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PNG Ports Corporation Ltd v Kennedy [2017] PGNC 337; N7040 (30 March 2017)

N7040


PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]


OS No.880 of 2016


BETWEEN:


PNG PORTS CORPORATION LIMITED
First Plaintiff


AND:
HANE KILA – CHIEF MARITIME COMPLIANCE OFFICER & PORT MANAGER OF PNG PORTS CORPORATION LIMITED
Second Plaintiff


AND:
JEFFERY KENNEDY
First Defendant


AND:
PORT KENNEDY LIMITED
Second Defendant


Waigani: David, J

2017: 14 & 28 February, 20 & 30 March


INJUNCTION – application for interim injunction – principles governing grant or refusal of relief – principles of statutory interpretation - application granted – Harbours Act, Chapter 240 – Ports (Management and Safety) Regulation 2010 – Port Development Guidelines and Procedures – Konebada Petroleum Park Authority Act 2008.


Cases Cited:
Papua New Guinea Cases


Chief Collector of Taxes v Bougainville Copper Ltd (2007) SC853
Inakambi Singorom v John Kalaut [1985] PNGLR 238
Robinson v National Airlines Commission [1983] PNGLR 476


Overseas Cases


Amalgamated Society of Engineers v Adelaide Steamships Co Ltd [1920] HCA 54; (1920) 28 CLR 129
Grey v Pearson [1857] EngR 335; (1857) 6 HLC 61
KP Welding Construction Pty Ltd v Herbert [1995] NTSC 1; (1995) 102 NTR 20
Peninsula Group Pty Ltd v Registrar-General of the Northern Territory [1996] NTSC 91; (1996) 136 FLR 8
Project Blue Sky Inc v Australian Broadcasting Authority [1909] ArgusLawRp 102; (1998) 194 CLR 355; 15 ALR 490


Treatise cited:


DC Pearce and RS Geddes, Statutory Interpretation in Australia, 7th Edition 2011, Lexis Nexis Butterworths, Australia


Counsel:


Harold Viyogo, for the Plaintiffs
Alexander MacDonald, for the Defendants


RULING


30th March, 2017


  1. DAVID, J: INTRODUCTION: This is a ruling on an application moved by the plaintiffs pursuant to a notice of motion filed on 20 December 2016 essentially seeking an order to injunct the defendants, their servants, agents and any other person associated or connected with the defendants from constructing, extending or altering land area titled Portion 3524 within the Port Moresby declared Port limits pending the substantive hearing and determination of the matter or further orders of the Court.
  2. In support of their motion, the plaintiffs rely on; the Affidavit of Hane Kila sworn on 19 December 2016 and filed on 20 December 2016; and an Undertaking as to Damages provided by Stanley Alphonse, Acting Managing Director of the first plaintiff executed under the common seal of the first plaintiff dated 19 December 2016 and filed on 20 December 2016.
  3. The defendants contest the application. They rely on the affidavits of; Jeffery Kennedy sworn and filed on 25 January 2017 and Donald Valu sworn and filed on 9 February 2017.
  4. I heard the application on 14 February 2017 and reserved to deliver my ruling. On 28 February 2017, I mentioned this matter before the parties in Court and requested them to make further submissions on the question of jurisdiction, more particularly on the question of which legislation applied in a situation where there was a conflict given both the Harbours Act, Chapter 240 (the Harbours Act) and the Konebada Petroleum Park Authority Act 2008 (the Petroleum Park Act were Acts of Parliament and stand on the same footing as the other. I heard further submissions on 20 March 2017.

PLAINTIFFS’ EVIDENCE


Hane Kila


  1. She is the second plaintiff and is the Chief Maritime Compliance Officer and Port Manager of the first plaintiff. She is responsible for the overall management of the PNG Harbours Management Services (the PNGHMS), a Division of the first plaintiff.
  2. The first plaintiff is a State-owned enterprise and principally conducts the business of providing essential port services for the shipping industry and manages and regulates all the declared sea ports in the country. It is the delegated regulatory body of all declared ports in Papua New Guinea and has regulatory powers and functions from the Harbours Act, Chapter 240 and Ports (Management and Safety) Regulation 2010 (the Ports Regulation). It was delegated the powers, functions and responsibilities of the Departmental Head of the Department of Transport provided for under Sections 12A(2), 15H, 15I, 15K, 24, 25 and 36 of the Act by Instrument of Delegation from the Secretary of the Department of Transport dated 12 April 2010 made pursuant to Section 15L of the Act (Annexure “A”).
  3. She was appointed as Port Manager by the first plaintiff as a delegated authority of the Secretary for the Department of Transport pursuant to Section 15K(2)(f) of the Act by an instrument of appointment dated 4 November 2015 (annexure “B”) and performs the ports regulatory functions on behalf of the Secretary for the Department of Transport. The appointment was made retrospective to the commencement of the Ports Regulation and to remain in force until revoked or amended or she was no longer the Chief Maritime Compliance Officer.
  4. The delegated regulatory powers and functions include regulating development activities such as wharf constructions, backfilling and reclamation activities taking place within the foreshores of declared ports.
  5. Port Moresby was declared by National Gazette No.G188 dated 18 July 2011 (part of annexure “C”) as one of the declared ports in the country regulated by the first plaintiff through the PNGHMS. The PNGHMS is a registered business name and operates as the regulatory compliance division of the first plaintiff. All intended development activities within the declared port of Port Moresby by law must seek the prior approval of the Port Manager.
  6. The first defendant purportedly is the registered proprietor of all that piece or parcel of land known as Portion 3524 described in State Lease Volume 72 Folio 13 (Portion 3524), which is to be used bona fide for a Business (Light Industrial) purpose and a surveyed map of the land is attached (annexure “D”). The term of the lease is 99 years commencing from 1 July 2016 to 1 July 2115. According to the State Lease, the land covers an area of 162.22 hectares. According to the surveyed map, the land covers 76.220 hectares.
  7. Recently, it has come to her attention that there has been ongoing development particularly in land reclamation at the land within the foreshore area of Port Moresby Port particularly in the general west direction from Curtain Brothers Motukea Dockyard. Copies of the development plans or schematic plans for which reclamation of the sea area is happening were produced by the defendants to the plaintiffs when the plaintiffs enquired about them and they are annexed as annexures “E1”, “E2” and “E3”.
  8. As the Port Manager, she has not received any port development licence application from the defendants as required by law. The reclamation works on the foreshore of the declared Port of Port Moresby are by law subject to the regulatory oversight of the plaintiffs.
  9. Prior to any port development within a port area, a project development proponent, in this case, the first defendant, must submit to the Port Manager; first, its intention of putting up the development; and second, once received, a follow up meeting with the project proponent will be held to advise it of regulatory requirements and process.
  10. The regulatory requirements are set out in the Port Development Guidelines and Procedures (the Port Development Guidelines) which are derived from the Ports Regulation (annexure “F”). According to the Port Development Guidelines, port developments are classified into four categories depending on the level of the development proposed and costs anticipated. Types 1 and 2 are minor and uncomplicated developments such as laying of pipelines whereas types 3 and 4 are moderate to more complex developments such as building a wharf infrastructure to receive shipping.
  11. The relevant requirements of types 3 and 4 developments are:
  12. The pictures and plans received from the defendants (annexures “E1”, “E2” and “E3”) demonstrate that the defendants intend to build a wharf infrastructure which falls under types 3 and 4 of the Port Development Guidelines
  13. The PNGHMS contacted the first defendant by telephone and enquired about the land reclamation of the sea at Portion 3524. Thereafter, on 29 October 2016, a meeting ensued between the First Defendant and one Mr Wilfred Jonda, Team Leader of Regulatory Compliance with the PNGHMS and at which appropriate application forms were given to the first defendant.
  14. On 11 November 2016, the defendants submitted two applications to the PNGHMS. One was an Application for Endorsement of Underwater Lease (annexure “H”) and the other was an Application for Port Development (annexure “G”). These applications at first glance were found to be incomplete on the basis that:

(b) a Waste Management Plan, Environment Permit and other approvals from other regulatory agencies such as physical planning approvals were not provided by the First Defendant to support the Application for Port Development.


  1. By a letter dated 18 November 2016 (annexure “I”), the PNGHMS directed the defendants to; provide further information more specifically those referred in paragraph 26 above within 7 days of service of the letter; and to immediately cease any further reclamation of the sea. Despite briefly stopping work, the defendants have continued with the wharf infrastructure development with the land reclamation despite the issuance of the stop work notice.
  2. From the last inspection on Monday, 28 November 2016 jointly conducted by the PNGHMS personnel Mr Wilfred Jonda and herself together with the first defendant in the presence of his employees, it was obvious that the land reclamation was continuing.
  3. On 12 December 2016, a final letter was given to the defendants advising that they had failed to; comply with a stop work notice; and to provide documentation and information required for assessing their application for a port development permit (annexure “J”).
  4. The surveyed map of Portion 3524 (annexure “D”) shows the land mass at 76.220 ha, but the development plans (annexures “E1”, “E2” and E3”) show that the defendants are currently reclaiming land beyond the perimeters of Portion 3524. This is illegal development within the declared port area of the Port Moresby Port.
  5. As Port Manager, managing activities including infrastructure development activities with the Port Moresby Port precincts, she is obligated by law to ensure that all developments within the port precincts are done according to standards that will ensure that the environment both on land and the reclaimed sea areas are protected against adverse effects of developments undertaken.
  6. The defendants have shown and continue to show defiance of regulatory laws by continuing the land reclamation without complying with regulatory requirement and illegally reclaiming land that is not theirs.
  7. Her verbal enquiries and investigations reveal that the NCDC Development Control and Physical Planning authorities have not granted any necessary approvals to the defendants for the concerned port area development.
  8. The defendants continue to reclaim land despite being alerted of all these legal requirements and discrepancies. Annexures “K” and “L” are photographs of the level of land illegally being reclaimed.

DEFENDANTS’ EVIDENCE


Jeffery Kennedy


  1. He is the first defendant and Managing Director of the Second Defendant which is 100% nationally owned and registered in July 2016 (annexure “C”).
  2. He learnt that the Konebada Petroleum Park Authority (the KPPA) which is located between Motukea and Porebada was established by the Petroleum Park Act. The Konebada Petroleum Park (the Petroleum Park) comprising 23,235.80 ha and situated to the North West of Port Moresby and just North of Daugo (Fisherman) Island was established and annexure “A1” is a copy of the map showing the boundaries.
  3. Mr Donald Valu, the Chief Executive Officer of the KPPA told him about the objective of the Petroleum Park and which was to establish large scale greenfield petroleum processing adding value to the petroleum resources of the country and otherwise, promote downstream processing and export industries which will contribute to national economic growth. Mr Valu explained that the KPPA was created to give fruition to a long standing commitment by the National Government to bring economic development to Central Province.
  4. Within the boundaries of the Petroleum Park, a sub-division was created, along part of the coast of Fairfax Harbour (annexure “A2”).
  5. The original idea was for the KPPA to build its own wharf, but this was frustrated due to insufficient funding. Mr Valu was therefore very enthusiastic about his proposal for a port and wharf with support facilities to be constructed.
  6. He chose a site within the Petroleum Park boundaries for two reasons; first, to take advantage of certain legislative incentives, for example, conditional exemption on petroleum products; and second, the KPPA was the sole agency and authority for approving land reclamation and the design and construction of the wharf.
  7. After finding the right site, he began lengthy negotiations with customary landowners and they settled on a price. The initial customary land at Portion 2740(c) was surveyed at 76.220 ha. The land was voluntarily surrendered and acquired by the State pursuant to Section 10 of the Land Act and converted into a State Lease, Portion 3524 (annexure B). A land swap with KPPA led to the resurvey of the boundaries and amended as per Cadastral Plan 49/3175 and the boundaries extended to cover an area of 162.22 ha. It is within this area that the reclamation and wharf construction will occur as per his undertaking given on 21 December 2016. He is also willing to allow Ms Kila or her delegate to inspect and ensure that the reclamation work is within the boundaries of Portion 3524.
  8. After registering the second defendant, he began mobilising heavy earthmoving machinery and large trucks began to reclaim the foreshore and engaging engineers including a Mr Tonubu Bunemuga to design the wharf. Mr Bunemuga has 28 years of experience with established companies including Oti Architects, Home Guard, Oil Search, Curtain Bros and from August 2009 to 2015 with the first plaintiff.
  9. On 13 December 2016, he lodged a Conditional Surrender of State Lease pursuant to Section 38 of the Land Registration Act and requested smaller individual State Leases be issued (annexure “D”).
  10. He arranged the purchase from Australia of a large number of machinery to conduct the reclamation works and in anticipation of the construction of a wharf. He has estimated the daily hire rate of such machinery and if the works were injuncted, he will claim damages based on such rate (less any mitigated hire) plus wages for operators and security. He estimates that loss incurred will be K83,214.00 per day (annexure “E”). He will also claim as damages delayed loss of rental from reclaimed areas which could otherwise be leased at K10.00 per square per months for up to 20,000 square metres amounting to K200,000.00 per month.
  11. At the end of November 2016, he met with Ms Kila and Wilfred Jonda on site and told them about what he was doing and the defendants’ ambitions for the project. Mr Jonda was enthusiastic at the idea which would provide competition to at least two large neighbouring ports owned by Curtain Bros & AES and giving substance to the concept and creation of the Port Authority. Ms Kila however expressed some concern about them not complying with the Ports Regulation (annexure “F”) and their guidelines. He explained to Ms Kila that he was working within the boundary of the Petroleum Park and was governed by KPPA requirements and had its support. He said however that he was willing to cooperate with the PNGHMS, listen to them and would keep her informed and looked forward to their suggestions, blessing and support. It was on that basis that he lodged the applications mentioned in Ms Kila’s affidavit for their records. He also said that he did not require their consent nor was he subject to their authority or to comply with the Ports Regulation. He said he was governed by the requirements of the KPPA and was instructed by that authority to only deal with them. Ms Kila in response said she would investigate what he told him. However, he did not hear from her on the issue after that.
  12. He is willing and wants to work together with Ms Kila and her office because he recognises their expertise and experience and he intends to construct a wharf to best practice. However, whilst he accepts their guidance, it does not mean that he recognises their control.
  13. Construction of the wharf will only commence after reclamation work is completed which is estimated to be in about 3 months. Thereafter, technical stages will commence starting with core drilling (for seabed samples) and a Geotechnical Report prepared for sheet piling. The results of those tests will determine what kind of wharf can be built. He is willing to share such information with Ms Kila and her team and to be guided by them regarding standards and procedures to ensure the wharf meets “best practice standard”. His intention is to create a port and wharf that meet “best practice” and of international standard. For that reason, he has engaged Mr Bunemega to design the wharf and engaged an international port specialist AMSTEC to prepare a Port Concept Proposal (annexure “G”).
  14. However, Ms Kila has served upon them two notices, one dated 18 November 2016 and the other dated 12 December 2016 for purported failure to comply with the Ports Regulation and for reclamation done beyond their boundary and to stop work and to carry out the project within the confines of the law without making any reference to his discussions with her of the alternative jurisdiction of the KPPA.
  15. He has, from the commencement of the project including when acquiring titles and performing reclamation and designing the wharf, has had the support and obtained approval of the KPPA pursuant to the Petroleum Park Act with regard to:
  16. The reclamation and wharf construction require reclaiming swamp marsh with mango trees. He has engaged two reputable scientists, Stephen Bedford Clark from the United Kingdom and John Douglas of Douglas Environmental Services who was formerly a Senior Environmental Officer for 10 years with the former Department of Conservation & Environment to prepare their Environmental Reports for submission to the Conservation & Environment Protection Authority (CEPA) (annexure “H”). Mr Clark did similar work for the neighbouring Curtain Bros port and Inter Oil/Puma Energy wharf. Since his engagement, Mr Douglas has conducted a site inspection and taken samples. He is preparing an Environmental Report for the CEPA. He said the reclaimed land is environmentally similar to that of Motukea and the Inter Oil/Puma Energy wharf which were given CEPA approval.
  17. His activities are within the confines of the law with approvals from the KPPA acting within and in accordance with the Petroleum Park Act and in accordance with best practice.

Donald Valu


  1. He is the Chief Executive Officer of the KPPA. The KPPA was established pursuant to Section 5 of the Konebada Petroleum Park Act.
  2. In the 1990s, upon the abandonment of the proposed gas pipeline project connecting Northern Australia, the National Government decided to establish downstream processing of liquid gas and petroleum products in the country. An area of the Central Province coast was chosen since it was geographically suitable and development in this area was intended to fulfil a long standing political commitment to bring economic development to Central Province.
  3. For logistical reasons, the Petroleum Park area was to be located along the west coast about 30 minutes outside central Port Moresby. The Petroleum Park area was to complement, but not include the neighbouring LNG Project area. Negotiations were held with relevant customary landowners and an area of 23,235 hectares was identified as suitable for the Petroleum Park area.
  4. The boundaries of the Petroleum Park area were surveyed, a schedule of the boundary coordinates prepared and a map chartered in accordance with those coordinates. The map was marked or titled “Petroleum Zone”.
  5. On 25 April 2016, he wrote a letter to the then Acting Secretary for Department of Lands & Physical Planning, Luther Sipison and requested him to arrange for a Notice of Declaration of the boundaries to be signed and gazetted (annexure “A”) furnishing a schedule of the boundary coordinates and the Petroleum Zone map drawn in accordance with the boundary coordinates (annexure “D”).
  6. In mid-January 2017, after returning from an overseas trip to interview potential investors for the Petroleum Park area, the first defendant, Mr Kennedy requested for a copy of the Petroleum Zone map and he provided one.
  7. On 6 February 2017, the Hon. Minister Benny Allan MP signed the notice identifying and declaring the Petroleum Park area boundaries (annexure “B”) and gazetted on the same day (annexure “C”). According to the declaration, the Petroleum Park area contains an area of 23,325.80 hectares.
  8. He has read the affidavit of the first defendant and fully supports his efforts to bring development to the Petroleum Park area as intended by the Petroleum Park Act and in particular developing a port and constructing a wharf.

ISSUES


  1. The main issue that arises from this application and the contested facts is whether the injunction sought by the plaintiffs ought to be granted?
  2. The defendants have raised the issue of jurisdiction in their submissions. I do not propose to address the issue separately as I would normally do at the beginning of any hearing when the issue is raised, but I think it will suffice for me to do so when addressing the relevant principles applying to the grant or refusal of injunctions to the facts or circumstances of the present case.

RELEVANT PRINCIPLES


  1. The grant of an interlocutory relief is an equitable remedy and it is a discretionary matter. The purpose of an interlocutory injunction is to preserve the status quo until the determination of the substantive action. That position was succinctly put in Robinson v National Airlines Commission [1983] PNGLR 476 where at p. 480, Andrew, J held:

“The purpose of an interlocutory injunction is to preserve the status quo until the hearing of the main action “where other factors appear to be evenly balanced it is a counsel of prudence to take such measures as are calculated to preserve the status quo”, per Frost C.J. in Mt Hagen Airport Hotel Pty Ltd v Gibbs and Anor [1976] PNGLR. 316. No real principles can be laid down as to when they should or should not be granted except they are granted when “just or convenient” and what falls within that description must differ substantially from case to case. As Lord Denning M.R. said in Hubbard v Vosper [1972] 2 W.R.L. 389 at 396:

“In considering whether to grant an interlocutory injunction, the right course for a judge is to look at the whole case. He must have regard not only to the strength of claim but also to the strength of the defence and then decide what is best to be done. Sometimes it is best to grant an injunction so as to maintain the status quo until the trial. At other times it is best not to impose a restraint upon the defendant but leave him free to go ahead... The remedy by interlocutory injunction is so useful that it should be kept flexible and discretionary. It must not be made the subject of strict rules.”


  1. The relevant principles governing applications for the grant of interim injunctions in this jurisdiction are well settled and these were restated and reaffirmed by the Supreme Court in Chief Collector of Taxes v Bougainville Copper Ltd (2007) SC853. So in order for an injunction to be granted, it is incumbent upon an applicant to demonstrate that:

(a) there is a serious question to be determined (either of law or fact) in the substantive proceedings;

(b) the balance of convenience favours the grant or continuity of the injunction;

(c) damages is not an appropriate remedy if the injunction is not granted;

(d) an undertaking as to damages has been given by the applicant.


APPLICATION OF THE PRINCIPLES TO THE PRESENT CASE


Is there a serious question to be determined (either of law or fact) in the substantive proceedings?


Plaintiffs’ submissions


  1. The plaintiffs submit that the second plaintiff has the power to request for relevant documentation pertaining to port development from the defendants as port developers by virtue of the powers delegated to the first plaintiff by the Secretary for Department of Transport pursuant to the delegation of certain powers, functions and responsibilities specified in the instrument of delegation under Section 15L of the Harbours Act which was then delegated by the first plaintiff to the second plaintiff. Most of the powers, functions and responsibilities are those set out in the Ports Regulation more specifically those specified under Part 2 concerning Control of Port Development it was further submitted. In addition, it is submitted that since the defendants have failed to satisfy the requirements, it has prompted them to raise questions about the port development including the legality or otherwise of the port development in light of the issues of compliance with other statutory requirements under the Land Act, Environment Act, Harbours Act and the Physical Planning Act and the question of illegal land grabbing.
  2. The plaintiff further submits that:
  3. It was contended that the defendants may have made their earlier submissions relying on an outdated version of the Petroleum Park Act and may have misled the court as a result. It was submitted that the defendants relied on the earlier version of Section 6 that sets out the functions of the KPPA which has now been repealed and replaced by a new one. It was contended that the new Section 6 removed some of the functions that the defendants have strongly relied on particularly the former Section 6(a), (g) and (l) and that amounted to a misapprehension of the law. It was submitted that ignorance of the law is not an excuse more so when the first defendant and directors of the second defendant are learned lawyers makes the ignorance absolutely inexcusable and potentially render the venture illegal from the start.
  4. In addition, it was argued that another crucial factual matter that needs to be considered to ascertain the intention of the Parliament when it passed the Petroleum Park Act is the short time span between the date of certification of the original Petroleum Park Act which was done on 12 May 2009 and the passage of the Konebada Petroleum Park Authority (Amendment) Act 2009 that, inter alia, repealed and replaced Section 6 abolishing most functions of the KPPA which was certified on 3 June 2009. It was argued that the intention of the Parliament was and still is to restrict the extent of powers and functions of the KPPA to be exercised within the Petroleum Park area and its precinct relevant to the object of the Petroleum Park Act only by repealing and replacing the old Section 6 with a new one.
  5. It was argued that through the repeal, the powers of the KPPA to facilitate, coordinate or manage infrastructure development within the Petroleum Park area including marine facilities have been removed. Counsel stated that marine facilities meant facilities for; berthing, loading, unloading and servicing ships in the Petroleum Park and transporting and storing petroleum, processed petroleum, by products and other cargo and they essentially refer to ports and wharves. It was further submitted that the objects of the Petroleum Park Act set out under Section 2 and functions of the KPPA set out under Section 6 including involving in land dealings were all geared towards the establishment and operation of large scale greenfields petroleum processing and energy projects and to promote and develop downstream processing and export industries of petroleum products.
  6. The plaintiffs also contend that the Parliament never envisioned any intention for the development of wharf and port facilities within the Petroleum Park area and that has been demonstrated by the objects and functions set out in the Petroleum Park Act not providing for such activities or other activities relating to shipping. On the other hand, Section 50(2) allowed for consultation where activities of the KPPA potentially fall within the province of the Harbours Act. So in that sense the Petroleum Park Act was complimentary.
  7. It was contended that the defendants have entered into their wharf development on a legally flawed premise and an inexcusable mistake that potentially renders the whole wharf development project unlawful, void and illegal from the start because the Petroleum Park Act does not give them any legislative basis to carry out the development. It was submitted therefore that the Harbours Act and its subordinate legislation Ports Regulation apply to the defendants with regard to wharf development within the Petroleum Park area at Portion 3524.

Defendants’ submissions


  1. It was submitted that conflict arises because the Harbours Act and the Petroleum Park Act have the same parliamentary status and each party seeks to govern the same event or activity. However, it was also submitted that actual conflict is avoided because the courts follow the “precedent of chronology” and this meant that earlier statutes are overrriden by later statutes; first, by amendment; second, earlier Act is expressly repealed; third, where inconsistency is only discovered by chance, inconsistent provision(s) is or are implicitly repealed; and fourth, legislation is expressly excluded. In his written submissions, counsel referred the Court to a number of examples depicting these situations.
  2. Counsel submitted that a certain piece of legislation may apply exclusively to one geographical location by virtue of Section 80 of the Interpretation Act and by the same reasoning, legislation can be excluded from parts of the country.
  3. The defendants submit that the activities complained of by the plaintiffs are conducted at Portion 3524 and its foreshore which are within the Petroleum Park area which was established under Section 3(4) of the Petroleum Park Act and administered by the KPPA and the KPPA had exclusive authority to regulate and manage the park and to act as the regulator of infrastructure in the park including planning, building and utilities. It was contended that investors located within the Petroleum Park area are allowed to construct their infrastructure without reference to governmental bodies who derive their regulatory authority from the excluded legislation.
  4. In addition, it was submitted that Section 50(1)(b) of the Petroleum Park Act expressly excludes the legal basis upon which the plaintiffs rely to commence these proceedings and it is this statutory right vested in the KPPA which the defendants rely on to perform reclamation works and intended wharf construction within the boundaries of Portion 3524.
  5. Counsel submitted that there are two common law general approaches to the interpretation of legislation which were commented on by the learned authors, DC Pearce and RS Geddes, Statutory Interpretation in Australia, 7th Edition 2011, Lexis Nexis Butterworths, Australia and they are; first, the literal approach; and second, the purposive approach. He said the literal approach examines the language used in the statute as a whole in its ordinary and natural sense and applies that meaning. This has been modified where a literal approach produced an absurdity or ambiguity, including where the intention of the legislature is doubtful in which case a court is entitled to apply the purposive approach by considering from the context of the whole statute what mischief was intended to be remedied and what interpretation would provide the best remedy.
  6. Counsel submitted that in the present case, in applying the literal approach, there is no absurdity or ambiguity to be remedied and the purpose of Section 50(1) was to avoid “interference” from certain regulatory bodies.
  7. It was submitted that the Court is required by the clear language and obvious intend of Section 50(1)(b) to exclude the jurisdiction of the Harbours Act and consequently the involvement of the statute’s agents namely, the plaintiffs acting against the defendants’ activities in the designated Petroleum Park area. The Harbours Act and guidelines issued under the Ports Regulation for regulating activities at declared ports therefore did not apply to the defendants and or their activities at Portion 3524 it was submitted.

Reasons for ruling


  1. I have considered the submissions of counsel and the evidence before me.
  2. There is in evidence, which is not contested, an instrument of delegation dated 12 April 2010 signed by the Secretary for the Department of Transport, the Departmental Head of the Department responsible for transport matters under Section 15L of the Harbours Act, by which he delegates to the first plaintiff all the powers functions and responsibilities of the Departmental Head of the Department of Transport under sections 12A (2), 15H, 15I, 15K, 24, 25 and 36 of the Harbours Act. There is also in evidence, which is not contested, an instrument of appointment dated 4 November 2015 signed by Stanley Alphonse, Chief Executive Officer of the first plaintiff under Section 15K(2)(f) of the Harbours Act, by which he appoints the second plaintiff, Chief Maritime Compliance Officer as the Port Manager for all declared ports and harbours in the country.
  3. In evidence, there are these further uncontested facts:
  4. From the evidence before me, the principle contested fact is that Portion 3524 and reclamation activities conducted by the defendants on the foreshore of the land and their proposed port and wharf construction are within the Petroleum Park area administered by the KPPA under the Petroleum Park Act so they do not require the consent or approval of the plaintiffs to conduct their activities.
  5. The first plaintiff exercises the powers, functions and responsibilities delegated to it under sections 12A (2), 15H, 15I, 15K, 24, 25 and 36 of the Harbours Act by the Secretary for the Department of Transport, the Department Head of the Department responsible for transport matters under Section 15L of the Harbours Act on 12 April 2010. The second plaintiff was on 4 November 2015, by an instrument of appointment, appointed by the first plaintiff as the Port Manager of all declared ports and harbours in the country pursuant to Section 15K(2)(f) of the Harbours Act.
  6. Section 15H sets out the general functions of the Departmental Head which were delegated to the first plaintiff. Most (if not all) of these powers, functions and responsibilities are encapsulated in the Ports Regulation.
  7. Part 2 (Sections 3 to 9) of the Ports Regulation is relevant as it deals with the control of port development. I set out the relevant provisions below.

PART 2. — CONTROL OF PORT DEVELOPMENT.
Division 1. — General Controls.
3. Lease of land.


Where a Port Manager proposes to lease any land, water or under-water area comprising part of the area included in a Declared Port, the Port Manager must notify the Departmental Head of any such lease.


4. Construction of Ports and Port Facilities.

(1) Where a person proposes to construct, extend or alter a Port or Port Facility, and before any Port or Port Facility is constructed, extended or altered and before any contract connected with such Port or Port Facility construction, extension or alteration is entered into by or on behalf of that person, the person must obtain the prior written approval of the Port Manager

(2) To facilitate the Port Manager's consideration of any proposed construction, extension or alteration, the person referred to in Subsection (1) must provide the Port Manager with such plans, economic impact statements and other information as the Port Manager may require from time to time.

(3) Any person who fails to comply with the provisions of this section is guilty of an offence, the penalty for which is as prescribed under Section 83.


5. Excavation and reclamation within a Port.

(1) Unless the prior written approval of the Port Manager has been obtained, a person must not make an excavation or reclamation within a Port.

(2) Where an excavation or reclamation has been made within a Port, whether with or without the approval of the Port Manager, the Port Manager shall cause barricades to be erected or warning lights to be placed at appropriate parameters of the excavation or reclamation.

(3) The cost of erecting or installing barricades or lights may be recovered by the Port Manager as a debt from the person who made or authorised the making of the excavation or reclamation.

(4) Any person who fails to comply with the provisions of this section is guilty of an offence, the penalty for which is, as prescribed under Section 83.


6. Protection of Port air, land and water.

(1) Subject to the Regulations, a Port Manager may issue such written or other Environmental Directions as the Port Manager thinks necessary to —

(a) preserve the air, land, water or under sea area within a Port; and

(b) protect, maintain or improve the natural and man made environment within a Port; and

(c) prevent the entry into a Port, or the removal from a Port, of any person or thing which, in the reasonable opinion of the Port Manager, endangers, threatens or otherwise puts at risk the air, land, water or under sea area or natural or man made environment within a Port.

(2) An Environmental Direction issued under this Regulation may include any matter concerning the entry into the air or into or onto the land, water or under sea area within a Port, from outside a Port, of any substance or thing which would pollute the natural or man made environment of a Port.
(3) Environmental Directions may —

(a) provide for their application to all Ports or specified Ports managed by the Port Manager; and

(b) be amended from time to time.

(4) Environmental Directions and any amendments issued by a Port Manager under this regulation must be published in the National Gazette.

(5) Any person who fails to comply with an Environmental Direction is guilty of an offence, the penalty for which is as prescribed under Section 83.


Division 2. — Construction of Ports and Port Facilities.
7. Construction standards and specifications.

(1) All Ports and Port Facilities must be constructed and maintained by Port Facility Operators or owners of such ports and facilities (as the case may require) in accordance with any standards and specifications established by the Port Manager.

(2) For the purposes of this regulation the Port Manager may, by written order, establish standards and specifications for the construction and maintenance of Ports and Port Facilities.

(3) Where standards and specifications are established under Subsection (2)—

(a) the Port Manager must publish and make available the standards and specifications in a form which is available to the public; and

(b) for the purpose of this Regulation, such publication may be posted on the Internet.

(4) Without limiting Subsection (2), standards and specifications may refer to or incorporate, wholly or partially and subject to such modifications and conditions as are determined by the Port Manager, any standard, code, procedure, specification or other document prepared or laid down by an authority or agency within Papua New Guinea or elsewhere, and may apply to one or more Ports, as the Port Manager may determine.

(5) Any person who fails to comply with the provisions of this section is guilty of an offence, the penalty for which is as prescribed under Section 83.


8. Construction, maintenance and testing of pipelines.

(1) Subject to Regulation 7, all pipelines within a Port or connecting to a Port Facility must be constructed, maintained and tested by a Port Facility Operator or a pipeline owner (as the case may require) in accordance with the standards and specifications established by the Authority.

(2) For the purpose of this Regulation the Authority may establish standards and specifications for the construction, maintenance and testing of pipelines.

(3) Where standards and specifications are established under Subsection (2)—

(a) the Authority must publish and make available the standards and specifications in a form which is available to the public: and

(b) for the purpose of this Regulation, such publication may be posted on the Internet.

(4) For the purposes of this regulation, where an existing pipeline is to be re-laid or renewed or any major repairs are to be effected. including any repairs involving the use of electric or gas welding or cutting apparatus, the pipeline is classified as being constructed.

(5) Where the Authority is of the opinion that it is in the interests of public safety to do so, the Authority may, by written notice given to a Port Facility Operator or a pipeline owner (as the case may require), require the Port Facility Operator or pipeline owner to re-lay, renew, replace, repair or re-test the pipeline.

(6) Where a person proposes to construct, re-lay or alter a pipeline the person must submit plans and specifications for such construction, re-laying or alteration to the Port Manager for approval prior to such work proceeding.

(7) Any person who fails to comply with the provisions of this section is guilty of an offence, the penalty for which is as prescribed under Section 83.


9. Inspection and testing of pipelines.

(1) Pipelines within a Port or connecting to a Port Facility must be inspected and tested by the Authority annually.

(2) The Authority must appoint, in writing, suitably qualified inspectors to carry out inspections and testing of pipelines within a Port or connecting to a Port Facility.

(3) Inspectors appointed under this regulation must carry out inspections and testing of pipelines in accordance with these Regulations and any written or other directions from the Authority.

(4) The pipeline owner or Port Facility Operator (as the case may require) is responsible for the cost of any inspection or testing under this Regulation.


  1. The Port Manager has at his or her disposal these powers, functions and responsibilities to control any port development within the boundaries of all declared ports in the country.
  2. On the other hand, the defendants rely on the powers vested in the KPPA, the statutory body established by the Petroleum Park Act with regard to its overall administration and regulation of activities in the Petroleum Park area and the expressed exclusion of the application of the Harbours Act and others specified under Section 50 of the Petroleum Park Act. Section 50 states:

“50. Application of Acts of the National Parliament.


(1) All Acts apply to the Authority and to the Park with the exception of the following Acts (and subordinate instruments made under them), which do not apply to the Authority and the Park—

(a) Building Act (Chapter 301); and

(b) Harbours Act (Chapter 240); and

(c) Independent Consumer and Competition Commission Act 2002; and

(d) National Capital District Water Supply and Sewerage Act 1996; and

(e) National Water Supply and Sewerage Act 1986; and

(f) National Roads Authority Act 2003; and

(g) Physical Planning Act 1989; and

(h) Roads Maintenance Act (Chapter 246).

(2) In exercising its powers under this Act, the Authority may, and if required by the State or any person or instrumentality responsible for administering the legislation referred to in Subsection (1), the Authority must, consult with any such person or instrumentality responsible for administering the legislation referred to in Subsection (1) but nothing done by the Authority its invalid only because it did not consult with any such person or instrumentality.

(3) The State and any agency or instrumentality of the State shall not grant any right giving access to any land in the Park without the consent of the Authority.”


  1. It is quite apparent that there is a conflict as to which particular legislation applies in the present case and will go to raise issues on jurisdiction given; Fairfax Harbour is within the declared Port Moresby Port; the land mass of Portion 3524 extends out to and covers underwater areas which are within the Fairfax Harbour and within the Port Moresby Port; the defendants are conducting reclamation activities at Portion 3524 and on its foreshore; Portion 3524 is situated within the Petroleum Park area; and the reclamation is being done within the Petroleum Park. The Harbours Act was enacted way before the Petroleum Park Act, the latter coming into operation on 7 December 2011: National Gazette No.G109 dated 23 March 2012.
  2. I could, in the exercise of my discretion or jurisdiction, refer this point of law or issue to the Supreme Court to give its opinion or interpretation under Section 15 of the Supreme Court Act which allows a judge of the National Court to refer any point in a case for consideration of the Supreme Court: see also Section 18 of the Constitution which provides for a constitutional reference by the Court. This is because my interpretation in a certain way of the application of these two statutes may create or is likely to create uncertainty or perpetuate an uncertainty in the law. I have not been requested by the parties to consider that approach though.
  3. In my endeavour to address this issue, I make reference to the two common law general approaches to the interpretation of legislation that have been mentioned by Mr MacDonald in his submissions namely, the literal approach and the purposive approach. The two approaches are discussed by the learned authors, DC Pearce and RS Geddes, Statutory Interpretation in Australia, 7th Edition 2011, Lexis Nexis Butterworths, Australia at 27 to 30 which I have consulted.
  4. The literal approach was correctly put by Mr MacDonald in his submissions. This approach was defined and explained by Higgins J in Amalgamated Society of Engineers v Adelaide Steamships Co Ltd [1920] HCA 54; (1920) 28 CLR 129 as follows:

“The fundamental rule of interpretation, to which all others are subordinate, is that a statute is to be expounded according to the intent of the Parliament that made it; and that intention has to be found by an examination of the language used in the statute as a whole. The question is, what does the language mean; and when we find what the language means, in its ordinary and natural sense, it is our duty to obey that meaning, even if we think the result to be inconvenient or impolitic or improbable.”


  1. This definition did not allow for possible alternative approaches. Other cases have since advocated a departure from the restricted definition allowing for possible alternative approaches. One of those cases was Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 384; [1909] ArgusLawRp 102; 15 ALR 490 at 511 where McHugh, Gummow, Kirby and Hayne JJ said:

“.... The duty of a court is to give the words of a statutory provision the meaning that the legislature is taken to have intended them to have. Ordinarily, that meaning (the legal meaning) will correspond with the grammatical meaning of the provision. But not always. The context of the words, the consequences of a literal or grammatical construction, the purpose of the statute or the canons of construction may require the words of a legislative provision to be read in a way that does not correspond with the literal or grammatical meaning.”


  1. A limitation was placed on the literal approach in Grey v Pearson [1857] EngR 335; (1857) 6 HLC 61 at 106 where Lord Wensleydale observed:

“I have been long and deeply impressed with the wisdom of the rule, now, I believe, universally adopted, at least in the Courts of Law in Westminster Hall, that in construing wills and indeed statutes, and all written instruments, the grammatical and ordinary sense of the words is to be adhered to, unless that would lead to some absurdity, or some repugnance or inconsistency with the rest of the instrument, in which case the grammatical and ordinary sense of the words may be modified, so as to avoid that absurdity and inconsistency, but no farther.”


  1. The purposive approach is applied by determining the purpose of the statute or the particular provision in question and by adopting an interpretation of the words that was consistent with that purpose: DC Pearce and RS Geddes, Statutory Interpretation in Australia, 7th Edition 2011, Lexis Nexis Butterworths, Australia at 29. The purpose of a statute is deduced by looking at the statute as a whole and the history of the statute may be of assistance. It has been suggested that the purposive approach could be applied even when the meaning of the statute appeared clear on its face: KP Welding Construction Pty Ltd v Herbert [1995] NTSC 1; (1995) 102 NTR 20 at 40-41; Peninsula Group Pty Ltd v Registrar-General of the Northern Territory [1996] NTSC 91; (1996) 136 FLR 8 at 12. These cases are persuasive.
  2. The two common law approaches have been succeeded or subsumed by statute. Under Schedule 2.2 of the Constitution, the principles of common law and equity that applied in England immediately before Independence are adopted as part of the underlying law of Papua New Guinea except if, and to the extent that; they are inconsistent with a Constitutional Law or a statute; or they are inapplicable or inappropriate to the circumstances of the country from time to time; or in their application to any particular matter they are inconsistent with custom as adopted by Part 1, Schedule 2.1 of the Constitution.
  3. Sections 109(4), 158 (2) and Schedule 1.5 of the Constitution are guides to statutory interpretation of constitutional laws and other legislation. Rules or maxims of interpretation may be considered where appropriate as they are not substantive law and cannot override clear and explicit parliamentary intention in any legislation: Inakambi Singorom v John Kalaut [1985] PNGLR 238.
  4. Section 109(4) states:

“Each law made by the Parliament shall receive such fair, large and liberal construction and interpretation as will best ensure the attainment of the object of the law according to its true intent, meaning and spirit, and there is no presumption against extra-territoriality.”


  1. Section 158(2) states:

“In interpreting the law the courts shall give paramount consideration to the dispensation of justice.”


  1. Schedule 1.5 states:

“(1) Each Constitutional Law is intended to be read as a whole.

(2) All provisions of, and all words, expressions and propositions in, a Constitutional Law shall be given their fair and liberal meaning.”


  1. In short, these provisions demonstrate that the standard of interpretation imposed for interpreting constitutional laws should be adopted and used in interpreting statutes which are less superior to them as well. Kidu, CJ in Inakambi Singorom at 241-242 clearly expresses this point where he observed:

“Rules or maxims of interpretation of statutes are only guides and must not be thought of as substantive law. They are not inflexible rules to be applied without question. In this jurisdiction these rules are subject to two very important constitutional provisions: (a) fair and liberal interpretation (Sch 1.5 (2) ) and (b) the paramountcy of justice (s 158 (2). Schedule 1.5 (2), I know, relates to the interpretation of constitutional laws, but if constitutional laws, which are higher laws than Acts of Parliament, must be given their fair and liberal meaning, it is my view that that means that ordinary laws must be given their "fair and liberal meaning". Section 158 (2) says that in interpreting laws the courts must "give paramount consideration to the dispensation of justice".


Whatever the rules or maxims of statutory interpretation say, one thing must not be lost sight of and that is that a clear parliamentary intention in legislation cannot be ignored or overruled by the courts. The courts cannot and must not frustrate clear parliamentary intention in any legislation so long as such legislation is constitutionally valid. For Parliament is empowered by the Constitution, s 100, to exercise the legislative power of the people and not the courts. In fact Parliament's legislative power, subject to the Constitution, is unfettered (the Constitution, s 109 (1) ), and laws made by Parliament "shall receive such fair, large and liberal construction and interpretation as will best ensure that attainment of the object of the law according to its true intent, meaning and spirit" (s 109 (4) ). I have said the above to emphasise that a court cannot go beyond its powers by using maxims of interpretation or rules of interpretation to over-ride clear and explicit parliamentary intent in legislation. Tis is not saying that I support "the strict literal and grammatical construction of the words, heedless of the consequences" approach to statutory interpretation: see PLAR No 1 of 1980 [1980] PNGLR 326.


The "purposive" rule of interpretation urged by Wilson J and Andrew J in PLAR No 1 of 1980 must not be used by the courts to nullify laws which are clearly constitutional and which clearly and unambiguously state the intentions of the legislature. What I am saying can be stated simply this way: Where Parliament says in an Act that "dogs" are to be registered if they are pets, a court cannot say that "dogs" means "pigs" simply because pigs are sometimes raised as pets.”


  1. I would adopt the purposive approach to the interpretation of the statutes under consideration.
  2. I have considered Section 50(1) of the Petroleum Park Act. The language is clear and raises no absurdity. However, when I jointly read the preamble and more importantly the objects of the statute set out under Section 2 and functions of the KPPA set out under Section 6, it is clear in my mind that the exclusion under Section 50(1)(b) only applies to activities that the KPPA is lawfully allowed to conduct within the precinct of the Petroleum Park.
  3. The Petroleum Park Act establishes the KPPA and defines its powers and functions and for related purposes.
  4. According to Section 2, the objects of the Petroleum Park Act are to:

“(a) provide an appropriately managed and serviced industrial precinct for the establishment and operation of large scale greenfields petroleum processing and energy projects which add value to the petroleum resources of Papua New Guinea and elsewhere; and

(b) promote and develop downstream processing and export industries which will contribute to national economic growth and development; and
(c) enable land to be used for commercial activities;. and

(d) create employment opportunities in skilled and unskilled occupations and to foster, in partnership between the government and industry, the establishment of training facilities: and

(e) ensure that petroleum processing is achieved in accordance with best industrial, social and environmental practice; and

(f) enable the Authority to become financially self sufficient by operating on a full cost recovery basis.”


  1. According to Section 6 of the Petroleum Park Act, the functions of the KPPA are:

“Without limiting the generality of functions of the Authority under Section 6, prescribed by this Act or any other law, the functions of the Authority are to—

(a) as prescribed, determine the scope of activities permitted in the Park and eligibility to downstream processing of petroleum; and
(b) to acquire Government and private land in the Park; and

(c) hold and manage land for the use by the Authority and enterprises at the Park, and to collect rent for the use of land; and

(d) manage relations with customary landowners, including business development, social, health and environment programs; and

(e) to carry out such other functions as are given to the Authority by this Act or by any other law; and

(f) generally to do such supplementary, incidental, or consequential acts and things as are necessary or convenient for the Authority to carry out its function.”


  1. The powers of the KPPA are set out under Section 7 of the Petroleum Park Act and they are:

“The Authority has, in addition to the powers otherwise conferred on it by this Act and any other law, power to do all things necessary or convenient to be done for or in connection with the performance of its functions.”


  1. Consultation under Section 50(2) is noted.
  2. There is no challenge to the validity of the Ports Regulation and the Port Development Guidelines or the powers delegated to the defendants by virtue of the Harbours Act. The defendants’ main contention was that the Harbours Act and the subordinate instruments such as the Ports Regulation and the Port Development Guidelines did not apply to them due to the exclusivity provision of the Petroleum Park Act.
  3. I generally accept the plaintiffs’ submissions. The relevant provisions of the Ports Regulation and the Ports Development Guidelines need to be observed by a person who proposes to construct, extend or alter a port or port facility or make an excavation or reclamation within a port. According to Section 2 of the Ports Regulation, "port facility" means any fixed or floating building, structure, shed, vessel, terminal, facility, erection, pipeline or other improvement within a Port, and includes a wharf and any navigational aids within a Port and the channels and approaches leading to a Port. For the foregoing reasons, I state that I have jurisdiction. There is a serious question to be determined (either of law or fact) in the substantive proceedings. This consideration favours the plaintiffs.

Does the balance of convenience favour the grant or continuity of the injunction?


Plaintiffs’ submissions


  1. The plaintiffs submitted that the balance of convenience favours the grant of the injunction in order to stop any further development of Portion 3524.

Defendants’ submissions


  1. The defendants submitted that the harm which would arise to them if the injunction were granted far outweighs the plaintiff’s desire for an early assertion of their authority with the risk of a massive claim in damages against a government agency if their case is not ultimately successful. The injunction should be refused it was submitted.

Reasons for ruling


  1. I accept the plaintiffs’ submissions. I adopt the reasons I have given for determining the first consideration and apply them here. The balance of convenience favours the grant of the injunction to the plaintiffs.

Are damages not an appropriate remedy if the injunction is not granted?


Plaintiffs’ submissions


  1. The plaintiff’s submitted that damages would not be an adequate remedy. In addition, it was submitted that developments currently underway are doing irreparable damage to the natural environment whilst also affecting shipping activities both present and in the future.

Defendants’ submissions


  1. On the other hand, the defendants submitted that economic harm on a massive scale will be brought upon the defendants if the injunction were granted.

Reasons for ruling


  1. I generally accept the plaintiffs’ submissions. I also adopt the reasons I have given for determining the first consideration and apply them here. Damages would not be an appropriate remedy.

Have the plaintiffs given an undertaking as to damages?
Reasons for ruling


  1. This issue is not contested. Yes; an undertaking as to damages executed under seal was given by Stanley Alphonse, Acting Managing Director of the First Plaintiff on 19 December 2016. The undertaking suffices for both plaintiffs.

CONCLUSION AND ORDERS


  1. All the four requirements or considerations have been met by, or considered in favour of, the plaintiffs. For all the foregoing reasons, the plaintiffs have made out that this is a proper case for the granting of the discretionary relief. Accordingly, I grant the interim injunction as sought. In the exercise of my discretion, I also order that costs of this application be in the cause.

Ordered accordingly.


______________________________________________________________
In-house lawyers: Lawyers for the Plaintiffs
Jema Lawyers: Lawyers for the Defendants

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