Fiji Television Ltd v Minister for Communications, Works & Energy [1998] FJHC 52; Hbj0039.1997 (22 April 1998)

Fiji Islands - Fiji Television Ltd v The Minister for Communications, Works and Energy - Pacific Law Materials

IN THE HIGH COURT OF FIJI

AT SUVA

CIVIL JURISDICTION

JUDICIAL REVIEW NO. HBJ0039 OF 1997

of an application by FIJI TELEVISION LIMITED
for Judicial Review Under Order 53 of the High Court Rules 1988
and the High Court (Amendment) Rules 1994

AND

IN THE MATTER of a decision of the
PERMANENT SECRETARY FOR COMMUNICATIONS, WORKS AND ENERGY

BETWEEN:

FIJI TELEVISION LIMITED
Applicant

AND:

MINISTER FOR COMMUNICATIONS, WORKS AND ENERGY
Respondent

J. Howard for the Applicant
E. Walker for the Respondent

Dates of Hearing and Submissions: 12th December, 1997, 19th and 29th January 1998.
Date of Interlocutory Judgment: 22nd April 1998

INTERLOCUTORY JUDGMENT ON APPLICATION FOR LEAVE
TO APPLY FOR JUDICIAL REVIEW

This is another Chapter in the continuing saga (or perhaps the better word for it is "conflict") between the Government represented in this action by the Minister for Communications, Works and Energy and in Action HBJ No. 12 of 1997 State v. Minister for Information, Broadcasting, Television and Telecommunications Ex-parte: Fiji Television Limited by the Minister for Information, Broadcasting, Television and Telecommunications.

The latter proceedings concern the decision of the Minister for Information of 18th April 1997 to revoke the exclusivity of the licence held by the Applicant under the Television Decree 1992.

The present proceedings concern the decision of the Permanent Secretary for Communications, Works and Energy made on the 6th of October 1997 on behalf of the Minister for Communications, Works and Energy to increase the licence fee of the Applicant to $250,000.00 plus $25,000.00 VAT with effect from 24th June 1998.

Background

1. Under an Agreement and Television Broadcast Licence dated 1st July 1994 the Government granted the Applicant an exclusive licence to establish and operate a television station.

2. Under Clause 3.1 of the Agreement between the Applicant and the Government the Television Broadcast Licence fee payable by the Applicant is $1,000.00 plus 10% VAT. Under Clause 3.2 of the Agreement the licence fee payable may be adjusted without the Applicant's agreement on the fourth, seventh and thirteenth anniversary of the commencement date.

3. On 6th October 1997 the Respondent wrote to the Applicant advising it of his intention to increase the licence fee to $250,000.00 plus 10% VAT. No consultation with the Applicant or prior notice took place before service of the notice of intention to increase the fee. No reasons were given in the Respondent's letter for the proposed increase, which expressed as a percentage represents an increase of 24,900%.

4. By letter dated 9th October 1997 the Chairman of the Applicant wrote to the Minister for Communications, Works and Energy stating that it rejected the purported adjustment of the licence fee on the grounds of illegality. Neither the Minister nor the Respondent replied to this letter but (and this is not disputed) the Minister for Communications Mr. Kubuabola was reported as stating in the Daily Post newspaper of 22nd October 1997 that the Government would not change its mind on the increase in licence fee payable by the Applicant.

Relief Sought

As a result of the foregoing on the 5th of November 1997 the Applicant made its present application for leave to apply for Judicial Review in the form of:

1. Certiorari to quash the decision of the Respondent;

2. A declaration that the Respondent's decision in adjusting and increasing the fee is:

(i) unlawful;

(ii) in breach of the rules of natural justice;

(iii) unreasonable; and

(iv) unconscionable.

The Applicant also seeks an order for mandamus directing the Respondent to reconsider the matter and to exercise the discretion vested in him under Clause 3.2 of the Agreement properly and according to law.

The Applicant also seeks an injunction to restrain the Respondent from giving effect to its decision to raise the licence fee to $250,000.00 plus 10% VAT.

Grounds on which Relief is sought

The Applicant lists four grounds:

1. The Respondent did not exercise his discretion properly and according to law when he increased the licence fee pursuant to Clause 3.2 of the Agreement.

2. The Respondent abused his discretion and failed to observe the rules of natural justice when he exercised his discretion under Clause 3.2 of the Agreement.

3. Given the magnitude of the purported increase in the licence fee the Applicant was entitled to be heard beforehand and to make representations to the Respondent on why he should not give effect to his decision.

4. The Respondent's decision was such that no person or body properly directing itself on the relevant law and acting reasonably could have reached that decision.

Although the letter advising the Applicant of the decision was signed by a government functionary, very sensibly in my view the Respondent does not dispute that the power to increase or otherwise vary the licence fee rests with the Minister. Thus the Respondent, again very sensibly, does not dispute that it is reasonable to infer that the decision was taken following consultation with the relevant Minister. Consequently, the decision challenged is that of the Minister.

The Respondent opposes leave being given although I find his submissions somewhat curious. In paragraph 1 of his submissions the Respondent states, "That leave should be refused because the Application includes a contractual cause of action which is not appropriate for Judicial Review." Later however in paragraph 6 the Respondent states, "The Respondent does not contest that the decision is an appropriate one for Judicial Review". It would therefore be easy for me to give leave to apply and say no more but I do not propose to take this course, even though I should say immediately that I do consider the decision is reviewable judicially, because of the overall tenor of the Respondent's general submissions which raise important questions of law.

Put simply the Respondent argues that Judicial Review should not issue in this case because the Respondent has increased the licence fee under the licence or contract. That being so, it is said, this is a matter of private law and therefore removes the decision taken from the arena of public law. Thus the Respondent says the decision is not reviewable.

In support of his submissions the Respondent refers to well-known authors on Judicial Review first in the person of Professor Wade, Administrative Law, 7th Edition p.663 where the author says:

"Contractual obligations belong to private law, so that where the only rights asserted are covered by such obligations, judicial review will be refused."

Similarly in Lewis "Judicial Remedies in Public Law" the author states:

"Judicial review is concerned with the protection of rights derived from public law. Judicial review is not however available to enforce private law rights. Such rights can only be enforced by way of an ordinary action for damages, a declaration, or an injunction."

Counsel for the Respondent then refers me to two cases:

1. Law v. National Greyhound Racing Club Ltd. [1983] EWCA Civ 6; (1983) 1 WLR 1302.

2. R. East Berkshire Health Authority Ex-parte: Walsh [1984] EWCA Civ 6; (1985) Q.B. 152.

In my judgment both these cases are distinguishable on the facts from those in the instant case. Law's case related to the attempted Judicial Review of a decision of the Stewards of the company charged with the conduct and discipline of greyhound racing in the United Kingdom. The Court of Appeal held that a declaration by the Stewards suspending a trainer's licence contained no element of public law which entitled it to be the subject of Judicial Review.

Walsh's case concerned the dismissal of a nurse by an English health authority which the Court of Appeal held was not judicially reviewable on the ground again that there was no element of public law involved or as the Court put it, no statutory "underpinning" of the employment relationship.

Again that case is distinguishable on its facts from the present.

In my judgment the Respondent's submissions on this are too simplistic in that they fail to take into account the provisions of the Television Decree, the scheme of that Decree and the nature of the powers being exercised by the Minister and the "mixed character" of the licence which has been granted to the Applicant.

Section 4 of the Decree empowers the Minister to issue a Television Broadcasting Licence containing such terms and conditions as he may determine to any person. Sub-section 4 empowers the Minister to require payment of a licence fee of such amount as the Minister may determine.

If the Respondent's arguments are correct then it would follow in my view that any exercise of a ministerial discretion under Section 4 or indeed any other part of the Decree, no matter whether it be unlawful, unreasonable or ultra vires the Decree, can not be challenged in a court of law because the Minister has purported to act in accordance with such a contractual undertaking. I know of no legal authority, nor has any been cited to me, to support the proposition that where a Minister of State exercises a statutory power which results in the grant of a licence which may contain many if not all of the attributes of a contract to do something, the exercise of that ministerial discretion is not subject to review.

In my judgment that cannot be right. Here the Minister was at the material time exercising public law functions and statutory powers. He is the holder of a public office. Therefore the exercise by him of any discretionary power under the Television Decree must be governed by the purposes of that Decree and any restrictions or powers expressed or implied vested in him under the Decree and that power must necessarily be subject to relevant public law principles, for example he must exercise it reasonably, lawfully, and in the public interest. Put another way this means that he must not act arbitrarily, capriciously or in bad faith. If he failed to do so then in my opinion any person aggrieved or adversely affected by the exercise of the power would be entitled to have recourse to Judicial Review.

Put shortly this means that the Court must be allowed to look at the reality of the situation and not be governed in its decision by considerations of whether the document in question contains certain provisions which may well appear in private contracts and so constitute a contract.

It is vital in my judgment to remember that the licence in question here has as its source the Television Decree and in particular Section 4 thereof. It matters not in my view that the Minister or his agent has entered into a commercial arrangement through a contract or a licence if that document is based on a statute or in this case a Decree. Thus in applications for Judicial Review 2nd Edition by Aldous and Alder p.112 the authors state:

"Even where a power is essentially contractual, the presence in a given case of an additional statutory element or even the exercise of a general governmental policy might possibly convert a contractual private law issue into one of public law."

The Applicant submits that the Minister's decision, even if pursuant to a contract, is nevertheless open to review.

I do not entirely agree with that statement because if the matter was simply one of contract one would presume that the parties entered into their contract with open eyes and that if the contract gave, as the licence does here, an apparently unlimited discretion to the other party to increase the licence fee to any amount the other party decided then the Court might well hold that the party affected by any huge increase in the fee should have seen fit to insert in the contract a clause limiting the amount of any increase according to an agreed formula. If it did not do so then arguably it would be obliged to accept any increase, no matter how high.

I find it unnecessary however to say any more about this because I am satisfied that the licence in this case is not a mere private contract but an agreement based on a statutory instrument namely a Decree made by the then Government of the country and having the full force of law. As such in my judgment any decision made by a relevant authority clearly acting under the Decree is subject to Judicial Review by the Courts.

In Professor Wade's Administrative Law in the 6th Edition at p.39 and in the 7th Edition at p.41 the author says:

"It is a cardinal axiom....that every power has legal limits, however wide the language of the empowering Act. If the court finds that the power has been exercised oppressively or unreasonably (emphasis added), or if there has been some procedural failing, such as not allowing the person affected to put forward his case, the act may be condemned as unlawful. Although lawyers appearing for government departments often argue that some Acts confer unfettered discretion, they are guilty of constitutional blasphemy. Unfettered discretion cannot exist where the rule of law reigns. The notion of unlimited power can have no place in the system. The same truth can be expressed by saying that all power is capable of abuse and that the power to prevent abuse is the acid test of effective judicial review."

Judicial Review is available to protect rights that are derived from public law and I have no doubt that this licence is so derived. At p.40 of his 6th Edition Professor Wade says this:

"One of the law's notable achievements has been the development of the principles of natural justice, one of which is the right to be given a fair hearing before being penalised in any way. These principles are similarly based upon implied statutory conditions: it is assumed that Parliament, when conferring power, intends that power to be used fairly and with due consideration of rights and interests adversely affected. In effect, Parliament legislates against a background of judge-made rules of interpretation, which place the necessary restrictions on governmental powers so as to ensure that they are exercised not arbitrarily but fairly and properly."

In my judgment on the facts as so far known it is open to the Applicant to argue that the Minister's decision here was arbitrary and capricious.

At this stage the onus is on the Applicant only to satisfy the Court that it has an arguable case and I am satisfied that it has. The position is that of a Minister of State exercising discretionary authority which on the face of it is unreasonable and oppressive. For the Minister to increase the licence fee by 24,000% which the Applicant has indicated it will vigorously oppose is to my mind prima facie evidence of gross unreasonableness and capriciousness.

In his book Judicial Remedies in Public Law by Clive Lewis 1992 the author states at p.53:

"The courts have been prepared to superimpose public law principles onto contractual situations, and to ensure the observance of those principles by way of judicial review. They are prepared to do this even if the effect of granting a public law remedy is to vary the rights existing under a contract as for example, where a decision to terminate a contract is quashed and the contractual provisions then revived."

For these reasons I consider the Applicant should be given leave to apply for Judicial Review of the decision in question and I so order.

JOHN E. BYRNE
JUDGE

Authorities and legislation referred to in judgment:

Television Decree 1992.

Wade's Administrative Law 6th and 7th Editions.

Applications for Judicial Review - Aldous & Alder.

Judicial Remedies in Public Law - Clive Lewis 1992.

Law v. National Greyhound Racing Club Ltd. [1983] EWCA Civ 6; (1983) 1 WLR 1302.

R. v. East Berkshire Health Authority Ex-parte: Walsh [1984] EWCA Civ 6; (1985) Q.B. 152.

The following additional cases were referred to in argument:

Commissioner of Customs and Excise v. Cure and Deeley Ltd. (1962) 1 Q.B. 340.

Davey v. Spelthorne Borough Council [1983] UKHL 3; (1984) A.C. 262.

Congereve v. Home Office (1976) Q.B. 629.

Padfield v. Minister for Agriculture, Fisheries and Food [1968] UKHL 1; (1968) A.C. 997.