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State v Kuli [2006] PGNC 1; N3057 (10 March 2006)

N3057

PAPUA NEW GUINEA

[IN THE NATIONAL COURT OF JUSTICE]

CR 399 OF 2004

THE STATE

v

KUK KULI

Waigani : Sakora J
2006 : 4, 15, 16, 17, 20, 21, 22, 23
February, 10 March

CRIMINAL LAW – Misappropriation – Member of Parliament – Funds for specific purpose – No evidence of written request or application – Public Funds – No discretion as to use of – Criminal Code Act, s 383A. Gaming Machine Act 1993, ss 3, 17, 18, 61, 63, 67 & 73A – Public Finance (Management) Act, ss 8, 9, 10, 11, 15, 48, 52, 62 & 64.

Counsel:
D Mark, for the State.
G Sheppard & N Eliakim, for the Accused/Defendant.

10 March 2006

1. SAKORA J: The accused was charged with ten (10) counts of misappropriation by the presentation of an indictment on 14 February 2006. Before arraignment the State sought leave to withdraw count (7) as it was not intended to call any evidence in respect of the allegations in this count. Leave was then granted to withdraw the count. After arraignment, State counsel once again sought leave to withdraw count (10) of the indictment as the State indicated it had no evidence to call in respect of the allegations contained in this count. Leave was similarly granted.

2. There was left, therefore, only eight (8) allegations of misappropriation for the State to proceed against the accused. In proof of its allegations, the State, first of all, had tendered into evidence by consent a total of 94 documents (the Defence had two documents tendered without objection during the cross-examination of State witnesses). State then called seven (7) witnesses who gave sworn oral evidence.

3. After an unsuccessful No Case submission, Defence went into evidence, calling five (5) witnesses (including the accused) to give sworn oral evidence.

4. The State’s case centres around the use of the proceeds of three (3) cheques issued by the National Gaming Control Board (NGCB) drawn on its Bank South Pacific (BSP) accounts in favour of Ela Motors, a motor vehicles dealer located here in Port Moresby as well as other centres outside the National Capital District (NCD). It is the State’s case that these cheques were issued following requests (by application) to the NGCB for funding to purchase an ambulance for his electorate, Anglimp-South Wahgi Open, in the Western Highlands Province.

5. The cheques were handed over to the accused personally on three (3) separate occasions, on 16 April 1999 for a sum of K35,000, on 1 June 1999 for K58,600, and on 1 September 1999 for K81,940, giving the grand total of K175,540. These cheques were processed during the tenure of two (2) different Registrars of the NGCB: Mr Paul Aisa the first two cheques, and Dr Jacob Jumogot the third cheque.

6. The accused received these cheques because at the time he was the elected member representing the Anglimp-South Wahgi Open seat in the National Parliament in the 1997 – 2002 Parliament. He received these funds from the NGCB because this public body that had been set up by legislation, the Gaming Machine 1993 (s 3), for the “legalization and control of gaming machines and their operation and for related purposes” (Preamble to the Act), operated a Trust Account from which funds were made available to parliamentarians for various public purposes such as health services, sports and other community development projects.

7. Into this Trust Account were (are) deposited funds received by the NGCB (interchangeably with “the Board”) from the operation of approved gaming machines, pursuant to the prescribed fees for licences and permits under s 61 and s 63, and the costs of monitoring the machines under s 73A of the Gaming Machine Act 1993. Furthermore, funds also came (come) from the operation of those machines pursuant to the provisions of s 67 of this Act (Distribution of profits).

8. And the operation of this account would appear to be authorized by the combined effects of s 10, s 11, s 15 and s 52 of the Public Finance (Management) Act, the Board being a “public body” as envisaged by Part VIII of this Act (s 48 and s 62), and s 17 of the Gaming Machine Act (supra). Section 18 of the Act establishes the office of the Registrar to the Board, and the Registrar is appointed by the Minister by notice in the National Gazette (s 18(2)), and he is the Secretary to the Board, carrying out and performing the functions and duties required of him under the Act or by the Board (s 19).

The State Case

9. Of the remaining eight (8) counts in the indictment, it is the State’s allegation that a total of K91,689.60 were misappropriated by the accused, by applying to his own use monies totalling K76,576.32, and to the use of another person (John Oie, count 4) the sum of K15,112.68.

10. There is no dispute that the three (3) cheques (supra) were collected by the accused, and there is also no dispute that these cheques were taken directly to Ela Motors (the payee on those cheques) where an account in the name of the accused was opened with these cheques. There is no dispute also that out of these funds (totalling K175,540), the accused proceeded to negotiate the purchase of five (5) motor vehicles. Once again there is no dispute as to the make, description, registration and insurance details of these five (5) vehicles. And the State alleges that it is these transactions and purchases that constituted misuse or misappropriation of funds as envisaged by s 383A of the Criminal Code Act as described in the eight (8) counts.

11. The evidence of the two (2) Registrars, whilst confirming the collection of the three (3) cheques following telephonic advice to the accused, outlined, more particularly in Mr Aisa’s case, the procedures undertaken in requests for funds from the Board by parliamentarians, and the disbursement of these funds. It was Mr Aisa’s evidence that formal applications stating the purpose(s) for these funds would have to be made to the Board. Elaborating on this he added:

We would not fund anything apart from health or the Cheshire Homes, donations to foundations, heart foundation or sporting organizations. Only requests for those purposes are approved by the trustees.

12. And in relation to the transmission of these applications to the Board, this witness said that some of the applications came directly through three (3) channels: Ministries of Finance and Treasury, and the Office of the Prime Minister. When applications came direct from individuals, “we would direct them to those three (3) offices for their approval before processing them”, Mr Aisa said. Whilst the witness was unable to recall the proportion of applications from various organizations and individuals, he stated that “quite a lot of members of parliament would also request funds through the two (2) ministries for funding of ambulances and quite a number of other community projects including school buildings, other health centres, and water supplies”.

13. After identifying the two (2) cheques he released to the accused (Exhibits “B” and “D” for K35,000 and K58,600 respectively), this witness confirmed his statement to the police made on 16 December 2003 (during their investigations) that those two (2) cheques were given to the accused “for the purchase of ambulances”. He was replaced in July 1999 by Dr Jumogot.

14. In cross-examination he was asked about a Trust Deed, and agreed that any particular payment made out of the trust account had to be in accordance with the requirements of the Trust Deed. However, he did not have a copy of that Trust Deed, though he had mentioned this to the police in his statement (supra). In relation to the two cheques it was his recollection that he had received a written authority and direction to make both of those payments. In answer to further questions by Defence counsel, the witness confirmed that in any written authority and direction from the two (2) ministries and the office of the Prime Minister (supra) thus:

In those written instructions, they would specify what they have approved for me to release. If they have approved for a specific project, they would state it in that letter.

15. Mr Sheppard of counsel for the accused referred the witness to a letter from the then Deputy Prime Minister and Treasurer and Minister for Planning (Mr Iairo Lasaro) dated 21 May 1999 (Exhibit/Doc. “90”) directed to him in relation to a request from the accused “seeking financial assistance for a rural project in his electorate”, and instructing the disbursement of K50,000.00. This was not related to the cheques and funds under consideration here, but the witness acknowledged that this was the type of authority and direction that came from those three (3) official sources (supra), though he was unable to produce any documentation such as a request from the member indicating the purpose of the funds. He agreed also that he could not produce any supporting documentation in respect of the two (2) cheques that he processed and released to the accused (supra).

16. Dr Jumogot’s evidence was in relation to the third cheque (for K81,940). He replaced Mr Aisa as Registrar in July of 1999. After stating that all records and reports of the NGCB had been removed or missing before he assumed office, he recalled attending to financial assistance for the accused as the then member of parliament for Anglimp-South Waghi Open electorate:

Yes, the application or the request was made by the member to buy an ambulance for his electorate and the application was sent to the Gaming Control Board who then approved his application for funding for his ambulance.

17. The witness further added that upon approval (by the NGCB) a cheque was raised and attached to a letter to the member informing him that his application had been approved to pay for the ambulance (Exhibits “F” and “F1”).

18. In cross-examination he admitted he had not in his possession the accused’s letter of request for funds. In relation to Mr Sheppard’s question as to how the sum of K81,940 was determined, the witness responded that the funds requested had been obtained by the Member from Ela Motors with his letter of request. When counsel suggested that the accused had made no requests for funds, the witness responded:

Well, and I can say is that, if there is no request from the member to the Gaming Board to pay for the ambulance then the Board could not make the cheque to him or to Ela Motors to pay for the ambulance.

19. It is instructive to reproduce hereunder the next question and answer in cross-examination:

Q: Now, I am instructed by Mr Kuli that he did not write a letter of request and he did not obtain a quote for K81,940. And that he was telephoned to come and pick up a cheque and he was told that it was for financial assistance in his electorate which are the very words in your letter.

1. So what is your question, what are you asking me?
   
17. Could you make some effort to produce that letter of request?
1. We will have to ask the National Gaming Control Board to produce this letter.
   

20. The State case also relied on the evidence of the First Assistant Secretary for the Department of Treasury, Mr Matatia Saroa. This witness was in the Financial Inspection Division, whose duties and responsibilities involved in directing and monitoring the investigations and audit functions of the department. Its jurisdiction covered national government departments as well as statutory bodies or governmental organizations such as the NGCB.

21. When asked about his familiarity with the procedures involved in processing applications for assistance from the NGCB, Mr Saroa described it thus:

Firstly, when the applications for financial assistance are received, the applications are recorded in the register. Then the applications are submitted to the management, the management screens and recommends either rejection of the applications or approval to the board and the board deliberates on the applications, and the board approves the applications. Any that is rejected, the applicants are advised accordingly. Any that is approved, the board approves any financial assistance only up to the extent of K100,000 And beyond that are referred to the Minister for Finance.

22. Then the witness dealt with the administrative processes of checking supporting documentation, raising the necessary requisitions for payment cheques which, once processed are released to the registry for disbursement. Cheques for donations are directed to the beneficiaries concerned whilst cheques for goods and services are directed to the suppliers. Upon receipt of cheques the beneficiaries and suppliers are expected to acknowledge payments. The witness added that the applicants such as the accused are expected “to expend the subsidies or grants applied for through the board for the purposes they were applied for in the first place. Otherwise in the future assistance may be denied”.

23. Two State witnesses, William Penias and Francis Elipa, had their police statements tendered and admitted into evidence by consent. Their statements were in respect of the motor traffic registry records (in respect of the 5 motor vehicles) held at Boroko (NCD) and Mt Hagen Motor Traffic Offices respectively (Exhibits/Docs. “92” and “89” respectively).

24. Another State witness, Albert Essau had his statement tendered and admitted into evidence by consent (Exhibit/Doc. “93”). Mr Essau, an Investigations Officer with BSP Limited, made the statement in respect of his search and production of the three (3) cheques in question (supra), together with a Bank Statement in the National Government Trust Account No. 1000069101 (Exhibits “B”, “D”, “F” and “gg” respectively), pursuant to a Search Warrant (371/02) executed by the police on 7 October 2002.

25. The last two State witnesses who gave sworn oral evidence were witnesses from the electorate of Anglimp-South Waghi Open. Mr Joseph Dopil was and is the District Officer for the Anglimp District. After some confusing and irrelevant questioning from the State counsel, this witness finally mentioned a motor vehicle, a Kijang that had been bought in 1999 by the accused for the Kindeng Health Centre in the electorate. It had been used for a short time and what happened after that, he was not aware. Apart from this, the witness appeared to have lost his power of recall. In cross-examination he confirmed or rather demonstrated once again his loss of power of recall.

26. The last State witness, Kimen Gokumi, was the assistant District Administrator for Anglimp-South Waghi between October 1998 and November 1999. As part of his duties he assisted the accused as Member of Parliament with projects within the electorate, and he mentioned some of the projects. But he said that he did not assist in “processing projects” (whatever this may mean) that required the member’s funding. In relation to ambulance for the electorate, his response was that “they must have been purchased it earlier. I came into the office later”. But he did refer to the ambulance for the Kindeng Health Centre.

27. When asked about a Musso 4 wheel-drive registration number BAQ 553, the witness said he did not see his vehicle in the electorate; in relation to another vehicle, a Toyota Landcruiser registration number BBA 880, he said he saw this vehicle but it was not used as an ambulance but by the Peace and Good Order Committee. And he added the office of the former member (the accused) took care of this vehicle. However, the witness recalled seeing a Mitsubishi L300, a 12-seater bus registration number CAK 448 being used as an ambulance for the Rombal Haus Sik.

28. Finally when asked about a Mitsubishi L200, registration number BAS 259, he only remembered the ones he had described earlier.

The Defence Case

29. The Defence case relied largely on the absence of the relevant documentation evidencing a formal application from the accused for funds from the NGCB. Therefore, the three (3) cheques that he received were not for any particular specific purpose but to use the proceeds “to buy any vehicle he wanted from Ela Motors”. And, in any case, it is contended, in the absence of the Trust Deed from which the terms and conditions for the disbursement of funds from the Trust Account could be determined the accused was quite at liberty to apply the proceeds of those cheques any way he wished, and that is exactly what he did.

30. Thus, it is contended, no misappropriation took place, and, further, that an important element of the offence, dishonesty, could not properly be attributed to the accused. The proceeds of the cheques deposited with Ela Motors were, therefore, legitimately spent buying the motor vehicles in question and shipping to Lae for delivery to his electorate. It is the Defence case also that, because of the absence of the relevant “paperwork” (in Mr Sheppard’s words), except the three (3) cheques and Exhibit “F1” (Dr Jumogot’s letter, supra), the accused was entitled to use the funds also for insurance, shipment and registration costs, as well as cash hand-outs for future maintenance costs.

31. In support of these contentions, all intended to point towards innocence due to lack or insufficiency of evidence establishing guilt, the Defence called five witnesses (including the accused himself) to give sworn oral evidence.

32. The evidence of the accused was prefaced by his assertion that he was illiterate, could not read nor write English, and that he had, in any case, difficulty with Tok Pisin such that he would often mix it up with his own local dialect. This was to suggest that he was not conversant with the ways and means of being a parliamentarian, and being involved in the negotiations that must surely have taken place after the receipt of the three (3) cheques that led to the purchase of the motor vehicles and associated subsequent transactions.

33. From this lack of basic literacy skills, it was his evidence that he had never formally applied for funds from the NGCB for any particular or specific purpose(s) as alleged by the State. The first occasion he said he became aware of the three (3) cheques was when the two (2) Registrars rang him at Parliament House and advised him that he had cheques to be picked up from them. So, without the knowledge and assistance of any one or more of his three (3) personal staff members, he proceeded to the NGCB offices in downtown Port Moresby where he picked up the cheques on those three (3) separate occasions.

34. It was the accused’s evidence also that when handing over the cheques, the two (2) Registrars had told him to go to Ela Motors and buy whatever motor vehicles he wanted. This was, he said, in response to his query as to what the cheques were for. He had been surprised but happy with the cheques, suggesting presumably an unexpected, unintended, “windfall”, so much so that he was moved to hug Mr Paul Aisa on the first occasion.

35. The accused stated that no other documents accompanied the cheques, nor any advice as to any conditions apart from the buying of motor vehicles. He repeated that neither he nor any of his staff members had requested any funding from the NGCB. When asked by his counsel as to what he did with the cheques when he went to Ela Motors, he responded:

“I put the cheque at Ela Motors and started looking for cars. Costs were too high, amount on the cheque not too high. Searched and found vehicle at Toba Motors.”

36. The vehicle he found, and the first of five (5) that he ended up purchasing was a Musso 4 x 4 station wagon that he paid for with a cheque from Ela Motors. The vehicle cost K20,800, and it was to be sent to his electorate to be used there, “in the districts for people in the office”, but because he said the vehicle was bad for lack of spare parts, he sold it to Boroko Motors for K18,000.

37. The second cheque he received from Mr Aisa (for K58,600) on 12 June 1999 followed the same path as the first which had been in the sum of K35,000 (supra). Once again he had been surprised but happy and:

“I hugged Mr Aisa, thinking, Members of Parliament do get a lot of money”.

38. The accused took the cheque to Ela Motors and “left it there and later got a vehicle” for the electorate. The vehicle happened to be a Toyota Landcruiser that he said was used by the Peace and Good Order Committee, magistrates and councillors. His evidence also indicated he gave K25,000 cash from the “left-over from vehicles purchased from Ela Motors” to the Anglimp High School. Asked as to whether he purchased any other vehicles from Ela Motors, the accused said three (3), making a total of five motor vehicles”

Musso 4 x 4 s/w, BAQ 553

Toyota L/C, BBA 880

Toyota Hiace bus, BBB 235

Mitsubishi bus, CAK 448

Mitsubishi utility, BAS 259.

39. The Toyota L/C was said to have gone to Pastor John Oie who later registered it in his own name as a public motor vehicle (PMV); the Mitsubishi bus was given to Tombil (Rombil?) Haus Sik; and, finally, the Mitsubishi utility was said to have been given to the Rural Community Services. And, as well as the purchases of the five (5) motor vehicles, as to what happened to them later, the accused told of certain cash handouts to various people in the electorate for such expenses as registration, insurance and maintenance in respect of those vehicles. He added that the monies “left-over I got and gave away”.

40. Rombil Haus Sik got K5,000 cash from the accused; similarly K4,000 to Pastor John Oie. These were justified thus:

“If I give vehicles only, how are they going to maintain those vehicles?”

41. In relation to the third cheque for K81,940 received from Dr Jumogot, similar story was related. Thus, the accused denied being given a letter together with the cheque (Exhibit “F1”). Finally, it was his evidence that he never used any of the funds the proceeds of the three (3) cheques for his own personal private purposes. Nor did he use any of the motor vehicles for his own private purposes.

42. Defence then called the current President of the Anglimp-South Waghi Local Level Government, Mr Wani Onum, a councillor of some 35 years service. He has known the accused since he was a councillor for a very long time before standing successfully for election to the 1997-2002 Parliament. This evidence was intended to demonstrate that the accused had indeed directed the funds to projects within his parliamentary electorate. For instance, there was the K25,000 cash handout to the Anglimp High School, of which this witness was the Chairman of the Board.

43. In relation to donations of motor vehicles, it was Mr Onum’s evidence that, first of all, he was aware of a 15-seater bus being given to the Assembly of God (AOG) Church at Kindeng, in which the vehicle was used by the Church as a PMV; secondly, a 10-seater Landcruiser given to the Peace and Good Order Committee and the Village Court; and, thirdly, a Mitsubishi L200 donated to the Nazarene Mission at Tun village. Finally, he was aware also that a Kijang had been given to the Kindeng Health Centre, as well as a small bus to the Rombil(?) Health Centre.

44. The next witness was Francis Rea, the first secretary to the accused when he was a member of parliament. He is a well-educated, articulate, former community development officer in the national public service. It was his evidence that his employment with the accused had been a very challenging one, because, amongst other things, he had to be with the member “all the time”, due to the member’s “wholly illiterate, cannot read or write” status or handicap. Mr Rea had to be with the accused all the time during parliamentary sittings, meetings and other public functions, advising and helping him. The position also entailed sending and receiving correspondence on behalf of the accused.

45. In relation to the three (3) cheques, it was Mr Rea’s evidence that he had been in the electorate on behalf of the accused at the relevant times, so he did not know anything about them. It was only later, during the investigations about those cheques that he became aware. So it would appear that on those three (3) occasions in April, June and September of 1999 when the NGCB cheques were handed over to the accused, his closest staff member was not with him. Nor had this staff member been aware of the various motor vehicles that had been purchased with the proceeds of those cheques.

46. The two (2) other Defence witnesses are Pastors, one of them, John Oie, being the subject of allegations contained in Count 4 of the indictment. They each gave evidence of receiving certain motor vehicles, the registration and insurance status of these, and to or for what purpose(s) these had been put. As well, each of the pastors gave evidence of cash being handed out by the accused at the time the motor vehicles had been delivered to them. All of these evidence had been intended to demonstrate the main Defence contention that the funds had not been misapplied or misappropriated as alleged by the State. The funds had come from the NGCB to the then member for no specific purpose(s) and that, therefore, the funds were to be used as and when he wished, and, that is exactly what he did, helping the two (2) pastors and other persons in his electorate with motor vehicles and cash handouts.

The Law

47. The court has been greatly assisted by the submissions of both counsel on the law on misappropriation with references to the relevant case law. Section 383A of the Criminal Code Act defines misappropriation in the following terms:

383A. Misappropriation of property.

(1) A person who dishonestly applies to his own use or to the use of another person –

(a) property belonging to another; or

(b) property belonging to him, which is in his possession or control (either solely or conjointly with another person) subject to a trust, direction or condition or on account of any other person,

is guilty of the crime of misappropriation of property.

(2) . . .

48. The law is quite clear on what constitutes (or constitute) misappropriation. And the pertinent case law referred to and relied upon by counsel enunciate and emphasize the applicable principles that do not need repetition here.

49. In relation to the issue of guilt or innocence, it is an important principle of our criminal justice system that it is for the State, the accuser, to prove its allegations against the accused and not for the accused to prove his innocence. And this is in consonance with the presumption of innocence and the protection against self-incrimination accorded by our Constitution [s 37(4)(a) and s 10) respectively]. Consequently, the State carries a very heavy burden, an onerous responsibility, to prove an accused person’s guilt.

50. This responsibility is required to be discharged at the highest standard of proof, that is, proof beyond reasonable doubt. This means that, if at the end of a trial the court is left with any doubt at all, any lingering doubt, as to the guilt of the accused, the law requires that the accused be extended the benefit of that doubt, and be declared not guilty and discharged.

Findings

51. In this case I have had, as noted above, the benefit of a great volume of documentary evidence: a total of ninety-four (94) documents were tendered by consent. There is no dispute about the receipt of the cheques, their respective amounts, whose property these were, and how the proceeds of these cheques were spent. The dispute is, as noted already, as to whether or not the way the funds were spent constituted misappropriation as envisaged by s 383A of the Criminal Code Act.

52. By way of repetition for emphasis, the Defence case was that because there was no specific documentation evidencing any specific purpose(s) for which those funds were given to the then member, the State cannot have established misappropriation as defined. Thus, it is argued, what was done by the accused cannot be contrasted with and compared against the requirements, the conditions, the terms, of or for the use of public funds.

53. It is the opinion and judgment of this court that in respect of each of the remaining eight (8) counts of the indictment, which I shall elaborate on in due course here, the State has discharged its onerous responsibility in proving the case against the accused beyond any reasonable doubt. I accept the evidence of the two (2) Registrars (of the NGCB) in relation to the disbursements of the funds the proceeds of the three (3) cheques, and the purpose for which these were disbursed to the accused. In this respect, I accept their evidence that there had been a specific request from the then member for financial assistance to buy ambulances for his electorate. I, therefore, disbelieve and discount the Defence evidence, and contention, that the three (3) cheques were given to the accused to use the proceeds from this as and when he wished.

54. I find and conclude that the funds were disbursed for a particular purpose: to purchase ambulances for the electorate, not to buy motor vehicles to be handed out to people and organizations that were not connected with rural health services. I do not accept, therefore, that this was not a case involving grants or disbursements of funds vesting discretion in the recipient to spend as and when he wished, as Mr Sheppard of counsel for the accused submits.

55. The accused was not given “an open cheque book”, as it were; a carte blanche in respect of those funds. Whatever may be advanced as explanation or justification, the fact remains that what we are talking about here are public funds that were intended to be put to specific/nominated purpose(s). Public funds are not (or should not be) handed out to be used whenever and however one wants. The disbursement (and the amount) must correspond directly to a public purpose.

56. I do not accept, therefore, that there was no specific application or request for funds from the NGCB by the accused. In my respectful opinion, the fact that the State produced no formal application or request is neither here nor there. There is no dispute at all that the accused received the three (3) cheques as described by the State evidence. And one of these cheques, for the amount of K81,940 (Exhibit “F”) is referred to directly in an NGCB letter to the accused, dated 1 September 1999 (Exhibit “F1” tendered by Mr Sheppard without objection on behalf of the Defence). The letter was under the hand of one of the Registrars, Dr Jacob Jumogot. Furthermore, it is my respectful opinion that the fact that the State did not produce what the Defence referred to as a Deed of Trust to demonstrate the formal guidelines for the disbursement of funds by the NGCB is of no consequence. The accused does not deny receiving public funds from the NGCB.

57. I find, as a telling point, that the evidence of the witnesses the accused called to support him in fact support the State case as to misappropriation as defined and alleged. The cumulative effect of all Defence evidence, including that of the accused himself as to how he applied the funds, is to demonstrate that, except for the purchase of motor vehicles to be used as ambulances by the Kindeng and Rombil Health Centres, the purchases of vehicles and giving of these to other persons and entities together with the case hand-outs constituted misappropriation. These, in my opinion, constituted diversion and use of public funds contrary to their proper and designated purposes.

58. As if the point needed further elaboration, it needs to be pointed out that the NGCB being a “public body” pursuant to the Public Finances (Management) Act (s2 Interpretation) and the Gaming Machine Act, is subject to the provisions of the former legislation. And that legislation, inter alia, makes provisions for the inspection and auditing to ensure accountability in respect of, first, the disbursement of public funds, and, secondly, the use or application of those funds (s 64).

59. I do not, therefore, accept the accused’s evidence that he made no request nor application for funds from the NGCB and that, therefore, he was surprised but happy to receive the three (3) cheques. It is my respectful opinion that the accused is not as uninformed as he and his counsel would have the court believe. He had been a local government councillor for many years, and was able to get himself elected to the National Parliament in an area or region where there is always intense political competition. He was a parliamentarian at the national stage for two (2) years before these funds were disbursed to him. It would, therefore, be not unreasonable to suggest that he would have had ample opportunities for, not to mention experience in, receiving public funds for electoral projects. And even if he were truly illiterate, could not understand English or Tok Pisin, he had three (3) personal staff members at public expense, including the witness Francis Rea who gave evidence that he was always with the accused.

60. The accused was, I conclude, fully aware of what was happening in respect of the three (3) cheques. The documentation tendered by consent (and, therefore, before me) had evidence of the accused’s writing of his name, and his signature, in some of them. Indeed, in response to a question from the Bench during his oral evidence, the accused was able to and did write his name and sign (Exhibit “Doc. 94”). These corresponded very much to the writings and signatures found on certain of the documents tendered into evidence by consent (supra). This conclusion thus makes sense of the very fact that upon receiving telephone calls from the two (2) Registrars, the accused proceeded to the Port Moresby offices of the NGCB, unaccompanied and unaided by any of his personal staff, received the cheques, took them to Ela Motors and “deposited” them into an account that he had opened with this car dealer, negotiated for and purchased certain motor vehicles as acknowledged in his own evidence (supra). There cannot be any doubt, therefore, that the accused knew exactly what he was doing, and that he was wise to the ways and means of being a national parliamentarian; what happens (or ought to happen) with public funds; and dealing with business people such as salespersons in motor vehicle dealerships.

61. In this respect, therefore, it is my judgment that the accused properly applied for the public funds in question, received those funds, and knowingly and dishonestly put those funds into a pool of funds created at his instigation with Ela Motors, and proceeded to dip his fingers into this “basket” or “pool of funds” as and when he desired, taking out whatever amount took his fancy, to use however he wished, contrary to the stated and specific intentions or purposes of the disbursements.

62. Now, dealing specifically, and in turn, with each of the eight counts of the indictment, it is the judgment of this court that the allegation under Count 1 has been proven beyond reasonable doubt. This count is in respect of the sum of K20,800, the amount that paid Toba Motors for the Musso S/W 4 x 4, registration no.: BAQ 553. The vehicle was registered to the accused’s name, having been purchased in June of 1999 (Exhibits “K”, “L”, “M”, “N”, “O” and “P”). Some eight months later, on 22 February 2000, the accused sold this vehicle to Ela Motors for K18,000 (Exhibit “Q”); but Ela Motors paid the accused (by cheque in his name) only a sum of K14,645 (Exhibit “R”). I find that the accused should not have purchased and disposed off this vehicle in the way he did.

63. Count 2: Alleges the misappropriation of the sum of K29,881 This was cash paid to the accused by Ela Motors by its Bank of Hawaii cheque No. 0000407 dated 29 July 1999. The following documents tendered by consent give evidence and credence to this allegation: Exhibit “A” (Ela Motors – Hon. Kuk Kuli’s Account Reconciliation); Exhibit “V” (Ela Motors Marketing memo, 28 July 1999); Exhibit “W” (Letter – Customer Consent deposit refund/transfer); Exhibit “X” (Ela Motors Pre Transfer/Refund Approval Fund); Exhibit “Y” (Bank of Hawaii cheque no. 0000407 for K29,881 dated 29 July 1999 in favour of the accused); Exhibit “Z” (Ela Motors Remittance Advice dated 29 July 1999); Exhibit “i” (Ela Motors cheque Register); and Exhibit “j” (Ela Motors Pom Branch Imprest Account Reimbursement Claim). The accused was not entitled to this money which was from the proceeds of the three (3) cheques he had received from the NGCB to buy ambulances for his electorate. There is no proper accounting of this money. Thus I find the accused misappropriated this money as alleged by the State.

64. Count 3: The allegation here is that during the relevant period the accused dishonestly applied to his own use monies in the sum of K3,505, the property of the NGCB and the State. In the evidence of the State, this sum of money features in the documents tendered by consent: Exhibit “d” (Bank of Hawaii cheque No. 0000409 dated 29 July 1999); Exhibit “e” (Ela Motors Remittance Advice dated 29 July 1999); Exhibit “f” (Workers Mutual Insurance Receipt No. 5877); Exhibit “g” (Motor Vehicle Policy Quotation No. WMI/5049/1999); Exhibit “h” (Third Party WMI Auto Care plus Interest); and Exhibit “A” (Hon. Kuk Kuli’s Account Reconciliation with Ela Motors). This was a payment to Workers Mutual Insurance by Ela Motors on behalf of the accused in respect of the motor vehicle Toyota 10-seater L/C Trooper registration no. BBA 880.

65. Once again documentary evidence tendered by consent on behalf of the State give credence to the allegation. As well as the above exhibits, other exhibits demonstrate that this motor vehicle had the original registration transferred to the accused himself, insured as such, and for the purpose of “Business” in the National Capital District (NCD) on 4 August 1999; two (2) years later on 6 November 2001 the motor vehicle was disposed off to District Services (Exhibits “I”, “j”, “k”, “l”, “m”, “n” and “o”). I have no difficulty in finding that the State has proven this allegation to the required degree and standard.

66. Count 4: This count alleges the misappropriation of the sum of K15,112.68 – the accused dishonestly applying this sum to the use of another person, Pastor John Oie. The money was used in relation to the purchase of a Toyota 15-seater bus (white in colour), registration no. BBB 235. Yet again, documentary evidence tendered by the State by consent of the Defence clearly demonstrate the history of the purchase and use of this motor vehicle. This vehicle went to John Oie of Mt Hagen after it had been registered for private use on 8 September 1999 (Exhibit “z” – certificate of CTP Insurance: see also Exhibit “Doc 92”, statement of William Penias of the Boroko Motor Traffic Registry). On 18 October 1999 the vehicle was converted into and used as a PMV following application for PMV licence by John Oie (Exhibits “Aa” – WHPG office of Traffic Registration, MV examination report; also Exhibit “Doc 89” – statement of Francis Elipa of the Motor Traffic Registry, Mt Hagen). Other exhibits confirm the status of the registration and insurance on the vehicle (Exhibits “Aa”, “Bb”, “Cc”, “Dd”, “Ee”, “Ff” and “Gg”). I find that the use of this money in the manner and purpose(s) described here constituted misappropriation as defined and alleged.

67. Count 5: This count is the allegation that during the relevant period the accused applied to his own use the sum of K2,022.42 the property of the NGCB and the State. This sum which features in the Ela Motors Hon Kuk Kuli’s Account Reconciliation (Exhibit “A”), was cash refunded to the accused by cheque No. 46895 dated 21 December 1999, and is further confirmed by Exhibits “ee” and “ff” (Ela Motors Remittance Advice and Payment Receipt respectively, both dated 21 December 1999). Once again, I have no difficulty in finding that the accused misappropriated this money (from the proceeds of the three (3) NGCB cheques) as charged.

68. Count 6: This count concerns the sum of K17,600 and the motor vehicle a Mitsubishi utility, registration number BAS 259. Exhibit “A” (supra) makes reference to this sum of money, and Exhibit “Doc 92” (the statement of William Penias, supra) outlines the registration history of this vehicle, beginning with the accused as the registered owner as at 21 December 1999, renewal in accused’s name on 2 June 2000. Three (3) years later, on 15 March 2002 the motor vehicle was registered in Mount Hagen in the name of Rural Community Services. The insurance documentation (Exhibits “Ww” and “Xx”) reveal the insurance of the vehicle for “Private” use in the name of the accused. I have no doubt at all that the sum of K17,600 was put to the use of the accused contrary to the purpose for which the funds were disbursed to the accused. Thus, I find the accused misappropriated these public funds.

69. Count 7: Withdrawn by the State.

70. Count 8: Similar allegation is made in respect of the sum of K1,109. And similar proof of the disbursement of this money comes from the various documents the State had tendered into evidence by consent. On 16 December 1999 Ela Motors paid Consort (shipping) this amount by cheque No. 46789 (Exhibit “A” – Hon. Kuk Kuli’s Account Reconciliation). This amount also features in the following documents: Ela Motors General Ledger Inquiry dated 23 August 2000 (Exhibit “Uu”); Ela Motors Payment Receipt dated 16 December 1999 (Exhibit “Vv”); Application for Registration of motor vehicle dated 21 December 1999 (Exhibit “Ww”); Certificate of CTP Insurance dated 21 December 1999 (Exhibit “Xx”); and Certificate of Transfer of Registration dated 21 December 1999 (Exhibit “Yy”). It is noted that these documents are in the name of the accused. And the certificate of Third Party insurance (Exhibit “Xx”) bears the accused’s name as “owner” and “Private” as the purpose of the use of the motor vehicle. The motor vehicle in question is a Mitsubishi Utility (green in colour), and registration No. BAS 259.

71. Registration on this vehicle was renewed on 2 June 2000 in the accused’s name, and on 14 March 2002, some two and half (2¹/₂) years later, the vehicle is registered in the name of “Rural Community Services” of Mt Hagen (Exhibit “Zz”). By design or inadvertence it is stated on the application form that the vehicle is to be used in the NCD (as the province) (ibid).

72. I find that the initial purchasing of the vehicle and used privately by the accused, in the NCD for some 2¹/₂ years, and its subsequent disposal to the so-called Rural Community Services in Mt Hagen constituted misappropriation as defined. And I find also that the payment of the sum of K1,109.60 to Consort for shipment of the motor vehicle, therefore, constituted misappropriation as alleged.

73. Count 9: The allegation here similarly involves the dishonest application of the sum of K1,658.90. This amount also features in the accused’s Account Reconciliation (Exhibit “A”), and is the freight cost paid to Consort (by cheque No. 46787) on 16 December 1999 for the shipment of a motor vehicle described as a Mazda Dyna (?) (SWB) B/L: 8123922. There being no explanation as to why this motor vehicle was purchased, and where or to whom it went, it is my respectful opinion that it is safe to conclude that the vehicle was not used as an ambulance by any of the health centres in the electorate. And this then sufficiently demonstrates misapplication of public funds in the way State alleges.

I, therefore, find this count proved beyond reasonable doubt.

74. Count 10: The State applied for leave to withdraw this count as it had no evidence to call in respect of it. Leave was granted.

Verdict

75. On the allegations contained in Counts 1, 2, 3, 4, 5, 6, 8 and 9 of the indictment, I find the accused guilty as charged and convict him in respect of each of these charges.

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The Public Prosecutor: Lawyer for the State
Young & Williams Lawyers: Lawyer for the Defence