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• N8201
  PAPUA NEW GUINEA
  [IN THE NATIONAL COURT OF JUSTICE]

  OS (JR) NO. 403 OF 2004

  JAMES HARIVA LOHORO
  First Plaintiff

  And
  ERE KILAVI INCORPORATED LAND GROUP Within the Vailala TRP
  area
  Second Plaintiff

  And
  KORE EVERE
  Third Plaintiff

  And
  LAULA MEAHU INCORPORATED LAND GROUP Within the Vailala TRP
  area
  Fourth Plaintiff

  And
  KILALA KARIKARA
  Fifth Plaintiff

  And
  AVOILA CLAN INCORPORATED LAND GROUP Within the Vailala TRP
  area
  Sixth Plaintiff

  And
  JOE MERE
  Seventh Plaintiff

  And
  KAO HARUIPI NO.02 INCORPORATED LAND GROUP Within the Vailala
  TRP
  Eighth Plaintiff

  And
  MORGAN MUKARI
  Ninth Plaintiff

  And
  MIARO CLAN INCORPORATED LAND GROUP Within the Vailala TRP

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• Tenth Plaintiff

  And
  EVAN EVARAPO
  Eleventh Plaintiff

  And
  LULU CLAN INCORPORATED LAND GROUP Within the Vailala TRP
  Twelfth Plaintiff

  And
  IVAN KEO URUMA
  Thirteen Plaintiff

  And
  MIHIRE OUKA INCORPORATED LAND GROUP Within the Vailala TRP
  Fourteenth Plaintiff

  And
  MORGAN SARE
  Fifteen Plaintiff

  And
  ALUVE INCORPORATED LAND GROUP Within the Vailala TRP
  Sixteenth Plaintiff

  And
  ANDREW MUKARI
  Seventeenth Plaintiff

  And
  WEE -4 INCORPORATED LAND GROUP Within the Vailala TRP
  Eighteenth Plaintiff

  V
  PAPUA NEW GUINEA FOREST AUTHORITY
  First Defendant

  And
  MICHAEL OGIO, MINISTER FOR FOREST
  Second Defendant

  And
  FRONTIER HOLDINGS LIMITED
  Third Defendant
  Waigani: Miviri J
  2019: 25th October

• Page 3 of 7

• PRACTISE & PROCEEDURE – Judicial Review & appeals – Substantive
  notice of Motion – Forestry Act 1991– Sections 73, 75, and 77 Timber Permit –
  Entitlement to Premium payments – Payment by permit holder whether
  compliance of agreements with landowner companies – Premium payments
  owing – Land owner companies deregistered – ILG paid in place of – No error
  in process – Judicial review granted.

  Cases Cited:

  Asiki v Zurenuoc , Provincial Administrator [2005] PGSC 27; SC797
  Counsel:
  A.M. Ona, for First to Sixteenth Plaintiffs
  B. Francis, for Seventeenth & Eighteenth Plaintiffs
  S. Mitige, for First & Second Defendant
  B. Frizzell, for Third Defendant

  RULING

  21st February, 2020

  1. MIVIRI, J: This is the ruling on the substantive Notice of Motion of the
  parties after mediation on the 3rd June 2015 which referred the following issues.

  (i) Whether the plaintiffs are entitled to any premium payments
  made by the third Defendant to the Landowner companies pursuant
  to Timber Permit TP 2-16 up until 2008,

  (ii) Whether premium payments made by Frontier Holdings
  Limited to the Landowner companies were in compliance with the
  agreements between the third defendant and those landowner
  companies,

  (iii) Whether the Plaintiffs are to pursue the relief sought in these
  proceedings and

  (iv) Whether they have standing to maintain the proceedings

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• (v) Whether other parties are to join in these proceedings

  2. The plaintiffs are entitled to the premium payments made by Frontier
  Holdings Limited the third defendant. They are not Landowner companies
  described by the timber permit TP 2-16 issued on the 24th June 1992 clause 4.4.5
  recounted that, “The permit holder shall pay to the Landowner companies, seven
  (7) days after each log shipment, the rate of 5% of the FOB price of logs
  exported”. But the permit has been amended so that in the absence of landowner
  companies Incorporated land Groups from that area Vailala block 2 and 3 can
  receive the landowner’s premium on behalf of the landowners. Which is consistent
  with section 46 of the Forestry Act 1991 that fully recognizes and respects the
  customary rights of the owners of the forest resources. And which is substantiated
  by section 57 as to obtaining consent of the customary owners to forest. Here it is
  settled that title of the customary owners to the subject land for forestry shall be
  vested in a land group or land group incorporated under the land Groups
  Incorporation Act 1974 or registration of title by law. Read together with the Land
  Groups Act section 3 powers of Incorporated Land Groups this is complete as to
  the management of land its use and related matters because custom is
  underpinning with a Constitution of the land Group. And clearly by section 11 of
  that law status of recognized land group as a corporation with perpetual succession
  can be sued in its name by its Constitution. It is a legal person so to pay to it what
  is due from and under the timber permit 2-16 is not wrong in law. Because the land
  groups that have signed the Forest Management Agreement have standing to
  maintain this proceeding. Here Laula Meahu, Kao Haruipi No.2, Aluce, Miaro,
  Lulu and the others who have signed this agreement parties named in this
  proceeding fall into that category. And the law discussed above allows for the
  payment of this premium benefits to them on behalf of the landowners of that
  timber permit area. They are incorporated land groups of the Timber Permit 2-16
  of Vailala block 2 and 3. They are entitled to receive a total sum of K 4, 751, 553.
  90 as Landowner premium benefit on behalf of the landowners.

  3. It is undisputed and established that leave for Judicial review was granted on
  the 6th April 2005. That mediation was on the 3rd June 2015 between the parties
  which settled all matters except for the referral above. The subject emanated from
  a timber project covered by the Forestry Act 1991. And from which the timber
  permit was granted for Vailala blocks 2 and 3 after an application was made to the
  Minister for Forests pursuant to sections 73, 75, and 77 of the Forestry Act 1991.
  Which also set out the roles and responsibilities of the parties. Timber was
  harvested from the Vailala Block 2 and 3 project area by the third defendant
  Frontier Holdings Limited. The timber permit TP 2-16 issued on the 24th June
  1992 clause 4.4.5 recounted that, “The permit holder shall pay to the Landowner
  companies, seven (7) days after each log shipment, the rate of 5% of the FOB
  price of logs exported”. The third defendant Frontier Holdings Limited was
  discharged. But disputed because an agreement was entered into with the

• Page 5 of 7

• Landowner companies on the 5th December 1998. This was without the consent of
  the resource owners and the Papua New Guinea Forestry Authority Board. It
  amended the rate of the Premium set out in the Timber Permit to K5 per cubic
  meter of the timber exported from the timber areas, Central Vailala, Popo and
  Opuma. This amount was further reduced to K3 per cubic meter. Hence the issues
  raised and referred.

  4. The mediation has settled with the independent engagement of Public
  Accountant and Auditors Leslie Wungen & Co that based upon 5% FOB value of
  the export a total sum of K 4, 751, 553.90 is the deficit that remains unpaid to the
  landowners. Using that formula it would give the figure K 9, 118, 938.35 out of
  which incorrect payment was made based on the incorrect value of K5 per cubic
  meter and K 3 per cubic meter giving the figure K 4, 364, 384.45 which was paid
  to the landowner companies. And this is set out in the affidavit of one Andrew
  Tion the company operations manager of Frontier Holdings Limited.

  5. Because what has happened in the amendment and variation has breached
  section 79 of the Forestry Act 1991. There has been no application made by the
  holder of the timber permit in this case Frontier Holdings Limited for the
  amendment or surrender of that timber permit. The process set out here under
  section 79 (1) (2) and (3) of the Forestry Act and the agreement by the landowner
  companies with the permit holder the third defendant on the 5th December 1998
  was illegal and no consequences binding in law flow from it. It means any
  premium payments calculated therefrom will not be binding in law, hence the
  figure set out above due to the landowners. On the converse by section 46
  Customary Resource Ownership the rights of the customary owners of forest
  resources shall be recognized and respected in all the transactions effecting the
  resource. And this is sealed further by section 57 also of the same Act, Obtaining
  consent of customary owners to Forest. Title to land where it is proposed to enter
  into a Forest Management Agreement over customary land which is vested in a
  land group, or land groups incorporated under the land Groups Incorporation Act.

  6. The plaintiffs are entitled to the premium payments to the sum of K 4, 751,
  553.90 as Landowner premium benefit on behalf of the landowners of Vailala
  block 2 and 3 timber permit TP 2-16. To heed the third defendant that all plaintiffs
  are not landowner companies nor are corporate entities would be parting company
  with the law and the facts and circumstances presented here. And these are pointed
  out above in sufficient detail. It is not necessary to join landowner companies that
  are no longer in existence as legal entities under the Investment promotion
  Authority register of the same maintained. Any issues emanating were no doubt
  explicitly attended to and disposed by the mediator. It need not the time of this
  court to venture there except to the issue here raised. Addressing representative
  actions are clear that here is Integrated land Groups and therefore are legal entities

• Page 6 of 7

• to be sued and sue as here.

  7. The premium payments made by Frontier Holdings Limited to the
  Landowner companies there and then were in compliance with the agreements
  between the third defendant and those landowner companies but since those
  landowner companies have been now deregistered and are no longer on the
  register of the Investment Promotion Authority, the authority for payment of all
  premium benefits is now the plaintiffs and registered landowner groups registered
  under the land Groups Incorporation Act 1974 originating from the timber permit
  TP 2-16 area of Vailala Blocks 2 and 3. The amount due is the difference
  calculated from 5% FOB and K5 per cubic meter per the agreement of the total
  sum of K 4, 751, 553.90.

  8. It follows that the plaintiffs have standing to pursue this matter because of
  the reasons set out above. It is not necessary to join any further parties to the cause
  and costs will be in the cause.

  9. It is not necessary to address separately the issue of the adjournment applied
  for by 17th and 18th Plaintiff as their interests have been settled in the way the
  facts circumstances and law has unfolded here. No prejudice has been caused to
  them. To allow would have procrastinated this cause of action outstanding since
  2004. Justice delayed is justice denied. Adjournments must be on substantial cause
  underpinning and would have the propensity to deny Justice. That is not the case
  here by the facts, circumstances and the law. Judicial review is primed on
  procedure rather than substance: Asiki v Zurenuoc , Provincial Administrator
  [2005] PGSC 27; SC797 (28 October 2005).

  10. Accordingly it is ordered that Judgement is entered in the sum of K 4, 751,
  553.90 to be paid forthwith to the principle plaintiff with the assistance of their
  lawyers Ona Lawyers for disbursement or distribution in equal parts or portion or
  share to all the incorporated land groups of Vailala Blocks 2 and 3 Forest
  Management Agreement under the Timber Permit TP 2-16.

  11. The costs will be in the cause.
  Orders Accordingly.
  __________________________________________________________________

  Ona Lawyers : Lawyer for First to Sixteenth Plaintiff/Applicant

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• Warner Shand Lawyers : Lawyer for the Third Defendants
  PNG Forest Authority : Lawyer for First & Second Defendants