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Attorney-General v Members of Parliament (Entitlements) Commission [2009] SBHC 55; HCSI-CC 304 of 2009 (22 October 2009)

HIGH COURT OF SOLOMON ISLANDS
(Palmer CJ.)

Civil Case Number 304 of 2009

The Attorney-General (Representing the Solomon Islands Government)
The Claimant

V

Members of Parliament (Entitlements) Commission
The Defendant

Date of Hearing: 19-20 October 2009
Date of Judgement: 22 October 2009

Steven Woods on behalf of the Attorney-General
Billy Titiulu for the Defendant

Palmer CJ.:

1. The Members of Parliament (Entitlements)(Amendment) Regulations 2009 ("the Regulations") were published in the Gazette as Legal Notice No. 45 of 2009 on 6 July 2009 and made to come into force with retrospective effect on 1st April 2009.

2. These Regulations have attracted so much flak and publicity in the media recently, though that is of no concern to me in determining the issues that have been raised before me as a Category C proceeding under Rule 2.14(c) of the Solomon Islands Courts (Civil Procedure) Rules 2007 ("the Rules"), for a quashing order under Rule 15.3.4 of the Rules.

3. This Court has jurisdiction to deal with this application under section 77(1) of the Constitution which provides in very clear and plain terms that this court has unlimited original jurisdiction to hear and determine any civil or criminal proceedings under any law. No issue has been raised that this court lacks jurisdiction to deal with this case.

4. The Attorney-General on behalf of the Government seeks orders from the court to invalidate the Regulations in their entirety. Their case can be summarised as follows:

(i) That the Members of Parliament (Entitlements) Commission ("the Commission") did not follow the correct procedures in determining the provisions contained in the Parliamentary Entitlements Regulations 2009 as provided under sections 69, 69A, 69B and 69C of the Constitution.

(ii) That the Commission acted ultra vires its constitutional powers by providing for entitlements, including but not limited to a terminal grant to spouses contrary to the express provisions that such entitlements were for the purpose of enabling Members of Parliament to discharge their functions as Parliamentarians.

(iii) That the power to enforce regulation retrospectively is confined only to the requirements of section 69B(3)(b) which provide that the salaries and entitlements of Parliamentarians may increase at no less rate than the rates of increase in any of the salaries and entitlements (taken as a whole) of the public officers and that it failed to take that fact into account.

5. The Commission is a body set up by the Constitution under section 69A, consisting of a Chairman and four members. The Chairman and two of the members (referred to as the appointed members) are chosen by the Prime Minister and on his advice appointed by the Governor-General. The other members consist of the persons for the time being holding the offices of the Minister of Finance and the Chairman of the Public Accounts Committee.

6. The composition of the Commission in this particular instant is not in issue, that is, that it comprised only three members, a Chairman and two other members.

7. Subsection 69B(1) of the Constitution describes the power of the Commission, to determine the entitlements of Parliamentarians and to review them annually. The term "entitlements" is defined in section 69C(2)(a) as including salaries, allowances and such other benefits, services or facilities, whether in cash or otherwise as may be considered necessary to be provided to Parliamentarians to enable them to maintain the dignity of their office. The term "Parliamentarian" is defined in section 69C(2)(b) to include all Members of Parliament. It is trite to say that the spouse of a Parliamentarian is not included in the definition and that any entitlements made are for Parliamentarians.

8. Subsection 69B(2) sets out how the Commission is to exercise its powers. In determining the entitlements of Parliamentarians, it is obliged:

(a) to consider such representations from relevant persons or body of persons, that they have given notice to;

(b) to have regard to such information which may have been supplied to them by the Government, Parliament or any other organisation in relation to:

(i) the state of the national economy and the financial position of the Government, (the presence of the Minister of Finance in the Commission would ensure that this is done);

(ii) movements in the level of pay and entitlements to other persons in employment; and

(iii) changes in the retail price index and other relevant indicators showing the cost of maintaining the standard of living that Parliamentarians are reasonably expected to enjoy.

9. Subsection 69B(3) provides inter alia that in making or amending the regulations the Commission was to consider in relation to Parliamentarians and their families, such matters as accommodation during sittings of Parliament, housing, medical treatment, internal transport, external transport, travelling imprest, death and retirement benefits, appointment and terminal grants, advances and loans, additional payment for service in committees of Parliament, insurance and such other matter as may facilitate the discharge of their functions as Parliamentarians. Note there is a big difference between, taking into account the family needs of Parliamentarians when making the awards of Parliamentarians as opposed to making an award in favour of the spouse of a Parliamentarian.

10. Subsection 69B(4) prescribes the date when such entitlements are to come into effect. I will say more on this later as this is one of the crucial grounds now raised in this conference hearing under Rule 15.3.16 of the Rules.

11. Rule 15.3.16 imposes a mandatory requirement for a conference to be convened after defence has been filed and served. At the conference hearing the court is required to determine a number of things. These include the following matters:

- if there is an arguable case,

- if the claimant is directly affected by the issues in the claim,

- if there is undue delay in making the claim, and

- whether there is no other remedy that resolves the matter fully or directly.

12. The court has power to either dismiss the claim if it is not satisfied about the matters specified in rule 15.3.18 or may determine the claim, or give directions and fix a date for trial.

13. Such conference hearing was fixed for 19 October 2009 at 9.30 am. At the hearing, Mr. Woods on behalf of the Attorney-General submitted that the court should consider exercising its powers to determine the proceedings on two principal grounds. First, on the issue of retrospectivity and secondly, on the issue of the award of a terminal grant in favour of a spouse of a Member of Parliament. He submits that the two grounds are unanswerable as to the plain meaning of the Constitutional provisions which apply to them and if the court accepts his submissions then the matter can be determined here and then without the need for a hearing.

The award of the terminal grant in favour of a spouse.

14. I will deal first with the question of the award of the terminal grant in favour of the spouse of a Member of Parliament. The clause reads:

"The spouse of a Member of Parliament is entitled to a terminal grant as specified in item 9 of Appendix A, subject to all the conditions specified in subregulation 1, 2, 3 and 4."

15. The amount of the grant specified is $50,000.00 and made tax free. At the end of the life of Parliament therefore, the spouse of a Member of Parliament would have been entitled to receive such award.

16. Mr. Woods submits that nowhere in the Constitution was it envisaged that a spouse should be given a separate award under the Regulations. He says the Commission committed an error of interpretation culminating in an error of law when it made the award in favour of a member of the family of Parliamentarians. He says in purporting to exercise its power, the Commission misunderstood that while it has power to consider the family of Parliamentarians in determining the entitlement of Parliamentarians, have made a significant jump that they have a power to make awards directly to the family, whether it be the wife or children or others. He says this misunderstanding renders the award unlawful.

17. Mr. Titiulu for the Commission submits if I understand his argument correctly, that the power to include an award for spouses is embedded in paragraph 69B(3)(a) of the Constitution. He says that provision recognises the role of spouses in facilitating Parliamentarians in the discharge of their duties. He then goes on to submit that the question whether or not spouse’s entitlements of $50,000.00 is an entitlement that will facilitate Parliamentarians in the discharge of their functions as Parliamentarians is one of fact. He says the court will need to have evidence before it to determine that question and so the matter should proceed on to directions and trial.

Section 69B(3)(a) of the Constitution.

18. Section 69B(3)(a) provides that in making or amending the regulations, the Commission shall consider in relation to Parliamentarians and their families matters including, accommodation during sittings of Parliament, housing, medical treatment, internal transport, external transport, travelling imprest, death and retirement benefits, appointment and terminal grants, advances and loans, additional payment for service in committees of Parliament, insurance and such other matter as may facilitate the discharge of their functions as Parliamentarians.

19. The flaw in Mr. Titiulu’s argument in relying on the provisions of section 69B(3)(a) as authorising the Commission to make a separate award for spouses, is in misconstruing the phrase "and their families" as empowering the Commission to make such an award. If that was the construction to be adopted, it could open the floodgates to include children, grandparents and anyone else coming within that expression. In the Solomon Islands context, the list can be long. The absurdity of the result alone makes such construction untenable.

20. On the other hand, the phrase "and their families" recognises the realities of life, that a Parliamentarian, unless single, more likely than not, will have a family to support and who are dependent on him and vice versa. To say that a Parliamentarian’s family cannot be taken into account when making awards of Parliamentarians would be to deny the realities and demands of one’s obligations and responsibilities. In almost all instances, whatever entitlements a Parliamentarian receives, will directly or indirectly benefit his family as well. The provision of such things as housing, transport, utilities such as gas, electricity and water, telephones, domestic servants, gardeners, educational grants and so on are examples of benefits which take into account a Parliamentarian’s family and which ultimately facilitate the discharge of their functions more efficiently and effectively and help them to maintain the dignity of their office.

21. The distinguishing factor in all these however is that those entitlements must be linked to Parliamentarians for they are necessarily tied to their position or status. The entitlements/award follow the Parliamentarian. It has nothing to do with the spouse bar the requirement that the Commission must take into account the family needs and circumstances of Parliamentarians when considering what entitlements should be given to Parliamentarians. That however is wholly different from making a separate award for the spouse of a Parliamentarian. To do so offends against the letter and the spirit of the Constitutional provisions governing the powers of the Commission.

22. The submission therefore by Mr. Titiulu that section 69B(3)(a) empowers the Commission to make an award for a terminal grant to spouses must be rejected. This is strictly a question of law and not of fact. The question of fact whether the award was justifiable and whether it would facilitate the discharge of the functions of Parliamentarians only arises if the argument in limine that the Commission had jurisdiction to make such an award was answered in the affirmative. In this instance, I agree with the submission of Mr. Woods that the award as worded is "obnoxious" to the expressive terms of the Constitutional provisions and therefore ultra vires their powers. The award to that extent should be expunged from the Regulations.

Retrospectivity of the Regulations - Section 69B(4)(a) of the Constitution

23. This brings me to the second threshold argument raised by Mr. Woods that by back dating the effective date of the Regulations, the Commission committed an error of law that cuts to the heart of the decision making process and rendered the entirety of the Regulations unlawful.

24. The Regulations were dated as of 6th July 2009 but made to commence with retrospective effect from 1st April 2009.

25. Section 69B(4)(a) provides that:

"(4) Every regulation made or amended under this section –

(a) shall come into force on 1st April –

(i) of the year in which it is made, if it is made on that day; or

(ii) of the year next following the date on which it is made, if it is made on any other date:

Provided that the Members of Parliament (Entitlements) Commission may, in order to comply with the requirement of subsection (3)(b) of this section, enforce any such regulation from such other date prospectively or retrospectively, as they may specify in that regulation; and

(b) shall, during the period such regulation is in force, have effect as if it were a provision of this Constitution."

26. It is not disputed by Mr. Titiulu in his submissions, that if the regulations were made on the 1st April 2009, that the effective date for commencement of the Regulations would be that date. Where they were made on any other date, as is the case here, the effective date ought to have been 1st April 2010. The rationale for this is to ensure that entitlements of Parliamentarians are reviewed not more than once in a year save for purposes of keeping up with any rates of increases in the salaries and entitlements (as a whole) that may be awarded to Public Officers. This is the only exception provided in section 69B(4)(a)(ii) for making the dates to commence prospectively or retrospectively.

27. In his submissions before this court Mr. Woods says there is no material in relation to the requirements of section 69B(3)(b), which show that the Regulations were made to commence with retrospective effect, to keep up with the rate of increases of the salaries and entitlements (taken as a whole) of Public Officers. He says despite repeated requests and orders of the court as far back as 14 September 2009, requiring the Commission to disclose documents relied on when making the Regulations, nothing has been produced which support the decision for retrospectivity. The crucial piece of evidence which would have justified such decision would have been for the Commission to produce documents which showed there was a major movement upwards in the salaries and entitlements (as a whole) of Public Officers in the preceding year, 2008 and first quarter of 2009.

28. Mr. Titiulu when asked on this point could only inform the court that he had no instructions on the matter. Mr. Titiulu told the court he could not indicate one way or the other, whether the Commission took into account any increases of salaries and entitlements of Public Officers. The point was then made to Mr. Titiulu that it was incumbent on his client to furnish him with the necessary instructions, a fortiori when it had been ordered by the court for particulars to be provided by 4.00 pm, 2nd October 2009. But even if that were not the case he should have been able over the adjournment in the minimum to have obtained instructions on the issue of retrospectivity. It is incumbent upon him to demonstrate at this conference hearing that there is an arguable defence to the threshold argument of law raised and which necessitates further directions and the matter going to trial. It was pointed out to Mr. Titiulu that the reason why no instructions were given could have been the fact that no such consultation or consideration ever occurred and that the decision to have the Regulations back dated was made in error; it could have been made in ignorance of that Constitutional provision.

29. While I agree with Mr. Titiulu that the question whether the Commission made the Regulations to commence retrospectively is a question of fact, it is simply not sufficient for him at this conference hearing to say so without more. By failing to produce or point to anything factual that would support his argument, it all amounts to mere assertions and insufficient to satisfy the test of a viable defence.

30. In the circumstances I am satisfied the Commission has acted beyond its powers in making the Regulations to commence with retrospective effect. Mr. Woods submits this defect is so fundamental that it cuts across the whole decision making process and rendering the entirety of the decision of the Commission unlawful. I agree. Even if the spousal terminal grants can be expunged, the rest of the Regulations cannot be made effective in the minimum until 1st April 2010. In view of the blatant errors committed in the decision making process, which would have been sufficient alone, but noting also the public furore over these Regulations, the only proper thing to do in the circumstances is to order that they be quashed with immediate effect. That does not stop the Commission from reconvening at some later stage to reconsider any or all of the entitlements as prescribed by law.

Orders of the Court:

1. Grant declaration that the Members of Parliament (Entitlements) Commission acted ultra vires in making an award to a spouse of a Member of Parliament of a terminal grant of $50,000.00;

2. Grant declaration that the Members of Parliament (Entitlements) Commission acted ultra vires in making the Members of Parliament (Entitlements)(Amendment) Regulations 2009 to commence on retrospective basis from 1st April 2009.

3. Grant quashing order for the decision of the Members of Parliament (Entitlements) Commission as encapsulated in the Members of Parliament (Entitlements)(Amendment) Regulations 2009 to be quashed forthwith.

4. The Claimant to have their costs in this action.

The Court.