PNG Court Orders Chinese Company To Pay $15.5 Million For Illegally Extracting Road Building Materials

Biggest ever award in PNG ordered to be paid to Kundiawa businessman, family

PORT MORESBY, Papua New Guinea (PNG Post-Courier, ) – The National Court has ordered Chinese Civil Engineering company, Covec (PNG) Limited to pay over K50 million [US$15.5 million] to a Chimbu landowner family for illegally extracting road building materials from their land.

The award, regarded as the biggest ever in Papua New Guinea to date, is for the value of rocks, sand and gravel, interests and other special damages to Kundiawa based businessman, Peter Kama and his family.

In his ruling Justice William Neill, sitting in Goroka, Eastern Highlands last week Wednesday ordered Covec (PNG) Limited to pay over K26 million [US$8 million] to Peter Kama and his family for the road building materials it extracted illegally from their land in 2006 to carry out the road works between Kundiawa and Miunde in Chimbu Province and other civil works in the Highlands provinces.

Justice Neill said K25,680.064 was the value of the deposits that were taken out by Covec from Portion 1239C, land registered as a Special Agriculture and Business Lease to Peter Kama, Anna Kama and Micah Kama.

Justice Neill further ordered Covec to pay interest accrue at the yearly rate of 8 per cent from May, 2009, to the date of judgement and thereafter until settlement.

Kama took Covec to court in August, 2007, registered at Goroka National Court but the previous law firm he engaged did not prosecute the case promptly and has been delayed. In December, 2015, Kama changed lawyers and engaged Gagma Legal Services based in Port Moresby to take up the matter and the principal Camillus Gagma promptly made amendments to the Statement of Claim with leave of Court and clearly plead facts and particular rise damages, which led to the expeditious trial and the judgement on 10th January 2017.

"The amount of K25, 980.064 plus special damages and 8 per cent annual cumulative interest will approximately add to a judgment sum of over K50 million. This is most probably the highest award of this kind in Papua New Guinea by the high court," Mr Gagma said.

In his ruling, Justice Neill said: "Without any colour of right or authority from registered proprietors, the defendant (Covec) took valuable mineral deposits from Portion 1239C for its profit and did so recklessly not caring to identify the registered proprietors.

"There is no evidence that destruction of the Plaintiff’s Portion 1239C from 2006 on, was due to any natural event or changes in the Waghi River.

The value of the deposits extracted is K25, 680,064.

Covec contended that it based its operations on State land (Portion 543), part of which is presently occupied by the Barawagi jail, run by the Correctional Institutional Service (CIS), following an Memorandum of Understanding (MOU) it signed with the jail.

The company moved equipment and workers on the site and commenced operations to extract the gravel and other materials from the Waghi River area, in exchange for provision of some construction services and goods to the jail as provided for in the MOU.

However, it was established in court that Covec’s operations were outside of Portion 543. The company and the CIS Barawagi did not make any effort or assist to establish the ownership when Kama and party brought the matter of land ownership up.

The tussle to determine ownership went to court and in 2007, the Kundiawa Lands Court determined that Kama and family were the legitimate owners of Portion 1239C, reconfirming a 2003 Simbu Provincial Land Mediation team decision. This was the land where Covec had based its operations.

PNG Post-Courier
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Peter Kama and his family is not the legitimate land owner as stated the appeal from the other parties as registered with Adam Ninkama lawyers based in Port Moresby, encourage Covec to appeal.

Just get the money and share. Forget the tussle again. Stop being naive and greedy. Say thank you to Peter Kama and share the victory.

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