The Attorney General v. Tsang Kwok-kuen
Read the full judgment text of CACC 189/1971 on BabelCite. This Court of Appeal judgment.
2. The facts of the case, in so far as they appear in the Case Stated itself and are relevant to the arguments advanced before us, may be briefly stated. Regulation 17D of the Road Traffic (Registration and Licensing of Vehicles) Regulations (hereinafter referred to as "the Regulations") provides:-
Cited by 2 cases
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CACC000189/1971 IN THE SUPREME COURT OF HONG KONG (APPELLATE JURISDICTION) CRIMINAL APPEAL NO. 189 OF 1971 -----------------
Coram: Rigby, C.J., Mills-Owens & Pickering, JJ. Date of Judgment: 11th June, 1971. ----------------- JUDGMENT ----------------- Rigby, C.J.: This is an appeal by way of Case Stated, brought at the instance of the Attorney General, against the decision of a magistrate in the course of which the magistrate held, inter alia, that 17D of the Road Traffic (Registration and Licensing of Vehicles) Regulations was ultra vires, that the cancellation of the registration of a motor vehicle by the Commissioner of Transport (hereinafter referred to as "the Commissioner") purporting to act under that regulation was invalid and of no effect, and that as a consequence the facts adduced in support of a charge preferred against one TSANG Kwok-kuen, the respondent in this appeal, of permitting the driving of an unregistered motor vehicle, disclosed no prima facie case to answer and accordingly acquitting the respondent. 2. The facts of the case, in so far as they appear in the Case Stated itself and are relevant to the arguments advanced before us, may be briefly stated. Regulation 17D of the Road Traffic (Registration and Licensing of Vehicles) Regulations (hereinafter referred to as "the Regulations") provides:-
3. Regulation on 29(1) provides:-
4. Under Regulation 29(1) there then follow a number of further regulations the effect of which is to prohibit the use of the various types of vehicles therein specified either for the carriage of passengers for hire or reward or for the carriage of goods for hire or reward. 5. Regulation 29(8)(a) provides that in any proceedings under this regulation -
And Regulation 29(8)(b) provides that:-
6. On the 30th October, 1970, the Commissioner, in purported exercise of his powers under Regulation 17D, cancelled the registration of private car No. AP3300. Whether or not the respondent was the person who committed the offence under Regulation 29 on the basis of which the Commissioner purported to cancel the registration of AP3300, is not apparent. On the 30th October, the Commissioner caused to be posted by ordinary mail a letter to the respondent, as the registered owner of AP3300, notifying the respondent that in the exercise of his powers under Regulation 17D the Commissioner had cancelled the registration of this vehicle. The letter so sent was apparently a standard letter of a type habitually used by the Commissioner in all cases - and I emphasize the words "in all cases" - where there had been a conviction under Regulation 29. It was the invariable practice of the Commissioner in all such cases, irrespective as to whether the registered owner was in fact the driver of the vehicle at the time of the commission of the offence, to issue a letter cancelling the registration of the vehicle in relation to which the offence was committed. There was no evidence that the letter ever, in fact, reached the respondent. Remarkable though it may be, however, the fact that the registered owner may never have been informed of the fact of cancellation of the registration of his car is of no avail to him since Regulation 17F. (1), although requiring the Commissioner within seven days from the date of such cancellation by him, to notify the owner of the vehicle of the act of cancellation expressly goes on to provide:-
Nor does the matter end there: the luckless owner, if he should drive the car - or lend it to someone else to drive - after the registration has been cancelled under Regulation 17D, despite the fact that has never been notified of any such cancellation, renders both himself and the unwitting driver of the car, liable to prosecution under Regulation 17F for driving, or permitting someone else to drive, an unregistered motor vehicle. Finally, one may postulate the question as to what would be the position in law, in relation to his policy of insurance, whether it be merely a compulsory third party policy of insurance or a comprehensive policy, of the owner of a private car in the following circumstances: the owner lends the car to a relative or friend who, unbeknown to him, commits an offence under Regulation 29 - an offence such as using the car as a private taxi or picking up, or even soliciting, a passenger for hire or reward; the person to whom the car has been lent is prosecuted and convicted but conceals this fact from the owner of the car; the Commissioner, acting under Regulation 17D, cancels the registration of the car; the owner, either within seven days of the date of such cancellation - the notice of such cancellation not yet having reached him - or, alternatively, long after such cancellation - the Commissioner having omitted to send him a notice of such cancellation (but such omission under Regulation 17F(2) not invalidating the fact of de-registration) drives his car and has a serious accident; that he is liable to prosecution under Regulation 17E for driving an unregistered car - even though he never knew it had been deregistered - is apparent. But is his insurance invalidated by reason of the fact that he has been driving an unregistered car? (Regulation 3 provides that "A vehicle licence shall not be issued in respect of a motor vehicle until such motor vehicle has been registered:). And if his insurance policy is so invalidated, quite apart from the serious financial loss that he may consequently suffer, is he also liable to further prosecution for having driven a car without having the requisite third party policy of insurance in force at the time? These are but some of the problems these unhappy regulations raise. 7. For my part, I accept the argument of the Solicitor General that subsidiary legislation cannot be held to be ultra vires simply because a court may regard it as unreasonable. Different considerations arise where such subsidiary legislation is, in itself not only unreasonable but contrary to natural justice and no express power is contained in the parent legislation enabling this to be done. This distinction was made by this court in the recent case of Lau Ping v. The Queen(1). In that case, this court held that the then existing Regulation 41B of the Road Traffic (Taxis, Public Omnibuses, Public Light Buses and Public Cars) Regulations which compelled the court, upon certain types of traffic offences being proved, mandatorily to order the detention of the vehicle in respect of which the offence had been committed, without giving the owner of the vehicle an opportunity to be heard, abrogated fundamental common law principles that no man shall be deprived of his property without first being given an opportunity of being heard, and in the absence of conferment of such an express power from the parent legislation, was ultra vires the enabling section of the Ordinance under which the regulation itself purported to be made. 8. The crucial question before us is whether Regulation 17D, which enables the Commissioner to cancel the registration of a vehicle or refuse to register it, is ultra vires the section of the Ordinance - Section 4 of the Road Traffic Ordinance - under which it purports to be made. Section 4(1)(b) of the Road Traffic Ordinance provides for, inter alia:-
Section 2(2) of the Ordinance, as amended by subsequent legislation, sets out eleven different classes into which vehicles may be divided for the purpose of registration. 9. Section 4(1)(b) furthers the purpose of classification provided under Section 2(2) by enabling the registration and licensing of those classified vehicles. In so far as registration is concerned, if one looks at the original regulations in their inception they deal with such matters as the manner and method of registration, display of registration marks, change of ownership, cancellation of registration where a vehicle has been broken up or destroyed, and cancellation of a registration where a vehicle has not been licensed for a period of over two years. Under Regulation 17 power is given to the Commissioner to refuse to register a motor vehicle in certain circumstances. Power is also given - and having regard to the enabling provision of Section 4(1)(j) perfectly validly given - to the Commissioner to limit the number of vehicles which may be registered or licensed in certain classes. But, for my part, in the absence of clear words contained in the enabling section itself, I am unable to agree that the power conferred under Section 4(1)(b), as it now stands, to make regulations for the registration of motor vehicles within specified classes, empowers the Governor-in-Council to make regulations enabling the Commissioner to refuse to register or cancel the registration of vehicles which have been used for the commission of an offence - an offence itself created by Regulation 29 - involving the use of the vehicle for a purpose outside the class or category for which it has been licensed. Nor am I satisfied, as contended by the Solicitor General, that it can be said that it was clearly within the contemplation of the Legistlature that regulations for de-registration or cancellation of a registration - what, in effect, is clearly a penal provision - should be an integral part of the general scheme of registration provided for under Section 4 of the Ordinance. Section 4(3) of the Ordinance provides that:-
10. It was contended by the Solicitor General that the registration of a vehicle and the issue of a licence was a privilege and not a right and that, as a consequence, the withdrawal, cancellation or refusal to renew or issue a licence was an administrative act the taking of which was a matter solely for the Commissioner to determine. I am unable to accept that contention. Regulation 6(1) itself provides that upon application for registration of a motor vehicle the Commissioner, subject to the provisions of Regulation 17 shall:-
11. Regulation 7 gives to the Commissioner a discretion to refuse to register any motor vehicle in the circumstances therein provided. It is sufficient to say that those circumstances are irrelevant to the consideration of the matter now before us. Subject, therefore, to the restricted limitations contained in Regulation 17, an applicant for the registration of a private vehicle who has complied with the necessary requirements has a right to have his vehicle registered. Once the vehicle has been validly and properly registered and licensed, to deprive the registered and licensed owner of the right to use that vehicle is a penalty which is not provided for either in Section 4(1)(b) or Section 4(3) of the Ordinance itself. It is directly relevant here to observe that there is in Section 4 of the Ordinance no provision similar to Section 3(1) giving the Governor in-Council power to make regulations for the "seizure, impounding and detention" of vehicles which have been driven or used in contravention of this Ordinance. For these reasons I am of the opinion that the learned magistrate was right in holding that Regulation 17D was ultra vires. 12. I would also hold that the regulation itself is contrary to natural justice in that in the absence of enabling provisions under the Ordinance itself empowering it to do so, it deprives the owner of the motor vehicle of the right to use his vehicle in circumstances in which he may not only be not guilty of the commission of any offence but even unaware that any offence has been committed in relation to his vehicle. That deprivation of property in the past has been habitually made by the Commissioner as a matter of course, consequent upon a conviction for an offence committed under Section 29 in respect of that vehicle, without giving any opportunity to the owner of the vehicle to be heard before he is deprived of the use of his property. There is, furthermore, the fact that coupled with the cancellation of the registration and the deprivation of the right to use his property the owner is penalized monetarily to the further extent that he is deprived of the value of the unexpired portion of his vehicle licence fee. 13. That disposes of the first two questions put before us by the magistrate in the Case Stated. 14. As to the third question postulated by the magistrate it must follow that the learned magistrate was, in my view, correct in holding that the Commissioner's de-registration of the respondent's motor vehicle was invalid. 15. As to question 4(a), it is not disputed - nor, indeed, can it be disputed - that the courts are intended and, where the point is taken, indeed bound, to review subsidiary legislation for the purpose of determining whether or not such legislation falls within the powers conferred upon it by the parent body. As to the question postulated under 4(b) it is, I think, clear that unreasonableness is not in itself a ground for holding that subsidiary legislation is ultra vires; it is only a factor to be taken into consideration when determining whether that subsidiary legislation falls strictly within the powers conferred by the enabling act or ordinance from which such subsidiary legislation derives its existence. 16. The Solicitor General has invited us to express our views upon whether, assuming that the principles of natural justice have not been complied with, what was the effect of the Commissioner's decision to de-register? Was it void ab initio or was it voidable only at the instance of the owner of the vehicle but good as against the rest of the world? In asking us to determine that issue in favour of his own argument that if the principles of natural justice were not complied with then the Commissioner's decision was only voidable and not void, the Solicitor General relies very heavily upon the speech of Lord Up john in the Privy Council decision of Durayappah v. Fernando(2). He submitted that the effect of Lord Upjohn's speech taken together with the speeches of Lord Devlin and Lord Evershed in that case was to decide that a decision of the kind taken by the Commissioner in this case, if it was found to be contrary to natural justice, was voidable only and not void. The Solicitor General then delivered the coup de grace by saying that whatever views this court might have we were bound by the majority decision of their Lordships of the Privy Council in that case. The majority decision of their Lordships in the case of Durayappah v. Fernando(2) has been the subject of considerable adverse criticism, notably of Speight, J. in the New Zealand case of Denton v. Auckland City(3). In the course of his judgment in that case, Speight,J. said that he found it "a little confusing that the same act should or should not be valid according to the locus standi of the person challenging it." He expressed the view that Lord Morris's views in Ridge v. Baldwin(4) had been misinterpreted in the Privy Council case of Durayappah v. Fernando(2) and, in the result, he held in regard to the case then before him that the decision made by the Town Planning Committee was in breach of natural justice and was a nullity. The comment to be found in the Annual Survey of Commonwealth Law 1969 at p.137, in reference to the decision of Speight, J. is:-
17. For my part, having arrived at the conclusion - sufficient for the purposes of this case - that Regulation 17D is, in itself, ultra vires, I decline to be ensnared into the trap laid for us by the learned Solicitor General in venturing to consider whether it might conceivably be possible that what would appear to be the majority decision of their Lordships in Durayappah v. Fernando(2) might be wrong. Like the other members of this Court, and for the reasons stated by my brother Pickering, I would be prepared to consider the point as and when the occasion for its consideration necessarily arises. This is not such an occasion. Representation: G.R. Sneath, S.C., Q.C. & Caird, C.C. for Appellant. Jackson-Lipkin (Johnson, Stokes & Master) assigned for Respondent. (1) (1970) H.K.L.R. 343. (2) (1967) 2 All.E.R. 152. (3) (1969) NZ.L.R. 256. (4) (1964) A.C. 40. IN THE SUPREME COURT OF HONG KONG APPELLATE JURISDICTION CRIMINAL APPEAL NO. 189 OF 1971 -----------------
----------------- Coram: Full Court (Rigby C.J., Mills-Owens and Pickering JJ.) Date of Judgment: 11th June, 1971. ----------------- JUDGMENT ----------------- Mills-Owens J.: This is a case stated, on the application of the Crown, in which the main point which arises is whether regulation 17D of the Road Traffic (Registration and Licensing of Motor Vehicles) Regulations (Cap.220) is within the scope of the power - to make regulations - granted by the Legislative Council to the delegate. Has the delegate exceeded the authority so granted to him, and thus purported to make a regulation which he was not authorised to make? If so, the regulation is ultra vires and of no legal effect. The regulation is of course, an example of subordinate legislation, or, as it is usually called, subsidiary legislation. If validly made, subsidiary legislation has the full force and effect of an Ordinance, whether or not the Ordinance under which it is made provides that it is to have effect as if enacted in the Ordinance itself (see Institute of Patent Agents v. Lockwood (1894) A.C. 347 per Lord Her schell at p.360-1). It is a fundamental distinction, between an Ordinance passed by the Legislative Council and subsidiary legislative, that the validity of an Ordinance cannot (ordinarily) be challenged in the courts whereas the validity of subsidiary legislation may be so challenged (ibid.). Among the grounds upon which subsidiary legislation may be challenged is the ground that it is defective in substance by reason of it being ultra vires - that is to say, outside the scope of the enabling power under which it purports to be made. It must readily be appreciated that the complexity of modern life often entails legislative bodies legislating in general terms, leaving the details of the legislation to be filled in, as it were, by regulations and other such subsidiary legislation. But the principle must always be maintained, that what the delegate does must come within the four corners of the powers vested in him, if it is to have effect as law. Otherwise he is assuming a power to legislate. All this is, of course, well-known, but equally it is of great importance. No one, of course, questions the authority or competence of the legislative body to delegate; generally speaking, the power to do so is unrestricted by law, and it is a matter of policy, not strictly the concern of the Courts, how far it chooses to delegate its authority to enact rules of law by which all persons and things which fall within them will be bound. It is in the matter of ascertaining or establishing the extent of the delegate's authority that difficulties arise, that is to say in construing the scope or extent of the enabling legislation - the legislation under which the delegate derives his power to make the subsidiary legislation in question. It is apparent at a glance that the regulations with which we are concerned were extensively amended and added to in 1969 (by L.N. 99/69) so as to confer drastic powers on the Commissioner for Transport. Instead of, as formerly, being obliged to register any motor vehicle on application, the Commissioner may now refuse registration, for example, if it appears to him to be necessary or expedient so to do in the interests of public safety or the regulation of vehicular traffic in the Colony' - whatever this may mean, or, perhaps more importantly, however this may come to he interpreted (see regulations 6 and 17(1)). Under regulation 18B the Commissioner may, by notice in the Gazette, limit the number of vehicles which may be registered or licensed as public omnibuses, public light buses, taxis or public cars. Under regulation 17C he may designate persons as eligible to be the owners of public light buses. 2. The particular regulation impugned in this case, regulation 17D, is as follows -
3. Regulation 29(1) provides as follows -
The enabling legislation, so far as material, is expressed in the following words of section 4 of the Road Traffic Ordinance (Cap.220) -
First, I would say that subsection (2) of this section must be limited by reference to the matters for which regulations may be made under subsection (1). It is ancillary thereto. Secondly, it will be observed that subsection (1)(b) of the section refers to subsection (2) of section 2. That subsection classifies motor vehicles as goods vehicles, taxis, public cars, private cars etc. etc. for the purpose of registration, and it provides that the class in which any vehicle is registered is to determine 'the purpose for which the vehicle may be lawfully used'. It is the Ordinance itself, therefore, that provides what is to be lawful user of a motor vehicle, by reference to its registered class. But it is the regulations which are to prescribe the contragentions thereof which are to be offences, and, subject to the limits of fine and imprisonment laid down, to prescribe the punishment and penalties to be attached to each such offence (see section 4(3)). It is to be noted that nothing is said in either section 2 or section 4 as to any offence of unlawful user, in the sense of subsection (2) of section 2, that is to say user for a purpose outside the class in which the vehicle is registered. Subsection (2) of section 2 does not make such user an offence, although it says, in effect, that it is unlawful; nor does it provide any penalty for such unlawful user. It could well be argued that no regulation made under section 4(3) could ponalise such unlawful user, because section 4(3) is confined to contraventions of the regulations themselves declared to be offences by the regulations themselves, whereas user outside the registered class is made unlawful by the Ordinance. Nor does section 3(3) assist in this respect - in providing that regulations may be made thereunder for -
There is more than one difficulty about unlawful user, in the sense of use for a purpose outside the class in which a vehicle in registered. We are concerned with regulations made under section 4, subsection (1)(h) of which authorises the making of regulations for carrying into effect the provisions of 'this section', not with regulations made under section 3. Even if one prays in aid section 28(a) of the Interpretation Ordinance (Cap.1) - which provides, in effect, that where subsidiary legislation purports to be made in exercise of a panticular power it shall be deemed also to be made in exercise of all other available powers (so that one might regard the regulations in which regulation 17D appears as being made under section 3 as well as under section 4) - the situation remains that the contraventions which the regulations may punish are contraventions of the regulations, whether made under section 3 or section 4, not of the Ordinance. But this has not been argued and I do not, therefore, propose to make it the basis of my decision in this case. 4. Most of the regulations in which regulation 17D appears were made under previous legislation but were preserved and have effect under the present Ordinance. They provide, as one would expect, the necessary machinery for registration and licensing of motor vehicles. I cannot agree with the contention put forward by the Solicitor General that registration, or licensing, of private cars is in the nature of a 'privilege' which may be withheld. This is not to read the regulations as defining the scope of the enabling legislation, that is to say it is not assuming that because the regulations say that - subject to exceptions as I have indicated earlier - vehicles 'shall' be registered and licensed on application, therefore the enabling legislation must have so intended. It is a case of there being nothing in the Ordinance, as opposed to the regulations, to suggest that registration or licensing is a matter of discretion. On the contrary, it is obviously in the interests of the identification of motor vehicles, and the control of the disposition thereof, that registration was introduced; likewise licensing in the interests of the public revenues; both according to the pattern of the English legislation. The contention that registration or licensing is a more privilege quite simply means that it would be entirely a matter of discretion whether anyone could make use of his vehicle on the roads, so that anyone could inour the considerable expense of the purchase of a new vehicle, of any class, without any assurance that he could so make use of it. If this were to have been the position which the enabling legislation intended, then one would have expected to see, in the enabling legislation, express power to make regulations for curtailing the number of vehicles which may be registered and for restricting also the importation of new vehicles. Further, under regulation 3 of the regulations a vehicle cannot be licensed until it is registered. By section 4(4) of the Ordinance the driving or permitting the driving of an unlicensed vehicle is an offence. Unless licensed, therefore, a vehicle is virtually useless, in Hong Kong, and it can only be licensed if it is registered. The contention put forward by the Solicitor General puts the owner of a car in an impossible position, in my opinion; if the contention is correct, then by withholding registration of a motor vehicle the Commissioner may render it impossible for the vehicle to be licensed and thus entirely prevent the vehicle from being lawfully used on the roads. Such a power would require the most explicit enabling terms to that effect in the Ordinance, In my view, and clearly the Ordinance does not so provide. 5. The power under regulation 17D, to cancel registration and to refuse to re-register, is dependent, according to its terms, on a person being found guilty of an offence under regulation 29. To recapitulate that regulation provides -
It is clear, and it is accepted by the Solicitor General, that in view of the terms of regulations 17D and 29 cancellation of registration and refusal to re-register may follow upon mis-user by any person, not necessarily by the registered owner - whether it is mis-user by an employee, a friend or relative who has borrowed the car, or even a thief. This is a startling situation, to say the least. Then, under regulation 17F the Commissioner should, within 7 days after the cancellation, notify the owner that the registration of his car has been cancelled. But, in the terms of this regulation, the cancellation has effect even if the notification is never given. So that it can very well happen that the owner, or anyone else, will be driving a de-registered car, for a substantial length of time, completely unaware that it is not registered and that he is committing an offence every time he does so. But this perhaps is more a matter of the exercise of the powers purported to be granted by regulation 17D rather than the validity of those powers. I return to this aspect below. 6. It is further argued that section 4(1)(b) of the Ordinance, set out above, in giving power to make regulations for 'registration and licensing' of motor vehicle must be assumed to give power also to make regulations for cancelling registration and refusing re-registration. The Solicitor General supports this argument by reference to section 40(2)(b) of the Interpretation Ordinance (Cap.1) which reads -
The suggestion is that registration is a form of 'authority' or 'approval', so that a condition may be imposed enabling registration to be withdrawn or cancelled, and that such a condition would be a reasonable one if attached to unlawful user of the vehicle. I think that the argument fails for the reasons I have already given on the contention that registration is a privilege, and for the further reason that such a matter as registration and licensing of motor vehicles is not within the contemplation of the provisions of section 40(2)(b); those provisions, in my view, are confined to licences etc. which an empowered person has a discretion to grant or withhold - as the following section, section 41, appears to indicate. Section 41(1) reads:-
7. Regulation 17D is ultra vires also, in my view, by reason of the provisions of section 4(3) of the Ordinance - the penalty provision reproduced earlier in this judgment. Section 4(3), in my view, must be taken to comprehend the totality of the punishment or penalty which may fall upon a person offending against any of the regulations, namely what it lays down - a maximum fine of $1,000 and 6 months imprisonment. In other words, section 4(3) provides for no more than such fine and imprisonment, whereas the regulations as made purport to go further in providing for de-registration as well. This reasoning is to treat the cancelling of the registration of a vehicle, or refusal to re-register, as an additional punishment or penalty not authorised by section 4(3). So, in my view, it clearly is. A de-registered vehicle is, apart from any export value, so much scrap; as a motor vehicle in the Colony it virtually ceases to exist in that, not being registered, it cannot be licensed, and so cannot lawfully be used on the roads. The effect of regulation 17D, therefore, is to introduce an additional punishment or penalty above and beyond the penalties of fine and imprisonment authorised by section 4(3). 8. Then there is the important matter of the impact of cancellation of registration and refusal to re-register. Having regard to the provisions of regulation 29, regulation 17D falls upon the registered owner regardless of any fault, or even neglect, on his part. This must be distinctly realised, as a fundamental proposition. In the case of Lau Ping ([1970] H.K.L.R. 356) I referred to certain authorities on the matter of punishing a person for the act of another. I would repeat the relevant passages, which commence with a reference to the case of Sweet v. Parsley ([1969] 2 W.L.R. 470; [1969] 1 All E.R. 347) where Lord Pearce said:-
The significance, of course, is that if an intention to penalise innocent persons is not lightly to be imputed to the legislature, how much the less is it to be imputed to the legislature that it intends its delegate to have power to make subsidiary legislation having that effect; the intention, that is to say, that all registered owners of private cars, which may possibly be used - even on a single occasion - with or without the owner's consent - for carrying paying passengers, are to be treated as parties to that unlawful user; or unless the intention was to make sure of the guilty owners by penalising all owners regardless of guilt! It must, surely, require the most explicit enabling legislation to empower a delegate to bring about such a wholly unjust situation. No such intention appears in the enabling power, nor in my view can it be construed as implying any such intention. 9. For the foregoing reasons, I hold regulation 17D to be ultra vires. 10. I have not, so far, dealt with the argument that a regulation may be ultra vires because it fails to provide that the rules of natural justice are to be observed in its application or implementation; in particular, in the present case, the argument that regulation 17D is invalid because it fails to require that, before a vehicle is de-registered by the Commissioner, the owner must be given an opportunity to make representations to the Commissioner. I cannot accept, as a general proposition, that where a regulation gives power to interfere with the rights of individuals, it is ultra vires if it does not expressly require the rules of natural justice to be observed. The case of Lau Ping was different in that it was apparent there, from the term of the relevant regulation itself, that the owner was not intended to be heard unless he happened to be in Court when the driver was convicted. Thus there was a vice inherent in the subsidiary legislation itself. The case where the subsidiary legislation makes no such provision, i.e. no provision which in itself shows that the rules of natural justice, or fairness (see Re H.K. [1967] 2 Q.B. 619, and R. v. Gaming Board [1970] 2 All E.R. 528) are to be complied with, is quite a different case. I know of no authority which goes so far as to say that subsidiary legislation affecting persons in their proprietary rights is invalid merely because it fails expressly to say that the rules of natural justice of fairness are to be observed. It is a different matter, however, when one comes to consider regulation 17D in the light of regulation 29. Although it has no bearing on the question of ultra vires, in practice, we are told, cancellation of registration is effected automatically by the Commissioner whenever any person has been convicted of unlawful user of a vehicle, without any hearing or any enquiry as to whether the person convicted is the registered owner or as to whether there is any complicity on his part. Thus the registered owner may lose the use of his vehicle by de-registration although not himself prosecuted or convicted and even though completely innocent of any offence. Surely it should be a condition precedent to de-registration where the person driving is not the registered owner, that he should be convicted for permitting or suffering the vehicle to be so used - which is in fact an offence provided for by regulation 29 - before his vehicle is de-registered. It follows that if it is permissible to read regulation 17D together with regulation 29 then the foregoing affords an additional reason for holding regulation 17D to be ultra vires. In my opinion it is permissible to read these two regulations together inasmuch as regulation 29 indicates the circumstances in which regulation 17D may operate - circumstances of complete injustice to the registered owner, so that it is as if regulation 17D itself contained what I have termed the inherent vice of departure from natural justice or fairness. In Wiseman v. Borneman ([1969] 3 All E.R. 275 at 278) Lord Morris referred to the rules of natural justice in these terms -
In the present case we have the situation, as the regulations are framed, and as they have been exercised hitherto, that registered owners who may be guilty of no fault, or even neglect, have no opportunity to make representations against the cancellation of the registration of their vehicles; cancellation has followed automatically. However, we are now told that an opportunity to make such representations will, in future, be afforded, the Solicitor General giving an undertaking to that effect. But this does not, of course, dispose of the matter of ultra vires. 11. Accordingly I would hold that the answer to the first question put by the case stated is "(1) Yes, the learned magistrate was correct in holding regulation 17D to be ultra vires section 4 of the Ordinance (Cap.220)." 12. Question 2 is in the form -
This I would answer "Yes, in the context"; having I think sufficiently indicated my reasons for so answering this question. It has not been directly contended that cancellation of registration or refusal to re-register is not an invasion of proprietary rights. In this respect Mr. Jackson-Lipkin relied on the case of Cooper v. Wands worth Board of Works ([1863] 14 C.B.N.S: 180), the leading authority to the effect that no man is to be deprived of his property without having an opportunity to be heard, and at this point I would add a reference to the case, in the House of Lords, of Belfast Corporation v. O.D. Cars, Ltd. ([1960] 1 All E.R. 65) where, in effect, it was claimed that planning restrictions which were imposed without a right to compensation were void as being contrary to a provision of the constitution of Northern Ireland which laid it down that the Parliament thereof should have no power to enact legislation to 'take any property without compensation'. Viscount Simonds referred to passages from the judgments of Brandeis J. and Holmes J. in the United States case of Pennsylvania Coal Co. v. Mahon ([1922], 260 U.S. 393 at p.417 and 415 respectively). Brandeis J. said -
Holmes J. said -
In the House of Lords, Viscount Simonds agreed, at p.70, that a measure which is ex facie regulatory may in substance be confiscatory. Viscount Radcliffe refers to the case where a restriction is so extreme as to amount to confiscation. That, I would think, is the position here. 'Ownership' of a chattel, such as a motor-car, is that bundle of rights with respect to it which go to make up ownership, and included therein is the right to make use of the chattel for the purpose for which it is intended. To deprive a person of the use of his motor-car is, surely, to deprive him of a proprietary right. In addition, he is deprived of the value of the unexpired portion of his vehicle licence fee. 13. The third question put by the learned magistrate is whether the de-registration was invalid. Having answered questions 1 and 2 in the affirmative, it must follow that the answer to this question also is "Yes". 14. Question 4(a) asks whether the Courts can review subsidiary legislation; the answer, as the Solicitor General agrees, is obviously "Yes". In this respect, I would add, there is no conflict between the Courts and the Legislature; the Legislature is as much concerned to see that the powers granted by it are not exceeded as the Courts are. 15. Question 4(b) is, in effect, a general question as to whether the magistrate was correct in his decision that the de-registration in this case was invalid. It follows from what I have said in answer to the preceding questions that the answer to this question is "Yes". This question, however, refers to 'unreasonableness' as a test of the validity of subsidiary legislation. So far as I am aware there is no authority directly in point. Reasonableness is a test usually applied to by-laws of local authorities and public corporations and the locus classicus is, of course, the case of Kruse v. Johnson ([1898] 2 Q.B. 91) where Lord Russell of Killowen said, at pp.99-100 -
Unreasonableness, therefore, I conceive to be but an aspect of the doctrine of ultra vires; I accept the argument of Mr. Jackson-Lipkin to that effect, and, if I may do so, I would add that it was the fact of the regulations in the case of Lau Ping (supra) being (partial or unequal' that led me to say that those regulations were void as being discriminatory. 16. There remains the question, not raised by the case stated, which the learned Solicitor General invited us to consider and express our opinion upon. In his judgment, which I have had the advantage of reading, my brother Pickering J. expresses the view that we should not embark on this question. For the cogent and compelling reasons contained in that judgment, I agree that we should not do so. 17. In commencing this judgment I referred to the necessity for maintaining the principle that subsidiary legislation must be confined within the scope of the enabling legislation. The principle is obviously of paramount importance. Subsidiary legislation, incidentally, is not authorised in advance nor, generally, submitted to the Secretary of State for scrutiny, as must be done in the case of Ordinances according to Royal Instructions. Whilst today we are concerned with road traffic regulations, tomorrow we may be concerned with regulations affecting trade, commerce, industry or any other aspect of human affairs. I feel bound to observe that the Law Officers of the Crown, in the present case, have demonstrated a capacity to stretch the enabling power beyond all proper limits. This is not just a matter of a lawyer's exercise. It is an essential part of the rule of law, and it would be a sorry day indeed if the Courts were prepared to dilute their approach in any such case simply because the persons likely to be affected are generally unpopular.
Representation: Sneath, Q.C., & Caird for appellant. Jackson-Lipkin (Johnson, Stokes & Master) assigned for respondent. IN THE SUPREME COURT OF HONG KONG (APPELLATE JURISDICTION) CRIMINAL APPEAL NO. 189 OF 1971 -----------------
----------------- Coram: Full Court (Rigby, C.J., Mills-Owens and Pickering JJ.) Date of Judgment: ----------------- JUDGMENT ----------------- Pickering, J.: The facts of this case have been related with great clarity in the judgment delivered by the learned Presider and to them I do not propose to allude further. I find it pertinent however to recall the highly embarrassing and anomalous position in which the owner and any driver of a de-registered vehicle is unwittingly placed under the system of de-registration which has obtained, between the time of actual de-registration and the receipt by the owner of notification thereof and the very serious consequences, including penal consequences, which may result to those persons. The unhappy position forced upon them by the fact of de-registration coupled with the provision in Reg. 17(F)(1) of the Registration and Licensing of Vehicles Regulations for only ex post facto notification to the owner is compounded by sub-section (2) of that Regulation which provides that failure by the Commissioner to effect the notification contemplated by sub-section (1) shall not affect the validity of the de-registration. It is thus possible under the Regulations for an owner and his driver or drivers to be unknowingly in breach of Regulations 17E, 29 and 44(2) and so to remain until the true position is discovered either upon actual receipt of the Commissioner's notice or, if such notice is not issued or although issued not received, upon the next application for renewal of the vehicle licence which could mean for a period of up to a year. 2. It is only necessary to state that position to render it almost superfluous to pose the question whether such a result could have been in the contemplation of the Legislature when it passed the enabling s.4 of the Road Traffic Ordinance (Cap.220). Clearly no responsible Legislature could ever have intended to place members of the public who may well be entirely blameless, in such jeopardy. On this ground alone I would hold Reg. 17D, read in its context, to be ultra vires. 3. Quite apart from the Regulation not being within the contemplation of the Legislature it is also ultra vires as I see it as lying outside the rule-making power. Nowhere within the confines of s.4 of the Road Traffic Ordinance is there to be found an express power to de-register vehicles and if it be argued that a power to de-register is implicit and proper in a registration scheme that proposition cannot be extended, in the absence of express provision in the Ordinance, to the imposition of penalties additional to those authorised in the Ordinance. Section 4(3) of the Road Traffic Ordinance provides that :-
4. There is nothing there about the additional penalty of de-registration still less about de-registration of the vehicle of an innocent owner. Section 17D is, in terms, unrelated to the offender since its impact is upon the registered owner who may well not be the person who, in the words of Reg. 29, has driven, used or permitted or suffered the vehicle to be driven or used for a purpose other than that for which it is registered. Where it is in fact the registered owner who is guilty of a contravention of Reg. 29, the effect of Reg. 17D is to render him liable to double punishment in that he may suffer the fine and/or imprisonment authorised by s.4(3) of the Ordinance and also have heaped upon him the de-registration of his vehicle. There is no warrant for such double penalty in the Ordinence. I have used the word "penalty" partly because the learned Solicitor-General, in the final stage of the three-day submissions in this case, said that if the Court considered that Reg. 17D imposed a penalty or sanction he would concede that the regulation was ultra vires. In the course of the discussion there had been a certain amount of emphasis upon the word "penalty" and it was argued for the Crown that de-registration was not a penalty. I venture to think however that there is no particular magic in the word for it does not occur in ss.(4) of the enabling s.4 of the Road Traffic Ordinance and where it occurs in ss. (3) thereof the reference is to "punishment and penalties" and both sub-sections prescribe as a maximum the imposition of a fine of $1,000 and imprisonment for 6 months. Nothing further is contemplated anywhere under s.4. But the effect of de-registration upon an owner is to burden him with a disability, a disadvantage, a detriment, a sanction; the label is unimportant. The effect is to deprive him of the enjoyment of his property in the form of his vehicle and the unexpired portion of his road licence and that, irrespective of whether the deprivation can properly be termed a "punishment" or a "penalty", goes further than the sanctions authorised by the enabling section. It is a stretching of statutory authorisation in favour of executive expediency and is, for this second reason also, ultra vires. 5. It was further Mr. Jackson-Lipkin's contention that Reg. 17D, as framed, is contrary to the rules of natural justice and with that argument I would also agree. In very recent years there has been considerable development in the field of Administrative Law with emphasis upon the concept of natural justice and frequent reference to the principle of audi partem alteram. The old distinction formerly frequently drawn between the position where an administrative body was acting purely administratively and that in which its function was quasi-judicial (it being said that in the former case the rules of natural justice had no application, though being attracted in the latter case) has crumbled and the modern tendency is to hold that in both circumstances there is an obligation to act in accordance with natural justice which term the recent cases tend to define in starkly simple terms. Thus Lord Morris in Wiseman v. Borneman(1) said:
6. In R. v. Senate of University of Aston(2) Donaldson J. spoke of "Common fairness ............ which is all that natural justice is" and in the same case Blain J.(3) said that "Common fairness" demanded an opportunity for representations to be made by or on behalf of the applicants in that case. In Schmidt v. Secretary of State(4) Lord Denning M.R. having said:
went on to observe that the distinction formerly existing between circumstances in which the Home Secretary was exercising on administrative power and those in which he was performing a judicial act no longer existed. 7. Applying the principles highlighted by these brief extracts from recent decisions, can it be said that Reg.17D as framed conforms to natural justice? I think not. It places no obligation whatever upon the Commissioner of Transport to act fairly in de-registering a vehicle. It imposes no necessity even to warn the owner of the vehicle concerned still less to give him an opportunity of being heard before the de-registration is effected. The guilt or innocence of the owner is rendered irrelevant as is the fact that according to the terms of the vehicle's insurance policy, it may have become uninsured though still liable to be driven by persons nescient of the de-registration. By failing to circumscribe its application to the guilty and by omitting any provision for notice and a hearing, the Regulation offends against natural justice for no mere question of the termination of a privilege is involved an owner being entitled to have his vehicle registered if the Commissioner is satisfied with the particulars contained in his application and if the provisions of Reg.17 do not apply; subject to those two conditions the duty of the Commissioner to register the vehicle is mandatory under Reg.6(1). 8. The situation in regard to natural justice, or the lack of it, is on all fours with that which obtained in the case of Regina v. Lau Ping(5) where the efficacy of the former Reg.41B of the Road Traffic (Taxis, Public Omnibuses, Public Light Buses and Public Cars) Regulations, relating to the mandatory detention of vehicles in certain cases, was challenged. In that case the learned Chief Justice said(6):
9. Those words are equally apt in the present situation and I need say no more on this issue of natural justice. 10. The answers to the first two questions posed by the learned magistrate are therefore in the affirmative; that is to say, Reg. 17D is ultra vires and the rules of natural justice are applicable to it - which indeed is one, though only one, of the reasons for holding it ultra vires. 11. In the light of the answers to these first two questions, it seems to me that the replies to the questions remaining fall naturally into place. The learned magistrate's third query is whether he was correct in holding that the Commissioner's de-registration of the defendant's car was invalid. This issue having been fairly and squarely raised before the magistrate it matters not whether the de-registration was a nullity or merely voidable. It was being challenged and the Regulation having been found to be ultra vires and contrary to natural justice, it was clearly right to hold the de-registration invalid. 12. The fourth question posed was sub-divided. The learned magistrate asks first if the Courts of the Colony can review subsidiary legislation. The Crown concedes that if the Courts are to perform their functions as Courts they can so review. It is then asked if the Courts can hold subsidiary legislation to be unreasonable and that must follow if only because reasonableness is one of the tests of vires. Finally the learned magistrate asks if he was correct in law in holding Reg.17D to be unreasonable and invalid. I have already affirmed the correctness of his decision in regard to invalidity and it is patent for the reasons which I have stated in regard to vires and natural justice that the magistrate was equally correct in holding the Regulation unreasonable. 13. Accordingly I would answer all the questions put to the Court in the case stated in the affirmative and uphold the learned magistrate's decision. 14. A further matter of considerable importance remains. The learned Solicitor-General described the issue of whether the de-registration in this case was a nullity or merely voidable at the instance of the registered owner, as the most interesting point raised but added that is was less important than that of the validity or otherwise of the Regulation upon which point he sought a ruling. He conceded that if the action of the Commissioner was either a nullity or merely voidable the de-registration must now be of no effect as against the registered owner but, arguing that the de-registration was voidable only, claimed that until the registered owner had taken steps to have it set aside it was good as against the whole world. As I understood him, the learned Solicitor-General invited this Court to rule upon the issue of nullity or mere voidability oven if that issue should become strictly superfluous as a result of our finding the Regulation ultra vires. There was, he said, considerable general interest inasmuch as so many powers of this type existed under subsidiary legislation in the Colony. 15. For my part I must decline to undertake an academic exercise the results of which would in any event be merely obiter though apparently intended to be heavily relied upon by the Crown. My learned predecessor Macfee J. put the matter bluntly but aptly when in Attorney General v. Man Chi Kin and another(7) he said "after all, this is a Court of Justice, not an academy of law". It may be that having at one time been a member of a Court of final instance (not in Hong Kong) invested with the power to issue declaratory judgments, I am more sensitive about deciding matters not strictly germane to the issue before the Court than others. A declaratory judgment meant simply a judgment based upon a set of hypothetical facts put before the Court by the High Commissioner of the territory concerned. It was a power which members of a multi-national Court with different legal backgrounds universally disliked and one which they endeavoured to circumscribe both as to the requency with which it was invoked (twice during my four years with the Court) and as to the particular hypothesis posed when it was invoked. I do not conceive however that this particular experience renders me unique in a reluctance to embark upon exercises of the nature proposed. The dangers of superogatory pronouncements are well know and the embarrassment which they, though obiter, can occasion when second and wiser thoughts prevail, notorious. 16. Another consideration is that so far as the Crown is concerned the exercise would be academic in a very real sense in that so far as this Regulation is concerned it makes little practical difference whether the Commissioner's action was a nullity or merely voidable. If the de-registration was a nullity and if owners of vehicles which have in the past been de-registered in similar circumstances consider that there was something tortious in such de-registration they could test that issue immediately before the Courts. If however the de-registration was held to be merely voidable it would still be open to such owners to obtain a declaration (possibly in one representative action or as a result of a test action) that the de-registration was void ab initio when they would thereafter be enabled to test the tortiousness or otherwise of the de-registration in the same way. 17. If it be argued that such owners need to know whether the de-registration be a nullity or merely voidable before they can decide whether it is open to them to sue directly in tort or whether they must first obtain the declaration to which I have referred, I think that the answer is for them either individually or in a representative or test action to sue for both remedies. Indeed it may be unnecessary to sue for a formal declaration and open to the Court in an action for tort to rule upon the question of nullity or merely voidable when, if either such conclusion was reached, the action of the Commissioner would become void ab initio. At the stage of such an action, should it ever be reached, the Courts would be properly seized of this issue with the relevant facts of the relevant cases before them but for my part I would be reluctant to cross this bridge before I come to it, slow to decide this issue in vacuo. 18. It was the learned Solicitor-General who invited the Court to pursue this topic and in deference to his wish, Mr. Jackson-Lipkin advanced his own views upon the subject. I am not ungrateful for the proffered assistance upon the problem nor unmindful of the research upon both sides which went into it. Indeed throughout the whole of this case the Court has had the advantage from both sides of lucid and skilful exposition of all the issues involved. Nonetheless I must decline to tread this particular path which cannot lead to any conclusion really useful, let alone essential, to either of the parties in this particular case. If and when the time comes that this issue of nullity or merely voidable is before me either at first instance or as a member of this Court, I shall be happy to explore it. Until then, I prefer not to be led into provisional expressions of opinion from which I may later, in the context of a case where the issue is a live one, wish to resile. 19. In its last analysis the invitation of the learned Solicitor-General is an attempt to persuade this Court to follow a decision of the Privy Council (Durayappah v. Fernando(8)) in which a decision as to whether the administrative action the subject of appeal in that case was a nullity or merely voidable, rested partly upon what appears to be a faulty analysis by Lord Upjohn of the judgment of Lord Morris of Borth-y-Gest in Ridge v. Baldwin(9). Certainly that analysis has been the subject of severe subsequent criticism (see the judgment of Speight J. in Denton v. Auckland City(10) and that of Megarry J. in Hounslow v. Twickenham Garden(11) and even the learned Solicitor-General was constrained to refer to "the privilege of the Privy Council to be wrong but binding". In my view the time has not yet come for this Court to saddl itself with a decision so described. Representation: (1) (1969) 3 W.L.R. @ 711 (2) (1969) 2 A.E. @ 975 (3) (1969) 2 A.E. @ 978 (4) (1969) H.A.E. @ 908/909 (5) (1970) H.K.L.R. @ 343 (6) (1970) H.K.L.R. @ 350 (7) (1964) H.K.L.R. @ 490 (8) (1967) 2 A.E. 152 (9) (1963) 2 A.E. 66 (1964) A.C. 40 (10) (1969) H.Z.L.R. 256 @ 268 (11) (1970) 3 A.E. 326 @ 347 |
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