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PNG Power Ltd v Minimbi [2025] PGNC 404; N11540 (21 October 2025)

N11540


PAPUA NEW GUINEA
[NATIONAL COURT OF JUSTICE]


OS NO. 205 OF OF 2025


BETWEEN:
PNG POWER LIMITED
Plaintiff


AND
LEAH MINIMBI
Defendant


LAE: DOWA J
15, 21 OCTOBER 2025


CIVIL jurisdiction-Plaintiff seeks declaratory orders that it has the authority under Electricity Industry Act to enter Defendants land to erect power lines and other ancillary orders-Whether Plaintiff has authority to enter defendants land -Whether offer made for compensation is fair and just.


Held:


1) Plaintiff, as electrical undertaker, is authorised under the Electricity Industry Act to enter Defendants land for the purposes of carrying out works necessary in setting up power lines, which is an essential service for the public interest.


2) Just and fair compensation be paid for land that is subject to section 33 of the Land Registration Act.


Cases cited
Mudge -v- Secretary for Lands [1985] PNGLR 387


Counsel
Mr. L. Vava for the plaintiff
Mr. T. Berem for the defendant


DECISION


  1. DOWA J: This is a decision on the Plaintiff’s application seeking various declaratory orders.
  2. The Plaintiff, in its Originating Summons, seeks the following orders:

Facts

  1. The Defendant is the registered proprietor of land described as Portion 864C, Milinch of Erap, Fourmil Markham, Morobe Province, under a Certificate of Title, Volume 35 Folio 79, containing an area of 1.34 hectares.
  2. The Plaintiff, PNG Power Limited, is a state-owned company incorporated under the Companies Act. The Plaintiff is responsible for production and supply of electricity in Papua New Guinea. Plaintiff has embarked on a new project called PNG Power Ramu Transmission System Reinforcement Project to construct and erect transmission lines along the Markham Valley into Lae. It is a national infrastructure project funded by the Japanese Government (JICA). According to the Plaintiff, the project is important to improve efficiency, reliable power connections and increase capacity resulting in sustained economic development. It is inline with the National Government Development Plans.
  3. The Plaintiff’s Ramu Grid project will run through the Defendant’s property, Portion 864C, situated at Munum, adjacent to Okuk Highway. The Plaintiff intended to set up a tower base and entered negotiations to compensate the Defendant. The Defendant refused the amount of K495,000.00 offered. The Plaintiff has erected the Tower elsewhere. However, the power lines will run through the Plaintiff’s property, and the Plaintiff has offered K75,000.00 to compensate for the improvements in the affected area which the Defendant refused and insisted on being paid a larger amount before the lines are run through for transmission. The refusal for the lines to run through the Defendant’s land delayed the swift implementation of the project.
  4. This prompted the Plaintiff to bring the current action.
  5. The Defendant opposed the application. The Defendant says her land has substantial commercial/economic value as it is along the highway. She has plans to set up a fuel station. The power lines running through her land will affect 2791 square meters of her land and this area will be given up creating easement for the lines to run through. She has asked for fair compensation based on the Valuer General’s valuation including resurveying costs totalling K556,200.00 but the Plaintiff rejected same. The Plaintiff offered K75,000 instead, which the Defendant refused to accept.

Issues


  1. The issues for consideration are:
    1. Whether the Plaintiff has authority to enter the Defendant’s land to run its power lines without interruption.
    2. Whether the Plaintiff’s offer of K75, 000 is fair and just compensation.
    1. What orders should the Court make.
      1. Whether the Plaintiff has authority to enter the Defendant’s land to run its power lines without interruption.
  2. The Plaintiff as a state-owned company (and entity) is entrusted with the role of power production and supply in Papua New Guinea. As the principal electricity undertaker, its activities are governed by Electricity Industry Act 1970, especially Sections 25 to 30. The Plaintiff is authorised to enter any land with prior notice for the purpose of carrying out works necessary for supply and distribution of electricity. The exercise of such power is subject to approval of the head of state and the relevant Minister. Where approval is given for the erection of electricity lines in, through, over, across any land or building that is subject to the Land Registration Act, such approval together with survey plans shall be forwarded to the Registrar of Titles for noting and registration of easement against any registered Title or interest.
  3. Section 59 of the Electricity Industry Act provides that where loss or damage is suffered by a person by reason of the exercise of power by the electricity undertaker, compensation is payable by the undertaker in such amounts as determined by the Minister; and where a person is not happy with the Ministerial determination, he may appeal the decision to the National Court.
  4. In the present case, there is no dispute that the project is authorised by the Papua New Guinea Government through its development plans. Approval is given to the Plaintiff as the electricity undertaker to carry out works relevant to the production and supply of electricity for the benefit of the consumers. Substantial financial commitments were made, and the project has been delayed for some time now. Electricity is an essential service to the public pursuant to section 2 of the Essential Services Act 2002.It is in the national and public interest to proceed with the project without further delay and hinderance.
  5. I therefore find that the Plaintiff, as electricity undertaker, has the authority to enter the Defendant’s land, Portion 864C to carry out works relevant to the production and supply of electricity, an essential service to the public without further hinderance.
    1. Whether the Plaintiff’s offer of K75,000.00 is just and fair compensation for the Defendant’s land.

13. The Defendant is the registered proprietor. She has produced, a Certificate of Title, Volume 35 Folio 79 over the subject land, Portion 864C, registered in her name. 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).


14. The encumbrance in the form of easement relied on by the Plaintiff under subsection 1 (b) of the Act is yet to be created and registered. In my view, such an interest is created upon approval by the government and due compensation is paid in accordance with ministerial determination.


15. It is common ground that approval was given for the Plaintiff to enter the Defendant’s land many years ago. Parties have negotiated and a determination was made for compensation based on Valuer General’s valuation. According to the valuation report done 21st April 2022 and signed 6th September 2022, the value for the affected area of 2791.12 square meters was fixed at K495,000.00.


16. According to Mr. Hitlar Alseth, Plaintiff’s Project Manager, an offer of K495,000.00 was made to the Defendant but was rejected. This was however refuted by the Defendant, Leah Minimbi, who deposed that she did not reject the offer. Rather, she requested an additional K60,500 being costs for the survey. She made several follow-ups but received no response. The Plaintiff has since relocated their tower to another location.


17. The Plaintiff subsequently made an offer of K75,000.00 to run power lines. The Plaintiff argues this amount is for the improvements only as the land is still usable by the Defendant. The Defendant argues otherwise submitting the lines will run through her land affecting 2791.12 square meters making it difficult and unsafe to use the land. I have perused the plans where the power lines will run through and note it will affect 2791.12 square meters of the Defendant’s land. Under sections 25 (3) and 29 (b) of the Electricity Industry Act 1970, affected land where easements are created include erection of electric lines in, through, over, and across any land and improvements over land registered under the Land Registration Act. I note the offer of K75,000.00 is only for the improvements based on the valuation report and does not include the land. In my view the separation of the land from the improvements for purposes of calculating the amount for compensation is inconsistent with the Electricity Industry Act and the Land Registration Act. The correct amount should be K 495,000.00 which is for both land and improvements. This is because once the power lines run through, the affected part of the property becomes an easement, and ownership reverts to the Plaintiff. The Defendant will have relinquished her proprietary rights and can no longer use the land. As for the additional K60,500.00, the Plaintiff has the option to pay that in which case, the Defendant will attend to subdivision and registering new plans reflecting the changes, or the Plaintiff proceeds to securing the easement by itself at its own costs.


18. I conclude that the Defendant is entitled to compensation for the affected area (2,791.12 square meters) and the offer of K75,000.00 is not a fair and just compensation. The fair and just compensation is the amount that was determined by the Value General’s Valuation Report in the sum of K495,000.00. The Plaintiff shall pay that amount and pay costs associated with the creation and registration of the easement.


Conclusion


19. I have reached a conclusion based on my findings that the Plaintiff as electricity undertaker has the authority to enter the Defendant’s land to carry out works relevant to the production and supply of electricity, an essential service for the benefit of the public without much hinderance subject to fair and just compensation being paid to the Defendant for the loss of her land. The offer of K75,000 is not a just and fair compensation. The correct amount is K495,000 and the Plaintiff shall pay K495,000.00.


c. What orders should the Court make.


20. What orders should the Court make. Based on the reasons given in the judgment, Reliefs 1 and 2 will be granted with modification. For Relief No.3, the amount of K75.000 offered for compensation is unreasonable, not fair and just compensation and is rejected. The amount for compensation to be paid is the amount initially agreed to by the parties as per the Valuer General’s Valuation Report. The K75,000.00 offer shall be replaced with an order for compensation in the sum of K495,000.00. Relief 4 shall be granted with modification. Relief No. 5 is refused as there is no evidence warranting the grant of the order sought.


21. The Court will also order that the Plaintiff shall at its own costs attend to the creation of the easement including costs for subdivision and survey plans.


Costs
22. Costs is a matter for discretion. Generally, a successful party is entitled to costs. Both parties were unreasonable in reaching agreement to settle. Be that as it may, the Plaintiff has succeeded substantially and thus is entitled to the 60% of its costs after taxation.


Orders

23. The Court orders:

  1. In the nature of a DECLARATION that the supply of electricity throughout Papua New Guinea is an essential service pursuant to section 2 (a) of the Essential Services Act 2002 and cannot be disrupted or stopped due to claims for compensation by the Defendant.
  2. That the Plaintiff, its servants, agents and contractors be permitted to enter the land described as Portion 864C Markham to carry out the necessary works in setting up power lines pursuant to section 26 of the Electricity Industry Act.
  3. By way of a DECLARATION that the Plaintiff’s offer of K75,000 to the Defendant based on the valuation report of 06th September 2022, for the Plaintiff to run power lines only over the Defendant’s property is not fair and just compensation.
  4. By way of a Declaration that the just and fair compensation for erecting power lines across, over and above the Defendant’s land based on the valuation report of 6th September 2022 is K 495,000.00.
  5. The Plaintiff shall pay the Defendant K 495,000.00 as compensation to the Plaintiff for the loss of her property covering an area of 2791.12 square meters identified by the parties.
  6. The Defendant and her agents, associates, servants are restrained from causing any intimidation, harassment and threatening of any employees, servants, agents and contractors of the Plaintiff from carrying out their lawful duties.
  7. The Plaintiff shall, in consultation with the Defendant, attend to the creation and registration of the easement on the subject land at its own costs.
  8. The Defendant shall pay 60% of the Plaintiff’s costs after taxation
  9. Time is abridged

__________________________________________________________
Lawyers for the plaintiff: Vava Lawyers
Lawyers the defendant: Berem Lawyers

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