The Republic of Vanuatu v Pierrina

JUDGMENT OF THE COURT

Introduction

1.    On 31 August 1998, Cyril Molkis was registered as the lessee of leasehold title No. 03/0J/92/044 (“the 044 lease”). On 23 July 2005, Mr Molkis passed away. He was survived by his wife Molkis Pierrina, the first respondent. Mr Molkis died intestate. As a consequence, letters of administration were required. ^[1] 

2.    By virtue of regulation 7 of the Queen’s Regulation, the first respondent should have been granted administration of her husband’s estate. But for unknown reasons, Michel Tabi was granted letters of administration in relation to Mr Molkis’s estate by the Supreme Court on 7 May 2008. A grant of administration to a person does not give that person any personal right to the benefits of the property of the deceased which the person would not otherwise have under law. Mr Tabi’s duty under the grant of administration was to call in and collect all of Mr Molkis’s property, pay the debts and then distribute the residue to the beneficiaries of the deceased estate. ^[2] One of the beneficiaries of Mr Molkis’s estate was his wife, the first respondent. ^[3]

3.    On 3 September 2008, there was a transmission of the 044 lease to Michel Tabi, pursuant to the letters of administration (“the first transfer”) However, as is required by s 84 of the Land Leases Act [CAP 163] (“the Act”), the Director of Lands did not register Mr Tabi as proprietor in place of the deceased with the addition of the words “as administrator in the estate of Cyril Molkis, deceased”. 

4.    Mr Tabi passed away on 25 August 2019. The 044 lease was still registered in his name. On 20 February 2020, the Supreme Court granted letters of administration of Mr Tabi’s estate to his wife, Mrs Molengleng, the second respondent. She had no legal or beneficial interest in the 044 lease, but nevertheless registered a transmission of the 044 lease to herself on 25 May 2021(“the second transfer”). Then on 28 July 2021, the second respondent transferred the lease to the third respondent, Chen Jinqiu (“the third transfer”). There is no dispute that Mr Jinqiu was a bona fide purchaser for value without notice. 

5.    The first respondent filed a claim in the Supreme Court under s 100 of the Act seeking an order for rectification of the register in relation to the 044 lease. She contended that registration of the transfers had been obtained by fraud or mistake. The claim was disputed. Relevant to this appeal, the applicant’s defence was that the lease dealings were registered in good faith and so relied on ss 9 and 24 of the Act as shielding the Government from liability to indemnify the first respondent.

The Supreme Court Judgment

6.    The primary judge held there was a mistake in the transmission to Michel Tabi, and that the transfer to the third respondent was obtained by fraud. Judgment was accordingly entered for the first respondent.  ^[4] Because the 044 lease could not be cancelled or rectified because s 100(2) of the Act applied, the primary judge made orders to compensate the first respondent for the loss she had incurred. Orders were made as follows:

a.    The second respondent was to pay VT 6 million compensation to the first respondent; and 

b.    The applicant was to indemnify the first respondent in the sum of VT 6 million.

7.    The primary judge made the following findings:

a.    The first respondent had standing to bring the claim under s 100 of the Act, as she was a beneficiary of Mr Molkis’ estate, which gave her an interest in the registered dealings of the 044 lease.

b.    The Director of Lands made a mistake in the registration of the transmission of the 044 lease from Mr Molkis to Mr Tabi pursuant to the grant of administration. That is because he omitted to include after Mr Tabi’s name the words, “as administrator of the estate of Cyril Molkis (deceased)”, in breach of s 84 (1)(a) of the Act. As the primary judge said,  the inclusion of these words was necessary to comply with s 84 (1)(a) of the Act. The words were also necessary to make it clear and unmistakable on the land leases register that the transmission was to the administrator of the estate of a deceased person.

c.    That the causal requirement imposed by s 100 of the Act was proved. Not only was there a mistake in the part of the Director of the Lands, but his mistake caused the registration of the 044 lease transmission to occur in a way that it did when he omitted the words “as administrator of the estate of Cyril Molkis (deceased)” in breach of s 84 (1)(a) of the Act. ^[6]

d.    As the administrator of Mr Tabi’s estate, Mrs Molengleng could only deal with the assets of Mr Tabi’s estate. She had no right to deal with and sell Mr Molkis’s property. Mr Tabi held the 044 lease in trust for the beneficiaries of Mr Molkis’s estate, as the transmission was pursuant to the letters of administration. Therefore, it was inconsistent for Mrs Molengleng to then assert that after she was appointed as the administratrix of Mr Tabi’s estate, she could then deal with the 044 lease as if it was Mr Tabi’s private property.

e.    The mistake in the registration of the 044 lease transmission to Mr Tabi was of such a nature and quality that it would have been obvious to the second respondent had she not shut her eyes to the obvious, as she knew the first transfer of the 044 lease to Michel Tabi was pursuant to the grant of administration. 

f.    Therefore, when Mrs Molengleng transferred the 044 lease to Mr Jinqiu, she did so fraudulently or at least substantially contributed to it by her own act, neglect or default. This was because she dealt with the 044 lease as if it was Mr Tabi’s private property when she knew Mr Tabi had only become the registered proprietor of the lease following the grant of letters of administration of Mr Molkis’s estate. 

g.     Mr Jinqiu purchased the 044 lease in good faith as a bona fide purchaser for value. Therefore the 044 lease could not be cancelled or rectified pursuant to the s 100 (2) of the Act, as that would affect Mr Jinqiu’s title. 

h.    The first respondent suffered damage in the loss of the 044 lease to her as a beneficiary of her husband’s estate.

8.    The primary judge held that because the mistake in the register was not able to be rectified under the Act, the first respondent was entitled to be indemnified by the Government under s 101 (1) of the Act. She held that ss 9 and 24 of the Act did not shield the Government from the application of s 101 of the Act. The primary judge said the second respondent was jointly liable with the applicant because she knew the first transfer to her husband was under the grant of administration to Michel Tabi, but then she dealt with the 044 lease as if it was his private property.

9.    The amount of the loss to the first respondent was VT12 million, the consideration for the transfer of the lease to the third respondent. The primary judge ordered the second respondent to pay compensation of VT 6 million to the first respondent and the government to pay the first respondent VT 6 million by way of indemnity. As we will explain, the applicant seeks to challenge the indemnity order. 

Application for enlargement of time

10.    The judgment was delivered on 9 October 2025. The applicant took no steps to appeal for five months. Initially a notice of appeal was filed on 6 March 2026. It was not accompanied by an application for enlargement of time to appeal, ^[7]  which was subsequently filed on 16 March 2026. The applicant seeks time be enlarged to appeal, on the basis there is a high likelihood of the appeal succeeding. The applicant does not challenge the findings made by the primary judge that the first transfer was obtained by mistake and that the third transfer was obtained by fraud. The applicant contends the primary judge erred in making the indemnity order against the Government.

11.    The application is opposed. 

12.    In Laho Limited v QBE Insurance Vanuatu Limited [2003] VUCA 26, this Court set out the factors to be taken into account in deciding whether or not to grant an enlargement of time to appeal. ^[8] The factors are:

a.    The length of the delay
b.    The reasons for the delay
c.    The chances of the succeeding if time for appealing is extended; and
d.    With a degree prejudice to the potential respondent if the application is granted

13.    We deal first with the prospects of success of the appeal if time were extended, then the length and reasons for the delay, and finally with the question of prejudice.

Merits of the appeal 

14.    As we have said, there is no challenge to the findings made by the primary judge as to mistake and fraud in the registration of the transfers relating to the 004 lease. Before us, Mr Bong accepted that there was a mistake when the first transfer was registered, as the requirements of s 84 of the Act were not complied with.

15.    While a number of grounds are advanced in the notice of appeal, the crux of the appeal (if time is enlarged) is that the primary judge erred in making the indemnity order against the Government, despite the findings made by the primary judge, which included that the second respondent acted fraudulently when the 044 lease was transferred to the third respondent. Relevantly, we note there is no cross appeal in relation to that finding. The applicant also contends the primary judge erred in finding that ss 9 and 24 of the Act do not shield the Government from the indemnity provisions of the Act applying. However, the applicant’s written submissions are silent as to how s 24 of the Act applies to the indemnity order made. 

16.    We agree with the findings made by the primary judge. A mistake was made in the transmission of the 044 lease to Mr Tabi in 2008. It was a transmission to Mr Tabi, in his capacity as administrator of the deceased estate. The mistake, as the primary judge correctly identified, was the failure of the Director of Lands to comply with s 84 of the Act. 

17.    Pertinently, the transfer of the 044 lease to the third respondent was only possible because in 2021, there was a transmission of the lease to the second respondent. That should never have occurred. The 044 lease was not Mr Tabi’s property. He held the 044 lease on trust for the beneficiaries of Mr Molkis’s estate. As this Court has said, ^[9] the grant of administration does not give that person any personal right to the benefits of the property of the deceased which the person would not otherwise have under the law. The grant did nothing to determine ultimate ownership of Mr Molkis’s property.

18.    Therefore, the second respondent, as the administratrix of Mr Tabi’s estate, had no right to deal with the 044 lease as if it was Mr Tabi’s property. The primary judge found that the second respondent knew the transmission of the 044 lease to Mr Tabi was pursuant to the grant of administration. The primary judge held that the transfer of the lease to the third respondent was fraudulent because the second respondent dealt with the 044 lease as if was Mr Tabi’s property, knowing her husband had become the registered proprietor of the lease as a result of the grant of administration of Mr Molkis’ estate. That fraudulent act resulted in a benefit of VT 12 million to the second respondent, that she was not entitled to. 

19.    It was the transfer of the 044 lease title to the third respondent which caused the loss to the first respondent. It is not disputed he was a bona fide purchaser for value. As such, he had an indefeasible lease title under s 15 of the Act.  As a consequence, the register could not be rectified under the Act, as that would affect the third respondent’s title. As this Court has said, “the register is everything”^[10]. 

20.    Given the primary judge’s findings that there was a mistake in the registration of the first transfer and that the transfer to the third respondent was fraudulent, she held the applicant and the second respondent jointly liable for the damage to the first respondent for the loss of the 044 lease title. 

21.    The indemnity order against the Government was made by the primary judge pursuant to section 101 of the Act. It says:

Indemnity

101. (1) Subject to the provisions of this Act and of any law relating to the limitation of actions any person suffering damage by reasons of -

(a)    any rectification of the register under this Act;
(b)    any mistake or omission in the register which cannot be rectified under this Act; or
(c)    any error in a copy of or extract from the register or any copy of or extract from any document or plan in each case certified under this Act; 

shall be entitled to be indemnified by the Government.

(2) No indemnity shall be payable under this section –

(a)    to any person who has himself caused or substantially contributed to the damage by his fraud or negligence or who derives title, otherwise than under a registered disposition made bona fide for valuable consideration, from a person who so caused or substantially contributed to the damage;
(b)    in respect of any loss or damage occasioned by the breach of any trust; and 
(c)    in respect of any damage arising out of any matter into which the Director is exonerated from enquiry under section 24.

22.    Section 101 of the Act creates an entitlement to indemnity by the Government when a person suffers damage arising from a mistake or omission in the register that cannot be rectified under the Act. It is a backstop when a lease title cannot be rectified because a registered proprietor is a bona fide purchaser for value, and so has an indefeasible title. The affected person can make a claim against the Government to be indemnified for the loss suffered. 

23.    During the hearing, Mr Bong accepted a mistake was made by the Director of Lands when the first transfer was registered, so s 101 applied to the first respondent, who was entitled to seek indemnity from the Government. Mr Bong initially contended the Government should not be held liable to indemnify the first respondent under s 101, because the Director of Lands either had immunity (s 9 of the Act) or was exonerated from enquiry when registering the transfers (s 24 of the Act). He withdrew the submission regarding the applicability of s 9 when we pointed out to him that the claim for indemnity was against the Government, and not the Director of Lands. Further, that if s 9 prevailed over the indemnity provisions, they would be rendered meaningless. 

24.    Section 101 imposes liability to indemnify unless s 101 (2) of the Act applies. Section 101 (2) sets out when an indemnity is not payable. The first respondent did not cause or substantially contribute to the damage.The only circumstance potentially applicable to the applicant is s 101 (2)(c), set out above. In our view, that exception does not apply. This is not a case where the Director of Lands should be exonerated from enquiry, as registration of the subsequent transfers arises from the mistake in failing to meet the requirements of s 84 of the Act, in registering the transmission to Michel Tabi. 

25.    Therefore, the Government is liable to indemnify the first respondent. It follows the primary judge did not err in finding the Government liable for indemnity. But that is not the end of it, as we discuss below. 

26.    The applicant contends the primary judge erred in making the indemnity order for VT 6 million against the Government, because the second respondent solely benefited from the fraudulent transfer of the 044 lease to the third respondent, as the consideration for the transfer was VT 12 million. As the applicant contends, the indemnity order resulted in the second respondent retaining VT 6 million from the fraudulent transfer. Mr Bong submits she must be held fully accountable for the VT 12 million loss to the first respondent, given the primary judge’s finding that the transfer to the third respondent was obtained by fraud. Notably, the second respondent has not filed a cross appeal in relation to the primary judge’s finding of fraud in relation to the transfer to the bona fide purchaser for value. 

27.    We agree with the primary judge that there should be an award VT 12 million for the loss to the first respondent, but we differ as to who should meet the damages. The consequence of the indemnity award of VT 6 million is that the second respondent would retain half the proceeds of the fraudulent transfer. In other words, she would benefit from the fruits of her fraudulent actions, and that cannot be right. 

28.    During the hearing, Mr Kalsakau responsibly accepted that the effect of the VT 6 million indemnity order resulted in a windfall benefit to the second respondent, which she is not entitled to. Mr Kalsakau conceded that this Court could vary the Supreme Court judgment to order the second respondent to pay VT 12 million damages to the first respondent. If the second respondent does not pay the damages as ordered, then the VT 12 million can be recovered from the Government by way of indemnity under s 101 of the Act. The first respondent will not suffer any loss unless the second respondent fails to pay the compensation, as ordered.

29.    Mr Bong and Mr Tabi also agreed that the appeal could be allowed only to the limited extent of this Court varying the judgment to order:

a.    The second respondent to pay damages of VT 12 million to the first respondent; and
b.    That in the event the VT 12 million compensation is not paid by the second respondent, the Government is to indemnify the first respondent in the sum of VT 12 million. 

30.    While the Government is liable for indemnity, it was the fraudulent actions of the second respondent in dealing with the lease as if it was her husband’s property and transferring the 044 lease to the third respondent which caused the loss, as the lease was unable to be rectified. In those circumstances, the second respondent should not retain the VT 6 million financial benefit, which is the practical effect of the VT 6 million indemnity order. 

31.    For the reasons given above, and subject to the question of leave, we conclude that the chances of the appeal being successful if time were enlarged, are high.

Length and reasons for the delay

32.    The delay in filing the application for enlargement of time to appeal is five months and has not been satisfactorily explained. The State should conduct itself as the model litigant.  As part of that obligation, it has a duty to facilitate the administration of justice, which includes the filing of appeals within the time prescribed by the Court of Appeal Rules.

33.    The explanation for the delay is that Mr Loughman, who was counsel in the Supreme Court, overlooked providing an assessment of the judgment to Director of Lands in order to seek instructions as to whether to appeal. The applicant says Mr Loughman was occupied with finalising his release from the office of the Attorney General, following his resignation on 28 October 2025. Then it was not until early February 2026, that Mr Bong was tasked to file an appeal. However, the application for enlargement of time and draft notice of appeal were not filed until March 2026 due to late instructions and competing work interests. 

34.    The reasons for the delay are unconvincing. We cannot see how Mr Loughman’s resignation on 28 October 2025 could have impacted on his obligation to take instructions, and file an appeal, if required. Of note, Mr Loughman gave 3 months notice and was not due to finish at the Attorney General’s department until 28 January 2026. 

Prejudice 

35.    We cannot discern any prejudice if the application is granted. Potentially, there is prejudice to the first respondent who has suffered the loss of the 044 lease and is entitled to damages of VT 12 million. But, as we have said, we propose to vary the orders made by the primary judge so that the Government will be the backstop in the event the second respondent fails or refuses to pay the VT 12 million compensation to the first respondent.

Conclusion 

36.    After considering the merits of the appeal, and the very responsible concessions made by Mr Kalsakau during the appeal hearing, the appeal has strong prospects of success. If leave is granted, the appeal must be allowed to the limited extent discussed above. Therefore, and with considerable reluctance, given the unconvincing reasons for the delay, we grant an enlargement of time to appeal. 

Disposition of the appeal

37.    The application for enlargement of time to appeal is granted.

38.    For the reasons set out above, we allow the appeal only to the extent of the varied orders below.

39.    We vary the orders made by the primary judge as follows:

a.    The second respondent to pay the first respondent compensation in the sum of VT 12 million for the loss of the 044 lease title. 

b.    In the event the second respondent fails or refuses to pay the first respondent the compensation of VT 12 million, the Government is to indemnify the first respondent in the sum of VT 12 million for the loss of the 044 lease title. 

c.    The matter is remitted back to the primary judge in the Supreme Court for supervision to ensure the VT 12 million is paid. 

d.    Counsel agreed that costs should lay where they fall. We make such an order.

DATED at Port Vila this 15th day of May 2026.
BY THE COURT 

…………………………………………. 
Hon. Chief Justice Vincent Lunabek 

[1] See regulation 7 of the Succession, Probate and Administration Regulation 1972 (known as the “Queen’s Regulation”)
[2] See In re Estate of Molivono [2007] VUCA 22, and Morris v Abock [2013] VUCA 27.
[3] Regulation 6 of the Succession, Probate and Administration Regulation 1972.
[4] Pierrina v Molengleng [2025] VUSC 279. 
[5] at para 59.
[6] Para 66.
[7] As per rule 9 of the Court of Appeal Rules.
[8] The factors in Laho have been recently applied by this Court. See Tevi v Bani [2026] VUCA 4 and Ruben v Nalwang [2026] VUCA 7. 
[9] In re Estate of Molivono and Morris v Abbock, n2 above.
[10] Ratua Development Ltd v Ndai [2007] VUCA 23.
[11] The concept of the State’s obligation to conduct itself as a model litigant has been discussed and developed in a number of Australian authorities. See for example, Brandon v Commonwealth of Australia [2005] FCA 109 at [11].