set aside judgment—proper principles considered

2 Application under O12 r8(2)(b) of the National Court Rules

3 Application under O1 r8 of the National Court Rules—Application within a reasonable time—O1 r9 of the National Court Rules

4 Permanent Trustee Co (Canberra) Ltd v Stocks & Holdings (Canberra) Pty Ltd (1976) 28 FLR 195, Autodesk Inc v Dyason [No 2] (1993) 176 CLR 300, Richard Dennis Wallbank and Jeannette Minifie v The Independent State of Papua New Guinea [1994] PNGLR 78, Application of Wili Kili Goiya SC408 and TST Holdings Pty Ltd v Tom Pelis (1997) SC534 referred to

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Kapi DCJ: This is an application to set aside a judgment entered on 19 September 1996. It is necessary to set out the background to this application.

The first plaintiff commenced proceedings against the defendants for a mandatory injunction requiring the defendants to take necessary steps to repeal Statutory Instrument No 2 of 1994 and in the alternative, for general damages.

The amended statement of claim pleads the following facts which are alleged to constitute the cause of action. In 1994 the second defendant amended s192 of Harbours Board (General) (Amendment) By–Law (Ch240) by Statutory Instrument No 1 of 1994. The effect of this amendment was that a person may not carry on the business of stevedore within the boundaries of a declared port unless he is a holder of a licence. An application for such a licence:

"shall, subject to any agreement between the board and a person that applies, be made only by a person in the sense of a company that is 100% beneficially owned directly or indirectly by a citizen, but not by any such company in which the control exercisable in law or by any agreement between the company and a third part, or in practice, is maintained by a person other than a citizen."

The effect of this law, it is alleged, was to enable citizen–owned stevedore companies to operate free from foreign–owned stevedore companies.

The first plaintiff was incorporated as a 100% citizen–owned company for purposes of carrying out stevedoring operations in the ports of Port Moresby and Lae. The first plaintiff applied and was granted a licence on or about 1 July 1994.

It is alleged that upon the granting of the licence, the first plaintiff proceeded at substantial expense to make elaborate preparations for commencing stevedoring operations in Port Moresby and Lae. The first plaintiff alleges that these preparations were taken out in reliance of the By–Law which provide, in particular, that the operations would be free of foreign competition.

In January 1995 the first defendant announced his intention to change the policy set out in Statutory Instrument No 1 of 1994. In accordance with the change in policy, the second defendant repealed s192 of Harbours Board (General) By–Law (Ch240) by Statutory Instrument No 2 of 1994. The new amendment relevantly provides that:

" . . . With effect from 1st January 1996 an application for a licence–

(a) shall be made only by a company in which Papua New Guineans hold not less than 51% of the share capital. In order to ensure that there is a smooth transition period, application for licence can be made by companies which do not fulfil the immediately preceding [sic] requirement between the period 1/1/95 and 31/1/95 inclusive."

The first plaintiff alleges that the effect of this amendment was to cancel the closing of stevedoring operations in Papua New Guinea ports to foreign–owned companies.

The first plaintiff further alleges that by reason of the Statutory Instrument No 1 of 1994 and the granting of licence to the first plaintiff pursuant to the provisions of the said Statutory Instrument, the defendants are estopped from changing that policy and subsequent repeal of the said Statutory Instrument. This is the basis for the claim for mandatory injunction.

In the alternative, the first plaintiff alleges that the change in policy and the subsequent adoption of the policy in Statutory Instrument No 2 of 1994 has prevented it from commencing stevedoring operations in Port Moresby and Lae. The first plaintiff alleges that this is unconscionable conduct and therefore it is entitled to damages.

The first and third defendants filed a defence. The second defendant was represented by different lawyers and it filed a defence as well. It is not necessary for...