OS NO 126 OF 2013; Bioma Ekamo Holdings Limited v Marc Orisuru Avai—Administrator, Gulf Provincial Administration and Gulf Provincial Government and Dr. Peter Ga’allah Kora (Phd)—Secretary, Department of National Planning & Monitoring and Chairman of the Economic Implementation Committee and Department of National Planning & Monitoring and Steven Gibson, Department of Finance and Department of Finance and Rendel Rimua—Secretary, Department Of Petroluem & Energy and Department of Petroluem & Energy and The Independent State of Papua New Guinea (2014) N5561

• Jurisdiction: Papua New Guinea
• Judge: Makail, J
• Judgment Date: 28 March 2014
• Court: National Court
• Citation: (2014) N5561
• Year: 2014
• Judgement Number: N5561

Full Title: OS NO 126 OF 2013; Bioma Ekamo Holdings Limited v Marc Orisuru Avai—Administrator, Gulf Provincial Administration and Gulf Provincial Government and Dr. Peter Ga’allah Kora (Phd)—Secretary, Department of National Planning & Monitoring and Chairman of the Economic Implementation Committee and Department of National Planning & Monitoring and Steven Gibson, Department of Finance and Department of Finance and Rendel Rimua—Secretary, Department Of Petroluem & Energy and Department of Petroluem & Energy and The Independent State of Papua New Guinea (2014) N5561

National Court: Makail, J

Judgment Delivered: 28th March 2014

N5561

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

OS NO 126 OF 2013

BETWEEN

BIOMA EKAMO HOLDINGS LIMITED

Plaintiff

AND

MARC ORISURU AVAI – ADMINISTRATOR, GULF PROVINCIAL ADMINISTRATION

First Defendant

AND

GULF PROVINCIAL GOVERNMENT

Second Defendant

AND

DR. PETER GA’ALLAH KORA (PhD) – SECRETARY, DEPARTMENT OF NATIONAL PLANNING & MONITORING AND CHAIRMAN OF THE ECONOMIC IMPLEMENTATION COMMITTEE

Third Defendant

AND

DEPARTMENT OF NATIONAL PLANNING & MONITORING

Fourth Defendant

AND

STEVEN GIBSON, DEPARTMENT OF FINANCE

Fifth Defendant

AND

DEPARTMENT OF FINANCE

Sixth Defendant

AND

RENDEL RIMUA – SECRETARY, DEPARTMENT OF PETROLUEM & ENERGY

Seventh Defendant

AND

DEPARTMENT OF PETROLUEM & ENERGY

Eighth Defendant

AND

THE INDEPENDENT STATE OF PAPUA NEW GUINEA

Ninth Defendant

Waigani: Makail, J

2013: 11th October & 2014: 28th March

PRACTICE & PROCEDURE – Preliminary question raised by Court on its own motion – Question of appropriateness of proceedings – Mode of proceedings – Proceedings commenced by originating summons – Claim for money – Recovery of outstanding funds – Funds approved for payment by Expenditure Implementation Committee – Money paid for construction of office complex and water supply project – Money paid under Agreement – Withholding of funds – Authority of – Defence deny liability – Work incomplete and sub-standard – No acquittals of funds – No report provided on progress of projects – Construction of agreement – Identification of issues – Issues clear and straight forward – National Court Rules – O 4, r. 3.

Cases cited:

Mision Asiki v Manasupe Zurenuoc & Ors (2005) SC797

Telikom PNG Limited v Independent Consumer & Competition Commission (2008) SC906

Gabriel Yer v Peter Yama (2009) SC996

William Duma v Eric Meier (2007) SC898

Wahgi Mek Plantations Limited v Robert Mudiye & Ors (2011) N4383

Joseph Koroma v David Tigavu & Ors: OS No 252 of 2006 (Unnumbered and Reported Judgment of 16th August 2006

Tigam Malewo & Ors v Keith Faulkner & Ors (2007) N3357

NCDIC v Bogibada Holdings Pty Ltd [1987] PNGLR 135

TS Tan v Elcom (2002) SC683

Ok Tedi Mining Ltd v Niugini Insurance Corporation (No. 2) [1988-89] PNGLR 45

Telikom PNG Ltd v ICCC (2007) N3144

Kurubu Ipara & Anor v Daniel Yaluma (2010) N4277

Counsel:

Mr M Kombri, for Plaintiff

Mr B Ovia, for First & Second Defendants

Ms F Baton, for Fourth & Ninth Defendants

RULING

28th March, 2014

1. MAKAIL, J: This is a ruling on a preliminary question raised by the Court, on its own motion, before the hearing of the plaintiff’s application for summary judgment. The question is the appropriateness of the proceedings. Its determination will determine whether or not these proceedings will continue.

2. The plaintiff is a company incorporated under the provisions of the Companies Act 1997. It claims to be a landowner company and commenced these proceedings by originating summons to seek declaratory relief to declare, among others, that a committee called the Expenditure Implementation Committee (“Committee”) is the only authorised body to approve funds for infrastructure projects under clause 13.1(e) of the PNG LNG Pipeline Licence Benefit Sharing Agreement dated 26th November 2009 (“Benefit Sharing Agreement”), that the first and second defendants had no authority to approve or withhold funds, and an order for payment of a sum of K9,500,000.00.

3. This sum, it alleged, was part of K15,000,000.00 approved by the Committee and chaired by the third defendant, to fund the construction of an office complex for the Gulf Provincial Administration and Apeawa Water Supply in Kikori under the infrastructure projects programme within the pipeline areas where pipes for the Liquefied Natural Gas (“LNG”) project will run. These funds are referred to as or called “Infrastructure Development Grants” and are catered for by the State under Benefit Sharing Agreement.

4. It further alleged that it submitted proposals to the Committee for these projects and the Committee approved them. In 2011, a sum of K6,000,000.00 was transferred to the first and second defendants to disperse to it and they paid K5,500,000.00 and K9,500,000.00 is outstanding. It alleged that the first and second defendants wrongfully withheld this sum.

5. It submitted that under O 4, r. 3 of the National Court Rules, it had a choice to commence proceedings by originating summons or by writ of summons. It decided to use an originating summons because it was a quicker and easier way to determine the dispute. Further, it took this course because in a related matter, the plaintiffs used an originating summons to commence proceedings and successfully obtained summary judgment against the same defendants. That was in the case of Mrs Edau Gibere & Ors v The State and Gulf Provincial Government: OS No 125 of 2013. The evidence of the Originating Summons and Court Order may be found at annexure “A” and annexure “B” of the affidavit of Mr Bomsy Boviro filed on 13th June 2013.

6. It further submitted that the dispute is primarily over the authority of the first and second defendants to withhold funds and will involve the construction of the Benefit Sharing Agreement as to whether these defendants had authority to approve or withhold funds. It submitted that, it will submit at trial, that they had no authority and that they were obliged to release the funds to it in accordance with the decision of the Committee.

7. Finally, it relied on the decisions of the Supreme Court in Mision Asiki v Manasupe Zurenuoc & Ors (2005) SC797; Telikom PNG Limited v Independent Consumer & Competition Commission (2008) SC906; Gabriel Yer v Peter Yama (2009) SC996 and William Duma v Eric Meier (2007) SC898 and submitted that these cases held that a plaintiff has a choice of mode of proceedings and have refused to struck out proceedings commenced by originating summons where facts are not substantially disputed.

8. For these reasons, it submitted that the proceedings are not an abuse of process, should not be struck out and that it proceeds to move its application for summary judgment.

9. The first, second, fifth and ninth defendants were represented at the hearing. Relying on two affidavits by Mr Christopher Uari Haro and one by Ms Monica Lopyui, they denied liability and argued in their defence that the plaintiff has commenced a wrong mode of proceedings. They argued that the plaintiff’s purported cause of action is one of breach of contract as it is a claim for money. A claim for money should be commenced by writ of summons endorsed with a statement of claim.

10. The statement of claim, they argued, will set out the facts, particulars of the terms of the contract, particulars of breach and relief. The pleading of these matters will enable them to respond to the claim by way of a defence. From the statement of claim and the defence, they further argued, will enable the parties to identify the issues for trial. In this case, most of the facts are disputed because they alleged, among others, that:

· Firstly, while the Committee is the authorised body to approved funding, and the funds are paid under the Benefit Sharing Agreement, there is no contract between the plaintiff and the defendants stipulating the rights and obligations of the parties as to who is responsible for managing the funds after approval by the Committee, how the funds are to be accessed by the successful applicant (contractor), acquittal of the funds and reporting conditions of the progress of the projects. In the event of a breach, there is no contract in place to enforce.

· Secondly, the work is incomplete and sub-standard.

· Thirdly, the plaintiff failed to acquit the funds and provide a report on the progress of the projects.

· Fourthly, the plaintiff is not a landowner company, as it claims. The company records from the Companies Office showed that it is owned by a family, the shareholders being Mr Bomsy Boviro and his wife Helen Boviro and they are the only signatories to its account held at BSP Bank, Port Moresby.

· Fifthly, the National Executive Council decided and directed that upon approval of projects for funding by the Committee, the funds will be transferred to trust accounts for Provincial Governments where the projects will be undertaken and that the Provincial Administrators will be the signatories to the accounts.

· Sixthly, the contracts will be tendered and awarded in compliance with the Public...