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Hometown Motors Ltd v Principal Licensing Authority [1995] FJHC 177; Hbj0030d.1995s (19 December 1995)

IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION

JUDICIAL REVIEW NO. 30 OF 1995

IN THE MATTER of TRAFFIC ACT [CAP. 176]
and REGULATIONS made under it.

AND

IN THE MATTER of an Application by HOMETOWN MOTORS LIMITED
and AUTOMART LIMITED for a Judicial Review
and with other reliefs for an Order of Certiorari to quash the decision
made by the PRINCIPAL LICENSING AUTHORITY
whereby he will no longer register and issue current registration plates
to second hand imported motor vehicles unless registered with letter "E"
followed by numbers to distinguish second hand and new vehicles.

Between:

HOMETOWN MOTORS LIMITED
and AUTOMART LIMITED
Applicants

- and -

PRINCIPAL LICENSING AUTHORITY
Respondent

Messrs. J. R. Reddy and A. K. Narayan for the Applicants
Mr. S. Banuve for the Respondent

DECISION

There are two applications before me. One is for leave to apply for Judicial Review by the Applicants of a decision by the Principal Licensing Authority (hereafter referred to as the "PLA") made on 10 November 1995 requiring all second hand motor vehicles imported by the Applicants and other importers of second hand motor vehicles to be issued with 'E' registration number plates instead of the current practice (since 1992 onwards) of issuing the current 'C' serial numbers for all vehicles (new or second hand). The other is an application, which was lodged simultaneously with the first application, for a stay of the implementation of the said decision to maintain the status quo until further Order of this Court.

All papers relating to the first application were served on the Respondent on 6 December and those relating to the second were served on 8 December and affidavits of service have been filed in Court.

Both applications were heard on 13 December.

On the first application after Mr Reddy had made his submissions, Mr. Banuve had no objection to the granting of leave. In the circumstances, the Court had also upon reading the Affidavit in support and upon hearing Mr. Reddy and Mr. Banuve granted leave to apply for Judicial Review of the said decision.

That left the matter of stay for my consideration.

Both counsel made their respective submissions in this regard.

The Issue

The only issue before me is whether I should grant a stay of the said decision of the Principal Licensing Authority (PLA) and preserve the status quo.

The Applicants' submission

Mr. Reddy submits that PLA is neither a 'Crown' nor a 'servant of the Crown'. He is appointed under s.5 of the Traffic Act. He says that this section does not require that PLA shall be a public servant, and in the past, holders of this post have been like the present incumbent "political appointees" with prescribed terms. Therefore, he says that a stay order could be made against him. He goes on to say that stay orders have been made against PLA and in this regard he referred the Court to Judicial Review No. 3/95L (Western Wreckers Limited and Principal Licensing Authority). In support of his argument for stay Mr. Reddy referred at length to the Affidavit in Support for leave and dwelt heavily on the manner in which the decision was reached by PLA and this approach was, inter alia, ultra vires the PLA and contrary to the provisions of the Traffic Act.

The Respondent's submission

Mr. Banuve asks the Court to consider three points which should be considered in an application for stay and for that he referred the Court to the Fiji Court of Appeal case of REDDY'S ENTERPRISES LIMITED and THE GOVERNOR OF THE RESERVE BANK OF FIJI (Civil App. No. 67/90) being an application in Chambers for a Stay Order before SIR MOTI TIKARAM J.A. (now President). The three points which he referred to and which were considered by Sir Moti were the nature of application, prejudice and balance of convenience.

He submits that the Applicants are continuing to sell 'E' number cars. He says that as far as irrepairable harm is concerned they "have to be more serious". The 'balance of convenience' has to be considered. He says that the PLA has a 'wider interest' to look after for the purchasers of vehicle rely on the number and this could turn out to be "deceptive". He submits that there is no "business detriment" to the Applicants.

The determination of the issue

I am in no doubt that a stay order could be made against the PLA. Mr Banuve has also not made an issue of this for my consideration and as stated by Mr. Reddy orders have been made against the PLA in the past (Western Wreckers Limited, supra)

That aspect having been disposed of I can proceed straight on to a consideration of the application for stay.

Having granted the leave to apply for judicial review, now is the time to consider the stay application for Or 53 r 3(8)(a) provides:

"8. Where leave to apply for judicial review is granted, then:

(a) if the relief sought is an Order of prohibition or certiorari and the Court so directs, the grant shall operate as a stay of the proceedings to which the application relates until the determination of the application or until the Court otherwise orders;"

In considering the issue before me I cannot ignore the background to this case and it is principally against that background and the nature of the case, inter alia, that the decision on the stay application rests.

I will therefore very briefly give an outline of the salient facts. It is pertinent to note that much of the essential facts contained in the Affidavit in support of leave and in support of Motion for Stay are not in dispute.

The PLA who is appointed by the Minister of Transport is charged with the responsibility of issuing and assigning registration numbers and registration plates to motor vehicles. From 10 November 1995 he required that all second hand vehicles imported by the applicants and other importers of second hand motor vehicles to be issued with "E" registration number plates. But prior to 10 November (since 1992) all motor vehicles including new motor vehicles were issued with the "same registration plates in a serial order".

The PLA was aware before he made the said decision that the applicants and other second hand car dealers had already imported second hand motor vehicles and they are in Fiji. He was also aware that the applicants and others have contracted to sell the vehicles to purchasers but awaiting licensing and registration. They say that there is a grave danger that unless the purchasers get the current number plates, the applicants could be sued for breach of contract.

I have carefully considered the facts surrounding this case and counsels' submissions. Bearing in mind the said three points referred to by Mr. Banuve which ought to be taken into account in considering an application for stay, I find that if ever there was a case where a stay ought to be granted it is this.

The Applicants have made out a very strong case for the grant of a stay of PLA's said decision. Here is a case where the PLA, who allegedly has no powers vested in him to make a decision of this nature under the Traffic Act and regulations made thereunder, goes ahead without any notice to the applicants and other second hand car dealers and without any consultation with them thrusts this decision on them to their great surprise and astonishment. They have been taken aback by this decision with considerable possible pecuniary loss to them if the decision is persisted in. Mr. Banuve says that the damage has to be 'more serious' than what it is stated to be. I do not agree with that viewpoint but I do accept that "balance of convenience" cannot be measured simply in terms of the financial consequences to the parties. He referred the Court to RE MOORE; Ex parte PILLAR ALJR Vol 65 1991 where it was held:

"Where the subject matter of proceedings is a question that will remain alive irrespective of the High Court's granting or withholding a stay of those proceedings; the Court is not satisfied that the party seeking a stay will be denied relief if it is withheld; and no other special circumstances exist, the Court will refuse to order a stay or the continuance of an interim stay". (underlining mine for emphasis)

There are many special circumstances in this case as pointed out by Mr. Reddy some of which I have already stated hereabove to warrant the grant of stay.

As I said earlier, from the material before me it appears, and as very forcefully argued by Mr. Reddy, the PLA allegedly had no authority in law under the Traffic Act and any subsidiary legislation or regulation empowering him to make this decision. Where does the decision emanate from? The Central Traffic Authority has not made any regulation which has given rise to this decision.

In considering the issue before me, I am not concerned at this stage to go fully into the merits of the judicial review application. Under the caption "Interim Relief", Clive Lewis the author of JUDICIAL REMEDIES ON PUBLIC LAW (1992) at p.206 states as follows on whether the applicant needs to prove that there is a serious case or does he need to establish a prima facie case:

"There is still doubt as to whether the applicant in judicial review needs only to prove that there is a serious issue that the proposed act is ultra vires, or whether he needs to establish a prima facie case. There are dicta indicating that the serious issue test applies, and that the reasons for not inquiring into the merits of cases at the interlocutory stage apply as much to cases involving public bodies as they do to private individuals. Equally, there are dicta suggesting that public bodies should not be prevented from exercising public law powers unless the plaintiff can establish a prima facie case that the public authority is acting unlawfully. The courts are certainly reluctant to grant an interim mandatory injunction to compel the performance of public law duties, unless the applicant can establish a prima facie case that the public body is acting unlawfully. (underlining mine for emphasis).

And at p.207 the learned author goes on to say:

"An alternative approach is to take account of the strength of the applicant's case when weighing the balance of convenience. This was the course preferred by Lord Goff in R. v. Secretary of State for Transport, ex p. Factortame Ltd. (No. 2). He considered that the wider public interest which needed to be taken into account included the interest in enforcing apparently valid subordinate legislation or apparently authentic legislation which allegedly contravened European Community law. Although not laying down a rule that a prima facie case needs to be made out, he considered that a court should not normally restrain:

'... a public authority by interim injunction from enforcing an apparently authentic law unless it is satisfied that the challenge to the validity of the law is, prima facie, so firmly based as to justify so exceptional a course being taken.'" (underlining mine for emphasis)

It appears therefore that it was not competent for PLA to commence issuing 'E' number plates. It appears that it is an unreasonable and arbitrary act on the part of PLA and ultra vires the PLA. Mr. Banuve has not put forward any counter argument to what Mr. Reddy has submitted particularly in regard to PLA's authority or lack of authority to make such a decision.

The applicants are further perturbed that despite the decision a Minister and a Resident Magistrate, among others, have been issued with 'current numbers'. They argue that this could lead to corrupt practices. Why is there such a discrimination they ask. On this Mr. Banuve said that he will speak to PLA.

I have no doubt whatsoever in my mind that the Applicants will be greatly prejudiced if the status quo was not maintained. They will also suffer great pecuniary loss thereby. The PLA has nothing to lose if stay was granted for after all he has been issuing the current number plates since 1992 without discriminating between new and second hand cars. Was he not considering the interest of the purchasers or consumers or 'greater public interest' then? In any case it is stated that the Fair Trading Decree is there for the protection of the consumers and the PLA need not concern himself with this aspect. In all the circumstances of this case, the "balance of convenience" principle also favours the grant of stay after balancing not only the interests of the parties to this application but also the wider public interest in the matter. On balance of convenience LEWIS (supra) at p.207 said:

"The balance of convenience in public law cases must take account of the wider public interest and cannot be measured simply in terms of the financial consequences to the parties". (SIERBEIN v WEST MINISTER CITY COUNCIL (1987) 862 GR 431; SMITH v INNER LONDON EDUCATION AUTHORITY (1978) 1 AER 411"

In this case the question of wider public interest will have no validity unless the decision was lawfully arrived at; here everything points in the opposite direction. In short it is alleged that PLA's decision is unlawful to start off with. If the decision turns out to be lawful then of course the above-quoted passage and the following passage from LEWIS (supra) at p.208 would have been more relevant:

"More significantly, the public interest frequently cannot be measured in terms of financial consequences. The public body will have taken the decision or adopted the measure in the exercise of powers which it is meant to use for the public good. The courts must take into account that wider public interest in deciding whether to grant interim relief. The courts will be placed in the difficult position of trying to place a value on the public interest, and balancing that against the financial or other consequences suffered by the individual. In Sierbein v. Westminster City Council, for example, the applicant sought an interim injunction to suspend a decision refusing him a licence for a sex shop so that he could re-open the sex shop. The Court had to weigh the public interest in controlling the number of sex shops in the area against the financial loss suffered by the individual having to close his business, given the fact that damages would not be available if it transpired that the refusal of a licence was ultra vires and he could lawfully have kept his business open. The court came down in favour of refusing an injunction."

Mr. Lewis at p.209 concluded as follows:

"There are great difficulties in applying the balance of convenience test in public law cases, and determining the proper weight to be given to the public interest. This is one reason for insisting that the applicant should have made out a prima facie case (possibly a strong one) before the court moves to upset the delicate balance of interests that the initial decision by the public body itself represents. It was for this reason that the House of Lords took into account the strength of the challenge to the validity of legislation in determining where the balance of convenience lay."

To conclude, in the outcome for the above reasons I order a stay of the decision of 10 November 1995 whereby the Principal Licensing Authority refused to continue to issue current number plates for second hand motor vehicles as hitherto had been the practice since 1992 but would issue number plates commencing with the letter 'E'.

Therefore the grant of leave to apply for judicial review shall operate as a stay of the proceedings to which the application relates until the determination of the application or until the Court otherwise Orders.

The costs are to be costs in the cause.

D. Pathik
Judge

At Suva
19 December, 1995

HBJ0030D.95S