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Imora v Special Mining Lease Osikaiyang Landowners Association Inc (5-4832) [2020] PGSC 141; SC2051 (24 December 2020)

SC2051

PAPUA NEW GUINEA
[IN THE SUPREME COURT OF JUSTICE]

SCA NO 110 OF 2018

STEVEN TAMPURA IMORA
First Appellant

JOSEPH NUASI DAMANA
Second Appellant

ANTHONY TAPAKAU TORI
Third Appellant

LUCY MANGONA BAKAMARI
Fourth Appellant

V

SPECIAL MINING LEASE OSIKAIYANG
LANDOWNERS ASSOCIATION INC (5-4832)
Respondent

ON THE PAPERS: Cannings J, Hartshorn J, Makail J
2020: 26^th November, 24^th December

JUDGMENTS AND ORDERS – application for dismissal of proceedings in which only a declaration and injunction were sought – whether a real controversy exists – whether legal rights at issue – whether issues involved are real, and not merely hypothetical – whether proceedings seeking a declaration and injunction fail to disclose a reasonable cause of action, are frivolous, vexatious or an abuse of process – National Court Rules, Order 12, Rule 40(1)(a), (b), (c).

The appellants commenced proceedings in the National Court by originating summons seeking a declaration that the respondent was not an approved landowner organization and an injunction restraining it from holding itself out as an approved landowner organization. The National Court upheld an application by the respondent for summary disposal of the proceedings under Order 12, Rule 40(1)(a), (b) and (c) of the National Court Rules on the basis that the originating summons disclosed no reasonable cause of action, was frivolous and an abuse of process. The primary Judge came to that conclusion after determining there was no evidence that the respondent had held itself out as an approved landowner organization or expressed any intention to do so, and therefore there was no real controversy between the parties capable of being adjudicated upon by the Court. The appellants appealed to the Supreme Court against the National Court’s decision to dismiss the proceedings, their main argument being that the primary Judge erred in law by not applying the proper test to determine whether the proceedings ought to be dismissed. The appellants argued that the primary Judge was simply required to consider whether serious issues of law or mixed fact and law arose and if he had done that, it would have been concluded that serious issues did in fact arise and the proceedings would not have been dismissed.

Held:

(1) A declaration is a discretionary remedy that should only be granted where there exists a real controversy between the parties to the proceedings, a legal right is at issue, the party seeking it has a proper or tangible interest in obtaining it, the controversy is within the court’s jurisdiction, the defendant has a proper or tangible interest in opposing the plaintiff’s claim and the issues involved are real, and not merely of academic interest or hypothetical (Ok Tedi Mining Ltd v Niugini Insurance Corporation (No 2) [1988-89] PNGLR 425, The State v Central Provincial Government (2009) SC977, Pius Pundi v Chris Rupen & National Maritime Safety Authority (2015) SC1430, based on Russian Commercial and Industrial Bank v British Bank for Foreign Trade Ltd [1921] 2 AC 438).

(2) The originating summons failed to meet all the above criteria, in particular there was no evidence of a real controversy or dispute between the parties as there was no evidence that the respondent was holding itself out as a registered landowner organization or had any intention of doing so, the appellants’ legal rights were not in issue, the appellants had no proper or tangible interest in seeking the declaration or injunction sought and the issues were therefore hypothetical.

(3) National Court proceedings that fail to meet the above criteria will almost invariably disclose no reasonable cause of action, be frivolous and an abuse of process and therefore susceptible to summary dismissal under Order 12, Rule 40(1)(a), (b) and (c) of the National Court Rules.

(4) The National Court applied the proper test in concluding that the proceedings ought to be dismissed. There was no error of law in the exercise of the National Court’s discretion.

(5) Appeal dismissed, with costs.

Cases Cited

The following cases are cited in the judgment:

Papua New Guinea Cases

Ok Tedi Mining Ltd v Niugini Insurance Corporation (No 2) [1988-89] PNGLR 425
Pius Pundi v Chris Rupen & National Maritime Safety Authority (2015) SC1430
The State v Central Provincial Government (2009) SC977
Waigani Heights Development Ltd v Benjamin Mul (2018) N7162

Overseas Cases

Russian Commercial and Industrial Bank v British Bank for Foreign Trade Ltd [1921] 2 AC 438

APPEAL

This was an appeal against a decision of the National Court to summarily dismiss proceedings under Order 12, Rule 40(1)(a), (b) and (c) of the National Court Rules.

Counsel

G Geroro, for the Appellants
A Mana, for the Respondent

24^th December, 2020

1. BY THE COURT: Steven Tampura Imora and three other landowners from the Panguna area in the Autonomous Region of Bougainville appeal against the decision of the National Court to summarily dismiss proceedings, OS 208 of 2018, that they commenced against the respondent, Special Mining Lease Osikaiyang Landowners Association Inc.

NATIONAL COURT PROCEEDINGS, OS 208 OF 2018

2. The appellants commenced those proceedings, seeking a declaration that the respondent was not an approved landowner organization under s 35 of the Bougainville Mining Act 2015 and a permanent injunction restraining it from holding itself out as such an organization.

3. On 22 June 2018 the National Court heard a motion by the respondent for summary disposal of the proceedings. The primary Judge delivered an ex tempore ruling.

4. After hearing the respondent’s central argument that there was no legal controversy between the parties, the primary Judge considered in detail the main piece of evidence that the appellants relied on to demonstrate the existence of a legal controversy, which was a deed of settlement executed for the purposes of separate National Court proceedings, OS 452 of 2017, between, amongst others, Philip Miriori and Lawrence Daveona. The controversy in those proceedings was who was the proper chairperson of the respondent, Special Mining Lease Osikaiyang Landowners Association Inc: Miriori or Daveona? In the deed of settlement the parties agreed, amongst other things, that:

• Miriori was the chairperson;
  
• Daveona and others aligned with him would not act inconsistently with the objectives of the respondent including “in respect of any matter relating to the development of the Panguna mine”;
  
• Daveona and Miriori would work cooperatively with each other in seeking to further the aims and objectives of the respondent “in respect of any matter relating to the development of the Panguna mine”, including working together to unite the members behind the aims and objectives of Miriori and the respondent “in the appointment of RTG Mining Inc as the developer for any redevelopment of the Panguna Mine”.
  

5. His Honour held that the deed of settlement had no bearing on any matters relating to redevelopment of the Panguna mine as there was no evidence that the respondent had done anything regarding that issue and no evidence that the respondent had taken any steps to have RTG Mining Inc engaged for redevelopment of the Panguna mine. His Honour relied on the leading case of Russian Commercial and Industrial Bank v British Bank for Foreign Trade Ltd [1921] 2 AC 438 to conclude that there was no legal controversy between the appellants and the respondent.

6. His Honour found that there was no evidence that the respondent had held itself out as an approved landowner organization or expressed any intention to do so, and therefore there was no real controversy between the parties capable of being adjudicated upon by the Court.

7. His Honour concluded that the proceedings ought to be dismissed under Order 12, Rule 40(1)(a), (b) and (c) of the National Court Rules on the basis that the originating summons disclosed no reasonable cause of action and was frivolous and an abuse of process.

THE APPEAL

8. The appellants’ main argument emerging from the 18 grounds of appeal is that the primary Judge erred in law by not applying the proper test to determine whether the proceedings ought to be dismissed.

9. The appellants argue that the primary Judge was simply required to consider whether serious issues of law or mixed fact and law arose and if he had done that, he would have concluded that serious issues did in fact arise and the proceedings should not be dismissed.

DID THE PRIMARY JUDGE APPLY THE PROPER TEST?

10. Yes, his Honour did apply the proper test. His Honour was rightly focussing on identifying what the legal controversy was between the appellants, as plaintiffs, and the respondent, as defendant. The appellants sought just two remedies in the originating summons: a declaration and an injunction.

11. His Honour properly took into account that a declaration is a discretionary remedy that should only be granted where:

• there exists a real controversy between the parties to the proceedings;
  
• a legal right is at issue;
  
• the party seeking it has a proper or tangible interest in obtaining it;
  
• the controversy is within the court’s jurisdiction;
  
• the defendant has a proper or tangible interest in opposing the plaintiff’s claim; and
  
• the issues involved are real, and not merely of academic interest or hypothetical (Ok Tedi Mining Ltd v Niugini Insurance Corporation (No 2) [1988-89] PNGLR 425, The State v Central Provincial Government (2009) SC977, Pius Pundi v Chris Rupen & National Maritime Safety Authority (2015) SC1430, Waigani Heights Development Ltd v Benjamin Mul (2018) N7162, based on Russian Commercial and Industrial Bank v British Bank for Foreign Trade Ltd [1921] 2 AC 438).
  

12. We agree with his Honour’s conclusion that the originating summons failed to meet all the above criteria, in particular there was no evidence of a real controversy or dispute between the parties. There was no evidence that the respondent was holding itself out as a registered landowner organization or had any intention of doing so. We agree with his Honour’s analysis of the deed of settlement relating to OS 452 of 2017. It was foreshadowing a possible future scenario in which the respondent might be involved with another preferred entity in redeveloping the Panguna mine. The originating summons was raising hypothetical issues.

13. The appellants’ legal rights were not in issue and the appellants had no proper or tangible interest in seeking the declaration or injunction sought.

14. We consider that any National Court proceedings that fail to meet the criteria based on the leading case of Russian Commercial and Industrial Bank v British Bank for Foreign Trade Ltd [1921] 2 AC 438, will almost invariably disclose no reasonable cause of action, be frivolous and an abuse of process and therefore susceptible to summary dismissal under Order 12, Rule 40(1)(a), (b) and (c) of the National Court Rules.

15. We reject the appellants’ primary argument. The primary Judge applied the proper test. If his Honour had simply adopted the approach contended for by the appellants – whether serious issues of law or mixed fact and law arose – it might have been the case that a different conclusion would have been reached. But not necessarily. In our view no serious issues of law or mixed fact or law arose in the National Court proceedings.

CONCLUSION

16. All grounds of appeal (which are incorporated into the appellants’ primary argument outlined above) are dismissed. The learned primary Judge did not err in dismissing the National Court proceedings. The test adopted by his Honour was the proper test and it was correctly applied. It follows that this appeal must be dismissed, that the decision of the National Court will be affirmed and that costs will follow the event.

ORDER

(1) The appeal is dismissed.

(2) The judgment of the National Court of 22 June 2018 in OS No 208 of 2018 is affirmed.

(3) The appellants shall pay the respondent’s costs of the appeal on a party-party basis which shall if not agreed be taxed.

Judgment accordingly.

________________________________________________________________
Geroro Lawyers: Lawyers for the Appellants
Corrs Chambers Westgarth Lawyers: Lawyers for the Respondent