The full bench of the Supreme Court handed down an important ruling in favor of the Government of Papua New Guinea in a significant case concerning distribution of electricity in Port Moresby through the Kanudi back-up Generator powered Power Plant.
The decision, delivered on 4 July, includes the government’s right to determine the material used in the generation of power, particularly through generators which are managed by private enterprise and sold to the public at large. The Regulation prohibits absolutely the importation of a petroleum product or heavy fuel oil which has sulphur content in excess of the Maximum Prescribed Standards under the Regulation. The decision is also concerned with the authority of the government to make subordinate legislation that affects rules to protect public interest to regulate prices. The proceedings in which the Supreme Court made this decision is SCM No16 of 2009 – The State v Hanjung Power Limited. The Court ordered to uphold the Appeal of the Government and made further orders that thee legal costs of the State be paid by Hanjung Power Limited. The State, through Steeles Lawyers, had commenced the Appeal proceedings in the Supreme Court. The Appeal sought to challenge the decision of the National Court made on 18 September 2009 in proceedings OS (JR) 123 of 2009 – Hanjung Power Limited v The State. In this case the Court had struck down the Customs (Prohibited Imports – Certain Petroleum Products) Regulation, 2008 (No.7 of 2008) on the grounds that the NEC failed to accord Hanjung Power Limited natural justice, failed to give reasons for its decision and made a regulation that is unreasonable and which contravened s 41 of the constitution. The Supreme Court in an extensive 105 page written ruling upheld the State’s Appeal by finding that the learned trial judge had erred in striking down a Regulation which had been properly made by parliament pursuant to a valid enabling legislation being the Customs Act, 1951. The trial judge therefore had no power to interfere with the Regulation by reviewing it. Hanjung Power Limited operates a power plant at Kanudi outside of Port Moresby which supplies around a third of the electricity used by Port Moresby residents and businesses. The heavy fuel it uses contains sulphur content in excess of the Maximum Prescribed Standards and is therefore illegal. Hanjung will now have to review its operations to ensure they are legally acceptable and comply with the established laws and framework. This decision could not have come at a better time and shows that the Government is committed to ensuring Justice is done and for the rule of law to guide its every action. It also reinforces the Governments position all along that it had indeed followed proper procedures in making the Regulation. The State was represented at the Appeal hearing by Brisbane based Barrister, Mr Levente Jurth upon instructions from Mr. Dane Mel of Steeles Lawyers. The Attorney General welcomed the ruling of the Court in what he said was a precedent for the future in a complex matter relating to price control in the national interests. Comments are closed.
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