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Sigulogo, Re [1988] PGLT 2; [1988-89] PNGLR 384 (2 October 1989)

Papua New Guinea Law Reports - 1988-89

[1988-89] PNGLR 384 - Re Gerard Sigulogo�

[1988-89] PNGLR 384

N756

PAPUA NEW GUINEA

[LEADERSHIP TRIBUNAL]

IN THE MATTER OF A REFERENCE BY THE PUBLIC PROSECUTOR UNDER SECTION 27(2) OF THE ORGANIC LAW ON DUTIES AND RESPONSIBILITIES OF LEADERSHIP AND IN THE MATTER OF GERARD SIGULOGO

Waigani

Bredmeyer J Oli SM Seneka SM

5-6 July 1989

14 July 1989

17 July 1989

2 October 1989

CONSTITUTIONAL LAW - Leadership Code - Misconduct in office - Proceedings for - Nature of - Evidence on - Leadership Tribunal to inform itself in such manner as thinks proper - Independent Commission of Inquiry reporting on matters before Tribunal - Inquiry material admissible - Organic Law overriding statute law - Constitution, ss 9, 10 - Organic Law on Duties and Responsibilities of Leadership (Ch No 1), s 27(4) - Commissions of Inquiry Act (Ch No 31), s 13.

CONSTITUTIONAL LAW - Leadership Code - Misconduct in office - Particular offences - Using office for personal benefit - �Corruptly� asking for benefit - Requires purposeful forbidden act tending to corruption - Allowing integrity to be called in question - Using office for personal gain - Attempt to use office not chargeable - Member of Parliament requesting K30,000 from foreigner to support logging operations - Constitution, s 27(1)(c), (2) - Organic Law on Duties and Responsibilities of Leadership (Ch No 1), ss 5, 11.

CONSTITUTIONAL LAW - Leadership Code - Misconduct in office - Punishment - Member of Parliament - Request for K30,000 from foreigner to support logging operations - Dismissal from office recommended - Constitution, s 28 - Leadership Code (Alternative Penalties) Act (Ch No 1A), s 2.

PARLIAMENT - Members - Misconduct in office - Proceedings for - Particular offences - Punishment - Constitution, ss 9, 10, 27(1)(c),(2), 28 - Organic Law on Duties and Responsibilities of Leadership (Ch No 1), ss 5, 11, 27(4) - Leadership Code (Alternative Penalties) Act (Ch No 1A), s 2.

The Organic Law on Duties and Responsibilities of Leadership (Ch No 1) (the Organic Law) provides that a person to whom the law applies, which includes Members of Parliament, is guilty of misconduct in office:

N2>(a)����� where he directly or indirectly asks for or accepts any benefit in relation to any action (past, present or future) in the course of his duties or by reason of his official position (s 5);

N2>(b)����� where he �corruptly asks for, receives or obtains� any property, benefit or favour of any kind for himself in consideration of his actions as a public official (s 11).

The Constitution, s 27, relevantly provides that a Member of Parliament has a public duty to conduct himself as not to allow his public or official integrity, or his personal integrity, to be called in question (s 27(1)(c)); and shall not use his office for personal gain (s 27(2)).

Punishment for misconduct in office is prescribed by the Constitution, s 28, and the Leadership Code (Alternative Penalties) Act (Ch No 1A), s 2, and includes:

N2>(a)����� a recommendation for dismissal from office;

N2>(b)����� a fine not exceeding K1,000;

N2>(c)����� good behaviour bond;

N2>(d)����� suspension without pay;

N2>(e)����� reprimand;

N2>(f)����� reduction in salary; and

N2>(g)����� demotion.

The Organic Law, s 27(4), provides:

�The tribunal shall make due inquiry into the matter referred to it, without regard to legal formalities or the rules of evidence, and may inform itself in such manner as it thinks proper, subject to compliance with the principles of natural justice.�

The Commissions of Inquiry Act (Ch No 31), s 13, provides:

�A statement or disclosure made by a witness in answer to a question put to him by a Commission or by a Commissioner is not (except in proceedings for an offence against this Act) admissible in evidence against him in any civil or criminal proceedings.�

Held

N1>(1)����� Proceedings charging misconduct in office under the Organic Law are criminal in nature.

N1>(2)����� Because the Organic Law is under s 9 and s 10 of the Constitution, a superior law to statute law, s 27(4) of the Organic Law should override s 13 of the Commissions of Inquiry Act so that where an independent Commission of Inquiry, observing the rules of natural justice, has investigated a relevant matter in depth, the Leadership Tribunal may inform itself by means of that available material.

N1>(3)����� Accordingly, relevant material from the Barnett Commission of Inquiry was admissible before the Tribunal.

N1>(4)����� Where a Member of Parliament wrote a letter to the Managing Director of a foreign corporation requesting K30,000 so that he would continue to put his weight as a Member of Parliament behind overseas logging operations, he was guilty of the offence of using his office for personal benefit contrary to s 5 of the Organic Law.

N1>(5)����� For the purposes of s 11 of the Organic Law, the word �corruptly� does not mean dishonestly; it means purposefully doing an act which the law forbids as tending to corrupt.

R v Wellburn (1979) 69 Cr App R 254 at 264, adopted and applied.

N1>(6)����� In the circumstances, the letter requesting K30,000 was written �corruptly� and the Member of Parliament was guilty of the offence of corruptly asking for a benefit contrary to s 11 of the Organic Law.

N1>(7)����� In the circumstances, the letter requesting K30,000 was written in such a way as to allow the official integrity of the Member of Parliament to be called in question contrary to s 27(1)(c) of the Constitution.

N1>(8)����� The offence under s 27(2) of the Constitution of using �his office for personal gain� requires proof that the person concerned actually uses his office for personal gain: it does not apply to attempts.

N1>(9)����� In the circumstances, in the writing of the letter requesting K30,000, the Member of Parliament attempted to use his office for personal gain and was not guilty of any breach of s 27(2) of the Constitution.

N1>(10)��� The offences of misconduct in office relating to the letter requesting K30,000 were serious offences which each, in the public interest, warranted recommendation for dismissal from office pursuant to s 28(1)(g)(ii) of the Constitution.

Cases Cited

R v Wellburn (1979) 69 Cr App R 254.

Reference

This was the hearing and determination of a Reference by the Public Prosecutor pursuant to s 27(2) of the Organic Law on Duties and Responsibilities of Leadership (Ch No 1) of a number of charges of misconduct in office.

Counsel

C J Russell, for the Public Prosecutor.

J Yagi, for the person charged.

Cur adv vult

2 October 1989

BREDMEYER J OLI SM SENEKA SM: On 16 July 1987, Gerard Sigulogo became the newly elected Member for Kavieng Open in the National Parliament. He was a first-time Member of Parliament and, as a Member of Parliament, he was subject to the Leadership Code provisions of the Constitution and the Organic Law on the Duties and Responsibilities of Leadership (Ch No 1), hereinafter called the Organic Law. Under s 27 of the Constitution, he was required not to misconduct himself in public, official or private life and not to allow his integrity to be called into question. He was also required not to use his office for personal gain. Under s 4 of the Organic Law, he was required to file a true statement of his income, assets and liabilities within three months after becoming a Member of Parliament, and under s 12 of that Law, he was not allowed to accept any gifts or other benefit from any person without first having gained an exemption from the Ombudsman Commission.

Mr Sigulogo went on a trip to Singapore with his wife from 16 to 23 September 1987. He was accompanied by Mr Francis Sia and members of his family and the trip was financed by Mr Sia. Mr Sigulogo did not get prior approval from the Ombudsman Commission for the trip and he has been charged with four charges in connection with that trip, namely the receipt of airline tickets to the value of K1,357, the receipt of K2,000 spending money, the receipt of three safari suits to the value of 300 Singapore dollars, and the gift of free accommodation at the Apollo Hotel, Singapore, to the value of K182.73. Mr Sigulogo has pleaded guilty to those four charges and it remains for us later to discuss that trip in its context and to decide on the appropriate punishment.

On 5 October 1987, Mr Sigulogo wrote to Mr Francis Sia, then the Managing Director of Malaysia Overseas Investment (PNG) Pty Ltd, and asked for K30,000. That letter is the subject of four charges before us. Mr Sigulogo admits writing the letter but denies that he was guilty of any misconduct in so doing. The final charge before us relates to the first Leadership Code statement of income, assets and liabilities which Mr Sigulogo submitted to the Ombudsman Commission on 25 November 1987. That charge alleges that Mr Sigulogo failed to mention an outstanding liability, namely that he owed K1,080 to Mr Marget Tomadek for the rent of Mr Tomadek�s house in Kavieng. Mr Sigulogo admits that he omitted to mention that liability in his statement but denies that he did so knowingly, recklessly or negligently and denies that he is guilty of the offence charged.

THE BARNETT COMMISSION OF INQUIRY

Before discussing the charges, we must deal with a point of evidence. The letter of 5 October 1987 asking for K30,000 was found by the police when they searched Mr Sia�s office under a search warrant. That letter and much other evidence against Mr Sia was uncovered by the Barnett Commission of Inquiry. Commissioner Barnett discusses Mamirum Timbers and Malaysia Overseas Investment and the role of Mr Sigulogo in Interim Report No 4 headed �Timber Exploitation in New Ireland Province�, Vol 2, Appendix 1. That appendix covers 35 pages of text and 57 pages of schedules which consist of exhibits such as letters, legal documents and calculations. At the outset of our hearing, we had to decide what use we should make of this report. Section 27(4) of the Organic Law provides:

N2>�(4)��� The tribunal shall make due inquiry into the matter referred to it, without regard to legal formalities or the rules of evidence, and may inform itself in such manner as it thinks proper, subject to compliance with the principles of natural justice.�

That section suggests that we can make use of another�s work. On the other hand, s 13 of the Commissions of Inquiry Act (Ch No 31), under which the Barnett Commission of Inquiry was established, provides:

N2>�13.��� Statements by witness not admissible in evidence against him

A statement or disclosure made by a witness in answer to a question put to him by a Commission or by a Commissioner is not (except in proceedings for an offence against this Act) admissible in evidence against him in any civil or criminal proceedings.�

That section means that any admissions made by Mr Sigulogo to the Barnett Commission of Inquiry are not admissible in evidence against him in any civil or criminal proceedings. Our tribunal is not a normal civil or criminal proceeding but it is very much akin to a criminal proceeding. It is true that the standard of proof is not as high as in a criminal proceeding, and under s 27(4) of the Organic Law, which we have already quoted, the strict rules of evidence do not apply. Nevertheless, the punishments we can impose, if we find the leader guilty of misconduct, are quite severe. We can recommend his dismissal from office and that recommendation is binding on the Head of State, we can fine him up to K1,000 and we can also impose lesser penalties. We consider that our proceedings are very similar to criminal proceedings. However, under the hierarchy of laws established by s 9 and s 10 of the Constitution, the Organic Law is a superior law to a statute and a statute must be read and construed subject to any relevant Organic Law. We thus consider that s 27(4) of the Organic Law overrides s 13 of the Commissions of Inquiry Act and we propose to admit the Barnett Report in evidence before us. We made that ruling, after hearing argument, at the outset of our inquiry. It seemed important to us to make that ruling to avoid a multiplicity of legal proceedings. Moreover, where an independent Commission of Inquiry, observing the rules of natural justice, has investigated a matter in depth, we should get the benefits of its research without having to replicate that hearing. Having said that, we note that the Barnett Commission of Inquiry does not rely very much, if at all, on any admissions made by Mr Sigulogo and we have not seen or read any transcript of evidence which he gave before the Barnett Commission.

The evidence we heard in this case consists of the report of the Barnett Commission, which we have mentioned, a number of documents which were tendered to us by counsel for the Public Prosecutor without objection and sworn evidence from Mr Sigulogo. Most of the primary facts in this case are not disputed. As we have said, Mr Sigulogo has admitted the charges relating to the trip to Singapore in full and has admitted writing the letter of 5 October 1987 requesting K30,000. He has an innocent explanation for that letter which we need to consider. He has also admitted failing to disclose K1,080 rent owing in his annual statement to the Ombudsman Commission but has denied that he is thereby guilty of an offence. His counsel has addressed legal arguments to us on the charges and has also tendered to us a character reference from a Seventh Day Adventist pastor.

BACKGROUND TO THE CHARGES

We supply the following background to the charges from the report of the Barnett Commission of Inquiry mentioned above:

N2>�(a)��� Introduction

The exploitation of the Mamirum Timber Rights Purchase (hereinafter TRP) area on New Hanover illustrates what can happen when the timber rights purchased by the government are rapidly expiring and there is a rush to find a contractor. With the aid of lawyer/consultant Miskus Maraleu, an entirely unsatisfactory contractor was found, who in conjunction with Maraleu, proceeded to deceive and deprive the landowner company and the landowners of any real benefit from the operation. The smallness of the financial return to the landowners from an unusual and unfair agreement was a disgrace and it was only made possible because Maraleu betrayed his own people for financial reward.

The fact that the Commission publicly exposed these matters finally resulted in the landowners getting a fairer deal.

N2>(b)����� Allocation of resource

In October 1974, TRP rights for a term of fifteen (15) years were acquired over the area of 12,270 hectares known as Mamirum on New Hanover Island, New Ireland Province. A joint venture company � Palmatas Development Company Pty Ltd � was granted a five year Timber Permit, commencing 1 March 1975, over the area. The Joint Venture was between H & C McArthur and a number of landowners from the area. As a result of non-compliance with terms and conditions of the Permit, the Department of Forests (hereinafter DOF) recommended cancellation of the Timber Permit. The Permit was cancelled on 30 June 1976. Due to political pressure a one year Timber Licence (Letter of Intent) was issued from 1 June 1976. The Company did not operate in the area again and the Licence expired. Further attempts to exploit the timber resource on New Hanover Island were begun in 1979 through LAVONGAI DEVELOPMENT CORPORATION PTY LIMITED which was attempting to launch a number of development projects for the New Hanover people including timber. There were difficulties with this company and a scandal over tuna bait royalties.

In the result, Mamirum Timbers Pty Ltd was incorporated on 28 February 1984 to apply for the Timber Permit over the Mamirum area which had by then been abandoned. It was intended to be a landowner company but the initial shareholders were Posa Pilak, Alphonse Marius Soiat and Gerard Sigulogo. Soiat was the first Chairman and Sigulogo was appointed as Secretary. By 22 March 1984 there were 9 directors, who theoretically represented 9 clan groups and Micah Kusak was Manager. A sum of K5,030 was subscribed for shares by representatives of the landowners but in fact no shares were issued. Instead K3,324 of that money was used as payments to Management; Sigulogo receiving K1,488, Kusak K1,200 and K636 was paid as wages. In evidence before the Commission, Mr Sigulogo, a former law student, described the failure to issue shares as something he �overlooked� as Secretary. Due to problems which had arisen, a replacement Timber Permit was allocated to Mamirum Timbers and the deadline to commence operations was 30 June 1986. Mamirum Timbers had been involved in protracted negotiations with Groome (PNG) Pty Limited to take on the job of contractor and the replacement Permit was intended to facilitate the conclusion of those negotiations. The Groome�s negotiations finally broke down, however, in about April 1986 leaving Mamirum Timbers under pressure to find a contractor and start operating before the 30 June deadline expired. On 30 April, Alphonse Soiat approached lawyer Miskus Maraleu for advice and assistance. Maraleu was well qualified for this task as he was a New Irelander, a lawyer, Chairman of the Forest Industries Council and principal of a timber consultancy company called Metepikai Holdings Pty Ltd. Soiat specifically approached Maraleu because of these qualifications and Maraleu conceded he was aware that Soiat and Mamirum Timbers relied heavily upon him.

N2>(c)����� Logging and marketing agreement

Maraleu accepted instructions from Mamirum Timbers to act as its lawyer in getting an extension of time to find a contractor and commence operations. Maraleu discussed the matter with Michael Cowan the Executive Director of FIC who introduced him to Francis Sia and his newly formed company, Malaysia Overseas Investment (PNG) Pty Ltd (MOI), as a suitable contractor for Mamirum Timbers. On 13 June 1986, Sia and Maraleu signed a Letter of Intent which provided that MOI would act as contractor and also that MOI would appoint Maraleu�s company Metepikai as its consultant. Acting now for all parties Maraleu wrote off to Secretary Mamalai and Minister Diro seeking an extension of time of one month for Mamirum Timbers to commence operations. He falsely and dishonestly gave as the reason that Mamirum Timbers was having difficulty finding a contractor. Surprisingly, time was extended by Secretary Mamalai until 31 October, a far longer period of extension than Maraleu had sought.

From FIC fax and telex files, it is clear that Maraleu obtained Mamirum Timber�s letterhead for use in an emergency and that he and Cowan both actively worked to ensure that MOI would be preregistered and approved as the logging and marketing contractor before the October deadline.

At this stage, MOI was a �two kina� company owned by Francis Sia and his wife. On 17 October 1986, it received preregistration by DOF. All the normal checks and procedures had been bypassed, including referral to the Preregistration Committee. Sia had previously been involved with his brother Michael in another timber company, Santa Investments Pty Ltd, but, had even a basic check been run on MOI by DOF, it would have shown that, although it was a foreign company, it lacked the necessary NIDA approval to be involved in the timber industry and that it had, almost literally, no working capital at all. This irregular preregistration granted in October followed after a direction which Minister Diro gave to the Secretary of DOF in May 1986. On 15 May, Diro had received a letter on Santa Investments� letterhead signed by Francis Sia as Managing Director of MOI in which he sought preregistration for MOI. Mr Diro penned a note at the foot of the letter to DOF Secretary Mamalai, directing that preregistration be granted (Schedule 1). On the same day as he directed MOI�s preregistration, Mr Diro wrote a letter to Francis Sia seeking donations for his political party for its coming electoral campaign. He sought donations totalling K117,500 to be paid between May 1986 and 1 June 1987 (Schedule 2).

MOI was NIDA registered in respect of fishing and wholesaling activities. In October it was pursuing NIDA registration in respect of forestry activities but formal registration had not been granted. Francis Sia knew of this lack of registration but says he proceeded because Mamirum Timbers as a local company wanted him to bring equipment on site and as Maraleu told him it was not illegal to do so because he had lodged a NIDA application. Maraleu denied giving such advice. Maraleu and Sia each asserted the other was lying on this issue. The sole business of MOI is its involvement in this timber concession.

The preregistration was not followed up immediately but was raised again in October at the same time as MOI was seeking NIDA registration to be involved in the timber industry. At that time Maraleu applied pressure on DOF by falsely saying that the equipment was already in place. In these circumstances, DOF Secretary Mamalai bypassed the Preregistration Committee and granted preregistration within three days of receiving details of the application. He then wrote to NIDA supporting MOI�s application to that Authority.

MOI formally employed Maraleu as its lawyer and it engaged Maraleu�s firm Metepikai as its consultant on a retainer of K1,500 per month. Acting for both MOI and Mamirum Timbers, despite the head-on conflict of interests involved, Maraleu drew up a Logging and Marketing Agreement on instructions given to him by Sia.

Maraleu did not even have or check the provisions of the new January 1986 Timber Permit but says he proceeded on statements from Sigulogo and Kusak that it did not vary materially from the Permit it replaced.

The agreement followed one of the two standard forms for Logging and Marketing Agreements whereby the contractor (MOI) would receive a given percentage of FOB price with the balance being retained by the permit holder (Mamirum Timbers). Under this type of arrangement it is normal for the permit holder to pay the FIC levy and the royalty payments from its retention fee and for the contractor to pay all the costs of logging and marketing. Responsibility for paying export tax varies from contract to contract. In this Logging and Marketing Agreement drawn up by Maraleu at Sia�s instruction the contractor�s percentage was set at 75 per cent (the top end of the scale) and the export tax, together with FIC levy and royalties, was to be paid from Mamirum Timber�s 25 per cent retention. Normally the contractor would bear all other expenses of the operation from its share. This agreement, however, was very different and was drawn up by Maraleu in a way which was most unfair to Mamirum Timbers. In addition to paying the above mentioned expenses, Mamirum Timbers was to also make the following payments to MOI:

In relation to these additional charges the evidence of Maraleu and Sia was again in conflict. Maraleu said Sia specifically instructed him sssto include these additional charges and that he, Maraleu, did not know what they represented. Sia said the charges were Maraleu�s idea; and that he engaged him (through Metepikai) as his paid consultant at K1,500 per month and left the whole question of the Logging and Marketing Agreement to Maraleu.

As lawyer acting for both parties, Maraleu was now clearly in an untenable and unethical position and could not possibly advise both parties fairly. Without warning Mamirum Timbers of the adverse and unusual conditions in the Logging and Marketing Agreement, he advised the directors to sign quickly before the commencement deadline expired, and they did. He claims that he later suggested that Mamirum Timbers should get another lawyer but by then it was too late. He also claims that he told Sia the agreement was conditional on DOF approval and that there were problems in that regard.

Maraleu was also still acting for both sides when the Logging and Marketing Agreement was later amended and made even more unfavourable to Mamirum Timbers Pty Ltd, as, although the administration charge was reduced from K6 to K4 per m³, the logging charge was raised from K27 to K35 per m³. The total of these unjustifiable deductions provided for in the Agreement was therefore raised from K34 per m³ to K40 per m³. (Whether the amendments were ever agreed to by Mamirum Timbers was challenged at the public hearing.) Maraleu agreed that this K40 per m³ first charge on proceeds of log sales was unusual in a 75/25 percentage type agreement but sought to place blame on the Department of Forests for not insisting on amendment and permitting the Agreement to operate despite lack of DOF approval.

The Logging and Marketing Agreement drawn up by Mr Maraleu was unfavourable to Mamirum Timbers Pty Ltd in other ways also. Under its Permit, certain obligations had been imposed upon Mamirum Timbers Pty Ltd. These included the construction of an Island Ring Road (which Mamirum had no ability to construct), the provision of a small sawmill and an obligation to fell a minimum of 15,00Om³ in year 1 and 25,00Om³ per year thereafter. If Mamirum Timbers failed to cut the minimum volume it would still have to pay royalty on it. All of these obligations are normally passed on to a contractor and should have been passed on to MOI in the Logging and Marketing Agreement but Maraleu failed to do this.

(When Maraleu eventually forwarded the signed Logging and Marketing Agreement to the Secretary of DOF for approval, as required under the Timber Permit, approval was withheld as it was considered to be too unfavourable to Mamirum Timbers. The Secretary insisted that the schedule of payments be adjusted in Mamirum Timber�s favour.)

The Agreement was also conditional upon MOI obtaining NIDA approval for forestry activities.

There was some disagreement between Soiat, Sigulogo and Kusak over the signing of the Agreement and a belief it would be reviewed after the first shipment. There is no doubt Maraleu failed Mamirum Timbers very badly. He knew of the reliance they placed in him and he betrayed their trust in a most disgraceful way in favour of his �paymaster� MOI.

No-one ever checked to find that the condition of MOI gaining NIDA registration was not fulfilled.

As the 31 October deadline approached, Sia made things very difficult for Maraleu and Cowan by going to Malaysia, obliging them to send numerous, increasingly desperate, telexes trying to track him down. Sia only returned to PNG on 13 October. As it became clear that they would overshoot the deadline, Maraleu, using Mamirum Timber�s letterhead and signing on its behalf without authority, wrote to the Secretary enclosing a Hastings Deering receipt for K7,500 for freight charge to ship two bulldozers to New Hanover. The receipt was not an official form but was in handwriting and was falsely dated 27 October 1986 giving the impression that the equipment had been despatched even though, at that time, it had not even been leased. The ploy worked and the Secretary DOF, satisfied that genuine arrangements were in progress to commence the operation, refrained from moving to cancel the permit. The equipment was not leased at that date because MOI essentially had no funds at all.

N2>(d)����� Funding MOI � �An air of dishonesty�

The problem of leasing the equipment was not finally resolved until 3 December 1986 when Cowan eventually committed FIC to guarantee a shortfall of K20,000 which enabled MOI to lease the equipment by a specially arranged second presentation of a cheque drawn on the Bank of South Pacific. In doing this, Cowan clearly exceeded FIC�s powers under the Forest Industries Council Act.

It has been possible to trace what subsequently happened with regard to MOI�s �opening capital� by studying FIC files and documents obtained by the Fraud Squad in raids on Sia�s house and office when investigating the activities of his other business, Santa Investments Pty Ltd. The loan arrangements involving FIC are dealt with in the Commission�s Interim Report No 3.

The equipment was leased on 5 December 1986 with the deposit paid by a BSP cheque for K32,000 which left a shortfall in MOI�s account of K20,000 which FIC guaranteed to pay by 31 January 1987. In early January, Sia had reached agreement with the Korean sales agent, S J Park, to whom he had promised the sales agency on the first shipment, for an advance of K20,000. Park found it difficult to send the money into PNG and asked Cowan to advance it from FIC funds owing to him. When the BSP called up FIC�s guarantee on 2 February, a very reluctant Cowan deposited USD21,366 into Sia�s account. This money (representing K20,000) was brought into PNG from FIC�s American USD account. Whether part of the deposit represents funds of FIC is still not resolved (see Interim Report No 3).

The loan by Park of this K20,000 is never referred to again in MOI�s books or in correspondence. In evidence Sia said it had never been repaid. This raises the possibility that it may have been repaid to Park out of proceeds of transfer pricing devices (discussed below).

In addition to this K20,000 paid in by Park/FIC, Sia claims he also put in K7,500 of his own money. The balance of the working capital was arranged by way of overdraft from the PNGBC Kavieng on the security of the first log shipment. MOI (PNG) Pty Ltd thus commenced operations with virtually no capital and proceeded in an attempt to pay for the whole operation out of the sale of logs. This was completely contrary to national forestry policy regarding foreign companies, as they were expected to bring adequate foreign capital from outside PNG to commence their operations.

Thus from his first involvement, there was an air of dishonesty associated with Sia�s activities.

It started with the highly partisan and suspiciously energetic support by Maraleu and Cowan of FIC. There was the false receipt obtained from Hastings Deering and the misleading letters written by Maraleu, some written without authority on Mamirum Timber�s letterhead. There was questionable Ministerial involvement in obtaining immediate Forestry preregistration for MOI without the normal checking procedures and then its application for NIDA approval was based on false documents as the Logging and Marketing Agreement submitted in support of its application was not the one actually in force between the parties. (The Agreement submitted to NIDA showed MOI showed MOI undertaking to do the various road works and community benefit projects specified in the Timber Permit whereas in fact MOI never did bind itself to satisfy these conditions.) Its opening capital was scraped together by an unauthorised FIC guarantee and later by means of a suspicious arrangement with S J Park and the use of an unauthorised FIC USD account. An unfair Logging and Marketing Agreement was prepared by MOI�s lawyer in flagrant breach of professional ethics and he then applied pressure to mislead Mamirum Timbers into signing it in a hurry.

As will now be seen the suspicious air of dishonesty associated with the arrangement for MOI to exploit the resource was then confirmed by the way it carried out its logging and marketing operation.

N2>(e)����� The logging operation

The logging operation commenced at Mamirum in February 1987. Under the Logging and Marketing Agreement MOI was obliged to submit monthly reports to Mamirum Timbers specifying, among other things, the volume and species of logs cut. The only reports made, however, were those supplied to give details of logs sold after each shipment. This must have made it difficult for Mamirum Timbers to monitor MOI�s performance, particularly its progress in felling the minimum volume of 40,000m³ by the end of 1987 required under the permit. By December 1987 it had cut only 17,00Om³. Forestry inspection reports show that, on the ground, operations were very unsatisfactory. Sia�s dishonesty and disregard of operating restrictions are illustrated by a telex which he sent at the outset of operations in February 1987 where he openly advised his sales agent, S J Park of Korea, of his intention to cut undersized premium trees if there is a market for them but asks Park not to disclose this intention to the Forest Industries Council.

The first shipment of logs was loaded in May 1987. At the date of its departure neither royalties nor export tax had been paid. The letter of credit had been made out in favour of MOI (PNG) Pty Ltd and the free-on-board price for 4,720m³ was eventually shown as K284,236.12. Out of this sum Sia paid K22,222 to Mamirum Timbers made up as follows:

K22,222.00

The K20,378 was to be paid to the State as royalties and the State in turn had the obligation to pay royalties to the landowners so Mamirum�s share of profit from that shipment which grossed K284,236 was K1,844 which is absurdly small. As we have said, the royalty payments were not paid at that time but they were paid to the value of K17,128.81 by MOI at the time of the second shipment (August/September 1987). This was because MOI was forced to pay them in order to get the government to clear the second shipment. Sia made that payment but deducted it from Mamirum Timbers� share of the money received from the second log shipment. Sia received from the second shipment K413,330.94 and after payment of outstanding royalties to the State and Sia�s deduction of other charges, Commissioner Barnett found that Mamirum Timbers was entitled to receive K48.66.

As stated above, most of Mamirum�s share of K22,222 was to be paid as royalties to the State. These were not paid. Instead the company�s share of the profits was paid out in management expenses as follows:

(It seems that no moneys were deducted from these wages for group tax.)

N2>(f)����� Soiat challenges MOI

At the time of the first shipment the Chairman of Mamirum Timbers was Alphonse Marius Soiat who was deeply disturbed at the gross inequity whereby his company received only K1,844 from an FOB price of K284,236. He instructed lawyer Sebulon Watt to inquire of MOI but MOI replied that the Managing Director of Mamirum Timbers, Micah Kusak, had advised that Watt did not act for Mamirum Timbers. (This is the first sign of a split in Mamirum management between those receiving a salary from MOI�s payments (Kusak and the Company Secretary Gerard Sigulogo) and the honorary Chairman Soiat.) At the time Maraleu had pressed Mamirum Timbers to sign the Logging and Marketing Agreement, it was clearly expressed that it would be subject to review after the first shipment. Soiat now tried to renegotiate but was opposed by Sia, Kusak and Sigulogo, and other Board members did not actively support Soiat.

One of the reasons for him receiving no support from the majority of Board members may have been that they had actually received fairly substantial personal benefits in the way of directors� fees and meeting allowances from the first log sale.

In the case of Gerard Sigulogo, he also (later) received tangible benefits in the form of a free return trip to Singapore and approximately K2,000 spending money and a watch for his wife. He received a written commitment from Sia to assist with election expenses to the extent of K2,000 which Sia promised in July would be paid from the second shipment proceeds. This aspect is further dealt with below. Sigulogo and Kusak were also claiming back pay at the rate of K15,000 and K18,000 per annum respectively, totalling between them K123,750.

Eventually Soiat decided to use direct action to gain justice for his people. He organized a landowners� protest march and landowners and company representatives squatted on the land. The police were called in and several were arrested. A restraining order was obtained from the Local Court to prevent a repetition.

It was at this stage that Alphonse Soiat briefed Henao Cunningham Lawyers to issue a writ against MOI alleging:

(1)����� numerous breaches by MOI of the Logging and Marketing Agreement,

(2)����� incorrect calculations of the moneys owed to Mamirum Timbers,

(3)����� Letter of Credit was in the name of MOI instead of Mamirum Timbers,

(4)����� failure by MOI to furnish reports require under the agreement, and

(5)����� failure by MOI to keep proper records to allow access to such records.

The writ was issued in August 1987 in the name of Mamirum Timbers Pty Ltd though commencement of proceedings had not been approved by the Board. Henao Cunningham also sought and obtained an interim injunction which restrained MOI from:

(1)����� further breaching certain conditions of the Logging and Marketing Agreement,

(2)����� continuing logging operations,

(3)����� removing or otherwise dealing with any timber products, and

(4)����� performance of any further obligations under the Logging and Marketing Agreement.

On 26 August, this injunction was varied to permit logs lying on the ground to be exported on terms that the sale proceeds, less export duty, were paid into Court. The order was further varied to allow the sale proceeds to be dealt with upon terms that a sum of K11,411.28 was paid into Court. In obedience to the varied order the sum of K11,411.28 received by MOI from the second shipment in September 1987 was then paid into Court.

At this stage MOI was in a desperate situation with another log shipment expected soon and yet the urgently needed funds from the second shipment were frozen in the bank by the National Court Order. The pressure on MOI to renegotiate the Logging and Marketing Agreement and to begin to honour the terms of Mamirum Timbers� permit conditions was now at its highest. On 25 August 1987, Company Secretary Sigulogo, however, (without Board approval) purported to instruct Henao Cunningham by a telex sent on Sia�s telex machine, to discontinue the Court proceeding. He joined with Kusak to have Alphonse Soiat removed from the position of Chairman and he was replaced. The newly constituted Board, immediately after Soiat�s removal, also instructed Henao Cunningham to discontinue the National Court action. Notice of discontinuance was filed on 6 October 1987. The sum of over K11,000 however was retained in Court under the terms of the Court Order but MOI bad been �saved� by the release of the balance proceeds of the second shipment.�

We now turn from the Report of the Barnett Commission of Inquiry and proceed with our own discussion of the charges and the evidence.

THE TRIP TO SINGAPORE

Mr and Mrs Sigulogo travelled with Mr Francis Sia to Singapore on 16 September 1987 and returned on 23 September. Their trip was funded by Mr Francis Sia. We consider that this trip was a pay-off for lifting the injunction preventing the shipment of the second load of logs imposed at the behest of Alphonse Marius Soiat, and ousting Soiat, who was hostile to MOI, from the chairmanship of Mamirum Timbers. We consider that a second reason for this trip, and in particular for the spending money of K2,000 given to Mr Sigulogo, was a contribution towards his electoral expenses. We have noted earlier how, shortly after being elected to Parliament, Mr Sigulogo wrote (on 24 July 1987) to Sia requesting a payment towards his election expenses of K2,960. Mr Sia replied in a typed letter dated 27 July saying that he was willing to assist him with K2,000 after the coming shipment of logs. We consider that in giving Mr Sigulogo the exact sum of K2,000 in Singapore, Sia was honouring his promise made in that letter and also thanking Sigulogo for his help in lifting the National Court injunction which prevented the shipment of the second lot of logs and which eventually resulted in a payment to MOI of K413,330.94.

In coming to our view of the reasons for the Singapore trip we have considered Mr Sigulogo�s explanation given in a letter to the Ombudsman Commission dated 19 November 1987. In that letter he said his reasons for travel were twofold:

N2>�1.����� The contractor�s appreciation of my work of ensuring the landowners of the Mamirum Timber Rights Purchase and his company were able to get off the logging operations after seven years delay.

N2>2.������ The trip was educational for me personally to look at some of the developments in Singapore and Thailand.�

By way of explanation here, whilst in Singapore Mr Sigulogo made a two-day trip to Thailand by himself, that is, without his wife. He says he paid for that trip himself, which probably means that he paid for it out of the K2,000 spending money which he was given in Singapore. We do not agree entirely with the first reason given. We consider that Mr Sigulogo had been paid adequately for his prior work as Company Secretary of Mamirum Timbers when he received K5,911 out of the proceeds of the first shipment in May 1987. We consider that payment covered him for all work he had done on the company�s behalf in the past. We consider that the free trip to Singapore given in September 1987 was more specifically a thank you for having supported Sia and MOI against Soiat in late August 1987 and thus ensuring that the second shipment got away and smoothing the way for future logging to continue.

The four charges relating to the trip to Singapore were laid under s 12(1) of the Organic Law. We quote that section and also s 12(3) which is also relevant:

N2>�12.��� Acceptance, etc., of loans, etc

(1)����� Subject to Subsection (2), a person to whom this Law applies who, or whose spouse or child under voting age:

(a)����� accepts any loan of moneys; or

(b)����� holds any franchise; or

(c)����� accepts any gift or other benefit or advantage,

from a person (including an unincorporated profit-seeking organization) or a foreign enterprise is guilty of misconduct in office.

...

(3)����� The Ombudsman Commission may, by instrument in writing, either absolutely or subject to such terms and conditions as are specified in the notice, exempt a person or a class of persons from any liability under Subsection (1) where, in its deliberate judgment, it is reasonable to do so having regard to the purposes for which the loan, franchise or other benefit or advantage was obtained.�

Mr Sigulogo did not obtain an exemption from the Ombudsman Commission as provided for in s 12(3) either before or after the trip, he has pleaded guilty to the charges, and the evidence and plea support them, and we find him guilty of those four offences.

THE LETTER REQUESTING K30,000 FROM FRANCIS SIA

Mr Sigulogo admits writing a letter to Francis Sia on 5 October 1987. The letter was hand-written by Mr Sigulogo but we reproduced it in typed form and have taken the liberty of numbering the paragraphs:

�C/o P O Box 130

Kavieng

New Ireland Province

PNG

5-10-87

Mr Francis Sia

Malaysian Overseas Investment P.L.

P O Box 236

KAVIENG, NEW IRELAND PROVINCE.

Dear Mr Sia,

N2>1.������ Firstly I would like to thank you and your wife for the privilege you have given me to travel to see Singapore. Then I had the golden chance of having to go up to Thailand again. Very grateful indeed for the fine opportunity.

N2>2.������ As I discussed in detail with you about the project at Mamirum and I assured you that you�ll continue to operate as long as I am a member of the Parliament.

N2>3.������ The only problem I have which is quite serious in my own personal involvement with the company is that as from November 30th 1987, the little money I get from the Mamirum Timber P/L will cease. This is to avoid being caught by the Leadership requirements as a member of Parliament.

N2>4.������ I would like to leave a proposal with you for consideration. If it is possible to look at some kind of payment for me out of your administrative fund. As you know Francis, I have to have some incentives to put my weight behind the operation and at least I know I�m getting something out of it. Therefore I would like to propose that you make provision for me for about K30,000 to be payable at K3,000 each shipment. This looks quite a lot but comparing the amount of work put in during the recent court case, I would have made more during those two weeks.

N2>5.������ Please consider it and do discuss it with me.

N2>6.������ Once again, thank you for the trip and every assistance you�ve given me. Anyway, my wife is very grateful for the watch you�ve bought for her. She thanks you very much for it.

With thanks,

Gerard Sigulogo.�

We need to say a little more about the background to this letter. Paragraph 3 refers to the fact that his involvement in the company will cease from 30 November 1987, which is a reference to the fact that at a meeting of the directors of Mamirum held on 27 August 1987, which was the meeting which ousted Soiat, Mr Sigulogo gave notice that he would resign as secretary from the company on 30 November 1987. That resignation was never notified to the Registrar of Companies and to this day Mr Sigulogo is shown in the Registrar�s records as the secretary of the company.

Paragraph 6 contains a thank you for the watch bought by Sia for Mr Sigulogo�s wife. This was a gold watch given to her in Singapore which we sighted. It was the subject of a charge referred to us. However, under s 12(4) of the Organic Law, the Ombudsman Commission is empowered to publish guidelines specifying the terms and conditions in which a leader can be exempt from having to declare certain gifts. Under those terms and conditions a gift valued at less than K100 is exempt and the prosecution was unable to establish that this watch was worth more than K100 and hence that charge was withdrawn.

We consider that par 2 and par 4 of this letter are an offer by Mr Sigulogo to continue to support Mr Sia and his operations at Mamirum in the future. It is true that in the second part of par 4 there is a reference to past assistance but that is by way of comparison. Mr Sigulogo in his evidence to us gave an example of the kind of help he could be expected to give. He said that after writing that letter he had a telephone call from Sia asking him to talk to the Minister about a timber rights purchase in Central New Ireland. Sia was keen to get this area but was in conflict with another Malaysian company and he asked Mr Sigulogo to talk to the Minister about it but Mr Sigulogo refused as he did not want to help Sia after October 1987. He did not want to help Sia after he received a letter from the Ombudsman Commission investigating his affairs.

Mr Sigulogo�s explanation of the letter in his own words is as follows:

�������� �It was intended as a proposal to Sia and MOI to discuss the matter back with me.�

�������� �I knew from the beginning that he would not give me the K30,000 when I wrote it�� (witness smiles).

�������� �I never followed the letter up. I never asked him again.�

�������� �It was not my intention to get serious. I did not think he would be able to pay me any money. He had a lot of capital expenditure.�

�������� �When I used the words �put my weight behind it� I was referring to my weight as a landowner not as a member of Parliament.�

N2>Q.������ �Did you intend the promise in par 2 to be taken seriously?�

N2>A.������ �Not necessarily. We have never had any more relationship with him. I did not mean that it would be wholly serious. This proposal was meant as a proposal. The proposal was to ask him and it was up to him whether he accepted it or not.�

N2>Q.������ Re par 4 �It was a proposal. You were serious in putting the proposition to him?�

N2>A.������ �I don�t know what you mean by serious. Not serious. I knew very well that he will not consider it.�

N2>Q.������ �Why put it to him?�

N2>A.������ �If you want to get something, you put a proposal.�

We reject these explanations by Mr Sigulogo as unlikely and implausible. We were not impressed by him as a witness. He told a number of lies throughout his testimony to us and explained them away by saying that ��it slipped his mind�. For example, he was asked if he received any payment from the first shipment of logs and he said he got about K500. He was asked if it was a lump sum payment and he said �No�. He was then asked if it was K5,911 and he said �It could be in that vicinity�. We accept the evidence that he did get K5,911 out of the first shipment and we do not think that this sum slipped his mind. He was asked if he had ever asked Sia for money prior to the letter of 5 October and he said �No� but when his attention was drawn to the letter of 24 July 1987 requesting K2,960 election expenses, he corrected himself. He was asked if he had ever submitted a Leadership Code statement prior to the one in issue in this case which was submitted in November 1987. He said �No�, but when his attention was drawn to the years 1980-1981 when he was a member of the Fiscal Commission, he denied ever having submitted a Leadership Code statement at that time. Eventually when the statement was produced to him, his memory recovered. We reject his explanations of this letter as implausible.

We consider the letter means what it says, that it was a request for K30,000 so that Mr Sigulogo would continue to put his weight as a Member of Parliament behind the logging operation. It was a proposal in the sense that we are sure Mr Sigulogo would have been willing to have accepted less than K30,000. We consider that it was a very serious and genuine proposal. We note that although Sia started off with borrowed capital and had big debts, nevertheless the first shipment produced K284,236 and the second shipment produced K413,330 and other shipments also produced large sums. There is no doubt in our mind that if the shipments could continue, there would be adequate funds left over from the miserly payments that were going to Mamirum Timbers to pay Mr Sigulogo K3,000 per shipment if Sia wanted to. After all, he had paid Mr Sigulogo K5,911 from the first shipment, and he had given him a trip to Singapore to the value of about K3,700 which was undoubtedly paid for out of the proceeds of the second shipment. That amount has been calculated by adding up the air fares, hotel bill, spending money and safari suits. Also it is crystal clear from the Barnett Report that Sia was a thoroughly dishonest man and quite capable of making illegal payments to anyone from the Minister for Forests downwards if it suited his purposes. We note that this was a letter never intended to be discovered. It was hand-written and it was only the unusual circumstance of a search raid being conducted on Mr Sia�s office by the police which discovered it. We see this letter as a very serious and realistic attempt by Mr Sigulogo to offer to support Sia and MOI in the Mamirum area and generally in New Ireland in the future in consideration of payments to him totalling K30,000.

THE CHARGES RELATING TO THE LETTER OF 5 OCTOBER 1987

The Public Prosecutor, in his zeal, has proferred four charges against Mr Sigulogo arising out of this one letter. The charges overlap in that they are very similar in content. The first charge is laid under s 5 of the Organic Law on Duties and Responsibilities of Leadership which reads as follows:

N2>�5.����� Use of office for personal benefit, etc

(1)����� A person to whom this Law applies who, except as specifically authorized by law, directly or indirectly asks for or accepts, on behalf of himself or an associate, any benefit in relation to any action (past, present or future) in the course of his duties, or in the course of or by reason of his official position, is guilty of misconduct in office.

(2)����� Subsection (1) extends to the case of a person to whom this Law applies who, except in the course of and for the purpose of his official duties or his official position, uses or allows his name or his official position to be used for the benefit of himself or any other person.�

We consider that in writing this letter, Mr Sigulogo, who was a leader by virtue of being a Member of Parliament (see s 26 of the Constitution):

�... directly... asked for... a benefit in relation to any action (... present or future)... in the course of his duties or by reason of his official position...�

He was not authorised by law to ask for that benefit and we therefore find him guilty of that offence of using his office for personal benefit.

The second charge is laid under s 11 of the Organic Law which provides:

N2>�11.��� Acceptance etc., of bribes

A person to whom this Law applies who, or any of whose associates, corruptly asks for, receives or obtains, or agrees or attempts to receive or obtain, any property, benefit or favour of any kind for himself or any other person in consideration of his actions as a public official being influenced in any manner, or on account of his having acted as a public official in any manner (whether generally or in a particular case) is guilty of misconduct in office.�

On our interpretation of the letter, Mr Sigulogo asked for property or benefit to the value of K30,000 for himself and in return his actions as a Member of Parliament would be influenced by that payment. His lawyer argued before us, however, that he did not �corruptly� ask for that benefit. Mr Yagi for Mr Sigulogo cited to us a direction given by the recorder in London which was approved by the Court of Appeal in R v Wellburn (1979) 69 Cr App R 254 at 264:

� �Corruptly� is a simple English adverb and I am not going to explain it to you except to say that it does not mean dishonestly. It is a different word. It means purposefully doing an act which the law forbids as tending to corrupt.�

Accepting the definition, we consider that Mr Sigulogo wrote this letter corruptly. We note in par 3 that he resigned as Secretary of Mamirum Timbers Pty Ltd in order to �avoid being caught by the Leadership requirements as a member of Parliament�. We consider that this letter was written in the same spirit, namely, to continue to gain benefits from the logging but without being caught by the Leadership Code provisions. We convict him of this offence.

The third charge has been laid under s 27(1)(c) of the Constitution and the fourth charge has been laid under s 27(2) of the Constitution and it is convenient to quote both subsections:

N2>�27.��� Responsibilities of office

(1)����� A person to whom this Division applies has a duty to conduct himself in such a way, both in his public or official life and his private life, and in his associations with other persons, as not:

(a)����� to place himself in a position in which he has or could have a conflict of interests or might be compromised when discharging his public or official duties; or

(b)����� to demean his office or position; or

(c)����� to allow his public or official integrity, or his personal integrity, to be called into question; or

(d)����� to endanger or diminish respect for and confidence in the integrity of government in Papua New Guinea.

(2)����� In particular, a person to whom this Division applies shall not use his office for personal gain or enter into any transaction or engage in any enterprise or activity that might be expected to give rise to doubt in the public mind as to whether he is carrying out or has carried out the duty imposed by Subsection (1).�

In relation to s 27(1)(c), we consider that Mr Sigulogo, in writing that letter, conducted himself in such a way as to allow his official integrity to be called into question and we convict him of that offence.

In relation to the fourth charge, we note the words of s 27(2): �shall not use his office for personal gain ...�. We consider that that offence is only proved if the leader actually uses his office for personal gain. In writing this letter, Mr Sigulogo attempted to use his office for personal gain. We consider that an attempt is not covered by the section and we find him not guilty of the fourth charge.

STATEMENT OF INCOME, ASSETS AND LIABILITIES

Under s 4 of the Organic Law every leader, and this includes a Member of Parliament, is required to file a statement of assets, income, liabilities and debts etc. to the Ombudsman Commission within three months after becoming a leader. The statement must relate back to the previous twelve months. If the leader files such a statement promptly it would only relate to a three-month period when he was a leader and a nine-month period when he was not a leader. Nevertheless, that is what the section requires and we assume that it is worded like that to give the Ombudsman Commission a statement of the person�s assets and liabilities before becoming a leader which can later be compared with his assets and liabilities when he is a leader. Thus Mr Sigulogo was required to file a statement and he was asked to file it for the period 5 August 1986 to 4 August 1987. He did file that statement, after having been chased up by the Ombudsman Commission, on 25 November 1987, and it has been produced to us. The charge alleges that the statement is false, misleading or incomplete and, in particular, to us, it is alleged that it is misleading and/or incomplete in that it fails to reveal that he owed K1,080 rent to Marget Tomadek for renting Mr Tomadek�s house in Kavieng. This omission by Mr Sigulogo is admitted but his lawyer has argued that it was an oversight and that the omission was not made �knowingly, recklessly or negligently�. The offence is found in s 4(6)(b) of the Organic Law which reads as follows:

N2>�(6)��� A person to whom this law applies who:

(a)����� ...; or

(b)����� knowingly, recklessly or negligently gives such a statement or explanation, or any such details, that is or are false, misleading or incomplete in a material particular,

is guilty of misconduct in office.�

The background to this charge is as follows. The house in question was a government house sold to Mr Tomadek who was, and is, a public servant. He rented it out under an oral agreement to Mr Sigulogo in March 1987 at K120 per fortnight. On 10 March 1987, Mr Sigulogo paid K240, the rent for the first month. He then failed to pay any further rent until 18 November 1987 when he deposited K120. That deposit was paid seven days prior to signing his statement of assets and liabilities. Mr Tomadek is a public servant based in Wabag and he wrote two respectful letters to Mr Sigulogo to PO Box 130, Kavieng, which is the box number used by Mr Sigulogo when he wrote his letter of 5 October 1987 to Mr Sia. In Mr Tomadek�s first letter dated 17 September 1987, he said:

�Your position has now made it difficult to contact you on a regular basis on rental payment. You promised me while in Port Moresby some weeks ago that you had the money and are in the process of paying it into my account in Kavieng � Westpac Bank. However, to date you have not made a single payment apart from the first payment in February/March this year. Please note that you are in arrears for the period April to September. You have also failed to honour our agreement which is more depressing to me. Can you make an attempt to pay the arrears now please?

Thank you,

Your brother,

Marget B Tomadek�

The second letter is a long letter of 26 October 1987 sent to Mr Sigulogo at PO Box 130 saying that the outstanding rentals totalled K1,500.

In evidence to us, Mr Sigulogo admitted that he owed the money, but said it had slipped his mind when he completed his statement of assets to the Ombudsman Commission. He said that Mr Roger Dixon was Mr Tomadek�s agent and had asked him on two occasions to pay up the outstanding rent. He said that the letter from Mr Tomadek came when he was busy with Parliament and so the matter did not come into his mind when he completed his Leadership Code statement. �I would have declared it if I had remembered it.�

We were not impressed by this explanation. Two letters were sent to him reminding him � on 17 September and 26 October. He admits receiving at least one of those letters. The letter which we have quoted refers to a promise made in Port Moresby some weeks ago. We assume that Mr Tomadek saw or phoned Mr Sigulogo in Port Moresby reminding him of the debt. Also Mr Sigulogo said that Roger Dixon asked him twice to pay up the arrears and we note that a payment of K120 was made into Mr Tomadek�s account just seven days before Mr Sigulogo signed his statement of 25 November. We are inclined to think that Mr Sigulogo dishonestly and deliberately omitted to mention his debt, although we can see no good reason why he would do so.

We are strengthened in this view by the fact that his Leadership Code statement contains two other omissions of much greater importance. Clauses 11 and 12 of the statement require the leader to state his involvement in any profit-seeking organisation �such as ... private or proprietary companies ... in which you ... hold any position or had any interest such as director ... secretary ...�. In giving a �NIL� answer to those two clauses, Mr Sigulogo failed to state that he was the Secretary of Mamirum Timbers Pty Ltd and we remind ourselves that the statement covered the period August 1986 to August 1987 and that he did not resign from the position of Secretary until 30 November 1987. Also cl 9 of the statement requires the leader to give details of all income received in the year covered by the statement. Under that heading Mr Sigulogo revealed his salary of K548 per fortnight gross as a Member of Parliament but failed to reveal the fact that he had received a payment of K5,911 from MOI in May 1987. In each of these cases Mr Sigulogo said that the matter slipped his mind. We do not believe that. We consider they were deliberate omissions. The whole statement is not detailed. Mr Sigulogo was not involved in any other company or any other business. His financial affairs were very simple yet he failed to mention the one company position which he held and the one substantial amount of income which he got in that year apart from his parliamentary salary. The Prosecutor has not particularised these omissions which he could have done. He could have made them the subject of separate charges and we do not want to make too much of them. Suffice it to say they go to Mr Sigulogo�s discredit and we do not believe that his failure to mention the rent owing to Tomadek was a simple case of forgetfulness. We consider that, for whatever reason, he decided to tell the Ombudsman Commission as little as he possibly could about his financial and business affairs. We are satisfied that he failed to reveal the rent owing �knowingly� or, at least, �negligently� and that, in so doing, the statement which he gave was �false, misleading [and] incomplete in a material particular� and we find him guilty of this charge.

PUNISHMENT

The punishments open to us are set out in s 28 of the Constitution and we note that that section has been amended by Constitutional Amendment No 4, and they are further set out in the Leadership Code (Alternative Penalties) Act (Ch No 1A) which was an Act passed to implement s 28(1A) of the Constitution and s 27(5)(b) of the Organic Law. The punishments open to us are:

N2>(a)����� A recommendation to the Head of State that the leader be dismissed from office (s 28(1)(g)(ii) of the Constitution).

If we find that there has been no serious culpability on the part of the person found guilty of misconduct in office and the public policy and public good do not require dismissal, we may recommend under s 28(1A) of the Constitution and the Leadership Code (Alternative Penalties) Act to the Head of State that one of the following lesser penalties be imposed:

N2>(b)����� A fine in an amount not exceeding K1,000.

N2>(c)����� An order that the leader enter into his own recognisance in a reasonable amount not exceeding K500 etc.

N2>(d)����� Be suspended, without pay, from his position for a period not exceeding three months from the date of his suspension.

N2>(e)����� Be reprimanded.

N2>(f)����� In certain cases be reduced in salary.

N2>(g)����� In certain cases be demoted in his employment.

(The latter six punishments come from s 2 of the Leadership Code (Alternative Penalties) Act (Ch No 1A).)

In relation to the four charges relating to the trip to Singapore in September 1987, we consider that these charges overlap. That is, the first charge for the value of the air tickets K1,357, the second for the spending money K2,000, the third for the three safari suits valued at 300 Singapore dollars, and the fourth for the cost of hotel accommodation K182.73. All charges are laid under s 23(1) of the Organic Law and they could have been contained in the one statement of charge. We consider that the appropriate overall penalty is a fine of K1,000 in default of four months imprisonment but as the charges have been separately laid we impose a fine of K250 in respect of each charge, in default one month�s imprisonment cumulatively on each charge. We give Mr Sigulogo two months to pay the fine. The fine is to be paid to the National Court, Waigani.

With respect to the charge of knowingly making a false, misleading or incomplete statement to the Ombudsman Commission under s 4(6)(b) of the Organic Law, we consider the appropriate penalty is a fine of K200 in default one month�s imprisonment with hard labour. We give Mr Sigulogo two months to pay this fine. The fine is to be paid to the National Court, Waigani.

We have found Mr Sigulogo guilty of three charges of misconduct in office in relation to the letter to Mr Sia requesting K30,000. We consider Mr Sigulogo�s culpability was very serious in writing that letter and that public policy and the public good demand a severe penalty. A Member of Parliament is paid a salary and allowances and should be expected to perform his duties as an MP without soliciting payments from anyone, let alone soliciting secret payments from a foreigner. We have considered the character reference supplied by Pastor Piuki Tasa of the Seventh Day Adventist Church, that Mr Sigulogo attends church services regularly, is of good standing in the Church, serves on its highest committee (the Papua New Guinean Union Mission Executive), and is a good family man. In our view, these fine personal qualities are outweighed by the seriousness of the misconduct in office proved against him. His good church standing and family life cannot save him, in our view, from the appropriate punishment. We are judging him on his public life, not on the quality of his private life. We consider it appropriate that Mr Sigulogo should be dismissed from office and we recommend his dismissal on each of those three charges. We recommend his dismissal under s 28(1)(g)(ii) of the Constitution to His Excellency the Governor-General and we point out that, under s 28(2) of the Constitution, His Excellency is required to act on that recommendation. This will mean that Mr Sigulogo will continue to be suspended from Parliament on full pay, as he has been under s 28 of the Organic Law from the time of appointment of our Tribunal, until His Excellency signs the dismissal notice.

Orders accordingly.

Lawyer for the Public Prosecutor: V V Noka, Acting Public Prosecutor.

Lawyer for Mr Sigulogo: J Yagi.