CA
83
A. R. Perera & Others vs
Central Freight Bureau of Sri Lanka and Another (Marsgof, J.)
A. R. PERERA AND OTHERSvsCENTRAL FREIGHT BUREAU OF SRI LANKA AND ANOTHERCOURT OF APPEALMARSOOFJ. (P/CA) ANDSRI SKANDARAJAH, J.
CA 999/2003JULY 13
AUGUST 23 AND SEPTEMBER 17, 2004
Writ of certiorari – Locus standi – Traditional view, conservative view and liberalview – Companies Act, No. 17 of 1982 – Who are busy bodies ?- ConstitutionArticles 12, 141, 17, 126, and 140 – Rationale for expanding canvas of locusstandi.
The 1 st and 2nd petitioners – the Chairman and Secretary General of theCeylon Association of Ships Agents (CASA) consisting of 113 members whoare shipping agents and the 3rd petitioner who is a member of the ExecutiveCommittee of CASA and a director/shareholder of Malship Ltd., which companyis engaged in the business of a shipping agent, challenged the order made bythe 1st respondent imposing certain levies and service charges.
The Executive Committee of the CASA had determined and resolved thatit is imperative that CASA, through the petitioners file an application on behalfof its membership with a view to obtaining relief and redress. The petitionersalso claimed that the resolution/determination of the CASA was ratified at anextraordinary general meeting of CASA. When the matter was taken up forargument the respondent took up a preliminary objection that the petitioners
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lack locus standi, as CASA is a company limited by guarantee incorporatedunder the Companies Act with the power to sue and be sued in its corporatename.
Held:
(i) The petitioners are all persons whose interests are affected by what isalleged to have been done by the respondents. The 1st and 2ndrespondents have sufficient interest in the matter as office bearers ofCASA, the 3rd respondent as a member of the Executive Committeeand an authorized representative of Malship, a corporate shipping agent,have sufficient interest in the matter in question. Even if the petitionersare to be treated as mere members of .the public, they have sufficientinterest in the matter to distinguish them from the esteemed category of“busy bodies”.
Per Marsoof, J. P/CA,
“Time and again our courts have repeated that the fact that the irregularityor the grievance for which redress is sought is shared by a large numberof people or society as a whole would not prevent one of many affectedpersons from seeking relief from courts.
There can be no doubt that the petitioners are all persons whoseinterests are affected by what is alleged to have been done by therespondents. Sri Lankan courts have been quick to recognize standingof any citizen to seek relief against public authorities that stray outsidetheir legitimate bounds.”,
APPLICATION for a writ of certiorari.
Cases referred to:
Durayappa vs Fernando 69 NLR 265
R vs Paddington Valuation Office (1996) 1 QB 380 at 401
Premadasa vs Wijewardena & Others (1991) 1 Sri LR 333 at 343.
R vs Greater London Council exparte Blackburn (1968) 2 QB 118
Me Whirtervs Independent Broadcasting Authority (1973) QB 629
R vs Inland Revenue Commissioners ex p. National Federation of SelfEmployed and Small Industries (1982) AC 617.
Bandaranayake vs De Alwis & Others (1982) 2 Sri – LR 664 at 682
■)AA. R. Perera & Others vs85
Central Freight Bureau of Sri Lanka and Another (Marsoof, J.fPJCA))
Merit vs Dayartanda de Silva (2001) 2 Sri LR at 41-42
Forbes & Walter Tea Brokers vs Maligaspe and others (1998) 2 Sri LR378.
Mediwake and others vs Dayananda Dissanayake, Commissioner ofElections and others (2000) 1 Sri LR 177
Sunila abeysekera vs Ariya Ruabasinghe (2001) 1 Sri LR 315
Leader Publications vs Ariya Rubasinghe (2001) Sri LR
Lilanthi de Silva vs Attorney General (2003) Sri LR 155
Bulankulame and others vs Secretary, Ministry of Industrial Developmentand others (2000) 3 Sri LR 243
D. U. M. Jayatilake and others vs Jeevan Kumaranatunga and othersCAM 29.7.2004.
S. P. Gupta vs. Union of India (1982) ARI (SC) 149
Akhila Bharatiya Grahak Panchayat vs A. A. S. E. Brand (1983) AIR(Andre Pradesh) 283
P. Nella Thamby Rosa Vs. Union of India (1984) AIR (SC) 74
hibly Aziz, P. C. with P. Gunaratne and S. Ahamed for petitioners.
. Kanag-lswaran, P. C. with Nigel Bartholomeuz for 1st respondent.
M. R. Ameen, State Counsel for 2nd respondent.
Cur.adv.vult
January 10, 2005SALEEM MARSOOF, J. P/CA
The 1st and 2nd Petitioners purport to be respectively the Chairmanand Secretary-General of the Ceylon Association of Ships’ Agents (CASA)consisting of 113 members who are shipping agents, and the 3rd Petitionerpurports to be a member of the Executive Committee of CASA and aDirector and shareholder of Malship Ceylon Limited, which company isengaged in the business of a shipping agent. The Petitioners state in theirpetition that the members of CASA have been concerned with, and aggrievedby, the imposition of certain levies and service charges by the 1stRespondent, and as such, the Executive Committee of CASA determinedand resolved that it is imperative that CASA through the Petitioners file
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this application on behalf of its membership with a view of obtaining reliefand redress. The Petitioners claim that the said determination and resolutionof the Executive Committee of CASA were ratified by the members of theCeylon Association of Ships’ Agents (CASA) at an Extraordinary GeneralMeeting of CASA held on 29th May 2003.
In paragraph 6 of their petition, the Petitioners expressly state that theyare invoking the jurisdiction of this Court in terms of Article 140 of theConstitution in their individual capacities as well as on behalf of themembers of the CASA respectively as President, Secretary General andMember of the Executive Committee and as representatives of the CASA.In addition the 3rd Petitioner, as the representative of Malship CeylonLimited, which is engaged directly in the business of shipping agent, claimsthat he has become party to this application on behalf of the said companyin addition to his capacity as a member of the Executive Committee ofCASA.
When this case was taken up for argument learned Counsel for the 1 stRespondent took up a preliminary objection based on paragraph 1 of theStatement of Objections filed by the 1 st Respondent that the Petitionerscannot have and maintain this application as they do not have any right inthemselves or the locus standi to institute and maintain this application,in that, the Ceylon Association for Ships’ Agents (CASA), is a companylimited by Guarantee, incorporated under the Companies Act, No. 17 of1982 on 18th October 2000 with the power to sue and be sued in itscorporate name. After hearing submissions of learned President’s Counselfor the Petitioners and the learned President’s Counsel for the 1stRespondent on this preliminary objection, Court granted time for learnedCounsel to file written submissions. At the instance of State Counselappearing for the 2nd Respondent, Court also made an order dischargingthe 2nd Respondent from these proceedings as no relief had been prayedfor against the said Respondent in the petition.
Learned President’s Counsel for the 1 st Respondent submits that thisapplication has to be dismissed in limine as the petitioners cannot haveand maintain this purported application for the relief prayed for by them, asthey do not have any right in themselves or the locus standi to instituteand maintain this application. He submits that the lack of locus standi hasbeen recognised as a fundamental limitation in the granting of prerogative
CA
87
A. R. Perera & Others vs
Central Freight Bureau of Sri Lanka and Another (Marsoof, J.(P/CA))
remedies in terms of Article 140 of the Constitution. He states that theCeylon Association for Ships’ Agents (CASA), is a company limited byguarantee incorporated under Section 21 (1) of the Companies Act, No. 17of 1982 on 18th October 2000, with the power to sue and be sued in itscorporate name as evidenced by the Memorandum of Association andArticles of Association marked ‘IR’ annexed to the Statement of Objectionsof the 1 st Respondent. He submits that CASA is a distinct corporate bodyconsisting of shipping agents having corporate status and is not made upof individuals, and in any event it possesses a legal personality distinctfrom its members or office bearers. Section 21 (1) of the Companies Act,No. 17 of 1982 provides that-
“Where it is proved to the satisfaction of the Registrar that anassociation whether of recent origin or otherwise about to be formed asa limited company is to be formed for promoting commerce, art, science,religion, charity, sport, or any other useful object, and intends to applyits profits, if any, or other income in promoting its objects and to prohibitthe payment of any dividends to its members, the Registrar may bylicense direct that the association may be registered as a company,with limited liability, without the addition of the word “limited” to itsname, and the association may be registered accordingly and shall onregistration enjoy all the privileges and (subject to the other provisionsof this section) be subject to all the obligations of a limited company”.
It is submitted theretofore that it was only CASA, as a limited companyand a body corporate, that could have instituted this application as itpossesses the necessary corporate status to sue and be sued in itsname and on behalf of its members who are shipping agents and havebeen called upon to pay the charges and commissions in terms of theCentral-Freight Bureau Law. It is further submitted that the 1st and 2ndPetitioners as office bearers of CASA have no right or status in theirindividual capacities and cannot have and maintain this application.Similarly, it is submitted that the 3rd Petitioner as a member of the ExecutiveCommittee of CASA and a Director and shareholder of Malship CeylonLimited does not have any right or status in his individual capacity andcannot have and maintain this application on behalf of CASA or MalshipCeylon Ltd. It is further submitted that in the circumstances the law wouldconsider them “meddlesome busybodies” for they have no right in theirindividual capacities distinct and different from that of CASA or Malship.
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Although the learned Counsel for the 1 st Respondent does not cite anycase law in his written submissions in regard to the question of locusstandi which he has chosen to argue on first principles, he could easilyhave relied on the classic decision in Durayappa V. Fernando™ in whichthe Privy Council held that the Mayor of a Municipal Council cannot seekredress from courts with respect to a legal wrong or injury caused to aMunicipal Council. Lord Upjohn expressed the opinion of the Court atpage 274 in these words-
“Their Lordships therefore are clearly of opinion that the Order of theMinister on 29th May 1966 was voidable and not a nullity. Being voidableit was voidable only at the instance of the person against whom theOrder was made, that is the Council. But the Council has notcomplained. The appellant was no doubt Mayor at the time of itsdissolution but that does not give him any right to complain independentlyof the Council.”
It is noteworthy that in the case before us, as much as in Durayappav. Fernando, no explanation has been offered by any of the Petitioners asto why CASA and/or Malship have not sought to invoke the jurisdiction ofthis Court.
Learned President’s Counsel for the Petitioner submits that our lawrelating to locus standi has developed a great deal from the days ofDurayappa v. Fernando, (Supra) and in view of the liberal attitude towardsstanding adopted by the Courts, the Petitioners in the present case are infact entitled to have and maintain this application. He submits that the lawhas moved forward and become progressive, and relies on the followingdictum of Lord Denning, in RvPaddington Valuation Office™ –
‘The Court would not listen, of course to a mere busybody who wasinterfering in things which did not concern him. But it will listen to anyonewhose interests are affected by what has been done.”
Our courts too have applied same test in regard to standing. Forinstance, in Premadasa v Wijewardena and others™ Tambiah CJ observedthat-
‘The law as to locus standi to apply for certiorari may be stated asfollows : The writ can be applied for by an aggrieved party who has a
CA
A. B. Perera & Others vs
Central Freight Bureau of Sri Lanka and Another (Marso'of, J.(P/CA))
89
grievance or by a member of the public. If the applicant is a member ofthe public, he must have sufficient interest to make the application.”
There can be no doubt that the Petitioners are all persons whoseinterests are affected by what is alleged to have been done by theRespondents. The 1st and 2nd Petitioners have sufficient interest in thematter, as office bearers of CASA, and the 3rd Respondent as a memberof the Executive Committee of CASA and authorized representative ofMalship, a corporate shipping agent, have sufficient interest in the matterto be regarded as aggrieved parties who have a genuine grievance. Even ifthe Petitioners are to be treated as mere members of the public, they havesufficient interest in the matter to distinguish them from the esteemedcategory of ‘busybodies’.
In fact, in recent times English Courts have shown great latitude inregard to standing in the context of prerogative remedies such as certiorariand mandamus. In RV. Greater London Council ex. parte Blackburnw anapplicant was permitted to pursue the prerogative writ of mandamus inproceedings brought against the Police, even though his interest was nogreater than the interest of other persons in general. Lord Denning in Me.Whirter V. Independent Broadcasting Authority{5> referring to the Blackburncase (supra) page 649 observed that-
“Mr. Blackburn had a sufficient interest even though it was shared
with thousands of othersWe heard Mr. Blackburn in his own
name. His intervention was both timely and useful”.
As Lord Denning noted in R v Inland Revenue Commissioners ex p.National Federation of Self Employed and Small Business Ltd.,{6) EnglishCourts have orchestrated the generous view that “if there is good groundfor supposing that a government department or public authority istransgressing the law, or is about to transgress it, in a way which offendsor injures thousands of her Majesty’s subjects, then any one of thoseoffended or injured can draw it to the attention of the court of law and seekto have the law enforced”. In the course of his judgment in the same case,Lord Diplock observed as follows-
“It would, in my view, be a grave lacuna in our system of public law ifa pressure group, like the federation, or even a single public spirited tax
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payer, were prevented by outdated technical rules of locus standi frombringing the matter to the attention of court to vindicate the rule of lawand get the unlawful conduct stopped.”
The change in legal policy reflected in the decision of the House ofLords in this case was considered by Lord Diplock to be a major step“towards a comprehensive system of administrative law” which he regardedas the greatest achievement of the English Courts during his life time.
The rationale for the expanding canvas of locus standi in the context ofcertiorari and prohibition was explained by H. W. R. Wade -AdministrativeLaw (8th Edition) pages 362 to 363 in the following words-
“The prerogative remedies, being of a ‘public’ character asemphasized earlier, have always had more liberal rules about standingthan the remedies of private law. Prerogative remedies are granted atthe suit of the Crown, as the titles of the cases show ; and the Crownalways has standing to take action against public authorities, includingits own ministers, who act or threaten to act unlawfully. As Devlin Jsaid: Orders of certiorari and prohibition are concerned principally withpublic order, it being the duty of the High Court to see that inferiorcourts confine themselves to their own limited sphere”. In the samesense Brett J had said in an earlier case that the question in grantingprohibition "is not whether the individual suitor has or has not suffereddamage, but is, whether the royal prerogative has been encroachedupon by reason of the prescribed order of administration of justice havingbeen disobeyed”. Consequently the court is prepared to act at theinstance of a mere stranger, though it retains discretion to refuse to doso if it considers that no good would be done to the public.”
Wade further goes on to observe at page 683 that-
“…-.the House of Lords is clearly now determined to preventtechnicalities from impeding judicial review so as to protect illegalitiesand derelictions committed by public authorities”.
Sri Lankan Courts too have been quick to recognize standing of anycitizen to seek relief against public authorities that stray outside theirlegitimate bounds. In Bandaranaike v. de Alwis and Others™ at 682Wimalaratne J. observed that “every citizen has standing to invite the
CA
91
A. R. Perera & Others vs
Central Freight Bureau of Sri Lanka and Another (Marsoof, J.(P/CA))
Court to prevent some abuse of power, and in doing so he may claim to beregarded not as a meddlesome busybody, but as a public benefactor.11 InMerit vs. Dayananda de Silvam at 41 -42 Gunawardana J observed “I strongly
feel thatdenying locus standi to an applicant for judicial review for
no better reason than that his interest or grievance is shared by manyothers in common with the applicant is as illogical and irrational as refusingto treat any one member of the public for a disease which has assumedproportions and has affected virtually the entire community". In Forbes &Walker Tea Brokers v. Maligaspe and Others{9) Gunawardana J went on totrace the developments in the law in this field and observe at page 406that-
“The traditional view is that an applicant for certiorari must show
some interest before being accorded standingThe older, rather the
conservative, view is that applicant must show that he has legal capacityto challenge the act or decision by means of prerogative writs in that heis an “aggrieved person” in the sense that there is some harmpersonalized to the applicant. In other words, the applicant is requiredto establish or prove some individual harm over and above that of thegeneral community or the public at large-although the waning of therigid reliance on the concept that an applicant must have an interest ofhis own at stake, seems to be a universal trend. A necessary corollaryof the rule that the applicant ought not to be accorded standing becausehis (applicant’s) requirement or grievance is one which is complained ofin common with the rest of the public is to deny to the applicant accessto court for no other or better reason than that governmental irregularityor illegality does affect a large number of people. This seems irrationalfor as Craig (tutor in law-Worcester College – Oxford) had said: To denyaccess in such a case seems indefensible. If the subject matter of the
case is otherwise appropriate for judicial resolutionto erect a barrier
of “no standing” would be to render many important areas of governmentalactivity immune from censure for no better reason than that they doaffect a large number of people. One might be forgiven for thinking thatthe common sense of the reasonable man would indicate the oppositeconclusion ; that the wide range of people affected is a positive reasonfor allowing a challenge by someone”.
In Sri Lanka there has been considerable progress in the public interestlitigation arena, and the courts have liberalized rules relating to standing
7 -CM6576
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or focus standi, and permitted not only persons aggrieved but also othersto challenge violations of fundamental rights. Cases such as Mediwakeand Others v Dayananda Dissanayake, Commissioner of Elections andOthers'10' 177, Sunila AbeysekeraV. Ariya Rubasinghe'11) leaderPublications V Ariya Rubasinghe^2' Lilanthi De Silva V. AttorneyGeneral3' are landmark decisions of our Supreme Court which reflectthis liberal approach. As Amerasinghe J observed in Bulankulama andOthers V. Secretary, Ministry of Industrial Development and others^'4''(better known as the Eppawala case) at page 258 –
‘The Court is concerned in the instant case with the complaints ofindividual petitioners. On the question of standing, in my view, thepetitioners, as individual citizens, have a Constitutional right given byArticle 17 read with Articles 12 and 14 and Article 126 to be before thisCourt. They are not disqualified because it so happens that their rightsare linked to the collective rights of the citizenry of Sri Lanka – rightsthey share with the people of Sri Lanka. Moreover, in the circumstancesof the instant case, such collective rights provide the context in whichthe alleged infringement or imminent infringement of the petitioners’fundamental right ought to be considered. It is in that connection thatthe confident expectation (trust) that the Executive will act in accordancewith the law and accountably, in the best interests of the people of SriLanka, including the petitioners, and future generations of Sri Lankans,becomes relevant”.
Time and time again, our courts have repeated that the fact that theirregularity or the grievance for which redress is sought is shared by alarge number of people or society as a whole would not prevent one of themany affected persons from seeking relief from the Courts. In the recentcase of D. U. M. Jayatilleka and others V. Jeevan Kumaratunge andothers05' it was observed by Sriskandarajah J. that –
“The standing rules applicable to applications for prerogative writshave to be considered in the light of the developments taking place inthis sphere of relevant law.”
Similarly, when one looks across the Palk Straits, one cannot help butnotice the landmark decision of the Indian Supreme Court in S. P GuptaV. Union of India (,6) holding that lawyers have a vital interest in theindependence of the judiciary, and therefore have standing to agitate before
CA
Sportsman Tea (Pvt) Ud., vs
Commissioner General of Labour and Others (Sriskandarajah, J.)
93
courts important issues affecting the judiciary, This decision has sincebeen followed in several other cases involving consumer concerns, suchas Akhila Bharatiya Grahak Punchayat vA.P.S. E. Board'7) in which aConsumer Council was held to have locus standi to challenge the actionof an electricity board for increasing the rates of electricity, and P. NellaThampy Thera v Union of lndiai'B) in which the Supreme Court of Indiaentertained a petition at the behest of a railway commuter against theIndian Railways for improving the railway services.
In the present application before this Court, the Petitioners, being officebearers of the Ceylon Association of Ships’ Agents as well as some ofthem being associated with companies upon whom the purported fee wasimposed, clearly have a sufficient interest in challenging the imposition ofthe purported fee, and are not ‘mere busybodies’ who are trying to fish introubled waters. It has been specifically pleaded and averred in the petitionthat the Petitioners have come to Court on behalf of the members of theCASA as well as in their personal capacities.
I do not see any merit in the preliminary objection raised on behalf ofthe 1 st Respondent and have no alternative but to overrule the same.
SRISKANDARAJAH, J. -1 agree.
Preliminary objection overruled; matter set down for argument.
