Gabriel Yer, Secretary, Department of Finance and Leonard Louma, Acting Chief of Staff, Department of Prime Minister and The Independent State of Papua New Guinea and Maurice Sheehan, Chief Commissioner, Commission of Inquiry into Department of Finance v Peter Yama (2009) SC996

• Jurisdiction: Papua New Guinea
• Judge: Sakora J, Mogish J, Cannings J
• Judgment Date: 30 October 2009
• Citation: (2009) SC996
• Docket Number: SCA NO 53 OF 2008
• Court: Supreme Court
• Year: 2009
• Judgement Number: SC996

Full Title: SCA NO 53 OF 2008; Gabriel Yer, Secretary, Department of Finance and Leonard Louma, Acting Chief of Staff, Department of Prime Minister and The Independent State of Papua New Guinea and Maurice Sheehan, Chief Commissioner, Commission of Inquiry into Department of Finance v Peter Yama (2009) SC996

Supreme Court: Sakora J, Mogish J, Cannings J

Judgment Delivered: 30 October 2009

SC996

PAPUA NEW GUINEA

IN THE SUPREME COURT OF JUSTICE

SCA NO 53 OF 2008

GABRIEL YER,

SECRETARY, DEPARTMENT OF FINANCE

First Appellant

LEONARD LOUMA,

ACTING CHIEF OF STAFF, DEPARTMENT OF PRIME MINISTER

Second Appellant

THE INDEPENDENT STATE OF PAPUA NEW GUINEA

Third Appellant

MAURICE SHEEHAN, CHIEF COMMISSIONER,

COMMISSION OF INQUIRY INTO DEPARTMENT OF FINANCE

Fourth Appellant

V

PETER YAMA

Respondent

Waigani: Sakora J, Mogish J, Cannings J

2009: 4 September, 30 October

PRACTICE AND PROCEDURE – mode of commencement of proceedings – whether proceedings regarding enforcement of deed of release must be commenced by writ of summons or originating summons – whether motion seeking order in nature of mandamus must be brought under Order 16 of the National Court Rules.

PRACTICE AND PROCEDURE – requirements for service of notice of motion on parties against whom interlocutory orders are sought.

INJUNCTIONS – duty of National Court to set out considerations taken into account in deciding whether to grant injunction.

CLAIMS BY AND AGAINST THE STATE ACT – procedures for enforcement of judgments against the State.

PRACTICE AND PROCEDURE – circumstances in which a claim for substantive relief in interlocutory proceedings is an abuse of process.

The respondent commenced proceedings in the National Court by originating summons seeking an order that the Secretary for Finance comply with a deed of settlement between him and the State and pay him K15.5 million. The day after he filed the originating summons he sought and obtained by notice of motion from the National Court an order that the Secretary release and clear a cheque for K7.75 million that had earlier been given to him in part-payment of the claim and that all defendants were restrained from interfering and/or dealing with the release and clearance of the cheque for K7.75 million. The Secretary and other parties including the State appealed against that order on five grounds: (1) the proceedings were improperly commenced by originating summons; (2) the defendants were given insufficient notice of the motion; (3) the primary Judge failed to apply the principles about granting injunctions before making the order; (4) the provisions of the Claims By and Against the State Act regarding enforcement of judgments against the State were breached; and (5) the rules about not granting substantive relief by notice of motion were breached.

Held:

(1) The proceedings were not improperly commenced by originating summons.

(2) The Secretary, being a party against whom specific orders were sought, was entitled to three days notice of the motion; and the failure to give such notice could not be cured by a State lawyer saying that he appeared for the Secretary when clearly no proper opportunity had been given to him to consider the matter and give proper instructions. The primary Judge erred by not ensuring that the Secretary was given sufficient notice.

(3) The order of the National Court was in the nature of a permanent injunction and the primary Judge erred by not stating and applying the principles that must be considered when deciding whether to make such an order.

(4) No provisions of the Claims By and Against the State Act were breached and there was no error of law by the primary Judge in that regard.

(5) The relief sought by the notice of motion was substantive relief and it was contrary to the National Court Rules for it to be sought in that manner; and the primary Judge erred by failing to dismiss the motion for that reason.

(6) Three of the five grounds of appeal were upheld. The appeal was allowed, the order of the National Court quashed and the matter remitted to the National Court.

Cases cited

The following cases are cited in the judgment:

Avia Aihi v The State (No 1) [1981] PNGLR 81

Chief Collector of Taxes v Bougainville Copper Ltd (2007) SC853

Drew v Towers Investments [1973] PNGLR 450

Frederick Martins Punangi v Sinai Brown, Minister for Public Service (2004) N2661

Gene v Hamidian-Rad [1999] PNGLR 444

Gobe Hongu Limited v National Executive Council (1999) N1920

Hilary Singat v Commissioner of Police (2008) SC910

John Momis v Attorney-General [2000] PNGLR 109

Malewo v Faulkner & Ok Tedi Mining Co Ltd (2009) SC960

Manum and Mano v Dage (2003) N2435

Mauga Logging Company Ltd v South Pacific Oil Palm Pty Ltd [1977] PNGLR 80

Mision Asiki v Manasupe Zurenuoc (2005) SC797

NCDC v Yama Security Services Ltd (2005) SC835

NCDC v Yama Security Services Pty Ltd (2003) SC707

Pansat Communications Pty Ltd v Vele and The State (1999) SC604

Paul Paraka v Eastern Highlands Provincial Government (2005) SC809

Polem Enterprise Ltd v Attorney-General (2008) SC911

Public Prosecutor v Nahau Rooney (No 2) [1979] PNGLR 448

SCR No 2 of 1981; Re Section 19(1)(f) Criminal Code [1982] PNGLR 150

Sealark Shipping Pty Ltd v The Secretary for Treasury (1998) N1732

Simon Mali v The State (2002) SC690

Supreme Court Reference No 3 of 1984; Ex Parte Rowan Sidney Callick and Joe Koroma [1985] PNGLR 67

Telikom PNG Ltd v ICCC & Digicel (PNG) Ltd (2008) SC906

The State v Manorburn Earthmoving Ltd (2003) SC716

Uma More v UPNG [1985] PNGLR 41

Vailala Purari Investment Ltd v Papua New Guinea Forest Authority (2004) N2594

Wagambie v Lokinap [1991] PNGLR 145

Yer & Others v Yama (2009) SC990

APPEAL

This was an appeal against an order of the National Court that the Secretary for Finance release and clear a cheque intended as part-payment of public money due under a deed of settlement between a private citizen and the State.

Counsel

L N Makap, for the first appellant

N B Kubak, for the second & third appellants

S Kassman, for the fourth appellant

P B Lomai, for the respondent

30 October, 2009

1. BY THE COURT: This is an appeal against an order of the National Court (Paliau AJ) that required the Secretary for Finance, Mr Gabriel Yer, to release and clear a cheque for K7.75 million in public money that had been drawn and given to the respondent, Mr Peter Yama. The Secretary had put a stop order on the cheque and Mr Yama sought the court order to get the Secretary to release and clear it.

2. The Secretary and three other parties are appealing against the order on five grounds. Before we deal with them it is necessary to explain how the cheque for K7.75 million came to be drawn in Mr Yama’s name and the circumstances in which the order was made.

THE DEED OF SETTLEMENT AND THE CHEQUE FOR K7.75 MILLION

3. The cheque was processed by the Department of Finance and given to Mr Yama in June 2008. It was part-payment of money he says was due to him under a deed of settlement between him and the State signed in November 2002. The deed related to an out-of-court settlement of National Court proceedings WS No 1315 of 2002 Mr Yama commenced against the State over land in Madang town. Mr Yama was granted a State Lease over the land in 1988 but claimed that traditional landowners prevented him developing the land and that the State was responsible for what happened. He sought damages of K38.69 million and settled the matter for K15.5 million. The then Solicitor-General, Mr Zachary Gelu, signed the deed on behalf of the State.

4. Nothing was paid, however, and in May 2008 Mr Yama’s lawyers wrote to the Secretary requesting payment of the K15.5 million immediately. Then the Acting Solicitor-General, Mr Neville Devete, wrote to the Secretary, also in May 2008, recommending payment.

5. The cheque for K7.75 million (half the amount of the deed of settlement) was drawn on 24 June 2008, apparently on the directions of the Acting Secretary for Finance, Mrs Doriga Henry, and given to Mr Yama. On the same day, however, the Acting Secretary put a stop order on the cheque. Then the stop order was rescinded on 26 June. Mr Yama deposited the cheque into his personal account at the ANZ Bank on 27 June but the Secretary, Mr Yer, who was overseas at the time, intervened on the same day by reinstating the stop order.

NATIONAL COURT PROCEEDINGS

6. Five days later, on 2 July 2008, Mr Yama commenced proceedings in the National Court, as plaintiff, by originating summons, OS No 371 of 2008, seeking an order that the Secretary comply with the November 2002 deed of settlement and pay him K15.5 million. On the same day he filed a notice of motion seeking an order by way of mandamus to compel the Secretary to release and clear the cheque for K7.75 million within 24 hours.

7. The originating summons and notice of motion were served on the Secretary’s office (but not on him personally) and also on the Office of Solicitor-General on the afternoon of 2 July 2008. The Secretary is the first defendant in those proceedings, the Prime Minister’s Chief of Staff, Mr Leonard Louma, second defendant, and the State, third defendant. Those parties have become the first, second and third appellants in the appeal and been joined by Chief Commissioner Maurice Sheehan of the Commission of Inquiry into the Department of...