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Somare v State [2007] PGNC 34; N3139 (1 June 2007)

N3139


PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]


OS 94 OF 2006 (JR)


BETWEEN:


RT. HON. SIR MICHAEL T. SOMARE GCMG CH MP,
PRIME MINISTER AND CHAIRMAN,
NATIONAL EXECUTIVE COUNCIL
First Plaintiff


AND:


THE INDEPENDENT STATE
OF PAPUA NEW GUINEA
Second Plaintiff


AND:


THE NATIONAL EXECUTIVE COUNCIL
Third Plaintiff


AND:


ILA GENO, CHIEF OMBUDSMAN, PETER MASI
AND JOHN NERO, OMBUDSMAN
Defendants


Waigani: Salika, J
2007: 1 June,


CONSTITUTIONAL LAW – Organic Law on Duties & Responsibilities of leadership on Ombudsman Commission Jurisdiction to issue directions to various Ministers, Officers and Offices – directions to comply with Public Finance Management Act and Financial Instructions on whether the directions issued were for attainment of objects of the Leadership Code – Section 27(4) of Constitution


Counsel:


Mr L Kandi, for first and second Plaintiffs
Mr L Henao, for the third Plaintiff
Mr N Yalo & Mr E Wilmot, for the Defendants


1 June, 2007


1. SALIKA J: The plaintiffs by these proceedings seek to review certain Directions issued by the Ombudsman Commission on 27 November 2006. The Direction requires certain persons and officers to:-


2. The plaintiffs seek orders in the nature of certiorari to remove to the National Court and quash the Direction made by the Defendant on 27 November, 2006.


The Originating Process
3. In the course of writing this decision I have wondered whether the plaintiffs might have commenced these proceedings under Sections 18 or 19 of the Constitution.


4. I also wonder if the plaintiffs might have sought declarations to declare the Directions unconstitutional.


5. This is because the judicial review function is to ensure that the decision making body’s action is:


(1) authorized by law
(2) fair
(3) not an abuse of its powers
(4) does not infringe upon freedom of private individual, that is, the decision does not encroach upon private individual rights.

6. The judicial review sought in this instance is pursuant to Order 16 of the National Court Rules.


7. Leave was granted for Judicial Review and the matter is before the court for the hearing of the review proper.


Agreed Facts


8. The parties agreed to the following facts:


9. Ombudsman Commission issued a Direction on 27 November, 2006 to:


(5) The Minister for Treasury, and
(6) The Minister for Finance and Planning, and
(7) The Secretary, Department of Finance, and
(8) The Secretary, Department of Treasury, and
(9) The Secretary, Department of National Planning and Monitoring, and
(10) Director, Office of Rural Development, and
(11) All Provincial Administrators, and
(12) All District Administrators, all Provincial Treasurers and all District Treasurers and all officers in the offices referred to in No.s (1) to (7) above.

10. The officials referred to in (1) to (7) above are subject to the Leadership Code.


11. The officials referred to in (8) in the Direction are not subject to the Leadership Code.


12. The funds referred to in the Direction are all public funds and as such, their use is subject to the Public Finance (Management) Act and other relevant financial instructions.


13. All of the officials referred to in the Direction are directly or indirectly entitled to deal with the said public funds.


14. The said public funds have been made available for the fiscal years 2005 and 2006.


15. Some of the said public funds have been released by the Department of Finance to some of the officials referred to in the Direction whilst others are yet to be released.


16. Some of the funds which were released were accounted for whilst others have not been accounted for.


17. In respect of the funds released to various District Treasuries a substantial amount still remains in those district Treasury trust accounts.


18. The Ombudsman Commission has the authority to issue such Directions.


The Issue


19. The issue is whether the direction issued were for the attainment of the objects of the Leadership Code consistent with s.27(4) of the Constitution.


The Law


20. The Leadership Code provisions are contained in the Constitution of Papua New Guinea Sections 26, 27, 28, 29, 30 and 31.


21. The relevant provision for the purpose of discussion in this case is s.27(4) of the Constitution.


22. It is appropriate to state the entire s.27. It reads:


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).


(3) It is the further duty of a person to whom this Division applies—


(a) to ensure, as far as is within his lawful power, that his spouse and children and any other persons for whom he is responsible (whether morally, legally or by usage), including nominees, trustees and agents, do not conduct themselves in a way that might be expected to give rise to doubt in the public mind as to his complying with his duties under this section; and


(b) if necessary, to publicly disassociate himself from any activity or enterprise of any of his associates, or of a person referred to in paragraph


(a), that might be expected to give rise to such a doubt.


(4) The Ombudsman Commission or other authority prescribed for the purpose under Section 28 (further provisions) may, subject to this Division and to any Organic Law made for the purposes of this Division, give directions, either generally or in a particular case, to ensure the attainment of the objects of this section.


(5) A person to whom this Division applies who—


(a) is convicted of an offence in respect of his office or position or in relation to the performance of his functions or duties; or


(b) fails to comply with a direction under Subsection (4) or otherwise fails to carry out the obligations imposed by Subsections (1), (2) and (3),is guilty of misconduct in office".


23. To fully appreciate the directions and this effect, I have taken the liberty to have them reproduced so that the context of the directions can be fully understood and appreciated.


The Directions


24. The Directions are:


DIRECTION BY THE OMBUDSMAN COMMISSION


TO:
(1) The Minister for Treasury; and

(2). The Minister for Finance and Planning; and

(3) The Secretary, Department of Finance; and

(4) The Secretary, Department of Treasury; and

(5) The Secretary, Department of National Planning and Monitoring; and

(6) Director, Office of Rural Development; and

(7) All Provincial Administrators; and

(8) All District Administrators, all Provincial Treasurers and all district Treasurers and all Officers in the Offices referred to in NO’s (1) – (7) above.

........
Whereas the 2007 general election to the Parliament is imminent and the Ombudsman Commission has obtained information giving rise to serious concerns as to the release, disbursement, transfer and receipt of pubic money purporting to be in the form of electoral and discretionary funds and various development funds under District Services Improvement program, but not limited to:


(13) District Roads Improvement program (DRIP) and or district Transport Infrastructure Improvement Program (DTIIP and or District Transport Infrastructure Program (DTIP); and
(14) District Education Improvement Program; and
(15) District health Improvement Program; and
(16) District Law and Justice; and
(17) District Water Supply;
(18)

For the fiscal years 2005 and 2006; and


Whereas the distribution of substantial public funds to the District Treasuries and the Provincial Treasurers in such a time when the 2007 general election is imminent and that there is insufficient item for the funds to be properly applied to development purposes as intended and therefore these substantial public funds may be misapplied or misused contrary to law and the relevant guidelines; and


Whereas each of you holding the offices in (1) to (7) above is a person to whom the National Goals and Directive Principles, in particular the second National goal which is for all citizens to have an equal opportunity to participate in and benefit from the development of our country, the Basic Social Obligations in particular the duty to respond and act in the spirit of the constitution and to protect Papua New Guinea and to safeguard the national wealth, and division III.2 (leadership code) of the constitution apply; and
.
Whereas each of you holding the offices in (8) above is a person to whom the National Goals and Directive Principles and the Basic social Obligation, in particular the duty to act in the spirit of the Constitution, apply; and,


Whereas it is the duty of all government bodies to apply and give effect to the National Goals and Directive Principles and to encourage compliance with the Basic social Obligations as far as lies within their respective powers; and


Whereas each of you holding an office in (1) to (7) above is subject to Section 27 of the Constitution and accordingly:


(1) you have a duty to conduct yourself in such a way, both in your public or official life and your private life and in your associations with other persons, as not;

(2) you have a duty, in particular, not to 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 you are carrying out or have carried out the duties imposed by Section 27(1) of the Constitution, and

(3) you have a further duty if necessary to publicly disassociate yourself from any activity or enterprise of any of your associates that might be expected to give rise to such a doubt; and

Whereas each of you in (1) to (7) above has a duty under Section 23 of the Organic law on the Duties and Responsibilities of Leadership to not obstruct the Ombudsman Commission and to cooperate to the best of your ability with the Ombudsman Commission in any investigation or other proceedings for the purpose of that Law; and


Whereas the Ombudsman Commission is conducting investigations under the Leadership Code and the Organic law on the Duties and Responsibilities of Leadership relating to suspected misconduct in office by persons to whom that Law applies in relation to the circumstances surrounding the release, disbursement, transfer and receipt of public money purporting to be in the form of electoral and discretionary funds and various development funds under District Services Improvement Program and/or the district Roads Improvement Programs, but not limited to those various funds referred to on page 1-2 of this Direction in respect of the fiscal years 2005 and 2006; and


Whereas the Ombudsman Commission has determined that it is necessary to do so in this particular case, for the purpose of ensuring the attainment of the objects of Section 27 of the constitution and in particular protecting the integrity of leaders who are involved in these matters.


Each of you is hereby directed pursuant to Section 27(4) of the Constitution to:


  1. Stop the Release, disbursement, Transfer and/or Receipt of Public Money purporting to be in the form of Electoral and Discretionary Funds for the Fiscal years 2005 and 2006; and in particular
  2. Stop payment of all Cheques or Warrants dated on or after 1st January, 2005 drawn on any Bank in Papua New Guinea including the Bank of Papua New Guinea by or on behalf of the Government of Papua New Guinea in respect of Public Money purporting to be in the form of Electoral and Discretionary Funds and various Development Funds under District Services Improvement Program, but not limited to:

For the Fiscal years 2005 and/0r 2006, and


(3) Transfer to the Consolidated Revenue Fund at the end of the 2006 fiscal year, all public funds in respect of the various Programs referred to above that are not committed to the relevant Projects.

Unless and Until:


(a) the release, disbursement, transfer and/or receipt of the payment of such public money, cheque or warrant complies with the Public finance (Management) Act, Financial Instruction No 2 of 2005 dated 9th June, 2005 and Financial Instruction No 01/2006 dated 7th August, 2006 or any relevant Financial instruction and the relevant guidelines that relate to each of the respective programs referred to above in particular, but not limited, to:

And Take Notice


(a) that this direction takes effect immediately; and

(b) that if any of the person in (1) to (7) above fails to comply with this direction he or she will be guilty of misconduct in officer under Section 27(5)(b) of the Constitution and liable to prosecute before a leadership tribunal and subject to penalties under Section 28(1)(g)(ii) of the Constitution, Section 27(5) of the Organic Law on the Duties and Responsibilities and Section 2 of the Leadership Code (Alternative Penalties) Act, including dismissal from office; and

(c) if any of the person described in (8) above fails to comply with this direction he or she may be subject to enforcement proceedings in the National Court under Section 23 of the Constitution".

25. The Directions in this matter, the subject of the proceedings were gazetted on the National Gazette No G13 on 31 January, 2007.


26. The direction is to all those named in paragraph 9 of this decision.


27. It is to be particularly noted that the direction is not to the First Plaintiff, the second Plaintiff and/or the Third Plaintiff.


28. From the reading of the Direction, it seems to me that they were issued, not only to protect the funds from being abused or misapplied but in my respectful view, to also protect those who have access to those funds who must first comply with the Public Finance (Management) Act and Financial Instructions issued by the relevant authorities, before those funds can be released.


29. In other words the funds sought to be released, disbursed, transferred or paid must be according to law and follow proper financial procedures.


30. That to me is the thrust and effect of the directions.


Standing of Plaintiff.


31. I have commented already that the Directions were to named persons and offices they held and officers working in those offices.


32. The Direction is not to the Prime Minister, the Independent State of Papua New Guinea, and or the National Executive Council.


33. While I am mindful of the fact that leave has been granted to the plaintiffs to seek a judicial review, I raise the question here:- Review what decision of the Defendant?


34. The Defendant made a decision to issue certain directions.


35. Are the plaintiffs seeking to review that decision to issue the Direction or are they challenging the validity of the direction themselves?


36. On the face of it they are challenging the Directions and its validity but not the decision to issue the Directions and perhaps their application to the persons and officers named.


37. I take it then that the plaintiffs are challenging the validity of the directions.


38. The question remains as to the plaintiff’s standing to seek judicial review when the direction is not to them individually, personally or collectively.


39. How does the direction affect them? There is no evidence before the court by the Prime Minister and Chairman of the National Executive Council, how he is affected by the Direction and, if he has been deprived of the funds because of the Directions.


40. There is no evidence from any of the members of the National Executive Council how anyone of them has been affected by the directions and how they have been deprived of the funds as a result of the Directions.


41. The Minister for Treasury and the Minister for Finance and Planning have not complained of the directions. If any one should be aggrieved from the National Executive Council ranks it would be the two Ministers. But they have not complained about the direction nor, is there any evidence they are not happy with the Directions.


42. They have not complained and they are not making any application to review the Directions of the Defendant.


43. Moreover, the plaintiffs do not handle the various categories of funds, that the Direction relate to. The funds are handled by the persons named in the directions.


44. The plaintiffs duty and concern, if anything, should be the same as the Defendants, and that is to ensure that Members of Parliament comply with the Public Finance (Management) Act and the various financial instructions that have been issued. There must be a concerted effort from the leaders with the Defendant. There must, not only be a political will, but political support for not only financial management but also good governance.


45. The plaintiffs are not restrained, prohibited or barred from accessing the funds. They are at liberty to have access to the funds.


46. There is no cause for them to be alarmed by the directions. The Directions are to assist the plaintiffs, not to put themselves in a position of conflict with the Public Finance (Management) Act and the various Financial Instructions.


47. If the plaintiffs took no heed of the Direction and did not comply with the laws to access the funds, they could subject themselves to possible prosecution either under the Criminal Law or under the Leadership Code.


48. For all the foregoing reasons, I find that while the plaintiffs have sufficient interest, they have not demonstrated to the Court that the Directions affect their individual or collective rights adversely such that the Directions should be quashed.


49. In reality the Directions should help them. How one might ask? The Directions serve as reminders to the plaintiffs and Members of Parliament and other leaders and helps to maintain their integrity and standing.


Are the Directions to ensure attainment of the Objects of the Leadership Code.


50. The plaintiffs argued that the Directions are not to persons covered under the Leadership Code. They argued that the offices and officers under Item 8 in the Directions are not subject to the Leadership Code, and as such how can the Direction be seen to enable the attainment of the objects of the Leadership Code.


51. It is true that the officer and officers under Item 8 of the Directions are not subject to the Leadership Code but the point is these offices and officers handle the funds. The funds are with them. A person, including the plaintiffs and others, be they subject to the Leadership Code or not, must go to them to access funds for developmental projects in their electorates.


52. These offices and officers must ensure those who want to access funds must comply with the Public Finance (Management) Act and the financial Instructions.


53. If they do not they will be in breach of the laws, and where leaders are involved, breach of the Leadership Code as well.


54. I refer to a classical example in today’s National Newspaper, that is Friday 1 June Edition. The headline reads:- "TANTRUM IN ORD OFFICE, MP GOES BESERK OVER ELECTORAL FUNDS.


"A member of Parliament went on the rampage yesterday in a Government Office at Waigani after he was told he could not get his electoral funds because he had not acquitted the funds previously released to him".


The MP allegedly destroyed a printer and threatened to kill a senior officer of the Office of Rural Development over his 2007 electoral funds..."


55. This is the exact example of the abuse of the laws the Directions are intended for.
56. The Member of Parliament in this example is a person to which the Leadership Code applies to. The member has a duty to comply with the Public Finance (Management) Act and the various Financial Instructions.


57. If what is reported in The National is true, the Member of Parliament may have, by his conduct demeaned his office.


58. If he went ahead and accessed the funds without complying with the laws, he may be in breach of not only the Public Finance (Management) Act but also the Leadership Code..


59. If the officer at the Office of Rural Development was a lesser offer to the one who attended to the Member of Parliament, the member might have succeeded in accessing the funds without complying with the Public Finance (Management) Act and the various financial instructions.


60. I was referred to my own decision in the matter of Albert Karo v Ombudsman Commission (Unreported and unnumbered) and dated 29 December, 1994. In that case Albert Karo was the then Member of Parliament for Port Moresby South Open Electorate and then Minister for Works.


He was in the process of or making arrangements to move into a home when the Ombudsman Commission issued directions to the Managing Director of the National Housing Corporation to immediately cease any arrangements for Mr Albert Karo to move into that home. There were allegations of impropriety on the part of Mr Karo to get that house.


61. Mr Karo sought judicial review of the decision of the Ombudsman Commission in giving the Directions arguing that there was no basis for the Ombudsman Commission to issue those Directions.


62. He also sought to have the Directions declared null and void and of no effect on the basis that there was no basis for the Directions.


63. Mr Karo also sought a declaration that the Ombudsman Commission exceeded its jurisdiction in issuing the Direction in that it was outside its statutory powers.


64. In that case I said:-


"I am of the view that the Ombudsman Commission is not inquiring into the justifiability of a policy, rather I find that, it was inquiring into the manner Mr Karo got into the house. That in my view was the concern and the duty of the Ombudsman commission that it had to move in to ensure that the leader was not in breach of the Leadership Code".


65. In that case I found effectively that, the Ombudsman Commission direction, as issued, was within the scope of s.27(4) of the Constitution.


66. The facts in that case are different. The Directions were issued to persons who were also subject to the Leadership Code.


67. The facts here are different and the considerations in this case are different as well.
68. In that case the Directions were declared to have been within the scope of s.27(4) of the Constitution.


69. The question is, are they in this case. The plaintiffs argue that the directions does not serve the purpose of s.27(4), that is to preserve and protect the integrity of persons, instead they submitted that, the Directions taint, and smear the standing of the leaders and demean the integrity of the leaders.
70. The direction in their proper construction is not to the plaintiffs. It does not in any way taint or demean the plaintiffs. It does not call the plaintiff’s integrity into question.


71. The Plaintiffs also submitted that the Directions were issued under s.17 of the Organic Law on the Ombudsman Commission.


72. The National Gazette publication of the direction speaks for itself on this. The Direction was issued under s.27(4) of the Constitution.


73. The plaintiffs also submitted that the direction was issued without any factual or legal basis and that the Direction was speculative and without any investigation reports.


74. The Chief Ombudsman in his affidavit filed on 27 April 2007 gave evidence of a preliminary investigation (see para 10)


75. From Paragraph 12 of the affidavit Mr Geno outlines the results of their preliminary investigations.
76. I am satisfied from the affidavit of Mr Geno that there was an investigation and that the results of the investigations are as stated by him.


77. It is therefore not correct for the plaintiffs to say that there was no basis for the Directions. There is a basis for the Directions and the directions was not a mere speculation.


78. In reality only one out of 109 members of Parliament is complaining about the Direction. It could be 27 or 28 if those in the National Executive Council are to be counted. There is no evidence though from any one of the other members of the National Executive Council that they support this action by their Chairman.


79. Section 27(4) gives wide powers to the Ombudsman Commission to give direction, either generally or in a particular case, to ensure that the objective and purpose of responsibilities of office are attained or the objectives of the Leadership Code are attained.


80. The Direction is not intended, for those who might have accessed the funds already before the Directions were issued. It is directed to the future access to the funds after the Directions were issued.


81. In that regard Direction 3 may not be proper. I strike down direction 3.


82. When s.27(4) of the Constitution says the Ombudsman Commission may issue directives, either "generally or in a particular case, what does that mean? In this case were the directives given "generally or in a particular case". I would say it’s generally because its not about any particular case.


83. In this case, it is open to the court to find that the directions were properly issued under s.27(4) of the Constitution. I add here that the 3rd plaintiffs did concede that the Ombudsman Commission does have the power to issue the directions.


84. I am satisfied that the Directives were issued for the attainment of the objects of s.27(4) of the Constitution which is that a Leader covered under the Leadership Code has a duty not:


(a) to demean his office or position.

(b) to allow his public or official integrity or his personal integrity into question.

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

85. In other words leaders must be responsible and act responsibly when accessing funds from the various sources.


86. In all the circumstances, I dismiss the application by the plaintiff.


87. Indeed, there would be no need for these directions if we all complied with the Public Finance (Management) Act and the various Financial Instructions and if the office and officers tasked with the responsibility of looking after the funds were as tough and true to them as Mr Aihi Vaki reported in today’s National Newspaper.


88. The orders of the Court are that the Directions are valid except for paragraph 3 which talks of "transfer to consolidated revenue..." etc.


89. The interim orders staying the Directions are now removed and are in force.


90. Costs are awarded to the Defendant.


_____________________________________________


Steeles Lawyers: Lawyer for the First and Second Plaintiffs
Henaos Lawyers: Lawyer for the Third Plaintiff
Ombudsman Commission Counsel: Lawyer for the Defendants

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