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Golu v National Executive Council [2011] PGNC 134; N4425 (21 October 2011)

N4425


PAPUA NEW GUINEA
IN THE NATIONAL COURT OF JUSTICE


OS NO. 770 OF 2011


IN THE MATTER OF AN APPLICATION FOR JUDICIAL REVIEW
PURSUANT TO ORDER 16 OF THE NATIONAL COURT RULES


BETWEEN


ALOIS KINGSLY GOLU
Plaintiff


AND


THE NATIONAL EXECUTIVE COUNCIL
First Defendant


AND


SAM KOIM
Second Defendant


AND


TIMOTHY GITUA
Third Defendant


AND


SYLVESTER KALAUT
Fourth Defendant


AND


THOMAS KULUNGA in his capacity as the Acting Police Commissioner
Fifth Defendant


AND


THE INDEPENDENT STATE OF PAPUA NEW GUINEA
Sixth Defendant


Waigani: Gavara – Nanu J
2011: 18th & 21st October


JUDICIAL REVIEW – Application for leave – Application for leave to apply for judicial review of a decision made by the National Executive Council to appoint an Investigation Team to investigate into how 2009 to 2011 Development Budgets were appropriated – Such decision being made following allegations of corruption within Government Departments including the Department of National Planning & Monitoring and Government Agencies.


JUDICIAL REVIEW – Powers of the National Executive Council regarding control and management of public funds – Constitution ss. 142 (2), 146 (2), 148 (1) and149 – Public Finances (Management Act), 1995, s.3.


JUDICIAL REVIEW – Application for leave to apply for judicial review – Purpose of application for leave – Grounds for the application and the relief sought as pleaded in the Statement in Support – Whether the grounds and the relief sought relate to the decision, the subject of application.


Cases cited:
Papua New Guinea Cases


Burns Philip (PNG) Ltd v. The Independent State of Papua New Guinea (1989) N769
Isaac Lupari v. Sir Michael Somare (2008) N3476
Peter Ipatas v. Sir Mekere Morauta (2001) N2048
Robmos Limited v. Frederick M. Punangi N337
S.C.R No.i of 1982; Re Bouraga [1982] PNGLR 178
Southern Highlands Provincial Government v. The State & Ors [1993] PNGLR 401
The State v. Philip Kapal N417


Overseas cases:


Inland Revenue Commissioners v. National Federation of Self-Employed and Small Business Ltd [1981] UKHL 2; [1982] AC 617 at 644


Counsel:


W. Donald, for the plaintiff/applicant
M.Murray & S. Pannaphen, for the defendants/ respondents


21 October, 2011


  1. GAVARA-NANU J: This is an application by the plaintiff seeking leave to apply for judicial review of a decision made by the first defendant (NEC) on 12 August, 2011. The application is made pursuant to Order 16 r 3 of the National Court Rules (NCR) and the Originating Summons (OS) filed on 3 October, 2011.
  2. The decision of the first defendant involved appointment of an investigation team with broad Terms of Reference to investigate into allegations of corruption within the Department of National Planning and Monitoring and other Government Departments and Agencies. The first defendant also in its decision tasked the investigation team to investigate into how 2009 to 2011 Development Budget was appropriated, coupled with this was to investigate into the appropriation of K125 million for Kokopo Community Projects and K10 million which were outside of the Development Budget.
  3. The Minutes of the decision is reproduced hereunder for ease of reference:

PAPUA NEW GUINEA
____________


NATIONAL EXECUTIVE COUNCIL


Decision No: NG 03/2011 Special Meeting No: NG 02/2011


Subject: INVESTIGATION INTO THE ALLEGATIONS OF CORRUPTION AT THE NATIONAL PLANNING DEPARTMENT


On 11th August 2011, Council;


  1. Noted the content of Policy Submission No. NG 04/2011,
  2. Approved the establishment of the Investigation into allegations of corruption at the Department of National Planning & Monitoring which would also extend to other Departments or Sate agencies insofar as the Development Budget from 2009 to 2011 was appropriated, and among others the K125 million for the Kokopo Community Projects and the K10 million which are outside of the Development Budget;
  3. Appointed the named respective State agencies as listed in the submission which is attached as annexure "A", to furnish an officer(s) as identified by the Minister for National Planning and the Attorney General;
  4. Directed the Department of Treasury through the Minister for Treasury & Finance to allocate the sum of K6 million to be immediately made available for the investigation to commence;
  5. Approved the draft Terms of Reference as stated in the submission for the Investigation, attached as (Annex "B") amended (sic.);
  6. Approved the Team Members to be paid special contract allowances during the term of their engagement;
  7. Directed Department of Personnel Management through the Minister for Public Service to immediately organize short term special contracts of (sic.)Team Members for immediate execution;
  8. Directed the Department of National Planning through the Minister for National Planning, in consultation with the Department of Personnel Management to immediately suspend public servants who are implicated in the Investigation; and
  9. Directed the Attorney General and Minister for Justice through the Ministerial Committee on Law and Justice Sector to consult with the Chief Justice to appoint a Special Judge to hear the above cases as a matter of priority.

( Signed)___________


PETER O'NEILL Chairman

__________(Signed)_________

MANLY UA Secretary, NEC

Date: 12th August 2011-10-19


Distribution: PRIME MINISTER /DEPUTY PRIME MINISTER /ATTORNEY GENERAL & MINISTER FOR JUSTICE / MINISTER FOR NATIONAL PLANNING & MONITORING / NATIONAL PLANNING/ PERSONNEL MANAGEMENT / PMNEC / TREASURY/FINANCE.


  1. The instrument of appointment for the members of the investigation team is also reproduced hereunder for ease of reference:

INVESTIGATION TEAM


The Investigation Team comprise of the following persons/authorities:


  1. Chairman – Mr. Sam Koim, a Principal Legal Officer – Office of the Solicitor General, Department of Justice;
  2. Deputy Chairman – Superintendent Sylvester Kalaut, PPC of East New Britai;
  3. Chief Inspector Timothy Gitua, Director of Frauds and Anticorruption Squad and six Investigators – 1 x Forensic Expert, 1 x Police Prosecutor, 2 x Financial Intelligence Unit Officers and 6 Mobile Squards;
  4. A lawyer with the POCA Division at the Office of the Public Prosecutor;
  5. An Officer with the Department of Treasury;
  6. An Accountant from the Office of the Auditor General;
  7. An Officer from Tax Compliance Division of the Internal Revenue Commission;
  8. An Officer of the Department of Provincial and Local-Level Government Affairs;
  9. A Media Officer.
  10. The Terms of Reference for the investigation team is also reproduced hereunder:

TERMS OF REFERENCE


The following are the Terms of Reference (TOR) for the Team:


  1. Inquire into and ascertain:
    1. That Public Funds (Development Budget Component) administered by the Department of National Planning & Monitoring of the 2009, 2010 & 2011 Budgets were appropriated in compliance with their respective Appropriation Acts:
    2. That those who applied for and received the funds were in accordance with the Appropriation Acts;
    3. That the project submissions were consistent with the Appropriation Act and passed the screening criteria used by the Department of National Planning and Monitoring without undue influence;
    4. That the proponents of the project did not place themselves in a conflict of interest position;
    5. If those funds were diverted, who orchestrated the diversion and who benefited from such diversion;
    6. If the funds were paid outside of the Appropriation Act, who applied for and benefited from the funds;
    7. Whether the funds were sufficiently used for the purpose to which it was applied and granted;
    8. Whether certain laws including the Public Finance (Management) Act and the Criminal Code Act, etc, were breached;
    9. Who orchestrated the breach of those laws;
    10. Whether the person(s) implicated were public servants and if so, whether their conduct also amounted to conflict of interests.
  2. Prosecute the persons criminally implicated during the inquiry under the laws of Papua New Guinea including but not limited to the Criminal Code Act and Proceeds of Crime Act 2005;
  3. Take all steps the Proceeds of Crimes Act 2005 and the Mutual Assistance in Criminal Matters Act 2005 to recoup all proceeds of all funds found to have been diverted and misappropriated, such proceeds as are defined by Section 10 Proceeds of Crime Act;
  4. Refer the person(s) to the Ombudsman Commission if he /she is a leader covered by the Leadership Code;
  5. Recommend for immediate termination of employment if he or she is a public servant who is implicated in the investigations;
  6. Furnish to the NEC within 3 months from the date of commencement, a report on the investigations, conducted, persons implicated, prosecutions done, funds recouped, referrals made to the Ombudsman Commission and further actions to be taken if need be;
  7. Recommend to the NEC through the Minister for National Planning and Attorney General, possible legislative changes to patch up loopholes discovered during the investigations; and
  8. The Investigation Team shall complete its work within 3 months from the date of commencement, and shall seek extension thereafter if need be.
  9. The four broad principles which the plaintiff must establish to obtain leave to apply for judicial review are well established in this jurisdiction. First the plaintiff must show that he has sufficient interest in the decision vis., he must show that he is grieved by the decision and that the decision affects his rights and interests. This principle is embodied in Order 16 r 3 (5) of the NCR. Secondly, the plaintiff must establish that there has not been an undue delay in making his application. This principle is embodied in Order 16 r 4 of the NCR. Thirdly, the plaintiff must establish that all administrative avenues through which the plaintiff could have sought redress have been exhausted before coming to court to seek review of the decision. This is a common law principle which is designed to ensure that judicial review process is used as the last resort. This principle has dual purpose, first to encourage the applicants to resolve their grievances through administrative processes, which is also less costly and second to prevent applicants running to court to seek review without exhausting the available administrative avenues and unnecessarily resorting to processes of the court thus wasting court's time. This principle also provides the firm basis for the Court to refuse leave if leave is sought without the administrative avenues being fully exhausted: Southern Highlands Provincial Government v. The State & Ors [1993] PNGLR 401. Fourth principle is that the applicant must show that there is an arguable case justifying grant of leave for judicial review. Under this principle, the applicant must show that there is or are serious issue(s) arising from the decision which warrants judicial review. This principle establishes a fundamental test for grant of leave which must relate to and arise from the decision. In regard to how arguable case or serious issue(s) test should be determined at leave stage, the relevant principle to be applied was stated by Lord Diplock in Inland Revenue Commissioners v. National Federation of Self-Employed and Small Business Ltd [1981] UKHL 2; [1982] AC 617 at 644 where his Lordship said:

"If on a quick perusal of the material then available, the court...thinks that it discloses what might on further consideration turn out to be an arguable case in favour of granting to the applicant the relief claimed, it ought, in the exercise of a judicial discretion, to give him leave to apply for judicial relief. The discretion that the court is exercising at this stage is not the same as that which it is called upon to exercise when all the evidence is in and the matter has been fully argued at the hearing of the application".


  1. In this application no issues were raised by the defendants in regard to the first three principles. The defendants only took issue in regard to the fourth principle of an arguable case. The defendants argued that there is no arguable case warranting the grant of leave.
  2. Thus the only issue for me to decide here is whether there is an arguable case or serious issue(s) to be tried for which leave to apply for judicial review should be granted.
  3. The plaintiff raises five grounds for this application in his Statement in Support of this application. These grounds are as follows:

GROUNDS RELIED UPON


The grounds relied upon by the plaintiff in seeking the Relief claimed are as follows:-


  1. The First Defendant acted beyond its powers and or exercised powers not allowed under relevant Constitutional laws and Acts of Parliament to make the decision complained of in that:-
  2. The decision constitutes a serious breach of the Rules of Natural Justice under Common Law and pursuant to section 59 of the PNG Constitution:-
  3. There was real and apprehended bias in that:-
  4. No tribunal or authority doing justice could have made the decisions made by the First Defendant.
  5. There has been great miscarriage of justice as a result of the decision by the First Defendant.
  6. The plaintiff then states the facts in support of the application. It should be noted that these facts are adopted from the plaintiff's supporting affidavit.
  7. Decisions by the first defendant, the National Executive Council (NEC) are not immune from judicial review: Isaac Lupari v. Sir Michael Somare (2008) N3476, Robmos Limited v. Frederick M. Punangi N3372 and Peter Ipatas v. Sir Mekere Morauta (2001) N2048. If NEC acts outside the powers given to it either by the Constitution or a statute then Court orders may lie against it: Burns Philp (PNG) Ltd v. The Independence State of Papua New Guinea (1989) N769. Judicial review would therefore lie against NEC where it has exceeded its powers (acting ultra vires), abused its powers, or made a decision which no reasonable authority could have made: The State v. Philip Kapal [1987] PNGLR 417. However, in my opinion the Court should be loath to review decisions of the NEC because it is not just an ordinary decision making body. It is a body made up of Ministers with the Prime Minister as its Chairman and is established by the Constitution under s. 149. It is at the apex of the executive arm of the Government (s.141 (2), thus making it a special decision making body. It has wide and inherent powers to make and formulate public policies. The Ministers who make up the NEC are appointed by the Prime Minister, and each Minister is responsible to the NEC for the functions of his portfolio and NEC is in turn responsible to the people: S.C.R. No.1 of 1982; Re Bouraga [1982] PNGLR 178. Such being the special and unique character of the NEC, unless the NEC clearly acts contrary to the provisions of the Constitution or the Organic Law, or a statute, it would in my opinion be improper for this Court to imply that it must go about its deliberations in a particular way which would always be subject to the scrutiny and supervision of this Court: Burns Philip (PNG) Ltd v. The Independence State of Papua New Guinea (supra). Thus when it comes to applications for leave to apply for the review of NEC decisions, this Court should be loath in granting leave, subject of course to the proper exercise of Court's judicial discretion.
  8. The NEC is established by s. 149 of the Constitution. In the performance of its functions the NEC is required to be responsible (s.149(3)(a). It is the responsibility of the Prime Minister to appoint Ministers and determine their titles, port folios and responsibilities from time to time: ss. 144 (2) and 149 (1). In that regard, the Prime Minister has the overall responsibility over all the Ministers in the performance of their Ministerial responsibilities.
  9. In regard to the control and management of public funds or finances, s. 3 of the Public Finances (Management) Act, 1995, states the responsibilities of the Minister responsible for the management and control of public finances, including national budgets. Sub-Section (1) is pertinent:

3. Responsibilities of the Minister.


(1) The Minister is responsible for-
  1. The responsibilities of the Minister as stipulated by s.3 of the Public Finances (Management) Act, 1995, are determined by the Prime Minister pursuant to s. 148 (1) of the Constitution. The Prime Minister therefore has the overall responsibility and authority through the NEC to oversee these responsibilities and their implementations. The overall scheme of Public Finances (Management) Act, is aimed at ensuring that public funds, including national budgets are properly and legally expended and appropriated.
  2. Having regard to the principles applied in the line of cases cited, the question now is did the NEC in its decision, act beyond its powers? Or abuse its powers? Or deny the plaintiff his right to be heard? Or act contrary to any laws including the Constitution? Or was the decision of a type which no reasonable authority could have made? An affirmative answer to any of these questions would warrant the grant of leave to the plaintiff: Burns Philp (PNG) Ltd v. The Independent State of Papua New Guinea (supra) and The State v. Phillip Kapal (supra).
  3. These questions can in my opinion be better answered by addressing each of the grounds for this application.
  4. In Ground 1 the principal claim or allegation is that the first defendant (NEC) acted beyond its powers or acted contrary to constitutional laws and Acts of Parliament. This claim is particularised in paragraphs (a) to (f).
  5. Looking closely at the claims made in these paragraphs, I find that all these grounds are misconceived and misguided. All the claims in these paragraphs relate to the appointment of the special investigation team to investigate into alleged corruption in the Government Departments and Agencies and the appropriation of the Development Budget for 2009 to 2011. I see nothing wrong in such decision. The decision by the NEC to appoint the investigation team was in my opinion made within its powers. The claim that the appointment of the investigation team amounted to direction and control of the Police Force and the Public Prosecutor and a member of the court or judge has no basis. When one looks at the instrument of appointment for the members of the investigation team, there is nothing to support this claim. There is no evidence before the Court that the NEC acted beyond its powers or breached either constitutional laws or statutory laws when appointing the investigation team and setting its Terms of Reference.
  6. In Ground 2, it is alleged that the decision of the NEC was in breach of the principles of natural justice. Paragraphs (a) to (e) provide particulars of the claim. This ground relates to the approval by NEC for the investigation team to investigate into the use and allocation of K125 million for Kokopo Community Projects and K10 million which were outside of 2009 to 2011 Development Budget. The particulars pleaded in paragraphs (a) to (e) do not relate to or raise or even show breach of natural justice by the NEC at all. There is no substance in these claims.
  7. In Ground 3, the plaintiff claims that there was real and apprehended bias in the decision by the NEC tasking the investigation team to investigate the appropriation of K125 million for Kokopo Community Projects. In paragraphs (a) to (e) the plaintiff pleads particulars of what the plaintiff claims are apprehended or real bias by the NEC. I find that in all these paragraphs nothing has been pleaded which can raise or establish real or apprehended bias. The matters raised in all these paragraphs are matters for the investigation team to inquire into later and establish in the course of its investigations. These are matters which are raised in abstraction and having no real basis at all.
  8. Grounds 4 and 5 are consequential in that they can only arise if Grounds 1 to 3 or any of these Grounds is made out. Given the findings I made regarding Grounds 1 to 3, the plaintiff has failed to substantiate Grounds 4 and 5.
  9. As I said the NEC had the power to appoint the special investigation team with the Terms of Reference. Such an appointment is also in harmony with the powers and responsibilities of the Prime Minister as the Chairman of the NEC regarding management and control of public funds.
  10. In the result I find that there is no arguable case or serious issues to be tried.
  11. Application for leave is therefore refused with costs.
  12. Orders accordingly.

______________________________________________
Donald & Company Lawyers: Lawyers for the Plaintiff
Murray & Associates Lawyers: Lawyers for the Respondents

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