Papua New Guinea
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Landowners to sue Chinese company

BY JACOB POK

A bankruptcy case will be filed in the National Court against a Chinese State-owned construction company for failing to pay a judgment debt worth over K7.7 million.

The China Harbour Engineering Company Limited and its PNG subsidiary have been sued by locals from the Laloki area in the Central Province who claimed that the company had trespassed on their land and caused environmental damages without proper environmental permit.

The case was filed in 2019 by lead plaintiff, Buni Morua Aloysius, for him and on behalf of 79 others who were occupants of the property contained in the State lease and described as State lease Volume 101, Folio 87, Portion 1189, at Laloki boarding Central province and Port Moresby.

The company signed a contract with the State for the maintenance and reconstruction work on the Laloki Bridge located along the boundaries of Central and Port Moresby.

It was verified that the company started work on the project without obtaining the necessary permits or license under the Environment Act 2000 and also failed to undertake appropriate enquiries and investigations as required under the Act and other applicable laws in PNG.

Instead, the company encroached and trespassed on to the subject land and used the area as a dumping or disposal site for waste materials and also established a Quarry on the subject land to extract gravel, sand and rocks for their use in the project.

The plaintiffs argued that as a result of their unlawful activities, the subject land was exposed to contamination and pollution.

Photographic images, videos and reports of the damages caused were presented to relevant State departments such as the department of Works and the Conservation and Environment Protection Authority (CEPA) and CEPA furnished a report confirming that the company had failed to obtain the relevant permits for civil works.

The plaintiffs wrote to the company to settle the damages caused but the company was reluctant and the plaintiffs took the matter further to court.

After numerous court proceedings since 2019 including court sanctioned alternate dispute resolution, the National Court on February 2023, ruled in favour of the landowners and ordered the company to pay the landowners a total of K7,733,740 in damages including interest.

The court found that the company was reckless and failed to comply with court directions and failed to co-operate in meaningful alternate dispute resolutions and have not been truthful in adducing relevant evidence.

The court therefore awarded costs against the company on an indemnity basis.

The company did not appeal the court decision and also failed to pay the judgment debt within a reasonable time frame.

The lead plaintiff Aloysius and his lawyer Nickson Kiuk of Kiuk & Associates Lawyers gave 14 days for the company to honour the judgment of the court but when consulted for payment, the company instead asked the plaintiffs to negotiate on an amount to be paid.

This did not go down well with Mr Aloysius and his lawyer Mr Kiuk who told the company that a court judgment cannot be negotiated as it was the final judgment of the court and the amount stated by the court must be paid.

In a press conference yesterday, Mr Kiuk stated that the plaintiffs will pursue insolvency case against the company for dishonouring a court judgment and failing to pay damages as per the court judgment.

“Their failure to pay the judgment debt has accumulated interests up till now which stands at over K13 million.

“If a foreign company has no regard for our laws and failing to comply with orders of the court, they might as well leave our shores and go do businesses elsewhere.

“Foreign companies must respect our laws and the processes in place. If they have no funds to pay for the damages as ordered by the court, than we are filing an insolvency case against the company to declare the company bankrupt,” Mr Kiuk said.

He said this would be a lesson to other foreign companies as well who think they can undermine our established laws and do things on their own.