The Application for a Rate Adjustment and the Introduction of Usage Based/Flat Plans (No. 3 of 2003) v the Fair Trading Commission Act CAP. 326B

• Jurisdiction: Barbados
• Court: Fair Trading Commission (Barbados)
• Judge: Sir Neville V. Nicholls,Andrew Downes,Mr. Gregory Hazzard
• Judgment Date: 02 May 2007

In the Matter of the Application for a Rate Adjustment and the Introduction of Usage Based/Flat Plans (No. 3 of 2003)

filed by

Cable & Wireless (Barbados) Limited

And In the Matter of an Application for Costs by Intervenors Pursuant to Section 46 of the Fair Trading Commission Act Cap. 326B

In the Matter of the Fair Trading Commission Act CAP. 326B

And in the Matter of the Utilities Regulation Act CAP. 282

And in the Matter of the Utilities Regulation (Procedural) Rules S.I. 2003 No. 104

Before:

Sir Neville V. Nicholls

Chairman

Professor Andrew Downes

Commissioner

Mr. Gregory Hazzard

Commissioner

THE FAIR TRADING COMMISSION

DECISION AND ORDER

TABLE OF CONTENTS

PART ONE – NATURE OF PROCEEDINGS	1
PART TWO – BACKGROUND	2
PART THREE – SUBMISSIONS Written Submissions i) Mr. Michael Carrington for Mr. Leroy McClean ii) Mr. Alvin Cummins iii) Mr. Hallam Hope for CARITEL iv) Mr. Olson Robertson v) Mr. Malcolm Gibbs-Taitt for BARCRO vi) Mr. Noel Smith vii) Mr. Alvin Thorpe viii) Mr. Barry Carrington, Public Counsel for the Barbados Council for the Disabled Oral Submissions i) Mr. Michael Carrington for Mr. Leroy McClean ii) Mr. Alvin Cummins iii) Mr. Hallam Hope for CARITEL iv) Mr. Olson Robertson v) Mr. Malcolm Gibbs-Taitt for BARCRO vi) Mr. Noel Smith vii) Mr. Alvin Thorpe viii) Mr. Barry Carrington, Public Counsel for the Barbados Council for the Disabled ix) Mr. Patterson Cheltenham, Q.C. for Cable & Wireless (Barbados) Limited	6
PART FOUR – THE LAW i) The Nature of Costs ii) Exercise of Discretion Generally iii) Exercise of Discretion in relation to Costs in Civil Proceedings	23
PART FIVE – THE REASONING i) Exercise of Discretion to Award Costs in Regulatory Proceedings ii) The Role of Public Counsel iii) Rate Adjustment Application was not Frivolous and Vexatious iv) Submissions on Entitlement to Costs v) Contributions of Intervenors vi) Administrative Costs vii) Retroactivity of Cost Assessment Guidelines viii) Amortization of 1993 Cable & Wireless Rate Hearing Expenses	26
PART SIX – CONCLUSION	34
PART SEVEN – COMMISSION'S ORDER	37

PART ONE — NATURE OF PROCEEDINGS

On February 14 ^th 2007, the Fair Trading Commission (“the Commission”) held a public hearing at Sherbourne Conference Centre. The hearing was held pursuant to orders of the Commission dated July 30 ^th 2004 and January 17 ^th 2005.

The purpose of the said hearing was to determine how the Commission would exercise its discretion in relation to an order for the costs of the 2003 rate adjustment application by Cable & Wireless (Barbados) Limited and the eligibility of persons participating therein to recover such costs.

The Commission issued a procedural direction on January 17, 2007 wherein it was made clear that submissions were to include reasons why persons so applying should be allowed to recover costs in the form of expenses and who should pay the said costs. The aforementioned Procedural Direction also indicated that in keeping with the opinion of the High Court in Suit No. 373 of 2006 (“the Case Stated”), only submissions dealing with the recovery of costs of out-of-pocket expenses would be considered for persons not represented by an Attorney-at-Law.

PART TWO — BACKGROUND

1 On August 5, 2003 Cable & Wireless submitted an application to the Commission seeking to move from the current flat rate tariff system to a revised usage based system for residential and business users (domestic rate payers) of the domestic service.

2 As a result of the Cable & Wireless application, the Commission convened a rate adjustment hearing to deal with the issues. A number of domestic consumers of telecommunications services and at least one interested party (collectively and herein after referred to as “intervenors” by virtue of the Utilities Regulation (Procedural) Rules 2003) were allowed to intervene and participate in the hearing on behalf of Barbadian consumers. Twelve (12) of the intervenors were not represented by legal counsel during the hearing.

3 At the end of the process, by way of a decision and order dated July 20, 2004, Cable & Wireless' application was denied by the Commission. It was further ordered that the existing rates for the domestic telephone service should prevail and that the Commission (pursuant to an application by the intervenors) would hear the parties on costs on a date to be determined. The Commission confirmed its decision on January 17, 2005 after hearing a motion to review.

4 In keeping with the Commission's order of July 20 ^th, 2004 aforesaid, the Commission convened a cost hearing on February 14, 2007.

5 While the Commission has the discretionary authority to award costs of and incidental to any proceeding before it under section 46 of the Fair Trading Commission Act CAP. 326B (“FTCA”), there were no regulations or guidelines to aid the Commission in making such an award.

6 The Commission wishing to ensure transparency in the process leading to the award of costs, developed a set of guidelines which would assist it in relation to the awarding of costs.

7 When the drafting of these guidelines commenced, the Commission was of the view that the statutory discretion to award costs conferred on the Commission extended to the granting of an honorarium for intervenors that would represent an acknowledgement of the time spent in preparing for the hearing and appearing before the Commission.

8 The Commission subsequently completed and disseminated the Draft Cost Assessment Guidelines in December of 2005 and as previously stated embarked on a public consultation process and invited written comments on this document. The necessity for a public consultation arose from suggestions made by members of the public and other stakeholders in October 2005, and dovetailed well with the Commission's statutory duty to consult with the public as aforementioned.

9 Many of the intervenors who responded to the public consultation appeared to interpret section 46 to mean that the law mandates that intervenors be paid costs. Additionally, the intervenors were of the view that they should be paid for appearing before the Commission and for preparing and presenting arguments in much the same way that an Attorney-at-Law before the High Court would be paid on a party-and-party basis. This position on the part of intervenors was made clear in their contributions to the public consultation exercise.

10 Some of the parties who responded to the said exercise objected to the insertion of the honorarium clause as stated in the guidelines. Additionally, various legal arguments were raised which suggested that the Commission may be acting ultra vires the Fair Trading Commission Act CAP. 326B in granting the said honorarium or any sums other than out of pocket expenses to intervenors as costs. In the circumstances, the possibility of an application for judicial review being made against the Commission was also raised. It was also suggested that the Commission should proceed by way of Case Stated to obtain an opinion from the High Court.

11 In light of the divergence of views between the intervenors, and some of the other persons who commented on the Draft Cost Assessment Guidelines, and the serious questions of law that arose, the Commission determined that the most appropriate recourse open to it was to state a case for the opinion of a Judge under section 41 of the Fair Trading Commission Act CAP. 326B.

12 The following questions were asked by the Commission of the Court:

• a. Whether the discretionary power given to the Commission under section 46 of the Fair Trading Commission Act CAP. 326B allows the Commission to award costs to intervenors who were not represented by Legal Counsel for preparing for and appearing at a Commission proceeding.

• b. Whether the discretionary power given to the Fair Trading Commission under section 46 of the Fair Trading Commission Act CAP. 326B allows the Commission to award an honorarium to intervenors who were unrepresented by Legal Counsel in recognition of individual efforts in preparing and presenting a submission to the Commission.

• c. Whether on the basis of settled practice in Barbados, a person who is unrepresented by Legal Counsel and appearing before an administrative tribunal, where a power to award costs exists, is limited to an award of out of pocket expenses only.

13 The Case Stated was heard before the Honourable Mr. Justice Christopher Blackman in Court No.2 on May 10, 11 and 12, 2006. Parties in the Case Stated included Cable & Wireless (Barbados) Limited represented by learned Queen's Counsel Mr. Patterson Cheltenham, Mr. Barry Carrington, Public Counsel on behalf of the Barbados Council for the Disabled, BARCRO represented by Attorney-at-Law Mr. Therold Fields, Mr. Hallam Hope for CARITEL, Mr. Roosevelt King for BANGO, Mr. Alvin Cummins in person and Mr. Alvin Thorpe in person.

14 The decision on the case stated was delivered on September 28, 2006 and the Court answered the first question in the negative, the second in the negative and the third in the affirmative.

15 Therefore, the Commission completed the Cost Assessment Guidelines and issued a decision in relation thereto on January 17, 2007. A hearing on costs was fixed for February 14 and 15, 2007 in keeping with the previous orders of the Commission and a procedural direction was issued.

PART THREE — SUBMISSIONS

WRITTEN SUBMISSIONS

Mr. Michael Carrington for Mr. Leroy McClean

16 Mr. Carrington submitted that his client, Mr. McClean, is eligible for costs fit for one counsel as well as disbursements based on the following grounds:

• a. Having been granted intervenor status, he participated as fully as practicable and responsibly in the proceedings, thus contributing to the Commission's better understanding of the issues raised.

• ...