Wong Kwong Shing t/a Ka Wah Motors Co v. Attorney General

HCMP000212/1975

IN THE SUPREME COURT OF HONG KONG

(ORIGINAL JURISDICTION)

MISCELLANEOUS PROCEEDINGS NO. 212 OF 1975.

-----------------

-----------------

-----------------

Coram: Huggins, J.

Date of Judgment: 30th October 1975.

-----------------

JUDGMENT

-----------------

1. The Plaintiff desires to operate a fleet of public light buses. On 20th February 1975 he submitted to the Commissioner of Transport an application for the registration and licensing of each of fifty such buses. It is conceded that those applications were in order and that the vehicles complied in all respects with the regulations then in force. Nevertheless on 12th March 1975 the Commissioner refused all fifty applications "in the exercise of [his] powers and duties under regs.18B and 17(2) and/or alternatively reg.17A(1) of the Road Traffic (Registration and Licensing of Vehicles) Regulations, Cap. 220". The Plaintiff complains of the refusals and seeks his remedy in the form of declarations against the Attorney General. Basically his case is that, because he has complied with all the prerequisites laid down, the registration and the grant of licences must follow as a matter of right and not of privilege. He relies upon the decision of the Full Court in Attorney General v. TSANG Kwok-kuen 1971 H.K.L.R. 266, where Mills-Owens, J. said at p.281:

"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".

As to reg. 18B, which relates to the limitation of the numbers of vehicles which may be registered and licensed, the Plaintiff says that he applied before any limit was imposed and that his applications fell to be considered in the light of the circumstances prevailing on the date they were lodged: they were not continuing applications but ones made once and for all on 20th February and giving him on that date accrued rights to the registration and licensing of his vehicles.

2. No formal reasons were given by the Commissioner for his refusals and we are left to infer that, at least in part, he based his refusals on a limitation imposed by a notice in the Gazette pursuant to reg.18B, but whether that was the basis of his refusals in so far as the Commissioner relied upon reg.17A(1) we do not know: as I understand it, the Commissioner claims that that regulation gave him an absolute discretion to refuse the Plaintiff's applications. If it does, then the Plaintiff contends that it must be ultra vires. The Governor in Council was empowered by s.4(1)(b) to make regulations for

"the registration and licensing of motor vehicles within the classes referred to in sub-section (2) of section 2 or any division of any such class".

Regulation 17A is in these terms:

"(1) Without prejudice to regulation 17 and to any other enactment, on an application for registration of a motor vehicle as -

the Commissioner may refuse -

Mr. Zimmern submits that this "purports to give power to the Commissioner to refuse to register certain classes of vehicle". I do not think it goes as far as that: it merely gives him power to refuse to register individual vehicles within the specified classes. It does, however, purport to go further than reg. 17(1), which authorises the Commissioner to refuse to register a motor vehicle for certain specified reasons. The fact that there is a conflict between reg.6 (which makes registration mandatory, "subject to the provisions of reg.17", where the Commissioner "is satisfied with the particulars in the application" - whatever that may mean) and reg.17A (which gives a wider discretion) does not assist the Plaintiff: the two provisions are of equal standing and must be read together. The fact remains that the Full Court in Attorney General v. TSANG Kwok-kuen held that reg.17D, which purported to permit the Commissioner to cancel the registration of a vehicle in relation to which any person was convicted of an offence under reg.29, was ultra vires as being in breach of the principles of natural justice. It seems to me that the argument advanced on bahalf of the Defendant does not give due weight to that decision. What Mr. Johnson submits is that s.4(1)(b) necessarily gave power to make regulations under which the Commissioner could prohibit the registration of motor vehicles within any of the classes: he says that regulation of the registration of motor vehicles can include the prohibition of registration of some motor vehicles. Why then was it thought necessary to give specific power to make regulations limiting the number of vehicles which may be registered in a particular class? In Slattery v. Naylor (1888) 13 A.C. 446 there was power to regulate the burial of the dead and it was held to be intra vires to prohibit burials in an area which included an existing burial ground. That, however, was very different from prohibiting the burial of particular corpses altogether, and that is the analogous situation which the Defendant seeks to support here. The Mayor etc. of the City of the City of Melbourne v. Barry (1922) 31 C.L.R. 174 equally supports the Plaintiff rather than the Defendant, as do Toronto Municipal Corporation v. Virgo 1896 A.C. 88 and Tarr v. Tarr 1972 2 All E.R. 295. Mr. Johnson principally relies upon observations of Lord Halsbury, L.C. arguendo in Attorney General for Ontario v. Attorney General for the Dominion of Canada (1896 A.C. 348), which can be found quoted at (1916) 22 C.L.R. 348:

"Trade generally may be regulated by prohibiting a particular trade. Take the case of the prohibition of the exportation of wool with which this country was familiar at one time. That was a regulation of trade, and it was a prohibition of a particular trade".

Again, I do not think that assists the Defendant here, where what is to be regulated is not "road traffic" or "the registration and licensing of motor vehicles" but "the registration and licensing of motor vehicles within the classes etc.". The Commissioner is thereby empowered to regulate the registration and licensing of motor vehicles within the class of public light buses but cannot prohibit the registration and licensing of additional motor vehicles within that class altogether. Hookings v. Director of Civil Aviation 1957 N.Z.L.R. 929 was a different case entirely. There the Governor General by order in Council prohibited the use of aircraft for towing or, while in flight, for picking up specified articles without the prior permission of the Director of Civil Aviation. The power granted to the Governor General was to make regulations "generally for regulating civil aviation" and it was declared that that included regulations "making provision .... Generally for securing the safety, efficiency, and regularity of air traffic and the safety of aircraft and of persons and property carried therein, for preventing aircraft endangering other persons and property ......". It was held that the regulation was intra vires because, although it did prohibit some forms of aviation without permission, they constituted only a small part of all air traffic and the prohibition was in order the better to regulate and make safe the whole. Mr. Johnson relied upon the statement at p.934

"that all regulation imports some degree of prohibition, and that, in regulating the whole, it may be necessary to prohibit a part only".

Again, the decision does not assist him. In the present case "the whole" is the registration and licensing of motor vehicles within the class of public light buses and that is not regulated by prohibiting the registration and licensing of a possibly large number of vehicles within that class altogether. I have therefore come to the conclusion that reg.17A was ultra vires.

3. It remains to consider whether the Commissioner was entitled to refuse the Plaintiff's applications on the alternative ground. On behalf of the Defendant it is contended that the Commissioner had no alternative but to refuse the applications as a matter of law, because on 21st February 1975, i.e. the day following the Plaintiff's applications, by a notice published in the Gazette, he lawfully limited "to a maximum of 4,331 the number of motor vehicles that may be registered or licensed as public light buses". There is an affidavit which says that instructions for a limitation of this kind had been given by the Commissioner in or about July 1974, but counsel for the Attorney General has sensibly not attempted to persuade me that that is anything to the point. No point has been taken that the notice was defective in that by referring to the "number" (in the singular) it did not indicate whether what was limited was the number of motor vehicles that might be registered or the number of motor vehicles that might be licensed: if both the number of motor vehicles which might be registered and the number of motor vehicles that might be licensed were intended to be limited the word ought grammatically to have been in the plural form. What has been argued is that any application still pending when the limitation was made on 21st February 1975 was not automatically caught by the limitation to the same extent as would have been an application not lodged until after the limitation had been made. It is implicitly conceded on behalf of the Attorney General that if the nature of these applications had been such that they could have been dealt with instantly "over the counter" then there might have been ground for saying that any delay in granting the licences could not have resulted in the Plaintff's being disentitled to what he now seeks, but Mr. Johnson says that, as it is common ground that there was no unreasonable delay - or at least that there had been no unreasonable delay up to 21st February 1975 -, the Commissioner was bound by the regulations to refuse the applications.

4. The Plaintiff contends that his fifty applications could not be prejudiced in any way by a limitation made after they had been duly lodged, even if 4,331 public light buses were already registered and licensed on the day when the notice appeared in the Gazette, for he had an accrued right to the grant of his applications on 20th February. He goes further and says that even if that be wrong it has not been proved that there were not 4,281 or less public light buses registered and licensed at the material time. For some strange reason the only evidence given on behalf of the Commissioner in relation to the number of registration states "the number of public light bus licences registered" "at the date of this affirmation", i.e. 13th September 1975. Mr. Johnson had to concede that that evidence was irrelevant - even if, as was assumed, it was intended to refer not to the licences registered (which makes nonsense, although reg.18B(2) also refers to "registration .... of a motor vehicle licence") but to the vehicles registered, and possibly to the vehicles licensed, as public light buses. Mr. Zimmern submitted that it was for the Commissioner and not for his client to prove the number of vehicles registered and licensed as public light buses on the material date.

5. The Plaintiff does not complain of reg.17(2) and rightly so: s.4(1)(j) has been added to the Ordinance and duly authorises a provision in the terms of that regulation. What is here attacked is reg.18B, which reads as follows:

"(1) Without prejudice to any other enactment the Commissioner by notice in the Gazette may limit the number of motor vehicles which may be registered or licensed as -

of vehicles within any class of motor vehicle which is referred to in paragraph (1);

The Commissioner may cause the applications to be determined by lot."

Mr. Zimmern contends that the regulation must be regarded as an indivisible whole. If that be right there can be no doubt that the regulation raises great difficulties. Mr. Zimmern suggested a number of such difficulties. He said that para.(2) appeared to contemplate the fixing of a limit at a figure below the number of current registrations or licences. Although there would be no immediate injustice, grave injustice might result if a registered vehicle were damaged beyond repair, because it could not automatically be replaced and the replacement registered. Moreover, as existing licences expired it would become impossible for some registered owners to renew their licences: although the registration might remain unaffected, para.(2) would not save a licence beyond its expiry date and there might be registered vehicles which could not be licensed. But for para.(2) I think para.(1) could properly be interpreted as authorising only the fixing of limits not lower than those existing at the date of the notice in the Gazette. Indeed, Mr. Zimmern says that he has no quarrel with para.(1), but he says we do not know upon which part of reg.18B the Commissioner relied in reaching his decision nor do we know the number of motor vehicles registered and licensed as public light buses on 21st February. In my view I am entitled to assume that the Commissioner relied upon para.(1) and not upon paras.(2) and (3), because para.(2) is not an enabling provision at all while para.(3) is concerned only with a possible consequence of a limitation imposed under para.(1) - any refusal of an application after the holding of a lottery under para.(3) would still be by virtue of para.(1). I see no reason why the court should not sever part of a regulation which is ultra vires and which is capable of severance. For the purposes of this case I will assume that para.(2) is so contrary to the principles of natural justice that it is ultra vires, but I must still decline to declare paras.(1) and (3) to be so tainted. It is not necessary for me to decide precisely what the Legislature had in mind in enacting s.4(1)(j). It may well be, as Mr. Zimmern submits, that it was contemplated that the Commissioner would always give reasonable warning of the imposition of a limit. However, if the regulation is within the four corners of the statute I must give effect to it although I may think that the Legislature would not have so expressed the delegated power had it foreseen the use that would be made of it. That is why it is important that the Legislature should always look with special care at any delegation of power: as Lord Wilberforce once said, it is ill-advised to assume that delegated powers will invariably be exercised wisely and fairly. Even assuming that circumstances might arise which could justify the imposition of a limit without reasonable notice (regardless of the fact that that might ruin one or more aspiring operators), it is hard to believe that it was right to impose a limit which would defeat applications already lodged. However, I am here concerned with the law and not with morals and in my view there was no restriction on the Commissioner's power which would have prevented his applying the notice of 21st February 1975 to the Plaintiff's applications. It is not necessary to decide whether the number could be limited below that of vehicles registered or licensed at the date of the notification, as there is no evidence that this is what has happened here.

6. Whether or not we know the numbers of motor vehicles registered and licensed as public light buses on 21st February is an altogether different matter and cannot affect the validity of the regulation, although it might possibly affect the validity of the notice. That issue has not been raised directly, but it is contended that, unless the Commissioner proved that a limit lawfully imposed had been reached before the Plaintiff's applications were rejected, those applications should have been granted. Mr. Johnson did not concede that the burden of proof was on the Commissioner but he did not argue the contrary. I would agree that for the purpose of establishing the right referred to by the Full Court in Attorney General v. TSANG Kwok-kuen the Plaintiff did not have to adduce evidence that the limit had not been reached. However, I cannot accept Mr. Zimmern's submission that this right was an accrued right to have licences issued (which would have entitled the Plaintiff to licences dated 20th February 1975): it was only a right to have the applications granted in due course unless there were some good ground upon which the Commissioner might properly refuse. For example, the Commissioner was not bound to register and license an unroadworthy vehicle and he was entitled to a reasonable time in which to satisfy himself that the vehicle was roadworthy. (A refusal to register on the ground of unroadworthiness would presumably be by virtue of reg.17(1), which is not in question in the present case.) In my view the Commissioner clearly ought, for reasons similar to those which I gave in CHAN Yat-san v. Attorney General M.P. No.27 of 1975, to have expressed the grounds on which he refused the applications, but, as I have already indicated, the reference to reg.18B made it sufficiently clear that he was, rightly or wrongly, relying upon the limitation. Once the Commissioner gave a reason which was not manifestly bad the burden passed to the Plaintiff to show that the reason was insufficient. It is not necessary to decide what was the material date for determining whether the Commissioner was entitled to refuse the Plaintiff's applications on the ground that the lawful limit had been reached, but it could not have been after 12th March 1975, the date on which the applications were refused. It is remarkable that the affidavit of Mr. CHEUNG Yuk-yin, which was the only evidence filed on behalf of the Defendant, did not expressly allege that the applications were refused because of the limitation imposed by the notice of 21st February 1975 and gave figures for a manifestly immaterial date. If one were to take the figures contained in that affidavit as being the figures on the material date, they showed that the Commissioner could not lawfully have refused all the Plaintiff's applications out of hand, but would have been required to hold a lottery under reg.18(3). However, there is no justification for assuming that the figures on the material date would have been the same as, or less than, those given. It was the Plaintiff who sought to say that the Commissioner was not entitled to refuse his applications on the ground that the limit had been reached and it was for him to adduce evidence in support of his allegation. Such evidence was readily available and could if necessary have been obtained with the assistance of the court.

7. If the Plaintiff had established that this(the only) reason given by the Commissioner for his refusals was bad I might have had to consider the validity of reg.17F, which purports to relieve the Commissioner of the usual consequence of failing to give reasons, but in the result that is unnecessary. The Plaintiff is entitled to the declaration he prays for in relation to reg.17A but, in my view, he is not entitled to the other declarations which he seeks.

******

8. It has been pointed out to me that there was a misunderstanding. When Mr. Johnson started his reply he informed me, with the consent of counsel for the Appellant, of the state of the Register in relation to public light buses on 20th and 21st February 1975: there were 4,289 motor vehicles registered as such and "there were then eight committed registrations". It was apparently intended that I should treat this information as evidence in the case, thus avoiding the necessity of the Plaintiff's seeking to file further affidavits. Mr. Zimmern now accepts that I should regard the "committed registrations" (whatever that might mean) as though the registrations were complete, so that for the purposes of this case there were 34 "vacancies". The result is that the Plaintiff should also have a declaration that he is "entitled to have 34 of the vehicles in respect of which application was made to the Commissioner for Transport for their registration on 20th February 1975 duly registered as public light buses under and in accordance with the provisions of the Road Traffic Ordinance". That does not, of course, mean that they should be registered as at 20th February 1975.

30th October 1975.

Representation: