Chief Justice discharges orders previously granted Patmar Industries
ACTING Chief Justice Ian Chang has discharged orders or rules nisi of certiorari and prohibition granted, by Justice Jainarayan Singh on March 6, 2008, against Guyana National Co-operative Bank (GNCB). He said there is no doubt that GNCB, as a body created by statute is, as a matter of principle, amenable to the process of judicial review.
“But only if the particular issue relates to a matter of public law and not purely private law,” the Chief Justice said.
Patmar Industries Limited had asked the court to discharge the instructions, on the ground that the motion to grant public law remedies, by way of the judicial review process, was wholly misconceived.
Delivering his decision, Justice Chang said: “The affidavits filed in this matter are rather lengthy and the court does not see the necessity of repeating all the allegations of fact made therein.
“For the purpose of this decision, it suffices to state that the GNCB is a commercial bank established by statute and that it was the creditor of Patmar Industries Limited, a private company, to which it had loaned various sums of money under loan agreements.
“There can be no doubt that the relationship between the Bank and the company is between a statutory body, as creditor and a private individual, as debtor, as far as those loan agreements go.
“The question which arises is whether that contractual or commercial relationship remained purely contractual or commercial and was not infected with a public law element if the bank, in the course of the relationship, did exercise its statutory power under Section 27 of the National Co-operative Bank Act, Chapter 85:03 or Section 37 of the Co-operative  Financial Institutions Act, Chapter 75:03. Those two sections are similarly worded.
“It is the claim of the company that the Bank did, by letter, release a part of the loans made to it in the exercise of its discretionary power under Section 27 (b) and that the exercise of the discretionary power in favour of the company infected the relationship with a public law element, giving rise to the public law concept of legitimate expectation in the company.
Discretionary power
“It must be noted that the company, in these proceedings, does not at all challenge the manner in which the Bank might have exercised its statutory discretionary power. Rather, the company seeks to rely on the validity of the exercise of that power.
“In the view of the court, the exercise of the statutory discretionary power, either under Section 27 of the Guyana National Co-operative Bank Act or Section 37 of the Co-operative Financial Institutions Act, would have affected the factual state of contractual or commercial relationship between the parties, in that the indebtedness of the company to the Bank might have been reduced.
“But it did not alter or change the legal nature of that relationship from one purely of private law. Simply put, the exercise of the statutory discretionary power, by the Bank in favour of the company, would have affected the factual state of affairs between the partners in private law but effected no change on the legal nature of the relationship, as one purely of private law, since the company derived no public law right under Section 27 of the Guyana National Co-operative Bank Act or Section 37 of the Co-operative Financial Institutions Act.
“The issue at hand is not at all how the statutory power was exercised but, rather, the effect of the exercise of that power on the assumption that it was validly exercised.”
In conclusion, the Chief Justice added: “The challenge is to the right of the Bank, in private law, to recover or to seek to recover money allegedly owed to it by the applicant company. In such circumstances, no public law right is involved and the process of judicial review is not attracted.”
Accordingly, this court must discharge the orders or rules nisi of certiorari and prohibition, on the ground that the motion to grant public law remedies by way of the judicial review process was wholly misconceived.
Justice Chang awarded $50,000 costs to the respondent GNCB, which was represented by Mr. Timothy Jonas.
Senior Counsel, Edward Luckhoo and Mr. Stephen Fraser appeared for Patmar Industries Limited.