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Karo v Ombudsman Commission of PNG [1995] PGSC 14; [1995] PNGLR 547 (21 April 1995)

PNG Law Reports 1995

[1995] PNGLR 547 - Albert Karo v Ombudsman Commission of PNG�

[1995] PNGLR 547

U2

PAPUA NEW GUINEA

[SUPREME COURT OF JUSTICE]

ALBERT KARO

V

OMBUDSMAN COMMISSION OF PNG

Waigani

Amet CJ Los Sheehan JJ

13 March 1995

7 April 1995

21 April 1995

CONSTITUTIONAL LAW - Judicial review of Ombudsman Commission�s decision made in excess of jurisdiction - Constitution s 217(6).

CONSTITUTIONAL LAW - Ombudsman Commission power to give directions to leaders subject to s 17(1) of Organic Law on the Ombudsman Commission (duty to inform persons being investigated) and s 20(3) of the Organic Law on the Duties and Responsibilities of Leadership (right of persons whose conduct is being investigated to be heard by the Commission) - Constitution s 27(4).

Facts

The appellant was a member of the Parliament and Minister for Works. As such he was a leader, as defined by s 26(1) of the Constitution, and subject to the Leadership Code provided by ss 26-31 of the Constitution and the Organic Law on the Duties and Responsibilities of Leadership. The respondent, the Ombudsman Commission of Papua New Guinea (the Commission), is responsible for enforcement of the Leadership Code (s 218(d) of the Constitution). In September 1993, in the course of an investigation into allegations that the appellant had acted improperly in relation to occupation of a certain house, the Commission issued directions under s 27(4) of the Constitution to the National Housing Corporation and the Minister for Housing to cease all arrangements pertaining to the tenancy of the property pending completion of the investigation. On 11 February 1994, a tenancy agreement was entered into between the appellant and the Housing Commission in relation to the house in question. The Ombudsman Commission subsequently issued a further direction under s 27(4) to the appellant, inter alia, requiring him to leave the house, which he and his family were occupying. At no time prior to 11 February 1994 had the appellant been advised that the Commission was investigating his conduct in relation to the house. The appellant obtained leave to apply for judicial review of the Commission�s decision to issue the direction, but judicial review was refused. The appellant appealed against that decision on the basis that:

N2>1.������ the respondent was required to afford the appellant a right to be heard before issuing such a direction;

N2>2.������ failure to do so rendered the direction an action in excess of jurisdiction, and susceptible to judicial review. The appellant sought an order that the direction made by the Commission was a nullity.

Held

N1>1.������ Pursuant to s 217(6) of the Constitution, decisions of the Commission are subject to judicial review on the basis of excess of jurisdiction by failing to give a person a hearing (Ombudsman Commission v Donohoe [1985] PNGLR 348 followed) or otherwise failing to act fairly in the exercise of its investigative powers.

N1>2.������ The Commission�s power to give directions under s 27(4) of the Constitution is made subject to any organic law made for the purposes of Division 2 of Part III of the Constitution, dealing with the Leadership Code.

N1>3.������ In failing to advise the appellant that he was the subject of investigation, the Commission was in breach of its duty under s 17(1) of the Organic Law on the Ombudsman Commission to inform persons of its intention to investigate their conduct.

N1>4.������ A decision of a preliminary nature which may affect a person�s interests is subject to the principles of natural justice as much as a final decision would. Therefore, although the direction to the appellant was preliminary, it affected his proprietary interests. Accordingly, as a person whose conduct was being investigated by the Commission, the appellant had a right to be heard before any decision was made: s 20(3) of the Organic Law on the Duties and Responsibilities of Leadership.

N1>5.������ The remedy sought was not granted because the appellant had made representations to the Commission upon service of the direction upon him, was given the opportunity to make further representations, and in view of the preliminary nature of the decision, other legal remedies were open to him.

(Ed: This decision was overruled in a 1996 decision of the Supreme Court (Nilkare v Ombudsman Commission (unreported) dated 3 May 1996). It is included in the 1995 PNGLR, however, because it was referred to in a number of subsequent decisions.)

Cases Cited

Ombudsman Commission v Donohoe [1985] PNGLR 348.

Wiseman v Borneman [1971] AC 297; [1969] 3 All ER 275: [1969] 3 WLR 706.

Counsel

G Sheppard, for the appellant.

D Cannings, for the respondent.

21 April 1995

AMET CJ LOS SHEEHAN JJ: This is an appeal against the judgment of the National Court given on 29 December 1994 which, in effect, upheld the validity of a direction of the Ombudsman Commission (the Commission) against the appellant under s 27(4) of the Constitution, requiring him and his family to vacate a house, the subject of the Commission�s investigation. The sole ground of appeal is that the learned trial judge erred in law in finding that the respondent had not exceeded its jurisdiction in issuing a direction to the appellant requiring him to vacate the home, in that the respondent was required to allow the appellant an opportunity to be heard before issuing the direction, but failed to do so.

RELEVANT BACKGROUND FACTS

The following are the relevant background facts for the purposes of this appeal.

N1>1.������ The appellant is a Member of the National Parliament and was the Minister for Works at the relevant time. He was, therefore, a �leader� and susceptible to �directions from the Ombudsman under s 27(4) of the Constitution�.

N1>2.������ In September 1993, the Commission acquired information which suggested that the appellant may have acted improperly regarding his occupation of the subject house.

N1>3.������ The Commission thereupon began to conduct an investigation into the circumstances relating to the allocation and occupation of the house by the appellant.

N1>4.������ The Commission obtained correspondences between the managing director of the National Housing Corporation (the managing director) and the appellant as well as the former and the current Premiers of the Central Province and the National Minister for Housing.

N1>5.������ On the basis of correspondences between the interested parties, the Commission then issued directions under s 27(4) to the managing director and the Minister for Housing (the Minister) to immediately cease all arrangements pertaining to the tenancy of the property to anyone until the Commission had completed its enquiries into the matter. These directions were issued on 6 and 7 September 1993 respectively.

N1>6.������ On the morning of 7 February 1994, the appellant executed a tenancy agreement with the State, represented by the managing director, for occupation of the subject house

N1>7.������ On the afternoon of the same day, 7 February 1994, the Commission summoned the managing director to attend upon the Commission for interview.

N1>8.������ In the interview, the managing director advised the Commission of the circumstances in which he had executed a tenancy agreement with the appellant in relation to the subject property on the morning of 7 February 1994.

N1>9.������ On 11 February 1994, the Commission executed a direction under s 27(4), addressed to the appellant.

N1>10.���� Prior to the direction on 11 February 1994, the appellant had not been questioned in relation to the subject property of the direction, as it was considered by the Commission, in view of the information before it at the time and the nature of the allegations against appellant, that it was in his best interest, and the interest of the Leadership Code, that he be given the direction at an early stage.

N1>11.���� Prior to 11 February 1994, the appellant had not been advised that his conduct was the subject of a complaint, nor had he been advised that the Commission was investigating his conduct on its own initiative. The Commission considered that it was not a requirement of the Constitution or the Organic Law on the Duties and Responsibilities of Leadership that a leader whose conduct is being investigated should be advised that he is under investigation.

The appellant based the appeal on the following propositions:

N2>(a)����� That the Ombudsman was required, as a matter of law, to afford the appellant a right to be heard before issuing a direction, the nature of which was to remove him and his family from their home.

N2>(b)����� The admitted failure to provide the appellant with an opportunity to be heard before issuing the direction amounts, in law, to an action in excess of jurisdiction, rendering the decision to issue the direction susceptible to review by the courts.

The appellant obtained leave and applied to the National Court for judicial review. The Court refused the application, holding that �because of the peculiar powers of the Ombudsman Commission to issue directions at any time, it is not necessary to require the leader affected to be heard�. It is this part of the judgment which is specifically appealed against.

The appellant�s basic contention is that, in all the circumstances of the �investigation� by the Commission and all of the correspondences and other information that may have been in the possession of the Commission, the principles of natural justice and fairness applied before it made the decision to issue the direction pursuant to s 27(4) of the Constitution, which required him and his family to vacate the premises that they had recently occupied as their home. Those principles required that the Commission inform him of its intention to issue a direction and the basis for it, and give him the opportunity to make some response to it. The Ombudsman Commission did not do this, and so it has breached the basic requirement of the principles of natural justice, and, consequently, it has exceeded its jurisdiction. The direction thus is a nullity and of no effect.

The Commission�s response to this submission is that there is no expressed right conferred by s 27(4) entitling a person affected by such a direction to be given a hearing. It submitted that there are two basic reasons why the appellant was not entitled to be heard. Firstly, the proper interpretation of s 27(4) is that, as a general rule, the Commission is not obliged to conduct a hearing before exercising the power conferred by this provision. Secondly, the peculiar circumstances of this particular case showed that a hearing was unnecessary and inappropriate.

Section 27(4) of the Constitution is in the following terms:

�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�.

It was submitted that the specific terms of this section do not state that the Commission should conduct a hearing before giving a direction, and there is no other provision of the Constitution which makes such a hearing mandatory. It was submitted, therefore, that a right to a hearing may only arise by necessary implication, but that such an implication is not justified in this particular case, for the following reasons.

N2>1.������ The Constitution and Organic Laws already provide an exhaustive code for the granting of hearings to persons affected by Ombudsman Commission decisions. There are many provisions which require that persons affected be put on notice and given a right to be heard before decisions are made; e.g. s 28(5) of the Constitution; s 17(1) and (4) of the Organic Law on the Ombudsman Commission; ss 20(2) and (3), 26(1), and 27(4) of the Organic Law on the Duties and Responsibilities of Leadership. The fact that so many of the Commission�s decision-making powers are contingent on a right to be heard being given suggests that when the constitutional laws do not grant such a right to be heard, none in fact exists.

N2>2.������ A person affected by the Ombudsman Commission�s decision has no general consitutional right to be heard.

N2>3.������ The Ombudsman Commission, being a Constitutional institution, has the discretion to provide for its own procedures by virtue of s 224(2) of the Constitution.

N2>4.������ The relationship between s 27(4) and the prosecution provisions of the Constitution and the Organic Law shows that, if the Commission does take action to enforce a direction, it is inevitable and necessary that, at the appropriate time, the person affected by the direction be given a right to be heard before the direction is enforced.

In relation to the submission that the peculiar circumstances of the case showed that a hearing was unnecessary and inappropriate, the following was submitted.

The Ombudsman Commission had been investigating the appellant�s interest in the Touaguba Hill property since at least September 1993. In September 1993, the Commission had given directions to the managing director and the then Minister for Housing to immediately cease all arrangements pertaining to the tenancy of the said property to anyone until the Commission completed its inquiries into the matter.

In October 1993, the Commission had been advised that the earlier decision to allocate the house to the appellant had been withdrawn, and the managing director advised that he had erred in making that decision.

The execution of the tenancy agreement by the appellant on 7 February 1994 contravened the terms of the directions given to the managing director in September 1993: and the Commission�s investigation was still continuing. It was, therefore, necessary to take quick and decisive action to remedy this situation. Any right which the appellant otherwise had to a hearing was negatived by the very unusual circumstances of his particular case, whereby an immediate direction was necessary in order to protect the appellant�s integrity; to maintain the integrity of the Commission�s own procedures; and to ensure the attainment of the objects of s 27 of the Constitution.

The Supreme Court has sufficiently established that review is available to an appellant pursuant to s 217(6) of the Constitution, on the basis that the Commission had exceeded its jurisdiction by failing to give a person a hearing: Ombudsman Commission v Donohoe [1985] PNGLR 348.

The Organic Law on the Duties and Responsibilities of Leadership, by s 17, stipulates the functions of the Commission, in relation to responsibilities of office, in the following terms:

N2>�(c)��� To investigate, on its own initiative or on complaint by any person, or cause such an investigation to be carried out into any alleged or suspected misconduct in office by a person to whom this law applies�.

Section 20 of the same Organic Law provides for the proceedings of the Commission in the following terms:

N2>�(1)��� Every investigation by the Commission or other authority under this Law shall be conducted in private.

N2>(2)����� The Commission or other authority may hear or obtain information from any person who the Commission considers can assist and may make whatever inquiries it thinks fit and shall, before taking action under Subsection (4) notify the person whose conduct is being investigated.

N2>(3)����� Nothing in this Law compels the Commission or other authority to hold any hearing and no person, other than the person whose conduct is being investigated is entitled as of right to be heard by the Commission.

N2>(4)����� If, after an investigation, the Commission is of the opinion that there is evidence of misconduct in office by a person to whom this Law applies, it shall refer the matter to the Public Prosecutor for prosecution by him before the appropriate tribunal.�

The Organic Law on the Ombudsman Commission also provides, by s 17, for the proceedings of the Commission in the following terms:

N2>�(1)��� Before investigating any matter within its jurisdiction, the Commission shall inform the responsible person of its intention to make the investigation.�

The plain question to be asked for the purposes of this appeal is: did the Ombudsman Commission act fairly toward the appellant in making the decision to issue a direction under s 27(4)? This is the basic requisite of the legal expression �acting in accordance with the rules of natural justice�.

There are two approaches to this basic issue. The first is by reference to the relevant provisions of the constitutional laws, in their interpretation and application to this issue. If, by a plain reading of these provisions, the issue is definitely determined without the need to resort to extraneous aids to interpretation and underlying law precedents on the principles of �fairness�, then that would be conclusive. The second is that, if the plain reading, interpretation, and application of these provisions does not provide a conclusive opinion on the issue, then recourse may be had to underlying law and foreign case law precedents to assist in the task of interpretation of the primary provisions.

We are satisfied that the Commission was required to give notice and an opportunity to the appellant to respond to it, and give any explanation he wished to, before the Commission made the decision to give the direction. The notice should contain sufficient information as to the basis upon which the Commission proposed to take the course or make the decision, to enable the appellant to adequately respond to it.

Firstly, the relevant provisions of the constitutional laws sufficiently require that notice and an opportunity to be heard be given to the appellant.

The very primary provision s 27(4) of the Constitution, which the Commission has relied upon to assert its perceived power and authority to give directions without the need to give notice or an opportunity to be heard to the person be affected, who is being investigated, is, quite contrary to the effect of the Commission�s propositions, not absolute and without qualification. As can be noted from the expressed provisions of subsection (4), the discretion to give directions is �subject to any Organic Law made for the purposes of this division�. One then needs to refer to the relevant Organic Law or laws made for the purposes of the enforcement of the Leadership Code provisions to ascertain whether this discretion to give directions is subject to any qualification.

Turning firstly to the Organic Law on the Ombudsman Commission, s 17(1), which is quoted above, quite expressly directs that �before investigating any matter within its jurisdiction, the Commission shall inform the responsible person of its intention to make the investigation�. This quite cleary is a mandatory obligation upon the Commission to give notice to the person whose conduct it is intended to investigate.

The Organic Law on the Duties and Responsibilities of Leadership also provides under s 20(3) that �no person, other than the person whose conduct is being investigated is entitled as of right to be heard by the Commission�. In other words, only the person being investigated has a right to a hearing.

Reading these several specific provisions plus the totality of the relevant provisions referred to, the following propositions are, in our view, to be enunciated:

N2>1.������ By virtue of s 17(1) of the Organic Law on the Ombudsman Commission, the Commission is under a duty to inform a person that the Commission intends to make investigation of his conduct in relation to any mattter within its jurisdiction. This notice can be in writing, or verbal. It is preferable, of course, for proof of the notice and the contents of it for the notice to be in writing. The notice needs to inform the responsible person of the intention to make the investigation, the nature of the investigation, the issues to be investigated, and, more importantly, the reasons why it is proposed to make the investigation. This initial notice does not require that the responsible person be given a hearing at this stage.

N2>2.������ By virtue of s 20(3) of the Organic Law on the Duties and Responsibilities of Leadership, �the person whose conduct is being investigated is entitled as of right to be heard by the Commission�. This is a mandatory duty as well, that in the course of the investigation, at an appropriate time to be determined by the Commission in its judgment, prior to any report or decision being made, the person whose conduct is being investigated shall be entitled to be given a hearing by the Commission. This clearly envisages that at a particular point in time in the course of the investigation, when the Commission has obtained some information pertaining to the conduct of the person being investigated, considered to be sufficient by the Commission, it must then give the person responsible an opportunity to be heard in relation to the issues being investigated.

It must be clear that this right to be heard is distinct from the right to be informed of the Commission�s intention to make the investigation under s 17(1) of the Organic Law on the Ombudsman Commission.

Again, we say that this right to be heard need not be necessarily in person orally before the Commission. It can be facilitated quite satisfactorily in writing, as long as the person whose conduct is being investigated is furnished with all the necessary documents and particulars of the investigation and any evidence, complaints, and allegations that have been gathered in relation to his conduct, that he needs to be fully informed of, in order that his reply, response, or explanation is to be considered adequate.

N2>3.������ By virtue of s 20(2) and (4) of the Organic Law on the Duties and Responsibilities of Leadership, if after an investigation the Commission is of the opinion that there is evidence of misconduct in office by the person investigated, and it is decided to refer the matter to the Public Prosecutor for prosecution before the appropriate tribunal, the Commission shall inform the person affected of that decision before taking it.

The first observation of fact to be made relevant to these propositions is the plain admission by the Commission, in the affidavit of the then Chief Ombudsman, that at no time prior to the execution of the direction on 11 February 1994 was the appellant advised that his conduct was the subject of a complaint or that the Commission was investigating his conduct on its own initiative. By the Commission�s own submissions of fact, it had been investigating the appellant�s interest in the Touaguba Hill property since at least September 1993.

These admissions are clear contravention of the mandatory requirement under s 17(1) of the Organic Law on the Ombudsman Commission to inform the responsible person of the intention to make any investigation. This the Commission had not done.

It was contended for the Commission that s 27(4) allows the Commission to protect the integrity of leaders by reminding them of their basic obligations under s 27(1), (2), and (3) of the Constitution. It is also intended to allow the Commission to prevent breaches of the Leadership Code from occurring and that, in order to issue a direction under this section, it is not necessary for the Commission to have in its possession prima facie evidence that a leader is guilty of misconduct in office. It is, therefore, an appropriate power for the Commission to exercise at the early stages of an investigation, in that it allows the Commission to take pro-active action to prevent breaches of the Leadership Code from occurring. It was further contended that it is sometimes necessary for the Commission to act quickly, firmly, and decisively in order to protect a particular leader who is engaging in conduct that may call his integrity into question.

The primary submission pursuant to these reasoning was that, given the peculiar circumstances of the case, it was necessary to take quick and decisive action to protect the appellant�s integrity and also to maintain the integrity of the Commission�s own procedures.

It is true that the Commission was still investigating the conduct of the appellant. It is also true that, theoretically, the issuing and compliance with the direction may also have the effect of protecting the appellant�s integrity.

The fact, however, is that by the Commission�s own evidence, contained in the affidavit of the Chief Ombudsman, the body of information that was in the possession of the Commission suggested, in the Commission�s opinion, that the appellant �may have acted improperly regarding his occupation of a house on a property at Touaguba Hill, Port Moresby�. The Commission, thus, at that point in time, on 11 February 1994, formed an opinion that the appellant may have acted improperly regarding the occupation of the property and, thus, possibly breaching the Leadership Code, which may call his integrity into question. The Commission decided to issue the direction in order to protect the integrity of the appellant, it was submitted.

Unfortunately, the very conclusion and opinion that the appellant may have acted improperly and the decision to issue the direction also had the immediate effect of affecting the personal property interest of the appellant. And although that decision to issue the direction is said not to be final, it, nevertheless, had adverse consequences on the property interest of the appellant.

In our judgment, because of that consequence and effect, it was incumbent upon the Commission to have given notice to the appellant informing him of the proposed course of action and giving him an opportunity to respond and explain, if he so wished, as to why that decision should not be executed.

Section 20(3) of the Organic Law on the Duties and Responsibilities of Leadership, in our judgment, envisages the very situation of a person whose conduct is being investigated being entitled, as of right, to be heard during investigation before any decision is made by the Commission that would have any adverse ramifications upon that person�s interest. The decision by the Commission to issue the direction did have direct implications upon the property interest of the appellant. He was directed to vacate the premises that he and his family had recently occupied.

This right to be heard, in our view, is the basic minimum requirement of fairness. To accord the appellant this opportunity of being heard as to why he should not be directed to vacate the premises would not have detracted from or prejudiced the attainment of all the fine objectives that the Commission has relied upon. A short period of time allowed for the appellant to have exercised this right would not have prejudiced the Commission in proceeding subsequently to give the direction that it had proposed to give. After giving the appellant that opportunity to be heard, the Commission could still have proceeded to issue the direction to achieve the end that it desired.

Indeed, in our view, to so accord such a person whose conduct is being investigated the opportunity to respond to any incriminating or adverse material or information in its possession, on the basis of which the Commission was proposing to issue a direction, could only re-enforce the credibility and integrity of the process and the institution of the Ombudsman Commission. The Commission would not then be criticised for not being fair.

As we had indicated, the question of fairness and an opportunity to be heard in relation to any preliminary findings and opinions that will have adverse effect is not confined strictly to investigations where the decisions affecting a person�s rights and duties are final, but apply also to investigations where the Commission is to decide a preliminary point which also impacts and affects the interest of the person being investigated.

Some basic principles of fairness, as enunciated in the English House of Lords decision of Wiseman v Borneman [1971] AC 297, are appropriate and relevant to the issue of fairness in this appeal. Lord Guest said at p 311:

�I can see no reason why, if the principles of natural justice have to be applied to a tribunal entrusted with a final decision, the same should not be true of a tribunal which has to decide a preliminary point which may affect parties� rights�.

At page 317 Lord Wilberforce said the same:

�I cannot accept that there is a difference in principle, as to the observance of the requirements of natural justice, between final decisions, and those which are not final, for example, decisions that as to some matter there is a prima facie case for taking action.�

In conclusion, we do not think it necessary in this case to refer to extraneous case law precedents. The constitutional provisions adequately provide the answer to the issue. It was not fair for the Ombudsman Commission, in all the circumstances of this appellant�s case, to have issued the direction without giving notice and an opportunity to him to be heard first. The Commission was, therefore, in error.

The next issue is whether, in the exercise of the Court�s discretion the remedy sought should be granted, since that the Commission erred in not giving the appellant the opportunity to be heard.

The Commission submitted that the appellant should be denied the remedy for two reasons. Firstly, it was contended that he was guilty of undue delay, in that a period of almost three months lapsed between the service of the direction on 16 February 1994 and the application for leave to seek judicial review on 12 May 1994. Secondly, it was submitted that grant of the remedy sought would be futile, because the Commission had already taken steps to declare the appellant�s interest in the property to be a prohibited interest, in accordance with Part IV of the Organic Law on the Duties and Responsibilities of Leadership.

We decline to grant the remedy sought, but for other reasons. We consider that, although the appellant was not given an opportunity to be heard before the direction was given, he had made immediate representation to the Ombudsman Commission after service of the direction upon him, and further opportunity was given him by the Commission to provide documents that might have mitigated his position. Because this was a preliminary decision pending completion of the investigation, the facts also disclose that other legal remedies are still open to the appellant.

Costs of the appeal to the appellant.

Lawyers for the appellant: Maladina Lawyers.

Lawyers for the respondent: Ombudsman Commission of PNG.