017-SLLR-1984-V1-LATIFF-v.-THE-LAND-REFORM-COMMISSION.pdf
118
Sri Lanka Law Reports
[1984] 1 SriL ft.
LATIFF
v.THE LAND REFORM COMMISSION
COURT OF APPEAL.
H. A. G. DE SILVA. J. AND ABEYWARDANE, J.
C. A. APPLICATION 620/80.
FEBRUARY 1,1984.
Land Reform Law. No. 1 of 1972 – Determination to alienate in terms of section24(1) – Subsequent revocation prior to delivery of possession – Exercise ofstatutory power – Discretion – Principles of natural justice – Writ of Certiorari.
The petitioner made an application to the respondent for the alienation by way ofsale of portions of the petitioner's land that had become vested in the respondentunder the Land Reform Law, No. 1 of 1972.
The respondent informed the petitioner that the Minister of AgriculturalDevelopment and Research had in accordance with a recommendation made by theAdvisory Board of his Ministry granted approval to the respondent to alienate thesaid land and called upon the petitioner to refund the proportionate amount ofcompensation already received by him with interest thereon for the portion to bealienated. The petitioner complied with this direction.
The respondent informed the petitioner of the terms and conditions subject towhich the land was being alienated and directed him to take possession of the land.However, subsequently, the respondent informed the petitioner that the Ministerhad revoked the grant of his approval to the said alienation.
The petitioner in this application sought a writ of certiorari to quash the decision torevoke the alienation on the following grounds :
{1) The revocation had been made in violation of the principles of natural justice asthe petitioner was not given a hearing to show cause against it.
A determination to alienate can be revoked only for the causes specified in thestatute.
The respondent has no unfettered discretion to revoke, and
(4j The decision to revoke is a discretion vested in the respondent and not m theMinister
In order to show that a Writ of Certiorari lay to quash the proceedings the petitionersubmitted that the decision to alienate the lands by the respondent-Commissionwas one made in the exercise of a statutory power and was not a matter of a merecontractual obligation.
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Lantf v Land Reform Commission (H. A G de Silva. J.)
I 19
Held –
(1} The respondent-Commission, which is a statutory corporation, in theperformance of its duties exercises the various statutory powers with which it isclothed and does not merely perform a contractual obligation.
The only reason given by the respondent for the revocation of the decision toalienate the land being the withdrawal of the earlier approval given by the Ministerand no opportunity having been given to Ihe petilioner to show cause against theproposed revocation, the decision to revoke the earlier decision to alienate the landwas bad.
The respondent had no unfettered discretion but a discretion to be exercisedsolely for the purposes of achieving the objects of the statute. Such a decision mustbe exercised fairly and in conformity with the principles of natural justice.
Cases referred to
11) Nanayakkara v. The Institute of Chartered Accountants of Sri Lanka and others.(1981) 2 S LR. 52.
Padfieldv. Minister of Agriculture. [1968] 1 AUER. 694. 719
Sinsena v. Senanayake and another – C.A. Application 1103/80 C.A. Minutesof 26 6.1981
APPLICATION for Writ of Certiorari.
Fair Musthapa with N. M. Saheed for the petitioner.
H D A. de Andrado lor the respondent.
Cur. adv. vult.
March 2, 1084
A. G. DE SILVA, J.
This is an application for the issue of (1) an order in the nature of aWrit of Certiorari quashing the decision made by the respondent torevoke the determination made by him to transfer the land calledNedunchenai to the petitioner's children Farhana Latiff and NusrathLatiff, (2) an order in the nature of a Writ of Mandamus directing therespondent to alienate to the petitioner's children the said FarhanaLatiff and Nusrath Latiff. the land called Nedunchenai andSirisumanawatta and place them in possession thereof. At thehearing of this application learned Counsel for the petitionerconfined his submissions to the issue of an Order in the nature of aWrit of Certiorari.
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Sri Lanka Law Reports
(J984] 1 SriL. ft
The facts relied upon by the petitioner's Counsel before us wereas follows
The petitioner's family consisted of himself, his wife, and sixchildren who were in 1972 all under the age of 18 years. Thisfamily owned several allotments of land acquired by virtue ofpurchase and inheritance containing an aggregate extent of 287acres, 3 roods and 20 perches.
By virtue of the operation of the provisions of the Land ReformLaw, No. 1 of 1972, the petitioner became entitled to retain 50acres of the said aggregate extent of 287 acres, 3 roods and 20perches and accordingly an extent of 237 acres, 3 roods and 20perches in excess of the said ceiling vested in the respondent andwas deemed to be held by the petitioner on a statutory lease fromthe respondent. In 1972, the petitioner furnished a 'statutorydeclaration' on the prescribed form in terms of section 18 (1) of thesaid Land Reform Law setting out the total extent of the agriculturalland held by the petitioner and members of his family under a“statutory lease' from the respondent.
In 1974, the respondent published a statutory determination inthe Government Gazette specifying an extent of 50 acres of namedagricultural lands which were permitted to be retained by thepetitioner and as a result the remaining 237 acres, 3 roods and 20perches of agricultural land vested in the respondent. In 1976, thepetitioner received compensation under the provisions of the saidLand Reform Law for the agricultural lands which became vested inthe respondent.
Two of the petitioner's children, Farhana Latiff and Nusrath Latiff,reached the age of 18 years on 2nd February, 1978 and 26thDecember, 1979, respectively and the petitioner thereafter on 7thJanuary, 1980 made an application to the respondent for thealienation by way of sale of 41 acres, 3 roods and 15 perches fromand out of the 237 acres, 3 roods and 20 perches of thepetitioner's land that had become vested in the respondent (PI).
The respondent by letter dated 26th March, 1980, informed thepetitioner that the Minister of Agricultural Development andResearch had in accordance with a recommendation made by theAdvisory Board of his Ministry granted approval to the respondentto alienate to the petitioner's said children this extent of 41 acres, 3roods and 15 perches and that as the petitioner had received
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compensation for the said lands, the petitioner should refund a sumof Rs. 41,000, the proportionate amount of the compensation soreceived with interest, both totalling Rs. 68,328.69 (P2). Thepetitioner paid the said sum of Rs. 68,328.69 on 26th March,1980 (Vide receipt P3).
On 27th March. 1980, by P4 and P4A the respondent informedthe petitioner that the said Minister had approved the alienation bythe respondent to the petitioner's said children two allotments ofland. viz. Nedunchenai of 35 acres in extent and Sirisumanawattacontaining an extent of 6 acres, 3 roods and 15 perches both ofwhich are situated at Puttalam. The annexure P4A sets out theterms and conditions subject to which the said lands were beingalienated in terms of section 24(1) of the said Law. The petitionerwas also directed to take possession of the said land from the LandReform Authority of the Puttalam District. Accordingly on 1st April,1980, the petitioner called at the Madampe office of therespondent Commission and was informed that possession of thesaid lands would be handed over within a few days. However, byletter dated 13th May, 1980, the respondent informed thepetitioner that the said Minister had revoked the grant of hisapproval to the said alienation to the petitioner's said children (P5).'
The Chairman of the respondent-Commission has in his affidavittaken up the position that the recommendation made by theAdvisory Board or the approval of the Minister referred to by thepetitioner has no force or effect in law and further averred that thealienation by way of sale as contemplated by section 22(1) (f) andgiven effect to under section 24( 1) of the said Law is at the solediscretion of the respondent and that in any event such sale has tobe effected by a deed of transfer.
Learned Counsel for the petitioner submits that the revocation ofthe determination to alienate as contained in P5 is bad for thefollowing reasons 1
(1)The revocation has been made in violation of the principles ofnatural justice. Once a determination has been made toalienate the lands, the petitioner gets thereby a legal rightand the respondent cannot revoke such a determinationwithout giving the petitioner a hearing.
Sri Lanka Law Reports
[1984] 1 SriL. ft
122
A determination to alienate can be revoked only for the causespecified in the statute. No reasons have been specified inP5 for the purported revocation nor is it for reasonsspecified in the statute. Hence the revocation has been donewithout jurisdiction.
The respondent does not have an unfettered discretion torevoke and such a revocation could be made, if at all, takinginto consideration relevant circumstances. No relevantcircumstances are disclosed in this instance.
The decision to revoke is a discretion vested in therespondent. In this instance, there has been an abdication ofthe statutory powers vested in the respondent when itpurported to act under the dictation of the said Minister.
The Land Reform Law, No. 1 of 1972, came into operation on26th August, 1972. The objects of the Law are set out in its long
title and it states that the objects of law are inter alia'to
prescribe the purposes and the manner of disposition by theCommission of Agricultural Lands vested in the Commission so asto increase productivity and employment"
Section 3 of the Law places a ceiling on the extent of agriculturalland which may be owned by any person. The word 'person' isdefined in section 66 inter alia to mean a family consisting of thesurviving spouses or spouse and any surviving child or childrenunder the age of eighteen years. Sub-section 2 thereof states that-
'Any agricultural land owned by any person in excess of theceiling on the date of commencement of this Law shall asfrom that date-
la) be deemed to vest in the Commission ; and
(b) be deemed to be held by such person under a statutorylease from the Commission'.
Section 18 requires every person to make a declaration in respectof agricultural land subject to a statutory lease.
The petitioner, his spouse and his six children who were all under18 years of age at that time had agricultural land aggregating 287acres, 3 roods and 20 perches. In terms of the Law as this was in
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excess of the ceiling of 50 acres specified in section 3, the wholeextent of 287 acres, 3 roods and 20 perches vested in therespondent Commission and the petitioner held it under a statutorylease from the Commission. It is common ground that the petitionerdid make the required statutory declaration under section 18 of theLaw.
On receipt of such a statutory declaration the respondent-commission is required by section 19 of the Law to make a"statutory determination' specifying the portion or portions of theagricultural land owned by the statutory lessee which he shall beallowed to retain and this "statutory determination" has to bepublished in the Gazette. The respondent-Commission had madesuch a “statutory determination' specifying an extent of 50 acres ofagricultural land which the petitioner was permitted to retain, andthis "statutory determination' was published in the Gazette. As aresult 237 acres, 3 roods and 20 perches of the agricultural landowned by the petitioner and members of his family vested in therespondent-Commission. Compensation for the land so vested inthe Commission was paid to the petitioner.
Section 22(1)(0 of the Law permitted therespondent-Commission to alienate by way of sale agricultural landvested in the Commission to persons who were minors at the timeof the imposition of the ceiling on agricultural land and whoseparents were dispossessed of such land in excess of the ceiling byreason of such excess having vested in the Commission under theLaw. In terms of this section an application was made by PI on 7thJanuary, 1980, for the alienation by way of sale of 41 acres, 3roods and 15 perches from and out of the extent that had vested inthe Commission, to two of the petitioner's children who hadreached the age of 8 years. Sub-section (3) enjoins theCommission, in determining the person to whom vested land is tobe alienated, that consideration should be given, as far aspracticable, to persons from the administrative district where suchland is situated.
Section 26 of the said Law empowers the Commission, by anotice published in the Gazette, to call for applications in theprescribed form from persons for the alienation to them of anyextent of agricultural land by the Commission. Sub-section (2)states that “any application received by the Commission undersub-section (1) shall be scrutinized by the Commission anddisposed of on its merits".
J 24
Sri Lanka Law Reports
(1984} ) SnL. R.
Mr. Andrado submitted that the application made by thepetitioner for alienation under section 22(1) {f) cannot beconsidered to be an application made in response to a Gazettenotification published under section 26(1) and hence section26 (2) will have no application. A perusal of P 1 seems to indicatethat the application has been made by him in what appears to be aprescribed form as contemplated in sub-section (1) of that sectionwhether it was made in response to a Gazette notification or not.Even otherwise, could one be heard to say that in considering anapplication made under sub-section (1) the merits of theapplication must be taken into account but if an application foralienation is made without a prior Gazette notification, its meritsshould not be the criterion ? Whether the statute spells it or not,surely the merits of such an application must be a vital factor in theCommission's decision to alienate or not, the land, to an applicantand the Commission cannot act capriciously.
Section 24 (1) states that "the Commission may alienate anyagricultural land to any person subject to such terms and conditionsas it may deem fit and as would ensure that such land is vested forthe purpose for which it was alienated " while sub-section (2)empowers the Commission to cancel such alienation where anyterm or condition subject to which agricultural land is alienated isnot complied with. On such cancellation the land re-vests in theCommission.
By P 2 dated 26.03.1980 the petitioner was informed by therespondent-Commission that the Minister of AgriculturalDevelopment and Research had in accordance with arecommendation made by the Standing Committee of the Cabinet,granted approval to the respondent-Commission to alienate to thepetitioner's children the applied for extent of 41 acres, 3 roods and15 perches. It further stated that as the petitioner had alreadyreceived compensation he should refund the proportionate amountof the compensation, viz. Rs. 41,000 with interest, both totallingRs. 68.328.69. This amount has been paid by the petitioner asevidenced by P 3.
Again on 27th March, 1980, by P4 the information given by P3was confirmed while specifying the lands and extent to bealienated. Attached to this letter was P4A setting out the terms andconditions under which the alienation would be made in terms ofsection 24 (1). He was also asked to take possession of the said
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125
land from the Land Reform Authorities of the Puttalarn District.Nevertheless by P5 dated 13th May, 1980, therespondent-commission informed the petitioner that the saidMinister had revoked the grant of approval for the alienation of thesaid lands to his children.
Learned Counsel for the petitioner submitted that the decision toalienate the lands by the respondent-commission was one made inthe exercise of a statutory power and was not a matter of merecontractual obligation. He cited the case of Nanayakkara v. TheInstitute of Chartered Accountants of Sri Lanka and Others (1). Thiscase involved an examination of the question whether therelationship between the employer, a corporate body establishedby statute and the petitioner, an employee of that institution wasone of master and servant and whether a Writ of Certiorari lay toquash the proceedings of an inquiry held by the appointees of theInstitute. The employee’s letter of appointment required theemployee to inter alia comply with regulations contained in theManual of Procedure applicable to such an employee. It was heldthat' an examination of the regulations in the Manual of Procedureshowed that the petitioner's employment had a statutory flavourwhich differentiated it from the ordinary relationship of master andservant. The Manual of Procedure gave rights to the employee andimposed obligations on the employer going beyond the ordinarycontract of service and regulating, inter alia, the grounds andprocedure for dismissal. The requirement that there might be ahearing or inquiry also brought in the requirement that the principlesof natural justice must be observed. The remedy by way of certiorariwas therefore available to an employee '.
A consideration of the various provisions of the Land Reform Lawmakes it clear that the respondent-Commission which is a statutoryCorporation set up under section 43 of the said Law, in theperformance of the duties, that it has been set up to perform, doesso by exercising the various statutory powers it is clothed with, bythe provisions of the Land Reform Law and in particular in making adecision to alienate it is exercising its powers under section 22 andsection 24 of the said Law and is not merely performing acontractual obligation.
Learned Counsel for the petitioner submits that the power ofalienation given by section 22 (1) (c) must be to achieve thepurposes set out in the long title to the statute i.e. one of the
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11984] 1 SriL. R.
objects of the statute. Section 22 (3) sets out statutory guidelinesand section 22 (a) to (g) prescribes the purposes for which landvested in the Commission may be utilised or alienated. It hastherefore a strong statutory flavour.
The respondent-Commission has averred in the statement ofobjections that the power to alienate is at the sole discretion of theCommission but learned Counsel for the petitioner submits that insuch a situation there is a duty cast on the respondent-Commissionto act honestly, with good faith reasonably and in accordance withthe objects of the statute.
H. W. R. Wade on Administrative Law (4th edition), 346, dealingwith the abuse of discretion quotes from the judgment of Rand, J.in a Canadian case in respect of the cancellation of a liquor licenceas follows
' In public regulation of this sort there is no such thing asabsolute and untrammelled 'discretion', that is that action can betaken on any ground or for any reason that can be suggested tothe mind of the administrator; no legislative Act can, withoutexpress language, be taken to contemplate an unlimited arbitrarypower, exercisable for any purpose, however capricious orirrelevant, regardless of the nature or purpose of the statute.Fraud and corruption in the Commission may not be mentioned insuch statutes but they are always implied as exceptions.'Discretion' necessarily implies good faith in discharging public. duty ; there is always a perspective within which a statute isintended to operate ; and any clear departure from its lines orobjects is just as objectionable as fraud or corruption. Could anapplicant be refused a permit because he had been born inanother Province or because of the colour of his hair ? Theordinary language of the Legislature cannot be so distorted. 'Learned Counsel for the petitioner submits that in cancelling thedetermination to alienate the lands, the respondent-Commissionhas abdicated its powers and discretion and has according to P5gone solely on the order of the Minister. No other reason has beenrelied on by the respondent-Commission. In Padfield v. Minister ofAgriculture (2) Lord Upjohn states –
“ that without throwing any doubt on what are well known asthe Club expulsion cases, where the absence of reasons has notproved fatal to the decision of expulsion by a club committee, adecision of the Minister stands on quite a different basis : he is a
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Latilf v Land Reform Commission (H- A G de Silva. J.)
127
public officer charged by Parliament with the discharge of apublic discretion affecting Her Majesty's subjects ; if he does notgive any reason for his decision, it may be, if circumstanceswarrant it, that a Court may be at liberty to come to theconclusion that he had no good reason for reaching thatconclusion and directing a prerogative order to issue accordingly
It has therefore been submitted that there is no unfettereddiscretion to alienate land or revoke such alienation. Revocation canbe before alienation and after determination but must be for causee.g. the Land Reform Law has in section 24 been given the powerto cancel an alienation for violation of the terms and conditions ofthe alienation, i.e., for cause. It has been therefore submitted thatin this instance the revocation of the determination to alienate isultra vires the powers given to the respondent-commission bystatute.
The petitioner also claims that this revocation of the decision toalienate has been made without giving him a hearing, i.e., though itwas the exercise of an administrative function, there was anobligation to follow the principles of natural justice. This submissionis further strengthened by the fact that section 26 (2) enjoins theCommission to decide in regard to alienation on the merits of eachapplication.
Wade in his treatise on Administrative Law at page 444 states-
"The leading speech of Lord Reid in Ridge v. Baldwin is of thegreatest significance because of its extensive review of theauthorities, which inevitably exposed the fallacies into which thedecisions of the 1950s had lapsed. He attacked the problem atits root by demonstrating how the term 'judicial', had beenmisinterpreted as requiring some superadded characteristic overand above the characteristic that the power affected someperson's rights. The mere fact that the power affects rights iswhat makes it 'judicial', and so subject to the procedure requiredby natural justice. In other words, a power which affects rightsmust be exercised 'judicially', i.e. fairly, and the fact that thepower is administrative does not make it any less 'judicial' for thispurpose".
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[1984] 1 SriL. R.
He continues at page 445-
“In a later case Lord Denning M. R. pithily summed up thesituation : 'At one time it was said that the principles.(sc. ofnatural justice) only apply to judicial proceedings and not toadministrative proceedings. That heresy was scotched in Ridge v.Baldwin. At another time it was said that the principles do notapply to the grant or revocation of licences. That too iswrong''
At page 446 he states-
"Although Ridge v. Baldwin sorted out the confusion caused bythe artificial use of the word 'judicial' to describe functions whichwere in reality administrative, it did not eliminate this misnomerfrom the law. A means of doing so. however, has appeared in alater line of cases which lay down that powers of a purelyadministrative character must be exercised 'fairly' meaning inaccordance with natural justice-'which after all is only fair play in
action': administrative powers which affect rights must
be exercised in accordance with natural justice'.
Learned Counsel for the respondent-commission relied on anunreported decision of this Court in C.A. Appln : No. 1103/80 (CAminutes of 26.6.1981). The petitioner had applied for a Writ ofMandamus to give effect to the recommendation made by theAdvisory Board appointed by the Minister to look into injusticesresulting from the operation of the Land Reform Law. This body hadno legal status and it was held that the Land Reform Commissionwas not under any legal duty of a public nature to give effect to therecommendations of that body. In my view the facts of thatapplication are clearly distinguishable from the facts in the instantcase. There the Land Reform Commission had made nodetermination itself, but in the instant case P2 written on behalf ofthe Chairman of the respondent-commission had informed thepetitioner that the Minister had approved the alienation and calledupon the petitioner to pay a specified amount and take possessionof the land. This has been reiterated in P4, i.e.the respondent-Commision had adopted the Minister'srecommendation and had itself made a determination accordingly.
In deciding to revoke the determination to alienate, therespondent-Commission has in P5 given as the only reason for itsdecision the withdrawal of the earlier approval given by the
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Stassen E^^orts Ltd. v. Hebtutabhoy & Co,, Ltd
129
Minister. The respondent-Commission in its statement ofobjections avers that any recommendation made by the AdvisoryBoard or any approval of the Minister has no force or effect in law.This is quite true, but, that is the only reason given in P5 for therevocation of the determination to alienate. No opportunity hasbeen given to the petitioner to show cause against such a proposedrevocation. Though this is an instance of the exercise of anadministrative function there was an obligation on therespondent-Commission to act fairly. It had no unfettered discretionbut a discretion to be exercised solely for the purposes of achievingthe objects of the statute. In this the respondent-Commission hasfailed. In my view the submissions of learned Counsel for thepetitioner are entitled to succeed and I therefore quash the decisionmade by the respondent-Commission to revoke the determinationmade by it to alienate the lands to the petitioner's children ascontained in P5. The application for the issue of an Order inthe nature of a Writ of Certiorari is allowed. Therespondent-Commission shall pay to the petitioner Rs. 315 ascosts of this application.
ABEYWARDENE, J.-l agree.
Application for Writ of Certiorari allowed.