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Tapkon v Tutuman Development Ltd [2013] PGNC 238; N5090 (4 February 2013)

N5090

PAPUA NEW GUINEA
IN THE NATIONAL COURT OF JUSTICE

W S. NO. 850 OF 2012

BETWEEN:

KEPAS TAPKON in his capacity as Managing Director of RAKUBANA DEVELOPMENT CORPORATION LIMITED
First Plaintiff

AND:

FRANCIS KAKUN in his capacity as Chairman of RAKUBANA DEVELOPMENT CORPORATION LIMITED.
Second Plaintiff

AND:

TUTUMAN DEVELOPMENT LIMITED
Defendant

Kokopo: Lenalia; J.
2012: 7th & 24th December
2013: 4th February

PRACTICE & PROCEDURE –Application to dismiss for disclosing no reasonable cause of action or for being frivolous, vexatious or an abuse of the process of the Court – Order 12 Rule 40(1) National Court Rules.

PRACTICE AND PROCEDURE – Parties to the action – Pleading in the
Writ of Summons – There is no clear indication of what is the nature of this claim – Issue of speculative claim.

PRACTICE AND PROCEDURE – Proceedings dismissed for no reasonable cause of action, so frivolous and vexatious in nature that it should be dismissed.

Case cited

Robinson-v-National Airlines Commission [1983] PNGLR 478
Markscal Ltd-v-MRDC [1996] PNGLR 419.
Ewase Land Owners Association Inc-v-Hargy Oil Palm Ltd (2005) N2878
Ronny Wabia-v-BP Exploration Operating Co. Ltd & 2 Others [1998] PNGLR 8

Counsel

Mr. Motuwe, for the Plaintiffs
Mr. P. Tabuchi, for the Defendant

4th February, 2013

1. LENALIA; J. On 7th December 2012, I dealt with two Notices of Motions on these proceedings. The plaintiffs filed theirs on 24th August 2012. The defendant's lawyers, filed theirs later on 6th of December 2012. I deal with them in order of the dates such motions were filed.

2. The plaintiffs seek restraining orders in the following terms:

1. That pursuant to Order 14 Rule 10(1) of the National Court Rules, the Defendant be restrained from dealing with Portion 871C Formil of Dalamakas, Ratiwis of Namatanai, New Ireland Province referred to also as Danfu Extension in any manner or form including logging either by itself or by engaging third parties.
   
2. That pursuant to Order 14 Rule 10(2) of the Rules, and order be made that all logs that have been felled and all machines used in felling trees on that Portion be detained and held in a safe place till determination of these proceedings.
   
3. That pursuant to Order 14 Rule 10(3) of the Rules, the defendant be ordered to pay into the National Court Trust Account a sum not exceeding two hundred thousand kina (2000,000.00) to offset levy claims, premiums and costs plus mobilization fund.
   
4. Costs of & incidental to these proceedings.
   

3. In the plaintiff's' counsel's submission on their motion, Mr. Motuwe argued that, the defendant company has caused devastative damages to the forests and general environment such that the company ought to be stopped immediately. Counsel referred to the affidavit of Kepas Tapkon filed on 11th October 2012 where the 1st Plaintiff complaints about what damage has been caused by the defendant to the land the subject of a lease agreement.

4. Mr. Tabutchi of counsel for the defendant company replied that, the portion of land is the subject of a lease agreement and whatever dealings takes place within such land should be left until proceedings OS. No. 648 of 2008 has been decided. The defence filed a copy of that OS proceedings that was filed on 20.10.2008. In that Originating Summons, Bernard Uriap is the plaintiff and is not a party on the current case.

5. Interesting as it is, Rakubana Development Corporation Ltd and Tutuman Development Ltd are the 1st and 2nd Defendants in that proceeding while the Registrar of Titles, Raga Kavana and Minister for Lands and Physical Planning are the Third and Fourth Defendants.

Defendant's Notice of Motion

6. By a Notice of filed Motion filed on 6th December 2012, the lawyer for the defendants moved to have the entire proceedings dismissed because they say, the proceedings do not disclose any reasonable cause of action. They seek the following orders:

1. Pursuant to Oder 1 Rule 7, Order 4 Rule 38 and Order 12 Rule 1 of the National Court Rules, the requirement for service of this Notice of Motion be dispensed with.
   
2. Pursuant to Order 12 Rule 40(1) of the National Court Rules, the herein proceedings be dismissed for disclosing no reasonable cause of action, being frivolous and vexatious and being an abuse of the process.
   
3. Pursuant to Order 22 Rule 65 of the National Court Rules, the defendant's costs be on Solicitor/Client basis.
   
4. Any other order this Honourable Court deems fit.
   

History of the case

7. The plaintiffs sues the defendant for damages allegedly caused to Portion 871C Formil Dolomakas Milinch, Namatanai, New Ireland Province. In the statement of claim, the plaintiffs say the defendant is a company incorporated under PNG relevant laws. That agreement was made on 11th November 2005.

8. After that, the defendant applied for T.A 03 agriculture in 2006 and was valid for 12 months. Again on 29th October 2006, the defendant applied for SABL on behalf of Rakubana Development Corporation Limited and was granted a 99 years lease over that portion.

9. On 11th September 2009 the defendant obtained a Forest Cutting Authority license No.16-01. Such license allowed the defendant to clear the forest and plant agricultural crops. The plaintiffs now say that, the defendant had breached the terms of the agreement thereby they now sue for damages.

Submission on the Application for Restraining Orders and on the Application to dismiss

10. Mr. Tabuchi of counsel for the Applicant/Defendant addressed his written submission. The gist of Mr. Tabuchi's argument is that, this action is quite premature on the grounds that, there is another pending proceedings O.S 648 2008 on which Bernard Uriap and Others-v- Rakubana Development Pty Ltd (1st Def) and Tutuman Development Ltd (2nd Def) and Raga Kavana Registrar of Titles (3rd Def). This case according to Mr. Tabutchi is pending counsel argued that this is an abuse of the process of the Court.

11. The second part of his argument relates to the pleading in the Writ saying it is not clear from the pleadings what the actual course of action is. It was further submitted that if the pending proceedings is successful in their judicial review application, then the State Lease will be declared null and void making the sublease between Rakubana Development Ltd and Tutuman Development Ltd defective.

12. Mr. Motowe replied that, the action by the plaintiffs relates to a claim in breach of the terms and conditions of agreement on the lease agreement entered into between the parties. He argued there is a valid contractual agreement and the court should refuse the application to dismiss.

Application of Law

13. On the application by the plaintiff, this Court has discretion under Order 14 Rule 10(1((2) and (3) either to grant or refuse an interlocutory injunction. Order 14 deals with miscellaneous powers of this Court. It states:

"10. Preservation of property. (28/2)

(1) In proceedings concerning any property, or in proceedings in which any question may arise as to any property, the Court may make orders for the detention, custody or preservation of the property.

(2) An order under Sub-rule (1) may authorize any person to enter any land or to do any other thing for the purpose of giving effect to the order.

(3) In proceedings concerning the right of any party to a fund, the Court may order that the fund be paid into Court or otherwise secured."

14. On the same token, the power of this Court to dismiss these proceedings for frivolity is discretionary according to the wording of Order 12 Rule 40(1)(a)(b) and (c) of the National Court Rules. This provision states:

"40. Frivolity, etc. (13/5)

(1). Where in any proceedings it appears to the Court that in relation to the proceedings generally or in relation to any claim for relief in the proceedings—

(a) no reasonable cause of action is disclosed; or

(b) the proceedings are frivolous or vexatious; or

(c) the proceedings are an abuse of the process of the Court, the Court may order that the proceedings be stayed or dismissed generally or in relation to any claim for relief in the proceedings.

(2) The Court may receive evidence on the hearing of an application for an order under Sub-rule (1).

15. It is established law that the test to determine whether a reasonable cause of action is disclosed if it is plain and obvious from the pleadings that the Court can say at first glance that the statement of claim as it stands, is insufficient even if proved to entitle the plaintiff to what he claims for: Odata Limited-v-Ambusa Copra Oil Mill Limited and National Provident Fund Board of Trusties (2001) N2106 see also Hubbuck & Sons Ltd-v-Wilkinson Heywood & Clark Ltd [1899] A11 E.R.244.

16. In the common law case of Grierson-v-The King (1938) CLR 431 the Court there said that where no reasonable cause of action is disclosed if the purported cause of action pleaded is "obviously contestably bad".

17. The above test was adopted and applied in a number of cases in this jurisdiction such as PNG Forest Products Pty Ltd & Inchcape Berhad v The State and Genia [1992] PNGLR.85 and in Ronney Wabia-v-BP Exploration & Ors (1998) N1697.

18. On the application by the plaintiffs, grant of interlocutory injunctions is discretionary and guided by the following principles:

1. Is there a serious question to be tried?
   
2. Does the balance of convenience favour grant of the injunction?
   
3. Will damages be adequate remedy?
   
4. Has the plaintiff given sufficient undertakings as to damages?
   

19. On the first issue, according to case law authorities, there ought to be a serious case to be tried. This involves the possibility of ultimate success: Robinson-v-National Airlines Commission [1983] PNGLR 478, see also Markscal Ltd-v-MRDC [1996] PNGLR 419.

20. More recent cases of Ewase Land Owners Association Inc-v-Hargy Oil Palm Ltd (2005) N2878 or the case of Mango-v-Chow Po Khoon (2005) N2907 establish the same principles which say that if the plaintiff's case is so dubious or untenable such that such case cannot possibly succeed if the matter proceeds to substantive hearing, the injunction should not be granted. (See also Ronny Wabia-v-BP Exploration Operating Co. Ltd & 2 Others [1998] PNGLR 8).

21. On this case, the defendant is saying that the current proceedings would be too premature and it is vexatious because there is an Originating Summons No. 648 of 2008 which has not been completed.

22. The plaintiff may have an arguable case. But the logic of the argument by the defendant's lawyer is that, the current proceedings may be premature because OS.No.648 of 2008 has not been dealt with.

23. In that judicial review application, Bernard Uriap is the plaintiff. He seeks declaratory orders against the four defendants, the plaintiff and defendant on the current case with the Registrar of Titles and Minister for Lands and Physical Planning as Third and Fourth Defendants.

24. Bernard Uriap (plaintiff in the OS proceedings) claims there was breach of s.11 of the 1996 Land Act in granting State Lease Portion 871 C Volume 17 Folio 016 Dolomakas Namatanai, New Ireland Province. This is statutory breach which this Court sitting as it is cannot interpret.

25. I note here that, this is the same portion of land referred to in the Notice of Motion by the plaintiff's lawyer and the pleadings in the Writ of Summons on the current claim. It could be that one of the parties may incorrectly institute the proceedings, either the current one or the OS proceedings.

26. I have read the plaintiff's affidavit and noted the alleged breaches supposedly committed by the defendant company. The proceedings in the Originating Summons create a certain ambiguity as to who is the rightful owner of the portion of land that was leased to the defendant company.

27. What would be the plaintiffs reaction if the court was to grant the orders sought in the application for judicial review and declare the actions of the defendants named in the OS proceedings null and void.

28. I note the pleadings on the copy of OS.No.648 of 2008 in paragraph 1 and 4 where the plaintiffs raise the issue of s.11 the Land Act 1996. That Act deals with acquisition of customary land for the grant of special agricultural and business leases.

29. I note paragraph 1 and 4 of the copy of the OS proceedings that, the plaintiffs in that case raise serious questions about ownership of the land that was declared and whether acquisition was properly acquired. This questions the locus standi of Rakubana Development Corporation Ltd.

30. The earlier OS proceeding has not been determined. I am of the view that, on the current proceedings, the plaintiffs standing is questionable as to their standing particularly RAKUBANA DEVELOPMENT CORPORATION LTD. This raises the issue of whether there is a serious question to be tried on this case in order for this Court to grant the injunctions sought by the two plaintiffs.

31. The next issue is does the balance of convenience favour grant of the injunctions sought by the plaintiffs on their application on the current proceedings? I answer both questions in the negative.

32. It is confusing to file proceedings after proceedings and with no results, it is confusing making the Court's process an abuse of the process and making clients pay a lot of costs for something that can be amendable in law or curable by the parties themselves through other means.

33. I must refuse the application by the plaintiffs' lawyer for interlocutory injunctions and grant the orders sought by the defendant company.

34. I make the following Orders:

1. Pursuant to Order 12 Rule 40(1)(a)(b)(c) of the National Court Rules, the proceedings W.S No. 850 of 2012 be dismissed for disclosing no reasonable cause of action, as it is frivolous and vexatious and being an abuse of the Court's processes.
   
2. That pursuant to Order 22 Rule 65 of the National Court Rules, the defendants costs shall be on Solicitor/Client basis.
   

Orders accordingly.

________________________________________________
Motuwe Lawyers: Lawyer for the Plaintiffs
Young & Williams Lawyers: Lawyer for Defendant.