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In the Matter of The Organic Law on Provincial and Local-Level Governments and the Constitution of Papua New Guinea; Siembo v National Executive Council [1998] PGNC 110; N1780 (10 November 1998)

Unreported National Court Decisions

N1780

PAPUA NEW GUINEA

[NATIONAL COURT OF JUSTICE]

OS NO. 502 OF 1998
IN THE MATTER OF THE ORGANIC LAW ON PROVINCIAL AND LOCAL-LEVEL GOVERNMENTS AND THE CONSTITUTION OF PAPUA NEW GUINEA
IN THE MATTER OF THE QUESTION AS TO THE SUSPENSION OF THE ORO PROVINCIAL GOVERNMENT
BETWEEN
THE HONOURABLE SYVANIUS SIEMBO M.P
GOVERNOR OF THE ORO PROVINCIAL GOVERNMENT
(IN SUSPENSION), THE ORO PROVINCIAL EXECUTIVE COUNCIL (IN SUSPENSION), AND THE ORO PROVINCIAL GOVERNMENT (IN SUSPENSION)
PLAINTIFFS
AND
THE NATIONAL EXECUTIVE COUNCIL
FIRST DEFENDANT
AND
THE RIGHT HONOURABLE MICHAEL NALI, MP
ACTING PRIME MINISTER OF THE INDEPENDENT STATE OF PAPUA NEW GUINEA
SECOND DEFENDANT
AND
THE HONOURABLE SIMON KAUMI MP
MINISTER FOR PROVINCIAL AND LOCAL GOVERNMENT AFFAIRS
THIRD DEFENDANT

Waigani

Akuram J
5-6 November 1998
10 November 1998

ADMINISTRATIVE LAW – Judicial Review of National Executive Council (NEC) Decision provisionally suspending Oro Provincial Government – whether ultra vires its powers.

CONSTITUTIONAL LAW – purpose of Section 187E (as amended) of the Constitution - (Amendment No. 16/95) - meaning of “Parliament”- to be read in the light of other sections of the Constitution and Organic Law on National Government and Local- Level Government Divisions 8 & 9 of Part III, Sections 51 to 58.

Counsel

Mr A. Jerowai for the Plaintiffs.

Messrs J. Kawi and Joe Fragi for the Respondents.

AKURAM J: This is an application for judicial review of the decision of the National Executive Council (NEC) to provisionally suspend the Oro Provincial Government on the 14th September 1998. Such suspension was effected under Section 187E (as amended) of the Constitution and Section 58 of the Organic Law on Provincial Governments and Local-Level Governments (OLPGLLG).

An application for leave to review was considered and granted for this review on the 16th September 1998.

The grounds for the provisional suspension are:

a) Gross mismanagement of the financial affairs of the province and widespread corruption;

b) Breakdown in the administration of the province; and

c) Deliberate and persistent frustration and failure to comply with the lawful directions of the National Government.

The Plaintiffs in support of their application tendered and relied on the affidavit evidence of:

a) Hon. S. Siembo, sworn on 28/9/98 and filed on 6/10/98;

b) Hon. S. Siembo, sworn on 6/10/98 and filed on 6/10/98 in regards to typographical errors; and

c) The Appendices to the Originating Summons - “A” & “B” comprising of the allegations and their responses.

The Respondents’ evidence in support of their arguments against the review were from the affidavits of:

a) Hon. S. Kaumi, sworn on 5/11/98; and

b) Colin Travertz, sworn on 8/8/98; and

c) Mairi Maroroa, sworn on 8/9/98.

The brief facts are that prior to the suspension, allegations were levelled against the Oro Provincial Government, its Governor and some of the public servants. Those allegations in summary amounted to allegations of “gross financial mismanagement” and “gross abuse of the Governor’s political powers” (see Appendix “A” to this Originating Summons).

By a letter of 23/5/98, the Minister summoned the Governor to appear before him on the 15th June 1998 in respect of the said allegations. On the Governor’s appearance on the 15th June 1998, the Minister served the allegations.

The Minister, at the same time, directed the Governor to reappear before him within 14 days from the 15th June. On the 29th June 1998 the Governor reappeared before the Minister with written responses which were contained in Appendix “B” of this Originating Summons.

The Plaintiff now alleges, which is denied by the Respondents, that because the responses were lengthy, the Minister and his officials will consider the responses and will notify the Governor to reappear before the Minister to take him though the responses. However, no more was heard from the Minister until the provisional suspension of the Provincial Government. Further, the evidence in support were not cogently sufficient to support the suspension.

Another related issue was the appointment, revocation and reappointment of the Provincial Administrator(s), Mr Gerari and Mr Maroroa.

The Plaintiffs are now seeking to quash the National Executive Council’s decision to provisionally suspend the Oro Provincial Government on the grounds which raise the following issues:

a) That the Third Defendant and subsequently the First Defendant failed, neglected or omitted to afford Plaintiffs; particularly the Governor, a hearing as required under Sections 56 & 57 of the OLPGLLG and therefore were in breach of the said provisions as well as the rule of natural justice known as “Audi Alteram Partem”.

b) That the Third Defendant had acted with bias and unduly influenced the First Defendant to suspend the Oro Provincial Government (OPG).

c) That the Defendants jointly or severally failed or omitted to satisfy themselves of the sufficient cogency of the said allegations in the light of the said responses without further meeting with the Governor before reaching the said decision to suspend the Oro Provincial Government.

d) That even if satisfied of the sufficient cogency of the said allegations, the Defendants jointly and severally failed, neglected or omitted to consider if the said allegations can only be put right by suspension of the Oro Provincial Government as is required under Section 58(d) of the Organic Law on Provincial Governments and Local-Level Governments (OLPGLLG).

e) As in (d) above, the defendants erred in holding that those matters contained in these allegations could only be put right by the suspension.

f) That the Third Defendant committed an error of law when he gave reasons, other than those contained in the original allegations leading to the provisional suspension of the Oro Provincial Government.

The relevant Constitutional provisions in relation to the provisional suspension of the Provincial Governments are Sections 187(E (1) & (2) and Sections 54, 55, 56, 57 and 58 of the Organic Law.

Section 187E of the Constitution on the “suspension of Provincial Governments and Local-Level Governments” was amended in 1995 by Amendment No. 16 of 1995 and certified on the 19th August 1995 which repealed and replaced the old Section 187E. The Plaintiffs’ counsel was not availed of this amendment until the Defendants’ counsel provided a copy to him. This is pertinent to the question whether the Respondents’ decision was ultra vires the Constitution and Organic Law.

For the purposes of the arguments raised, I set out the repealed and the new provisions of Section 187E as follows:

187E Suspension of provincial governments (old)

(1) Parliament may, by an absolute majority vote, suspend a provincial government if:

(a) there is wide-spread corruption in the administration of the province; or

(b) there has been gross mis-management of the financial affairs of the province; or

(c) there has been a break-down in the administration of the province; or

(d) there has been deliberate and persistent frustration of, or failure to comply with, lawful directions of the National Government.

(2) An Organic Law may make provision for an independent Commission and its powers, functions and procedure to investigate and to report to the Parliament on the circumstances of a provincial government before the Parliament exercises the power under Subsection (1) to suspend the provincial government.

(3) An Organic Law may make provisions for further defining any matter referred to in Subsection (1) (a), (b), (c) or (d).

(4) The National Executive Council may suspend a provincial government that cannot carry out its functions effectively because of a war or of a national emergency declared under Part X affecting the province or the whole of the country.

(5) While a provincial government is suspended, its powers and functions are vested in and shall be exercised by or on behalf of the National Executive Council, in accordance with an Organic Law.

(6) Where a provincial government is suspended:

(a) in the case of a suspension under Subsection (4), the Minister responsible for provincial affairs shall, as soon as practicable and in any event not later than the first meeting of the Parliament after the suspension, table in the Parliament a report on the suspension, the reasons for it and the circumstances of it; and

(b) at each meeting of the Parliament during the suspension the Minister responsible for provincial affairs shall report to the Parliament on the measures taken to re-establish the provincial government.

The new Section 187E reads:

187E SUSPENSION OF PROVINCIAL GOVERNMENTS AND LOCAL-LEVEL GOVERNMENTS (No. 16 of 1995)

(1) Where a Provincial Government or a Local-Level Government undermines or attempts to undermine the authority of the National Parliament or the national unity, the National Executive Council may provisionally suspend the Provincial Government or the Local-Level Government concerned subject to confirmation by an absolute majority vote of the Parliament.

(2) An Organic Law may make provision for and in respect of the procedures to be followed in the exercise of the powers under Section (1).

(3) An Organic Law may make provision for further defining any matter referred to in Subsection (1).

(4) The National Executive Council may suspend a Provincial Government or a Local-Level Government that cannot carry out its functions effectively because of a war or national emergency declared under Part X (emergency powers) affecting the province, local-level government area or the whole of the country.

(5) While a Provincial Government or a Local-Level Government is suspended, its powers and functions are vested in and shall be exercised by or on behalf of the National Executive Council, in accordance with an Organic Law.

(6) Where a Provincial Government or a Local-Level Government is suspended:

(a) in the case of a suspension under Subsection (4), the Minister responsible for provincial government and local-level government matters, shall, as soon practicable and in any event not later than the first meeting of the Parliament after the suspension, table in the Parliament a report on the suspension, the reasons for it and circumstances of it; and

(b) at each meeting of the Parliament during the suspension, the Minister responsible for provincial government and local-level government matters shall report to the Parliament on the measures taken to re-establish the Provincial Government or the Local-Level Government, as the case may be. (emphasis added).

Pursuant to Subsection 187E(2) of the Constitution, an Organic Law was enacted and made provisions for and in respect of the procedures to be followed in the exercise of the powers under Subsection (1).

These provisions are in Sections 54 to 68 but more particularly Sections 54 to 58 which I set out below:

Division 9. – Suspension of Provincial Governments and Local-level Governments

Subdivision A. – Suspension Generally

54. APPLICATION OF SUBDIVISION A

(1) This subdivision applies in relation to the suspension of a Provincial Government or a Local-level Government on a ground set out in Section 187E(1) (suspension of Provincial Governments and Local-level Governments) of the Constitution.

(2) This subdivision does not affect the operation of Section 187E(4) of the Constitution.

55. GROUNDS OF SUSPENSION

A Provincial Government or a Local-Level Government may be suspended on a ground set out in Section 187E(1) (suspension of Provincial Governments and Local-level Governments) of the Constitution. (emphasis added).

56. POWERS OF MINISTER WHERE HE IS OF THE OPINION THAT A GROUND FOR SUSPENSION MAY EXIST

Where the Minister responsible for provincial government and local-level government matters if of the opinion that the ground for suspension of a Provincial Government or a Local-Level Government exists or may exist, he may:

(a) require:

(i) in the case of a Provincial Government, the Provincial Governor;

or

(ii) in the case of a Local-level Government, the Provincial Governor and the head of the Local-level Government concerned,

to appear before him and “give an explanation of any matters” which have come to the attention of the Minister; and

(b) report to the National Executive Council on any matters which appear to constitute grounds for suspension of the Provincial Government or the Local-level Government. (emphasis added)

57. DUTIES OF NATIONAL EXECUTIVE COUNCIL ON SUBMISSION OF REPORT, ETC

The National Executive Council shall consider any report and comments submitted under Section 56(b) and may:

(a) cause the Minister to make further inquiries; and

(b) require:

(i) in the case of a Provincial Government, the Provincial Governor;

or

(ii) in the case of a Local-level Government, the Provincial Governor and the head of the Local-level Government concerned,

to attend before it and make explanations. (emphasis added).

58. NATIONAL EXECUTIVE COUNCIL MAY SUSPEND A PROVINCIAL GOVERNMENT OR A LOCAL-LEVEL GOVERNMENT

Where, after considering:

(a) the report and comments submitted under Section 56(b); and

(b) any further report or an explanation which it may have required under Section 57,

the National Executive Council is of the opinion that:

(c) the ground for suspension exists; and

(d) the matter can only be put right by suspension,

the National Executive Council may, by notice in the National Gazette, provisionally suspend a Provincial Government or a Local-level Government.

I am satisfied from the evidence that the Minister has properly complied with and did what Sections 56 and 58 required of him. I am also of the view that Section 57 will only apply if National Executive Council (NEC) is not satisfied with requirements under s. 56(b). I therefore find no error of law here.

However, Sections 54(1) and 55 of the Organic Law say that a Provincial Government or Local-level Government may be suspended on a ground set out in Section 187E(1) of the Constitution (as amended). The old or repealed provisions of Section 187E has four (4) grounds whereas the new Section 187E (No. 16 of 1995) has only two grounds. These are:

(i) Where the Provincial Government or the Local-Level Government has undermined or attempted to undermine the authority of the “National Parliament”; or

(ii) Where the Provincial Government or Local-Level Government has undermined or attempted to undermine “National Unity”;

the National Executive Council may provisionally suspend the Provincial Government or Local-level Government. The Organic Law provisions of Section 56 to 58 then sets out the procedure for provisional suspension.

The question is where do the grounds in the repealed Section 187E of this Constitution fit in. Section 187E of the old provision, subsection (1)(a), (b) & (c) are concerned with the actions of the Provincial Government and (1) (d) & (e) deals with the Provincial Government’s persistent frustrations of or failure or disobedience of applicable laws including the Constitution or an Organic Law, the Provincial Constitution or any legislation applicable to the province. The answer to this question can be found in the Organic Law.

The Organic Law under Division 8 – “withdrawal of powers, functions and finances of the Provincial and Local-level Governments” deals with those grounds set out under the repealed section 187E(1). These are set out in Sections 51 to 53 which I set out below:

51. WITHDRAWAL OF POWERS, FUNCTIONS AND FINANCES

(1) Where there are findings by:

(a) the Auditor-General:

(i) of corruption or abuse of power within a Provincial Government or a Local-level Government so as to render the government either ineffective or lacking in public respect and confidence; or

(ii) of failure by a Provincial Government or a Local-level Government to keep or cause to be kept proper accounts and records of transactions or dealings; or

(iii) that a Provincial Government or a Local-level Government has an ineffective internal control system; or

(iv) that a Provincial Government or a Local-level Government has failed to submit reports as required by law; or

(b) the Minister responsible for provincial and local-level government matters, or a Special Investigating Committee appointed for the purpose by the National Executive Council that:

(i) there has been a breakdown in the administration of a province or local-level government area; or

(ii) there has been deliberate and persistent frustration of or failure to comply with lawful directions of the National Government; or

(iii) Provincial Government or a Local-level Government has deliberately and persistently disobeyed applicable laws, including the Constitution, an Organic Law (including this Organic Law) or any national legislation applicable to the province or local-level government area; or

(iv) there has been a failure to carry out functions in accordance with the development policies and standards of the National Government,

the National Executive Council shall direct the Provincial Government or the Local-level Government concerned to rectify the matter and such direction shall specify the manner and time in which such rectification is to be carried out.

(2) Where a Provincial Government or a Local-level Government refuses or fails to comply with a direction issued under Subsection (1), the National Executive Council may:

(a) withdraw all or any of the powers and functions of; or

(b) withdraw and withhold all or any finances to; or

(c) withdraw all or any of the powers and functions of, and withdraw and withhold all or any finances to,

the Provincial Government or the Local-level Government, as the case may be.

3. This section does not prevent the Auditor-General, the Minister responsible for provincial government and local-level government matters, or the Special Investigating Committee, as the case may be, from referring any person, including members of a Provincial Government, a Local-Level Government or any other person, to the Ombudsman Commission, the Public Prosecutor, the Police or any other relevant authority for further investigation and action. (emphasis added).

52. RETURN OF POWERS AND FUNCTIONS

Subject to Section 53, the National Executive Council may, on the recommendation of the Minister responsible for provincial government and local-level government matters, given after receiving a report from the Auditor-General, the Minister responsible for provincial government and local-level government matters or the Special Investigating Committee, recommending the return of the powers and functions, direct that, with effect from a specified date, the Provincial Government or the Local-level Government is authorised to exercise all or any of the powers and functions withdrawn in accordance with Section 51.

53. COMPLIANCE WITH CERTAIN CONDITIONS

(1) A Provincial Government or a Local-level Government to which Section 52 applies, for the period specified by the National Executive Council, shall:

(a) submit all its proposed financial estimates, including any Bill appropriating monies, to the National Executive Council for approval; and

(b) provide such reports, to the National Executive Council, on the financial management and other related matters as the Council may, from time to time, require.

(2) In addition to the requirements under Subsection (1), except with the prior approval of the National Executive Council, a Provincial Government or a Local-level Government shall not transfer funds from one activity or project item to another during the period specified in that subsection.

So if there are any widespread corruption in the administration of the province, or gross mismanagement of the financial affairs of the province, or a breakdown in the administration of the province, or persistent frustration or failure or disobedience of the lawful directions of the National Government or any applicable laws including the Constitution, Organic Law, Provincial Constitution or any national legislation applicable to the Provincial Government, the National Executive Council, under Section 51(2), may take any of the actions mentioned in Section 51(1) (a), (b) or (c). National Executive Council may also, subject to Section 53, recommend returning of the powers and functions to the Provincial (or Local-level Government) within a specified date. The National Executive Council shall also do any of the things mentioned in Section 53(1) and (2) of the Organic Law. That is, the Provincial or Local-level Government should not transfer funds from one activity or project item to another during the period specified in that period.

So if Sections 51, 52 & 53 of the Organic Law specifically provided for the procedures in dealing with the grounds specified in the repealed Section 187E(I) of the Constitution, the intention of the Parliament in replacing the old section 187E(1) is to deal with any administrative and financial matters according to the administrative and financial procedures already in place and not to allow any political interference in these areas. That is why the new Section 187E only has two grounds which I will now discuss.

Section 187E(1) (Amendment No. 16/95) says the ground is where the Provincial Government or Local-level Government undermines or attempts to undermine the National Parliament. What does National Parliament mean? The Interpretation Act, Chapter 2 defines “Parliament” to mean “the National Parliament established by Section 99 of the Constitution. Section 99 sets out the “Structure of the Government” and reads:

(1) Subject to and in accordance with this Constitution, the power, authority and jurisdiction of the people shall be exercised by the National Government.

(2) The National Government consists of three principal arms, namely:

(a) The National Parliament, which is an elective legislature with, subject to the Constitutional Laws, unlimited powers of law-making; and

(b) The National Executive; and

(c) The National Judicial System, consisting of the Supreme Court of Justice and a National Court of Justice, of unlimited jurisdiction, and other Courts.

(3) In principle, the respective powers and functions of the three arms shall be kept separate from each other.

(4) Subsection (2) is descriptive only and is non-justiciable.

In order to put this distinction between the three principal arms of the National Government into reality, the Organic Law separated those functions of the legislature and the executive in Sections 51, 52, 53 and 54 to 58 in dealing separately with any anomalies created by the Provincial Government or Local-Level Government in Divisions 8 & 9 of Provincial Government Part III of the Organic Law. This intention is very clear in Section 51(1)(b) (i) to (ii) repeating the same grounds for suspension under Section 187E of the Constitution (see above) but says that “the NEC shall direct the Provincial Government or Local Level Government concerned to “rectify the matter” and such direction shall specify the manner and time in which such rectification is to be carried out”.

The National Parliament did not intend to suspend a Provincial Government. That is why those grounds for suspension under the old section 187E has been repealed and placed in Section 51(1) of the Organic Law so that they can be dealt with administratively. Instead it allowed three persons or authorities to deal with any anomalies created. They are the Auditor-General, the Minister responsible for Provincial and Local-Level Government and the Special (or National) Investigating Committee who may refer any person or member of the Provincial or Local-level Government to the Ombudsman Commission, the Public Prosecutor, the Police or any other relevant authority for further investigation and action. What the Parliament has intended is to let the administrative and financial matters be dealt with by the Executive arm of the Government who has a system already in place. In its stead the new Section 187E has only two grounds for suspension of Provincial or Local-level Government.

The next question is, does the present grounds (see above) for the provisional suspension of the Oro Provincial Government fall under Section 187E. That is, does:

(a) gross mismanagement of the financial affairs of the Province and widespread corruption,

(b) breakdown in the administration of the Province and

(c) deliberate and persistent frustration and failure to comply with lawful directions of the National Government

undermine or attempt to undermine the National Parliament.

From the discussions above, I would say no. This is because the National Parliament has intended that Sections 51 to Section 53 of the Organic Law deal with those grounds administratively and not by way of suspension. The only way now is for the Minister to wait for the Special (or National) Investigating Committee’s report and if those grounds are substantiated, recommend to appropriate authority such as the Police etc. to deal with any person or persons, etc. through the existing laws and administrative structure already in place. Furthermore, the administrative structure comes under the Executive Arm and not National Parliament or legislature.

In view of the above reasons, I make following findings:

1. That the Minister for Provincial and Local-level Government was correct in properly exercising his powers under Sections 56 and 57 of the Organic Law by requiring the Governor to appear before him and give explanations to allegations raised. The Governor’s explanations whether written or oral is sufficient unless National Executive Council directs him to do so under Section 57.

2. That the Minister for Provincial Government and Local-level Government had acted beyond the powers given him under Section 56(b) to refer the reports to the National Executive Council and not in accordance with Sections 51, 52 & 53 of the Organic Law. In this regard, Minister has acted contrary to procedures under Sections 51, 52 & 53 of the Organic Law.

3. That the Third Defendant, Minister, committed an error of law when he gave reasons other than those contained in the original allegations leading to the provisional suspension in contravention of Section 56(a) of the Organic Law by not instructing the Governor to explain.

4. In view of (2) and (3) above, Minister has acted ultra vires his powers under Section 187E(1) and Sections 51, 52, 53, 55, 56 of the Organic Law.

5. In view of (2) (3) and (4) above, the National Executive Council has acted ultra vires the Constitution (Section 187E(1)) and Section 58 of the Organic Law.

In view of the above reasons and findings, I make the following orders.

1. That the application for Judicial Review is granted.

2. The NEC decision to provisionally suspend the Oro Provincial Government is quashed.

3. That the Oro Provincial Government be restored to its full executive status forthwith.

4. That the Special or National Investigating Committee carry out its investigation without hindrance and with full co-operation from the reinstated Oro Provincial Government, its agents or servants.

5. That costs follow the event to be taxed if not agreed.

Lawyer for the Plaintiffs: Jerowai Lawyers

Lawyer for the Defendants: Solicitor-General.


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