033-SLLR-SLLR-1997-V-1-KARUNADASA-v.-UNIQUE-GEM-STONES-LTD.-AND-OTHERS.pdf
KARUNADASA
v.
UNIQUE GEM STONES LTD., AND OTHERS
SUPREME COURT,
FERNANDO. J„
WADUGODAPITIYA. J. ANDANANOACOOMARASWAMY. J.
S.C. APPEAL NO. 27/96
C.A. APPLICATION NO. 393/95
OCTOBER 14,23 AND NOVEMBER 27. 1996.
Termination of employment of workman (speicl provisions) – Act No. 45 of 1971Sections 2( 1) and 11 of the Act – Labour Commissioner^ order – Natural Justice.
The Commissioner of Labour (2nd respondent) acting on the recommendation ofan Assistant Commissioner (3rd respondent) to whom he had delegated thepower to hold an inquiry, as permitted by Section 11 of the Termination ofEmployment of Workmen (Special Provisions) Act No. 45 of 1971, held that thetermination of services of the appellant workman was contrary to Section 2(1) ofthe Act and ordered his reinstatement with back wages. The 2nd respondentfailed to give reasons for his decision, though requested by the 1st respondentemployer. No material was furnished by the 2nd or 3rd respondent at the hearingof the application for certiorari; nor was the recommendation of the 3rdrespondent produced. The Court was not asked by the 1 si respondent to call forthe record. Neither the 1st nor the 2nd respondent was represented at the hearingin the Court of Appeal.
Held:
Natural Justice also means that a party is entitled to a reasonedconsideration of his case; and whether or not the parties are also entitled tobe told the reasons for the decision, if they are withheld, once judicialreview commences, the decision may be condemned as arbitrary andunreasonable.
The mere fact that the 3rd respondent held the inquiry does not vitiatethe 2nd respondent's order. But the facts, in particular the 2nd respondent'sfailure to produce the 3rd respondent's recommendation, justified theconclusion that there were no valid reasons, and that natural justice had not beenobserved.
Cases referred to:
Padfield v. Minister of Agriculture (1968) A.C. 997.
R. v. Secretary of State, ex. p. Doody( 1993) WLR 154,3 Alt ER 92.
Samalanka v. Weerakoon (1994) 1 Sri L.R. 407.
Brooke Bond Ceylon Ltd., v. Tea, Rubber (etc.) Workers' Union (1973)77 N.L.R. 6.
Ratnayake v. Fernando S.C. 52(86 S.C. minutes 20 May 1991.
Minister of National Revenue v. Wrights' Canadian Ropes Ltd., (1947) A.C.109,123.
Rex v. Civil Service Appeal Board, ex. p. Cunningham (1991) 4 ALL ER 310,543.
Payne v. Lord Harris of Greenwich (1981) 2 ALL ER 842.
Bandara v. Premachandra(fQ94) 1 Sri L.R. 301.
Nagalingamv. de MeHf97S) 76 UL.R. 231.
APPEAL from the judgment of the Court of Appeal.
D. W. Abeykoon, PC., with Ms Nuwanthi Dias for respondent-appellant.
Varuna Basnayake. P.C. with Tyrone Weerakkody and Marina Fernando forpetitioner-respondent.
K.C. Kamalasabayson, PC., A. S. G. with U. Egalahewa. S.C. for 2nd and 3rdrespondents.
Cur. adv. vutt.
December 5, 1996.
FERNANDO, J.
The respondent-appellant is a workman who was employed by thepetitioner-company, the 1st respondent, from 1989. He says thatwhen he reported for work on 30.5.94 he was told that there was nowork for him. He wrote to the 1st respondent on 6.6.94 allegingtermination and asking that he be reinstated. In a reply dated 8.6.94the 1st respondent denied that his services had been terminated,and stated that he was considered to have vacated his post as hehad absented himself from work without cause, and without informingthe 1st respondent.
The appellant then complained to the 2nd respondent, theCommissioner of Labour, under the Termination of Employment ofWorkmen (Special Provisions) Act, No. 45 of 1971, as amended, thatthe 1st respondent had terminated his services in violation of section2 of the Act., and asked for reinstatement with back wages. The 1strespondent denied termination, maintaining that the appellant wasguilty of frequent absenteeism and had vacated his post by reason ofabsence from 23,5.94.
The 2nd respondent says that he delegated to the 3rd respondent,an Assistant Commissioner of Labour, the function of holding aninquiry, as permitted by section 11. At that inquiry several witnessesgave evidence. The 2nd respondent says that, having consideredthe notes of inquiry (which were made available to the parties), andthe 3rd respondent's recommendation (which was not), he approvedthat recommendation and made his order dated 30.4.95,which recorded, without further elaboration, that the appellant'sservices had been terminated contrary to section 2(1) of the Act, anddirected reinstatement with effect from 1.6.95 and back wages ofRs. 13,200. Although by letter dated 19.5.95 the 1st respondentexpressed dissatisfaction with that order, and asked the 2ndrespondent to disclose his reasons, he merely repeated what he hadalready said.
The 1st respondent applied to the Court of Appeal for certiorari toquash the order on the ground that the failure to give reasons was aviolation of the principles of Natural Justice.
The 2nd and 3rd respondents did not furnish any furtherinformation. The 3rd respondent did not produce hisrecommendation, and did not make his record available to theCourt of Appeal, and the 1st respondent did not ask the Court tocall for and examine the record. Neither the 2nd nor the3rd respondent was represented at the hearing in the Courtof Appeal. The Court of Appeal in a well considered order heldthat the 2nd respondent was under a duty to give reasons, citingPadfield v. Minister of Agriculture"1: and R v. Secretary of State,ex p. Doody12'.
The appellant obtained special leave to appeal on the followingquestions:
Has the Court of Appeal erred in taking the view that there is ageneral principle of Administrative Law that Natural Justicerequires the authority making the decision to adduce reasons?
In the instant case, has the Commissioner of Labour held a fairhearing and acted within jurisdiction? If so, is his decision vitiatedby the failure to give reasons?
Is the impugned order (of the Commissioner of Labour) vitiatedby reason of the fact that the 2nd respondent (the Commissionerof Labour) who delivered the order did not hold the inquiry, nordid he give reasons for his decision?
Mr. D. W. Abeykoon, PC, for the appellant submitted that the 2ndrespondent was under no duty to give reasons, citing Samatanka v.Weerakoon™.
“In the absence of a statutory requirement there is no generalprinciple of Administrative Law that Natural Justice requires theauthority making the decision to give reasons, provided that thedecision is made after holding a fair inquiry."
He contended that appellate jurisdiction was different to writjurisdiction. Although there were decisions (such as Brooke Bond
Ceylon Ltd. v. Tea, Rubber (etc.) Workers' Union,'") that theconferment of a right to appeal against a decision implied a duty togive reasons, the same inference, he argued, could not be drawnfrom the availability of the right of judicial review. While concedingthat in other Commonwealth jurisdictions Administrative Law seemednow to be recognising a duty to give reasons, he neverthelessargued that this was not the position in Sri Lanka, in the absence ofstatutory provisions.
Mr. K. C. Kamalasabayson, PC. for the 2nd and 3rd respondentssubmitted, however, that today Administrative Law often didrecognise a duty to give reasons, although there were manyexceptions. He drew our attention to the following extracts fromWade; (Administrative Law, 7th Edition) dealing with “Reasons fordecisions’:
$ The principles of Natural Justice have not in the past includedany general rule that reasons should be given for decisions …Nevertheless there is a strong case to be made for the givingof reasons as an essential element of administrative justice …Unless the citizen can discover the reasoning behindthe decision, he may be unable to tell whether it is renewableor not, add so he may be deprived of the protection of thelaw. A right to reasons is therefore an indispensable partof a sound system of judicial review. Natural Justice mayprovide the best rubric for it, since the giving of reasonsis required by the ordinary man's sense of justice. It isalso a healthy discipline for all who exercise power over
others(at 541-542 cited with approval in Ratnayake v.
Fernando™)
$ Although there is no general rule of law requiring the givingof reasons, an administrative authority may be unable toshow that it has acted lawfully unless it explains itself …Going still further the Privy Council held that a Minister who hadfailed to give reasons for a special tax assessmenthad not shown that it was correct and that the taxpayer’s appealmust be allowed (citing Minister of National Revenue v Wrights’Canadian Ropes Ltd.™). An award of abnormallylow compensation to an unfairly dismissed prison officerby the Civil Service Appeal Board, which made it a rule notto give reasons, was quashed by the Court of Appeal, holdingthat Natural Justice demanded the giving of reasonsboth in deciding whether dismissal was unfair and in assessingcompensation, since other employees were entitled toappeal to industrial tribunals which were obliged by law togive reasons (Rex v. Civil Service Appeal Board ex p.Cunninghamm).
* In a series of cases it has been held that statutory tribunalsmust give satisfactory reasons in order that the losing party mayknow whether he should exercise his right of appeal on a point
of lawthe House of Lords held that a life prisoner was
entitled to be told the Home Secretary’s reasons for rejecting theadvice of the trial judge as to the penal element in the sentence[citing R v. Home Secretary ex p. Doody) (supra) … the Houseof Lords has indicated that if a minister fails to explain adecision satisfactorily, it may be condemned as arbitrary andunreasonable [citing Padfield v. Minister of Agriculture,Fisheries and Food – supra],
* Although the lack of a general duty to give reasons isrecognised as an outstanding deficiency of Administrative Law, thejudges have gone far towards finding a remedy by holding thatreasons must be given where fairness so demands; and thedecisions show that may now be the case more often than not. It hasbeen held at first instance that English Law has now arrived at thepoint where the duty to act fairly imparts at least a general duty togive reasons, subject to necessary exceptions, and this conclusionseems well justified, (at 544-545)
In Doody's case (supra), Lord Mustill explained (at page 111) whyhe was departing from the reasoning in the previous cases. Amongother matters, he said that:
"… even in such a short time as 13 years the perception ofsociety’s obligation towards persons serving prison sentences hasperceptibly changed. Finally because of the continuing momentumin Administrative Law towards openness of decision-making.Sound as it may well have been at the time, the reasoning ofPayne v. Lord Harris of Greenwich™, cannot be sustained today ".
There is an even more compelling reason for Administrative Law inSri Lanka taking a similar stride. As Mr. Kamalasabayson remindedus, Article 12(1) of the Constitution now guarantees the equalprotection of the law. In the context of the machinery for appeals,revision, judicial review, and the enforcement of fundamental rights,giving reasons is becoming, increasingly, an important “protection ofthe law” (see, for instance, Bandara v. Premachadra™) for if a party isnot told the reasons for an adverse decision his ability to seek reviewwill be impaired (cf. Wade, 541-542).
It would seem that in Samalanka v. Weerakoon (supra) the Courtdid not have the benefit of these citations. Further, with respect, it isdifficult to understand why the Court held that there was no duty togive reasons “provided” – and that means if, and only if – "thedecision is made after holding a fair inquiry". What if there had beenno fair inquiry? Then would there have been a duty to give reasons?But if there had been no fair inquiry, the order would have to bequashed in any event – and so the failure to give reasons would nothave been so important in that situation. It seems to me that thequestion whether there is a duty to give reasons is a matter whollyunrelated to the fairness (or otherwise) of the antecedent inquiry.
I must now turn to the questions on which special leave to appealwas granted.
the fundamentals of good administration, and is implicit in therequirement of a fair hearing – were made, and must be understood,in the context of the position of the Commissioner of Labour underthe Termination Act.
The 2nd respondent did not hold the inquiry. He was entitled toact on the basis of the inquiry held, and the recommendations made,by the 3rd respondent: Nagalingam v. de Melm. In that casea perusai of the original record disclosed the AssistantCommissioner's recommendations, on the basis of whichthe Commissioner made the order; and there appears to havebeen no complaint of a lack of reasons. In this case the Court ofAppeal did not have the record or the 3rd respondent'srecommendation.
To say that Natural Justice entitles a party to a hearing doesnot mean merely that his evidence and submissions must beheard and recorded; it necessarily means that he is entitled toa reasoned consideration of the case which he presents. Andwhether or not the parties are also entitled to be told the reasonsfor the decision, if they are with held, once judicial reviewcommences, the decision "may be condemned as arbitraryand unreasonable”; certainly, the Court cannot be asked to presumethat they were valid reasons, for that would be to surrender itsdiscretion. The 2nd respondent's failure to produce the3rd respondent’s recommendation thus justified the conclusion thatthere were no valid reasons, and that Natural Justice had notbeen observed.
The fact that the 3rd respondent held a fair inquiry andotherwise acted within jurisdiction does not excuse the failure to givereasons.
While the mere fact that the 3rd respondent held the inquiry doesnot vitiate the 2nd respondent’s order, the 2nd respondent’s failure togive reasons is all the more serious because it was not he who heldthe inquiry.
The judgment of the Court of Appeal that Natural Justice requiredthat reasons be given must therefore be affirmed.
But that does not end the matter. The legal position was not clearlyappreciated, and the parties do not seem to have realised the needto invite the Court of Appeal to call for and examine the record andthe recommendation. In the course of the hearing in this Court.Mr. Kamalasabayson tendered copies of the recommendation madeby the 3rd respondent, and undertook to make the 2nd respondent'sfile available whenever required. The 1st respondent consented, inthe interest of justice, to the case being re-heard by the Court ofAppeal, after calling for and examining the record and therecommendation. I make order accordingly. There will be no costs. Imust place on record our appreciation of the manner in which Mr.Kamalasabayson assisted this Court.
WADUGODAPITIYA, J. -1 agree.ANANDACOOMARASWAMY, J. -1 agree.Court of Appeal ordered to re-hear the case.