United Enterprises Ltd v Benny Allan

• Jurisdiction: Papua New Guinea
• Judge: Gavara-Nanu J
• Judgment Date: 21 September 2018
• Citation: (2018) N7551
• Court: National Court
• Year: 2018
• Judgement Number: N7551

Full : OS (JR) No. 410 of 2015; United Enterprises Limited v Benny Allan, Minister for Department of Lands and Physical Planning (First Defendant) and Romilly Kila Pat, Secretary for Department of Lands and Physical Planning (Second Defendant) and Benjamin Samson, Acting Registrar of Titles (Third Defendant) and Aku Engineering Limited (Fourth Defendant) and The Independent State of Papua New Guinea (Fifth Defendant) and Arrow Trading Limited (Sixth Defendant) (2018) N7551

National Court: Gavara-Nanu J

Judgment Delivered: 21 September 2018

N7551

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

OS (JR) No. 410 of 2015

BETWEEN:

UNITED ENTERPRISES LIMITED

Plaintiff

AND:

BENNY ALLAN, MINISTER FOR DEPARTMENT OF LANDS AND PHYSICAL PLANNING

First Defendant

AND:

ROMILLY KILA PAT, SECRETARY FOR DEPARTMENT OF LANDS AND PHYSICAL PLANNING

Second Defendant

AND:

BENJAMIN SAMSON, ACTING REGISTRAR OF TITLES

Third Defendant

AND:

AKU ENGINEERING LIMITED

Fourth Defendant

AND:

THE INDEPENDENT STATE OF PAPUA NEW GUINEA

Fifth Defendant

AND:

ARROW TRADING LIMITED

Sixth Defendant

Waigani: Gavara-Nanu J.

2018: 20th June & 21st September

PRACTICE & PROCEDURE - Judicial Review - Claim for damages – National Court Rules; Order 16 r 7 – Requirements to be satisfied – Court’s power to order damages – Condition precedent – National Court Rules; Order 8 Divisions 1 and 2 – Pleadings.

PRACTICE & PROCEDURE – Judicial Review – National Court Rules; Order 16 r 7 (1) – Damages – Liability – Court’s power to enter default judgment – Damages to be assessed.

Cases Cited:

Papua New Guinea Cases

Koitachi Farms Limited v. Walter Schnaubelt (2007) SC870

Marie Iravela v. Benjamin Samson & Ors (2018) N7212

Papua Club Inc. v. Nusaum Holdings Ltd (No.2) (2004) N2603

Other Cases Cited:

Assets Company Ltd v. Mere Roihi and Others [1905] AC 176

Counsel:

I. Shepherd, for the Plaintiff

S. Ketan, for the Sixth Defendant

21st September, 2018

1. GAVARA-NANU J: Pursuant to an amended Notice of Motion filed under Oder 16 r 5 (1) of the National Court Rules (NCR), on 4 April, 2018, the plaintiff seeks review of the decisions of the third defendant to register instruments 1-13038 and 1-13346, respectively on 5 December, 2007 and 4 June, 2008 on State Lease Volume 15 Folio 121 and to register an unascertained instrument number on a date unknown on the above named State Lease, pursuant to which the property described as Allotment 12, Section 35 Kimbe, West New Britain Province (the property) was transferred from the fourth defendant to the sixth defendant.

2. The plaintiff seeks orders in the nature of certiorari to quash the above decisions.

3. The plaintiff also seeks orders that the sixth defendant, to within 14 days of the date of these orders, return the owner’s copy of the State Lease to the third defendant.

4. Finally, the plaintiff seeks orders in the nature of mandamus to compel the third defendant to register the plaintiff as the registered proprietor of the State Lease pursuant to the Transfer Instrument dated 6 November, 2003. Further, that the third defendant amend his records to reflect these orders.

5. The plaintiff in the alternative seeks damages against the first, second, third and fifth defendants for its loss of enjoyment of the property and for economic loss.

6. The plaintiff seeks interest at commercial rate.

7. This case has a long history. The following background facts are not in dispute. By an Order of the National Court, a company called Holman Corporation Limited was placed in liquidation in 2002. By a contract of sale dated 6 November, 2003, the plaintiff agreed to purchase the property from the liquidator, after the property was offered for sale on public tender. The Transfer Instrument was stamped and approved by the delegate of the first defendant on 6 February, 2004 and the settlement occurred on 14 April, 2004.

8. On 24 May, 2004, the owner’s copy of the State Lease together with the stamped and approved Transfer Instrument, were lodged with the third defendant for registration of the transfer of the title to the plaintiff. These documents were never returned to the plaintiff’s lawyers and the plaintiff has never been registered as the proprietor of the property.

9. In the interim, the officers of the Department of Lands and Physical Planning including the third defendant allowed the property to go through a number of sales. The details of those sales are as follows:

(i) 05 December, 2007 transfer from Cape Holman Corporation Ltd to Kina Real Estate & Auctioneers Limited;

(ii) 14 April, 2008 transfer from Kina Real Estate & Auctioneers Limited to Nangha Enterprises Ltd;

(iii) 28 April 2008, transfer from Kina Real Estate & Auctioneers Limited to the Aku Engineering Limited (fourth defendant).

10. Subsequently, Aku Engineering Limited sold the property to the sixth defendant. The Transfer of the title from Aku Engineering Limited to the sixth defendant was registered on 26 April, 2013. The sixth defendant at all material times was not aware of the plaintiff’s interests in the property and the fact that the property had previously been through several sales.

11. The defendants were all served with the relevant court documents including the Notice of Trial.

12. During Directions hearings, the State lawyers appeared in Court only a few times. The fourth defendant on the other hand did not appear at all in any of the Directions hearings. The lawyer for the State nonetheless certified the Review Book together with the lawyers for the plaintiff and the sixth defendant.

13. On 23 April, 2018, when the matter returned to Court for the last Directions hearing, counsel for the State, Mr. Yano was present in Court. On that day the matter was fixed for trial on 20 June, 2018.

14. The affidavit of service filed by the plaintiff’s lawyers, shows that the Notice of Trial (giving the trial date) was served on the State on 30 April, 2018.

15. However, on 20 June, 2018, the lawyer for the State did not attend the hearing, only counsel for the plaintiff and the sixth defendant attended. The Court having satisfied itself that the State and the fourth defendant had been made fully aware of the trial date, proceeded to hear the matter with only counsel for the plaintiff and the sixth defendant presenting arguments on behalf of their respective clients.

16. The sixth defendant has developed the property to the value of over K3 million.

17. The proceeding was issued on 10 July 2015, however the sixth defendant first became aware of it on or about 5 July, 2016, when it was served with court documents. The first to fifth defendants did not defend the case. They, especially the third defendant have not filed any affidavits in defence of the plaintiff’s claims, including explaining how and why the property went through a number of sales, including the sale to the sixth defendant, while the matter was with the third defendant for the title to be registered under plaintiff’s name.

18. The plaintiff has conceded that the sixth defendant purchased the property from the fourth defendant in good faith and that by the time it became aware of the plaintiff’s interests in the property, it had done substantial improvements to the property.

19. There is evidence that the plaintiff had written to the third defendant pointing out in detail certain anomalies resulting from the above mentioned sales and asked the third defendant to correct the anomalies. However, no action was taken by the third defendant to correct those anomalies. For example, invoking the process under ss. 160 and 161 of the Land Registration Act, Chapter 191, to recall and cancel the sixth defendant’s title.

20. There is no evidence of actual fraud under s. 33 of the Land Registration Act. See Papua Club Inc v. Nusaum Holdings Ltd (No.2) (2004) N2603; Marie Iravela v. Benjamin Samson & Ors (2018) N7212 and Koitachi Farms Limited v. Walter Schnaubelt (2007) SC870. See also Assets Company Ltd v. Mere Roihi and Others [1905] AC 176.

21. As I understood the argument by Mr. Ian Shepherd of counsel for the plaintiff, notwithstanding the other relief sought, the plaintiff would be content with the alternative relief in damages which he argued arose from the failure of the third defendant to protect the plaintiff’s interests by allowing the property to be sold several times and failing to register the title under plaintiff’s name. This argument has not been denied or challenged by the first to fifth defendants. The argument has merit and I accept it. I find that the third defendant neglected his statutory duty to register the property under plaintiff’s name. The third defendant’s neglect of his statutory duty has not only rendered him liable to any damages suffered by the plaintiff but the first to third and the fifth defendants as well.

22. I am of the view that given that the property has gone through several sales, including the sale to the sixth defendant and that the sixth defendant was completely unaware of the plaintiff’s interest in the property, and that it has made...