N11700

PAPUA NEW GUINEA
[NATIONAL COURT OF JUSTICE]

WS NO.  5 74 OF 2023

BETWEEN:
JAROD POMAT on behalf of himself, as a friend of THERESA POMAT, JOHN POMAT & CHRISTOPHER POMAT
Plaintiffs

AND
ENOCH WAIAKALI
First Defendant

AND
NATIONAL HOUSING COOPERATION
Second Defendant

AND
INDEPENDENT STATE OF PAPUA NEW GUINEA
Third Defendant

LAE: DOWA J
16 OCTOBER, 10 DECEMBER 2024
13 FEBRUARY 2026
REAL PROPERTY – plaintiff seeking declaration that title issued to first defendant be declared null and void and that the Plaintiff be given priority to purchase the property-  Whether Plaintiff has standing to institute proceedings where transaction was initiated by plaintiff’s late father-whether orders sought are appropriate where subject property has been subsequently transferred to innocent third party-indefeasibility of title under Section 33 of the Land Registration Act-necessity to plead and prove actual fraud under the Torrens Title registration system
Held: 
Plaintiff had no standing, and that third Party has acquired good title by registration. Plaintiff’s claim dismissed. 

Cases cited

Yooken Paklin v The State (2001) N2212
Jonathan Mangope Paraia v The State (1995) N1343
Samot v Yame (2020) N8266
Mudge  v The Secretary for Lands (1985) PNGLR 387
Mamun Investment v Koim (2015) SC1409
Nondepa Plantation v Balat (2020) SC1927 
Timothy v Timothy (2022) SC2282 
Helai v Samson (2024) SC2625

Counsel

P. Yama, for the plaintiff
M Alu, for the first defendant
M Limu for the second defendant
S Maliaki for the third defendant

JUDGMENT

1.	DOWA J:	This is a decision on liability and damages.

Brief Facts

2.	The proceedings relate to a dispute of ownership of property, Allotment 12 Section 79, Oak street, Eriku, Lae, Morobe Province.  The Plaintiff alleges that National Housing Corporation (NHC) promised to sell the property to his brother, late Christopher Pomat.   They have been residing on the property for more than 30 years.  He alleges NHC failed to keep its promise and has since dealt with the property fraudulently with other parties including the first Defendant. The property was transferred to the first Defendant on 23rd August 2023. The Plaintiff seeks an order that the transfer of the title from National Housing Corporation to the first Defendant be declared null and void and that NHC be compelled to give first right of refusal to the Plaintiff to purchase the property.

3.	The Defendants deny the claim pleading that the Plaintiff has no right of action; and that the first Defendant obtained good title by following outright purchase from NHC and has indefeasible title by registration. Enoch Waiakali, the first defendant, filed a Defence pleading that he is the current registered owner of the subject property.  He paid K 282,975.50 for the property in August 2021.  He pleads the transfer of title to him was registered on 23rd August 2023 and that he has indefeasible title.

Evidence-Plaintiff

4.	By agreement the trial was conducted by way of tender of Affidavits. The Plaintiff relies on the following Affidavits:

a.	Affidavit of Jarrod Pomat filed 29th February 2024 -Exhibit P1
b.	Affidavit of Jarrod Pomat filed 13th June 2024 -Exhibit P2

5.	This is the summary of the Plaintiff’s evidence. The Plaintiff’s parents tenanted the NHC property in 1979. John Pomat was the first Tenant. He passed away in 2004. In December 2004, NHC entered a new tenancy agreement with Theresa Pomat, the Plaintiff’s mother. In May 2011, NHC entered a tenancy agreement with Christopher Pomat, the Plaintiff’s brother. Christopher Pomat wrote to NHC to purchase the property but received no favorable response. Christopher Pomat died in 2020. Since the death of the late brother, Plaintiff made several enquiries with NHC but again received no favorable response. In September 2023, Plaintiff was surprised when he was served with eviction notice from the first Defendant. Plaintiff deposed that the transaction between NHC and the first Defendant was fraudulent as the Plaintiff’s family has always been tenants of the subject property and were not given a fair chance to buy the property.

First Defendant

6.	First Defendant relies on the following Affidavits:

a.	Affidavit of Enoch Waiakali filed 15th March 2024- Exhibit 1D1
b.	Affidavit of Mark Joe Alu filed 13th May 2024-Exhibit 1D2
c.	Affidavit of Enoch Waiakali filed 22nd July 2024 Exhibit 1D3

7.	This is the summary of the first Defendant’s evidence. The first defendant is self-employed and a resident of Lae in the Morobe Province. He is the current registered owner of the property, Allotment 12 Section 79, Lae. He purchased the property from NHC in 2021. He expressed his interest in writing to NHC in February 2015. NHC sent an offer to sell the property to the first defendant on 27th July 2021. The first defendant accepted the offer in August 2021 and made a deposit on 6th August 2021. Conveyance documents were executed in September 2021. Settlement took place in August 2023 when first Defendant paid the balance of the purchase price on 17th August 2023. On 23rd August 2023, the transfer of title was registered in the name of the first Defendant. First Defendant deposed he has indefeasible title and denies the allegations of fraud.

8.	NHC relies on the following Affidavits:

a.	Affidavit of Paul Ero filed 6th June 2024- Exhibit 2D1
b.	Affidavit of Paul Ero filed 8th July 2024-Exhibit 2D2
c.	Affidavit of Paul Ero filed 13th September 2024-Exhibit 2D3

9.	Paul Ero is the Estates Officer in the employ of NHC. He deposed the subject property, Allotment 12 Section 79, Lae was initially tenanted by John Pomat. Upon his retirement, his wife Theresa took over the tenancy in a new agreement in December 2004.  In 2008, Theresa Pomat appointed their son Christopher Pomat to continue the tenancy and pay the rent. In October 2010, Christopher Pomat sent a letter of interest to NHC to purchase the property. At that time, NHC and Christopher Pomat entered an agreement for Pomat to rent the property at K200.00 per fortnight and settle all outstanding rentals of K17,600.00. No rental payments were made and Christopher Pomat passed away in 2020. The outstanding rent accrued and stood at K70,000.00 in 2021. On 16th February 2021, notice to vacate was issued to the occupants of the subject property. Paul Ero deposed that NHC’s tenants were John Pomat, Theresa Pomat and Christopher Pomat, who are all deceased and NHC has no transactions with the Plaintiff.

Issues

10.	The issues based on pleadings, evidence and submissions are: 

a.	Whether the Plaintiff has standing to institute the proceedings.
b.	Whether the Plaintiff is entitled to the reliefs sought in the proceedings. 

Burden of Proof

11.	The burden of proving the claim rests on the Plaintiff and he must discharge the burden on the balance of probabilities. Refer: Yooken Paklin v The State (2001) N2212,  Jonathan Mangope Paraia v The State (1995) N1343, and Samot v Yame (2020) N8266.

a.	Whether the Plaintiff has standing to institute the proceedings.

12.	The issue of standing was previously raised by the fourth Defendant in an interlocutory application. I made a ruling then (14th June 2024) which did not exhaustively determine the matter. It is open to the Court to deal with the issue in the light of evidence presented.

13.	 The Defendants submitted that the Plaintiff does not have standing to bring this action in that the arrangement with NHC was made by the Plaintiff’s late parents, John and Theresa Pomat and late brother Christopher Pomat and not the Plaintiff.  Plaintiffs’ response is that he was the occupant of the property and was present when his late parents and brother were occupying the property as legitimate tenants. He was aware of late Christopher Pomat who made an offer to purchase the property. He made enquiries and was awaiting further advice from NHC. 
  
14.	Apart from the tenancy agreements with deceased parents and brother and several copies of correspondences between NHC and Christopher Pomat, the Plaintiff has not produced any other documentary evidence that he is the tenant of NHC. It is possible that the Plaintiff may have been occupying the property, but that would be unauthorized. Rights to occupy NHC managed properties are governed by the National Housing Corporation Act. All tenancy and outright purchases are subject to the NHC Act. The Plaintiff does not fall into any category of eligible people under Sections 2 and 3 for tenancy nor Sections 37 and 38 for outright purchase of NHC managed properties by a sitting tenant.

15.	The people that had equitable rights on the property were his late parents and brother by virtue of their tenancy agreement with NHC.  The Plaintiff is not a tenant and has no legal or equitable interest in the property. 

16.	The latest tenant Christopher Pomat died intestate. On his death, the late Christopher Pomats’s estate would have reverted to the Office of Public Trustee of Papua New Ginea for management. Section 44 of the Wills, Probate and Administration Act, provides that unless probate or administration is granted, the property of a deceased person vests in the Public Curator. He is not a legal representative of the estate. There is no evidence that he is the administrator of the estate of late Christopher Pomat either by grant of Probate or Administration.

17.	 In the end, I find the Plaintiff does not have standing to institute these proceedings. 

18.	The result is that the relief sought by the Plaintiff shall be refused. 

b.	Whether the Plaintiff is entitled to the reliefs sought in the proceedings. 

19.	Even if I am wrong in my ruling on standing, I am of the view that the Plaintiff’s proceeding be dismissed on its merits.

20.	The first Defendant is the registered proprietor after purchasing the property from NHC and has an indefeasible title.  The first Defendant produced, a copy of the State Lease title registered in his name, issued under State Lease, Volume 29 Folio 39 over the subject land, Allotment 12, Section 79, Lae. 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). 

21.	Although the Plaintiff submitted that the property was transferred to the first Defendant by fraud, the Plaintiff was and is not the sitting tenant to base a claim under Sections 37 and 38 of the National Housing Corporation Act. He has no interest in being given the first right of refusal.  The legitimate people having a right to complain would be late Christopher Pomat, who is now deceased. NHC has a discretion to dispose of its properties to anyone under the Cash Sale Scheme or outright purchase scheme subject to the provisions of the National Housing Corporation Act and in accordance with law. Given undisputed evidence presented on substantial outstanding rentals owed by the Pomats, NHC was entitled to deal with the property. There is no evidence of irregularity on the part of NHC.

22.	Finally, the transfer and registration of title involve the Registrar of Titles and the Department of Lands and Physical Planning. To disturb the transfer and registration of title (indefeasibility of title) under the Torrens Title registration system, Plaintiff has the onus to plead and prove fraud. The preponderance of judicial pronouncements by the Supreme Court is that actual fraud be proved against the registered title holder to disturb indefeasibility of title accorded by Section 33 of the Land Registration Act. See Mudge v The Secretary for Lands (1985) PNGLR 387, Mamun Investment (2015) SC1409, Nondepa Plantation v Balat (2020) SC1927, Timothy v Timothy (2022) SC2282 and Helai v Samson (2024) SC2625.

23.	 The Plaintiff did not sufficiently plead and prove actual fraud against the registered proprietor, the first Defendant. 

24.	The Plaintiff has the burden to prove fraud and irregularity on the balance of probabilities. I am not satisfied that the Plaintiff has discharged the burden of proof. I find the Defendants not liable and the Plaintiff is therefore not entitled to the reliefs sought.

25.	Based on reasons given in my ruling, the Plaintiff’s proceedings shall be dismissed with costs. 

Orders

26.      The Court orders that:

1.	 The Plaintiff’s proceedings are dismissed.
2.	The Plaintiff shall pay the Defendants’ costs, to be taxed, if not agreed.
3.	Time is abridged.

Lawyers for the plaintiff: Miles Lawyers	
Lawyers for the first defendant: Supasonix & Alu Lawyers
Lawyer for the second defendant: NHC In-house Lawyer         
Lawyer for the third defendant: Solicitor General