State to give back land to landowners

THE State will have to forgo 211,600ha of commercial land to customary landowners following a recent National Court decision.
The court found out that the State had acquired the land without proper agreement with the landowners.
The land, earmarked as an agro-forestry area situated 200km south-west of Popondetta, Oro province, and formally described as Portion 16C, was acquired by the State on Dec 19, 2008, through a 99-year lease with the customary landowners, executed under sections 10 and 11 of the Lands Act.
Again on Dec 23, 2008, the same land was leased by the State to a landowner company, Musida Holdings Ltd, through a 99-year lease, executed under section 102 of the Land Act.
However, the first plaintiff, Musa Valley Management Company Ltd, which is also a landowner company, was aggrieved with the decisions made by the secretary for lands, and alleged that the preconditions under section 10, 11 and 102 of the Lands Act had not been satisfied by the State and they (landowners) were denied natural justice and that the decisions were unreasonable.
Musa Valley Management Company and the company which it promotes as the preferred developer of the agro-forestry project, Musa Century Limited, the second plaintiff, applied for leave to seek judicial review of the secretary’s decision and leave was granted.
The matter proceeded in court and the plaintiffs relied on three grounds.
They claimed that the secretary had failed to follow proper procedures under the Land Act, in particular by failing to secure the agreement of the customary landowners to the acquisition of the land by the State and to the lease-back to Musida Holdings Ltd (paragraph 5(4) of the Order 16, Rule 3(2)(a) statement).
They further claimed that the secretary had acted unreasonably as there were only 10 Incorporated Landowner Groups (ILGs) out of the 62 ILGs involved in the signing of the agreements.
However, the defendants contented that a land investigation report prepared on May 16, 2008, showed that majority of representatives of the 62 ILGs signed an agency agreement agreeing to lease the land to the State.
The State contended that the meeting of Dec 12, 2008, concluded that the decision about which company should ultimately be granted a lease-back from the State should be made by the Department of Lands and Physical Planning, adding that the secretary made his decisions in good faith based on all the documents before him.
The State further contended that the company extracts of Musida Holdings Ltd show that it has always had a larger and more representative shareholding, representing a majority of the customary landowners of Portion 16C.
While going through the submissions, Justice David Cannings found that the land investigation report carried out by the State did not clearly indicate that there was agreement by all or a majority of the landowners that the lease would be granted to Musida Holdings Ltd, the evidence were vague.
Justice Cannings found that section 110 (2) of Land Acts were breached by the State, when it acquired the land.
“The secretary’s decisions were seriously flawed and I am satisfied that his decisions must be quashed and that the leases dated Dec 19 and 23, 2008, must be declared null and void, and would suggest that the parties go back to the drawing board and engage the services of a mediator to resolve this dispute,”  Justice Cannings said.