Home | Databases | WorldLII | Search | Feedback National Court of Papua New Guinea

Unagi v U & M Stonecraft Ltd [2016] PGNC 106; N6279 (11 May 2016)

N6279

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS (JR) NO 730 OF 2013

BETWEEN

DIANE UNAGI
Plaintiff

AND
U & M STONECRAFT LIMITED
First Defendant

AND
ROMILLY KILA PAT in his capacity as SECRETARY OF THE DEPARTMENT OF LANDS AND PHYSICAL PLANNING
Second Defendant

AND
THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Third Defendant

Waigani: Makail, J
2016: 16^th March & 11^th May

JUDICIAL REVIEW – Extinguishment of State Lease – Effect of – Subsequent grant of State Lease – Land Act, Ch 185 – Sections 34, 35 & 36 – Land Act, 1996 – Sections 75 & 77

PRACTICE & PROCEDURE – Objection to competency – Requisite standing and authority of plaintiff to sue –Plaintiff suing on behalf of deceased estate – Evidence of Letter of Administration produced – Plaintiff appointed Administrator of deceased estate – Probate action – Objection goes to form rather than substance – No adverse prejudice to defendants – Objection dismissed – National Court Rules – Order 4, rule 20 (2)

Cases cited:
Kapiura Trading Limited v. Bullen (2012) N4903

Counsel:
Ms. G. Salika with Ms. K. Najike, for Plaintiff
Mr. H. Kevau, for First Defendant
Ms. A. Nasu, for Second and Third Defendants

JUDGMENT

11^th May, 2016

1. MAKAIL, J: The Plaintiff Ms. Diane Unagi is the daughter of the late Mr. David Unagi the former Member of National Parliament for Moresby North East electorate. She seeks to review two decisions:

1.1. The decision of the former Secretary of the Department of Lands and Physical Planning Mr. John Painap to extinguish a State Lease granted to Mr. Unagi dated 25^th June 1997; and

1.2. The decision of the former Secretary of the Department of Lands and Physical Planning Mr. Morris Alaluku to grant a State Lease to a company called Del Oro Pty Ltd (“Del Oro”) dated 16^th November 1998.

2. The subject property is described as State Lease Volume 21 Folio 48 Allotment 20 Section 345, Hohola, National Capital District. It was previously known as DC 345/008 Allotments 8 & 9 Section 354, Hohola, National Capital District. It is a State Lease (Light Business Lease) issued under the Land Act, Ch 185 (“Old Act”).

Undisputed Facts

3. There is no dispute that on 22^nd June 1989 the property was advertised in the National Gazette (Tender No. 107/89) as land available for leasing pursuant to section 30 of the Old Act. On 29^th June of that year late Mr. Unagi submitted an application for Business (Light Industry) Lease pursuant to section 32 of the Old Act. There were three other applicants. They were:

(a) Western Highlands Potatoe Pty Ltd;
(b) John Orea; and
(c) Henanamo Pty Ltd.

4. There is also no dispute in its meeting of 23^rd November the Land Board approved Mr. Unagi’s application. On 22^nd January of the following year the late Unagi received a note informing him that his application was approved and a recommendation was made to the Minister for Land and Physical Planning for grant of a State Lease to him. He was also informed of the size of the land, the annual rent of K3, 330.00 and reserve price of K39, 960.00 and that he need not pay any rent or fees until further notice.

5. On or about 11^th April 1990 the late Mr. Unagi’s name was published in the National Gazette as being the successful applicant pursuant to section 34 of the Old Act. The dispute arose when the former Secretary Mr. Painap extinguished the State Lease. Subsequently, a State Lease was granted to Del Oro over the same land.

Grounds of Review

6 From the Statement made pursuant to Order 16, rule 3 (2) of the National Court Rules filed on 6^th December 2013 Ms. Unagi relies on the following grounds in respect of the Extinguishment Notice:

6.1. Error of Law

The error is the Extinguishment Notice was issued under section 36 (1) of the Old Act when it was superseded by the Land Act, 1996 (“New Act”). Thus, the said notice should have been issued under the New Act.

6.2. Breach of Procedure

The breach is that the said notice was advertised on 14^th June 1997 in Gazette No. 60 and signed over 11 days later on 25^th June 1997. The error is the notice should have been signed prior to gazettal.

7. In respect of the grant of State Lease to Del Oro Pty Ltd, she relies on the following grounds:

7.1. Error of Law and/ or Breach of Procedure

The error is according to section 79 of the New Act, 60 days after the date of publication of the said notice the Departmental Head must forward the Letter of Grant to the second choice applicant and if he does not show up, then to the third choice applicant. This process was not followed. Del Oro was never an applicant when late Mr. Unagi applied for the land.

7.2. Unreasonableness and Bias

The unreasonableness of the decision is that late Mr. Unagi was charged lease grant fee of K65, 987.67 and Del Oro was charged K687.73 for the same land. Given that the latter applied later in time land prices have increased and the lease grant fee should have been more than what was charged to her late father.

7.3. Error of Law

The purported sale and transfer of title from Del Oro to the First Defendant was without Ministerial approval and this is contrary to section 128 of the New Act which requires Ministerial approval.

7.4. Breach of Natural Justice

The late Mr. Unagi was not accorded the right to be heard prior to the issuance of the Extinguishment Notice. As a result he was not aware that the Second and Third Defendants were going to extinguish his right to a grant of a State Lease and did not respond to the notice.

Preliminaries

8. I deal with two preliminary issues. First is the issue of competency of proceedings. It is being raised by the Defendants on the ground that Ms. Unagi does not have the standing to bring this proceeding unless in her capacity as an executor or administrator of the estate of her late father. If she is suing as an executor or administrator of the estate, then the originating process does not state so. On this basis the proceeding is incompetent.

9. Ms. Unagi refers to the Letter of Administration issued by the National Court on 13^th October 2010 which may be found in her affidavit in support filed on 6^th December 2013 and submits that, based on this document she has the authority to bring this proceeding on behalf of the estate of her late father.

10. In my view the objection here goes to the question of form rather than substance. The Defendants do not deny that by virtue of the Letter of Administration, Ms. Unagi has been appointed Administrator of her late father’s estate. Given this, this is a probate action by virtue of Order 4, rule 20 (2) of the National Court Rules and the endorsement in the originating summons must show that Ms. Unagi claims in her capacity as an Administrator of the deceased estate.

11. While the proceeding does not confirm with this requirement, or as the Defendants put it, should have been commenced in the name of the estate of Ms. Unagi’s late father, I am satisfied that Ms Unagi has the requisite standing and authority to bring this proceeding and the failure to bring the proceeding in the name of her late father’s estate is not adverse to the Defendants’ defence.

12. The second reason is this, as there are competing claims to the property, it is in the interests of justice that Ms. Unagi be allowed to raise her claim so that it can be resolved once and for all and parties can move on with their lives.

13. For these reasons, the objection is dismissed.

14. The second preliminary matter is the attempt by counsel for the Second and Third Defendants to rely on the affidavit of Mr. Jonathan Saka of counsel. This affidavit was struck out as being hearsay and inadmissible because Mr. Saka deposed to factual matters which were not within his direct knowledge. Evidence relevant to the matters in dispute should have come from an officer within the Department of Lands and Physical Planning (“DLPP”). Given these there is no evidence offered by these Defendants in response to the evidence of the Plaintiff.

Extinguishment Notice

15. Notwithstanding this, the onus is on the Plaintiff to prove her case. In this respect, the grounds relied upon by Ms. Unagi at paragraphs 6.1 and 6.2 (supra) are, in my view, important in relation to questioning the exercise of power by the former Secretary for DLPP to extinguish the right to grant a State Lease to late Mr. Unagi under section 36 (1) of the Old Act. However, in my view, the dispute comes down to the construction and application of section 36 to the facts of this case. The equivalent of this provision in the New Act is section 77.

16. Section 36 states:

“36. Acceptance of terms, etc., of proposed leases.

(1) The Departmental Head may, by notice in the National Gazette, extinguish the right of a successful applicant for a lease if the applicant does not, within 28 days after the publication of a notice in the National Gazette under Section 34 in respect of him or such further time (if any) as is notified to him by the Departmental Head–

• (a) forward a notice of acceptance of the terms, conditions, provisions, restrictions and covenants of the proposed lease as set out in the notice to him under Section 35 so as to reach the Departmental Head not later than 4.00 p.m. on the twenty-eighth day after the publication of the notice or on such later date as is notified to him by the Departmental Head; and
  
• (b) pay all amounts specified in the notice.
  

(2) A person who forwards a notice of acceptance to the Departmental Head under Subsection (1) shall be deemed to have executed the lease on the date on which the Minister executes the lease under Section 116.”

17. According to this section, the right of a successful applicant for a lease may be extinguished if the applicant does not, within 28 days after the publication of a notice in the National Gazette under Section 34 first forward a notice of acceptance of the terms, conditions, etc.., to the Secretary for DLPP. Secondly, pay all amounts specified in the notice.

18. On the other hand, a person who forwards a notice of acceptance to the Secretary shall be deemed to have executed the lease on the date the Minister executes it under section 116.

19. In this case the uncontested evidence is that late Mr. Unagi is the successful applicant. Pursuant to section 35 of the Old Act and the decision of the National Court in Kapiura Trading Limited v. Bullen (2012) N4903, the former Secretary has a duty to send to him a notice (now referred to as Letter of Grant (“LG”) under section 75 of the New Act) and notice of acceptance (now referred to as Lease Acceptance Form (“LAF”) under section 75 of the New Act).

20. It is the further uncontested evidence that late Mr. Unagi did not forward the notice of acceptance or LAF to the Secretary within the prescribed time limit of 28 days. The reason is this, at paragraphs 75, 76, 77 and 78 of her written submission counsel for Ms. Unagi submits that there is no evidence to establish that late Mr. Unagi received the notice or LG and notice of acceptance or LAF.

21. Significantly, she relies on the letter from late Mr. Unagi to the Secretary of DLPP dated 03^rd January 2001 which she submits asserted, amongst other things, that on a number of occasions the late Mr. Unagi enquired at the DLPP as to the payment of fees and issuance of title but was advised to wait until “the lands department does some documentation” and that he will be further advised.

22. These submissions must fail because at paragraphs 7, 8, 9, 10 and 11 of her affidavit in support filed on 6^th December 2013 Ms. Unagi unequivocally states that she went to the DLPP to do a file search but the “Land File” was missing. She went through all of her late father’s documents in the house and found copies of documents regarding the property. (Emphasis added).

23. Amongst the documents, she found a copy of the Land Board recommendation letter 22^nd January 1990. This letter stated that the Land Board recommended that the State Lease be granted to her late father. Further and significantly, she found further documents. They were:

23.1. Notice dated 26^th November 1990 with a fee in the sum of

K43, 677.67;
23.2. Notice dated 6^th March 1997 with a fee in the sum of K65, 987.67;
23.3. Notice of Acceptance of Lease due on 24^th December 1990;
23.4. Notice of Acceptance of Lease due on 6^th April 1997; and

23.5. Letter from the then Regional Manager, Southern Region to late Mr. Unagi dated 28^th July 1993.

24. I find the Notice dated 26^th November 1990 is the equivalent of the LG because it was issued under section 35 of the Old Act. Further, I find the Notice of Acceptance of 24^th December 1990 is the equivalent of the LAF because it was issued under section 36 of the Old Act. The Regional Manager’s letter gave a 30 day extension of time for late Mr. Unagi to comply with section 36 of the Old Act which was to sign the LAF and return it with payment of relevant fees. In the circumstances, I find these documents were in late Mr. Unagi’s possession.

25. Consequently, I find that late Mr. Unagi was served the LG and LAF. He failed to sign and return the LAF as evidence to confirm his acceptance of the proposed State Lease. Consequently, the Secretary was not given notice of his acceptance of the proposed State Lease. Further, I find that the DLPP sent reminder notices to late Mr. Unagi but he failed to confirm his acceptance of the proposed State Lease.

26. In a case where a successful applicant does not within 28 days after the publication of a notice in the National Gazette forward the notice of acceptance (now referred to as LAF) to the Secretary of DLPP, it is open to the Secretary to extinguish the right of the successful applicant for the State Lease.

27. In this case the former Secretary Mr. Painap waited for late Mr. Unagi to confirm his acceptance for the proposed State Lease and he failed. Despite reminders and extension of time, he also failed. In the circumstances, I find that it was open to the former Secretary to exercise his power pursuant to section 36 to extinguish the right of late Mr. Unagi for a State Lease.

28. A further point which requires clarification is counsel’s submission that late Mr. Unagi acted in the advice of the officers of the DLPP not to pay any fees until further notice when he attended at the office of the DLPP to pay rental and associated fees to obtain the title. Based on this advice, he did not pay the fees.

29. This submission appears to be based on the statement in the letter by late Mr. Unagi to the Secretary dated 3^rd January 2001 where it was stated at paragraphs 6 and 7 that “In 1990/91, I enquired on a number of occasion (sic) to have my fees paid and have the titles granted. I was advised to wait until the lands department does some documentation and that I will be advised later. After waiting for a year, we checked again and were (sic) told to wait for some time. This was 1992/1993.”

30. There are two problems with this submission. First, if the assertion is accepted, and the documentation referred to are the LG and LAF, then it would contradict Ms. Unagi’s evidence and which I have already found that these documents were served on late Mr. Unagi and he failed to sign the LAF and return to the Secretary to confirm his acceptance of the proposed State Lease.
31. Secondly, the assertion was made in 2001. This is almost 11 years after the Land Board recommendation letter. Even discounting the time he attended at the DLPP between 1990 and 1993, there is a period of unexplained delay of almost 8 years. During this period, two significant events occurred. A State Lease was granted to Del Oro over the same land. Subsequently, Del Oro sold it to the First Defendant.

32. In totality, Ms. Unagi is asking the Court to set aside a decision made some 23 years ago if one were to compute time from the date of issue of this proceeding of 6^th December 2013. In my view the delay is inordinate. Surely, the delay must be against her case and to trivialise it would be adverse to the interest of the First Defendant as the current registered proprietor who claims to be a bona fide purchaser.

33. Judicial review is an equitable remedy as the relief that are granted by the Court must be fair and just to do justice in the circumstances. In a case where the delay in seeking such relief is long and inordinate, the Court will be hesitant to grant them. In this case given the long delay, I am not satisfied that it is just and fair to set aside the decision complained of.

Conclusion

34. I conclude neither was there any error in the exercise of power by the former Secretary to extinguish the State Lease for late Mr. Unagi nor did he improperly exercise that power. These findings render the consideration of the grant of the State Lease to Del Oro unnecessary.

Order

35. The proceeding is dismissed with costs, to be taxed, if not agreed.

________________________________________________________________
Simpsons Lawyers : Lawyers for the Plaintiff
Rageau Manua & Kikira Lawyers : Lawyers for the First Defendant

Solicitor-General : Lawyers for the Second& Third Defendants