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Green Estate Ltd v Patana Co No 50 Ltd [2024] PGSC 38; SC2571 (28 February 2024)

SC2571

PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]

SCM NO. 14 OF 2019

BETWEEN:
GREEN ESTATE LIMITED
Appellant

AND:
PATANA COMPANY NO. 50 LIMITED
First Respondent

AND:
TOMMY TOMSCOLL
Second Respondent

AND:
SIBONA KEMA
Third Respondent

AND:
KEITH LOVAI LAHUI in his capacity as
CHAIRMAN OF PAPUA NEW GUINEA LAND BOARD
Fourth Respondent

AND:
ROMILY KILA-PAT in his capacity as
SECRETARY, DEPARTMENT OF LANDS & PHYSICAL PLANNING
Fifth Respondent

AND:
INDEPENDENT STATE OF PAPUA NEW GUINEA
Sixth Respondent

AND:
BOKO LEKE VANI trading as ELA BEACH CAFE
Seventh Respondent

Waigani: Hartshorn J, Toliken J, Dingake J
2024: 28^th February

SUPREME COURT APPEAL – appeal based on grounds that the Court below erred in fact and in law to issue the declarations it did, in particular, to declare the transfer of the title to the Appellant null and void and of no legal effect - where the forfeiture of a revocation notice was based on other reasons, other than a mistake, such a forfeiture cannot be valid - First Respondent’s title to the land was lawfully forfeited and there was no double allocation of the subject land to the Seventh Respondent, contrary to the holding or conclusion of the Court below - Revocation of Forfeiture Notice did not meet the requirements of Section 123 of the Land Act, and was therefore invalid – appeal upheld

Cases Cited:

Elisha Timothy v Joshinta Timothy (2002) PGSC 82; SC2282
HQ Enterprises Ltd v Wangbao Trading (2023) PGSC69; SC2419

Counsel:

Mr. Kennedy Kulip, for the Appellant
Mr. Gibson Geroro & Mr. M Chou-lee, for the First Respondent
Mr. Roy Yomilewau, for the Fourth, Fifth & Sixth Respondents

28^th February 2024

1. BY THE COURT: This is an appeal against the ex-tempore decision of the National Court handed down on the 3^rd of June 2019.
   
2. At the heart of this appeal is a dispute concerning a piece of land initially registered as State Lease Volume 87 Folio 114 Section 64 Allotment 18 Granville, Port Moresby, NCD (“Subject land”) and was registered to Alina Investment Property on the 16^th of November 1984.
   
3. The First Respondent had filed a judicial review in the Court below seeking the following Orders:
   1. The decision by the Minister for Lands & Physical Planning (“Minister’) through his delegate, Anthony Luben, to forfeit State Lease published in the National Gazette number G89 of 14 June 2007, in which the First Respondent claimed among others the forfeiture related to State Lease Volume 87 Folio 144, which is related to a property described as Allotment 20 Section 123, Granville, NCD and not the property described as State Lease Volume 87 Folio 114, Allotment 18 Section 64, Granville, Port Moresby, National Capital District, which is the correct description of the property belonging to the Plaintiff which is the subject of this proceeding. (Hereinafter referred to as the “First Decision”).
   2. The decision by the Minister to uphold the appeal, through the Head of State, an Appeal by the Ela Beach Café which is the Sixth Defendant (Seventh Respondent) against the decision of the PNG Land Board to withdraw the subject property as an agenda item for its deliberation. (Hereinafter referred to as the “Second Decision”).
   100. The subsequent decision by the Minister for Lands & Physical Planning through the Deputy Registrar of the Title to allocate and register the subject property to Ela Beach Café by grant to lease over the property on 14 April 2011. (Herein after referred to as the “Third Decision”).
4. It is a matter of record that the First Respondent abandoned its application to review the validity of the forfeiture of the subject land. Instead, the First Respondent successfully sought declarations that:
   
   1. their existing State Lease remained valid and effective; and
      
   2. the grant of the state lease to the Seventh Respondent, were null and void and of no legal effect, and
      
   100. the subsequent transfer to the title to the Appellant, were null and void and of no legal effect.
        
5. It is against the above decision/declarations that the Appellant now appeals to this Court.
   
6. The Appellant relies on seven (7) grounds to impugn the decision of the Court below.
   
7. It is not necessary to reproduce the entire grounds relied upon by the Appellant as all the grounds can be subsumed by one ground, namely, that the Court below erred in fact and in law to issue the declarations it did, in particular, to declare the transfer of the title to the Appellant null and void and of no legal effect.
   
8. The dispositive facts of this appeal are largely common cause. The subject land was transferred to the First Respondent on the 19^th of August, 1998.
   
9. On the 14^th of November 2006, the Department of Lands & Physical Planning, believing that First Respondent had failed to comply with the improvement covenant and or conditions and that the subject land had accumulated arrear rentals issued a Notice to Show Cause to the First Respondent as to why the lease should not be forfeited.
   
10. On the 14^th of June 2007, the Department of Lands & Physical Planning caused a Notice of Forfeiture of the First Respondent’s State Lease Volume Folio 144 (corrected to Folio 114) to be published in the National Gazette No. 389 dated 14^th June 2007).
    
11. On the 27^th of September, 2007 a Revocation of Forfeiture Notice under s.123 of the Land Act of 1966, was published in the National Gazette No. G149.
    
12. It would seem, on the evidence, that the subject land was put before the Papua New Guinea (PNG) Land but subsequently withdrawn.
    
13. It would also seem that Ela Beach successfully appealed against the withdrawal. A new title (lease) was issued to the Seventh Respondent, Boko Leke Vani trading as Ela Beach Café. The Seventh Respondent subsequently entered into a contract of sale with the Appellant and transferred title to it on the 8^th of August 2014.
    
14. On the 11^th of September 2014, the Appellant’s acquisition of the title transferred by the Seventh Respondent was registered.
    
15. Given the backdrop of the above undisputed facts, the First Respondent submits, in essence, that the Court below did not commit any error of fact and or law. This argument is premised on the main, on the contention that the Revocation of Forfeiture Notice under Section 123 of the Land Act, on the 27^th of September 2007 was valid.
    
16. The Appellant on the other hand argues that the Revocation of the Forfeiture Notice under Section 123 of the Land Act, was not valid. It argues that it was an innocent bona fide purchaser whose title under Section 33(1) of the Land Act is protected, as there was no evidence that the registered proprietor in the process of acquiring the title committed fraud.
    
17. The Appellant further argues that in the absence of a finding of fraud by the Court below, the Appellant’s title cannot be revoked.
    
18. Section 123 of the Land Act provides:

“123. Revocation of Forfeiture

(1) Where a State Lease (hereafter called “the revoked lease”) has been forfeited under Section 122 by mistake and provide that a notice under Section 75 has not been published in the National Gazette in respect of another applicant, the Departmental Head may, by notice published in the National Gazette, revoke the notice of forfeiture.
(2) Where the Departmental Head publishes a notice under Subsection (1), the revoked lease shall be treated as valid and as effectual as if the forfeiture had not occurred.”

(Our underlying)

19. On the evidence before us, it is plain that the Revocation of Forfeiture Notice was ostensibly issued because “the forfeiture looks suspicious and dubious and requires investigation”.
    
20. In terms of Section 123 of the Land Act, the Notice of Forfeiture may be revoked “where a State Lease (the revoked lease) has been forfeited under Section 122 by mistake ...”.
    
21. In the circumstance of this case, where the forfeiture of a revocation notice was based on other reasons, other than a mistake, such a forfeiture cannot be valid, and we so hold.
    
22. The net effect of our holding is that the First Respondent’s title to the land was lawfully forfeited and there was no double allocation of the subject land to the Seventh Respondent, contrary to the holding or conclusion of the Court below.
    
23. Put differently, the First Respondent’s argument that there were two (2) titles over the same piece of land, given a Revocation of Forfeiture Notice it says was valid, falls away, given our finding or conclusion that the Revocation of Forfeiture Notice did not meet the requirements of Section 123 of the Land Act, and was therefore invalid.
    
24. Our conclusion that the Revocation of Forfeiture Notice was not valid also means, in our respectful opinion, that the Plaintiff would lose any standing to question any alleged irregularity before the Land board.
    
25. This appeal is entitled to succeed based on our conclusion that the Revocation of the Forfeiture Notice was invalid alone. However, there is another ground that favours this appeal being upheld. This ground relates to the fact that once title was lawfully transferred from the Seventh Respondent to the Appellant, as it was, the Appellant assumes indefeasible title over the property.
    
26. In this case, title to the Appellant was registered on the 9^th of May 2018. In the circumstances, the Appellant’s title became indefeasible pursuant to s.33(1) of the Land Registration Act. This is so because the Court below did not find that the Appellant’s title was obtained by fraud. (Timothy v Timothy (2002) PGSC 82; SC2282; HQ Enterprises Ltd v Wangbao Trading (2023) PG SC69.
    
27. In the circumstances, we find that this appeal has merit and ought to succeed.
    
28. In the result, it is ordered that:
    
    1. The First Respondents’ title over the subject land was lawfully forfeited under Section 122 of the Land Act;
       
    2. The purported Notice of Revocation of the Notice of Forfeiture has no basis under s.123 of the Land Act, hence it is null and void.
       
    100. The Appellants State Lease Volume 45, Folio 215, Allotment 18, Section 64, Granville, NCD is valid and effectual.
         
    4. The Appellant is a bone fide purchaser for value and is the registered proprietor of the subject land.
       
    5. The Order sought in paragraph 3 (a) – (e) of the Notice of Motion be granted.
       
    6. The cost of this appeal shall be borne by the First Respondent.

_______________________________________________________________
Young & Williams Lawyers: Lawyers for the Appellant
Geroro Lawyers: Lawyers for the First Respondent
Office of the Solicitor General: Lawyers for the other Respondents