Supreme Court allows appeal dismissing pensioners' claim for cost of living allowance tied to index. Status difference justifies unequal treatment under Constitution.

[*1539] 1972 June 20

(TRIANTAFYLLIDES, P., L. LOIZOU, A. LOIZOU MALACHTOS, JJ.

APPELLATE JURISDICTION

The Republic of Cyprus, through the Ministry of Finance,

Appellant,

v.

Nishian Arabian and others,

Respondents.

(Revisional Jurisdiction Appeal No.95).

Constitutional Law - Article 28.1 of the Constitution – Equality - Principle of equality - When contravened - Refusal to pay pensioners public officers a cost of living allowance tied to the cost of living index as paid to serving public officers - Does not, in the circumstances, amount to a differentiation between serving and pensioner public officers which, in the light of the proper application of the principle of equality, is contrary to, or inconsistent with, the said Article 28.1 of the Constitution.

Public Officer - Pensioner Public Officer - Who retired after the coming into force of the Constitution in 1960 – Refusal to pay him cost of living allowance tied to the cost of living index - Does not infringe any right of his safeguarded under Article 192 of the Constitution.

Public officers - Serving and Pensioner Public Officers – Their status are essentially different both factually and legally - Refusal to pay pensioner public officers cost of living allowance tied to the cost of living index -Not contrary to Article 28.1 of the Constitution.

Equality - Principle of Equality - Article 28.1 of the Constitution - Refusal to pay pensioners public officers cost of living allowance tied to the cost of living index – Does not offend against the principle of equality.

Pensioners - See under “Constitutional Law”; “Public officers”.

L. Loucaides, Senior Counsel of the Republic, for the Appellant.

L. Clerides, for the Respondents.

JUDGMENT

The judgment of the Court was delivered by: -

TRIANTAFYLLIDES. P.: This is an appeal [*1540] from the decision* of a judge of this Court in relation to a recourse which was made by the respondents, who are pensioners public officers, against the refusal of the Ministry of Finance to pay to them a cost of living allowance tied to the cost of living index in the same manner as such an allowance is being paid to serving public officers. The learned trial judge decided that the refusal of the Ministry of Finance violated the respondents’ right to equal treatment, safeguarded by Article 28(1) of the Constitution; and this appeal was made on the ground that no such violation has taken place.

The sub judice decision of the Ministry of Finance was communicated by a letter dated the 3nd December, 1969, which was written in reply to a letter of counsel for the respondents claiming a cost of living allowance tied to the cost of living index; in refusing such an allowance the Ministry of Finance stated that increases of pensions are granted in accordance with the from time to time prevailing circumstances, that an increase 19 1/2% of had been granted recently and that the matter of a further increase of pensions could be examined when this would become necessary.

The existence of an established Government practice to grant increases of pensions from time to time due to rises in the cost of living index is shown by the contents of an Appendix to the Opposition which was filed by the Republic in the proceedings before the trial judge; such increases of pensions are granted as revisions of pensions and not by [*1541] means of a cost of living allowance tied to the variations of the cost of living index.

It is quite clear that we are not concerned in this case with either a refusal of the Government to increase pensions in accordance with, its aforementioned practice or with a decision of the Government to discontinue such practice; nor are we dealing with any complaint regarding the manner of the implementation of the said practice in relation to any specific category of pensioners public officers. The issue before us is whether, on the strength of the right to equal treatment, under Article 28(1) of the Constitution, the respondents as pensioners public officers are entitled to a cost of living allowance tied to the cost of living index., as such an allowance is paid to serving public officers.

The application of the “principle of equality” has been considered in Mikrommatis and The Republic, 2 R.S.C.C., 125, where it was stated (at p. 131) that “equal before the law in paragraph 1 of Article 28 does not convey the notion of exact arithmetical equality but it safeguards only against arbitrary differentiations and does not exclude reasonable distinctions which have to be made in view of the intrinsic nature of things”; and the Mikrommatis case was followed in, inter alia, Panavides and The Republic. (1965) 3 C.L.R. 107, Louca and The Republic.

(1965) 3 C.L.R. 383, and Impalex Agencies Ltd. and The Republic,

(1970) 12 J.S.C. 1236. [*1542]

Valuable guidance can be derived in this respect from

decisions of the Greek Council of State (“Συμβούλιον Επικρατείας”). In addition to the decision

in Case 2080/50, which is mentioned in the judgment appealed from, the following decisions may be also referred to:-

In Case 1273/65 it was stated that the principle of equality entails the equal or similar treatment of all those who are found to be in the same situation (“η συνταγματική αρχή της ισότητος, υπό την έννοιαν της ίσης

ή ομοιομόρφου μεταχειρίσεως πάντων των υπό τας αυτάς συνθήκας τελούντων”).

In Case 1247/67 it was held that the principle of equality safeguarded by Article 3 of the Greek Constitution of 1952 - which corresponds to Article 28(1) of our Constitution - excludes only the making of

differentiations which are arbitrary and totally unjustifiable (“Διότι το άρθρον τούτο, ορίζον ότι οι Έλληνες είναι ίσοι ενώπιον του Νόμου, αποκλείει μόνον την υπό του νομοθέτου θέσπισιν διακρίσεων αυθαιρέτων και όλως αδικαιολογήτων“); and exactly the same was

held in Case 1870/ 67.

In Case 2063/68 it was held that the principle of equality was not contravened by regulating differently matters which were different from

each other (“ουδόλως προκύπτει παραβίασις της αρχής της ισότητος και ως εκ τούτου ακυρότης των προσβαλλομένων πράξεων, εφ’ όσον πρόκειται περί ρυθμίσεων σχέσεων τελουσών υπό διαφόρους πραγματικάς συνθήκας, αίτινες δεν αποκλείουν ανομοιομορφίας εν τω διακανονισμώ αυτών”). [*1543]

In Case 1215/69 it was held that the principle of equality

is applicable to situations which are of the same nature (“την αρχήν της ισότητος εφαρμοστέαν επί περιπτώσεων τελουσών υπό τας αυτάς εν γένει συνθήκας”).

In the United States of America the application of the principle of equality has been dealt with in numerous cases decided by the Supreme Court; in addition to the cases of Missouri Pacific Railway Company v. Humes, 115 US 512, 29 L.ed. 463, Lindsley v. Natural Carbonic Gas Company, 220 US 6l, L.ed. 369, Power Manufacturing Co. v. Saunders. 274 US 490, 71 L.ed. 1165, and Tigner v. State of Texas,

310 US 141, 84 L.ed. 1124, which have been cited in the Judgment appealed from, the following cases may be referred to also: -

In Senior v. Oregon State Board of Dental Examiners. 294 US 608, 79 L.ed. 1086, it was held that an enactment making the use of certain types of advertising a ground for revocation, of a licence to practise dentistry was not unconstitutionally discriminatory because it did not extend to other professional classes; in his Judgment Chief Justice Hughes stressed (at p. 1089): -

“The State was not bound to deal alike with all these classes, or to strike at all evils at the same time or in the same way”.

In American Federation of Labour v. American Sash & Door Company. 335 US 538, 93 L.ed. 222, it was held that a State constitutional amendment which prohibits employment [*1544] discrimination against non-union workers, but not against union workers, does not deny union workers equal protection of the laws, particularly where they are afforded protection by State laws, even though it is not clear whether there is afforded the same kind of sanction to both classes of workers.

In Williamson v. Lee Optical of Oklahoma.

348 US 483, 99 L.ed. 563, it was held that no violation of the equal protection clause of the Fourteenth Amendment to the U.S.A. Constitution had resulted from the fact that a State statute regulating the business of opticians exempted from regulation all sellers of ready-to-wear glasses. In his judgment Mr. Justice Douglas stated (at p. 573): -

“Evils in the same field may be of different dimensions and proportions, requiring different remedies …. The prohibition of the Equal Protection Clause goes no further than the invidious discrimination”.

In Morey v. Doud. 354 US 457, 1 L.ed. 2d. 1485, Mr. Justice Burton adopted (at p. 1U90), inter alia, the view, which was expressed earlier in the Lindsley case (supra) by Mr. Justice Van Devanter, that

“A classification having some reasonable basis does not offend against that clause1 - the equal protection clause - merely because it is not made with mathematical nicety or because it results in some inequality”. [*1545]

In Levy v. Louisiana, 391 US 68, 20 L.ed. 2d 436, Mr. Justice Douglas pointed out (at p. 439) in his judgment: -

“In applying the Equal Protection Clause to social and economic legislation, we give great latitude to the legislature in making classifications.”

An exposition of the principle of equality can he found, also, in the decision of the European Court of Human Rights, of the Council of Europe, in the case “Relating to certain aspects of the laws on the use of languages in education in Belgium”, which was decided in 1968; it was stated in this decision (at p. 34): -

“…the Court, following the principles which may be extracted from the legal practice of a large number of democratic States, holds that the principle of equality of treatment is violated if the distinction has no objective and reasonable justification.”

Article 28(1) of our Constitution reads as follows: -

“All persons are equal before the law, the administration and justice and are entitled to equal protection thereof and treatment thereby”.

As correctly pointed out by the trial judge the provision made by Article 28(1) excludes discrimination in State action not only in the legislative but also in the administrative sphere of Government. [*1546]

In the light of the foregoing review of the law we have now to decide whether or not the complained of decision of the Ministry of Finance is contrary to, or inconsistent with, Article 28(1), as it was found to be by the trial judge:

The status of a serving public officer and that of a pensioner public officer are, obviously, essentially different, both factually and legally; they may be similar or analogous to each other in certain respects but the differences outweigh definitely any similarities or analogies.

As it appears from the material on record before us the Government has been adopting, by way of social and economic policy, different means in order to enable serving public officers and pensioners public officers, respectively, to meet the rising cost of living; though in both cases such means relate to rises of the cost of living index, pensioners public officers do not receive, as serving public officers do, a cost of living allowance tied to the fluctuations, upwards or downwards, of the cost of living index, but there exists an established practice of Government - (even if such practice might not be taken as creating a relevant vested right) - to grant from time to time increases of pensions in view of rises in the cost of living index.

In the circumstances, and especially as the sub judice refusal of the Ministry of Finance to grant to the respondents a cost of living allowance tied to the cost of living index has been coupled with a statement of readiness [*1547] to consider, instead, when necessary, the grant of increases of pensions in accordance with the aforementioned established practice, we are of the opinion that it ought not to be held that such refusal amounts to a differentiation between serving public officers and pensioners public officers which, in the light of the proper application of the principle of equality, is contrary to, or inconsistent with, Article 28(1) of the Constitution, It was up to the respondents, as the persons complaining of unequal treatment (see, inter alia, Lindsley. supra, and Morey, supra), to show that the

decision in question of the Ministry of Finance did not rest upon any reasonable basis and that it was essentially arbitrary; and they have failed to do so.

It is to be noted that one of the respondents, Bamboskis, is a pensioner public officer who retired from the public service in 1965 - after the coming into force of the Constitution in 1960 - and so it has to be examined if any right of his, as a serving public officer in 1960, which is safeguarded under Article 192 of the Constitution, has been infringed by the sub judice decision: We take the view that no such infringement has taken place because at the time when the Constitution came into force the terms and conditions of service of this respondent /did not include the right to a pension supplemented by a cost of living allowance tied to the cost of living index.

For all the reasons set out in this judgment this appeal is allowed and consequently the recourse of the respondents, in which the appealed from first instance decision was given, is dismissed.

Appeal allowed.

* Reported in

(1972) 1 J.S.C. 4.