Supreme Court dismisses challenge to potato seed import ban as necessary for public economic interest.

[*649] 1971 May 31

(A. LOIZOU, J.)

REVISIONAL JURISDICTION

In the matter of Article 146 of the Constitution

Andreas K. Psaras,

Applicant,

and

The Ministry of Commerce & Industry,

Respondent.

(Case No. 286/70).

Imports (Regulation) Law 1962 (Law

49 of 1962) (as amended by Law 7 of 1967) section 3 - Not unconstitutional so long as the restriction or regulation of the importation of goods is made, as in this case, in the public interest or for any other of the objects set out therein - In the instant case considering the benefits to the economy of the country as a whole it cannot be said that such powers, restricting and limiting the importation of potato seed, were not necessary in the public interest.

Imports (Regulation) Law 1962 (Law 49 of 1962) (as amended by Law 7 of 1967) - Restrictions for importation made thereunder not limited solely to importers -traders.

Constitutional Law - Article 25.1 of the Constitution - Refusal to grant import licence for importation of potato seed - Not unconstitutional - Restrictions placed on applicant held to be necessary in the public interest.

Administrative Law - Refusal to grant import licence for importation of potato seed - Made under section 3 of

the Imports (Regulation) Law 1962 (Law No.49 of 1962) (as amended by Law 7 of 1967) - Not contrary to such Law or to

any principle of administrative law - Issue of licence a matter within the discretion of Respondent Minister under section 4 of the Law - Relevant discretion properly exercised in the public interest.

Constitutionality of Legislation - Power of Supreme Court to exercise Judicial Supervision over the Constitutionality of Legislation.

Chr. Mitsides, for the Applicant.

K. Talarides, Senior Counsel of the Republic,for the Respondent.

JUDGMENT

The following judgment was delivered by:-

A. LOIZOU. J.: By the present application the applicant seeks to challenge the validity of the decision [*650] of the Minister of Commerce and

Industry, communicated by letter dated the 26th September, 1970, refusing to grant him a licence to import into Cyprus potato seed for the winter season, as being unconstitutional, ultra vires and illegal.

The application is based on the following grounds

of law:

1. “Section 25(1) of the Constitution does not impose any restrictions on the importation of Potato seed so long as it is certified that it is free from any phytopathological and is proper and fit for planting into Cyprus."

2. "That Law 59/64 does not and cannot impose any conditions on the importation of sound potato seed."

3. "That the said act or decision of the Respondents restrain and/or restrict unlawfully the free activities of the individual contrary to the constitution.”

The facts of the present case are as follows: The applicant and his family are potato growers from the village of Xylophagou, planting approximately 200 donums of potatoes every year. On the 16th September, 1970, the applicant addressed to the Director-General of the Ministry of Commerce and Industry, Nicosia, the following application, which is Exhibit 1. It reads as follows: [*651]

"16η Σεπτεμβρίου, 1970.

Γενικόν Διευθυντήν,

Υπουργείου Εμπορίου και Βιομηχανίας, Λευκωσίαν.

Έντιμε Κύριε,

Εξαιτούμαι άδειαν εισαγωγής πατατοσπόρου ποικιλίας Arran Banner και up-to-date ή οιασδήποτε

άλλης ποικιλίας την οποίαν εγκρίνει το Υπουργείον Γεωργίας δια την χειμερινήν

σαιζόν 70-71, η ποσότης η οποία χρειάζομαι είναι 200 τόνοι.

Ελπίζω να έχω την ευνοϊκήν

απάντησιν σας το συντομώτερον προς αποφυγήν περαιτέρω προστριβών.

Μετά τιμής, (Ύπ.) Ανδρέας Κ. Ψαράς."

By letter dated 26th September, 1970, photocopy of which is attached to the application the said Director replied as follows:

"ΥΠΟΥΡΓΕΙON ΕΜΠΟΡΙΟΥ ΚΑΙ ΒΙΟΜΗΧΑΝΙΑΣ, ΛΕΥΚΩΣΙΑ.

Αρ. Πρωτ. 229/νι

26η Σεπτεμβρίου, 1970.

Κύριε,

Ένετάλην όπως αναφερθώ εις την

επιστολήν σας υπό ημερομηνίαν 16ην Σεπτεμβρίου 1970, δι' ης αιτείσθε όπως σας

παραχωρηθή άδεια δι' εισαγωγήν 200 τόννων πατατοσπόρου και σας πληροφορήσω ότι

και εφέτος απεφασίσθη όπως η εισαχθησομένη ποσότης πατατοσπόρου περιορισθή και

όπως υιοθετηθή η ιδία, ως και κατά τα προηγούμενα έτη ακολουθηθείσα διαδικασία ότε παρεχωρήθησαν άδειαι βάσει των

πραγματοποιηθεισών εισαγωγών εκάστου εισαγωγέως κατά την τριετίαν 1965-66,

1966-67 και 1967-68. [*652]

Εν όψει των ανωτέρω, ως και του γεγονότος ότι συμφώνως προς

τα εις χείρας μας στοιχεία ουδεμία εισαγωγή πατατοσπόρου εγένετο υφ' υμών, κατά

τας ως άνω περιόδους, λυπούμαι να σας πληροφορήσω ότι το ημέτερον Υπουργείον

δεν δύναται να εκδώση εις υμάς οιανδήποτε άδειαν εισαγωγής πατατοσπόρου.

Μετά τιμής, δια Γενικόν Διευθυντήν.

Κον Ανδρέαν Ψαράν, Ξυλοφάγου, Λάρνακα."

By direction of the Court, three affidavits were filed on behalf of the applicant setting out the facts relied upon in support of his contentions. They emanate from three potato growers, co-villagers of the applicant.

Their effect within the context of the present case is that some farmers did import their potato seed in the past and the refusal of the respondent to issue an import licence to the applicant would mean a financial loss of £400 to £500.

The respondent in his notice of opposition states that the importation of potato seed was restricted for the second year running and regulated for the purposes mentioned in section 3(l) of the Imports (Regulation) Law, 1962, as amended by Law 7/67 and the Order made thereunder, Notification No. 327 published in Supplement No. 3 of the official [*653] Gazette of the 24th May, 1968. The refusal of an import licence to the applicant was made on the strength of the aforesaid Order, on the criteria set out in the said decision to wit that the quantity of potato seed to be imported was decided to be limited and that the same procedure was followed as in previous years when import licences were issued on the basis of the imports of each importer made during the preceding years, i.e. 1965-1966, 1966-1967, 1967-1968. It is also averred that the Ministry of Commerce and industry acted objectively in the public interest and for the purpose of restricting the quantity to be imported for the achievement of the. intended objective.

The argument of learned counsel for the applicant was twofold. That the Minister-respondent - whether he acted under the Cyprus Potato Marketing law 59/64, or the Imports (Regulation) Law 1962 as amended and the order made thereunder, (a) had no authority under either of the said laws to refuse an import licence to the applicant; and (b) that if either of the aforesaid two laws gives such authority, same is unconstitutional as being contrary to Article 25(1) of the Constitution because limitations may be imposed for importers but not for a potato grower who is not exercising a trade or business. Though learned counsel for the applicant at first argued against the constitutionality of the whole of the said laws, in the course of the addresses he confined his argument to section 3 of the Imports (Regulation) Law 1962 as amended. [*654]

I shall deal with the second point first: The Cyprus Potato Marketing Law of 1964 relied upon by the applicant in his present application, was neither invoked by the respondent for the rufusal of the licence, nor has any bearing in the present proceedings. In fact the applicant never applied to the Board set up under that law for any licence nor has the Director General of the Ministry of Commerce and Industry purported to have acted in this case in any other capacity but as a Director General acting for and on behalf and on the instructions of the Minister of Commerce and Industry. It is pertinent to quote here a passage from the judgment of Triantafyllides, J. (as he then was) in the case of Christodoulos Kyriakides (No.2) v. The Council for Registration of Architects and Civil Engineers, (1965) C.L.R Part III, p. 617 (approved on appeal on this point by the Pull Bench see(1966) 6 J.S.C. p.880) where at p.623 it is stated:

"The power of this Court to exercise judicial supervision over the constitutionality of legislation, is not the exercise of any substantive power to review and annul acts of the legislature, but it is only part of the discharge of judicial power vested in this Court for the purposes of these proceedings under Article 146 of the Constitution; it is a necessary concomitant of the power to hear and dispose of a case properly before the Court by bringing to bear upon its determination the test and measure of the law (vide Adkins v. Children’s Hospital and [*655] Lyons 261 U.S. 525; 67 Law Ed. 785). A corollary thereof is that constitutional questions should he decided only when necessary."

In the light of what has been stated hereinabove as to the relevancy of the Cyprus Potato Marketing Law 1964 to the sub-judice decision, I do not find that the determination of the constitutionality of this law or any part thereof is necessary for the purposes of these proceedings. Had it been necessary, however, to adjudicate upon it, I would have no hesitation in deciding that this law is not unconstitutional, as it comes within the ambit of para.3 of Article 25.

The next point for determination is (

a), the unconstitutionality or not of section (3) of the Imports (Regulation) Law 1962 and the order made thereunder, under which the decision complained

of was taken, and (b) the unconstitutionality or not of the said decision.

(a) Article 25 of the Constitution safeguards the right of the individual to practise any profession Or to carry on any occupation, trade or business. Paragraph 2 thereof provides that "the exercise of this right may be subject to such formalities, conditions or restrictions as are prescribed by law and are inter alia necessary only ... in the public interest". It regulates, therefore, the conditions under which a profession, trade or business may be exercised. The requirement of a licence for the importation of a particular type of goods does not amount to a prohibition [*656] to carry out a profession or occupation. One may still become an importer in respect of these goods or other goods subject to certain conditions which are necessary inter alia in the ''public interest”. I hold, therefore, that section 3 of Law 49/1962 as amended is constitutionally valid so long as the restriction or regulation of the importation of goods is made, as it is the case under consideration, in the public interest or for any other of the objects set out in the said section i.e. the encouragement of local production and manufacture, the improvement of the balance of trade, compliance with international obligations and the development of the economy of the Republic, all being objects that bring it within the ambit of para. 2 of Article 25, the very terms of which render it manifestly a provision of law necessary in the public interest.

The judgment of the Supreme Constitutional Court in the case of Hussein Irfan and Others v. The. Republic of Cyprus through The Minister of Commerce and Industry. 3 R.S.C.C. p. 39 has been of great assistance to me in deciding the issue raised in the present case. The issue raised in the aforesaid case was the unconstitutionality of the Defence (importation of Goods) Regulations 1959 - which is analogous to the law under review - and it was held that:-

"...the Regulations in question are not unconstitutional in so far as they enable the appropriate authorities to impose restrictions on imports which are necessary in the public interest, in the sense of paragraph 2 of Article 25 of the Constitution. [*657] it is to be observed that in deciding what is necessary in the sense of paragraph 2 of Article 25, regard must be had to the circumstances ’prevailing at the relevant time".

In this respect considering the benefits to the economy of the country as a whole one cannot say that such powers restricting and limiting the importation of potato seed were not necessary in the public interest. In any event nothing has been suggested to show that such restrictions were unnecessary.

(b) Regarding the second leg of the argument of learned counsel for the applicant, namely that the said decision is unconstitutional, as being contrary to Article 25(1) of the Constitution, as limitations might be imposed for importers but not for a potato grower who is not exercising a trade or profession other than that of a farmer, learned counsel for the respondent has argued that Article 25 applies to cases of restrictions regarding the person who will engage in a trade or business and it does not limit the power of the legislator to control the manner in which a trade will be carried out. He relied on the decision of a judge of this Court where this point was considered and decided upon with regard to an identical act or

decision by the Minister of Commerce and Industry. It is the case of Impalex Agencies Ltd. v. The Republic etc.. (1970) 12 J.S.C. p. 1236, where HadjiAnastassiou, J.. concluded that such decision was not repugnant to the provisions of [*658] Article 25 of the Constitution. With this conclusion I agree as it is equally applicable to the facts of the present case. To my mind, however, limitations on the importation of goods can in a proper case he considered as violating Article 25 of the Constitution and this is borne out by the decision in Hussein Irfan and Others v. The Republic (supra).

In the present case, however, there is nothing to suggest that more restrictions were placed on the applicant than were necessary in the public interest in violation of Article 25 of the Constitution, or that the provisions of the Imports (Regulation) Law 1962 were in any way disregarded. I am afraid I cannot agree with the distinction made by learned counsel for the applicant to the effect that the importation of potato seed by a farmer for his own needs gives a different context to this case than where the importation is made by a trading firm for the purposes of trading. Such distinction is not borne out by the definition of 'importer' given in the order made under section 3 of the law, (see Notification 327 in the Gazette No.654 of the 24th May, 1964) where it is stated that an ’importer means (a) every permanent resident of the Republic carrying on business in the Republic. The applicant comes within that definition which does not limit the restrictions applicable solely to importerstraders. In any event the applicant in his application of the 16th September, 1970, made no reference to his capacity as a farmer. He merely applies for an import licence and [*659] says "... the quantity which I need is 200 tons," from which one could not reasonably infer that he was a farmer.

Before concluding, I would like to deal with one more point, which covers also the first leg of the argument of the applicant. The applicant in his prayer for relief, claims, apart from the unconstitutionality issue, that the refusal of the respondent is "ultra vires and illegal". In para. 5 of the facts relied upon in support of the application it is stated: "Further, the said act or decision of the respondent is arbitrary and unreasonable and contrary to law".

I take the aggregate effect of the aforesaid contentions as raising the issue that the respondent acted contrary to law and in excess or abuse of power. And by "law" in this context it is meant not only the law in question but any principle of Administrative law that has been introduced into our jurisprudence by Article 146 of the Constitution. Section 3 of Law 49/1962 as amended by Law 7/1967, lays down that -

"Whenever it becomes necessary in the public interest to restrict and regulate the importation of goods for the encouragement of local production and manufacture, the improvement of the balance of trade, compliance with international obligations or the development of the economy of the Republic, the Minister may by Order published in the official Gazette of the Republic restrict and regulate the importation of the goods specified in the order". [*660]

Potato seed is one of the commodities the importation of which was thought necessary to be restricted and regulated as appearing in the First Schedule to the Order made under the said section. There was legal authority therefore to subject the importation of potato seed to the requirement of a licence. By refusing to grant one the respondent in the present case, for the reasons given in his decision, exercised his discretion in the public interest for the purpose for which this power was granted. There has been nothing to suggest that this was not so. The fact that by the exercise of such power the interests of the applicant and by inference the interests of a class of the population have, to a certain extent, been affected, is not sufficient to lead this Court to the conclusion that the respondent acted contrary to Law and in abuse or excess of power.

The issue or not of a licence is left to the discretion of the Minister as set out in section 4 of the Law 49/1962 and so long as the Minister exercises his discretion within the object of the law the exercise of same is lawful. Furthermore the discretion is exercised in a lawful manner, if in its exercise all material considerations have been taken into account, due weight is given to material facts and has not been based on a misconception of law or fact. A defective exercise of discretionary power may, therefore, amount to an excess or abuse of power. In the present case it has not been argued, and nothing has been suggested to show, that the discretion was not exercised in a proper way. [*661]

For the reasons given in this judgment this application cannot succeed and is hereby dismissed. No order as to costs.

Application dismissed.

No order as to costs.