Police have surrounded the court where the chief justice, Sir Salamo, is holed up in council chambers.
The crisis came to a head when on Monday, Sir Salamo and two other judges ruled for the second time that Sir Michael Somare was the nation's constitutional prime minister.
The government of Peter O'Neill has repeatedly tried to suspend Sir Salamo, whom it accuses of being biased.
I spoke with our PNG correspondent Liam Fox.
Liam what's the latest?
LIAM FOX: The latest is that Sir Salamo is still inside his chambers. There have been negotiations with police for about two hours and the result of that is that police are now prepared to interview him in his chambers rather than arresting him and taking him to a police station.
We were able to speak to Sir Salamo a short time ago; he says he's yet to decide whether he'll partake in that interview. He also said that he fears for his safety; he also fears for democracy in PNG - that what has happened today sets a terrible precedent for PNG in the years to come.
He also said that today's actions with Belden Namah clearly directing police to arrest him shows that the police aren't independent; they're not acting under the command of the police commissioner, but directly under the command of the deputy prime minister Belden Namah.
EDMOND ROY: So do they still recognise him as the chief justice?
LIAM FOX: They do recognise him as the chief justice; they're now trying to remove him. They have attempted to remove him several times over the last six or seven months by formally removing him from office, going through processes in Parliament; they have been stopped by the Supreme Court through stay orders.
At one stage they charged him with perverting the course of justice. The Supreme Court again stayed those proceedings. And these tensions came to a head again following the Supreme Court decision on Monday.
EDMOND ROY: I suppose the heart of it of course is the problem between Michael Somare and Peter O'Neill. Can this be resolved without that problem being resolved in the first place?
LIAM FOX: It's not clear how that could happen. This tension between them, this disagreement over who's the legitimate prime minister has gone on since August last year and it's unlikely, nigh on impossible to see those two getting together and sorting it out.
But what most people in PNG are hoping is that we will now, because the general election is due to be held in late June, that ultimately the people of Papua New Guinea will sort this out.
EDMOND ROY: What are the chances of this spilling out into a wider fight say between the judiciary, the military, the police and so on - which has happened before in PNG?
LIAM FOX: There's certainly a possibility of that happening. It seems at this stage that the majority of the police and the military are behind Peter O'Neill, so it's not apparent that there's any kind of split at the moment, though of course there was a split back in December when this first issue came to a head when the Supreme Court handed down its original decision.
So, as I said it's possible but at this stage unlikely that that could rapidly change in PNG.
EDMOND ROY: Liam Fox speaking from Port Moresby.
EDMOND ROY: Staying in PNG, our reporter Meredith Griffiths managed to speak with Justice Nicholas Kerriwom, in whose chambers the chief justice is now locked in.
NICHOLAS KERRIWOM: We are actually locked up in my chambers here in Port Moresby in the court house with chief justice and myself as we await police arresting officer to arrive and we'll be snapped up to interview the chief justice and to arrest him for sedition.
As of last night at 6 o'clock we were given 16 hours by the deputy prime minister to resign or face the consequences and he executed that this afternoon at about 1:30, or 2 o'clock when chief justice was (inaudible) in court. And he stormed in there with a couple of policemen, probably one other minister and started screaming at the chief justice and calling him names and ordering the police to arrest the chief justice.
And as the police headed towards the chief justice who was sitting on the bench he was forced to escape outside, get out of the court room while the associate barricaded the doorway and they chased him all the way to my chambers.
MEREDITH GRIFFITHS: So who is currently in the chambers with you; who is there?
NICHOLAS KERRIWOM: The chief justice and our lawyers.
MEREDITH GRIFFITHS: And what's the scene outside; do you know how many people are in the court or are near the offices? Do you know what's going on outside your doors?
NICHOLAS KERRIWOM: There must be something going on outside; can't be sure - let me see. There was army and police out there - yes they're still out there.
MEREDITH GRIFFITHS: How many people are outside?
NICHOLAS KERRIWOM: I'm not quite sure, I haven't actually stepped out but there was probably over 40 or 50 policemen and defence force personnel with high powered firearms.
MEREDITH GRIFFITHS: So how is the chief justice, is he okay at the moment?
NICHOLAS KERRIWOM: Yes he's okay now, he just finished an interview with the local media and he's now talking with the lawyers waiting for the arresting officer to arrive from the police station. So at least we were able to get the interview done here in the court premises rather than going down to the police station, which we feared very much, cos you don't know what's going to happen down there.
So, the commissioner was kind enough to allow the chief justice to be interviewed in his office by the arresting officer and that's what's happening, so we're waiting for the arresting officer to arrive.
MEREDITH GRIFFITHS: So are you afraid to leave the chambers at the moment?
NICHOLAS KERRIWOM: Well we're actually waiting for lawyers who are checking on things before they can tell us it's safe to move - so at the moment we're still stuck in the chambers.
MEREDITH GRIFFITHS: What does the chief justice say to the deputy prime minister who is calling for him to resign; what's the chief justice's reaction to that?
NICHOLAS KERRIWOM: We're currently appealing to the deputy prime minister to respect the constitution and allow the courts to function and discharge our constitutional responsibilities without fear or favour.
EDMOND ROY: Justice Nicholas Kerriwom speaking to Meredith Griffiths from his chambers at Papua New Guinea's Supreme Court.- ABC