Judgment

Gopal Sri Ram, JCA

1. This appeal was heard and allowed on November 23, 2004 for the reasons now produced. The facts are relatively simple. The appellant operates a rubber factory in Sungai Petani, Kedah. The factory has been in operation since 1940. Each year the appellant applied for and obtained a licence from the local authority. In 1974, the Environmental Quality Act ("the EQA") came into force. By reason of its provisions, the appellant had to obtain a licence from the Department of the Environment, Kedah. After the EQA came into force, the appellant applied for and were issued the requisite licence by the department. Then a problem arose in 1993 when the appellant applied for their 1994 licence. It happened in this way.

2. In November 1993, the appellant applied for the licence as it had done in the preceding years. It filled up the prescribed form and submitted it with the processing fee ofRM250. The first respondent, the Director of Environment for Kedah and Perils responded in mid-February 1994. He wrote, saying that according his department's records the appellant's land had not been converted from agriculture to industry and for that reason the appellant's application for a licence could nor be considered. The first respondent also drew the appellant's attention to s 18 of the EQA which made it an offence to operate a factory without a licence. There was then an exchange in correspondence culminating in the appellant's solicitors sending to the first respondent a copy of the judgment of KC Vohrah J in OM No 32-33-1987 (High Court Alor Setar) between the appellant in the instant appeal and the State Director, Kedah and the Land Administrator, Kuala Muda, Sungai Petani, Kedah where that learned judge held that the appellant had not infringed the condition of the issue document of title to their land. In other words, there was no necessity for the appellant to apply for a change of land user. The solicitors' letter which is dated February 21, 1994 also said that it would be contrary to law for the first respondent not to issue the appellant the licence it had applied for. On March 6, 1994 the first respondent wrote to the appellant's solicitors calling for a meeting on March 26, 1994. Why a meeting was required is unclear. After all, the appellant had complied with all the statutory requirements and was plainly entitled to a licence. In any event, no meeting appears to have taken place because the appellant's solicitors replied saying that the appellant's representative was not available on the date of the proposed meeting. Then on April 12, 1994 the appellant sent a reminder asking for the licence to be issued. The rest was silence.

3. Then, as usual, the appellant applied for the licence for 1993. On this occasion its application was refused. The reason given was that the area surrounding the factory had become a residential area and it was unsuitable for the appellant to carry on operations there. It is significant that no complaint was made that the appellant had operated their factory without a licence for the year 1994. The appellant was dissatisfied and appealed to the appeal board created by the EQA. However, its appeal was purportedly refused by the first respondent. This was plainly illegal. For, the EQA had vested the appellate power in the appeal board: not in the First respondent. The appellant accordingly moved the High Court for certiorari to quash the first respondent's decision. Its application failed. And for the oddest of reasons. The High Court accepted the submission of learned senior federal counsel that since the appellant had no licence for the year 1994 they had carried on their factory illegally and had no legitimate expectation to have a licence for 1995. This, in my judgment, is not correct.

4. In the first place, it was the wrongful conduct of the first respondent that led to the appellant having had no licence for 1994. He (the first respondent) had in so many words told the appellant that the licence for 1994 was not forthcoming unless the condition of land use was altered. That objection was of no consequence in the light of KC Vohrah J's ruling in OM No 32-33-1987 (referred to earlier). So the appellant was legitimately entitled to have the licence issued to it.

5. Of course, Parliament has conferred upon the first respondent the power or, to use a more well worn expression, the discretion to decide whether to issue the licence or not. But the law requires him to exercise this power or discretion fairly, justly and without misdirecting himself on the law or the facts. As Salleh Abas said in Savrimuthu v PP [1987] 2 MLJ 173:

   public interest, reason and sense of justice demand that any statutory power must be exercised reasonably and with due consideration.

6. The same principle was laid down in slightly different language by Lord Denning MR in Laker Airways Ltd v Department of Trade [1977] QB 643. There are two passages in the judgment of the Master of the Rolls that merit reproduction. This is what he said in the first:

   The underlying principle is that the Crown cannot be estopped from exercising its powers, whether given in a statute or by common law, when it is doing so in the proper exercise of its duty to act for the public good, even though this may work some injustice or unfairness to a private individual: see Maritime Electric Co Ltd v General Dairies Ltd [ 1937J AC. 610 where the Privy Council, unfortunately, I think, reversed the Supreme Court of Canada [1935] SCR 519. It can, however, be estopped when it is not properly exercising its powers, but is misusing them: and it does misuse them if it exercises them in circumstances which work injustice or unfairness to the individual without any countervailing benefit for the public: see Robertson v Minister of Pensions [1949] 1 KB 227; Re Liverpool Taxi Owners' Association [1972] 2 QB 299: HTV Ltd v Price Commission [1976] ICR 170.

7. And this is what he said in the second:

   The two outstanding cases are Padfield v Minister of Agriculture, Fisheries and Food [1968] AC 997, and Secretary of State for Education and Science v Metropolitan Borough of Tameside [1976] 3 All ER 769, where the House of Lords have shown that when discretionary powers are entrusted to the executive by statute, the courts can examine the exercise of those powers, so as to see that they are used properly, and not improperly or mistakenly. By mistakenly, I mean under the influence of a misdirection in fact or in law.

8. The judgment of Lord Denning MR in Laker Airways Ltd v Department of Trade [1977] QB 643 has been referred to and applied by our Federal Court. See, Malayan Banking Bhd v Association of Bank Officers, Peninsular Malaysia [1988] 3 MLJ 204; Menteri Sumber Manusia v Association of Bank Officers, Peninsular Malaysia [1999] 2 MLJ 337.

9. Now apply these pronouncements to the present facts. Here we have a case where any reasonable man in the appellant's shoes would have been led by the words and conduct of the first respondent to believe that the 1994 licence would be issued once the problem about the condition in the title to the land had been resolved. As for words, you only have to look at the letter he wrote. As for conduct, he accepted the payment made by the appellant and also did not respond at all to the appellant's reminder. Then at the hearing comes the suggestion that the appellant was not entitled to relief because it carried out its operations in 1994 without a licence. Now put that altogether and put it in any appropriate terms. You may say that the first respondent is estopped from refusing the 1994 licence. Or you may say that it is a case where the appellant was put in a position where it had a legitimate expectation that the 1994 licence would be issued. It does not matter. What in reality you have is a smacking of unfairness and injustice in administration.

10. Learned senior federal counsel suggested in her argument that the appellant had not acted reasonably because it had only sent one reminder to the first respondent. Now, how many reminders is a member of the public supposed to send to a government department before its staff will act? Quite frankly, I am unable to find an answer to that question.

11. In my judgment, each and every member of the public has a legitimate expectation to have his or her written communication to a government department looked into and dealt with in a timeous, courteous and efficient manner. It may be an application for a licence. It may be a letter of query. Or it may be a letter of complaint. Whatever the nature of the communication, there must be a response within a reasonable time. Otherwise it will be a case of poor administration. And the law does not sanction poor administration. Indeed, in Padfield v Minister of Agriculture, Fisheries and Food [1968] AC 997, the House of Lords approved Lord Denning's dissent in the Court of Appeal in that case where he said:

    Good administration requires that complaints should be investigated and that grievances should be remedied.

12. I recall at one point of time when Tun Abdul Razak our second Prime Minister introduced a system whereby every letter received by a government department was responded to promptly by an acknowledgment card which carried a file number with the pre-printed remarks that the matter was receiving attention. This enabled the writer to have a file reference with which to follow up with his inquiry or complaint. I cite this merely as an example of good administration in practice. One should not lose sight of the fact that for these many years the motto of the civil service administration has been "Bersih, Cekap dan Amanah" (Clean, Efficient and Trustworthy). In my judgment, it is the duty of the judicial arm of government, the courts, to ensure good administration by the due observance of this motto on a case by case basis. Otherwise members of the public who are adversely affected by a breach of the spirit and intendment of the motto in question will be left without resort to administrative justice.

13. That brings me to this case. The first respondent, as I have said, had no jurisdiction whatsoever to deal with the appellant's appeal. His act was ultra vires the EQA. We therefore allowed the appeal with costs here and below and remitted the appeal to the Appeal Board appointed under s 36 of the EQA to hear and dispose of the appeal in accordance with law. The orders of the High Court were set aside. The deposit was ordered to be refunded to the appellant.

14. My learned brother Mohd Ghazali Mohd Yusoff JCA had seen this judgment in draft and has expressed his agreement with it.

    Abdul Aziz Mohamad, JCA

15. The problems faced by the appellant company and the events surrounding them are broadly outlined in the grounds of judgment of my learned brother Gopal Sri Ram JCA. The problems concerned licensing in respect of the appellants' rubber factory. By virtue of an order of the Minister under s 18(1) of the Environmental Quality Act 1974, the occupation or use of the factory required a licence.

16. In the High Court the appellants sought orders to quash a decision that the first respondent made on January 15, 1995 and a decision of February 25, 1995, said in the appellants' notice of motion to have been made by the second respondent board. The decision of January 15, 1995 was a decision to refuse to renew the licence for the period April 1, 1995 to March 31, 1996. The decision of February 25, 1995 was actually a decision of the first respondent himself on the appellants' appeal to the second respondents against the decision of January 15, 1995. The decision of February 25, 1995 was that the appeal could not be considered because there had been complaints of offensive smell emanating from the appellants' factory and because the discharge of effluent from the factory had often failed to comply with the conditions of the licence. The appellants also sought by their notice of motion an order either to compel the first respondent to consider the renewal application (which he had done) or to compel the second respondents to hear the appellants' appeal.

17. At the close of his oral submission in the appeal before us, which arose from the High Court's dismissal of the appellants' notice of motion, the appellants' counsel said that basically the appellants' grievance was over the summary rejection by the first respondent of their appeal to the Appeal Board. It may be mentioned that the appellants' right of appeal is given by s 35(1)(a) of the Act and the appeal is to the Appeal Board constituted under s 36. The appellants' notice of appeal had been addressed to the second respondent, described as "Badan Rayuan Jabatan Alam Sekitar, Negeri Kedah and Perils", as to which the judge said that there was no body that was known by that name, but no question arose before us that was not the Appeal Board mentioned in s 36.

18. In view of what the appellants' counsel said, the only issue that I saw that we had to decide was whether the decision of the first respondent that the appeal could not be considered was lawful. If it was not, the decision had to be quashed and an order had to be made to enable the appellants to pursue their appeal. The decision was obviously unlawful. The appellants' appeal being a matter within the jurisdiction of the appeal board, it was not for the first respondent to decide that the appeal could not be considered. It was for the appeal board to decide the fate of the appeal.

19. We accordingly quashed the decision of February 25, 1995 and remitted the matter to the appeal board to consider and decide the appellants' appeal according to the law. In the event, other matters that had been submitted on in the appeal before us, which turned on the question whether it is correct that, as the learned judge held, the appellants had no legitimate expectation to a renewal of licence because the appellants had not been issued a licence for the previous period of April 1, 1994 to March 1995 and therefore there was no licence to renew and also because in that period they had been operating illegally since they had no licence, and which included the question of who was at fault in the appellants' not being able to obtain a licence for that period, were not matters that we needed to decide; and as they are matters that may be relevant to the appeal to the appeal board and that the appeal board may have to consider, I refrain from expressing any views about them.

Cases

Laker Airways Ltd v Department of Trade [1977] QB 643, CA; Malayan Banking Bhd v Association of Bank Officers, Peninsular Malaysia [1988] 3 MLJ 204, SC; Menteri Sumber Manusia v Association of Bank Officers, Peninsular Malaysia [1999] 2 AMR 1837; [1999] 2 MLJ 337, FC; Padfield v Minister of Agriculture, Fisheries and Food [1968] AC 997, HL; Savrimuthu v PP [1987] 2 MLJ 173, SC

Environmental Quality Act 1974: s.18, s.35, s.36

Representations

Ghazi Ishak and B Jayasingam (Ghazi & Lim) for appellant

Suzana Atan, DPP (AG's Chambers) for respondents

Notes:-

This decision is also reported at [2005] 2 AMR 471.