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Porgera Gold Mines Ltd v Ondalane [2024] PGNC 343; N11022 (1 October 2024)

N11022

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

WS NO. 128 OF 2023 (IECMS-CC2) (No.3)

BETWEEN:
PORGERA GOLD MINES LIMITED
Plaintiff

V

KIMALEYA ONDALANE OF TIENI YANGUA CLAN AND TIENE YANGUA LANDOWNERS BUSINESS GROUP INCORPORATED
First Defendant

AND:
NELSON AKIKO OF TIENI WAIGOLO LANDOWNERS BUSINESS GROUP INCORPORATED
Second Defendant

AND:
RUEBEN NALEPE OF PULUMAINI AMBO ENDEME CLAN AND PULUMAINI AMBO ENDEME LANDOWNERS BUSINESS GROUP INCORPORATED
Third Defendant

AND:
JUSTIN HAIARA OF HAIARA’S LEGAL PRACTICE
Fourth Defendant

AND:
EVE INJIA OF SLM LEGAL PRACTICE
Fifth Defendant

AND:
JONATHAN PARAIA
Sixth Defendant

Waigani: Anis J
2024: 24^th September, 1^st October

MOTION TO STAY PROCEEDING – Order 12 Rule 1 – National Court Rules, and s.158(2) of the Constitution – whether proceeding should be stayed – preliminary issue – whether a party can seek stay premised on arguments or interests of a third party or parties– whether the ground or basis for stay raised by party other than the relevant or proper party or parties – whether the stay should be refused on the preliminary issue - consideration - ruling

Cases Cited:

Sunset Rentals Ltd v Pacific View Apartments Ltd (2020) SC1994
Ace Guard Dog Security Services Ltd v Lailai (2004) SC757
Porgera Gold Mines Limited v. Kimaleya Ondalane and Ors (2023) N10274

Counsel:

J Nandape, for the Plaintiff
P Harry, for the Second and Third defendants
I Haladei, for the Fifth Defendant
Jonathan Paraia, In Person

DECISION

1^st October, 2024

1. ANIS J: On Tuesday 24 September 2024, I heard a notice of motion (NoM) filed by the second and third defendants (the defendants). They sought to stay the proceeding from proceeding to trial. The NoM was contested by the plaintiff.

2. I reserved my ruling thereafter to a date to be advised.

3. This is my ruling.

BACKGROUND

4. The proceeding (WS 128 of 2023/this proceeding) concerns a consent order dated 3rd March 2023 (Consent Order). The Consent Order was signed and endorsed by the National Court in a separate earlier hearing in OS No. 25 of 2023 (OS 25). The plaintiff was the defendant and the defendants the plaintiffs, in OS 25.

5. The plaintiff, however, and premised on its pleadings, denies its involvement in OS 25. It claims, amongst others, that persons that had engaged lawyers to represent it in OS 25 did not have its authority to do so. According to the pleadings and relief that are sought herein, the plaintiff is alleging, amongst others, illegality, fraud, deceit, and improper conduct and misrepresentation by the actions, inactions and conducts of the defendants and the lawyers that were involved at the material time. The plaintiff, by this proceeding, primarily intends to set aside the Consent Order.

MOTION

6. Relief 1 of the NoM states, and I quote:

1. Pursuant to Order 12 Rule 1 of the National Court Rules, the inherent jurisdiction of the Court to conduct proceedings, and the duty of the Court and Section 158(2) of the Constitution, the proceedings herein be stayed pending the restructure of Porgera Gold Mines Ltd by reason of the liquidation of Kupiane Gold Resources Ltd, pending determination of the unlawful changes made to the directors and shareholders of Kupiane Holdings Ltd in the proceeding OS 84 of 2023, pending determination of the consolidated appeals SCA 34 of 2024.
   

7. The defendants rely on the affidavit of Ruben Nalepe filed 2 September 2024.

CONSIDERATION

8. As a preliminary matter, and in Mr. Harry’s closing argument, I inquired with counsel where his clients’ interest was in this, that is, premised on what was sought in the NoM.

9. Counsel essentially submitted that his clients were sued in their capacities as described in this proceeding. Counsel also expounded into the shareholding interests of clans or groups that hold shares in the plaintiff.

10. Having considered the submission from counsel, I must say that I am not convinced that his clients have any real interest or business to venture into the internal affairs of the Plaintiff which is a separate legal entity. [Section 16, Companies Act 1997 (CA), Sunset Rentals Ltd v Pacific View Apartments Ltd (2020) SC1994, Ace Guard Dog Security Services Ltd v Lailai (2004) SC757]. The defendants have not obtained leave under the provisions of the CA, (i), to speak or make representations for the plaintiff concerning its affairs or,(ii) to seek the specific relief in the NoM where they are asking the Court to stay the proceeding for the reason that and I quote, pending the restructure of Porgera Gold Mines Ltd by reason of the liquidation of Kupiane Gold Resources Ltd, pending determination of the unlawful changes made to the directors and shareholders of Kupiane Holdings Ltd in the proceeding OS 84 of 2023, pending determination of the consolidated appeals SCA 34 of 2024. In fact, the plaintiff is represented by Ms Nandape, and it opposes the NoM. The plaintiff does not regard the claim to be relevant to the present proceeding. Ms Nandape submits on this point that the outcome, if the plaintiff is successful, would be beneficial to the shareholders of the company, thus counsel says she therefore fails to see the logic in Mr Harry’s argument. Secondly, the allegation made on Kupiane Gold Resources Ltd (KGRL) being liquidated appears to be a separate matter that has no relevance to the outcome of this proceeding. The relevance of this proceeding was explained in Porgera Gold Mines Limited v. Kimaleya Ondalane and Ors (2023) N10274. I quote from para. 22 as follows:

22. I note that a considerable amount of time was spent by both counsel including Mr Harry, explaining the status or background of the directors of the plaintiff, and challenging their legitimacies as directors; arguments concerning the 2 factions. In my view, these arguments are irrelevant for this purpose. The plaintiff has not invoked this Court’s jurisdiction to find out about the status quo of each of its directors. Rather, it is seeking to set aside the Consent Order which is the main dispute to be argued at trial. And as stated, what will be relevant at trial is whether the plaintiff or directors, had followed due process to appoint its then lawyer Ms Injia of SML Legal Practise to act for it to sign the Consent Order; whether the Consent Order was obtained irregularly; also, whether fraud or deceit or fraudulent conduct had occurred at the material time. What may also be relevant is the status quo of the directorship of the plaintiff at the material time (i.e., material time being before and at the time when the Consent Order was signed). It is unlikely that the trial Court will concern itself on which directors were appointed after the material time.

11. I would add that the same reasoning may apply to shareholding interests of the plaintiff at the material time. But these may be matters for trial to be considered at an appropriate time.

12. Thirdly, I note that the defendants are relying on the supporting affidavit of Ruben Nalepe filed 2 September 2024. Mr Nalepe claims to be a director and shareholder of Kupiane Holdings Ltd (KHL) which is a shareholder of the plaintiff. Assuming that that is his correct status as he claims, I note that he is not sued in that capacity in the present proceeding. Further, Mr Nalepe appears to have no business to be speaking for or giving evidence on the affairs of another shareholder of the plaintiff who may be in liquidation. His evidence in support of the NoM therefore appears inconsequential and lacks value. I find that to be the case.

13. Fourthly, if there is an issue as alleged by the defendants in the present NoM, the relevant person would be the appointed liquidator who may make representation to raise the matter before this Court. There is no evidence before me that the defendants had obtained the consent or authority of the liquidator to raise the issue before the Court or seek the specific relief as pleaded in the NoM.

14. And lastly, I note that I have issued restraining orders on 30 May 2023 that preserves the status quo of the plaintiff and its board members pending determination of the matter or until further orders of the Court.

15. I therefore find the defendants’ notice of motion to be baseless and an abuse of the Court process.

SUMMARY

16. The defendants’ NoM will be dismissed.

COST

17. I will order cost to follow the event, on a party/party basis to be taxed if not agreed.

ORDERS OF THE COURT

18. I make the following orders:

1. The second and third defendants’ notice of motion filed 2 September 2024 is dismissed.
   
2. The second and third defendants to pay the plaintiff’s cost of the application on a party/party basis to be taxed if not agreed.
   
3. Time for entry of these orders is abridged to the date and time of settlement by the Assistant Registrar of the National Court which shall take place forthwith.
   

The Court orders accordingly.
________________________________________________________________
Nandape & Associates: Lawyers for the Plaintiff
Harry: Lawyers for the Second & Third Defendant
SLM Legal Practice: Lawyers for the Fifth Defendant