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Rotomould (Pacific) Ltd v Ministry of Meteorology, Energy, Information, Disaster Management, Environment, Climate Change and Communications [2020] TOSC 114; CV 52 of 2020 (24 December 2020)

IN THE SUPREME COURT OF TONGA
CIVL JURISDICTION
NUKU'ALOFA REGISTRY


CV 52 of 2020


BETWEEN:


ROTOMOULD (PACIFIC) LIMITED Plaintiff


-and-


MINISTRY OF METEOROLOGY, ENERGY, INFORMATION,
DISASTER MANAGEMENT, ENVIRONMENT, CLIMATE CHANGE
AND COMMUNICATIONS ("MEIDECC”) Defendant


-and-


RAJNESH NARAYAN REDDY
t/as M&J Water Tank Company Interested third-party


Application for leave to apply for judicial review


RULING


Before: LORD CHIEF JUSTICE WHITTEN QC
To: Mr W.C. Edwards SC for the Plaintiff
Ms Akau’ola for the Defendant
Mrs Ebrahim for the interested third party
Date of application: 19 November 2020
Date of hearing: 9 December 2020
Date of ruling: 24 December 2020


Introduction

  1. The plaintiff ("Rotomould") seeks leave, pursuant to order 39 of the Supreme Court Rules, to apply for judicial review of a decision by the defendant ("MEIDECC") on 14 September 2020, after a tender process for the supply 1500 water tanks, to award the contract to the interested third-party ("M&J").[1]
  2. The grounds for the application may be summarised as follows:

Background

  1. The application is supported by the affidavit of John Raas Fonua, sworn 19 November 2020. Mr Fonua is the branch manager of Rotomould. In summary, he deposed that:

The CEO concluded by offering to meet with Mr Fonua “to discuss solutions and a way forward”.


(d) On 24 September 2020, Mr Fonua replied to the CEO. He enclosed correspondence that, he said, clearly refuted that M&J and Matrix were partners in the manufacture of water tanks and that Matrix was a supplier of raw materials only. That letter was from the General Manager of Matrix to Jyotsna Chand of Rotomould dated 24 September 2020. It was marked “private and confidential”. The General Manager responded to three questions posed by Mr Chand. The precipitating correspondence from Rotomould, which presumably posed the questions, was not enclosed.
"Matrix Polymers have been a long-standing supplier of rotational moulding polyethylene to (M&J) in Tonga. We supply them many times a year from our manufacturing facility in New Zealand. We would always refer to our customer relationship as a partnership however there is no formal partnership arrangement in place".

(ii) The second question was as to the nature of Matrix’s business, and whether it was a rotational moulder or raw material supplier. The General Manager answered:
“Matrix Polymers is a specialist manufacturer and supplier of raw materials to the rotational moulding industry. We supplied rotational moulders for over 25 years.”

(iii) The third question was whether Matrix had authorised M&J to use, or whether Iatrix had transferred, its AS/NZ 4766 certification for the purposes of M&J's tender. The General Manager answered:
"Matrix Polymers take pride in selling raw materials to the water tank industry that are certified AS/NZ 4766 compliant. We supply proof of certification to all of our water tank industry customers by way of a 3rd party audited certificate (SAI Global in our case). We also supply Certificates of Analysis...for all of our material if requested by our customers. Using AS/NZ 4766 certified materials is one part of a tank manufacturer being accredited for AS/NZ 4766 for their water tanks."

(e) The allegation by M&J that it was in partnership with Matrix and therefore that it met the standard requirements for the manufacture of water tanks was incorrect. The AS/NZS 4766 standard “applied only to raw materials and not to water tanks”.[2] Therefore, M&J did not meet the standard requirements for the manufacture of water tanks.
(f) In relation to MEIDECC’s response about Rotomould’s bid failing to meet the bidding requirements, Mr Fonua said that he produced (presumably to MEIDECC) evidence “about the dimension drawings and hoop stress” to show that those requirements were irrelevant to the manufacture of tanks and not part of the standard requirements.
(g) Mr Fonua attended meetings with MEIDECC representatives in relation to Rotomould's complaints. He provided evidence that MEIDECC had failed to correctly assess the bidding documents and thereby erred in granting the contract for the supply of the water tanks to M&J. He said that Rotomould’s complaints were not answered.
(h) On 28 September 2020, Mr Edwards SC, on behalf of Rotomould, wrote to the CEO of MEIDECC. He referred to a meeting at MEIDECC’s office on 23 September 2020 with members of the assessment committee. Mr Edwards wrote:
"There were two matters which you had advised that the committee took into account in awarding the supply contracts to (M&J). The first point relates to the advice by members of the committee and through your letter dated 18 September 2020 that (M&J) have satisfied the certification of AS/NZS 4766 requirement because M&J is in partnership with Matrix. This independent certification point is incorrect for the following reasons:
1. Matrix Polymer is not in partnership with M&J in the manufacture of water tanks here or elsewhere.
2. Matrix Polymer is not a manufacturer of water tanks but the supplier of raw materials.
3. That the AS/NZS 4766 standards apply only to Matrix Polymer's raw materials but not to the manufacture of water tanks.
4. The AS/NZS 4766 standard for raw materials is not transferable to the manufacture of water tanks in Tonga.
In our view there has been a deliberate misrepresentation made to the committee on the question of certification of standards to mislead the committee. Please note:
  1. Under the standard bidding documents from the office page 6 item 2, if states –
"Bidders should be aware that a bidder who engages in corrupt, collusive, fraudulent, coercive practices will have their proposals rejected and may further be subjected to prosecutions under the laws of Tonga."
  1. This provision under your bidding document appears to have been breached and you are duty bound to take appropriate action to rectify the situation. There appears to be an attempt made in the provision of the false or wrong information as to partnership as an attempt to persuade the committee to award the contract to the successful bidder.
  1. This provision in the bidding document is a serious requirement and one which in our view should be pursued to its logical conclusions.
  1. The attempt by Uaisele to discredit Rotomould's tanks as inferior and substandard immediately raises the question of impartiality. In the discussion we had, it appeared to the writer that Uaisele was determined to eliminate Rotomould as a bidder. The points raised by Uaisele were answered by John Fonua at the time and his answers were later reaffirmed in the email correspondences to your office.
In our respectful view, this is a bad case where there is fraudulent misrepresentation to influence the decision of the committee and award the contract to (M&J).
We invite you to declare the decision of the assessment committee invalid and award the contract direct to Rotomould.
Such action by you would necessarily avoid expensive and protracted litigation with costs payable by the unsuccessful party...."

(i) On 14 October 2020, Mr Edwards again wrote to the CEO of MEIDECC noting that there had been meetings and discussions but that "no final decision has been given as to whether our client's complaint has been rejected or upheld. Further, we would like to know whether you have confirmed the award of the contract to (M&J)." Mr Edwards asked for the CEO's urgent advice.
(j) Rotomould has not received a reply from MEIDECC.
(k) Rotomould had noticed that MEIDECC had started to receive and distribute water tanks from M&J.[3]
(l) Finally, Mr Fonua deposed that the proposed Statement of Claim next to his affidavit was true and correct to the best of his knowledge and understanding.

Proposed Statement of Claim

  1. The proposed Statement of Claim sets out the grounds for the application and the background recited above.
  2. At paragraph 15, further details are pleaded as to the meeting between the parties on 23 September 2020. The particulars detail explanations allegedly given by the MEIDECC representatives for why Rotomould’s bid was non-compliant, such as:
  3. At paragraph 16, it is alleged that later on 23 September 2020, Rotomould emailed MEIDECC information from two independent experts that certified raw material does not mean a water tank is certified, that certification to AS/NZS 4766 level requires more than certified material and that certification of Matrix Polymers is not transferable to M&J.
  4. Paragraphs 20 to 25 are headed "FIRST CAUSE OF ACTION - ULTRA VIRES ACT IN EXCESS OF POWER". Thereunder, Rotomould sets out the legal terms of it complaints which are essentially the grounds for this application. Further, that MEIDECC acted unreasonably in awarding the contract to M&J.
  5. Finally, at paragraph 25, Rotomould pleads that it had a legitimate expectation that the tender process and bid selection would be carried out in accordance with its rules and requirements, whereas MEIDECC failed to carry out the bid selection in accordance with its own criteria when awarding the tender to M&J.
  6. By its prayer for relief, Rotomould seeks:

Consideration

  1. Order 39 of the Supreme Court Rules applies, relevantly, to any action for judicial review against a public body in which the relief claimed includes a declaration or injunction. Rule 2 prohibits any application for judicial review without the leave of the Court. An application for leave is to be made promptly, and in any event, within three months from the date when grounds for the application first arose unless the Court considers that there is good reason for extending that period. Pursuant to rule 3, the Court may grant the application without a hearing, but shall not refuse it without hearing the applicant. The Court shall not grant leave unless satisfied that the applicant has a sufficient interest in the matter to which the application relates.
  2. Judicial review allows the court to exercise a supervisory role over, inter alia, public bodies and tribunals, to ensure that public powers are exercised lawfully: Touliki Trading Ltd v Fakafanua [1995] Tonga LR 8. The grounds upon which administrative action is subject to judicial review have been conveniently classified as ‘illegality’, ‘irrationality’ and ‘procedural impropriety’: Pekipaki v Fifita [2018] TOCA 19 at [29].[4] Material mistake as to an established fact is an accepted ground of review. The decision-maker, in making its evaluation and drawing its conclusions, must proceed upon a correct interpretation of relevant law and must have taken account of relevant considerations and ignored irrelevant considerations. To fail in any of these respects is an error of law. Where, for instance, the information the decision-maker acted upon was clearly incorrect, or where there is a 'misunderstanding or ignorance’ of an established and relevant fact, the decision may be susceptible to being set aside when those conclusions are so clearly insupportable as to amount to an error of law: Tafa v Viau [2006] Tonga LR 125 at [62], Kautoke v Public Service Commission [2019] TOCA 9 at [43], [44].
  3. Sufficient interest is the first and foremost consideration in relation to an application for leave to apply for judicial review. It is a broad and flexible concept.
  4. The Court must be satisfied that there is an arguable case for review. The burden upon the applicant in that regard is not onerous. No in-depth analysis by the Court is required. If, on a quick perusal of the material then available, the Court thinks that it discloses what might on further consideration turn out to be an arguable case in favour of granting to the applicant the relief claimed, it ought, in the exercise of a judicial discretion, grant leave to apply for that relief: Public Service Commission v Public Service Tribunal [2019] TOSC 53.[5]
  5. However, the Court will not grant leave where the case is frivolous, vexatious or hopeless. The purpose of the requirement that leave be obtained is to ensure that an applicant may only proceed to a substantive hearing if the Court is satisfied that there is a case fit for further investigation on a full inter partes hearing: Public Service Association (PSA) v Government of Tonga [2016] TOSC 34 at [10].[6]
  6. Allied to the threshold issue of standing, this application raises an even more fundamental issue as to whether decisions by public authorities in relation to competitive tendering processes are justiciable or amenable to judicial review.

Is the decision justiciable?

  1. The application for leave stated that the plaintiff required a hearing.[7] Subsequently, Mr Edwards filed submissions which included that the request for a hearing was a mistake. He noted Order 39 rule 3(1). Notwithstanding, I directed that the matter be listed for hearing, not pursuant to Rotomould’s erroneous request, but because of the above question of justiciability.
  2. During the hearing, in answer to the question posed, Mr Edwards submitted that MEIDECC’s decision on the tender is justiciable because it was a decision of a government ministry entrusted with responsibility for decisions which affect the public. However, Mr Edwards stated that he was not aware of any previous decision in the Kingdom on an application for judicial review, by an unsuccessful bidder, of a decision by a Government department in relation to a competitive tendering process. My research on published decisions has also revealed none on point.
  3. In principle, all exercises of public power are reviewable, whether the relevant power is derived from statute, prerogative or any other source. However, the courts acknowledge limits, which are reflected primarily in the notions that the case must involve the exercise of a public power, that even if the court has jurisdiction, the exercise of power must be one that is appropriate for review and that relief is, in any event, discretionary: Public Service Association (PSA) v Government of Tonga [2016] TOSC 34 at [23].[8]
  4. The English and Australian courts recognise the need for deference based on a consideration of the status of the decision maker and the nature of the power being exercised.[9] In Council of Civil Service Unions [1985] AC 374, Lord Diplock opined that to qualify as a subject for judicial review, the decision must have consequences which affect some person other than the decision maker, although it may affect him too, and it must affect such other person either:[10]
“(a) by altering rights or obligations of that person which are enforceable by or against him in private law; or
(b) by depriving him of some benefit or advantage which either:
(i) he has in the past been permitted by the decision-maker to enjoy and which he can legitimately expect to be permitted to continue to do until there has been communicated to him some rational ground for withdrawing it on which he has been given an opportunity to comment; or
(ii) he has received assurance from the decision-maker will not be withdrawn without giving him first an opportunity of advancing reasons for contending that they should not be withdrawn.”

United Kingdom

  1. In the United Kingdom, not all decisions of public bodies are (or should be) governed by distinct principles of public law. For instance, when a public authority enters into a contract, the same principles of private law apply as those which govern similar transactions between private corporations, though if in making a contract, a public body acts in an arbitrary or unreasonable manner, or exceeds its statutory powers, its decision may be subject to judicial review. The enforcement of contracts entered into by public authorities is a matter of private law, although the question of whether the authority has power to enter into an agreement, and its reasons for doing so, may be a matter of public law.[11] Similarly, where a local authority exercises statutory powers or duties by contracting out service delivery, and in so doing, contravenes a principle of judicial review (for example, by taking into account an irrelevant consideration) this will usually be a matter of public law.[12]
  2. A statutory body may be amenable to judicial review by reason either of the source from which it derives its power[13] or because it discharges public duties or performs public functions. However, not every act of such a body is of a type which is suitable for judicial review. It is also necessary to consider the closely linked question of the nature of the decision of which complaint is made.[14] The crucial consideration will be whether there is a sufficient public law element to a particular decision. That will involve consideration both of the nature of the decision and the source of the power.[15] It will also be relevant to consider whether the grounds of challenge raise a public law issue.[16] 'The boundary between public law and private law is not capable of precise definition, and whether a decision has a sufficient public law element to justify the intervention of the Administrative Court by judicial review is often as much a matter of feel, as deciding whether any particular criteria are met'.[17]
  3. The process by which a public body determines how to award a contract following a tendering exercise will not ordinarily be subject to judicial review. However, judicial review will be available if there is a specific statutory requirement that the tendering exercise be carried out in a particular way, or where there has been bad faith, or corruption or the contract was awarded pursuant to an unlawful policy.[18]

Australia

  1. In Australia, the learned authors of “Judicial Review of Administrative Action”[19] opine that the common law is in the process of redefining the sorts of activities which are subject to judicial review but that the pressure in Australia is in the English direction, if not, perhaps, to the same extent.
  2. There is some authority for the proposition that an administrative decision may be non-justiciable because it involves consideration by the government of commercial expressions of interest or tenders.[20] However, Australia has also seen some tension between cases regarding the reviewability of government contracting processes. Review at general law may have been influenced by case law which has developed in the context of the Administrative Decisions (Judicial Review) Act 1977(Cth) (the ‘ADJR Act’), where it has been held that commercial decisions made by government decision-makers are nevertheless of an administrative character and hence justiciable under the ADJR Act, provided that other elements of the test of justiciability under that Act are satisfied.[21] The cases, however, are not entirely consistent.[22]
  3. In KC Park Safe (Brisbane) Pty Ltd v Cairns City Council (1997) 1 Qd R 497, in relation to whether decisions relating to tenders made by local government were subject to the rules of procedural fairness, Thomas J said:[23]
"It is well established that when the government (or the Crown) contracts, it exercises its own prerogative powers. Unless some particular statutory system is being applied, the making and breaking of governmental contracts are not matters for judicial review. They are matters for application of the ordinary commercial law...”

  1. However, statutory corporations and bodies which depend entirely upon statutory sources for their powers may stand in a different position from the Crown. Court review of such decisions was available even before Judicial Review legislation if mandatory procedures laid down by legislation for the formation of such contracts were not complied with. For instance, where a statutory office-holder performs the function of providing an independent, impartial and thorough investigation of commercial proposals, rather than merely an evaluation of offers to purchase assets, the resulting decision is justiciable for denial of procedural fairness.[24]
  2. More recently, in Acquista Investments Pty Ltd & anor v The Urban Renewal Authority & Ors [2015] SASCFC 91, the plurality[25] of the Full Court of the South Australian Supreme Court examined a number of the decisions referred to above, and from which, a number of statements of principle may be distilled, including:
  3. In the case before it, the Full Court’s decision that judicial review was not available in relation to the decision to enter into the contract or the contract itself was reinforced by the observation that it was a commercial decision involving wider policy considerations of the kind commonly taken by governments and government instrumentalities and that it is not the role of the Court to assess what weight should be afforded to the desirability of such considerations.

New Zealand

  1. The scope for judicial review of procurement decisions in New Zealand has been described as narrow.[29] Commercial decisions do not become amenable to judicial review simply because they are taken by public entities. Decisions by statutory bodies do not necessarily involve the exercise of statutory power.[30]
  2. However, there is scope for a public law overlay giving rise to judicial review. Even when exercising contractual powers, a public authority is not in exactly the same position as a private citizen. In some instances, a decision taken by the public body cannot be treated as purely in the realm of contract; it may be at the same time a decision governed to some extent by statute. In extreme cases, such as bad faith or capriciousness, Wednesbury unreasonableness, or where the authority had taken into account some impermissible consideration or failed to take into account some mandatory consideration, exercises of contractual powers by public authorities are open to review by the Courts on public law grounds.
  3. In the case of government departments, the fact that they are bound by a government procurement policy may create a legitimate expectation in suppliers that the policy will be adhered to. Policy-based legitimate expectations are most likely to arise as to process but may also affect substantive expectations where it can be shown that the procurement decision is unreasonable in the Wednesbury sense.[31]
  4. The Privy Council has said that it does not seem likely that a decision by a State owned enterprise to enter into or determine a commercial contract to supply goods or services will ever be the subject of judicial review in the absence of fraud, corruption or bad faith: Mercury Energy Ltd v Electricity Corporation of New Zealand Ltd [1994] 2 NZLR 385.
  5. In Lab Tests Auckland Ltd v Auckland District Health Board [2008] NZCA 385; [2009] 1 NZLR 776, it was held that in assessing the standard of judicial review or the scope of the procedural obligations to be applied, it was necessary to look at the nature of the public body, the particular function being performed, the context within which that function was performed, and what it was said had gone wrong. In the case of a contracting decision by a public body in a commercial context, judicial review would be available where there was fraud, corruption or bad faith. It was further held, that as a matter of principle, review might be available in analogous situations such as where an insider with significant inside information and a conflict of interest had used that information to further its interests and to disadvantage rivals in a tender. In such a case, it might be that the integrity of the contracting process had been undermined in the same way as in the case of fraud, corruption or bad faith.
  6. That limited approach was affirmed more recently by the New Zealand Supreme Court, in Ririnui v Landcorp Farming Ltd [2016] NZSC 62; [2016] 1 NZLR 1056. However, the decision under review there, by a state-owned enterprise, involving tenders for the sale of land, was regarded as being reviewable on a broader basis than simply fraud, corruption, bad faith or something analogous. The decision making had not been simply commercial in nature. The decision had a substantial public interest component to it as a result of the context in which the decision-maker operated, and where one of its legitimate activities was to assist the Crown to meet its treaty obligations. The Court considered that where an applicant for judicial review seeks to have a contract set aside in a case where the contracting public body had the capacity to make the contract, the fundamental issue will be the existence and extent of prejudice to third parties. Although relief in judicial review is discretionary, courts today will generally consider it appropriate to grant some form of relief where they find reviewable error. Where there has been a fundamental error by a decision-maker concerning an applicant’s legal status, for which the decision-maker is responsible, a court would usually grant relief by ordering the decision-maker to reconsider on the correct basis. In that case, however, the position was complicated by the fact that there was a concluded agreement for sale and purchase in relation to the land, which raised the question of the circumstances in which a court will be prepared to set aside a contract in judicial review proceedings; and, also that the other contracting party argued that it was an innocent third party which will suffer significant prejudice if the relief sought was granted.

Statutory requirements for MEIDECC’s decision

  1. The approaches of the Commonwealth jurisdictions surveyed above suggest that the question of whether MEIDECC’s decision on the tender process here is justiciable, or amenable to judicial review, requires consideration of a number of factors, including:
  2. The list is not exhaustive. It does, however, provide a starting point in determining this apparently novel question. If Rotomould’s complaints about MEIDECC’s decision are amenable to judicial review, then the public law considerations raised by Rotomould may be examined.
  3. Accordingly, the question calls for some examination of the statutory basis for MEIDECC’s ability to call for tenders and enter into a contract for the procurement of the water tanks as well as any other legislative imperatives for how the tender process was to be conducted and a decision reached, and, if there were, whether any such regulatory requirements had not been complied with. Those considerations or bases for judicial review were not referred to in Rotomould’s application, proposed Statement of Claim or Mr Edwards’ submissions.[32] Counsel for the other parties did not make any submissions on the point.
  4. The statutory genesis and powers of what is now the conglomerate ministry known as MEIDECC are not easily found among Tonga’s legislation. The Attorney General’s website does not contain any indication of how MEIDECC grew from at least one of its original components, the Ministry of Environment and Climate Change. MEIDECC’s own website, which still only refers to itself and its functions in terms of its former incarnation as the ‘Ministry of Information and Communications’, was unresponsive.
  5. The Environment Management Act commenced in 2010. It established (or more correctly, continued) the Ministry of Environment and Climate Change to ensure the protection and proper management of the environment and the promotion of sustainable development. The objects of the Act include to promote the concept of sustainable development in relation to the environment and natural resources of the Kingdom and to facilitate implementation of measures to increase the resilience of the Kingdom and its environment to climate change.[33] The functions of the Ministry prescribed by s.8 include all manner of activity associated with issues affecting the environment and climate change but do not expressly include procurement, although, the omnibus subsection (1)(l) provides that the Ministry shall perform any other act or thing that attains or furthers the objects of the Act. Subsection 2(d) refers to functions relating to desertification and drought relief. While the non-exhaustive list of powers of the Minister specified in s.9 again do not expressly include procurement, the overarching power described in the chapeau to that provision - to do all things necessary or convenient to be done in connection with the functions of the Ministry and in order to attain or further the objects of this Act – arguably includes procurement. Section 10 confers similar powers on the Chief Executive Officer.
  6. On the assumption that water tanks are a measure to combat, at least, desertification and drought relief, then for present purposes, it may be accepted that MEIDECC has statutory power to procure water tanks. It is highly unlikely any of the parties hereto would suggest otherwise.
  7. Section 9(1) of the Public Finance Management Act 2002 prohibits the expenditure of public money unless the expenditure has been authorised by an Appropriation Act limited in accordance with subsection (2) or is statutory expenditure. Section 44 permits the Minister of Finance, with the consent of Cabinet, to make regulations for the proper and efficient administration of the Act.
  8. Such regulations which have been promulgated include, relevantly, the Public Procurement Regulations 2015, as amended by the Public Procurement (Amendment) Regulations 2019, which provide, relevantly:

Conclusion on justiciability

  1. For reasons which should now be apparent, it has not been possible to responsibly determine this application for leave merely on a quick perusal of the material available.
  2. Further, upon consideration and application of the principles as to justiciability considered above, and for the reasons which follow, I am satisfied that it is arguable that MEIDECC’s decision in this case is justiciable and amenable to judicial review:

Leave granted

  1. Although it has been said in a number of the authorities referred to above that the only interests affected by a decision to enter into a contract are the parties to it, I consider that Rotomould’s allegations herein point to conduct which, if ultimately found to be correct, may have affected its rights; alternatively, deprived it of the benefit and and legitimate expectation[34] that the tender process would be conducted lawfully, meaning in accordance with the Regulations and the specific bidding requirements, fairly and reasonably.
  2. I am therefore satisfied that the present is a case fit for further investigation on a full inter partes hearing.
  3. Accordingly, in the exercise of judicial discretion, I grant Rotomould leave to apply for judicial review.

Issues for review

  1. The application, as examined above, reveals a number of issues for review. Some are already articulated in the proposed Statement of Claim; others are not. They will be a matter for Rotomould should it wish to pursue them or any of them by way of amendment to its pleading. The issues include:

whether, pursuant to regulation 56, MEIDECC was required to award the contract to Rotomould;

(k) whether Rotomould pursued all its rights of complaint, review and appeal provided by Part 10 of the Regulations, including referral for review by an Independent Expert, and if not, whether any such failure can or should affect its rights in relation to this proceeding and any relief to be considered;
(l) whether, depending on the outcome to the above issues and subject to any amendment to the Statement of Claim, the Court can and, if so, should, grant any relief in the form of cancelling any contract entered into between MEIDECC and M&J for the supply of the water tanks;

Injunction

  1. Rotomould’s application for an interim injunction cannot be entertained in this application for leave to apply for judicial review.
  2. Firstly, Order 22 rule 1 of the Supreme Court Rules requires an undertaking as to damages. The undertaking is mandatory: Public Service Association (PSA) v Government of Tonga [2016] TOSC 34. Rotomould has not given any such undertaking.
  3. Secondly, in circumstances where Rotomould alleges that M&J started supplying tanks to MEIDECC on or about 20 October 2020, Rotomould waited about a month before issuing these proceedings and did not seek to bring on for hearing a separate application for injunction prior to or at the hearing conducted on 9 December 2020. There is no evidence of urgency in Mr Fonua’s affidavit.
  4. Thirdly, and in the face of the alternative plea for damages, Mr Fonua also did not depose to any irreparable harm should an injunction not be granted.

Result

  1. The application for leave to apply for judicial review is granted.
  2. The Plaintiff has leave to rely upon the Statement of Claim filed 20 November 2020. Alternatively, any Amended Statement of Claim is to be filed by 15 January 2021.
  3. If MEIDECC wishes to participate in the proceeding, rather than simply abide by the determination of the Court, and it opposes the relief sought by Rotomould, it is to file a Statement of Defence by 12 February 2021.
  4. Any Statement of Defence by M&J to the allegations by Rotomould which are relevant to M&J and its interests, is also to be filed by 12 February 2021.
  5. Rotomould has leave to renew its application for an injunction, upon proper material being filed, and upon three days written notice. The matter will be listed for further directions on 19 February 2021.

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NUKU’ALOFA
M. H. Whitten QC
24 December 2020
LORD CHIEF JUSTICE


[1] Whose joinder is necessary: Woolworths New Zealand Ltd v Alcohol Regulatory and Licensing Authority [2020] NZHC 971 referring to Minister of Education v Deluxe Motor Services (1972) Ltd [1989] NZCA 248; [1990] 1 NZLR 27 (CA) at 34.
[2] Paragraph 8. That statement did not seem consistent with Mr Fonua’s earlier descriptions of the standard applying to the manufacture of water tanks. During the hearing, Mr Edwards was unable to clarify the seeming discrepancy.
[3] Since on or about 20 October 2020, according to paragraph 19 of the proposed Statement of Claim.
[4] Referring to Lord Diplock in Council of Civil Service Unions v The Minister for the Civil Service [1985] AC 374, 410.
[5] Citing Flyniu Airlines Ltd v Faletau [2006] Tonga LR 1 and Public Service Association (PSA) v Government of Tonga [2016] TOSC 34 at [9] referring to Moala v Public Service Commission [2012] TOCA 14 and Inland Revenue Commissioner v National Federation of Self-Employed and Small Businesses Limited [1981] 2 All ER 93, 106.
[6] Referring to the White Book, 1991 Edition at 53/1-14/8; Davey v Aylesbury Vale District Council [2008] 2 All ER 178.
[7] [12]
[8] Referring to Elias CJ and Arnold J in Ririnui v Landcorp Farming Limited and others [2016] NZSC 62 at [1].
[9] Cited by Paulsen LCJ in PSA v Government of Tonga, ibid, at [25].
[10] Pages 408-409.
[11] Tesco Stores v Secretary of State for the Environment [1995] 2 All ER 636.
[12] "Judicial Review of Administrative Action" by de Smith, Woolf and Jowell, Sweet & Maxwell, 5th edition, [3-020, 21, 30] referring to R v Avon County Council, ex p. Terry Adams Ltd, The Times, January 20, 1994, on appeal from [1993] C.O.D. 35 (review of tendering for waste disposal contracts).
[13] R v Panel on Take-overs and Mergers, ex p Datafin plc [1986] EWCA Civ 8; [1987] 1 All ER 564 at 583, CA, per Lloyd LJ.
[14] '[T]he susceptibility of a decision to the supervision of the courts must depend, in the ultimate analysis, upon the nature and consequences of the decision and not upon the personality or individual circumstances of the person called on to make the decision': see Leech v Deputy Governor of Parkhust Prison [1988] UKHL 16; [1988] 1 All ER 485 at 512, HL, per Lord Oliver of Aylmerton.
[15] In R (Hopley) v Liverpool Health Authority [2002] EWHC 1723 (Admin) Pitchford J posed a three-stage test: whether the defendant was a public body exercising statutory powers; whether the function being performed in the exercise of those powers was a public or a private one; and whether the defendant was performing a public duty owed to the claimant in the particular circumstances under consideration.
[16] In R (on the application of Molinaro) v Kensington RLBC [2001] EWHC Admin 896 at [65]–]70], [2002] LGR 336, Elias J suggested that the fact that a local authority is exercising a statutory function ought in itself to be sufficient to justify the decision being in principle subject to judicial review; the question then being whether the complaint raises an allegation that power has been abused in breach of any applicable public law principle.
[17] R (on the application of Tucker) v Director General of the National Crime Squad [2003] EWCA Civ 57 at [13]; R (on the application of Simpson) v Chief Constable of Greater Manchester Police [2013] EWHC 1858 (Admin) at [27], [2013] All ER (D). Contrast Colville, Re Judicial Review [2017] NIQB 14. See also R v Hertfordshire County Council ex parte Nupe [1985] IRLR 258.
[18] R v Lord Chancellor, ex p Hibbet and Saunders (a firm) [1993] COD 326, (1993) Times, 12 March; R v Great Western Trains Co Ltd, ex p Frederick [1998] COD 239; Mercury Energy Ltd v Electricity Corpn of New Zealand Ltd [1994] 1 WLR 521; R (on the application of Cookson and Clegg) v Ministry of Defence [2005] All ER (D) 83 (Jun); R (on the application of Gamesa Energy UK Ltd) v National Assembly for Wales [2006] All ER (D) 26 (Aug); R (on the application of Menai Collect Ltd) v Department for Constitutional Affairs [2006] All ER (D) 101 (Apr). Many such tendering exercises are now covered by specific rules in the Public Contracts Regulations 2015, SI 2015/102, and other similar instruments.
[19] Mark Aronson and Bruce Dyer, Law Book Co, 2nd edition, 2000, at p.126.
[20] Cord Holdings Ltd v Burke (1985) 7 ALN N72; White Industries Ltd v Electricity Commission of New South Wales (unreported, SC(NSW), Yeldham J, 20 May 1987, BC8701726)
[21] Neat Domestic Trading Pty Ltd v AWB Ltd [2003] HCA 35; (2003) 216 CLR 277 at [63], [64] per McHugh, Hayne and Callinan JJ; L v South Australia (2017) 129 SASR 180 at [139]-[146] per Kourakis CJ.
[22] Cf Australian National University v Burns (1982) 43 ALR 25; Australian Capital Territory Health Authority v Berkely Cleaning Group Pty Ltd (1985) 60 ALR 284; General Newspapers Pty Ltd v Telstra Corporation (1993) 117 ALR 629.
[23] At 501; referred to in Cubic Transportation Systems Inc & Anor v State of New South Wales & ors [2002] NSWSC 656 at [53].
[24] Century Metals and Mining NL v Yeomans (1989) 40 FCR 564; 100 ALR 383.
[25] Vanstone and Lovell JJ, at [91] ff.
[26] Citing Ainsworth v Criminal Justice Commission (1992) 175 CLR 564, 584.
[27] MBA Landholdings Pty Ltd v Gungahlin Development Authority [2000] ACTSC 89; (2000) 206 FLR 120, in which after a tender process, a decision made to grant a lease was set aside on the basis that the process had not met the requirements of procedural fairness.
[28] Khuu & Lee Pty Ltd v Corporation of the City of Adelaide (2011) 110 SASR 235.
[29] “Public Procurement in New Zealand” by Ian Gault, Bell Gully, Auckland [2005] NZLJ 323.
[30] E.g. New Zealand Stock Exchange v Listed Companies Association Inc [1984] 1 NZLR 699, which makes the distinction between a statutory power and a statutory function.
[31] E.g. Jim Harris Ltd v Minister of Energy [1980] 2 NZLR 294.
[32] Save for a reference at [8] of his submissions to Rotomould’s complaint to MEIDECC being made pursuant to the Public Procurement Regulations.
[33] Section 4(d) and (g).
[34] Flyniu v Ata [2006] Tonga LR 10.


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