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TRANSCRIPT OF PROCEEDINGS Commission of Inquiry into SABL Department of Prime Minister & NEC P O Box 782 WAIGANI. NCD Papua New Guinea

Telephone: (675) 323 7000 Facsimile : (675) 323 6478

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COMMISSION OF INQUIRY INTO SABL

MR JOHN NUMAPO         THE CHAIRMAN& CHIEF COMMISSIONER

MR ALOIS JEREWAI COMMISSIONER

MR NICHOLAS MIROU COMMISSIONER

TOP FLOOR, MURUK HAUS, WAIGANI, TUESDAY 20 SEPTEMBER 2011 AT 10.42 A.M. (Continued from Tuesday 13 September 2011)

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THE CHAIRMAN: Counsel, I understand we have got Mr Kila Pat this morning to go through his affidavit. He has produced another affidavit to submit before the Inquiry. But before we do that, as we have all agreed, where we need to commence opening the files this week. It is of the 75 SABL files that have been referred to this Commission of Inquiry. On 9 September 2011, this Commission issued an authorization, pursuant to section 14 of the Commission of Inquiry Act to divide itself up to enable its Commissioners to preside individually over the proceedings relating to this Inquiry and in so doing shall exercise all powers of the Commission of Inquiry established under the Commission of Inquiry Act. You are aware of that Counsel.

MR KETAN: Yes.

THE CHAIRMAN: The individual sitting of the Commissioners will commence this week. As I indicated earlier on, with the mentioning of each and every SABL files as part of this Terms of Reference or appended to the Terms of Reference, pardon me. As per the schedules of the hearings, each Commissioner has been allocated a number of SABL files along with a Counsel and a team of technical advisors and will commence proceedings individually on that basis. So for record purposes, I now wish to state here that following the authorization issued on 9 September 2011 under section 14 of the Commission of Inquiry Act, 1951, each Commissioners will, starting this week, be presiding individually and singularly over proceedings relating to this Inquiry commencing with the mentioning of all the files. Thank you Counsel.

Before we proceed on with Mr Kila Pat, Commissioners and I have had a brief discussion this morning and we were also of the view that the departments who have appeared before this Inquiry since the commencement should also be given the opportunity should they wish to get their legal representatives or lawyers or counsel to do submissions respectively on the affidavits and evidence they have tendered to this Inquiry since the commencement of this Inquiry and we also wish to state that probably from you and your team you might have to look at providing submission based particularly on Terms of Reference (a) and (b) of the Inquiry. But we wish to seek your view on that before we decide as to how we should proceed on that. And again, I am referring particularly to Terms of Reference (a) and (b) of the – sorry, clause (a) and (b) of the Terms of Reference.

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Also, there are, as part of the housekeeping matters, the Commissioners will also be required to – and particularly Commissioner Jerewai, so I will invite him to make a statement with respect to his involvement in some of the SABL files. Thank you. Commissioner Jerewai.

COMMISSIONER JEREWAI: Thank you. Counsel Assisting and the technical team and Chief Commissioner and brother Commissioner Mirou. Having hailed from the private legal practice sector, obviously, I have become involved with a number of SABLs in relation to which, in the course of this Inquiry, I will have to disqualify myself, and having conferred with my brother Commissioners, I will now formally for the record, declare that I disqualify myself from being involved in the Inquiry into three SABLs and the first one of which is the one described as – if Counsel can assist me in this, Portion 146, is it? Marienberg, Angoram, East Sepik Province.

MR KETAN: Yes. Brilliant Investment.

[10.47 am] COMMISSIONER JEREWAI: That is the one. Title to which is held by Brilliant Investment Limited. Is that correct, portion 14 ---

MR KETAN: Sorry, Commissioner, it is ---

COMMISSIONER JEREWAI: Just a moment, we will shortly be having the correct portion mentioned.

MR KETAN: Commissioners, it is number 53 of the SABLs that have been appended to the Terms of Reference.

COMMISSIONER MIROU: Is that 53 on the ---

MR KETAN: 53 on the ---

COMMISSIONER MIROU: Advertised ---

MR KETAN: Yes.

COMMISSIONER MIROU: List in the Papers?

THE CHAIRMAN: How about the portion?

COMMISSIONER JEREWAI: I just want to get the exact description, sorry, Counsel. I will have it shortly. It is portion 146, so I was correct; 146C, Milinch Angoram and Marienberg, Fourmil Bogia and Vanimo, East Sepik

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Province. I disqualify myself on the basis that I am part of the landowning clan whose land is comprised partially in that SABL. So that is the first one that I disqualify myself from. The second one or the remaining two in relation to which I want to also disqualify myself from dealing with in this Inquiry are two in the Central Province described as portion 29C held by Baina Agro-Forestry Limited. It is described as portion 29C, Milinch Okase, Fourmil Buna, Central Province and the title is held by Baina Agro-Forest Limited. And the other one is Umu Resources Limited who holds title to portion 30C, Milinch Okase, Fourmil Buna, Central Province. They lie adjacent to each other in Kairuku, well, Kairuku, Woitape Districts of Central Province. Those are the three SABLs I disqualify myself from. The latter two, because I have had involvement as Counsel in one manner or another and therefore, I will not be dealing with those. Those are left to my brother Commissioners to deal with. Thank you, Counsels.

[10.52 am] COMMISSIONER MIROU: If Chief Commissioner and brother Commissioner will also allow. I would also like to put on record that I have no connection whatsoever to any of the matters that have been listed and so I make no disqualification in this regard.

THE CHAIRMAN: Counsel, I will say the same as what Commissioner Mirou has said. I have no interest or no connections to any of these SABLs appended to the Terms of Reference and for that reason I will not disqualify myself from any one of those SABLs. Thank you.

MR KETAN: Thank you. On our part, Commissioners, while we are on that, for myself, I have not had or do not have any conflict in relation to any of these 75 listed as SABLs, from information and known personally to myself and information available at the moment. I have not had any reports or indications by any of the other members of our team, except Mr Bokomi, Jimmy Bokomi. He has had direct involvement as Counsel and acting for people with competing interest in relation to matters listed number 64, 65, 66, 67, 68 and 69 and 70 on the list, which are SABLs held by Pulie Anu Plantation in West New Britain. All of these are in West New Britain; Rera Holdings Limited, Akivru Limited, Ivaga Ourouino-musenamta Limited, Polopo Limited, Kavun Limited and Gororanto Limited. So he, Mr Bokomi, will not be dealing with that matter and in the way we have arranged the circuit schedules and that he will not be posted to the areas. Those files are handled by other members of our team and he will not have any dealings with those.

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THE CHAIRMAN: All right, Counsel, the tentative schedule that we are working on, I see that those declarations that have been made by the Commissioners and yourself, and obviously by one of your team member, I think it has been reflected that they are not sitting directly on those SABLs. So that should also be reflected in the final schedule of hearing, the schedule is going to come out so we do not have any issues when we go out to the provinces.

[10.57 am] MR KETAN: Yes, we will note that. In relation to the invitation to Counsel for the main and relevant Government agencies, such as the Lands Department and the PNG Forest Authority Department and Environment and Conservation and Department of Agriculture and Livestock, at this stage, we are – we begin the opening of the files and I am just not sure how we can fit them in the opening of the files scheduled for tomorrow.

THE CHAIRMAN: Counsel, let me clarify this. We just discussed this actually this morning before we came on and we think that it should be fair if we give them the opportunity, if they so wish, over and above the affidavits and evidence that each of the officers of the Department have given, that if their legal team would want to provide to us a submission to basically to round up, cover up all the evidence that their respective Department has given to date and that is fine. They can either do it in writing or they can appear here and do it orally because it will be on record. So that is a matter that you can flag with the respective Government Departments and see how they respond to that. If they think that what has been submitted is sufficient, then that is fine. But we are giving them that opportunity just in case there are few other points they wish to further clarify or reaffirm or whatever, then this would be an opportunity. Now as far as time factor is concerned, we are mindful of the fact that after the opening of the files, the Commission will now go out to the provinces on circuit to get evidence. We are not saying that we want to see that happening next week. Obviously, we have got to give time to those respective Departments to put things together. So that can be done after we come back from the provinces. And I see on the tentative schedules there are some opportunities there – window of opportunities for the Counsels to come back and do that if they so wish. But that is something that we are proposing to you to put to those Departments so that we give them the opportunity as well to sum it up, all the evidence that has been given to the Inquiry to date from the respective government agencies.

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MR KETAN: Yes.

COMMISSIONER JEREWAI: And if I may add. This is in regard to Terms of Reference (a) and (b), which as we have done so far, inquired into the legal basis of issuance of Special Agriculture and Business Leases and the administrative and policy processes that were followed in the issuance of these leases and the submissions being invited or that are being suggested to be invited should cover those aspects only. Much of the evidence in the affidavit standard so far may go to some degree to the substantive files individually. They need not address us on that. Because the Commission of Inquiry in its preliminary work plan had proposed that, as we conclude, relative Terms of References in the order that they are set out in the Terms of References published, we need to provide interim findings and reports and recommendations. And perhaps not recommendations but at least findings and the report thereon and those segments should be dealt with at that point and put away as we progress into the individual substantives. That is basically where we are coming from with regards to these submissions.

MR KETAN: Yes, very well.

COMMISSIONER JEREWAI: Once again the submissions, I think Chief Commissioner Numapo meant to mention is they need not be in writing and they can be oral because the law that we are all looking at involves only a number of sections in the Land Act itself, the other related Acts, such as the Land Registration Act, and with regards to Forest Clearance Authorities, Forest Act or yes Forestry Act, Agriculture, there may be relevant legislations, although none had been mentioned so far in the course of the Inquiry, but the Department of Environment and Conservation, definitely. The Environment Act comes into focus.

[11.02 am] So at this point, they need to be invited to address on these issues. Along the way I should also mention that you might consider whether it is appropriate to invite the State Solicitor from the Department of Justice and Attorney General to address on that because that is the department that is the primary source of legal advice for the Independent State of Papua New Guinea. So I think it is important that they also be invited on this aspect. So if we can restrict the submissions at this point with regard to Terms of Reference (a) and (b) only to matters of law, the legal bases, and the administrative and policy guidelines by which or pursuant to which these leases have been issued thus far. That will put that leg, at least, of the Inquiry out of the way. Now, as to the timing, as Chief

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Commissioner Numapo stated, you do not have to look at the – in the immediate future. There are some windows of opportunity as far as timing is concerned in between the individual circuits that we will be conducting and you can suggest on times to us. MR KETAN: Yes, very well. COMMISSIONER JEREWAI: Thank you. MR KETAN: We will take note of that, yes. THE CHAIRMAN: Okay, you wish to now continue with Mr Kila Pat? MR KETAN: Yes. THE CHAIRMAN: Apart from all these in-house? MR KETAN: Yes, I call Mr Kila Pat. ROMILY KILA PAT, (continuing) XN: MR KETAN THE CHAIRMAN: Counsel, Mr Kila Pat is still on oath. MR KETAN: Yes. Commissioners, Mr Kila Pat returns to continue to give evidence in relation to from where he left off. He took us through his affidavit of 13 September and he was to return on Monday for examination on that and also to give evidence. He was given an opportunity to give evidence in relation to the evidence of the Chief Secretary, Mr Manasupe. In relation to that, Mr Kila Pat has sworn an affidavit of 19 September 2011. As we did not – the Commission did not sit on that day, we accepted the affidavits and copies of those were informally accepted and copies of which were given to the Commissioners. We will deal with that affidavit after, perhaps, dealing with the first affidavit of 13 September 2011. The other second affidavit is yet to be formally tendered.

[11.07a.m] COMMISSIONER JEREWAI: Counsel, perhaps now that you have mentioned the second affidavit, it may be a speedier process if you can have him tender the second affidavit and we go into examination on both affidavits.

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MR KETAN: Yes, very well. Mr Kila Pat, you have a copy of your affidavit of the 19th of?

A: Yes, I do.

Q: If you can just, as you did on previous occasion, just hold it up and indicate to the Commissioner as to where your signature is.

A: Commissioners, my signature is towards the right hand side corner.

Q: Do you agree with the contents of the affidavit?

A: I do Counsel. But before I proceed with the affidavit, there is just one or two minor errors that I would like to correct before we---

Q: Yes.

A: So that is on page three, number four. The third line which reads – it should read, which, I will read it now; “In the SABL process that I have provided to the Inquiry, I did not refer to the issuance of Certificate of Alienability which the Custodian of Trust Land”, it should read; “Trust Land”, instead of “State Land”.

Q: Yes.

A: The next one is still on the same page three. It is number seven. It reads; “Land in Papua New Guinea is acquired either outright or for lease whereby section 10(1) provides for the outright purchase of land by agreement and section 10”, it should be “subsection (4)” and not “(2)”.

Q: Yes.

A: Okay, the last one, Counsel, is on page 6, 21. On the four sentence I said, “However, I cannot”. It should be, “I cannot”, not “can’t”. It should be, “I cannot confirm.”

Q: Yes.

A: And the last one is on 22. The second last line which says; “However, for SABLs, the Department is of the view that”, it should be “C-O-A”, and not “C-A-O”. It should read, “C-O-A”. Thank you Counsel, that is the only corrections that I just wanted to make before we proceed with the affidavit.

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Q: Yes. Otherwise, you are happy with the contents of the affidavit?

A: That is correct, Counsel.

Q: Would you have any objections if I tender it?

A: No objections Counsel.

Q: Commissioners, I seek to tender that. Just by way of formal understanding of the original, which is the Commissioner file copy, you are have been given the copies informally. If that can be marked? It should be exhibit RKP15.

[11.12a.m] [EXHIBIT RKP15 TENDERED – AFFIDAVIT OF MR ROMILLY KILA PAT OF 19 SEPTEMBER 2011]

MR KETAN: Mr Kila Pat, as we did on previous occasions on the previous occasions, if you can just very quickly take us through that affidavit and then once you are finished, we can deal with both in terms of questions that we might have.

A: Thank you Counsel, Chief Commissioner and Commissioners. On the 19th day of September 2011, I, Romilly Kila Pat, Deputy Secretary, Customary Lands with the Department of Lands and Physical Planning of P O Box 5665 Boroko in the National Capital District make Oath and say as follows;

(1) I am the Deputy Secretary, Customary Lands and I have perused the affidavit of the Chief Secretary of the Government who is also currently the Custodian of Trust Land.

(2) I confirm that Mr Zurenuoc was appointed Custodian of Trust Land on 12 February 2009 and whereby it has always been the practice to appoint the Head of the Department of Provincial and Local Government Affairs to be the Custodian of Trust Land.

(3) On 16 August 2011, I deposed to an affidavit when I was Acting

Secretary of the Department of Lands and Physical Planning on processes and procedures administered by the Department on the issuance of the Special Agriculture Business Lease to customary landowners.

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(4) In the SABL or Special Agriculture Business Lease process that I provided to the Inquiry, I did not refer to the issuance of Certificate of Alienability, which the Custodian of Trust Land has stipulated in his affidavit from paragraphs 13 and 18 to 24 as this is a process that the Department has stopped administering.

I bring you to the issue of Certificate of Alienability.

(5) Under the Land Act 1996, it provides under section 7 the modes of acquisition whereby section 7(a) provides for acquisition by agreement and section 7(b) provides for compulsory acquisition.

(6) All land except land acquired under section 11 and 102 of the Land Act are acquired for public purpose whereby public purpose is as defined under the Land Act under section 2 “Interpretation”.

(7) Land in Papua New Guinea is acquired either outright or for lease,

whereby section 10(1) provides for the outright purchase of land by agreement, section 10(2) provides for lease of customary land, section 11 and 102 provides for Special Agriculture Business Lease and section 12 provides for the different types of acquiring land outright.

(8) For all modes of acquisition, the administrative procedure whether

conducted by the Department of Native Affairs or the Department of Lands and Physical Planning was to conduct a land investigation to determine the landowners, the name, location, type of land, obtain landowners consent and determine the land area of the subject land.

[11.17 am] (9) After conducting a land investigation, the land investigation report often referred to as LIR was compiled where the provincial or district administrator recommends for the alienability of customary land.

(10)About 10 years ago the Department of Lands and Physical Planning made an administrative decision to cease requesting Certificates of Alienability from the head of the Provincial and Local Level Government Department for the issuance of SABLs as the Department of Lands and Physical Planning was of the view that for a SABL, a Certificate of Alienability was not required.

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(11)The reason being that a SABL is a different type of State lease from other State leases as provided in the Act. Customary land acquired for the purposes of SABL are not alienated in perpetuity. Customary land is only leased to the State for the issuance of State leases to be leased back to the customary landowners for a period of no less than 99 years as provided under section 11(1) and (2) and section 102(4) of the Land Act 1996.

(12)Section 10 provides that all land acquired by agreement must be acquired in accordance with section 10 whereby a reasonable inquiry must be done to confirm that the subject land is not required by landowners. This provision provides for alienability test for customary landowners where, in the Minister’s opinion, the land is required in the future, he will only lease the customary land pursuant to section 10(4). Section 10, however is subject to section 11 whereby the Department’s view is that a SABL is issued at the request of the landowners, the Minister’s inquiry is not as diligent as is required in section 10.

(13) The department’s view is that the vested interest of land acquired, other than for SABL vests in the State whereas a SABL the interest in the land is vested in customary landowners.

(14) A SABL is not land acquired for public purpose as defined under section 2 of the Land Act 1996 nor is it acquired for the direct benefit of the State. It is acquired for landowners for their direct economic benefit and the preservation of ownership rights for future generations as before the amendment to the Land Registration Act 1981 and the Land Group Incorporation Act 1974. There was no provisions for registering customary land other than by the Land Tenure Conversion Act 1963.

(15) Based on the above reasoning, the Department is of the view that the recommendation of alienability provided by the Provincial or District Administrator in the Land Investigation Report is sufficient evidence that the subject land can be alienated for the purposes of SABL.

(16) The Department is currently reviewing the Land Investigation Report compiled for lands investigations to differentiate the different modes of acquisition whereby the terms will be reviewed and revised so that

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it is simplified for even the customary landowners to understand. And further, where customary landowners sue each other in court over the issuance of a SABL or an issue of ownership, there will be less ambiguity.

The next aspect refers to the Custody of Trust Land.

(17) Section 167 of the Land Registration Act 1981 does provide for the appointment of the Custodian of Trust Land whereby section 166(3) of the Land Registration Act 1981 and section 134 of the Land Act 1996 provides for the Custodian duties.

(18) Section 166(3)(b) of the Land Registration Act provides for the Custodian to take, purchase, hold, sell, lease or otherwise deal with estates or interest in the land with the written consent of the Minister.

[11.22] (19) Section 134 provides for the protection of interest of customary land whereby section 134(a) provides for the Custodian to take action as he deems necessary or desirable and section 134(b) provides for the Custodian to take such action as is ordered by the National Court or the Land Titles Commission to establish or further protect the interest of customary landowners.

(20) These above provisions do provide for the duties of the Custodian of Trust Land and where although the Custodian of the Trust Land is provided with powers under the Land Act and Land Registration Act, he is not required by law to issue a Certificate of Alienability for the purposes of acquisition as provided under section 7 of the Land Act.

(21) The requesting of an issuance of the COA has been an administrative procedure used by both the Department of Lands and Physical Planning and previously the Department of Native Affairs. However, I cannot confirm whether it was used prior to Independence or not, but I am of the opinion that it must have been used by the pre-independence Government.

(22) The Department still agrees with the issuance of COA, Certificate of Alienability, for the outright purchase or lease of customary land and it still requests for COA for these two processes and land is to be either purchased outright or to be leased by the State for purposes of State. However for SABLs, the Department is of the view that COA

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is not required, and has further stopped requesting the issuances of COAs.

(23) To give an insight to the Inquiry on the purposes of the SABL, annexed hereto and marked “A” is an undated research paper prepared by CEP Val Haynes, a lecturer who taught land law courses at the University of Papua New Guinea from 1980-1984. Mr Haynes also wrote work flow programs for the Department in 1993 for the development and testing of the previous PNG LIS or PNG Land Information System transaction processing capability. This paper was prepared for the Department on the Lease – Lease back processes and also was part of the review of the Land Act (chapter 185) prior to Land Act 1996 and I am attaching this to help the Inquiry with some important questions and answers that may have not been raised as yet.

Alleged Issuance of Special Agriculture and Business Lease.

(24) In reference to paragraph 25 to 36 of Mr Zurenuoc’s affidavit, I do acknowledge the allegations made against the Department in relation to the issuance of SABLs as stipulated in the affidavit, however at this point in time, I cannot comment as my Customary Lands Division is conducting an internal investigation to verify the allegations that have been raised and I intend to provide an official position on them in the near future.

Thank you Chief Commissioner, Commissioners and Counsel Assisting.

Q: Thank you Mr. Kila Pat. If I can refer you, Mr Kila Pat, to your first affidavit of 13 September.

A: Yes.

Q: At paragraph 3 of your affidavit, you state that you are unable to find some of the files that you were summoned to find, being the balance of the files that you were required to produce. If you can explain as to what you mean, whether those files have been lost or stolen or misplaced or why can you not find the files?

A: Thank you Counsel. I would not say that they have been stolen; I would say that they may have been misplaced in the system. I did earlier on in my previous appearance did mention that our filing system is chaotic,

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given our current situation in the Department, although we are making every effort to keep our files. Also I did raise the issue of previously under the old structure, we had only a manager who was responsible for the entire Customary Land in the country and he was under staffed. Apparently he is deceased and a lot of things that he has worked on are things that we are now working to reconstruct files. I note also from your letters to me that there are some files that are incomplete and I have been advised by my Directors that hopefully by the end of this week, we should be able to fully reconstruct all those files and have them delivered to you.

Q: Not by the end of the week?

A: Yes.

Q: Yes, thank you. Paragraph 5, if I can refer you to paragraph 5, you deposed to the Customary Lease Unit not having its own registry, as a result of which the files are kept in the respective managers’ office and work stations. We have had evidence from officers of your department, including the Registrar of Titles, about the filing room or down on the basement of the building. Is that not where all the files should be kept?

[11.27 am]A: Thank you, Counsel, not necessarily. Actually, when we moved into the department from Morauta Haus, the department had no areas for file storages and all that. We were given a very tight situation so we had to negotiate with the owners of the building to convert the basement which was never entered for a file storage area to convert it so that we can keep our files there. Had we kept them up where we are, then you would not see anybody in the office. So basically that is what happened. We have done all we could. Also, under the old arrangement, the Customary Land Division was not as it is now. It was under one land administration, so all the files were kind of kept in one place. But now that we are in the – we have a new division, we are now retrieving all the files out and trying to keep them all in one place so we have a separate registry that keeps customary land files separate from State leases.

Q: Yes. So, where is that? That is on which floor of the--- A: On the second floor currently. Q: The files in relation to paragraph – what you depose to in paragraph 6 – the

files that were not filed away with the – you state that they may have been

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misplaced. Are you able to allocate someone, one of your officers to look for the files; just physically look for the files in your offices?

A: Counsel, we have actually raised it from staff alone to – currently, I have

two directors, given the importance of this Inquiry and the importance of keeping files secured by two directors are co-working together. So that is Director Acquisition and Director Customary Leases are working together to physically check through. So they have been, I must say, working on the weekends as well working through trying to make sure that all the files are retrieved. We have given instructions also internally for staff who are holding on to files, if any customary land files are on their desks, they should make them available to the two directors immediately. So that is ongoing at the moment.

Q: Yes. See, in paragraph 8 of your affidavit, you state that – as you have

mentioned just a while ago – the Customary Leases Division has decided to keep files within your offices now. If that is the case, then it should be easy to locate the files. Would that not be the case?

A: That would be true, Counsel. But in the meantime, we are going through

everywhere where the files have been kept to retrieve customary files. So eventually, once we have all of them up in one of the two directors’ offices, then they will be secured for the time being until we move onto the new office.

Q: Yes.

[11.32] COMMISSIONER JEREWAI: Counsel, If I can just follow on from your question while you are on that line.

MR KETAN: Yes.

COMMISSIONER JEREWAI: Mr Kila Pat, I have raised this with Mr Henry Wasa, the Registrar of Titles when he last appeared and I want to raise it with you. Do you not have a file circulation arrangements similar to a library borrowing system where you have a card where any officer, or anyone else for that matter who wants to access the file, enters the time and date and his name and the official position in the Department or if any other organization and lodge it with a officer who should be assigned to be responsible for controlling such circulation so that you know exactly where the files are when once they leave their place of storage?

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A: Thank you Commissioner. In the current system, we have a manual system where, in each of the file there is a sheet that is put in the file so whenever the file is taken out, the names are entered, and dates and all that is written and all that and that is kept in the file so every time – that is in the State files - every time somebody gets the file they enter onto the - that they have got the files and all that. But it is something that we really need to work on. With the current system we are developing, it is going to fully capture all that because it is all done electronically because we still find that people can still tamper with that recording system. So we do have it but like I said it is not really something that we could really rely on because people can tamper with files and all that.

Q: My inquiry in relation to that kind of system is to really zero in so that the appointed – duly appointed or assigned official of your Department should be solely answerable to the whereabouts of the file; any files within your Department?

A: Commissioner, I quite agree with the views that you are expressing. We do have a records management unit in the Department which is headed by a Manager. The only problem is that our files are not kept in one location; they are kept in different locations so the idea behind this Record Management Unit is for them to actually sit in an area where when people get files, they check that they go out and come back but currently, given our current situation, it is almost difficult to manage that process.

Q: If you have three or four locations, obviously you would require three or four different control clerks or control managers. And it is very imperative is it not, particularly with regards to titles? Perhaps not so much in relation to your general files but particularly with regards to titles, whether the question of indefeasibility of titles rests alone in the records kept by the Registrar of Titles, and to compromise their security is to compromise ownership virtually of all State Titles or any other titles throughout the nation. That should be of paramount importance and concern to ensure that the system is put in place to sufficiently ensure that security of the question of indefeasibility of titles.

A: I do agree Counsel, that is important and that is also one of the impact projects for us to deliver to Government come October this year to say that

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we can almost guarantee the security of these titles. So it is something we are working on. Thank you.

Q: Thank you Mr Kila Pat. But I do note in paragraph 4 of your affidavit that, and you have indicated a minute ago, that you are doing all that is within your ability to assist this Commission of Inquiry to produce the remaining files that you have been unable to produce.

A: Correct.

[11.37 am]Q: Thank you. And I also want to restate the position here that this Commission of Inquiry will not be able to conclude its task in relation to the whole of this Special Agriculture Business Leases unless if all of the records of the department, particularly of Lands and Physical Planning, which is your Department, are produced so that we are able to make some sense of the Inquiry in to every individual SABLs.

A: Thank you Commissioner. I stand to be corrected on this one but I believe the Titles officers completed, submitted all the titles that is required for the Inquiry. For the Lands files we have 11 files that are outstanding. We note also from Counsel that there are some documents that are not in the file and this morning - we have been working over the weekend actually and up till yesterday, I have been advised by my directors that we should have those files completed and submit the 11 files. So that should conclude the 75 files by Friday this week, yes.

Q: Thank you, Mr Kila Pat. And once again, for the record, I restate that titles alone, merely establishes the titleholder’s position. The imperatives of this Commission of Inquiry is to determine among all these other matters including title, also the processes leading towards the issue of titles. That is why it is very imperative that we look into your files where activities have taken place leading to the issue of titles.

A: That is correct, yes.

MR KETAN: Thank you. In paragraph 9, the decision to – the system that you have just referred in response to one of the questions is that, is that the LAGIS system that we have heard about during the evidence?

A: Counsel, we, the department over the years has had - initially it was called PNG Land Information System, PNGLIS, then it got migrated onto

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LAGIS, which is Land and Geographic Information System and now it is called a LEAP project, it is Lands Enhancement Land Applications Program. So the current project is called the LEAP project, L-E-A-P project. This, what we believe - strongly believe that this system that we are working on is going to address all the issues both within State land, customary land and everything; all the problems that the department is facing now with records keeping and titling, everything is going to be - it is going to be a one stop shop. It will be sorted out by this system. We believe very, very strongly and that we have got evidences to prove that this system has worked in some of the - particularly in Queensland and in Northern Territory with native land dealings and all that, it has worked perfectly well and we have really confirmed that. So we believe strongly that this is the answer to all our problems.

Q: So, is that the one covering the contract that you have entered into with Technology One?

A: That is correct, yes.

Q: And the decision was in 2005, that is like six years ago?

A: That is correct, yes.

Q: When was this decision to change the system made?

A: It was ---

[11.42 am]Q: We have heard about the LAGIS system, and I stand to be corrected, but from evidence from other officers of your Department and particularly Mr Wasa, we have been hearing about the LAGIS system. Now, today and through your affidavit, you are saying the department has entered into yet another system?

A: No, I will correct that one. The LAGIS system is currently being used.

That is the one that we are currently using. The project is the one that we are working on that will replace the LAGIS system, and that is the one that the first phase has been uploaded and as we are speaking now, the user testing is being undertaken at the moment – user-acceptance testing, sorry, so that by the time we go live at the end of the year on phase one, then we will not have any problems on it. So when you look at the LAGIS system, it is not very compatible. It does not – for example, I believe, whilst we were outside of the room, you had an opportunity to look at the power point presentation on the system that was provided. That is basically

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where we are heading to, to have all that captured in the system so you do not have to have problems with identifying land and all that, it can be easily – but though there are different phases that we are going through but stage one is the very critical one that we need to get. For example, we are talking about the processes in SABL, those kinds of things need to be captured into the system so it is all locked in and nobody goes outside of that to do anything. You just have to go by that process.

Q: Yes. Does that take into account the file recordings and title recordings as

well? A: All dealings in land; both alienated and customary land. It starts from the

initial process of investigations to the actual ending of the title being printed through the system.

Q: Yes, very well. I have no further questions on this affidavit. THE CHAIRMAN: Okay, Counsel, thanks. I have got one or two questions to ask Mr Kila Pat in relation to this affidavit. Mr Kila Pat, can I refer you to paragraph 10 of your affidavit in which you – that is the, yes, the recent one that you have just given; the one you just read out a few minutes ago? In paragraph 10 of your affidavit, you said that at “about 10 years ago, your department made an administrative decision to cease requesting Certificates of Alienability – COA – from the head of the provincial and local level government for issuance of SABLs as the Department of Lands and Physical Planning was of the view that for SABLs, a Certificate of Alienability was not required.” That is what you said. Is there a legal basis for your department to come up with that decision to state that it is an – to make that administrative decision? A: Chief Commissioner, what – it was because we find that in terms of

Certificate of Alienability, it is not specified in law that it is required. We only – it was only used especially when acquisitions were done; compulsory acquisitions by way of purchase or the State leasing land from the landowners. So it only applied in those instances. You will note also, I stated that with the compulsory acquisition or outright purchase and State leasing land from the landowners, that is when landowners lose their rights totally. It is in perpetuity; it does not remain to them. Whereas as against SABL, the land is still vested in customary landowners; they still hold interest in that land. So when we looked at Certificate of Alienability, it was mainly reading towards acquiring the landowner’s interest right away from them. In this instance where SABL is involved, it does not alienate customary land interest. So that certificate was basically, we said, it did not really apply in this instance. It could only apply in those other two.

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COMMISSIONER JEREWAI: Sorry, following from the Chief Commissioner’s question, your answer just now, was there any written legal opinion provided in relation to that administrative determination that Certificates of Alienability was not required in relation to SABLs? A: Commissioner, that was done at the time of--- Q: Prior to your time? A: Yes, it was done by Secretary Kimas and the late Ian Kundin provided

advice on that to the Secretary at that the time and a decision was made.

[11.47 am]Q: Can we, just state it if it is possible when and should you decide to make submissions through your lawyer, you may be able to bring in that legal advice. It will assist the Commission of Inquiry, particularly with regard to the determination of the legal basis – Terms of Reference - legal basis upon which SABLs are to be issued and with regard to the question of alienability – Certificate of Alienability?

A: Okay, Commissioner, I note that. Thank you. THE CHAIRMAN: Following on from there, when that decision – when that administrative decision was made, that COA is no longer necessary for SABLs, has the decision been conveyed to the Custodian of the Trust Land or for that matter, the Department of Provincial and Local Level Government? A: Chief Commissioner, I cannot really confirm that but I can when – once

provided the response on the previous question that was answered by the Commissioner, I can also confirm that as well if there was – but I am of the view that there was some communication done but I cannot really confirm that, Chief Commissioner.

Q: May be you want to take note of paragraph 21 of Mr Zurenuoc’s affidavit

in which he made reference to those administrative procedures for alienating customary land. He made references to a number of different provisions of both the Land Registration Act and the Land Act which he stated that vested the Custodian of the Trust Land, the responsibility to protect interest of customary lands; and I want to think that those were probably the basis upon which he says that the Custodian of Trust Land therefore must issue the COA before any land is taken or acquired. I am just raising this, if at some stage, at some later stage when you have decided that your Counsel should make a submission to sum up everything

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that he or she should take that into consideration because they are two separate views here; the Custodian of the Trust Land is saying that it is a legal requirement, whereas you are now stating in your affidavit that it is an administrative decision made by your department some 10 years ago to do away with the requirement of a COA to be issued. So obviously, there are two different views, conflicting views on that particular aspect. The other question I want to ask you is in relation to paragraph 21 of your affidavit, which you say that – and again, it is probably relating to the same thing – that it is an administrative procedure used by your department and the Department of the then Native Affairs which is now the Department of Provincial and Local Government; that it is an administrative – somewhat an administrative arrangement for the COA to be issued. I was just wondering whether or not your department would be able to produce to this Inquiry copies of those administrative guidelines or procedures in relation to the issuance of the COA by the Custodian of Trust Land, because what you are saying in your affidavit is that it is not a legal requirement. It is through some administrative arrangements or through some administrative procedures that COAs are issued. So to assist us, we want to understand this as to what process triggers or allows for the issuance of the COA. So it will be very helpful to the Commission if you are able to provide or produce to this Inquiry the administrative guidelines or procedures that you are referring to in your affidavit – paragraph 21 of your affidavit.

[11.52 am]A: Thank you, Chief Commissioner. I think I did mention that the COA -

we only request COA when it comes to customary land rights totally alienated from them. That is only the instance when we – because that is how we read Certificate of Alienability where it totally alienates landowner interest, and that is where the Custodian of Trust Land comes in to ensure that landowners are not discriminated in any way, shape or form by way of ensuring that if the land is purchased outright, they get a fair compensation for that or if land is leased. Lease, we – it is specifically land lease is in relation to prior to Independence and right after Independence, there was a need for government to quickly establish things like health centres, primary schools on customary land. During those arrangements, there was no proper acquisitions done, so the State went ahead and leased land. So every year, the Department of Lands pays annual lease rentals to those lands. Basically in that instance, the land is taken away from the landowners. So it is only on those two arrangements that we saw that Certificate of Alienability applied. But in the issuance of SABL, it does not because the land is issued to customary landowners and continues to maintain its status as customary land right throughout, not only 99 years but in perpetuity. But I do take note of your views that you

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have expressed that you need some documents to prove why we do not issue COAs on this aspect of land. So that is something that we need to provide for the purpose of the Inquiry.

Q: I think the important thing, Mr Kila Pat, is that if that message or

information had been provided to the Custodian of Trust Land and there is some understanding between his department and your department that it is really not necessary for the Custodian of Land to issue the COA; that it can be done without that. I am looking at the two affidavits and it is totally different to what the position that Mr Zurenuoc has taken in his current position as the Custodian of Trust Land, that he is of the very strong opinion or view that it is a legal requirement that without the COA, no SABL should be issued. I think he made it very, very clear to the Inquiry that many of those SABLs that have been issued have not come past his office and he only listed about a few of them that have come past his office and he has issued a COA on that. So there is a conflicting situation between his department as Custodian of Trust Land and obviously yours, Department of Lands and Physical Planning. Thank you.

COMMISSIONER JEREWAI: Mr Kila Pat, what you are in effect saying is that you consider alienability of customary land to be complete if land is totally alienated from the customary owners? A: That is correct. Q: The position your department had taken is that SABLs are not land that is

totally alienated from the customary landowners, and therefore, you consider that Certificate of Alienability is not necessary?

A: That is correct, yes. Q: In the issuing of the SABLs? A: That is correct. Q: That is not withstanding, if the law as it is, says that customary land,

more or less by either definition or by specific provisions considered to be held in trust by the Custodian appointed under section 167 of the Land Registration Act?

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A: Unless it is – Commissioner, unless in my view – this is my view, that it is specifically mentioned that it is vested in the Custodian of Trust Land, then of course we might agree that, yes, he should be issuing COAs.

[11.57 am] But it is our firm view that SABLs maintain their status as customary

land prior to doing the lease of that land for 99 years and thereafter. So we do not think that that is total alienation of their interest because they continue to hold titles to their land.

Q: I am looking at section 134 of the Land Act which you have referred to in your affidavit, the affidavit of 19 September which says that, “In connection with any proceedings, matter or thing under this Act, it is the duty of the Custodian for Trust Land to take such action:

(a) as seems to him necessary or desirable; or

(b) as is ordered by the National Court or the Land Titles Commission

to establish further or protect the interest of customary landowners.”

Those action, would you say, is relative to complete alienation as opposed to temporary alienation as you have just described a moment ago?

A: I would think so, yes. Q: Nonetheless, Mr Kila Pat, it is really a matter that will be open to

submissions? A: Yes. Q: By your lawyers at a later stage--- A: Yes. Q: As you have already indicated, we should invite. COMMISSIONER MIROU: Might I just take you back to your evidence of the 16th? As you said, there was no section 10 and section 11 and 102 of the Land Act does not specifically provide for processes for the processing and issuance of SABLs, and therefore, your department has used the processes involved in compulsory acquisition, thus the reasons that you have now provided that COA is not required when you are looking at SABLs. Would that be the correct

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position that the department has taken as to why COAs are not required for SABLs? A: We - actually, Commissioner, we are looking at it strictly from the point

of what I have been stressing, the vested interest in terms of ownership of land. We strongly believe that SABL – the interest in SABL continues to remain with the landowners for prior to during the period of that lease and thereafter for in perpetuity. Our argument is the fact that it is when landowners are totally alienated from the land, they will have no say whatsoever and that is where the concern of Certificate of Alienability comes into play where the Custodian of Trust Land ensures that if the land is going to be purchased outright, that landowners are given a fair and just compensation for the loss of their rights to their land. The same applies with land that is leased from them where we have government establishments on it. But in terms of lease-lease back, we are standing that the land does not change its status quo. It continues to be customary land; and therefore with Certificate of Alienability, it has been viewed all this time that a certificate basically gives rise to total alienation from landowners and so it is not necessary to be used in SABL. That is---

Q: Because I raised this point because in your affidavit and it was submitted into evidence that particular document is a recommendation as to alienability is also attached to the Land Investigation Report. That is a recommendation from the provincial administrator, who in the end would – the end process after the recommendation comes to your department would now be able to confirm that recommendation, would be an independent person actually to look at that type of report?

A: Not necessarily an independent person. Normally, when the documents

are cleared from the province, they come directly to the – either the – if it is for the purpose of acquisition, outright acquisition and it comes to the Director Acquisitions; if it has to come – if it is in relation to customary leases and all that, it goes to the Director Customary Leases for them to vet to ensure that all the requirements are in order before we process whatever it may be for.

[12.02 pm]Q: Mr Kila Pat, it also comes back to the provisions under the Land

Registration Act where you have the Registrar of Titles also, his office is being created by the Land Registration Act including that of the Custodian of Trust Land which includes – would that be the authority or the next person that in the process that you would make ---

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A: Normally, the Office of the Registrar, his role comes into play when he registers the lease and has it issued. In terms of the Custodian, we only go back to the Custodian when we are satisfied that the LIRs are all in the - Land Investigation Reports are all in order and the land is required for a public purpose, then the documents are referred back to the Custodian of Trust Land to have a look at and issue a Certificate of Alienability. That is only when land is required for a public purpose. But in terms of SABL, it is not a public purpose, it is for the purpose of the landowners. I did mention in my earlier, the first time when I appeared, that the SABL, given the current legal framework that we have, we do not have a law that talks about customary lease. Recently it has been passed and we are looking at how we can issue customary leases. So all these time all along we have been using SABL, primarily for two purposes; one, it has been an issue over the years that landowners do not have security to their land. So SABL was kind of used in that context to get landowners to register their land and secure it in the event that they may use it for their own purpose or if they so do wish, like now, SABL they are now going into large agriculture and forestry projects. So it has a dual impact, if you like, on landowners. One, if they want to get into economic development, then they have a title they can you know, it is their will. We do not have to force them to do that. But the other end, if they just want to hold on it and keep it for security for their future generations and all that then it applies. So we – SABL was basically used along those lines. But I believe it has been looked, it has been blown out of context to say that it is purposely for business alone. But it is not necessarily in that context.

Q: What is your view about the use of incorporated land groups? What are the lineage or customary, sort of like genealogies and because they---

A: Well, in the context of ILGs we are encouraging as much as possible that it is clan based; communally owned land that people should register ILGs and not anybody. You know, in a family where if you have six brothers, you register six ILGs. We strongly emphasize that ILGs should be clan based where the entire clan is, they agree to having an ILG and for the use of that ILG for their purpose in terms of if they want to register a SABL or something like that.

COMMISSIONER JEREWAI: Mr Kila Pat, among many reasons for this Commission of Inquiry is the paramount one that 5.2 million hectares of

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customary land in Papua New Guinea have been “alienated”. And I use that word “alienated” in quotation only. It still bothers me that you are stating a position with regard to acquisition of customary land by the section 10 and other provision process which is a total alienation to distinguish between that kind of alienation as opposed to the alienation through the SABL process and which process also carries a term of not in excess of 99 years. And section 11 of the Land Act says, particularly subsection (2) “that where the Minister leases customary land under subsection (1), an instrument of lease in the approved form executed by or on behalf of the customary landowners is conclusive evidence that the State has a good title to the lease and that all customary rights in the land” - I emphasize those particular words again - “and all customary rights in the land, except those which are specially reserved in the lease are suspended for the period of the lease to the State.”

[12.07 pm] Is that not complete alienation, if not for the specified period of the SABL lease? If you can, I just want to draw you out and comment on that. Because it does not seem to sink in with what you are stating, which is not contained in any provisions of the law, that is the distinction between the requirement for Certificate of Alienation as between complete alienation as opposed to alienation that vests the title back in the customary landowners through that process. But here we are inquiring into 5.2 million hectares of Papua New Guinean customary land alienated. And as evident in, for instance, Brilliant Investment in the title held over the Marienberg portion 146, the developer company holds title to that land.

A: Whilst, Commissioner, when looking at section 11, it also, there is this provision which talks about the alternate to which the landowners may wish to nominate who holds title to the SABL is something that comes into contention where it can be issued to an individual, group of people, incorporated group and entity of their choice. And so ---

Q: I understand that, Mr Kila Pat. The point I am making is in respect of 5.2 million hectares of customary land alienated, irrespective of whatever distinction you may want to put as between complete alienation and alienation reserved to be re-issued to the customary landowners. Evidence in this Inquiry thus far shows that quite a number of non-landowner entities hold title to these SABLs. In other words, there have been some defects. If we are to go by the process that you have just described, there have been some defects resulting with that kind of

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alienability where title have not been re-issued to the customary landowners’ choice of the entity to hold that title. Now, would you not agree that if we go by what Chief Secretary, Manasupe Zurenuoc said in his evidence that had those matters been submitted to the Custodian of Trust Land, perhaps the possibility of non-landowner choice of entities holding titles to SABLs would have been removed?

A: Commissioner, I do understand that. I guess it is something that needs to be investigated and the department needs to further look at it and provide a position on that.

Q: Sure.

THE CHAIRMAN: Mr Kila Pat, section 166(3) of the Land Registration Act, in my view, gives the Custodian of Trust Land some very, very serious responsibility to a customary land to the extent that the Custodian can sue and be sued in a manner he deals with customary land. I want to think that that is a serious responsibility. If you put – if you try and put things into historical perspective, the whole intent I would like to think was to protect title to customary lands for the natives in those days; in the earlier days. And because of the level of, well many of our people are illiterate and they do not have understanding on acquisition of land.

[12.12 pm] Because of that a Custodian of Trust Land was appointed to take care of their businesses when it comes to acquisition of their customary land. And this is a serious responsibility, in my view, entrusted to a government official to act for and on behalf of the ordinary landowners or customary landowners who have little or no idea altogether about how land is acquired and what process to follow and so forth. So I have this strong view that it is something that it is not that simple. It is not a mere responsibility or function of some sort that can be down-played. The seriousness of this responsibility placed on the Custodian of the Trust Land is very high, that the government expect a government officer to act in the interest of the landowners. So I think we, and I continue to say this and I go back to what I said earlier on, and that is we need to put this too into perspective. It is very, very important. There is a strong emphasis that a Custodian of Trust Land continues to play an important role in all acquisitions under section 7. And in my view it is not, and I am saying that with all due respect to yourself, it is not a – that responsibility cannot be down-played, to say that it is an administrative responsibility and a decision can be made by

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someone within the Department of Lands to say that yes, we can proceed without the issuance of the COA. That is the way I am reading it. Because I am looking at all the relevant provisions of both the Land Act and the Land Registration Act and I have this very strong view that the Custodian of Trust Land plays a very, very, important role in that.

A: Chief Commissioner, I do ---

COMMISSIONER JEREWAI: Mr Kila Pat, if I can draw your attention back to paragraph 13 of your affidavit, where you stated that the department’s view is the vested interest of land acquired other than for SABL vests in the State, whereas a SABL interest in land is vested in the customary landowners. Now, if we were to follow your line of explanation, in distinguishing between land to be totally alienated from the customary landowners as opposed to SABLs which are to revert in their title back to the customary landowners’ choice of entity to hold the title, would that – should it not follow that any SABL titles currently held, if not vested, if the title is not vested in the landowner choice of entity as titleholder, then it should be cancelled. The title should be cancelled.

A: Commissioner, if there is no consent by the landowners and obviously, I would think, in my view, that that should be what – that is what should be---

Q: I am not talking about only the consent, I am talking about entities totally outside of landowners, if we are to follow your line of distinction between complete alienability as opposed to alienability temporary because title reverts to the landowner entity even if they consent. What I am suggesting and which I would like you to comment on is that even if they consent, if we follow your line of thought on this or statement as contained in your affidavit, then anyone else other than a landowner entity ought not hold title to SABLs.

A: Commissioner, maybe, I am not really clear. But what if I can restate it again to say that SABLs would only be issued on the condition that the landowners consent. If they do not have consent to ---

Q: I know that, you raised that before. I am trying to follow your line of distinction as between total alienability and temporary alienability so that we can rule out the Custodian or Trust Land. If we are to follow that, what I am suggesting is that that will render that anyone else other than

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the landowner entity - with or without their consent - cannot hold title to SABLs. Because if anyone else can, question of Certificate of Alienability will have to come in.

A: Commissioner, I get where you are coming from. I will still maintain the position that it has to be landowner interest, you know.

Q: Okay.

A: Rather than anybody else. Just going back on what the Chief Commissioner has said, I do acknowledge the concerns that has been raised in relation to trust.

[12.17 pm] What I wanted to say is that I am merely stating the current practices that has been or what has been practiced in the department in as far as how we go about administering. So that is basically what we do. But in the event that we go further and find out that no, there are things that we need to do properly and all that, then that is – I think that is the whole gist of what we are trying to do is basically go down that path and say, “Oh Lands, you need to do it this way” or “Provincial Affairs, you need to do it this way.” I think that is what we are looking forward to. But what has been done is what I am basically presenting at the Inquiry for purposes of the Inquiry.

THE CHAIRMAN: Mr Kila Pat, I think we are almost done with you now. I have to ask you earlier on, I want to repeat that and if you can be able to give to us, you do not have to appear, probably through your lawyers to our Counsel, a copy of that administrative decision that was made 10 years ago, to do away with the COA from the Custodian as you have mentioned and of course the decision that was been made based on the instruction that was given by your in-house lawyer. We need to also see that to help us wind up your side of the evidence. So you can give that to the Counsel and forward it to the Inquiry. Counsel, we are now done with Mr Kila Pat.

MR KETAN: Well, I have a few questions to ask if the Commissioners will allow me to do that. Just going back to, very quickly Mr Kila Pat, you state that 10 years ago - now, 10 years ago if the process was stopped that would have been – that will take us back to, from today to 2001. You would agree with that?

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A: Counsel, you said about 10 years ago because it is based on the information I gathered. But that is something I need to - I did inform the Commissioners that we will provide the – do further findings on it and confirm.

Q: Yes. But taking your statement 10 years ago, just – I will put it to you, 10 years ago would take us back to 2001?

A: About 2001, yes.

Q: There are two questions I want to ask on that. One is, you state the legal opinion by the late Ian Kundin, legal officer of the department. But do you know who actually issued those instructions? Was it your predecessor?

A: Yes.

Q: Do you know the name or?

A: I would like to confirm that properly so that I give an accurate information as to what I am reporting on. Thank you.

Q: Yes. As far as you are concerned, that has been the practice?

A: Correct, yes.

Q: If I put to you that since 2001 and as late as 2007, Certificates of Alienability have been issued by the Custodian of Trust Land. Would that surprise you?

A: Not necessarily Counsel, because the Certificates of Alienability were issued, especially when there was outright purchase or land that was to be leased so we talking about three different areas of issuance; one with SABL and the other two with outright purchase and land lease from landowners. So---

[12.22 pm] Q: I will show you a Certificate of Alienability on one of the files that we have created. It is on portion 519C, Rigo. It is one of the SABLs which form part of the total 20,000 hectares of land on which the cassava project is on. That is issued by the late Ilagi, Secretary of the Provincial Affairs Department.

A: Yes.

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Q: That is dated 20 April 2007.

A: Counsel, I apparently was not in country at the time this thing happened. But from the – because I was away on study in 2007. But basically, if I may just very briefly state that the project that you are referring to is a NEC decision where government actually made a decision for the department to - that is the Cassava Project - and so it was on government direction that the department go ahead and ensure that this project get off the ground because it was seen to be very significant for purpose of the country.

Q: Yes, I ---

A: And so you will note that to a certain degree there was government interest in this that the project had to go ahead.

Q: Yes, but if we just stick to your evidence. That is – first, that is a Certificate of Alienability that was issued in April 2007. There is a date at the bottom.

A: Yes, April of 2007, correct Counsel.

Q: And it was issued by the Custodian for Trust Land?

A: Counsel, what is not specified in here is normally when you look at it, it says, “customary landowners of the aforesaid land and the customary landowners of all improvements thereon are willing to either sell or lease their land for a period of 40 years.’ So he did not specifically state whether they were selling it outright. And this is where I was coming in to say that this provision allows for selling of land outright or leasing of land from the landowners where the State pays. For leasing, it pays an annual lease rental and for purchase we do compulsory acquisition where compensation is paid. So these are some of the areas that are not very, very clear. It does not specifically go down to talking about SABLs. So it is something that we would like to go more detail on it and possibly provide a report to the Inquiry on this matter.

Q: Well, I am putting to you that that is in relation to portion 55 ---

A: 19C.

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Q: 19C which forms part of the Cassava Project in Rigo that has been issued to the project that has been developed by the Cassava ---

A: Changhae.

Q: Changhae Tapioka (PNG) Limited. So I am putting to you that even as late as 2007, we still have had Certificates of Alienability issued by the Custodian for Trust. Mr Manasupe was – the Chief Secretary was very, very clear in his evidence and you heard him. He was sitting on the day when he gave evidence and he was very clear that without a Certificate of Alienability, there cannot be any alienability of land. See in paragraph 9 of your affidavit - you look at paragraph 9 of your affidavit. With the Land Investigation Report, the provincial or district administrator as the case may be, recommended alienability of customary land. Those officers in the provinces who are by the way, officers of the Department of Provincial Affairs, who are involved in the ---

A: Sorry, Counsel, can we just correct that. They are not officers of Provincial Affairs, they are officers of the provincial Lands division. Because they are the only ones who are authorized to do land investigations on the ground.

[12.27 pm]Q: But I am referring you to paragraph 9 of your affidavit. Paragraph 9 of your affidavit. You state that, “After conducting a land investigation, a land investigation report, LIR, was compiled where the Provincial or District Administrator recommends for the alienability of customary land.”

A: Sorry, I will clarify that. What I was saying was that the actual land

investigation officers are done by the lands officers in the province and before they submit the land investigation reports to Port Moresby, they get it cleared through the provincial or the district administrator at the location where the investigation is done.

Q: Yes. A: Yes, so it is not the provincial or the district administrator who does the

land investigation report, it is- - - Q: No, I am talking about the- - - COMMISSIONER JEREWAI: No, the question is about recommendation.

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MR KETAN: Yes. A: Recommendation, yes. I just wanted to get that clear because I did not

get him. COMMISSIONER JEREWAI: Who recommends? A: The provincial or the district administrator. MR KETAN: Yes, that is what I am asking. Is that the system currently in place? A: Correct, yes. Q: Well, you cannot have it both ways. You have a recommendation for

alienability- - - COMMISSIONER JEREWAI: Who are they recommending to? A: They are recommending in the land investigation report, based on the

purpose for which the investigation has been done. If the land investigation report is done for purchase or lease, then they have to do a recommendation that, yes, this land – because they are on the ground; they are with the- - -

Q: In other words alienability? They are recommending alienability? A: Certificate of Alienability to be issued. Q: And who are they recommending it to? A: It is in the land investigation report that comes to the- - - Q: I understand that, but they are recommending alienability and who are

they recommending it to? To the Custodian of Trust Land or to the Secretary for Lands or the Minister?

A: Well, because the process comes through Lands Department and then if

we find in the land investigation reports that there is a recommendation for alienability, we refer it to Provincial and Local Level Government Affairs. But prior to we giving in to them, we ensure that the land investigation report complies with the standard requirements. We ensure that those documents are complete before we refer it to the Custodian,

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who then upon receiving the documents recommends for alienability. I mean, approves, not recommends approves, based on the recommendation.

MR KETAN: So I put to you that that is the system that is still in place? A: Correct. Q: Yes. So your evidence about “had been done away ten years ago or so”,

it may not be correct? A: I was, Counsel, referring to that, “not for all Certificate of Alienability”, I

was making specific reference to “SABL”. But we continue to receive Certificate of Alienability, particularly on land that is to be compulsory acquired or land that is to be leased from the customary land owners.

Q: I do not want to be difficult with you, but if you look at the Certificate of

Alienability that I have given you, the copy of the Certificate of Alienability, that is for 40 years, for 40 years. Under section 102, leases of customary land acquired pursuant to section 11 of the Land Act can be leased for up to a period of 99 years. But that is for a shorter period, 40 years. So if we understand you correctly, for that short period in 40 years time, the land will revert to the customary land owners, that there should not have been a Certificate of Alienability?

A: Counsel, this is a project where there is a life span on whatever the crop

is, okay. So it does not automatically go back. After the 40 years, the landowners will sit down with the State and the developer and they can re-negotiate for an extension to the lease, given the significance of the project. When it comes to 40 years, and if they have – if the reason why the project has been set up has lived its purpose and they no longer require it, then obviously it will revert back, but if there is a need for it to be extended then it can be extended. That is provided for.

[12.32 pm] It applies in any lease situation where, for example, in a 99 year State

Lease when it expires, the leaseholder is given the opportunity to apply for a renewal of the lease and maybe they have substantial amount of improvements on the land and they still need the land to further conduct their business, they can apply for a renewal. So this is no difference from that. They can also apply for an extension if they need to if the period is up.

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Q: Yes. I will leave that line of questioning, I mean, for the moment. But it does state that the evidence---

COMMISSIONER JEREWAI: Counsel, it has been noted that there is really no consistency in the interaction between the various mainline agencies with regard to SABLs. MR KETAN: Yes. COMMISSIONER JEREWAI: And in actuality, Mr Kila Pat’s integrity in terms of his credibility is not in issue here; it is not in question. I think he is doing the best he could from the stand point of his department, and that is what he knows as far as the processes are concerned. If not that firmly official, partially firmly official, however you may want to describe it, but the Commission of Inquiry will be well appraised by now as to the lack of cohesive policy and administrative aspects to be put in place or have been in place to deal with these matters. MR KETAN: Yes. COMMISSIONER JEREWAI: So, we take note of that. MR KETAN: Yes, and there have been changes to the position at the department and himself, he has had to change positions – I mean, we understand. But the question that I am asking is not to you personally but the department – your department. But, anyway--- COMMISSIONER JEREWAI: In no way impugn your credibility, no, that is not an issue here, Mr Kila Pat. A: Thank you, Commissioner. THE CHAIRMAN: Counsel, I was going to say, unless you have got other new – you seem to be asking the same questions, except that we are posing from different angles. What is obvious to us now is that there is a difference of views expressed through the affidavits tendered in by the Chief Secretary, Mr Zurenuoc, and of course, various other affidavits including that of Mr Kila Pat. I think it is becoming more important that at some stage, the departments will have to look at summing up everything through a submission and those issues can be canvassed in the submissions that they will make at the end of it all. I think it is becoming obvious there are a few points that have stuck out in the questions that we have asked throughout this morning. So I think we can leave that and Mr Kila Pat has taken note of some of the issues that we raised and I

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am sure he can address that at some later stage through his lawyers or lawyers of the department. MR KETAN: Yes. THE CHAIRMAN: Unless you have got some other new things to ask, as I said earlier on, I think it is the same question except that we are posing at different angles. Thank you. MR KETAN: Yes, very well, Chief Commissioner. There are two last questions ; one, you might like to correct this, Mr Kila Pat. In your affidavit at paragraph 11, second last sentence; “State leases to be leased to the customary landowners for a period of no less than 99 years.” That might be – perhaps you might like to consider that that might have been a typographical error because leases are to be issued up to a period of 99 years, not – 99 years is not the least, not the minimum. THE CHAIRMAN: It is not a minimum. Yes, that is right, I note that. MR KETAN: Yes. THE CHAIRMAN: Of not more than 99 years or something.

[12.37 pm] MR KETAN: Yes. The only other question is, some of these notices of direct grant under section 102 by the minister, some of those signed by the officers, yes, people other than the minister and the secretary, and in one particular one that I am looking at, it was signed by A. Luben, who I understand is Anthony Luben, the Deputy Secretary for Administrative Services? A: The former Deputy Secretary, Land Services. Q: Land Services. Now, if I can ask you just in terms of the delegation,

because we have evidence that at the same time, at around the same time, this is dated the – perhaps if I can just show you this. Associate, if you can hand this up to the, just one to the witness. Now, just so that we put you in the picture – this relates to SABL portion 884C milinch Djaul fourmil Kavieng New Ireland Province issued to Cassava Etagon Holdings Limited. Mr Luben, from the file; the information we have on the file was involved in the land investigation report or land investigation and he was there when there was a landowner dispute and – anyway, he was involved in one other, I think, that is another I am being correct about it by my friend. That is a different situation, but generally Mr Luben, who is the Deputy Secretary, signed this grant. We need to – this

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has come up previously in the evidence, we need to – if you can help us to understand this delegation because there is the minister, the secretary and deputy secretaries.

A: Yes, but Counsel it can be further delegated right down to the Deputy

Secretary level to sign on behalf, as a delegate of the minister. Q: Yes, and the delegations are usually done by instrument? A: Yes, I would think so, yes. Q: Just for completion, for completion sake, in addition to the other

information that you will provide, if I can ask, through the Commissioners that if you give us some examples of the delegations, especially now that I have mentioned this, we would like to see. It is part of the evidence that- - -

COMMISSIONER JEREWAI: Counsel, if I may assist. If I may assist, just very quickly. The original power rests with the minister, is it not? MR KETAN: Yes. Q: And he then delegates- - - MR KETAN: To the deputy --- COMMISSIONER JEREWAI: To the Secretary of the Department of Lands and Physical Planning and the Deputy Secretaries of the Department. A: Yes. MR KETAN: Yes. COMMISSIONER JEREWAI: Is there any provision in the Land Act that allows for further delegation? You have to bear in mind the principle of delegatus non potest delegare. MR KETAN: Yes. COMMISSIONER JEREWAI: The power to delegate does not include the power to further delegate?

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MR KETAN: The power itself? There is legislation on the – I have not – I cannot point to any section in the Land Act, but the minister- - - COMMISSIONER JEREWAI: That is fine, Counsel, just ask Mr Kila Pat if indeed further delegation had taken place and you can later check with the provisions to see if that is allowed under law. MR KETAN: Yes. A: From my experience the minister can delegate to the Deputy Secretaries

to perform as delegates of the minister and it is on instrument.

[12.42 pm] Q: The Minister himself? A: Yes. Q: Yes. A: But that is acting on advice from the Secretary to the Minister. Q: Yes, there are different powers under the Land Act, as you know, but if

you can give us some copies of instruments just on this particular power to grant under section 102. If you give us some copies to the Commission, we would appreciate that. Is Mr Luben still with the Department?

A: No, he is unattached at the moment just waiting to be formally

retrenched. THE CHAIRMAN: Counsel, sorry. Mr Kila Pat, the Secretary for the Department is delegated the power at the first instance, is that correct? A: Correct. Q: In his absence then it goes down further to the Deputy Secretary, would

that be correct? A: That is correct, but it is done directly by the Minister. Q: So, he can bypass the Secretary, even if the Secretary is available and go

direct to the Deputy Secretary to delegate that power?

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A: Well, from my experience, yes, there has been delegations done by ministers previously directly to deputies because secretaries are not always available, and in a department like Lands if we do not have delegations, then everything stops. So it is important that delegations go down to the next level so we can assist their secretary in clearing a lot of documents that come through.

Q: Thank you. MR KETAN: Regulations can be made under the Ministers Delegation Act of 1975 by the Head of State, but - that is fine. THE CHAIRMAN: Okay, thank you, Counsel. Perhaps, Mr Kila Pat may I suggest that you also consider to include that in the final submission that your Counsel, your lawyers might want to make to sum it all up on the issue on delegation as well. A: Okay, Commissioner, I take note. THE CHAIRMAN: Mr Kila Pat I want to thank you. I think we are done with you now. Counsel, we are done with Mr Kila Pat so thank you for coming, but I just want to remind you again of some of the points that we have raised with you if you can assist us by providing some response to that at a later stage. We are not going to give you any time line. I give you enough time for you to get your people to work on it and give us some information on that just to clarify on some of the points that have been raised. Thank you for coming. A: Thank you Chief Commissioner and Commissioners, thank you. THE WITNESS WITHDREW THE CHAIRMAN: Counsel, what is the other- - - MR KETAN: We have nothing planned for the rest of the day. COMMISSIONER JEREWAI: Except for the schedule of hearings beginning with the opening of the files.

[12.47 pm]MR KETAN: Yes, tomorrow.

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COMMISSIONER JEREWAI: Who are we commencing with tomorrow?

MR KETAN: Tomorrow we are commencing with ChanghaeTapioka(PNG) Limited.

COMMISSIONER JEREWAI: And that will be at 9.30 a.m.?

THE CHAIRMAN: You want to indicate for record purposes, the Commissioner and the team that is assisting, when we start tomorrow morning?

MR KETAN: It is yourself, Chief and me. That is seven of the ChanghaeTapioka ones and then there are three others for tomorrow. Okena Goto Karato Development, Perpetual Shipping – or sorry the last one tomorrow will be Okena Goto Karato Development.

THE CHAIRMAN: And who is doing that?

MR KETAN: Commissioner Mirou.

THE CHAIRMAN: All right then. We commence tomorrow morning, 9.30 with myself and obviously you and your team at 9.30 and following that in the afternoon will be Commissioner Mirou. The schedules have been out so. With all the authorizations that have been issued and of course my opening statement this morning, we will, as of tomorrow, commence individually as Commissioners. It gives effect to that authorization, the opening statement that I made this morning. All right, we shall adjourn until tomorrow morning at 9.30. Thank you.  

AT 12.49 P.M. THE COMMISSION OF INQUIRY INTO SABL ADJOURNED TO TOMORROW, WEDNEDAY 21 SEPTEMBER 2011 AT 9.30 A.M.

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INDEX PAGE NO

MR ROMILLY KILA PAT, Continuing…………………………. 07 XN: MR KETAN…………………………………………… 07 WITNESS WITHDREW…………………………………………. 39

EXHIBIT PAGE NO

EXHIBIT RKP15 TENDERED – AFFIDAVIT OF……………… 09 MR ROMILLY KILA PAT OF 19 SEPTEMBER 2011