Jersey Unreported Judgments

[2003]JRC226

royal court

(Samedi Division)

 

4^th December, 2003

 

 

 

 

 

Appeal under Rule 12/1 of the Royal Court Rules 1992, as amended, against the refusal of the Respondent Committee to grant permission for the commencement of a new fibreglass, moulded products, and roofing undertaking.

 

Advocate P. M. Livingstone for the Appellant

The Solicitor General for the Respondent Committee.

 

 

 

judgment

the bailiff:

Introduction

1.        This is an appeal against a refusal on 23rd April 2003 by the respondent committee (to which we shall refer as "the Committee"), acting through its official Wayne Gallichan ("Mr Gallichan") under delegated powers, to grant consent for the commencement of a new fibreglass, moulded products and roofing undertaking pursuant to article 5 of the Regulation of Undertakings and Development (Jersey) Law 1973 ("the 1973 Law").  The ground of appeal is that the Committee's decision was unreasonable having regard to its refusal to regard Mr Arthur Boyne ("Mr Boyne") as having been resident in the Island for the whole of the past five consecutive years.

2.        The ground of appeal requires some explanation.  The application leading to the decision under appeal was made on 21st November 2002.  The application form declared that the principals of the business were Mr Andrew John Longford ("Mr Longford") and Mr Boyne.  Both were described as having been resident in Jersey for the last five years.  It was also stated on the application form that the appellant would be engaging two full-time employees (apart from the principals) who had not been resident in the Island for the last five years.

3.        There was a rather convoluted background to the application which involved a Miss Gwen O'Hara and Mr Russell Ormerod who at one stage owned shares in the appellant, but none of that is relevant to the issue raised by this appeal.  We should also record that the Committee treated the application, having regard to the convoluted background to which we have referred, as having been made by Mr Longford and Mr Boyne, and the form of refusal was issued to them and not to the appellant.  No issue is taken either by counsel for the appellant or by the Solicitor General on this point.  We accept that Mr Gallichan was endeavouring to be helpful to Messrs Longford and Boyne, but this type of procedural shortcut is rarely appropriate.

The decision

4.        In considering the application, Mr Gallichan, acting as we have stated under delegated powers, had regard to the policy statement issued in January 2000 by the Industries Committee, the predecessor of the respondent committee, as modified by a policy statement issued in March 2003 by the Committee.

5.        In his affidavit, Mr Gallichan described his approach to the application in this way -

10.2    ....  The overriding consideration to which I had regard was the policy statement of the then Industries Committee dated January 2000.  Part of that policy is that applications for the commencement of a new undertaking by a mix of locally qualified/non-locally qualified principals ("qualified" being defined as ordinarily resident in the Island for the whole of the preceding five years) should be refused under delegated powers unless "special circumstances" apply.  That policy is also applied to the engagement of non-locally qualified staff.

10.3    "Special circumstances" are deemed as applying if, "having regard to the need to regulate and manage the demand on the resources of the Island, there is evidence that sufficient benefits could be derived for a licence to be in the Island's overall best interests."

10.4    That policy statement was superseded by that of the now Economic Development Committee which took effect from March 2003.  The relevant considerations to which I had regard in the new policy were, inter alia, that, in considering an application for a new undertaking, "regard should be had to the locally qualified status of the principals."  That policy has somewhat relaxed the previous policy inasmuch as applications for licences by principals who are non-locally qualified but who will not be working actively in the Island will normally be granted providing the staff to be engaged are locally qualified.  In the present case, the principals (Messrs Boyne and Longford) sought to be "working principals" and were, therefore, required to both be locally qualified in order to conform with the policy.  Furthermore, they also sought to engage two non-locally qualified staff.

10.5    Having satisfied myself that Mr Longford was locally qualified, I gave consideration to the residential status of Mr Boyne.  In doing so I had regard to the following further documents:

a)        Regulation of Undertakings and Development (Jersey) Law 1973 (as amended)

b)        Regulation of Undertakings and Development (Jersey) Regulations 1978

c)        Printout from the Department of Social Security detailing Mr Boyne's annual contributions dated 20th April 2001

d)        Letter from Precision Plastics (Mr Boyne's former employer) "to whom it may concern" dated 10th May 2001

e)        File note of telephone conversation between James Griffiths (RUD Officer) and Mr Powell of Precision Plastics dated 10th May 2001

f)         Letter from Advocate Livingstone to the RUD Office dated 21st November 2002

g)        "Record of Interview" conducted by Val Aitken (RUD Enforcement Oflficer) with Mr Boyne dated 6th February 2003

h)        Letter from Mark Peters (former landlord of Messrs Boyne and Longford) to Advocate Livingstone dated 26th March 2003

i)         Letter from Employment & Social Security to Mr Boyne detailing his contribution record dated 27th March 2003

j)         Letter from Dr G Hamilton (Mr Boyne's GP) "to whom it may concern" dated 27th March 2003

10.6    As Mr Boyne had, during the preceding five years, spent numerous extended periods of time (sometimes up to six months) away from the Island without having retained an address in Jersey, I was unable to satisfy myself that Mr Boyne had been continuously resident in the Island.

6.        Mr Gallichan, having had regard to "the need to regulate and manage demand on the resources of the Island" as required by article 5 of the 1973 Law, decided that insufficient benefit would be derived from the proposed undertaking to justify granting consent as one of the principals and the proposed employees were not locally qualified in the sense of having been resident for the last five years.

7.        That finding as to "insufficient benefit" is not challenged by Mr Livingstone for the appellant.  The only point taken is that Mr Boyne should have been found to be locally qualified.

8.        The information available from the Department of Employment and Social Security showed that Mr Boyne had made social security contributions for the number of weeks set out in the table below -

1995         44 weeks

1996         48 weeks

1997         43 weeks

1998         40 weeks

1999         35 weeks

2000         35 weeks

2001         26 weeks

2002         26 weeks

9.        It was not seriously contended by counsel for the appellant that Mr Boyne had not been absent from the Island for substantial periods during 2001 and 2002, and indeed during 1999 and 2000.  Mr Boyne himself told a representative of the Committee during a recorded interview that "I have gone on holidays for three to six months for five or six years travelling the world".

10.      That is the essentially undisputed factual background to the decision. 

The appellant's contentions

11.      Mr Livingstone drew attention to the Committee's policy statement as to the exercise of its functions under the 1973 Law which was revised in December 2002.  The statement provides at paragraph 5 that the Committee will have regard to a number of objectives including the need - "to ensure the full employment of the resident population  ....".  The Committee's statement emphasized that it was seeking to achieve business growth "without the employment or population growth that has occurred in the past".  (See para 6).  At para 7 the Committee defined locally qualified persons as that term is used in the 1973 Law as including "(ii) persons resident for the whole of the past consecutive five years".

12.      Counsel submitted that Mr Boyne was to be regarded as "resident" in Jersey since 1995 in that he had been physically present in the Island for the majority of each succeeding year and had no other home.  His absences were accountable to extended holidays that he had taken during this period.  Counsel submitted that it was unnecessary to spend each day of the year in Jersey in order to be regarded as "resident for the whole of the past consecutive five years".

13.      Counsel's submissions were also directed to the question whether Mr Boyne was "ordinarily resident" during the five years preceding his application.  It is unfortunate that the Committee has employed terminology that has led to some confusion as to whether the issue relates to "residence" or "ordinary residence".  At para 10.2 of Mr Gallichan's affidavit set out above he refers to "qualified" being defined as "ordinarily resident in the Island for the whole of the preceding five years".  At para 10.6 however Mr Gallichan records his conclusion that he was "unable to satisfy [himself] that Mr Boyne had been continuously resident in the Island".  The formal notice of refusal sent to the appellant however contains a note stating that "a person is locally qualified  ..... if .... he/she ..... was ordinarily resident in the Island during the whole of the period of five years immediately preceding the start of the engagement".

14.      That reference to "ordinary residence" is also contained in the notes to the standard form of application which was completed by the appellant.  Para 5(b) of the notes states -

"Resident for last 5 years" means "ordinarily resident in the Island for the whole of the preceding five years prior to engagement".

15.      Counsel for the appellant submitted that Mr Boyne was both "resident" and "ordinarily resident" in Jersey during the five years preceding the date of application under the 1973 Law.

The relevant statutory provisions

16.      Article 2 of the 1973 Law provides that -

"(1)     Subject to the provisions of this Law, no person shall -

(a)       commence a new undertaking;

(b)       increase the number of persons engaged in an undertaking, unless he has been granted a licence so to do.

.........

(3)       The States Regulation may by Regulations provide for exemptions from any of the provisions of this Part of this Law".

17.      Regulation 1A of the Regulation of Undertakings and Development (Jersey) Regulations, 1978 ("the 1978 Regulations") provides that -

(1)       The engagement of a locally qualified person in a position in an undertaking shall be exempt from the provisions of sub-paragraph (b) of paragraph (1) of Article 2 of the principal Law -

(a)       if at any time during the six months prior to the engagement of the person in the position a person had been engaged in that position; or

.........

(2)       For the purpose of paragraph (1) of this Regulation a person is locally qualified for engagement in a position in an undertaking -

(a)       if, at all times during the term of that engagement, consent to a transaction to which Part III of the Housing (Jersey) Law 1949 applies would be granted by the Housing Committee by virtue of a sub-paragraph of paragraph (1) (other than sub-paragraph (l) or (m)) of Regulation 1 of the Housing (General Provisions) (Jersey) Regulations 1970, as amended, were the person to be an intending purchaser, transferee or lessee; or

(b)       if during the whole of the period of five years immediately preceding the start of the engagement the person was ordinarily resident in the Island; or

18.      It is to be noted that the provisions of the 1978 Regulations all relate to the increase of the number of employees engaged in an undertaking.  There are no relevant provisions relating to the commencement of an undertaking.

The test

19.      The Solicitor General reminded us that in Safeguard Business Systems (Channel Islands) Limited v Finance and Economics Committee (1980) JJ 169 it was held that, on an appeal under the 1973 Law, the Court must ask itself -

(i)        were the proceedings of the Committee in relation to the application, the rejection of which gives rise to the appeal, in general sufficient and satisfactory?

(ii)       was the decision one which the Law empowered the Committee to make?  and

 (iii)     was the decision reached by the Committee one to which it could reasonably have come having regard to all the circumstances of the case?

20.      That conclusion was reached on an application of the test established in Le Masurier v Natural Beauties Committee (1958) 13 CR 137; 1951-58 TD 25,182 Unreported, in relation to planning appeals.  That test has now however been restated, following observations of the Court of Appeal, in Token Limited v Planning and Environment Committee (2001) JLR 698.  The Solicitor General submitted that the Court should take account of these judicial developments and restate the test to be applied by the Court in appeals under the 1973 Law.  We agree, and would re-formulate the approach that the Court should take as follows.

21.      In exercising its appellate jurisdiction under the Regulations of Undertakings and Development (Jersey) Law 1973 the Court must determine whether the Committee's decision was unreasonable having regard to all the circumstances of the case.  In making that determination the Court must consider not merely whether the Committee has followed the correct procedure, but also whether its own view is that the decision was unreasonable.  It may allow whatever weight it thinks proper to the experience and knowledge of the Committee, but it cannot escape the responsibility of forming its own view.  This does not however entitle the Court to find that the Committee's decision was reasonable but to quash it because the Court has reached an equally reasonable but different conclusion.  The Court might think that a Committee's decision is mistaken, but that does not itself entitle the Court to substitute its own decision.  The Court must form its own view of the merits, but it must reach the conclusion that the Committee's decision is not only mistaken but also unreasonable before it can intervene.  There is an element of semantics here but there is, nonetheless, a qualitative difference between finding that a decision is unreasonable, rather than simply mistaken.  To put it another way, there is a margin of discretion before a decision which the Court thinks to be mistaken becomes so wrong that it is, in the view of the Court, unreasonable.

Conclusion

22.      Before applying that test to this decision of the Committee, it is necessary to revert to the question that Mr Gallichan had to ask himself.  In our judgment, where an application is made under the 1973 Law for a licence to commence a new undertaking, it is not material to enquire whether a person has been ordinarily resident in the Island for the past five years.  The 1978 Regulations contain no exemptions from article 2(1)(a) of the 1973 Law. What is relevant is not the provisions of the 1978 Regulations but the terms of the policy statement issued by the Committee and revised with effect from December 2002.  The question is and was whether Mr Boyne had been "resident for the whole of the past consecutive five years".

23.      Both the Solicitor General and counsel for the appellant referred us to a judgment of Coutanche, Bailiff in Attorney General v Knight (1954) JJ 79.  The issue in that case turned upon the meaning of the phrase "ordinarily resident" in the Housing (Jersey) Law 1949.  Nonetheless the Solicitor General cited the following passage from the judgment at page 83 -

"The Attorney drew our attention to a statement of the law which is derived from the old case of Blackwell v England, which was decided in the year 1857, and which is reported in Ellis & Blackburn's Queen's Bench cases.... This Court, amongst other statements of law, adopts that statement of an important principle to guide us in this matter.  The principle is that the meaning of the word 'residence' in a statute depends upon the purpose of the enactment."

24.      At page 84 Coutanche, Bailiff, continued -

"In our judgment, the word 'residence' has nothing whatsoever to do with tenure.  It does not have anything to do with the question of whether a person has a proprietary or a tenancy right in property.  The word 'resident' means being physically present in a given place at a given time".

25.      We are of course interpreting a policy statement rather than a statute but the principle nevertheless holds good.  What was the purpose of the Committee in expressing itself in the policy statement in the way that it did?  It seems to us that what is required is evidence that the person in question has been living continuously in the Island for the period of five years.  That seems to us implicit from the words, "the whole of" which precede the words "the past consecutive five years".  That does not mean that a person is not able to take holidays without prejudicing his claim to have been living continuously in the Island.   But where a holiday endures for a period of several months it becomes more difficult to sustain the argument that the individual has been living continuously in the Island.  In any event this is a question of fact for the decision-maker, who was in this case Mr Gallichan.  Mr Gallichan reached the conclusion that Mr Boyne had not been continuously resident in the Island.

26.      Counsel for the appellant took no issue with the procedure followed by Mr Gallichan.  On balance we think that he did ask himself the right question, namely whether Mr Boyne had been resident for the whole of the past consecutive five years.  As to the decision at which he arrived it seems to us that it cannot be said that it was in all the circumstances in any way unreasonable.  The appeal is accordingly dismissed.

Authorities.

Regulation of Undertakings and Development (Jersey) Law 1973.

Token Limited v Planning and Environment Committee (2001) JLR 698

Attorney General v Knight (1954) JJ 79.

Regulation of Undertakings and Development (Jersey) Regulations, 1978.

Safeguard Business Systems (Channel Islands) Limited v Finance and Economics Committee (1980) JJ 169.

Le Masurier v Natural Beauties Committee (1958) 13 CR 137; 1951-58 TD 25,182 Unreported.

Hobden-v-Le Riches Stores [1996] JLR N2.

4 Halsbury 8(1): paras 703-5.

Levene-v-IRC [1928] AC 217.

IRC-v-Lysaght [1928] AC 234.

Stransky-v-Stransky [1954] 1 All ER 536.