[1946] EACA 75

## APPELLATE CIVIL

## Before HORNE, J.

### UJAGAR SINGH, Appellant (Original Plaintiff)

#### v.

# MUNICIPAL COUNCIL OF NAIROBI, Respondent (Original Defendant) Civil Appeal No. 7 of 1946

Rickshaws-Licensing of public rickshaws-General resolution by Council not to license any rickshaw—Individual application not considered—Licences

refused—Duties of Council as a licensing authority—Appeal.

The appellant owned a number of rickshaws which plied for hire within. the municipal area under licence from the Municipal Council in accordance with Municipal By-laws.

$\mathcal{O}(\mathcal{O}^{\mathcal{O}})$ The Municipal Council having passed a general resolution that no licence be granted for public rickshaws after a certain date the application of the appellant for licences for his rickshaws was refused.

The appellant appealed to the Subordinate Court. His appeal having been unsuccessful he further appealed to the Supreme Court.

Held (15-10-46).-(1) The Council in passing resolutions is acting in one capacity and in issuing licences which it is empowered to grant it is acting in a different capacity, i.e. as a judicial body.

(2) The Council in its capacity of a licensing authority cannot by general resolution prohibit a particular activity that can only lawfully be carried on with its licence. It must consider each application on its individual merits.

Appeal allowed. Council ordered to issue licences.

Cases referred to: Rex v. London County Council, ex parte Corrie (1918) 1 K. B. 68; Rex v. Barry District Council, ex parte Jones 16 T. L. R. 565; Rex v. Sylvester 31 L. J. $(M. C.)$ 93.

# Modera for the Appellant.

## Schermbrucker for the Respondent.

JUDGMENT.—This is an appeal from the Resident Magistrate, Nairobi, who dismissed an appeal to him under Section 78 of the Local Government (Municipalities) Ordinance, 1928. The appellant, Ujagar Singh, has for some years been engaged in the business of a public rickshaw proprietor. Under the above<br>Ordinance the Nairobi Municipal Council have made by-laws relating to the licensing of public rickshaws, i.e. of rickshaws which may ply for hire. It is conceded that the Ordinance does not give the Council power to make by-laws for the prohibition of rickshaws, but it was argued by Mr. Schermbrucker for the Council that if the Council decide to refuse all applications for licences on the ground that the grant of such licences is contrary to the public interest they are empowered to do so by virtue of Section 78.

The section reads as follows:—

"The Council may refuse to grant any licence to carry on any trade or business which it is empowered to grant, on any of the following grounds: —

- (a) That within the three years immediately preceding the application either the applicant or any person employed by or assisting him in his business or directly or indirectly interested therein has been convicted three times of contravening a law or by-law in force within the municipality in regard to the trade for which the licence is applied for; - (b) That the premises in or on which the applicant intends to carry on his trade or business do not conform to the requirements of the Council's by-laws;

(c) That the granting of such licence would be contrary to the public interest:

Provided, however, that any applicant for a licence whose application has been refused may appeal against the Council's decision to the Court of the Magistrate within whose jurisdiction the premises in or on which the the applicant intended to conduct his trade or business lies, and, in the event of the appellant satisfying the Court that the licence was refused on insufficient grounds, the Court may order the Council to grant such licence and such licence shall be granted accordingly:

Provided, further, that the appellant or the Council may appeal to the Supreme Court against any such order of the Magistrate, and the decision of the Supreme Court shall be final."

Mr. Modera, for the appellant, submits that this is what he calls an "individualistic section" and under it each application must be considered on its merits. Further, as there is no power to prohibit rickshaws under the by-laws. it is beyond the powers to deal with the appellant's application for licences for the rickshaws owned by him on the basis of a general resolution that the Council have decided to grant no licences at all. Such a supression of rickshaws, he contends, cannot be obtained without further statutory powers and new by-laws. Apart from the grounds for refusal being insufficient in law, he submits that the evidence before the Resident Magistrate does not relate to conduct of the appellant. That is so, but it is not important except to show that it was upon such evidence the Council had acted in passing the resolution. It is somewhat surprising to me that the appeal was instituted by a plaint and that the Council put in a defence as if the proceedings were a suit and not an appeal; but apparently it has been the practice in the past so to proceed. Apparently a further amendment of Order 39 of the Civil Procedure Rules is necessary.

Section 78 neither adds to nor detracts from the powers and duties of the Council as the licensing authority. Sub-sections (2) and (3) of section 77 lay down the procedure for hearing applications. Objectors to the grant of a licence, such as the police, may be heard. Section 78 sets out specific grounds on which a licence to carry on any trade or business may be refused. It is probable that the ownership of rickshaws is a business. Though it is arguable that as licences for trades and businesses are dealt with in Part IV of the by-laws and public rickshaws are dealt with under Part V which deals with vehicles, Section 78 has no application to the licences applied for by the appellant. Section 81 of the Ordinance deals with refusal of a licence to a rickshaw hauler. But under the by-laws, No. 364 makes it an offence to use an unlicensed vehicle which would include a rickshaw. No. 371 defines "a public vehicle" as meaning a vehicle plying for hire, except rickshaws, which are then dealt with separately in Section 12 of Part V as "public rickshaws" by by-laws 419 to 452. Of these, No. 420 (a) also makes it an offence to have an unlicensed public rickshaw. No. 420 (e) and $(f)$ provide procedure for applying for a licence and for hearing the application, comparable with Section 77 of the Ordinance. No. 420 $(g)$ provides that licences are "to be so issued that every licensee shall be the owner of at least six serviceable public rickshaws". Consequently though each vehicle is licensed separately, the licence issued may be said to be a licence to carry on a trade or business under Section 78. But as this point has not been argued I make no attempt to decide it. No. 420 (j) shows that the grant of a licence for a public rickshaw is discretionary.

Nevertheless the appeal has been brought and no doubt had to be brought under Section 78 because of the attitude taken up by the Council as expressed in the correspondence put before the Resident Magistrate. First the Council gives notice on 23rd December, 1944, to the appellant that no licences will be granted for public rickshaws as and from 30th June, 1945. Being asked for the reason the Town Clerk replied on 13th March, 1945, to the effect that the Council on 19th December had adopted a resolution of the General Purposes Committee in these $terms:$ —

"That no licences be granted for public rickshaws to ply for hire within. the Municipality after the 30th day of June, 1945, and that six months' notice be given accordingly to the owners of rickshaws at present plying for hire." After referring to the by-laws the Town Clerk added:-

"You will observe also that under Section 78 of the above-mentioned Ordinance that the Council can refuse to grant any licence to carry on a trade or business on the grounds that the granting of such licence would. be contrary to the public interest."

Further correspondence ensued and Section 78 is referred to again in the letter of 22nd June, 1945:—

"The Municipal Council is of opinion that the granting of licences for rickshaws to ply for hire after the 30th day of June next would be contrary to public interest."

Further protests were made by the appellant's Advocate and he was invited. to attend a meeting of the General Purposes Committee to hear its views on the matter.

The matter then went to the Resident Magistrate on appeal, it being accepted that the application for licences for 20 rickshaws had been refused as the grant of the same was contrary to the public interest. The proceeding, as I have said, was conducted as a suit and at the hearing the documentary evidence to which $I$ have already referred was given. In addition oral evidence was given by the Native Affairs Officer of the Council, the Town Clerk and Superintendent Elliott of the Kenya Police. This evidence is evidence of opinion. It disclosed no specific act of misconduct by the appellant. It did not even refer to a rickshaw boy employed by him or to whom he had hired out a public rickshaw. In fact it discloses the nonsensical position taken up that prostitution and those who live upon it can be suppressed if rickshaws are abolished. There was evidence, again of opinion, that rickshaws would obstruct traffic in the day time; the same may be said of a handcart carrying goods pushed by two men. After discussing such evidence in his judgment the Resident Magistrate finally said:

"In the result I do not think it can be said that the Council acted on insufficient grounds when deciding that rickshaws were contrary to the public interest".

and dismissed the appeal.

The learned Resident Magistrate was faced with a difficult task, but with respect, these final words show that he has not considered the real question. which is not whether rickshaws are contrary to the public interest-the Court is not trying the question whether the resolution passed by the Council is or is not justified—but whether a quasi-judicial body, a licensing authority, acted on insufficient grounds in refusing the grant of a licence to the appellant. It is perhaps unfortunate that the appeal took the form of a suit or even was allowed to continue as such, for no consideration was given to the by-laws nor to the duty and powers of the Council thereunder; and the decision of dismissal amounts to saying that an appellant can never show insufficient grounds for the refusal of an application for a licence if the Council have passed a resolution to the effect they will issue none at all. ٠,

The Council in passing resolutions is acting in one capacity, in issuing licences which it is empowered to grant it is acting or should act as a judicial body. Rex v. London County Council, ex parte Corrie (1918) 1 K. B. 68 is a similar case to the present appeal. The London County Council made a by-law relating to parks, etc., whereby the selling of any article without the consent of the Council was an offence. After granting permission to sell literature at meetingsin certain parks, they passed a resolution that the existing permissions should<br>be determined and no new permissions should be granted thenceforth. Acting on this resolution they refused an application by a certain society for permission to sell pamphlets at its meetings in one of the parks. The Parks Committee of the London County Council had reported to the Council that "after giving the

matter full consideration we have come to the conclusion that in the public interest it is desirable that the issue of permits should be discontinued". The report was approved and became a resolution of Council. But it was held by a Divisional Court consisting of Darling, Avory and Sankey, J., that there was vested in the London County Council by virtue of the by-law a discretion similar to that of the justices at licensing sessions and that they did not properly exercise that discretion by passing a resolution to grant no permission and acting on that resolution.

In Rex v. Barry District Council, ex parte Jones, 16 T. L. R. 565, the Council, which had power to issue such number of hackney coach licences as it thought fit, had entered into an agreement with two bus proprietors "to licence no omnibuses, brakes or carriages or drivers except those belonging to or in the employ of" those proprietors. The agreement was found to be ultra vires and was cancelled, but the Council continued in fact to grant licences exclusively to these two proprietors. The Council accordingly were ordered to hear and determine the applications of the other owners on the ground that it had exercised no discretion in the matter.

Rex v. Sylvester, 31 L. J. (M. C.) 93, is a case of licensing justices passing a general resolution not to renew the licences of all innkeepers to sell excisable liquors unless such persons consent to take out an excise licence for the sale of spirits in addition to the licence for the sale of beer. Wightman, J., in giving judgment said: "We are not at all denying that a discretion is vested in the Justices; but we think that in this case they have not exercised their discretion, and that they have acted in an unreasonable manner. They came to the meeting with a general resolution already prepared and I answer the question put to us by saying that they were wrong in the way in which they exercised the discretion given to them."

These cases establish the general principle that licensing authorities must act with judicial discretion. The Council in its capacity of a licensing authority cannot by general resolution prohibit a particular activity that can only lawfully be carried on with its licence. Each application has to be considered on its individual merits. Section 77, sub-sections (2) and (3) provides that the Council or a committee has to sit and hear the application for the licence. By-law 420 (e) is to the same effect. And Section 78 is in my opinion especially designed to give an inexpensive right of appeal from a refusal by the Council. In the English cases I have cited the appellants were bound to apply for a prerogative writ or for a statutory order by way of prerogative writ. The suggestion of Mr. Schermbrucker that the appeal should be dismissed and that the appellant be left to proceed by way of mandamus is therefore without foundation.

The Resident Magistrate was wrong in not going into the legal aspects of the matter and in considering such a general resolution showed an absence of insufficient grounds for refusal. He also misdirected himself in accepting the oral evidence as sufficient for holding that the Council had sufficient grounds for refusing the grant of licences as being contrary to the public interest. That evidence may justify the resolution but not the refusal of the licence. It would appear to me that a licence cannot be refused on the ground that the grant thereof is contrary to public interest merely because it is considered generally desirable to suppress rickshaws for that would be giving to the words "contrary to public interest" a very wide meaning and one having no relation to the context. In dealing with licensing I think that what is intended is some pecuniary interest either of the public as a whole or of some class of the public.

For these reasons I must allow the appeal and set aside the order of the Resident Magistrate and must order the Council to issue the licences applied for by the appellant. As there has been delay in bringing this matter to a conclusion these licences should run to 30th June, 1947. By that time no doubt effective steps will be taken to suppress rickshaws. The respondent will pay the appellant's costs both here and in the Court below. $\mathcal{L}^{\text{max}}_{\text{max}}(x)$