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IN RE LOCAL AUTHORITIES HOUSING STATUTENO. 2 OF 1995 OF THE PROVINCIAL COUNCILNORTH CENTRAL PROVINCE
SUPREME COURT.
FERNANDO. ACJ..
WIJETUNGA, J ANDANANDACOOMARASWAMY, J.
S.C. NO. 16/97 (S.D.)
SEPTEMBER 24.1997.
Constitutional Law – Provincial Council Statute – Constitutionality – Item 4.3 List I(Provincial Council List) Ninth Schedule to the Constitution – Local Government -Local Authorities Housing Act – Article 154G (8) of the Constitution.
Section 4(1) o! the Local Authorities Housing Statute No. 2 of 1995 made by theProvincial Council of the North Central Province compelled a Local Authority togift to a tenant of a house which had been let in terms of section 3(1) of the LocalAuthorities Housing Act No, 14 of 1964 as amended by Act No. 63 of 1979 wherethe rental of such house prior to such letting did not exceed one hundred and fiftyrupees as on 01.01.1991. Section 4(2) of the Statute compelled gift of similarhouses let otherwise than under the Provisions of section 3(1) of Act No. 14 of1964.
Held:
Sections 4(1) and 4(2) and the long title of the Local Authorities Housing StatuteNo.2 of 1995 are inconsistent with the Constitution in that:
The provisions of sections 4(1) and 4(2) compelling gifts of housesdiminished the power of a local authority in derogation of the constitutionalprohibition against taking away the powers of a local authority, imposed on aProvincial Council by section4.3. of List I (Provincial Council List) in the NinthSchedule to the Constitution.
Although the statute was inconsistent with the Local Authorities Housing Act.it failed, contrary to Article 154G(6) of the Constitution, to describe the Statutein its long title as being inconsistent with that law.
Reference under Article 154 H(4) of the Constitution.
K.C. Kamalasabaysan, PC. A.S.G. with N. Pulle, S.C. for the Attorney-General.
C. Seneviratne, PC. with D. H. N. Jayamaha and H. V. Situge for the Chairmanand the Chief Minister of the Provincial Council of the North Central Province.
Cur. adv. vult.
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Provincial Council North Central Province (Fernando. ACJ)
345
September 26.1997.
FERNANDO, ACJ:
This is a Reference under Article 154H(4) of the Constitution.
The Reference states that the Provincial Council of the NorthCentral Province made a Statute entitled the “Local AuthoritiesHousing Statute, No 2 of 1995"; that upon being presented to theGovernor for his assent in terms of Article 154H{2), the Governorreturned that Statute to the Provincial Council for reconsideration, onthe basis that it was not within the legislative competence of theProvincial Council; that the Provincial Council having reconsideredthe Statute passed it a second time without amendment; and thatwhen presented to the Governor for a second time for his assent, theGovernor reserved the Statute for reference by the President to thisCourt for a determination that it is not inconsistent with the provisionsof the Constitution.
Notice was issued by this Court on the Attorney-General, andthereafter on the Governor, the Chief Minister and the Chairman of theProvincial Council, Written submissions were tendered on behalf ofthe Attorney-General, the Chief Minister and the Chairman.
Mr. Kamalasabayson, PC, ASG, submitted that the Governor hadwithheld assent because the Statute was inconsistent with theConstitution for two reasons only.
First, sections 4(1) and 4(2) of the Statute are inconsistent withitem 4.3 of List I (the Provincial Council List) in the Ninth Schedule tothe Constitution, because they took away a power which localauthorities has under the Local Authorities Housing Act, No 14 of1964, as amended by Act No 63 of 1979, despite the expressprohibition in item 4.3;
“4. Local Government4.3 Local authorities will have the powers vested in them under
existing law
It will be open to a Provincial Council to confer additional powerson local authorities but not to take away their powers."
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Second, although the Statute is inconsistent with the LocalAuthorities Housing Act, it fails – contrary to Article 154G(8) of theConstitution – to describe the Statute 'in its long title as beinginconsistent with that law'.
Section 3(1) of the Local Authorities Housing Act (“the Act")provides:
"… a local authority may, either upon a resolution passed in thatbehalf at a duly constituted meeting of that local authority or uponthe direction of the Minister, let to any person any house.
which has vested in that local authority under section 2; or
which has been, or may be, constructed by that local authoritywithin the administrative limits of that local authority for thepurpose of residence,
on such terms as will enable that person to become the owner ofthat house and the land appertaining thereto after making certainnumber of monthly payments as rent.”
Section 4 of the Statute provides:
“(1) Where prior to the coming into force of this Statute a house towhich the Local Authorities Housing Act applies has been letto any person under the provisions of section 3(1) of that Actand the monthly rental of such house prior to such letting didnot exceed one hundred and fifty rupees as at 01.01.1991,the local authority within the administrative limits of which thathouse is situated shall, by an instrument of disposition,transfer, free of charge, that house to that person.
(2) Where prior to the coming into force of this statute a house towhich the Local Authorities Housing Act applies has been letto any person otherwise than under the provisions of section3(1) of that Act and the monthly rental of that house did notexceed one hundred and fifty (rupees), the local authoritywithin the administrative limits of which that house is situatedshall, by an instrument of disposition (transfer that house?)
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to the tenant of that house who is in occupation thereof onthe date of coming into force of this Statute; or
to the person in occupation of that house on the date ofcoming into force of this Statute, where the tenant of thathouse is not in occupation thereof on that date,
if, and only if, the Advisory Board constituted for that localauthority is satisfied that…
1. It is clear that section 3(1) of the Act conferred a power on alocal authority – in its discretion – to let to any person a house(either vested in it or constructed by it) on rent-purchase terms.By providing that the local authority “may” let any such house, itwas made clear that it had the power to let, but was under noobligation to let, any such house. If it exercised that power tolet, it had the power to stipulate monthly rent-purchasepayments; and it also had the right to receive the stipulatedpayments and the power to enforce that right. If section 4(1) ofthe Statute came into operation, while it is true that it would notaffect future lettings by a local authority under section 3(1) ofthe Act, yet in respect of all past lettings, a local authority wouldbe compelled to gift to the tenant every such house, whosemonthly rental was less than Rs. 150. The imposition of thatobligation to gift every such house would immediatelyextinguish the rights and powers which the local authority hadpreviously enjoyed in respect of future monthly paymentsreceivable in respect of such houses. Its powers would thus betaken away, and that a Provincial Council cannot do, because ofthe constitutional prohibition contained in item 4.3 of List 1.
Section 4(2) of the Statute is open to a like objection. Where a localauthority let a house owned by it, otherwise than under section 3(1) ofthe Act, it had the power to stipulate the rental, and thereupon theright and power to receive the agreed rentals. It was under noobligation to forego such rentals. By imposing an obligation to giftsuch houses to the tenants, section 4(2) of the Statute would takeaway those rights and powers.
Mr Kamalasabayson, PC, ASG, submitted that there would havebeen no inconsistency with the Constitution if the Statute had
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recognised and left unimpaired the existing powers of localauthorities, and had proceeded to grant them an additional power, intheir discretion, of gifting such houses to the tenants.
Mr. Seneviratne, PC, Contended, however, that the effect of section4{1) of the Statute would be to confer a "power" on a local authority totransfer a house to a tenant, in the same way as section 5A(1),introduced by the amending Act No 63 of 1979:
“5A(1) Where prior to the 15th day of October, 1979, a house towhich this Act applies has been let to any person under theprovisions of section 3(1) and the monthly rental of such houseimmediately prior to such letting did not exceed twenty-fiverupees, the local authority … shall, by an instrument of disposition,transfer, free of charge, that house to that person.”
That provision undoubtedly curtailed a local authority’s rights andpowers, because it compelled it to gift any such house, whether itwished to or not. It imposed an obligation, which diminished orextinguished its rights and powers under section 3(1) of the Act. Thefact that, in order to give effect to that obligation, a local authority wasalso “empowered” to execute an instrument of disposition does notmean that its power under section 3(1) was not diminished.
2. Mr. Kamalasabayson submitted that an amendment to the longtitle was necessary. As section 4(1) and (2) of the Statute wouldbe inconsistent with section 3(1) of the Act, I hold that theStatute should have been described in its long title “as beinginconsistent with that law" as required by Article 154G(8).Mr. Seneviratne did not dispute this.
For these reasons, I determine that the long title and sections 4(1)and (2) of the Statute are inconsistent with the Constitution.
WUETUNGA, J. -1 agree.
ANANDACOOMARASWAMY, J -1 agreeStatute determined to be unconstitutional.
