Arnold Ningiga v Peter Lare Koavea [1988–89] PNGLR 312

• Jurisdiction: Papua New Guinea
• Citation: [1988–89] PNGLR 312
• Date: 11 August 1989
• Court: National Court
• Year: 1989

Full Title: Arnold Ningiga v Peter Lare Koavea [1988–89] PNGLR 312

National Court: Los J

Judgment Delivered: 11 August 1989

1 Real property—lease and option to buy—contract of sale—failure to complete—specific performance

REAL PROPERTY—Approval of certain dealings—Transfer of land—Of no effect until ministerial approval obtained—Contract voluntarily entered into—No statutory protection until steps taken to obtain approval—Specific performance required—Land Act (Ch185), s69.

VENDOR AND PURCHASER—Contract for sale of land—Ministerial approval required to transfer—Transfer not effective until approval obtained—Contract otherwise enforceable—No statutory protection until steps taken to obtain approval—Specific performance required—Land Act (Ch185), s69.

VENDOR AND PURCHASER—Contract for sale of land—Option to purchase in lease exercised—Improvements effected—Improvements made not subject to covenants in lease—Change in relationship of parties.

The Land Act (Ch185), s69, provides that land shall not be transferred without the approval of the Minister.

Parties entered into a memorandum of lease which included a covenant by the tenant not to effect improvements without the consent of the landlord and an option to purchase the property leased, which option was exercised and a contract of sale executed. After the contract was executed, the purchaser effected considerable improvements to the property. The vendor refused to complete and the purchaser sought specific performance.

Held:

(1) Where parties have voluntarily entered into a contract for the sale of land, the party who is charged with the obligation to obtain the approval of the Minister under s69 of the Land Act, cannot rely on s69 as rendering the transaction ineffective until he has taken the necessary steps to obtain that approval.

McCosker and King v Kuster [1967–68] PNGLR 182 and Re Luabar Logging Pty Ltd [1988] PNGLR 124, applied.

(2) Because the relationship of landlord and tenant changed to that of vendor and purchaser on the exercise of the option to purchase, improvements effected to the property thereafter were not subject to the covenant in the lease not to effect improvements without consent.

(3) In the circumstances, the vendor should be ordered to take all necessary steps, within one month, to obtain approval under s69 of the Land Act to transfer the title of the property.

Cases Cited

The following cases are cited in the judgment:

McCosker and King v Kuster [1967–68] PNGLR 182

Re Luabar Logging Pty Ltd [1988] PNGLR 124.

Summons for specific performance

These were proceedings in which the purchaser under a contract for the sale of land sought specific performance thereof.

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Los J: By a writ of summons the plaintiff seeks to have the defendant comply with an agreement allegedly entered into between them over a property described as Allotment 16, Section 54, Boroko. The plaintiff says that through the Boiboi Real Estate agency he found a...