McClean v Barbados Light and Power Company Ltd
| Jurisdiction | Barbados |
| Judge | Douglas, J.A. |
| Judgment Date | 31 July 1980 |
| Neutral Citation | BB 1980 HC 34 |
| Docket Number | No. 375 of 1980 |
| Court | High Court (Barbados) |
| Date | 31 July 1980 |
High Court
Douglas, C.J.
No. 375 of 1980
The appellant in person.
J.S.B. Dear, Q.C., O.M. Browne, Q.C. and C.W.P. Chenery for the respondent.
Company Law - Public Utilities — Rates — An appeal against the decision and order of the Public Utilities Board whereby, on a review of the Board's decision, new rates were fixed — The court noted that by virtue of the Public Utilities Act, Cap. 282 the PUB had a duty to fix reasonable rates and the instant appeal was limited only to questions of law — The main ground of appeal concerned whether the court should set aside depreciation rates allowed by the Board in its previous decision — Finding that claims of a mathematical error in a rate fixing case must bring into question, the procedures adopted by the Board — That the main grounds of appeal complained of errors in the Board's calculations. Finding that it had not been shown that the methodology of the Board was defective or that it had been misapplied and also that although error had crept into the application of an appropriate methodology, the difference was not so substantial as to effect the rates to the extent of making them unfair or unreasonable — Appeal dismissed.
This is an appeal against the Decision and Order of the Public Utilities Board (hereinafter called “the Board”) dated the 16th of May, 1980 whereby on a review of the Board's decision of the 28th of December, 1979, new rates were fixed to become effective in respect of all meters read on or after the 1st of June 1980.
The Board is a corporation established under the Public Utilities Act, Cap. 282, with powers to regulate certain activities of public utility enterprises and to determine fair and reasonable rates for services provided by public utilities. Under Section 20(1) of the Act, whenever the Board after a hearing finds that the existing rates of any public utility for any service are unfair or unreasonable or contrary to law, the Board has a duty to fix fair and reasonable rates, including maximum and minimum rates, to be thereafter observed. Section 22(2) empowers the Board to intervene where it is of opinion that any rates of any public utility are producing a return in excess of a fair return upon the fair value of the property of such public utility used and useful in its public service. For the purposes of the Act, the terms “unjust” and “unreasonable” in relation to rates are defined as including injustice and unreasonableness “whether arising from the fact that rates are excessive as being more than a fair and reasonable charge for service of the nature and quality furnished by the public utility, or from the fact that rates are insufficient to yield fair compensation for the service rendered or arising in any other manner.”
The Barbados Light and Power Company Limited (hereinafter called “the Company”) is a public utility within the meaning of the Act and had sought by letter dated the 20th of April, 1979 an increase in the rates chargeable by it. After a hearing lasting several weeks, the Board fixed new rates on the date in 1979 mentioned above. Both the appellant, who had been an objector at the hearing, and the Company requested a review of the Board's decision under the provisions of Section 44 of the Act and it was after a further hearing lasting some two weeks that the Board in May, 1980 revised upwards the rates it had fixed in December, 1979. The Board described its task as being “difficult, complex and time consuming” and requiring” the consideration and understanding of concepts and principles of law and economics as well as general accounting principles”. At the original hearing five objectors appeared including the present appellant. The record of those proceedings fills 2,358 pages of typescript and in addition there are large numbers of documentary exhibits, schedules, projections and submissions. The volume of evidence seems disproportionate both to the number of witnesses (there were only five) and to the issues raised between the Company and the objectors and much of it is irrelevant to those issues or repetitive.
As to the review, the only parties to appear were the appellant and the Company and, that notwithstanding, the Board sat for eight days hearing argument, the record of which is contained in some 399 pages.
This matter now comes before me on appeal under Section 45 of the Act purely on questions of law. It is incumbent, therefore, on the, appellant to show that a question of law is involved before he can obtain relief on any of the grounds of appeal set out in his Notice of Motion. It is not enough to preface every ground of appeal by the words “the Board erred in law” or “the Board made a legal error” to bring the matters raised in this appeal within the category of questions of law [see per Wylie J. in Williams v. Waterman (1961) 3 W.I.R. 499. The grounds fairly stated must genuinely raise a question of law.
As to what constitutes a question of law, the following passage from de Smith on Judicial Review of Administrative Action, 3rd edition, at page 117 illustrates the scope of the expression -
“The concept of error of law includes the giving of reasons that are bad in law or (if there is a duty to give reasons) inconsistent, unintelligible or, it would seem, substantially inadequate. It includes also the application of a wrong legal test to the facts found, taking irrelevant considerations into account and failing to take relevant considerations into account, exercising a discretion on the basis of any other incorrect legal principles, misdirection as to the burden of proof, and wrongful admission or exclusion of evidence, as well as arriving at a conclusion without any supporting evidence”.
Williams J. in the case of Barbados Telephone Co. v. The Attorney General et al (No. 416 of 1974) pointed out that an error of law can arise from a variety of circumstances including the misinterpretation of a statute or any other legal document or a rule of common law as well as those mentioned above. He went on to observe that the determination of primary facts is not a matter of law, but to make a finding unsupported by any evidence is an error of law.
In this regard the distinction between findings of primary facts and conclusions drawn from those facts must be kept in mind. As Denning J said in Bracegirdle v. Oxley (1947) K.B. 349
“The question whether a determination by a tribunal is a determination in point of fact or in point of law frequently occurs. On such a question there is one distinction that must always be kept in mind, namely, the distinction between primary facts and conclusions from those facts. Primary facts are facts which are observed by the witnesses and proved by testimony; conclusions from those facts are inferences deduced by a process of reasoning from them. The determination of primary facts is always a question of fact. It is essentially a matter for the tribunal which sees the witnesses to assess their credibility and to decide the primary facts which depend on them. The conclusions from those facts are sometimes conclusions of fact and sometimes conclusions of law. In a case under s. 11 of the Road Traffic Act, 1930, the question whether a speed is dangerous is a question of degree and a conclusion on a question of degree is a conclusion of fact. The Court will only interfere if the conclusion cannot reasonably be drawn from the primary facts…”
The primary facts in the instant case are to be sought in the parol evidence of the witnesses and in the audited financial statements, financial forecasts, inventories and computations exhibited. The Company's Secretary Treasurer, a highly qualified chartered accountant, gave evidence as well as the Company's Managing Director, Mr. McConney, and its Chief Engineer. In addition the Company called two expert witnesses to testify on valuation of the Company's plant and on public utility accounting procedures. On one aspect of the case at the review Mr. Emtage, the Director of Finance and Planning in the Ministry of Finance produced a document emanating from the World Bank. Great care has to be exercised in isolating the evidence from the mass of suggestions, assumptions, double assumptions, hypothetical cases and theories put to the witnesses which were either not accepted at all or were accepted subject to exceptions, reservations and the like. It must also be borne in mind that although all sorts of suggestions and theories were put to the witnesses, especially by the appellant, neither he nor any of the other objectors called any evidence in support of these suggestions and theories.
In its decision of the 28th of December, 1979 the Board expressed itself as being concerned with the public interest as well as the Company's interests in the matter of the fixing of rates. The Board declared that it was guided by the principle that rates should be fair and reasonable and should take into consideration not only the public interest but also the interests of the Company and its shareholders, and that the Company is entitled to a rate of return that is fair and reasonable. This accords with the duties imposed on the Board by Sections 20 and 22 of the Act which are mentioned above. It is also in keeping with the views of Gomes C.J. in the case of Barbados Light and Power Co. Limited in 1957 where that learned Chief Justice stated -
“I consider therefore that, in determining whether the rates are fair and reasonable, the criterion is that which will produce a fair return on the fair value of the Company's property, used and useful, in its public services”
There is one further aspect of the 1957 case to which I would refer. It relates to the powers of the Board vis-à-vis the Company. On this subject Gomes C.J. observed –
“It is important to bear in mind that the public utility is...
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