Land & Law

A dispute between two foreign timber firms over a logging concession on Santa Isabel Island has turned into a protracted legal battle that highlights weaknesses in the Solomon Islands government's ability to enforce its own sovereign law.

Now in its 23rd month before the High Court, what began as a simple claim of 'trespass' has produced a string of court orders and a contempt-of-court action alleging that illegal logging continued in defiance of these orders.

The offending company - Mega Enterprises ('Mega') - was taken to court along with its local partner in April 2008 to stop it cutting trees and exporting them from an area known as Lot 17. The area is part of land whose title belongs to Isabel Province and whose logging licence was awarded to a rival company, Glengrow (SI) Ltd. It is situated on the southwest coast of Santa Isabel in an area known as the Allardyce tract.

At the time the Province and Glengrow took action in 2008, illegally felled logs were estimated to total 2087 m3 but last December the claimants filed a contempt-of-court action accusing Mega and its local partner of ignoring the original court order to cease its illegal operations.

The company's local partner is Ruruma Development Company (RDC) formed by John Kera, a customary landowner and trustee of registered land that adjoins lots owned by the provincial government. When Telinga Media visited the coastal log camp at Ruruma in October, Mr Kera was absent but his staff said that the suspension of logging at that time was 'not permanent'. But one week later, RDC lost its licence.

In August, a government team acting on behalf of the national Ministry of Forests and Research had visited the disputed area and reported that logging was still going on in Lot 17, including during the inspection team's visit. It recommended in its report that RDC's licence - which covers its own registered land - be cancelled. The Commissioner of Forests acted on this recommendation, placing a rice cultivation project run by RDC and supported by its Malaysian logging partner in jeopardy.

The original court orders tried to restrain the loggers from further cutting or harvesting of logs from outside RDC's own concession area; they also froze proceeds from the sale of logs from an export shipment. This was later changed to include only those proceeds derived from the sale of logs from Lot 17.

In May 2008, the High Court had reasoned that it could not meet Mega's request to release part of these frozen funds for the company's 'operational costs' unless it was certain that it had the ability to pay the claimants if they won any subsequent damages claim. A week later it gave Mega the benefit of the doubt by releasing over US$300,000 to cover the company's 'certified operational costs'. The court order made no mention of any evidence it had to confirm the company's financial status or ability to pay any subsequent claim.

Last year, the protagonists were at it again fighting over control of Mega's ill-gotten assets in the form of a large shipment of 6000 m3 of logs. In November, the court again saw it Mega's way when it cleared the way for the logs to be exported and dismissed Glengrow's attempt to exert control over the shipment's cargo and its sale in overseas markets.

Repeat offence

Meanwhile, the Commissioner of Forests was issuing repeated warnings to logging operators at Ruruma to cease logging provincial land on the Allardyce tract. The most recent was a letter in July last year entitled 'Reminder to withdraw or refrain operation from Lot 17 and 18'. A similar message was contained in another High Court order the same month.

It was with these official notices in place that a forestry team was sent to Allardyce in August to investigate for itself. It reported back to the national ministry a series of findings that suggested that Mega and local partner RDC were ignoring these warnings. They include - logging continued in several areas within Lot 17 during the site inspection; a barge anchored off Ruruma was loading timber during the site inspection; 1500 m3 of logs from Lot 17 - valued at over US$107,000 - were stockpiled along the road; 'a full scale logging operation' was in progress, not just construction of access roads.

Investigators also sought to quantify the volume of logs that RDC and Mega could be expected to harvest from RDC's own concession; using a ratio applied across Isabel Province, officials estimated that operating within its licence area would yield about 13,500 m3. And yet, since 2008 the operation had harvested 22,600 m3 of timber for export.

Mega's managing director is Hii Yii Ging. Mr Hii declined Telinga Media's request for interview.

Now the matter of ignoring the original order will bring Mega and Ruruma landowners back to court to face a contempt-of-court charge sometime this year. Despite the RDC licence cancellation bringing an end to its partnership with Ruruma landholders, Mega has been free to continue to export logs from its other operations around the Solomons, including several camps in Malaita and Western provinces.

Undersized logs

Leaving aside issues of trespass and illegal harvesting on provincial land, the now-defunct partnership between Mega and RDC which began in February 2008 has not been trouble-free. RDC manager Alan Nepia was referring to his Malaysian business partner when he told Telinga Media in October: "Malaysian companies are very aggressive on logging. They just fell logs that are undersize logs." Asked what his company was doing about it, he replied: "At the moment, we just let them go; maybe other companies we invite them in the future."

The High Court's initial actions in 2008 were designed to stop the defendants logging in someone else's concession; it also ruled that funds derived from these illegal activities be quarantined in an account controlled by all the parties. However, during 2009 it became clear that the court orders were being ignored, causing the Commissioner of Forests to issue further warnings.

The inspection team in August confirmed his worst fears and the licence was cancelled in October.

"I was giving them ample time for them to respond and there was no response," Commissioner Basil Gua told Telinga Media.  "In this situation it was quite serious because there was a continuing (ignoring) of court orders and my instructions to vacate the site."

It wasn't long after court orders were first imposed that Mega was able to access some of its ill-gotten wealth with the court's blessing. Ironically, the first relaxation of restrictions on funds from exported logs was to pay the contractor who carried out the illegal operation in the first place. The court acknowledged that the long standing practice 'to protect the costs and expenses incurred by logging contractors' could have the effect of sustaining illegal logging 'by contractors who are confident in obtaining their certified costs of operation'. Nonetheless, 10 days later the court ordered that over US$300,000 be released to Mega for its operating costs.

The High Court in its rulings has consistently favoured facilitating the defendants' ability to trade, notwithstanding evidence that its own orders were being defied. The forestry inspection team's damaging report was written at the end of August and was followed less than two months later by the licence cancellation. And yet in November the court was persuaded by Mega's representatives to relax constraints on the company's ability to move a shipment of logs offshore. The order concerning 6000m3 of logs cleared the way for Mega to control their sale and the income from the sale and ruled against Glengrow's rival claim to control the shipment.

The High Court's time and expertise has been largely consumed by questions of how to manage funds and assets derived from illegal behaviour. It has released substantial amounts of these funds to ensure that the loggers who engaged in illegal activity got paid for their work; government continues to receive its share in the form of export duties. All this is based on an expectation that the guilty parties will be in a position to pay the victims' claims for damages at some future date.

But even if the claimants win, that day could be some time away if Mega's track record is any guide. An operation run by Mega Corporation and landowners from Western Province was declared illegal in March 2003 and damages were awarded, but creditors were still chasing Mega in May 2006 for a debt of more than seven and half million Solomon dollars.

Despite their efforts, the courts - along with parliamentarians and their bureaucrats in Honiara  - have not been able to coordinate their moves to actually prevent illegal logging occurring over an extended period. There is little sign that the justice system is making much of a  difference to the behaviour of those who appear to neither respect nor fear the law.



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