Certified Practising Accountants Papua New Guinea (Formerly known as Papua New Guinea Institute of Accountants), Accountants Registration Board, Rex Paki (Liquidator) and Thomas Laka (Auditor) v Institute of Chartered Management Accountants ("ICMA") and The Independent State of Papua New Guiena (2005) N2882

• Jurisdiction: Papua New Guinea
• Judge: Davani J
• Judgment Date: 08 August 2005
• Court: National Court
• Citation: (2005) N2882
• Year: 2005
• Judgement Number: N2882

Full Title: Certified Practising Accountants Papua New Guinea (Formerly known as Papua New Guinea Institute of Accountants), Accountants Registration Board, Rex Paki (Liquidator) and Thomas Laka (Auditor) v Institute of Chartered Management Accountants ("ICMA") and The Independent State of Papua New Guiena (2005) N2882

National Court: Davani J

Judgment Delivered: 8 August 2005

N2882

IN THE NATIONAL COURT OF JUSTICE

AT WAIGANI

PAPUA NEW GUINEA

OS 189 OF 2005

BETWEEN:

CERTIFIED PRACTISING ACCOUNTANTS PAPUA NEW GUINEA (formerly known as Papua New Guinea Institute of Accountants)

First Plaintiff

AND:

ACCOUNTANTS REGISTRATION BOARD

Second Plaintiff

AND:

REX PAKI (LIQUIDATOR)

Third Plaintiff

AND:

THOMAS LAKA (AUDITOR)

Fourth Plaintiff

AND:

INSTITUTE OF CHARTERED MANAGEMENT ACCOUNTANTS (“ICMA”)

First Defendant

AND:

THE INDEPENDENT STATE OF PAPUA NEW GUINEA

Second Defendant

Waigani : Davani, J

2005 : 25 May

8 August

Constitutional Law – Constitution of the Independent State of Papua New Guinea – Interpretation and application of – legislation to be declared unlawful – when National Court may determine – Constitution s. 18 (1) (2); s. 19 (1)

Constitutional Law – Enacted legislation – Interpretation and application of – not a prohibited or restricted act – National Court – no jurisdiction – Constitution ss. 23 (2); 41 (1) (a) (b) (c).

Counsel

R. Pato for the plaintiffs

L.Makap for the defendants

DECISION

8th August 2005

DAVANI, J: There are two applications by Notice of Motion brought by the plaintiffs and the defendants. They arise out of proceedings commenced by the plaintiff seeking relief relying on s. 41 of the Constitution.

The parties interested in this application and who are named in the proceedings are parties who are affected by the gazettal and certification of the Act. The role they play in the accounting profession and their interests in the proceedings is set out below;

1(a) The first plaintiff is or otherwise consists of the whole of the membership of the certified Practising Accountants of Papua New Guinea and represented in this proceedings by its Acting President, Mr Pokawin who has filed an affidavit.

1(b) The second plaintiff is the Controlling Board of the first plaintiff which inter alia is empowered to review the activities of the members of the first plaintiff, set appropriate professional and ethical standards, discipline its members where appropriate, determine qualifications acceptable for admission to membership of the Certified Practising Accountants PNG, etc.

1(c) The third and fourth plaintiffs are individual Accountants currently in private practice and are registered members of the Certified Practising Accountants of Papua New Guinea (formerly) the Papua New Guinea Institute of Accountants.

1(d) The first defendant is the body whose functions are the same as or equivalent to the second plaintiff under the Management Accountants Act 2004.

1(e) The second defendant is the Independent State of Papua New Guinea and was responsible through its Minister, the Treasurer, for introducing the Management Accountants Act 2004 which was passed by Parliament on 24th November, 2004.

Applications

The motion filed by Paraka Lawyers on 10th May, 2005, seeks the following orders;

“1. The entire proceedings be dismissed for being incompetent in that the proceedings involves the issue of the Constitutional validity of an Act of Parliament, which is the sole function of the Supreme Court pursuant to section 18 and 19 of the Constitution, and therefore the National Court lacks jurisdiction.

2. Alternatively the entire proceedings be dismissed pursuant to O. 12 R. 40 of the National Court Rules for disclosing no cause of action, frivolous, vexatious and an abuse of process.

3. Costs of the proceedings.”

The plaintiffs Notice of Motion filed by Steeles Lawyers on 14th April, 2005, seeks the following orders;

“1. That pursuant to the Courts inherent jurisdiction under section 155 (4) of the Constitution, the Management Accountants Registration Board be restrained from causing to register and/or requiring any person to register, under the Management Accountants Act 2004, (‘the Act’) pending the determination of this Constitution section 41 action.

2. That until further orders and or pending the determination of this action, no provisions of the Act, are to be given effect, enforced, implemented, or applied in any manner whatsoever by the Management Accountants Registration Board, Management Accountants Statutory Committee, Institute of Chartered Management Accountants and any other bodies created by the Act, or any person under their direction, control or power, whether individual or corporate.

3. That pending the determination of this action, the provisions of the Accountants Act 1996 (as amended to date) is applicable for purposes and objectives intended to be achieved by this Act, particularly in respect of registration of Accountants in Employment, and shall remain in full force and effect and shall not be derogated from, interfered with or otherwise affected in it’s application or operations.

4. Costs be costs in the cause.

…”

It is necessary that I set out the substantive relief sought by the plaintiffs. This is contained in Originating Summons filed by Steeles Lawyers on 13th April, 2005, and which states;

“The plaintiff claims;

1. A declaration that the certification, gazettal and other actions of and or pertaining to giving legal and practical effect to the Legislation known as Management Accountants Act 2004, passed by the National Parliament on 24th November 2004, certified by the Speaker of the National Parliament on the 1st March 2005 and gazetted by publication No. G28 in the National Gazette on the 3rd March 2005, are;

(a) harsh and/or oppressive in the circumstances and therefore are unlawful acts within the meaning of section 41 (1) (a) of the Constitution of Papua New Guinea (‘the Constitution’).

(a) not warranted by, or are disproportionate to the requirements of the particular circumstances or of the particular case and therefore are unlawful acts within the meaning of section 41 (1) (b) of the Constitution.

(a) Otherwise not, in the particular circumstances, reasonably justifiable in a democratic society having a proper regard to the rights and dignity of mankind and therefore are unlawful acts within the meaning of section 41 (1) (c) of the Constitution.”

The respective motions filed by the parties are supported by the following affidavits;

· Affidavit of Peter Pokawin, sworn on 13th April, 2005 and filed on 14th April, 2005, by Steeles Lawyers, for and on behalf of the plaintiffs;

· Affidavit of Thomas Aka, sworn and filed on 15th April, 2005, by Steeles Lawyers, for and on behalf of the plaintiffs;

· Affidavit of Guguna Garo, sworn and filed on 10th May, 2005, by Paul Paraka Lawyers, for and on behalf of the defendants.”

Issues

The main issue raised by the court proceedings filed, now before me and which is the subject of contention by the Notices of Motions filed by plaintiffs and defendants, is;

- whether or not the National Court has jurisdiction to determine these proceedings because the proceedings may raise constitutional issues in relation to the validity of an act of Parliament and which will involve the interpretation or application of the Management Accountants Act 2004, when such issues regarding the interpretation or application of any constitutional law falls within the original jurisdiction of the Supreme Court by virtue of ss. 18 and 19 of the Constitution.

The defendants raise another issue in relation to the application under O. 12 R. 40 of the National Court Rules, being that the proceedings do not disclose a cause of action and should be dismissed because it seeks to nullify or declare as unconstitutional, what is otherwise a lawful action of the National Parliament or Legislature in passing, certifying and gazetting an act of Parliament through a lawful process.

I deal with these issues in my reasons.

I set out below ss. 18 and 19 of the Constitution.

S. 18 reads;

“(1) Subject to this Constitution, the Supreme Court has original jurisdiction, to the exclusion of other courts, as to any question relating to the interpretation or application of any provision of a Constitutional Law.

(2) Subject to this Constitution, where...