CREDIT INFORMATION BUREAU OF SRI LANKA vs. MESSARS JAFFERIEE & JAFFERJEE (

011-SLLR-SLLR-2005-V-1-CREDIT-INFORMATION-BUREAU-OF-SRI-LANKA-vs.-MESSARS-JAFFERIEE-JAFFERJEE-.pdf


CREDIT INFORMATION BUREAU OF SRI LANKAvs
MESSRS JAFFERIEE & JAFFERJEE (PVT) LTD
SUPREME COURTS. N. SILVA, CJ '
J.A. N.DE SILVA; J. ANDWEERASURIYA, JS. C. APPEAL NO. 47A/2003C. A. NO.'1406/2001
9th FEBRUARY AND 19th MARCH 2004
Write of mandamus – Public or statutory duty – Non- availability of the remedywhere the statutory duty is not compellable – Sections 6 and 7 of Act, No. 18 of1990 amended by Act, No. 8 of 1995
The Credit Information Bureau of Sri Lanka was established by Act, No. 18 of1990 as amended by Act, 8 of 1995 (the Act.) The object of the Bureau is toassist its shareholders such as the Bank of Ceylon (vide Section 29) andprotect them being misled by the information given by borrowers such as therespondent.
The provisions relating, inter -alia, to the functions and powers of the Bureaufor providing credit information on borrowers and lending institutions arecontained in sections 6 and 7 of the Act, as amended. In terms of theseprovisions, the Bureau is required to furnish information on request inconfidence to shareholders of the Bureau (i.e, to lending institutions.) The dutyto furnish such information is unqualified. However, the borrowers are entiltled
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to obtain such information only upon a request by shareholders subject tosuch terms and conditions as may be determined by the Bureau. This meansthat the provisons of any information to a borrower is conditional on a requestby a shareholder and is not compellable.
However, the Court of Appeal granted a writ of mandamus directing the Bureau(the appellant) to furnish credit information to the respondent (a borrower)which information had been provided to lending institutions and the nature ofthe information that has been so furnished.
Held:
Although the appellant was a public body and could be compelled bymandamus to provide information to shareholders, the court was in error inusing a writ of mandamus to compel the giving of information to the respondent(a borrower).
The respondent had no right to compel the giving of such information bymandamus without a request by a shareholder.
In any event, the court was informed that the respondent had obtained theinformation by other means. Hence the issue of the writ of mandamus wasfutile. This was another ground to refuse the writ.
Cases referred to :
’ R. V. Barnstaple Justices (1937) 54 TLR 36
Napier ex parte 1852 18 QB, 692 at 695
R. V. Lewishan Union (1897) I QBD 498
P, K. Benarji V H. J. Simonds AIR (1947) Cal 347
Sanjeevayya V Election Tribunal AIR (1967) SC 1211
APPEAL from the judgment of the Court of Appeal.
Romesh de Silva, P.C. with Geethaka Gunawardene for appellantP. Nagendra, P. C. with C. W. Pannila for respondent.
Cur.adv.vult
August 31, 2004
J. A. N. DE SILVA J.
This is an appeal against the judgment of the Court of Appeal dated 19/02/2003 wherein the Court of Appeal issued a writ of Mandamus directing the
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Messrs Jafferiee & Jafferjee (Pvt) Ltd (De Silva, J.)
Respondent Appellant (hereinafter referred to as the Appellant) to discloseto the Petitioner Respondent (hereinafter referred to as the Respondent)the credit information that it had provided to lending institutions and thenature of the information that been so furnished.
When the application for Special Leave to Appeal was supported, Special ■Leave was granted on the following questions:
. Have their Lordships failed to analyse the provisions contained in
Section 7 (b) of Act, No. 18 oof 1990 as amended by Act, No. 8 of1995?
Have their Lordships erred in law in the interpretation of the provisionscontained in Section 6 (b) of Act, No. 18 of 1990 as amended readtogether with Section 7 (b) of the Act?
Have their Lordships erred in law in interpreting the word“simultaneously” found in Section 6 (b) and the preamble of the Act?
Have their Lordships erred in law in giving an interpretation to thisword “simultaneouly” to mean that the Appellaht was bound in law toprovide such information simultaneously to the borrower even withouta request from it’s shareholders?
Have their Lordships failed to appreciate that the data base of theRespondent is consistently changing and the information that itpossessed in respect of the year 2000 is not presently before it assuch information is updated by other information?
Have their Lordships failed to appreciate that a prospective borrowerhas no right in law to demand, obtain and receive a loan and/ or afunctional accommodation and / or facility from a financial institution,and the further arguments that such loans and/or financial facilitieswould be disbursed only at the absolute discretion of the said financialinstitutions?
The Respondent is not entitled to the Public Law Remedy namelywrit of Mandamus.
In any event the Respondent is not entitled to a writ of Mandamus inthat the Petitioner is guilty of laches.
7 – CM 5250
9 2Sri Lanka Law Reporis(2005) 1 Sri L. R.
The case of the Respondent in the Court of Appeal was that under andin terms of Section 6 (b) of the Credit information Bureau of Sri Lanka Act,No. 18 of 1990 as amended by Act, No. 8 of 1995, the Appellant is boundto provide the credit information to it's shareholders and simultaneouslyforward such information to borrowers and prospective borrowers to whomsuch information relates. The Respondent’s grievance was that theAppellant had wrongfully, unlawfully and / or illegally refused to forwardsuch information to the Respondent and thereby failed to perform its statutoryduty and obligation.
All the questions raised in this appeal could be resolved in my view byconsidering the availability of the writ of Mandamus to the Respondent.The learned counsel for the Appellant submitted that a writ of Mandamsbeing a public law remedy is not available to the Respondent as the CreditInformation Bureau is not a State entity or instrument of the State. Theanswer to this is found in the following passage in Halsbury’s Laws ofEngland, Vol (1), 4th Edition (Administrative Law) paragraph 132, “Anorder of Mandamus will be granted ordering that an act to be donewhich a statute requires to be done and for this rule to apply- it is notnecessary that the party or corporation on whom the statutory duty isimposed should be a public official or an official body.” The CreditInformation Bureau is created by an Act of Parliament. It is not akin to aprivate club, as contended by the counsel for the Appellant, which isgoverned by its own constitution/ rules or regulations. Every action has tobe taken within the four corners of the statute and according to theprocedure set out in the Act.
The Board Members of the Credit Information Bureau are appointed in thefollowing manner (vide Section 5);
A Deputy Governor of the Central Bank nominated by the MonetaryBoard who shall be the Chairman of the Board.
A Senior Officer of the Central Bank nominated by the MonetaryBoard.
A Senior Officer of the Bank of Ceylon nominated by the Board ofDirectors of the Bank of Ceylon.
A Senior Officer of the Peopl’s Bank nominated by the Board ofDirectors of the PeoDle’s Bank.
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Person elected by the share holding Finance Companies
A person nominated by the Minister in charge of the subject of Financefrom the Board of Directors of the National Development Bank,Development Finance Corporation and State Mortgage andDevelopment Bank.
When considering the composition of the Board of Directors of theCredit Information Bureau ope cannot get behind the fact that it isfunctioning under the control of “Public Officers” and that they dischargepublic funcions. In these cirumstances it is not difficult to conclude thatthe Credit Information Bureau is amenable to a .writ of Mandamus if theother conditions are satisfied.
The judicial control over the fast expanding maze of bodies affectingrights of the people should not be put into water tight compartments. Itshould remain flexible to meet the requirements of variable circumstances.
There is rich and profuse case,law on Mandamus on the conditions tobe satisfied by the Applicant. Some of the conditions precedent to theissue of Mandamus appear to be :
The Applicant must have a legal right to the performance of a legalduty by the parties against whom the Mandamus is sought (R vBarnstaple Justices)<” The foundation of Mandamus is the existenceof a legal right (Napier Ex parte™)
The right to be enforced must be a “Public Right” and the duty soughtto be enforced must be of a public nature.
The legal right to compel must reside in the Applicant himself (R vLewisham Union(3)
The application must be made in good faith and not for an indirectpurpose
The application must be preceded by a distinct demand for theperformance of the duty
The person or body to whom the writ is directed must be subject tothe jurisdiction of the court issuing the writ.
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The Court will as a general rule and in the exercise of its discretionrefuse writ of Mandamus when there is another special remedyavailable which is not less convenient, beneficial and effective.
The conduct of the Applicant may disentitle him to the remedy.
It would not be issued if the writ would be futile in its result.
Writ will not be issued where the Respondent has no power to perform. the act sought to be mandated.
The above principles governing the issue of a writ of Mandamus werealso discussed at length in P. K. Benarji Vs H. J. Simonds(<>. Whetherthe facts show the existence of any or all pre-requisites to the granting ofthe wirt is a question of law in each case to be decided not in any rigid ortechnical view of the question, but according to a sound and reasonableinterpretation. The court will not grant a Mandamus to enforce a right notof a legal but of a purely equitable nature however extreme theinconvenience to which the applicant might be put.
In the instant case we have to consider whether the Respondent has alegal right to get any information from the Credit information Bureau. TheCredit Information Bureau of Sri Lanka (Applicant) was established byAct, No.'18 of 1990 specifically setting out
as functions of the Bureau, it inter alia :
To collect and collate, credit and financial information on borrowersand of lending institutions.
To provide credit information, on request to lending institutionswho are shareholders of the institutions who are shareholders ofthe bureau.
as powers and duties of the bureau inter alia:
(1) to forward credit information on request and in confidence to shareholders of the bureau and to prescribe the forms in which suchinformation is to be furnished.
Act, No. 18 of 1990 was subsequently amended by Act, No. 8 of1995. By this amendment the functions of the Bureau was amended asfollows:
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“to provide credit information, on request, to lending institutionswho are shareholders of the Bureau and simultaneously toborrowers and prospective borrowers to whom such informationrelate”.
The powers and duties of the Bureau were amended as follows:“in discharging its functions the Bureau may exercise and performall or any of the following”
to furnish information on request in confidence toshareholders of the Bureau.
to furnish information on request by a shareholder of theBureau to a borrower or to a prospective borrower to whomsuch information relates, subject to such terms andconditions as may be determined by the Bureau.
It is therefore clear that prior to the amendment it was imperative thatall credit information was furnished by the Appellant strictly in confidenceto its shareholders and no other. By the amendment the Credit InformationBureau was granted powers to furnish credit information on request in onlytwo give situation, i. e.
When a request is made by a shareholder for suchinformation, then the Appellant can accede to such a request and furnishthe relevant credit information to such shareholder in confidence; or'
If there is a request from a shareholder to the Appellant thenthe Appellant Bureau may furnish credit information to the borrower orprospective borrower to whom such information relates.
It is relevant to note that “on request” pre dictates both situations whereinformation is provided.
In the first situation there is only a furnishing of information, exclusivelyto the shareholders. The use of the words “ in confidence” clarifies thisposition. In the second situation, information can be furnished to a borrowerto whom such information relates, provided that there is a satisfaction oftwo important pre conditions, namely,
96Sri Lanka Law Repons(2005) 1 Sri L. R.
There must be a request from the shareholder. More specificallythe shareholder of the Bureau must request the Bureau to provide suchcredit information to the borrower or the prospective borrower and
The Credit Information Bureau determines the terms and conditionsand the form on such information is to be furnished.
From the above discussion it is clear that the Respondent has no clearlegal right to demand the information from the Credit Information Bureauwhich is the basis or foundation to grant a Mandamus. Borrowers cannotas of right request for information to be given to them. Their right, if any,came into operation only when a lending institution makes a request tothat effect. Therefore there is no legal duty cast on the Credit InformationBureau to furnish information on a request made by a borrower. It was thecontention of the Respondent that as the word “simultaneously” appearsin the preamble of the amended Act, there is a duty cast on the CreditInformation Bureau to convey the credit information regarding the borrowerwhich is furnished to a lending intitution to be given to the borrower alsosimultaneously. This was the argument accepted by the Court of Appeal.
The preamble is certainly a part of the Act. It is elementary to say thatthe intention of the legislature must be gathered from the language of theAct itself. It is only where there is ambiguity and when an expression usedby the legislature is capable of more than one meaning that it is permissiblefor the Court to look at the Preamble. When there is a conflict betweenthe Preamble and the provisions of an Act the latter shall prevail. It is a wellsettled rule of construction that the provisons of a statute should be soread as to harmonize with one another and the provisons of one sectioncannot be used to defeat those of another unless it is impossible to effectreconciliation between them (vide Sanjeevayya Vs Election Tribunal™)
am mindful of the fact the Credit Information Burea was established toassist Financial Institutions and to protect them from being misled by theinformation given by borrowers. The Credit Information Bureau is anautonomous body created by an Act of Parliament cast with the duty tofurnish information to Financial Institutions on credit standing of theborrowers. Financial Institutions can be shareholders in this corporation.Due to this fact Finacial Institutions can claim that the information shouldbe confined only to them and that no borrower has a legal right to obtain
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this information from the Credit Information Bureau. By the amending actof 1995 a concesson has been granted to the borrowers in that if a lendinginstitution requests the information could be given to the borrowers too' simultaneously. Other than this there is no independent legal right for theborrowers to cail for this information as and when they want.
At the stage of the argument it was brought to the notice of this courtthat the information the Respondent requests has already been obtainedby them through other means. Therefore it would be fut.ile in its result toissue a writ of Mandamus. This is another ground to refuse the writ.
In these circumstances I am of the view that all the questions raised inthis appeal are answered fully in the above discussion. I hold that thejudgment of the Court of Appeal is erroneous and set aside the sameand allow the appeal without costs.
SARATH N. SILVA, C. J. — I agree.
WEERASURIYA, J. — I agree.
Appeal allowed.