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Omba v Musom [2025] PGNC 222; N11377 (16 July 2025)

N11377


PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]


OS (JR)NO. 302 OF 2020


BETWEEN:


TOBIAS OMBA
Applicant


AND:


MARTIN MUSOM, PAUL MUS & AKAS KAMBRING
first Respondents


AND:


FABIAN CHOW, ADMINISTRATOR of Estate of late HENRY FRANCIS CHOW
second Respondent


AND:
BENJAMIN SAMSON, SECRETARY-Department of Lands & Physical Planning
third Respondent


AND:
ALA ANE, REGISTRAR OF TITLES
fourth Respondent


AND:
HON. JOHN ROSSO, MINISTER FOR LANDS AND PHYSICAL PLANNING
Fifth Respondent


INDEPENDENT STATE OF PAPUA NEW GUINEA
sixth Respondent


Lae: Dowa J
2022: 13th September
2025: 16th July


JUDICIAL REVIEW –application for the nullification of Lands Minister’s decision to grant SABL -whether Minister and Lands Department failed to comply with the statutory requirements under the Land Act 1996 for the acquisition of customary land for the grant of SABL -Land Act, Sections 9,10, 11 and 102 – whether errors of law committed in decision-making process resulting in granting of State Lease – remedies


LAND – customary land – acquisition of customary land by the State for lease-leaseback purposes – Land Act, Sections 10 and 11 – whether agreement of all customary landowners necessary – grant of leases for special agricultural and business purposes – Land Act, Section 102-held errors of law proved-judicial review granted.


Cases cited:
Kekedo v Burns Philip (PNG) Ltd [1988-89] PNGLR 122
Leahy v Otri (2009) N3860
Musa Valley Management Company Limited v Pepi Kimas (2010) N3827,
Mahuru v Dekena (2013) N5305.
Mudge -v- Secretary for Lands [1985] PNGLR 387
Mota v Camilus (2017) N6810.
NCDC v Yama Security Services Pty Ltd [2003] PNGLR 16
Pius Tikili v Home Base Real Estate Ltd (2017) SC1563,
PNG Bible Church Inc v Carol Mandi (2018) SC1724
and Rosemary John v James Nomenda (2010) N3851,
Timothy v Timothy (2022) SC2282
Toki v Helai (2016) SC1558,
Theiss Watkins v PNGEC [1988-89] PNGLR 454,
Vaki Vailala v NHC (2017) N6598
Vaki v Baki (2012) N4809
Waranaka v Dusava (2009) SC940


Counsel:
T. Berem, for the applicant
P Mus in person, for the first Respondents
J Landgah, for the second Respondent
B Tomake,,for the third, fourth, fifth and sixth Respondents


DECISION


16th July 2025


1. DOWA J: This is a ruling on an application for judicial review. The Plaintiff applies for judicial review of the Fifth Respondent’s decision made on 10th November 2009 granting a Special Agricultural and Business Lease (SABL) to the first Respondents, Martin Musom, Paul Mus & Akas Kamdring over a customary land known as Agayokoc, now described as Portion 699C, Milinch Lae, Fourmil Markham, Morobe Province, contained in SABL Volume 17, Folio 180.The SABL was subsequently transferred by the first Respondents to late Henry Francis Chow on or about 2nd December 2009.


FACTS


2. The Applicant comes from Wapic Sokoc Clan of Kamkumung village, Lae, Morobe Province. The Applicant alleges, he is the customary owner of the land known as Agayokoc, now Portion 699C, located along the Independence Drive near Kamkumung village, Lae, Morobe Province.


3. Plaintiff alleges the first Respondents originally from Labuta LLG in the Nawaeb District are residents of portions of land near Bumbu River near Lae city. It is alleged, the first Respondents without the knowledge and consent of the Applicant applied for the grant of SABL over the Agayokoc land.


4. On 10th November 2009, the Fifth Respondent granted a Special Agricultural and Business Lease (SABL) over the said Agayoko land, now Portion 699C, to the first Respondents. The SABL was then sold by the first Respondents and transferred to the second Respondent, Late Henry Francis Chow, on 26th November 2009 which transfer was registered on 2nd December 2009.


5. The Applicant alleges that the fifth Respondent as Minister for Lands, failed to follow the procedures under the Land Act when it granted the SABL to the first Respondents who were not legitimate customary landowners of Agayokoc land.


6. Aggrieved by the Minister’s decision, the Applicant therefore applies for judicial review of the decision of the Minister for Lands and the Secretary for Lands made on 10th November 2009 granting the Special Agricultural and Business Lease (SABL) over the said land. Leave to apply for judicial review was granted 18th February 2021.


The Hearing


8. The matter was heard on 13th September 2022. The parties relied on all affidavit evidence filed in Court and presented both written and oral submissions.


The Applicant’s Evidence


9. The Applicant relies on the following Affidavits:


  1. Affidavit in Support of Tobias Omba filed 22nd September 2020
  2. Affidavit in Support of Joel Done filed 30th June 2021
  3. Additional Affidavit in Support of Tobias Omba filed 27th August 2021
  4. Affidavit in Support of Rex Apuka filed 30th September 2021
  5. Affidavit in Support of John David filed 30th September 2021
  6. Supplementary Affidavit of Tobias Omba filed 4th March 2022
  7. Supplementary Affidavit of Nathan Omba filed 2nd May 2022
  8. Further Affidavit of Tobias Omba filed 2nd May 2022.

10. This is the summary of the Plaintiff’s evidence. The Applicant comes from Wapic clan of Kamkumung village, Lae city, Morobe Province. He alleges the first Respondents, originally from Labuta LLG, Nawaeb District, are residents of portions of land near Bumbu River. He deposed he is the customary owner of the land known as Agayokoc, now Portion 699C, located along the Independence Drive near Kamkumung Village, in Lae, of Morobe Province. The boundary of Agayokoc Land is from Boinamo Gravel along Independence Road all the way to Lae Biscuit Company and extends on the east of the Independence Road until it reaches Bogwalu of Wapic Pom.


11. As the customary owner of the Agayokoc Land, the Applicant and his late father, namely Omba Kamdring have, since the 1980s up to date, leased blocks/portions of the Agayokoc Land to tenants to develop each portion of land leased to them by building permanent properties and reside therein. There are about 111 tenants who with their dependents occupy the Agayokoc Land based on land lease agreements the Applicant and his late father have executed with each of them.


  1. The Applicant deposed that the first Respondents come from Labuta LLG, Nawaeb District. They were invited and allowed to settle on a small portion of land near Bumbu River. The first Respondents have no legal or equitable rights over Agayokoc land and they neither reside nor occupy the Agayokoc Land. The first Respondents know well that the Applicant owns the Agayokoc Land. Even the first Respondent, late Henry Chow has been aware that the applicant and the Wapic Sokoc clan are owners of the Agayokoc land.
  2. On 10th November 2009, the SABL over Agayokoc Land was granted to the First Respondents as joint tenants by the Fifth Respondent, the Minister for Lands and Physical Planning. Then on 2nd December 2009, that is within a span of 3 weeks, the said SABL was subsequently transferred to late Henry Chow.
  3. The Applicant deposed that he was totally surprised and aggrieved when he received a letter from Niugini Lawyers on 20th March 2017, enclosing a copy of the SABL title. He was not aware that the first Respondents applied for the SABL. The Applicant and his clan were not informed of any intention by the State Respondents to acquire the customary land for the grant of SABL. He was not given an opportunity to express his views on the acquisition of the Agayoko land. There was no hearing by the Land Titles Commission nor the Local Land Court hearing to determine the customary ownership over Agayokoc land.
  4. On 13th April 2017, the Applicant instituted judicial review proceeding in the Lae National Court in OS (JR) No 402 of 2017 seeking judicial review of the decision of the Fifth Respondent, who granted the SABL over the customary land (Agayokoc), to the First Respondents. On 23rd August 2019, His Honour Kandakasi, DCJ issued Chamber Orders for parties to engage in out of court settlement discussions including mediation. Parties could not settle the matter. On 18th August 2020 this matter returned to Court before His Honour Kandakasi, DCJ at the ADR/Mediation Call over. The Applicant sought leave and discontinued the proceeding in order to file fresh proceeding after the court was of the view that OS (JR) No. 402 of 2017 was incompetent.
  5. In response to the payment of K 65,000.00 and the Deed of Release, signed by the Applicant and first Respondents on 25th March 2011, the Applicant deposed that he did not understand the terms of the Deed as it was not properly explained to him and his brothers. To him, the money was paid in appreciation of other parcels of land acquired Lae Biscuit Company.

First Respondents Evidence


  1. The first Respondents rely on the following affidavits:
    1. Affidavit of Martin Musom filed 21st September 2021
    2. Affidavit of Paul Mus Kambring filed 21st September 2021
  2. This is the summary of their evidence. They are members Buwalu family of Ahi Wapac Clan of Ahi Tribe, Kamkumung village, Lae, Morobe Province. They are the owners of the customary land now Portion 699C. They invited the Department of Lands and Physical Planning to convert the land into SABL. The Applicant and his brothers did not object to the conversion. After the conversion they sold the land (SABL) to late Henry Chow for K1,000,000.00 in 2008 in an agreement signed on 1st November 2008. When Henry Chow started clearing the land, the applicant and his brother took issue alleging the survey boundaries encroached on to their land. It was only a small portion of the applicants land included in the Portion 699C, mistakenly included in the survey plan. We resolved the issue by paying K 65,000.00 in March 2011. The Applicant and his brothers signed a Deed of Release and agreed that they would not take them to Court over this matter.

Second Respondents Evidence.


  1. The second Respondents rely on the Affidavit of Ian Chow filed 3rd August 2022 and the affidavit of Martin Caberio filed 25th March 2022. This is the summary of their evidence. In 2008 the first Respondents agreed to sell their land Portion 669C to late Sir Henry Chow. He asked the first Respondents to convert the customary land to SABL before he can purchase same. Sir Henry and the first Respondents signed a MOU for the purchase of the land in November 2008. After signing the MOU, Lae Biscuit Co entered the land and started clearing. No one disputed the land.
  2. In early 2009, the first Respondents arranged with the Department of Lands and Physical Planning and got the land converted into SABL on 29th October 2009. On 10th November 2009, the Minister for Lands granted the SABL to the first Respondents. On 26th November 2009, the land was sold to late Sir Henry Chow who registered the transfer on 2nd December 2009 in his name.
  3. Caberio deposed that in 2010 when Lae Biscuit entered the land to develop, they faced opposition by the applicant and his brothers. On 18th January 2011, the applicant wrote to Sir Henry asking him to pay him some money which was declined. The matter was brought to the attention of the first Respondents who agreed to sort it out.
  4. Caberio deposed further that on 25th March 2011, the first Respondents and the applicant resolved the matter. By then Lae Biscuit has paid K935,000.00 to the first Respondents and K 65, 000.00 remained outstanding. It was then agreed that the balance of the purchase price in the sum of K 65,000.00 be paid to the applicant and his brothers. The Applicant and his brothers signed the Deed of Release releasing the first and second Respondents from any further claim or legal action in respect of the land.
  5. Mr. Caberio deposed that the Applicant agreed to sell land known as Agayuko, Portion 103C, Milinch of Lae, Fourmil of Markham owned by the Applicant’s late father for K 1,750,000.00. Late Henry Chow and Lae Biscuit agreed to buy Portion 103 and signed a Memorandum of Understanding on 14th May 2009. While negotiations were ongoing it came to light that the land was sold off to one Mrs. Rosa Miori Flynn in 2002. As the second Respondent had good relations with Mrs. Flynn, the Original Freehold Title was released.
  6. The Applicant was paid K 22,000 in 2009 on signing the MOU. The second payment of K 500,000 was due in 2011 but did not pay because the land was under the Public Curator’s control and thus could not conclude the transaction. The second Respondent then subdivided the land, Portion 103C in November 2009 into Portion 692C. After the subdivision, they could not evict the residents on the land, formerly of Portion 103C who are still residing on the subject land.
  7. In 2017, the second Respondent gave notice to residents of Portion 699C to vacate the land, but they refused, saying they purchased the land from the Applicant. It became apparent that the applicant has sold parcels of Portion 699C illegally to settlers.

The third, fourth, fifth and sixth Respondents’ evidence.


26. The third, fourth, fifth and sixth Respondents rely on the Affidavit of Benjamin Samson sworn 3rd and filed 4th November 2021 Mr Samson is the Secretary for Lands and Physical Planning. He deposed that the former Minister and Secretary for Department of Lands did grant the SABL on 29th October 2009 to the first Respondents under Section 102 of the Land Act 1996.


27. Mr. Samson deposed that the Lease-leaseback instruments pursuant to Section 11(2) of the Land Act 1996 and the Land Investigation Report verifying the customary landowners are not on the Land File for the subject land and can not be produced in Court. On 25th November 2009, the first Respondents entered a contract for sale of the subject land for K1miilion, and the transfer was registered on 2nd December 2009. In paragraphs 10 to 13, Mr Samson relevantly stated the procedure of acquisition of customary land for Lease-leaseback purposes under Section 11 of the Land Act which I shall refer to later in the judgment.


LAW ON JUDICIAL REVIEW


28. The relevant law for judicial review is Order 16 of National Court Rules. Order 16 Rule 1 of the National Court Rules caters for cases appropriate for application for judicial review and provides in this manner:


(1) An application for an order in the nature of mandamus, prohibition, certiorari or quo warranto shall be made by way of an application for judicial review in accordance with this Order.

(2) An application for a declaration or an injunction may be made by way of an application for judicial review, and on such an application the court may grant the declaration or injunction claimed if it considers that, having regard to:

it would be just and convenient for the declaration or injunction to be granted on an application for judicial review.”


29. In Kekedo v Burns Philip (PNG) Ltd [1988-1989] PNGLR 122, the Supreme Court stated that:


“The circumstances under which judicial review may be available are where the decision-making authority exceeds its powers, commits an error of law, commits a breach of natural justice, reaches a decision which no reasonable tribunal could have reached or abuses its powers”.


30. The Supreme Court in that case further stated that:


“The purpose of judicial review is not to examine the reasoning of the subordinate authority with the view to substituting its own opinion. Judicial review is concerned not with the decision but with the decision-making process.


31. In the case Vaki v Baki (2012) N4809, His Honour Kirriwom J said:


“The circumstances under which Judicial Review is available are where the decision- making authority:

(a) Lacks power to make the decision;

(b) Exceeds or abuses its power;

(c) Commits an error of law;

(d) Breaches the principles of natural justice;

(e) Arrives at a decision which no reasonable tribunal would have reached;

(f) Takes into account irrelevant considerations in its decision making process;

(g) Failed to take into account relevant considerations in its decision- making process."


Grounds of Review


32. The grounds for review in the present case are:


a) Errors of law in failing to comply with Sections 9,10,11 and 102 of the Land Act when granting SABL

b) Decision unreasonable under Wednesbury principles.

c) Ultra Vires

d) Failing to take into account relevant considerations

e) Denial of Natural Justice
33. The grounds are repetitive and overlapping and will be dealt with together.


Submissions of Parties


34. Mr. Berem, Counsel for the Applicant, submits that:


  1. the SABL was granted contrary to Sections 9, 10, 11 and 102 of the Land Act in that:
    1. No Land Titles Commission or a Local Land Court was conducted to determine the customary ownership of Agayokoc Land before granting the SABL as the Applicant has substantial interest and there was a dispute over ownership, a breach of Section 9 of the Land Act.
    2. The Minister failed to conduct an inquiry to satisfy himself that the land is not required or likely to be required by customary landowners or by persons on whom the land will or may devolve by custom, contrary to Section 10 of the Land Act.
    3. The Minister failed to secure an Instrument of Lease of customary land, executed by the customary landowners of Agayokoc land, before granting the SABL, contrary to Section 11 (2) of the Land Act.
    4. The Minister erred in granting SABL to the first Respondents whose identities were not evidenced in an Instrument of Lease as being approved or agreed to by the customary landowners to be granted the SABL, contrary to Section 102 (3) of the Land Act.
  2. The decision to grant SABL to the first Respondents was unreasonable without first determining ownership, either by agreement or through the land Titles Commission and the Local Land Court.
  1. The fifth Defendant acted ultra vires his powers to grant the SABL without an Instrument of Lease-leaseback agreement and Land Investigation Report as required by Section 11(3) of the Land Act.
  1. The fifth Defendant failed to consider that the applicant was the customary landowner, that the land was not vacant, and that there was a dispute as to ownership.
  2. The Applicant was not aware of the grant of the SABL. There was no investigations and interview being conducted before the State Lease was granted. The Applicant argues that the acquisition process under Sections 10, 11 and 102 of the Land Act were not followed.

35. The first Respondents, Martin Musom and Paul Mus opposed the application for the following reasons:


  1. They are the rightful owners. They, as owners, agreed to sell the land to the Second Respondent and the Applicants brother Nathan Omba was present when the land was surveyed.
  2. The applicant and his brother did not raise any objections when they applied for the SABL.
  1. The Applicant and his brother Nathan Omba signed a Deed of Release in March 2011 agreeing not to take legal action against the first and second Respondents.
  1. The land now belongs to the second Respondent and the Lae Biscuit Company.

36. Mr. Langah, counsel for the second Respondent, submits that:


  1. Reliefs 2,4,5,6 and 7 of the Notice of Motion filed 4th March 2021 be dismissed for the reason that leave was not granted for those grounds.
  2. The Applicant failed to prove fraud against the second Defendant who is a bona fide purchaser of the SABL from the first Respondents
  1. The applicant does not have a case against the second Respondent because he signed a Deed of Release on 25th March 2011 agreeing not to take legal action against the first and second Respondents
  1. After dismissing the Applicant’s claim, orders be granted for the vacant possession of the subject land.

37. Mr. Tomake, counsel for the State Respondents, submitted that:


  1. No errors of law were committed by the fifth Respondent under Section 9 of the Land Act because there were no conflicting parties nor was there any dispute over ownership requiring a determination of the customary landownership by Land Titles Commission.
  2. The Applicant and his brothers were aware of the application to convert the land into SABL, and they did not raise any objections, thus there is no breach of natural justice
  1. The decision to grant the SABL is not unreasonable despite the lack of evidence of the Land Investigation Report and the Instrument of Lease-leaseback Agreement.

Issues


38. The issues to be considered based on the pleadings, evidence and submissions of parties are:


a. Whether the applicant is a customary owner of Agayokoc land, now Portion 699C.


  1. Whether the minimum requirements of Lease-leaseback agreements and the grant of SABL under Sections 9,10, 11 and 102 of the Land Act were complied with by the State Respondents when granting SABL to the first Respondents over Sagayokoc customary land.
  1. Whether the Applicant is estopped from raising the issue in the proceeding by reason of Deed of Release signed on 25th March 2011.
  1. Whether the second Respondent is an innocent bona fide purshaser
  2. Whether the Applicant is entitled to the reliefs sought in the Notice of Motion for judicial review.
  3. Whether the applicant is owner or part owner of customary land Agayokoc, now Portion 699, the subject land under the SABL.

39. I have considered the pleadings, the affidavits of parties and submissions of counsel and find sufficient evidence indicating that the applicant and his brothers are part owners, if not whole, of Sagayokoc land, now Portion 699C. My reasons are based on the following evidentiary facts.


  1. Portion 103C- Omba Kamdring

40. The evidence shows the Agayukoc land was previously owned by Omba Kamdring as Portion 103C, containing 19.24 hectares. The land was then subdivided by the late Henry Chow in 2009 into Portions 692C and the other Portion is unknown. Could it be Portion 699C, containing 9 hectares. All the parties did not make this clear in their evidence and submissions. None of the parties including the State Defendants attached the schedule to the SABL title of Portion 699C. No Survey Plan Catalogue Number was attached to the SABL. Are the parties talking about the same land formerly described as Portion 103C owned by Omba Kamdring.


41. The first Respondents have admitted in their respective affidavits that when the survey was done it included portions of land from Portion 103, land belonging to the applicant and his family. Portion 103C had an area of 19.24 hectares before it was subdivided. The evidence shows Portion 103 was subdivided, it seems, to make way for Portion 699C. After the subdivision, part of Portion 103C became Portion 692C containing 16.85 hectares. Arithmetically speaking, the land area was reduced by 2.39 hectares. It is a clear encroachment by 2.39 hectares which appears to have been included in Portion 699C.


42. The Respondents have also admitted that a small portion of the Applicants land is included in the SABL, Portion 699C, which they said, was mistakenly surveyed and included in the SABL.


43. I find as a fact that the applicant and his brothers have substantial rights as part owners, if not whole, of Agayokoc land, Portion 699C the subject of the SABL, Volume 17 Folio 180.


b) Whether the third fourth second and fifth Respondents followed due process under the Land Act in granting the SABL


44. In respect of the SABL, the applicant submitted that the first and second Respondents kept the grant of the Lease (SABL) a secret. It was not made known to him until 2017. That there was no investigation by the Department of Lands and Physical Planning, or interviews being carried out before the land was acquired for the Lease-Leaseback arrangement and for the grant of the SABL.


45. There is no dispute that the consent of the applicant was not given. The justification by the first Respondents is that the applicant is not the landowner and the applicant and his brothers, though present, raised no objections when the first Respondents gave their consent for the acquisition of the land by the Department of Lands and Physical Planning. The Respondents submitted that the true owners of the land represented by the first Respondents of the Ahi Wapac Clan have signed the consent for the grant of the SABL.


46. The State Respondents maintain their position that all procedural requirements under the Land Act 1996 have been complied with before the SABL was granted and registered.


47. The procedural requirements for the grant of SABL are governed by the Sections 9, 10, 11 and 102 of the Land Act. The relevant sections are set out hereunder:


“9. INVOLVEMENT OF LAND TITLES COMMISSION OR LAND COURT WHERE CUSTOMARY LAND ACQUIRED.


(1) Where it is intended to acquire customary land under this Act, whether by agreement or by compulsory process, the Minister may apply to the Land Titles Commission or a Local Land Court having jurisdiction over the land that is intended to be acquired, for a determination of the ownership of the land or of interests in the land.

(2) Where the State acquires customary land under this Act, whether by agreement or by compulsory process, the Land Titles Commission or a Local Land Court having jurisdiction over the land that is intended to be acquired, may appoint an agent who may, on behalf of the customary landowners–

(a) execute in his own name all conveyances, transfers, releases and other instruments and do all other acts, matters and things necessary or convenient for effecting that acquisition and vesting the land in the State; and

(b) accept any rent, purchase money, compensation or other moneys or things, and distribute that money or those things to the persons entitled.

(3) A conveyance, transfer, release or other instrument executed, and an act, matter or thing done, in relation to customary land by an agent appointed under Subsection (2) is as valid and effectual for all purposes as if executed or done by all the customary landowners.

(4) The State, or a person taking under the State, is not bound to see to the application of any rent, purchase money, compensation or other moneys or things paid or given to an agent under Subsection (2), and the receipt of the agent is a sufficient discharge.


  1. ACQUISITION OF CUSTOMARY LAND BY AGREEMENT.

(1) Subject to Section 11, customary land shall be acquired in accordance with this Section and shall be authenticated by such instruments and in such manner as are approved by the Minister.

(2) The Minister, on behalf of the State, may acquire customary land on such terms and conditions as are agreed on between him and the customary landowners.

(3) Subject to Subsection (4), the Minister shall not acquire customary land unless he is satisfied, after reasonable inquiry, that the land is not required or likely to be required by the customary landowners or by persons on whom the land will or may devolve by custom.

(4) Where the Minister is satisfied, after reasonable inquiry, that any customary land is not required or likely to be required for a certain period but is of the opinion that the land may be required after that period, he may lease that land from the customary landowners for the whole or a part of that period.

Division 4.

Acquisition of Customary land for Lease-leaseback purposes.

  1. ACQUISITION OF CUSTOMARY LAND FOR THE GRANT OF SPECIAL AGRICULTURAL AND BUSINESS LEASE.

(1) The Minister may lease customary land for the purpose of granting a special agricultural and business lease of the land.

(2) Where the Minister leases customary land under Subsection (1), an instrument of lease in the approved form, executed by or on behalf of the customary landowners, is conclusive evidence that the State has a good title to the lease and that all customary rights in the land, except those which are specifically reserved in the lease, are suspended for the period of the lease to the State.

(3) No rent or other compensation is payable by the State for a lease of customary land under Subsection (1).

...

  1. GRANT OF SPECIAL AGRICULTURAL AND BUSINESS LEASES.

(1) The Minister may grant a lease for special agricultural and business purposes of land acquired under Section 11.

(2) A special agricultural and business lease shall be granted–

(a) to a person or persons; or

(b) to a land group, business group or other incorporated body,

to whom the customary landowners have agreed that such a lease should be granted.

(3) A statement in the instrument of lease in the approved form referred to in Section 11(2) concerning the person, land group, business group or other incorporated body to whom a special agricultural and business lease over the land shall be granted, is conclusive evidence of the identity of the person (whether natural or corporate) to whom the customary landowners agreed that the special agricultural and business lease should be granted.

(4) A special agricultural and business lease may be granted for such period, not exceeding 99 years, as to the Minister seems proper.

(5) Rent is not payable for a special agricultural and business lease.

(6) Sections 49, 68 to 76 inclusive, 82, 83, 84 and 122 do not apply to or in relation to a grant of a special agricultural and business lease.

(7) Notwithstanding anything in this Act, a special agricultural and business lease shall be effective from the date on which it is executed by the Minister and shall be deemed to commence on the date on which the land subject to the lease was leased by the customary landowners to the State under Section 11.”


48. The process of acquisition of customary land for Lease-leaseback purposes is explicitly stated by Benjamin Samson in his Affidavit at paragraphs 10 to 13:


“10. Sections 11 of the Land Act 1996 provides for the process of the acquisition of customary land for Special Agricultural & Business Lease (SABL) purposes while the grant of SABL is stipulated under Section 102 of the Land Act 1996.


11.The requirement for SABL to be good title is the execution of the lease-leaseback Instrument in the approved form between the customary landowners and the Minister for Lands & Physical Planning on behalf the State in accordance with Section 11(2) of the Land Act 1996.


12.Furthermore, pursuant to Section 102 (2) of the Land Act 1996,a SABL shall be granted to:

(a) a person or persons; or

(b) a land group; or

(c) business group; or

(d) other incorporated body,

to whom the customary landowners have agreed that such a lease should be granted.


13.The identification of the customary landowners to whom the SABL shall be granted to is done through a Land Investigation which is captured in a Land Investigation Report.”


49. Reading sections 9, 10, 11 and 102 of the Act together, it is clear before a lease/lease back arrangement is registered for the purposes of a grant of a SABL, the Minister and Department for Lands must conduct an enquiry to ensure that the subject customary land is not required or likely to be required by the customary landowners or by persons on whom the land will or may devolve by custom. That will require the Lands Officers visiting the people at the site and conducting interviews, obtaining their views and consent. That is a mandatory requirement. The customary landowners must agree to lease the land to the state for leaseback purposes. Any agreement reached identifying the persons to be leased back must be reduced in writing in the Instrument of Lease signed by all customary landowners. This is to ensure that the State has good title, and the customary rights are suspended for the period of the lease. This, also, ensures that the persons agreed for the grant are properly identified for the grant of SABL under Section 102 (3) of the Act. Where there are disputes or competing parties, the issue of ownership must be determined first by the Land Titles Commission or the Local Land Court.


50. That has been the view expressed in several judicial pronouncements in the cases, Leahy v Otri (2009) N36860 Musa Valley Management Company Limited v Pepi Kimas (2010) N3827, Mahuru v Dekena (2013) N5305.


51. In Musa Valley v Pepi Kimas (Supra) Cannings J emphasized the requirement for the instrument of lease to be executed by the landowners in the following terms.


“13. It will be observed that – as contended by the applicants – agreement of the customary landowners is an essential precondition to the acquisition by the State, by lease, of customary land under Sections 10 and 11. The key provisions are Section 10(2) – which requires that the land may only be acquired on such terms and conditions "as are agreed on" between the Minister and the customary landowners – and Section 11(2) – which requires that the lease to the State must be "executed by or on behalf of the customary landowners".


52. In Mahuru v Dekena (supra), Cannings J stated the application of Sections 10, 11 and 102 in the following terms:\


26. It is clear from the words of Section 102(1) that before granting a Special Agricultural and Business Lease the Minister must acquire the customary land by lease under Section 11. He must follow the procedures in both Sections 11 and 102. What about Section 10? It has a number of specific requirements about authentication of instruments, agreement on terms and conditions of acquisition and reasonable inquiry by the Minister, which are not found in Section 11. Do the procedures set out in Section 10 also have to be followed?


27. It is possible to read Section 11 as a standalone provision, allowing the Minister to lease customary land and then lease it back, through a Special Agricultural and Business Lease, to persons whom the customary landowners have agreed should be granted such a lease, without any need to follow the more detailed procedures in Section 10. On this construction of the Act, Section 10 could be read as the provision which sets out how the State acquires freehold title to customary land. If the State proposes instead to lease customary land under Section 11 and lease it back under Section 102, Section 10 does not apply.


28. The alternative approach, which I took in Musa Valley Management Company Ltd v Pepi Kimas (2010) N3827, is that Section 11 is not a standalone provision: if the Minister proposes to acquire customary land by lease under Section 11 he must also follow the provisions in Section 10. There was not a lot of argument on this point either in Musa Valley or in the present case. Having reflected on the issue, I am not convinced that I should change my view. I can see that there is a literal argument for the standalone approach as Section 10 begins with the words "Subject to Section 11", which suggests that Section 11 is the prevailing, specific provision, so that if the procedure in it is followed, it is not necessary to follow the procedure in Section 10. However, given the ambiguity in the relationship between these two sections the Court must be acutely aware of their purpose, which is to regulate in a fair and just manner the acquisition by the State of customary land with the agreement of customary landowners. That purpose is best achieved by reading the two provisions together – not as standalone provisions – to ensure that there is genuine agreement by genuine customary landowners and that an obligation is cast upon the Minister to make reasonable inquiries with all interested parties”

.

.....

“30. I maintain the approach I took in Musa Valley. To lawfully grant a Special Agricultural and Business Lease over customary land the Minister must comply with all of the requirements of Sections 10, 11 and 102, which can be summarized as follows:


(a) the Minister must first be satisfied “after reasonable inquiry, that the land is not required or likely to be required by the customary landowners or by persons on whom the land will or may devolve by custom” (s 10(3));

(b) the customary land must then be acquired by the Minister by lease under Section 11(1);

(c) the terms and conditions of that lease must be “agreed between him and the customary landowners” (s 10(2));

(d) acquisition of the land must be “authenticated by such instruments and in such manner as are approved by the Minister” (s 10(1));

(e) the purpose of the Minister leasing the land under Section 11(1) must be for granting a Special Agricultural and Business Lease of that land (s 11(1));

(f) there must be an instrument of lease under Section 11(1) in the approved form executed by or on behalf of the customary landowners (s 11(2));

(g) the customary landowners must agree on the Special Agricultural and Business Lease being granted to the lessees (s 102(2));


(h) there must be a statement of agreement for the purposes of Section 11(2) in the instrument of the Special Agricultural and Business Lease (s 102(3)).”


53. In the present case, the Lands Department has not produced a Land Investigation Report. There is no evidence that an investigation was ever conducted by the Lands Officers. There is no evidence of agreement reached by the landowners, identifying or naming persons who would be granted the SABL. Although the Respondents stated otherwise, they, especially the Lands Department, have not produced the Lease-leaseback agreement/instruments.


54. Mr. Samson, Secretary for Lands and Physical Planning, testified admitting this at paragraph 6 of his affidavit that:


‘’The lease-leaseback instruments pursuant to Section 11 (2) of the Land Act 1996 and the Land Investigation Report verifying the customary landowners are unfortunately not on file and could not be produced to this Honourable Court at this time as the Land File for the subject land which should contain these documents is currently unavailable at our Records Unit.”


55. Mr. Samson, in concluding his evidence, deposed that the first Respondents agreed amongst themselves that the SABL over the subject land be granted in their names, so the Department for Lands and Physical Planning facilitated their request in accordance with Sections 11 and 102 of the Land Act. This conclusion, however, is not supported by evidence, especially where the subject land is occupied by many others whose rights are affected.


56. The evidence from the second Respondent is that they bought the customary land first from the first Respondents. They then surveyed the land and thereafter entered the land. They then arranged for the first Respondents to apply for SABL. The SABL was facilitated by first Respondents to make way for the sale of the land to the second Respondent. This is clear from the swift transactions. The SABL was granted on 10th November 2009, got it sold to the second Respondent on 26th November 2009 and had the transfer registered on 2nd December 2009. As soon as they entered the land in 2010, they faced opposition from the applicant and his brothers and the residents.


57. There is no dispute that the first Respondents applied for the SABL themselves without the consent of the applicant. What is disputed though is that the applicant knew and was aware of the application by the first Respondents but did not object to the application for the SABL which is denied by the Applicant.


58. The result is, I have before me are two competing versions. The Supreme Court in Waranaka v Dusava (2009) SC940 held that where there are two versions in evidence, it is important to assess and analyse the credibility of the witnesses and their evidence and point out any aspect of the performance of each witness before accepting the evidence. The deponents to the various affidavits were not cross-examined. In the absence of cross-examination to assess the demeanour and credibility of the deponents, the Court will apply common sense and logic based on proven facts.


59. After carefully analysing the sworn statements of the parties, I accept the evidence of the applicant that he was not informed by the first Respondents of their application for the SABL over Portion 699C and that there was no investigation carried out by the Lands Department. I reject the contention by the first Respondents that the applicant was present and raised no objections when the Lands Department officers came around. My reasons based on logic and common sense from the proven facts are:


  1. the applicant is the owner or part owner of Portion 699C. This fact has been admitted by the first Respondents. Furthermore, Portion 699C is part of land owned by the applicant’s father Omba Kamdring in Portion 103C which was known as Agayokoc land which was later subdivided.
  2. There was no evidence of agreement reached by all landowners including the Applicant for the acquisition of the land for Lease-leaseback purpose. The evidence of such an important agreement in the form of Lease Instrument has not been produced by the Respondents.
  1. There is no evidence of open and transparent land investigation done by the Lands Department supported by a Land Investigation Report. The third Respondent admitted that they do not have the Report on the Land File.
  1. If an investigation was done, they would have noticed that the applicant had an interest in the land. They would have noticed that more than 100 families are living on the subject land. They would have noticed that the land was part of an existing title in Portion 103C.
  2. Had the Lands Officers attended the site of the customary land concerned, they would have learnt of the ownership disputes over the land. That there are people still living on the land and that they still require the customary use of the land.
  3. The First Respondents sold the land to the second Respondent without the knowledge of the applicant before an application was made for the SABL.
  4. There was potential dispute over ownership. This would require a determination of ownership by the Lands Titles Commission or the Local Land Court. The applicant was not given the opportunity to contest ownership because the application for SABL was done without the knowledge and consent of the applicant.
  5. None of the parties including the Lands Department, attached the schedule to the Certificate of Title. This makes it difficult to understand the area, the map or Survey Catalogue number and the boundaries to the adjoining properties including Portion 692C, formerly Portion 103C.

60. For the foregoing reasons, I find that the third, fourth, and fifth Respondents failed to comply with the mandatory requirements of Section 9, 10,11 and 102 of the Land Act 1996 in granting the SABL to the first Respondents. I find the grant of the SABL was in breach of Sections 10,11 and 102 of the Act and is irregular.


61. I am mindful that the first Respondents have a registered SABL in their name which has been subsequently transferred to the second Respondent. Section 32 of the Land Registration Act provides that where an instrument of title describes a person as the proprietor of an estate or interest, that person is the registered proprietor of the estate or interest. Section 33 of the Land Registration Act provides that a registered proprietor of an estate or interest holds it absolutely free from all encumbrances except for fraud and other exceptions set out in (1)(a) to (f). (Mudge -v- Secretary for Lands (1985) PNG LR 387)


62. Fraud is defined in the head notes of the judgments in the case Vaki Vailala v NHC (2017) N6598 and Pius Tikili v Home Base Real Estate (2017) SC1563 to mean “actual fraud or constructive fraud. Constructive fraud exists where the circumstances of a transfer of title are so unsatisfactory, irregular, or unlawful, it is tantamount to fraud, warranting the setting aside of registration of title.”


63. The law on constructive fraud is now settled in this jurisdiction. Refer to Pius Tikili v Home Base Real Estate Ltd (2017) SC1563, PNG Bible Church Inc v Carol Mandi (2018) SC1724 and Rosemary John v James Nomenda (2010) N3851, Toki v Helai (2016) SC1558, and Vaki Vailala v NHC (2017) N6598 and Mota v Camilus (2017) N6810.


64. In the Pius Tikili case, the Supreme Court has this to say at paragraph 23 concerning constructive fraud:

“His Honour, we consider, should have addressed the meaning of “fraud” in section 33(1)(a) of the Land Registration Act more rigorously. There is now a strong line of Supreme Court decisions that have substantially qualified the concept of indefeasibility of registered title set out in Mudge v Secretary for Lands (1985) PNGLR387.Cases such as Emas Estate Development Pty Ltd v John Mea (1993) PNGLR215,PNG Deep Sea Fishing Ltd v Luke Critten (2010) SC1126 and Lae Bottling Industries Ltd v Lae Rental Homes Ltd (2011) SC1120 support the proposition that in many situations it will not be appropriate to insist on proof of actual fraud before the National Court considers cancelling the registered proprietor’s title. It will be sufficient if constructive or equitable fraud is proven. Constructive fraud exists where the circumstances of a transfer of title are so unsatisfactory, irregular or unlawful, it is tantamount to fraud, warranting the setting aside of registration of title.”


65. In the recent Supreme Court decision in Timothy v Timothy (2022) SC 2282, the Court departed from the decisions in Emas v Mea ( 1993) PNGLR 21, Tikili v Home Base Real Estate Ltd (2017) and other cases and held that “fraud” under Section 33 (1) of the Land Registration Act means actual fraud and proof of actual fraud is required to set aside registration of Title.


66. While the Timothy v Timothy decision is said to have overruled Emas v Mea, the diverging views would be best resolved by a five-men panel bench of the Supreme Court.


67. That said, I am satisfied that the Applicant has established a case of for judicial review whether it is constructive fraud or otherwise. What is clear though is, the State Respondents have clearly failed to comply with Sections 9,10,11 and 102 of the Land Act 1996 in the grant and registration of the SABL over Agayokoc land, Portion 699C in the name of the first Respondents. There are clear errors of both substantive and procedural law warranting a judicial review of the decision. The failure to give an opportunity to the applicant to contest the acquisition of the land and the subsequent application for the SABL was a breach of natural justice. The reliance on the first Respondents statements to grant the SABL without making transparent and independent investigation was unreasonable.


68. For the reasons given, I am satisfied that the Applicant has proved the grounds for judicial review and therefore, I am inclined to grant the orders sought in the judicial review application.


Whether the second Defendant is an innocent bona fide purchaser


69. Counsel for the Respondent, submits that the second Respondent is an innocent bona fide purchaser and he holds an indefeasible title under Section 33(1) of the Land Registration Act.


70. While there is no clear evidence of fraud, the Second Respondent, late Sir Henry Chow, was involved from the beginning. He signed a Memorandum of Understanding with the first Respondents for the purchase of the land in November 2008 even before it was converted into a SABL. Under clause 3 (v) of the MOU, Late Sir Henry agreed to apply to the Department of Lands and Physical Planning for the conversion of the existing Freehold Lease in Portion 103C into State Lease, SABL. When the SABL was granted on 29 October 2009, it was transferred to late Sir Henry chow on 26th November 2009.Even before the land was converted to SABL, the second Respondent knew, there were many people occupying the land at the invitation of the applicant and his late father, Omba Kamdring. Clearly, it cannot be said that the second Respondent was innocent bona fide purchaser.


71. Secondly, the second Respondent did not buy a good Title. The SABL was defective ab initio by reason of its illegality. The SABL was granted without following the process under the Land Act 1996 and is defective and void ab initio.


72. Thirdly, as the illegality of the SABL is now established and the decision to grant the SABL is brought up to this Court and quashed, it follows as a natural consequence that the grant and registration of SABL to the first Respondents and the subsequent transfer to the second Respondents be set aside and cancelled.


c) Whether the Applicant is estopped from raising the issue in the proceeding by reason of Deed of Release signed on 25th March 2011.


73. The first and second Respondents contend that the Applicant is estopped from bringing this action after signing a Deed of Release on 25th March 2011 with the first and second Respondents agreeing that he will not take action against them in respect of parcels of his land included in Portion 699C. In response, the Applicant says he did not understand the contents of the Release and he thought the monies paid to him and his brothers were in appreciation for other portions of land acquired by the second Respondent.


74. A Deed of Release is a contract intended to release a party from an obligation or a civil claim. In NCDC v Yama Security Services Pty Ltd (2003) PNGLR16 the Supreme Court said at page 9 of the judgment:


“A Deed of Release constitutes a settlement or compromise of a pending action. It is a contract which is enforceable on its own force. Its validity and enforceability is dependent on the existence of essential elements of ordinary contracts such as the legal capacity of the contracting parties, the intention of the parties to create legal obligations, valuable considerations offered by each party and in cases where these elements are regulated by statute, compliance with any statutory requirements imposed on contracting parties.”


  1. In Theiss Watkins v PNGEC (1988-89) PNGLR 454, Justice Hinchliffe (as he then was) discussed the issue of estoppel, and adopted the following principles to be applied:

76. Turning to the present case, the applicant contends that the terms of the Deed of Release were not clearly explained to him, and he did not understand them. According to him the payment was made in appreciation of all other lands given to Lae Biscuit Co. Ltd.


77. In my view, the Deed of Release signed 25th March 2011 does not bar the applicant from bringing this action. Firstly, I accept the explanation of the applicant that he did not understand the terms of the Deed of Release. I note the Deed of Release did not expressly acknowledge that part of Applicant’s customary land was included in Portion 699C for which he was being paid. The Deed of Release did not set out details of the land in terms of the area and location he has agreed to relinquish.


78. Secondly, the current judicial review application concerns the decision of the fifth Respondent dated 10th November 2009 which granted the SABL. The decision of the fifth Respondent was not the subject of the Deed of Release.


79. Thirdly, the third, fourth and fifth Respondents who made the decision to grant the SABL without following due process under the Land Act were not parties to the Deed of Release.


80. For the reasons given, the defence of estoppel based on the Deed of Release is rejected.


d) Whether the applicant is entitled to be granted reliefs sought.


81. What orders should the Court make. The Applicant pleaded for the following reliefs:


  1. Pursuant to order 16 Rule 5 of the National Court Rules, a Declaratory order that the Special Agricultural and Business Lease (SABL) of the Agayokoc land, now formally described as Portion 699c, Milinch Lae, Fourmil Markham, Morobe Province, contained Respondent or his delegate on 10th November 2009, is unlawful, ultra vires, unreasonable and null and void.
  2. Pursuant to Order 16 Rule 5 of the National Court Rules, a Declaratory Order that the Local Land Court in Lae or the Land Titles Commission has never mediated, considered, or determined the ownership of the Agayokoc land before acquisition by the Sixth Respondent through the Fifth Respondent or his delegate.
  3. Pursuant to Order 16 Rule 5 of the National Court Rules, a Writ of Certiorari be issued into this Court and the decision of the Fifth Respondent or his delegate to grant the SABL of the Agayokoc land to the First Respondents be quashed forthwith.
  4. A Consequential Order that the subsequent registration of the transfer of the SABL over the Agayokoc land from the First Respondents to the late Henry Francis Chow on 2nd December 2009 is unlawful and ab initio, and be nullified forthwith.
  5. The Fourth Respondent be directed to cancel the SABL registered to the First Respondents on 10th November 2009 and the subsequent transfer to Late Henry Fabian Chow on 2nd December 2009.
  6. An Order that the custody ownership of the Agayokoc land be referred to the Local Land Court for hearing including Mediation.
  7. A declaration that the Application and the 111 tenants are the current occupants of the Agayokoc land.
  8. Costs of and incidental to this proceedings.
  9. Such further orders as the Court deems appropriate.
  10. Time be abridged forthwith.

82. The Court has a discretion to grant all the reliefs sought, or some of them or others as the justice of the case dictates.


83. Mr. Langah, Counsel for the second Respondent, submitted that Terms 2, 4, 5, 6 and 7 of the Notice of Motion be dismissed for the reason that leave was never obtained for those grounds pursuant to Order 16 Rule 3 (1) & (2) of the National Court Rules.


84. The main relief in Term 1 sought in the proceedings is for the review of the decision of the fifth Respondent made on 10th November 2009 granting the SABL and the subsequent transfer to the second Respondent on 2nd December 2009. Leave is only required for the main decision sought to be reviewed. The balance of the reliefs sought in the Notice of Motion are consequential reliefs and they don’t require leave. These reliefs were pleaded in paragraph 3 of the Statement filed pursuant to Order 16 Rule 3 (2) of the National Court Rules. The Court will proceed to consider all the reliefs sought in the Notice of Motion. Again, whether the Court grants all or some of the reliefs sought, remains a discretion of the Court.


85. In the light of my findings and decision, I am prepared to grant orders sought in the substantive Notice of Motion except for orders in Terms 2 and 7.


Costs


86. The applicant claims costs. He has succeeded in his claim. In my discretion costs will be awarded in favour of the Applicant. In my view, the costs be paid by the first, second, third, fourth, fifth, sixth and seventh Respondents. The costs be taxed and the first and second Respondents shall pay 20 % each while the third, fourth, fifth and sixth Respondents pay the balance of 60%. The State Respondents are responsible for the land management and the performance of its statutory functions. They failed in their statutory duties in this case and thus shall pay a bigger portion of the costs.


ORDERS


The Court orders:


  1. That the application for judicial review is substantially granted.
  2. By way of a Declaration that the Special Agricultural and Business Lease (SABL) over land described as Agayokoc, now Portion 699C, Milinch of Lae, Fourmil Markham, Volume 17, Folio 180, granted to the first Respondents by the fifth Respondents or his delegate on 10th November 2009 is in breach of Sections 10,11 and 102 of the Land Act 1996 and therefore is unlawful, null and void.
  3. The Fifth Respondent’s decision of 10th November 2009 that granted the Special Business & Agricultural Lease (SABL) over land described a Agayokoc, Portion 699C, Volume 17, Folio 180, Lae, Morobe Province to the first Respondents is hereby brought up to this Court and quashed forthwith.
  4. That the subsequent registration of the transfer of the SABL over the Agayokoc land from the First Respondents to the second Respondent, the Late Henry Francis Chow, on 2nd December 2009 is unlawful and void ab initio, and is hereby nullified forthwith.
  5. The Fourth Respondent shall cancel the registration of the SABL in favour of the first Respondents on 10th November 2009 and the subsequent registration of transfer to Late Henry Francis Chow on 2nd December 2009.
  6. The Registrar of Titles shall amend its records and do all things necessary under its powers to give effect to orders 3, 4 and 5 above.
  7. The issue of ownership over the land described as Agayokoc, Portion 699C , Lae, Morobe Province between the Applicant and the first Respondents be referred to the Local Land Court for fresh mediation under the Lands Dispute Settlement Act.
  8. The Plaintiff’s costs shall be paid by the first, second, third, fourth, fifth and sixth Defendants. The costs shall be taxed and the first and second Respondents shall pay 20 % each while the third, fourth, fifth and sixth Respondents pay the balance of 60%.
  9. That the entry of these Orders be abridged to the time of settlement which shall take place forthwith.

Berem Lawyers: Lawyers for the Applicant
Paul Mus: first Respondent in person
Albright Lawyers: Lawyers for the second Respondents
Solicitor General: Lawyers for the 3rd,4th,5th & 6th Respondents

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