State v Transport Control Board, Ex parte Khan [1996] FJHC 118; Hbj0027j.1994s (10 June 1996)

IN THE HIGH COURT OF FIJI
(AT SUVA)
CIVIL JURISDICTION

JUDICIAL REVIEW NO. HBJ0027 OF 1994

BETWEEN:

STATE

V

TRANSPORT CONTROL BOARD AND
PACIFIC TRANSPORT LIMITED

EX-PARTE: MOHAMMED JALIL KHAN

H.K. Nagin for Applicant
J. Semisi for First Respondent
H. Lateef for Second Respondent

Date of Hearing: 4th, 20th December 1995, 19th January, 2nd February, 3rd June 1996
Date of Judgment: 10th June 1996

JUDGMENT

The Applicant seeks Judicial Review of a decision of the First Respondent hereinafter called "the Board" made on the 26th of October 1994 by which it granted the Second Respondent hereinafter called "Pacific Transport" an amendment of its Road Service Licence No. 12/17/12.

The Applicant who trades under the name M.J. Khan Buses and Pacific Transport is a bus service operator in the Lautoka area. The Applicant's operations are confined to the Lautoka area where he has been operating buses under Road Service Licence No. 12/18/23 for several years.

Pacific Transport is a limited liability company having its registered office at Suva in Fiji and operates long distance bus services between Suva and Lautoka and also operates bus services within the Lautoka area.

The Applicant seeks Judicial Review of the Board's decision of the 26th of October 1994 and an order for certiorari to quash that decision on various grounds, the principal of which are -

(a) That the Board acted unfairly in granting the amendment of Pacific Transport's Road Service Licence No. 12/17/12 when that company had expressly agreed that only the Applicant should be allowed to operate in the Chameli Park Area of Lautoka.

(b) That the Board abused its discretion under the Traffic Act in that -

(i) it took into consideration irrelevant matters;

(ii) it did not take into consideration relevant matters;

(iii) it failed to follow its own guidelines;

(iv) it wrongly allowed Pacific Transport to breach its agreement and undertaking.

(c) The Board acted contrary to the legitimate expectations of the Applicant.

The following facts are not in dispute: In 1977 the Transport Officer Higher Grade (Western) Mr. Jennings who was an officer of the Transport Control Board took the Applicant and Mr. Surend Prasad, the Manager at the time for Pacific Transport and another person Suresh Autar of Highland Transport to the area known as Tavakubu Creek in Lautoka. There Mr. Jennings divided the area between the Applicant and Pacific Transport which meant that the Applicant was to operate on one side of Tavakubu Creek and Pacific Transport was to operate on the other side of the creek. It was agreed that there would be no encroachment in each other's area of operation.

At the meeting of the Board held on 30th April 1985 a Mr. Bob Lateef appearing for Pacific Transport advised the Board that Pacific Transport would not object to the Applicant operating in the Chameli Park Area when the road there was completed. At the request of the Chairman of the Board Mr. Lateef on behalf of Pacific Transport Limited undertook and agreed not to object to an application that the Applicant would lodge in respect of the Chameli Park Area.

The road in the Chameli Park Area was completed in December 1993 and on the 7th of December 1993 the Applicant lodged an application for amendment of his Road Service Licence to extend his trips to the Chameli Park Area.

On the advice of the Board the Applicant wrote to Pacific Transport Limited on 28th December 1993 asking it to confirm the earlier agreement by Pacific Transport's lawyer Mr. Lateef that Pacific Transport would not object to the Applicant extending his route.

Pacific Transport did not respond to this letter.

On the 4th of March 1994 Pacific Transport also applied for amendment to its Road Service Licence No. 12/17/12 to operate additional trips from the Chameli Park Area whereupon the Applicant lodged his objection to that application.

On the 6th of May 1994 the Board granted the Applicant permission to operate in the Chameli Park Area on a temporary basis under Section 74 of the Traffic Act. Two weeks later Pacific Transport was also granted a temporary licence under Section 74 to operate additional trips from the Chameli Park Area.

As soon as the Applicant discovered that a temporary licence had been granted to Pacific Transport, he immediately instructed his solicitors to write to the Board complaining about such licence.

At the Board's meeting on 26th October 1994 Pacific Transport's lawyer Mr. Haroon Lateef agreed to withdraw its objection against the Applicant's application but did not agree to withdraw Pacific Transport's application. The Chairman of the Board suggested to Pacific Transport Limited that perhaps it should withdraw its application and allow the Applicant only to operate in the Chameli Park Area. Pacific Transport did not agree to this whereupon the Board after hearing submissions on behalf of the Applicant and Pacific Transport granted both the applications namely the Applicant's application for amendment of RSL 12/18/23 and Pacific Transport's application for amendment of RSL 12/17/12.

There is no dispute that at the hearing on the 26th of October Pacific Transport submitted to the Board that there were 10 schools as well as the Lautoka Hospital on its route and the public in the area would benefit by having both services.

Against this the Applicant contends that the area in question is not very big and that at present there are only 30 to 40 houses which means the population is not large enough to sustain two bus operators.

In addition to the affidavits filed on behalf of the Applicant and Pacific Transport the Board has filed an affidavit by its current Secretary, Gianeshwar Chandra Naidu. Mr. Naidu states that the Board admits that the Applicant and Pacific Transport agreed in 1977 in the circumstances alleged by the Applicant that the area in question was divided between the two operators and that there would be no encroachment in each other's area of operation. However Mr. Naidu says that Pacific Transport never gave the Board any undertaking that it would not apply to operate in the area when the road was completed.

Mr. Naidu also denies an allegation by the Applicant that the Board's guidelines indicate that the Board would prefer to extend existing trips rather than grant new trips. I find this statement somewhat strange because in guideline 1(c) of the guidelines exhibited to the affidavit of the Applicant in support of his application it is stated "whenever possible the Board will try to extend the existing trip to cater for such needs rather than give new trip altogether". Having heard numerous applications for Judicial Review in which the Board's guidelines have been mentioned, it has always been my understanding and indeed has always been agreed by counsel, that over the years since 1989 the Board's policy has been to endeavour to extend existing trips rather than grant new trips.

Mr. Naidu also deposes that one of the Board's foremost criteria for considering an application for a Road Service Licence or an amendment for additional trips is the need of the area. With respect to Chameli Park Area, Mr. Naidu says that this is a newly developed area where there was no bus service available to the travelling public before the Board granted the two applications herein. Finally he states that the Board's decision was reached from the evidence and submissions made to it on 26th October 1994 in accordance with the Board's guidelines and the provision of the Traffic Act. He therefore says that this Court ought not to grant the reliefs sought by the Applicant.

I have received helpful written and oral submissions on behalf of the Applicant and Pacific Transport and shall refer briefly to these now.

The Applicant contends that in view of the history of the matter the Applicant had legitimate expectations that the Applicant only would be granted a licence to operate in the Chameli Park Area in accordance with his application. Counsel refers to guideline 1(b) and the whole of guideline 1(c) of the Board's guidelines. Guideline 1(b) reads:

"Applications by outside operators into an existing operator's areas of operation will not be granted unless part of the route of the proposed application falls on the route or part of the route of an existing operator as a consequence thereof and no alternative routing is possible or the existing operator is unable to provide adequate and efficient service in the area."

Guideline 1(c) reads in full:

"Application for new route will not be granted unless it is absolutely necessary or desirable in the public interest with the minimum effect on other operators. Whenever possible the Board will try to extend the existing trip to cater for such needs rather than give new trip altogether."

The Applicant submits that by granting both licences the Board has been unfair to the Applicant. The Applicant further contends that the Board obviously did not take into consideration relevant matters because if it had it could not have granted licences to both the Applicant and Pacific Transport to operate in the Chameli Park Area. It is said that even if, as Pacific Transport depose, there are at present 100 houses in the area and not the 30 or 40 claimed by the Applicant, this does not constitute sufficient population to sustain two bus companies operating in the area. Furthermore the Applicant submits that the Board did not give any reasons for its decision when in all the circumstances here it might have been expected that it would on the alleged ground that usually two operators are not given licences to operate in the same area. Counsel then refers to various cases and authorities on this question and I shall discuss these later.

In reply to these submissions Pacific Transport claims that its additional trips in the Chameli Park Area cannot affect the Applicant because a perusal of a map showing the former and additional routes of both operators in the area annexed to the first affidavit by the Applicant shows that both the Applicant and Pacific Transport take totally different routes to Lautoka Bus Station from Chameli Park.

Pacific Transport then submits that it did not give any undertaking not to apply for a Road Service Licence in the area but simply not to object to the Applicant applying for a licence in that area.

Counsel for the Applicant describes this submission as 'Double Dutch', but I think it would be better described as 'Double Talk'.

It is further submitted that in granting both licences the Board was satisfied that there was need and that it was absolutely necessary and desirable that the settlement in Chameli Park should have services in the area also operated by the Second Respondent.

The law on legitimate expectations has developed during the last 10 to 15 years. Thus in what is known as GCHQ case, Council of Civil Service Unions v. Minister for the Civil Service (1985) AC 374 Lord Fraser's speech has frequently been relied upon. His Lordship said that a legitimate expectation may arise either from an express promise given by a public authority or from the existence of a regular practice which the claimant can reasonably expect to continue.

Bingham L.J.'s judgment in R. v. Board of Inland Revenue, ex p MFK Underwriting Agencies Ltd (1990) 1 ALL E.R. 91 at pp. 110-111 is also cited. His Lordship said:

"If a public authority so conducts itself as to create a legitimate expectation that a certain course will be followed it would often be unfair if the authority were permitted to follow a different course to the detriment of one who entertained the expectation, particularly if he acted on it. If in private law a body would be in breach of contract in so acting or estopped from so acting a public authority should generally be in no better position. The doctrine of legitimate expectation is rooted in fairness. But fairness is not a one-way street. It imports the notion of equitableness, of fair and open dealing, to which the authority is as much entitled as the citizen."

In Wades Administrative Law, 6th Edition at pp 423 and 424 the Doctrine of legitimate expectation is also discussed. The author refers to what he calls some "revealing decisions of the English Courts" which have held that inconsistency of policy may also amount to an abuse of discretion, particularly when undertakings and statements of intent are disregarded unfairly or contrary to the citizen's legitimate expectations. The author says that the Courts now expect government departments to honour their published statements or else to treat the citizen with the fullest personal consideration.

In this case it is agreed that the Board gave no reasons for granting both licences although counsel for Pacific Transport says that this Court may assume that the Board considered there was sufficient need for two services. I find this submission unsatisfactory on the facts of this case. It is not denied that the Applicant and Pacific Transport agreed that Pacific Transport would not oppose the Applicant's application for Chameli Park. The Board knew of this agreement so that when in practical terms it granted Pacific Transport's application also to operate in that area I consider the Applicant was entitled to feel aggrieved and to at least be given reasons by the Board why it was allowing two operators to serve the area in the face of the earlier agreement that only the Applicant should do so.

In my unreported judgment of Judicial Review No. 2 of 1991 Sydney Wright v. Minister for Immigration delivered on 21st November 1991 I referred at pp 19 and 20 to the law then developing on the desirability of Arbitration Tribunals giving reasons for their decisions where possible. I quoted from Professor Wade again in his 6th Edition at p.547 as follows:

"Nevertheless, there is a strong case to be made for the giving of reasons as an essential element for administrative justice. The need for it has been sharply exposed by the expanding law of judicial review, now that so many decisions are liable to be quashed or appealed against on ground of improper purpose, irrelevant considerations and errors of law of various kinds. Unless the citizen can discover the reasoning behind the decision, he may be unable to tell whether it is reviewable or not, and so he may be deprived of the protection of the law. A right to reasons is therefore an indispensable part of a sound system of judicial review. Natural justice may provide the best rubric for it, since the giving of reasons is required by the ordinary man's sense of justice. It is also a healthy discipline for all who exercise power over others. 'No single factor has inhibited the development of English administrative law as seriously as the absence of any general obligation upon public authorities to give reasons for their decisions.'"

Later he states:

"Although there is no general rule of law requiring the giving of reasons, an administrative authority may be unable to show that it has acted lawfully unless it explains itself.... Although there may be difficulties in formulating suitable rules and the arguments are not all on one side, there is no doubt that the lack of a general duty to give reasons is an outstanding deficiency of administrative law."

In a report entitled "Justice All Souls Review of Administrative Law in the United Kingdom", the inquiry chaired by Sir Patrick Neill Q.C. said this:

"'No single factor has inhibited the development of English administrative law as seriously as the absence of any general obligation upon public authorities to give reasons for their decisions.' It is generally believed that the quality of tribunal decision making has improved since the imposition of the duty on tribunals in 1958."

Whilst I agree that often it will be unnecessary for the Transport Control Board to give reasons for its decisions because the basis on which the Board gives its decisions on particular cases will be clear from the facts of the cases, I do not consider the instant case falls into that category. The Board knew of the agreement between the Applicant and Pacific Transport and had endeavoured to give effect to that agreement.

This is evidenced by the claim by the Applicant, accepted by Mr. Naidu in his affidavit, that at the Board's meeting on the 26th of October 1994 the Chairman "indicated to Pacific Transport Limited that perhaps they should withdraw their application and allow him to operate in this Chameli Park Area".

It is now conceded by counsel for Pacific Transport that the statement in paragraph 5.1 of his submission that the Board considered the need of the area and the desirability of the service before it granted the licence to Pacific Transport is purely presumption. It would have been a simple matter for the Board in this, and I believe in most other cases before it, to have said when announcing its decision words to the effect that "the Applicant's or Respondent's submissions are accepted by the Board and a licence is granted or refused accordingly". Nothing even remotely resembling that was done in the present case.

I therefore uphold the Applicant's request for Judicial Review on both grounds submitted to me namely that the Applicant here had a legitimate expectation that he would be allowed to operate without a competitor in the Chameli Park Area and that he was entitled to at least have short reasons from the Board as to why it granted Pacific Transport's application as well.

The orders of the Court will be:

(1) that certiorari will go to remove the decision of the Transport Control Board made on the 26th of October 1994 into this Court and that the same is hereby quashed;

(2) that the Respondent pay the Applicant his costs.

(JOHN E. BYRNE)
J U D G E

Legislation and authorities referred to in Judgment:

Traffic Act Cap. 176.
Council of Civil Service Unions v. Minister for the Civil Service (1985) AC 374
R. v. Board of Inland Revenue, ex p MFK Underwriting Agencies Ltd (1990) 1 ALL ER 91.
Judicial Review No. 2 of 1991 Sydney Wright v. Minister for Immigration - unreported Ruling of Byrne J. dated 21st November 1991.
Administrative Law by H.W.R. Wade 6th Edition.

The following additional authorities were cited in argument:

Grahame Aldous and John Elder - Applications for Judicial Review, Second Edition.
Akbar Buses Limited v. TCB - Civil Appeal No. 9 of 1984.
FPSA v. Registrar of Trade Unions - FCA Civil Appeal No. 7 of 1993.
Halsbury's Laws of England Volume 1(1) paragraph 81.
Padfield v. Minister of Agriculture, Fisheries and Food [1968] UKHL 1; (1968) AC 997.

HBJ0027J.94S