John Eru v Interoil (PNG) Ltd N6352

• Jurisdiction: Papua New Guinea
• Judge: Hartshorn J
• Judgment Date: 01 June 2016
• Court: National Court
• Year: 2016
• Judgement Number: N6352

Full : OS (COMM) No 274 of 2016; John Eru – Chairman representing the Hovoio Clan and Kavakore Amoa – Chairman representing the Horomiro Lavaipi Clan and Peter Mavore – Chairman representing the Horomiro Clan and Upper Ahia Landowners Association v Interoil (PNG) Ltd and Total E&P PNG Limited and Department of Petroleum & Energy and the Independent State of Papua New Guinea (2016) N6352

National Court: Hartshorn J

Judgment Delivered: 1 June 2016

N6352

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

OS (COMM) NO. 274 OF 2016

BETWEEN:

JOHN ERU – Chairman representing the Hovoio Clan

Plaintiff

AND:

KAVAKORE AMOA – Chairman representing the Horomiro Lavaipi Clan

Second Plaintiff

AND:

PETER MAVORE – Chairman representing the Horomiro Clan

Third Plaintiff

AND:

UPPER AHIA LANDOWNERS ASSOCIATION

Fourth Plaintiff

AND:

INTEROIL (PNG) LTD

First Defendant

AND:

TOTAL E&P PNG LIMITED

Second Defendant

AND:

DEPARTMENT OF PETROLEUM & ENERGY

Third Defendant

AND:

THE INDEPENDENT STATE OF PAPUA NEW GUINEA

Fourth Defendant

Waigani: Hartshorn J.

2016: 26th May

: 1st June

Application to dismiss this proceeding

Cases cited:

Ainsworth v. Criminal Justice Commission [1992] HCA 10; (1991-1992) 175 CLR 564

Bauf and Lavoi Nodai v. Poliamba Pty Ltd [1990] PNGLR 278

Dr. Onne Rageau v. Kina Finance Ltd (2015) N6175

Independent State of Papua New Guinea v. Central Provincial Government (2009) SC977

Kerry Lerro v. Stagg & Ors (2006) N3050

Mt Hagen Urban Local Level Government v. Sek No. 15 (2009) SC1007

National Fisheries Authority v. New Britain Resources Development Ltd (2009) N4068

Ok Tedi Mining Ltd v. Niugini Insurance Corporation and Others (No 2) [1988-89] PNGLR 425

Peter Makeng & Ors v. Timbers (PNG) Ltd & Ors (2008) N3317

Pius Pundi v. Chris Rupen (2015) SC1430

Placer Dome (PNG) Ltd v. Yako (2011) N4691

Rex Paki v. Motor Vehicles Insurance (PNG) Ltd (2010) SC1015

Siu v. Wasime Land Group Incorporated (2011) SC1107

Takori v.Yagari & Ors (2008) SC905

Timothy Patrick v. Pepi Kimas (2010) N3913

The Russian Commercial and Industrial Bank v. British Bank for Foreign Trade Ltd [1921] 2 AC 438

Counsel:

Mr. D. Korowa, for the Plaintiffs

Mr. M. Mukwesipu, for the First Defendant

Mr. J. Brooks, for the Second Defendant

Ms. M. Elisha, for the Third and Fourth Defendants

1st June, 2016

1. HARTSHORN, J: This is a decision on an application to dismiss this proceeding. The application is made by the second defendant, supported by the other defendants and opposed by the plaintiffs. The application is made pursuant to Order 12 Rule 40(1) (a), (b) or (c), Order 12 Rule 1 National Court Rules, s. 155(4) Constitution and the inherent jurisdiction of this court.

Background

2. The first three plaintiffs are each described as Chairman representing a particular Clan. The fourth plaintiff is described as a Landowners Association. In their Originating Summons that commenced this proceeding, the substantive relief that is sought by the plaintiffs’ is a declaration that it is a mandatory requirement pursuant to s. 47 Oil and Gas Act, prior to a Petroleum Development Licence being issued, that the defendants undertake social mapping and landowner identification studies. An order that the defendants “be compelled” in that regard, is also sought. This is in respect of an area known as Petroleum Retention Licence No. 15 (PRL 15). From the affidavit evidence filed on behalf of the plaintiffs’, it appears that they claim that they are landowners within PRL 15.

This Application

3. The second defendant submits that the proceeding should be dismissed as:

a) The plaintiffs’ lack the requisite standing to seek the substantive relief that they do and so the proceeding is frivolous;

b) There is no controversy as to the requirements of s. 47 Oil and Gas Act that this court needs to determine and so the proceeding is an abuse of process;

c) The declaration sought does not relate to any legal right that the plaintiffs’ are seeking to protect;

d) None of the defendants dispute the validity, application or interpretation of s. 47 Oil and Gas Act. There is no controversy between the parties – the issue raised being merely of academic interest;

e) The statutory rights of the plaintiffs’ and whatever rights the plaintiffs’ may have to be beneficiaries of the PRL 15 project, which are yet to be determined, will not be affected even if this court were to make the orders sought;

f) The declaratory relief sought is beyond hypothetical and is in fact pointless, futile and a waste of the court’s time;

g) This proceeding is frivolous, vexatious and an abuse of process;

h) As the plaintiffs’ are purporting to make representative actions, they must meet the necessary requirements for such actions but have not.

4. The plaintiffs’ contend that this proceeding should not be dismissed as amongst others:

a) The plaintiffs’ have already been recognised as landowners by the Department of Minerals & Energy;

b) The plaintiffs’ are merely seeking that the legitimate landowners be identified. That process has not occurred and so s. 47 Oil and Gas Act has not been complied with;

c) The various plaintiffs’ have given their necessary consent to this proceeding.

Law

s. 155(4) Constitution

5. As to s. 155(4) Constitution, it is settled law that it is only to be relied upon to protect the primary rights of parties in the absence of other relevant law. In addition, s. 155(4) cannot be applied to do anything contrary or inconsistent with the provisions of the National Court Rules: Peter Makeng & Ors v. Timbers (PNG) Ltd & Ors (2008) N3317 per Injia DCJ (as he then was). Consequently, as the defendants are able to have recourse to Order 12 Rule 40 National Court Rules, there is not an absence of other relevant law and so I will not consider s. 155(4) Constitution further.

Order 12 Rule 40 National Court Rules

6. There are numerous authorities in respect of the principles which apply to applications under Order 12 Rule 40 National Court Rules and I refer to the following cases in this regard: Kerry Lerro v. Stagg & Ors (2006) N3050, Takori v.Yagari & Ors (2008) SC905, Mt Hagen Urban Local Level Government v. Sek No. 15 (2009) SC1007 and Siu v. Wasime Land Group Incorporated (2011) SC1107. The Court in Mount Hagen v. Sek (supra) in paragraphs 27 to 30 conveniently sets out the requirements of Order 12 Rule 40 (1) (a), (b) and (c) as follows:

“27. The terms “vexatious”, “frivolous”, “abuse of the process of the Court” and “reasonable cause of action” under O.12 r.40 of the National Court Rules have been judicially considered, defined and expounded in a number of decisions in both the National and Supreme Courts. These cases include Ronny Wabia v. BP Exploration Co. Limited & 2 Others [1998] PNGLR 8 (N1697); PNG Forest Products Pty Ltd and Another v. The State and Genia [1992] PNGLR 85; Gabriel Apio Irafawe v. Yauwe Riyong (1996) N1915; Eliakim Laki and 167 Others v. Maurice Alulaku and Others (2002) N2001; Kiee Toap v. The Independent State of Papua New Guinea & Another (2004) N2766; Kerry Lerro trading as Hulu Hara Investments Limited v. Philip Stagg, Valentine Kambori & The State (2006) N3050; Philip Takori & Others v. Simon Yagari & 2 Others (2008) SC 905. These cases say the same thing.

28. The law with regard to an application for dismissal of proceedings based on O.12 r.40 is settled in our jurisdiction. We note that the principles are succinctly set out in Kerry Lerro’s case (supra) and which has more recently been approved and applied by the Supreme Court in Philip Takori’s case (supra).

29. The phrase ‘disclosing a reasonable cause of action’ consists of two parts; cause of action and form of action. A cause of action is defined as a legal right or form of action known to law whereby a plaintiff in a statement of claim must plead all necessary facts and legal elements or ingredients to establish or prove his claim. The principles stated by these cases can be summarized as follows:

(i) A plaintiff or claimant should not be driven from the judgment seat in a summary manner and that the Court should be cautious and slow in exercising its discretionary power.

(ii) The Court has an inherent jurisdiction to protect and safeguard its processes from abuse.

(iii) The purpose of O.12 r.40, is to give the Court power to terminate actions or claims which are plainly frivolous or vexatious or untenable.

(iv) A frivolous claim is one that is characterized as a claim that is plainly and obviously untenable, that cannot possibly succeed and bound to fail if it proceeds to trial.

(v) A vexatious claim is one that is said to be a sham and cannot succeed where it seeks to merely harass the opposing party and put that party to unnecessary trouble and expense in defending or proving the claim.

30. In an application under O.12 r.40 of the NCR, the Court may dismiss a proceeding or action where it is satisfied that the pleading in the statement of claim is seriously wanting where a necessary fact or legal element has not been pleaded.”

Declaratory relief

9. As the plaintiffs’ seek declaratory relief, it is necessary...