TyroCity: Administrative Law Notes

Administrative Law

Administrative Law Notes — Sun, 18 Aug 2013 05:41:42 +0000

Introduction

Development of Administrative Law

Classification of Administrative Power / Action

Delegated Legislation

Control of Delegated Legislation

Reasons and Type of Control

Administrative Discretion

Administrative Adjudication

Quasi Judicial Bodies

Quasi Judicial Bodies

Principles of Natural Justice

Ombudsman

Role of CIAA as an Ombudsman in Nepal

Public Undertaking

Public undertaking

Supreme Court's Role in Development of Administrative Law in Nepal

Development of Administrative Law

Administrative Law Notes — Sun, 18 Aug 2013 05:41:42 +0000

In General
Unlike other fields of law, administrative law is a recent phenomenon and can fairly be described as ‗infant.‘ Historically, its emergence could be dated back to the end of the 19th century. This era marked the advent of the welfare state‘ and the subsequent withering away of ‗the police state.‘ The interventionist role of the welfare state practically necessitated the increment of the nature and extent of power of governments. Simultaneous, with such necessity came the need for controlling the manner of exercise of power so as to ensure protection of individual rights, and generally legality and fairness in the administration. With such background, administrative law, as a legal instrument of controlling power, began to grow and develop too fast. Typically, with the proliferation of the administrative agencies, administrative law has shown significant changes in its nature, purpose and scope.

Presently, administrative law, in most legal systems, is significantly developed and undoubtedly recognized as a distinct branch of law. However the path followed to reach at this stage is not uniform and similar in most countries. Administrative law is unique to a specific country. Such uniqueness can be explained by the fact that it is the outcome of the political reality, economic circumstances and the nature of the legal system prevailing in that country. It is also highly influenced by the constitutional structure, the system of government and principles of the public administration adopted by that country.
Generally, the proliferation of the administrative agencies and the expansion of delegated legislation were two significant factors for the growth of the administrative law in most countries. The 20th century marked with the vast increase of administrative agencies with vast and wide-ranging powers. This necessitated legislative measures and judicial interference aimed at controlling the manner of exercise of power of these entities so as to ensure protection of individual rights and freedoms. As a result, most countries introduced specific and comprehensive rules and procedures governing administrative adjudication and rule-making. In US, the Administrative Procedure Act which was made law in 1946 is one such example of a comprehensive response to deal with the growing power of agencies. Since then, the landscape of the history of the American administrative law has been changed significantly. Similarly, in England the Statutory Instrument Act was promulgated in the same year (1946) even though it was not as comprehensive and influential as the American counterpart. The Act was a direct response to the ever increasing power of agencies, more specifically, the delegation power of agencies. In the 1920s fear developed about the volume and nature of the delegated legislation being produced, which was not receiving parliamentary scrutiny; many sought necessary or desirable.
In 1929, lord chief justice Lord Hewart published The New Despotism in which he railed against what he saw as dangerous and uncontrolled growth of bureaucratic power. In 1932, the report of the Donoughmore-Scott Committee on Ministers‘ powers was issued. The report, amongst other things, explained the inevitability of the delegated legislation, and also suggested some safeguards. The report also recommended better scrutiny of the vesting in Ministers of ‗oppressive‘ powers. This, finally, led to the enactment of the Statutory Instruments Act of the 1946.
However, the growth of the administrative law is not limited to statutory prescriptions of rules and procedures governing the administrative process. Courts have also played important roles in shaping the form, substance and scope of the administrative law. In England, until the Second World War and in the period immediately following 1945, courts continued limiting the scope of their controls. Such judicial restraint was relaxed after the 1960s and there was judicial revival and activism with the judiciary reclaiming their proper role of ensuring the legality and fairness of exercise of governmental powers. In America, where the judiciary has firmly asserted its strong position in checking the constitutionality of parliamentary legislation, the courts didn‘t hesitate to review administrative decision, including delegated legislation.
In France, Italy, Germany and in a number of other countries, there is a separate system of administrative courts which deal with administrative cases exclusively. As a natural consequence, administrative law has developed on its own independent lines, and is not enmeshed with ordinary private law as it is in the Anglo-American system.

Classification of Powers of Administrative Agencies

Administrative Law Notes — Sun, 18 Aug 2013 05:41:42 +0000

Administrative agencies, in order to realize their purpose efficiently and effectively, need wider power and discretion. For this reason, they blend together three powers of government: executive, legislative and judicial powers. Even though in principle the later two powers belong to the legislature and courts, granting such powers has become a compulsive necessity for an effective and efficient administration.
Administrative agency rules and regulations often have the force of law against individuals. This tendency has led many critics to charge that the creation of agencies circumvents the constitutional directive that laws are to be created by elected officials. According to these critics, administrative agencies constitute an unconstitutional, another bureaucratic branch of government with powers that exceed those of the three recognized branches (the legislative, executive, and judiciary). In response, supporters of administrative agencies note that agencies should be created and overseen by elected officials, or the president. Agencies are created by an enabling statute; a state or federal law gives birth to agency and outlines the procedures for the agency’s rule-making. Furthermore, agencies include the public in their rule-making processes. Thus, by proxy, agencies are the will of the electorate.
Supporters of administrative agencies also note that agencies are able to adjudicate relatively minor or exceedingly complex disputes more quickly or more flexibly than the state and federal courts, which helps to preserve judicial resources and promotes swift resolutions. Opponents argue that swiftness and ease at the expense of fairness are not virtues, the thrive of the administrative agencies.

Reasons for the Growth of Administrative agencies/ Administrative Adjudication

Administrative Law Notes — Sun, 18 Aug 2013 05:41:42 +0000

Agencies are created and assigned specific tasks by the legislature. They carry out the tasks making decisions of various sorts and supervising the procedure by which the decisions are carried out. There are many reasons why administrative agencies might be needed. Almost every governmental agency has been created because of a recognized problem in society, and from the belief that an agency may be able to help in solving the problems. The following are the main reasons for the creation of the administrative agencies.

A. Providing Specificity
The legislative branch of government cannot legislate in sufficient detail to cover all aspects of many problems. The house of the people‘s representatives cannot possibly legislate in minute detail and, as a consequence, it uses more and more general language in stating its regulatory aims and purposes. For instance, the house of people‘s representatives cannot enact a tax law that covers every possible issue that might arise. Therefore, it delegates to the council of ministers and ministry of revenue the power to make rules and regulations to fill in the gaps, and create the necessary detail to make tax laws workable. In many areas, the agency has to develop detailed rules and regulations to carryout the legislative policy.
It is also true that courts could not handle all disputes and controversies that may arise. They simply do not have the time or the personnel to handle the multitude of cases. For instance, the labour relations board entertains and resolves so many number of collective labour disputes between employees and employers. Similarly, the tax appeal commission and the welfare (pension) appeal tribunal adjudicate and decide vast number of administrative litigations within their jurisdiction. The creation of such adjudicatory agencies (usually known as quasi- administrative agencies) is necessary, because of the fact that they have, specialized knowledge and expertise to deal effectively with the detailed, specific and technical matters, which are normally beyond the competency of judges of ordinary courts.

B. Providing Protection
Many government agencies exist to protect the public, especially from the business community. Business has often failed to regulate itself, and the lack of self- regulation has often been contrary to the public interest. For instance, the Environmental Protection Agency is created to regulate environmental pollution. In the absence of such agency, business could not voluntarily refrain from polluting the environment. The same can be said with respect to quality of private higher education and unjustified and unreasonable increase in the price of essential goods. The Ministry of Education and Ministry of Trade and Industry, regulate respectively both of these cases to protect consumers and the public at large.

C. Providing Services
Many agencies are created simply out of necessity. If we are to have roads, the Nepal Roads Authority is necessary. Welfare programs require government personnel to administer them. Social security programs necessitate that there should be a federal agency to determine eligibility and pay benefits. The Nepal Social Security Authority is established to process pension payment and to determine entitlement to such benefit. The mere existence of most government programs automatically creates new agencies or expands the function of the existing ones.

The following may be summarized as purposes of the administrative agencies.

A) Regulation
One of the key reasons for regulating economic activities by the government is the inability of business to regulate itself. When the government decides to regulate a certain sector, it entrusts the task to the administrative agencies. Agencies offer several advantages over regulation through the legislature and courts in the management of complex and technical regulatory problems. Because they are specialized bodies, they can consider technical details more effectively than the legislature.
When the government regulates business its aim is to minimize the negative impacts of a free economy. In the absence of regulation, business does not respond to concerns over the environment and consumers. Some of the justifications for regulation include:

To control monopoly power
Agencies are often created to replace competition with regulation. In this case the agency may determine rate (e.g. transportation, or electricity). Sometimes the difference in bargaining power may be a ground for regulation, avoiding monopoly power of one party. Such instances include regulation of banking, insurance and labour relations.

To control excess profit
The agency regulates business to ensure that business is not collecting excess profit, which may endanger the laws of free market and also may pose a danger to consumers.

To compensate for externalities
―Externalities‖ occasionally referred to as ―spillovers‖, that occur when the cost of producing something does not reflect the true cost to society for producing the goods. One example is manufacturing process that creates air pollution for which society pays the clean up costs. A business organization, unless otherwise it becomes sure that there is also corresponding participation by other companies, will not install costly pollution control equipment. Doing so will drive up that company‘s costs which makes it unable to compete with other companies in producing the same product without equipment and selling their products at a lower price. So, some entity i.e. a government agency must require all companies to make those investments (installing equipments) in order to spread the costs of pollution control over the entire industry..

To compensate for inadequate information
Compensating for inadequate information is a justification for a great deal of legislation for consumer protection. Purchasers of food, for instance, cannot analyze the nutritional content or the health hazards of various food products so that there has to be some organ that ensures these tests are fulfilled.

To compensate for unequal bargaining of powers
Contracts between banks & customers, insurers & the insured, employees & employers are adhesive in their nature. Either the consumer has to take it or leave it. Hence, it becomes self-evident to regulate and set minimum standards to minimize the effect of unequal bargaining of power.

B) Government exactions
In addition to regulation, administrative agencies may also engage in government exactions. Government exactions are the traditional powers and responsibilities of agencies. Such functions include collection of tax and military conscription.

C) Disbursement of money or other commodities
This purpose of administrative agencies is also the prominent one which characterizes the welfare state. In this regard, through the social security programme and other government systems of insurance or compensation, agencies disburse public money as payment of pensions for veterans or assistance for the aged, the disabled, the unemployed and generally the needy. The payments may be directly through cash or food rations.

D) Provision of goods and services
Nowadays, the government is in charge of building and maintaining roads, high ways and dams, the provision of police force and other protective services. Funding public education and the health service may also be mentioned as additional examples. More recent additions include mass transit communications, satellite systems, government research and development programmes, public hospitals and public housing.

Other Reasons

i) Intensive form of government; welfare state

(ii) Informal, cheap and quick vs. expensive, time-consuming litigation in court

(iii) Expertise, specialization and experimentation needed to develop and apply new public law standards

(iv) Growing emphasis on preventive justice rather than punitive justice

(vi) To reach decisions not strictly according to law as such, but on the ground of policy considerations and mutual give and take

(vii) Courts are groaning under the weight of pending cases and if the whole mass of fresh litigation arising in an intensive form of government is diverted to them, the judicial system would virtually collapse

Administrative Discretion

Administrative Law Notes — Sun, 18 Aug 2013 05:41:42 +0000

Discretionary powers are permissive, not mandatory. They are powers granted either under statute or delegation which do not impose a duty on the decision-maker to exercise them or to exercise them in a particular way. Within certain constraints, decision-makers are able to choose whether and/or how to exercise discretionary powers.

No public official has an unfettered discretionary power. Public officials must exercise discretionary powers in accordance with any applicable legal requirements, reasonably, impartially and avoiding oppression or unnecessary injury.

Agencies should adopt policies and procedures which set out the general approach to be followed in at least each major area of activity for which they are responsible. This should ensure that the agency’s powers are exercised consistently from case to case, unless the merits of any particular case justify a different approach.

Administrative decisions often include the exercise of discretion. Discretion exists when the decision-maker has the power to make a choice about whether to act or not act, to approve or not approve, or to approve with conditions. The role of the decision-maker is to make a judgement taking into account all relevant information.

Powers to act and to exercise discretion

For public sector decision-making, legislation generally provides the lawful authority for action to be taken and for decisions to be made. Public sector decision-making may be undertaken:

As part of fulfilling responsibilities to ensure the efficient and effective management and performance of a public authority, eg, under the general public sector legislation; or
As part of taking action or making decisions under agency or department-specific legislation relating to the services delivered by the public authority.

Relevant administrative law principles

In exercising discretionary powers, various principles of administrative law require public officials to:

use discretionary powers in good faith and for a proper purpose (ie, honestly and only within the scope of and for the purpose for which the power was given)
base their decision on logically probative material (ie, logical reasons, information that proves the issues in question, relevant and reliable evidence)
consider only relevant considerations and not consider irrelevant considerations
give adequate weight to a matter of great importance but not give excessive weight to a relevant factor of no great importance
exercise their discretion independently and not act under the dictation or at the behest of any third person or body
give proper, genuine and realistic consideration to the merits of the particular case, and not apply policy inflexibly, and
observe the basic rules of procedural fairness (ie, natural justice).

Other principles of administrative law preclude public officials from:

making decisions in matters in which they have an actual or reasonably perceived conflict of interests
Improperly fettering their own discretion (or that of future decision-makers) by, for example, adopting a policy that prescribes decision-making in certain circumstances
exercising a discretion in a way that is so unreasonable that no reasonable person would have exercised the power in that way
exercising a discretionary power in such a way that the result is uncertain
acting in a way that is biased or conveys a reasonable perception of bias
making decisions that are arbitrary, vague or fanciful
refusing to exercise a discretionary power in circumstances where the decision-maker is under a duty to do so, or
unreasonably delaying the making of a decision that the decision-maker is under a duty to make.

It is a serious matter for public officials to ignore valid advice or valid considerations, particularly for the purposes of avoiding discomfort or embarrassment on the part of the government, agency or decision-maker.

Policies and practices to guide the exercise of discretionary power

Not every situation demands a policy, and policies are not a panacea capable of properly addressing all circumstances. However, policies are an important means of guiding decision-makers in exercising discretionary powers appropriately, consistently and fairly.

Policies should include an objective and the criteria to be used in decision-making to help ensure that:

all relevant legal requirements are complied with
all relevant factors are considered
there is consistency in decision-making, and
the decision-making process is transparent and accountable.

As a matter of principle, it is unacceptable for an agency to adopt and implement a policy that adversely affects, or could adversely affect, the rights or interests of any member of the public where the existence or content of the policy is kept secret or the policy document is not available for inspection and purchase on request.

Policies adopted by agencies should be communicated to relevant staff and members of the public. In this regard, s.15 of the Freedom of Information Act requires that agencies must ensure each of their policy documents are available for inspection and purchase by members of the public.

Judicial (Decision – Making) Power

Administrative Law Notes — Sun, 18 Aug 2013 05:41:42 +0000

Efficient and effective administration also requires that those entities in charge of implementing the law be armored with judicial power, to some extent, similar to the power of the ordinary courts. Enforcement of law demands imposition of sanction and taking administrative measures and decisions. When agencies exercise their judicial powers, they are in effect applying the facts to the law just like a court. Consequently, they determine rights, entitlements and benefits of individuals. The decisions may greatly affect individual‘s rights and benefits, for example, revocation of license, deportation of aliens, determining whether an applicant is entitled to pension, imposition of administrative fines for non- compliance, dismissal of a civil servant, dismissal of a university student, etc … are judicial decisions that by nature that affect the rights of individuals.
When an agency exercises its judicial function it is engaged in adjudication, a process very much similar to a trial court. While adjudicating a case, it will conduct an oral hearing with direct and cross-examination, administers oath, decides on the admissibility of evidence and may compel an individual or a company to produce evidence. Then by weighing evidence of the applicant and respondent applies and interpreters the law to give a reasoned decision. To ensure impartiality and fairness the person deciding the matter should be relatively neutral from agency influence.

Still there is likelihood that agencies may abuse their decision- making power. As a result, the lawmaker, while granting such powers, is expected to provide minimum procedures applicable in the adjudication process.

Sub Delegation

Administrative Law Notes — Sun, 18 Aug 2013 05:41:42 +0000

When the rule-making authority delegates to itself or to some other subordinate authority a further power to issue rules, such exercise of rule-making power is known as sub-delegated legislation.

Rule-making authority cannot delegate power unless such power of delegation is contained in the enabling act. Such authorization may be either express or by necessary implication.

Maxim ‘delegatus non potest delegare’ indicates that sub-delegation of power is normally not allowable, though the legislature can always provide for it.

If the authority further delegates its law-making power to some other authority and retains a general control of a substantial nature over it, there is no delegation as to attract the doctrine of ‘delegatus non potest delegare.’

The maxim was originally invoked in the context of delegation of judicial powers and implied that in the entire process of adjudication, a judge must act personally except in so far as he is expressly absolved from his duty by a statute.

Sub-delegation in very wide language is improper and some safeguard must be provided before the delegate is allowed to sub-delegate his power.

Administrative Power

Administrative Law Notes — Sun, 18 Aug 2013 05:41:42 +0000

Administrative power is the residual power that is neither legislative nor judicial. It is concerned with the treatment of a particular situation and is devoid of generality. It has no procedural obligations of collecting evidence and weighing argument. It is based on subjective satisfaction where decision is based on policy and expediency. It does not decide on a right though it may affect a right. Advisory and investigative power of agencies may be mentioned as two typical examples of administrative power. In its advisory function, an agency may submit a report to the president or the head of executive and the legislature. Cases falling under advisory function include proposing a new legislation to the legislature, and informing the public prosecutor the need to take measure when there is violation of law. Disclosing information to the general public that should be known in the public interest and publishing advisory opinions are also regarded as advisory (administrative) functions.

Investigation is one of the major functions of administrative agencies. While exercising their investigative powers, agencies investigate activities and practices that may be illegal. Because of this investigative power, agencies can gather and compile information concerning the organization and business practices of any corporation or industry engaged in commerce to determine whether there has been a violation of any law. In exercising their investigative functions, agencies may use the subpoena power. A subpeona is a legal instrument that directs the person receiving it to appear at a specified time and place either to testify or to produce document require reports, examine witnesses under oath, examine and copy documents, or obtain information from other governmental offices. This power of investigation complements the exercise of the agency‘s powers, especially the power to adjudicate.

Public undertaking

Administrative Law Notes — Sun, 18 Aug 2013 05:41:42 +0000

Public undertaking. An undertaking over which the public authorities directly or indirectly exercise dominant influence by virtue of their ownership, financial participation, or the rules which govern it.

Public Sector Undertaking, known as PSU, is a company in which majority of the stake (more than 50%) is owned by the Government.

An undertaking over which the public authorities directly or indirectly exercise dominant influence by virtue of their ownership, financial participation, or the rules which govern it. A dominant influence of public authorities is in particular presumed when they: a) hold the major part of the undertaking’s subscribed capital, b) control the majority of the votes attached to shares issued by the undertaking or c) are in a position to appoint more than half of the members of the undertaking’s administrative, managerial or supervisory body.

Scope and Classification of Delegated Legislation

Administrative Law Notes — Sun, 18 Aug 2013 05:41:42 +0000

It is accepted at all hands that a rigid application of the doctrine of non delegability of powers or separation of powers is neither desirable nor feasible in view of the new demand on the executive. The new role of the welfare state can be fulfilled only through the use of greater power in the hands of the government, which is most suited to carry out social and economic tasks. The task of enhancing the power of the government to enable it to deal with the problems of social and economic reconstruction can be effectively and efficiently accomplished through the technique of delegation of legislative power to it. Thus it can be clearly observed that pragmatic considerations have prevailed over theoretical objections.
Therefore, the position has been shifted from one of total objection to the issue of the permissible limits of valid delegation. Legislative delegation raises the issue of delegable and non-delegable legislative powers. There is no agreed formula with reference to which one can decide the permissible limits of delegation. However, as a rule, it can be said that the legislature cannot delegate its general legislative power and matters dealing with policy.
The legislature after formulating the fundamental laws can delegate to administrative agencies the authority to fill in gaps which is an authority necessary to carry out their purposes. The matters which are appropriate for delegation are such matters as procedures for the implementation of the substantive provisions contained in the principal legislation. This indicates that only the subsidiary part of the legislation could be delegated to administrative agencies so as to enable them to fill any available gaps;i.e. the legislative body ought to state an intelligible principle and that the executive branch would merely fill in the details. Subordinate legislation can cover only subject matters delegated expressly in the principal legislation.

Delegation of some part of legislative powers has become a compulsive necessity due to the complexities of modern legislation.
Essential legislative functions cannot be delegated by the legislature.
After the legislature has exercised its essential legislative functions, it can delegate non-essentials, however, numerous and significant they may be.
The delegated legislation must be consistent with the parent act and must not violate legislative policy and guidelines. Delegatee cannot have more legislative powers than that of the delegator.

Definition

When an instrument of a legislative nature is made by an authority in exercise of power delegated or conferred by the legislature, it is called subordinate legislation or delegated legislation. Halsbury’s Laws of England, 4th ed.

Delegated legislation is that which proceeds from any authority other than the sovereign power, and is, therefore, dependent for its continued existence and validity on some superior or supreme authority. Salmond.

Scope
Delegated legislation must not:

(i) exceed the parent/enabling Act made by the legislature

(ii) conflict with the enabling Act, and

(iii) alter the necessity, special features, make or polices of the Act.

Forms

Title based classification
Discretion based classification
Purpose based classification
Authority based classification
Nature based classification

Title based classification
(i) Rule– A rule made under any Act, and includes regulation made similar to a rule under any Act . – Nepal Law Interpretation Act, 2010.

The law or rule made by the executive or other concerned authority in exercise of power conferred by the legislature in an Act for fulfillment of the objectives of the Act.

(ii) Regulation– The term relates to a situation where power is given to fix the date for the enforcement of an Act or to grant exemptions from the Act or to fix prices, etc. (more of substantive nature).

(iii) By-law– Regulations, ordinances, rules or laws adopted by an association or corporation or the like for its internal governance. By laws define the rights and obligations of various officers, persons or groups within the corporate structure and provides rules for routine matters such as calling meetings and the like.- Black’s Law Dictionary.

(iv) Order– This term is used to cover various forms of legislative and quasi-judicial decisions. Orders may be specific or general. The former refers to administrative action while the latter refers to administrative rule-making.

(v) Direction-It is an expression of administrative rule-making under the authority of law or rules or orders made thereunder. These may be recommendatory or mandatory. If mandatory, these have the force of law.

(vi) Scheme: The term refers to a situation where the law authorizes an administrative agency to lay down a framework within which the detailed administrative action is to proceed.

Discretion based classification
(i) Contingent or conditional legislation

A statute that provides control but specifies that they are to go into effect only when a given administrative authority finds the existence of conditions defined in the statute itself. It is fact-finding, not discretionary.

Such as,

future applicability left to the subjective satisfaction of the delegate as to indicating the proper time
Act enforced but power to withdraw the same from operation delegated to satisfaction of the delegate.
Power exercisable upon the delegate’s satisfaction of objective facts by a class of people seeking benefit of the exercise of such power to deprive the rival class of persons of statutory benefits.

Last category of conditional legislation attracts the principles of natural justice.

Though delegated legislation as such does not attract the principles of natural justice, but it applies in the case of conditional legislation where a person is deprived of his statutory rights.

Contingent legislation classification is linked with the case of Field v. Clark (US, 1892)

(ii) Subordinate legislation

The process consists of the discretionary elaboration of rules and regulations.

The distinction is one of discretion. ‘It may be noted that this distinction is hardly real. In contingent legislation also, a certain amount of discretion is always present. The contingent legislation formula is a fiction developed by the U.S. Supreme Court to get away from the operation of separation of powers.

Whereas conditional legislation contains no element of delegation of legislative power and is, therefore, not open to attack on the ground of excessive delegation, delegated legislation does confer some legislative power on some outside authority and is, therefore, open to attack on the ground of excessive delegation.

Purpose based classification
On the basis of different purposes it is made to serve.

(i) Enabling Act: such Acts contain an ‘appointed day’ clause under which the power is delegated to the executive to appoint a day for the Act to come into operation.

(ii) Extension and Application of Act: extension and application of Act in respect of a territory or for a duration of time or for any other such object.

(iii) Dispensing and Suspending Acts: power is delegated to the administrative authority to make exemptions from all or any provision of the Act in a particular case or class of cases or territory, when at the discretion of the authority, circumstances warrant it.

(iv) Alteration Acts: Alteration is a broad term and includes both modification and amendment.

The power of modification is limited to consequential changes, but if overstepped it suffers challenge on the ground that it is not within the legislative intent of modification.

Sometimes includes the power to remove difficulties so that the various statutes may coexist.

Amendment- e.g. power to change the schedule of an Act.

(v) Taxing Act: The policy of the taxing statute must be clearly laid down by the legislature.

(vi) Supplementary Acts: Power is delegated to the authority to make rules to carry out the purposes of the Act.

(vii) Approving and Sanctioning Acts: Power is delegated not to make rules, but to approve the rules framed by another specified authority.

(viii) Classifying and Fixing Standard Acts: Power is given to administrative authority to fix standard of purity, quality or fitness for human consumption. Courts have upheld on grounds of necessity.

(ix) Penalty for Violation of Acts: Power may be delegated to administrative authority to prescribe punishment for violation of rules.

(x) Clarify the provisions of the statute’ Act: Power is delegated to the administrative authority to issue interpretation on various provisions of the enabling Act.

Authority based classification
Based on the position of the authority making the rules.

Sub-delegated legislation: When the rule-making authority delegates to itself or to some other subordinate authority a further power to issue rules, such exercise of rule-making power is known as sub-delegated legislation.

Rule-making authority cannot delegate power unless such power of delegation is contained in the enabling act. Such authorization may be either express or by necessary implication.

Maxim ‘delegatus non potest delegare’ indicates that sub-delegation of power is normally not allowable, though the legislature can always provide for it.

Sub-delegation in very wide language is improper and some safeguard must be provided before the delegate is allowed to sub-delegate his power.

Nature-based classification
On the basis of nature and extent of delegation

(i) Normal delegation

(a) Positive- where the limits of delegation are clearly defined in the enabling Act.

(b) Negative- where power delegated does not include power to do certain things, i.e., legislate on matters of policy.

(ii) Exceptional delegation

Instances of exceptional delegation may be:

power to legislate on matters of principle
power to amend Acts of Parliament
power conferring wide discretion that is almost impossible to know the limits
power to make rules without being challenged in a court of law

Audi alteram partem

Administrative Law Notes — Sun, 18 Aug 2013 05:41:42 +0000

Audi Alteram Partem (Right to Hearing)

As lord Denning “if the right to be heard is to be a real right which is worth anything if must carry with it a right in the acussed man to know the case which is made against him.” The development of audi alteram partem principle has like many other legal concepts been eclectic. An early group of cases was concerned with deprivation of offices requiring notice and a hearing prior to deprivation. Another somewhat later group involved in the clergy penalties or disciplinary measures to which the clergy were subjected had to be preceded by notice and a hearing. In 19th century the audi alteram partem principle was applied to wide variety of bodies’ private as well as public clubs, associations and trade unions were included within its ambit. The increase in the regularity role of public authorities provided further opportunity for the generalized application of maxim. Thus in cooper v wandsworth board of works it was held that the demolition powers vested in the defendant Board were to be subject to notice and hearing requirements. The generality of application of audi alteram partem maxim and its flexibility in operation were brought out by Lord Loreburn L.C who stated that the maxim applied to everyone who decides anything while recognizing also that the manner in which a person’s case was heard did not necessarily have to be the same as an ordinary trial.

To be a fair hearing an assumption is made that there must be three rights:

Sufficient notice is given to allow the case to be adequately prepared
That at any hearing a person will be entitled to know what evidence has been produced against him or her.
There must be proper opportunity to contest correct or contradict any such evidence to sates one’s case and raise any relevant matters before the tribunal.
to an opportunity to reply in a way that is appropriate for the circumstances
for his/her reply to be received and considered before the decision is made
to receive all relevant information before preparing his/her reply
to a reasonable chance to consider their position and prepare a response. However, what is reasonable can vary according to the complexity of the issue, whether an urgent decision is essential or any other relevant matter, and
to genuine consideration of any submission. The Delegate needs to be fully aware of everything written or said by the clearance subject, and give proper and genuine consideration to his/her case.

In addition a fair hearing may also include being provided with legal representation, the right to cross examination, witness or reasons for a decision.

It means, Hear the other side, or both the sides, It is the first principle of the civilized jurisprudence that a person, against whom any action is sought to be taken or whose right or interest beinf affected should be given a reasonable opportunity to defend himself hearing, means a fair hearing.

This is basic requisition of rule of law; it has been described as fundamental and foundation concept. The situations of cases of different nature, as the norms of fair hearing can vary from body to body and cases to case there is no rigid formula or invariable standard to deal with the concept of fair herring like tight to notice , right to present case and evidence, right to rebut evidence through cross examination and legal representation or right o council, reasoned decision , specking order, institutionalized or one who decides must hear , rule against dictation, financial incapacity to attend the inquiry officers report etc, these decision principles as not embodied rules contemplated in a single frame work nor are they flexible in number with certain limitation . Components of fair hearing are

Notice–before any action is taken, the effected party must be given a notice to show cause against the proposed action and seek his explanation ,it is a sine qua non of the right of fair hearing and any passed with out giving notice is against the principle of nature justice is void in ab initio.

Hearing- A basic principle of the natural justice is that before of the adjudication starts the authority concerned should of the cases against him and the action purposed to be taken against him so that he may accurately defendant, notice is the first and extremely important step in haring procedure, any proceeding taken without notice would violate natural justice and would be invalid.

The doctrine of ‘audi alteram partem’ is the basic notion of the principle of natural justice. The doctrine says that no one should be condemned unheard. In the field of administrative decisions, this principle has been applied to unsure fair play and justice to affected persons.

The right to a fair hearing requires that individuals are not penalized by decisions affecting their rights or legitimate expectations unless they have been given prior notice of the cases against them, a fair opportunity to answer them, and the opportunity to present their own cases.

Administrative agencies are not bound by the technical rules of procedure of law courts; this accentuates the need to follow the minimum procedure of fair hearing.

(i) Right to Notice

Notice=information=knowledge

Notice embodies rule of fairness, and must precede an adverse order. Adequate time must be given to respond. If requirement of notice is a statutory requirement, then notice must be given in a manner provided by law.

Notice is the starting point of any hearing. Unless a person knows the formulation of subjects and issues involved in the case, he cannot defend himself. Notice must also be adequate, which generally means it must state: (i) time, place and nature of hearing, (ii) legal authority under which the hearing is to be held, and (iii) specific charges which the person has to meet.

Gajendra Bahadur v. District Land Reform Office Kathmandu (NKP 2050, p. 671)- Decision cannot be taken in the absence of the concerned party, by merely publishing notice in a newspaper, without duly serving notice pursuant to the law.

(ii) Right to know evidence against him

Every person before an administrative authority exercising adjudicatory powers has the right to know the evidence to be used against him.

Nothing should be used against the person, which has not been brought to his notice.

(iii) Right to present case and evidence

The adjudicatory authority should afford reasonable opportunity to the party to present his case. This can be done orally or through writing.

Nyuchhemaya Tuladhar v. Rupandehi Dist. Court (NKP 2050, p.231)- Where proceedings required inclusion of registered persons other than the borrower, and the auction notice which was published did not include such registered persons, therefore, the proceeding requiring such registered persons to make payment without the opportunity to be heard is against the principle of natural justice. SC order Rupandehi and Ktm dist courts to issue notices to the registered persons.

(iv) Right to rebut adverse evidence
It is not enough that the party should know the adverse material on file but it is further necessary that he must have an opportunity to rebut the evidence. Rebuttal can be done either orally or in writing.

The opportunity to rebut evidence necessarily involves the consideration of two factors: cross-examination and legal representation.

Cross-examination: Courts do not insist on cross examination in administrative adjudication, unless the circumstances are such that in the absence of it a person cannot put up an effective defence.

Legal Representation- A fair hearing in administrative proceeding will not necessarily include the right to legal representation. Representation will, however, normally be permitted.

(v) No evidence should be taken at the back of the other party

Whatever information (evidence) is obtained by the administrative authority must be disclosed to the other part, and an opportunity to rebut it must be provided.

(vi) Report of enquiry to be shown to the other party

In very many cases, especially in disciplinary matters, it happens that the inquiry is entrusted to someone else and on the report being submitted, action is taken by the competent authority.

A copy of the report of the inquiry officer should be supplied to the affected party before the authority takes a decision on the guilt and the consequential punishment on the basis of the report of the inquiry officer.

(vii) Reasoned Decision or Speaking Orders

Kalar Thakur Hajam v. District Land Reform Office Saptari (NKP 2043, p.304)-

An official with authority to take a judicial or quasi-judicial decision, while deciding, must consider evidence and decide by giving reasons for the decision.

Use of judicial conscience – The SC of Nepal at times uses the term ‘judicial conscience’, similar in meaning to reasoned decision.

(viii) One who must hear must decide, or Institutional Decision

The term institutional decision is popular in American law.

Unlike law courts, the decision in many administrative proceedings is not the decision of one man from start to finish. Often one person hears and another decides. The divided responsibility may work contrary to the concept of fair hearing.

Whatever may be the merit of this rule, the fact remains that in view of the complexity of modern administration, a literal application of this rule will bring the wheels of administration to a grinding halt. Thus, the person or authority charged with the responsibility of taking a decision may take help from subordinates, but be must be personally consider and appraise the evidence and independently come to a decision.

(ix) Rule against dictation

Any administrative authority invested with the power of decision-making must exercise this power in exercise of its own judgment. If a decision is taken at the direction of any outside agency, there is violation of fair hearing.

(x) Decision post-haste

Fundamentals of fair hearing demand that the administrative authority must not rush decision. It may compromise procedures related to fair hearing.

Exceptions to the Rule of Natural Justice (situations when these rules do not apply)

(i) Emergency

In cases of emergency where prompt action, preventive or remedial, is needed, the requirement for notice and hearing may be removed.

(ii) Confidentiality

Eg., access to police surveillance register

(iii) Purely administrative matters

In Nepal,

The principles of natural justice apply to only judicial and quasi-judicial decisions. The discretion of HMG to grant approval for prosecution of corruption related allegations is a purely administrative function and not a quasi-judicial function, and hence, the principle of natural justice do not apply to it. – Mukti Sharma v. Tek Bahadur (NKP 2017, p.101).

The rule was reinforced in the case of Yagyamurti Banjade v. Durga Das Shrestha (NKP 2027, p.157), where the court expressed the difference between judicial, quasi-judicial and purely administrative, and held that the rule of natural justice must be adopted in quasi-judicial decisions, not in purely administrative decisions.

(iv) Based on Impracticability

If it is administratively impracticable to ensure fair hearing to all (usually very larger numbers) of affected persons.

(v) Interim preventive action

If the action of the administrative authority is a suspension order in the nature of a preventive action and not a final order, the application of the principles of natural justice may be excluded.

(vi) Legislative action

Legislative action, plenary or subordinate, is not subject to the rules of natural justice because these legislation lay down a policy without reference to a particular individual.

(vii) Where no right of the person is infringed

Where no right has been conferred on a person by any law, the principles of natural justice are not applicable.

(viii) Statutory Exception or Necessity

Disqualification on the ground of bias against a person will not be applicable if he is the only person competent or authorized to decide that matter or take that action.

(ix) Contractual Arrangement

Termination of an arrangement/agreement is neither a quasi-judicial act, so the duty to act judicially is not attracted.

(x) Government Policy Decision

If in exercise of executive powers the government takes any policy decision, principles of natural justice can be excluded because it will be impossible and impracticable to give formal hearing to all those who may be affected whenever a policy decision is taken and at times it will be against the public interest to do so.

(xi) Useless formality theory

Where on the admitted or undisputed facts only one conclusion is possible and under the law only one penalty is permissible, the Court may not insist on the observance of the principles of natural justice.

(xii) Disciplinary Action

In public or govt. services, especially army and police, to enforce discipline

But usually not total exclusion of natural justice rules.

Exception to The Rule of Natural Justice

Administrative Law Notes — Sun, 18 Aug 2013 05:41:42 +0000

Exclusion of Natural Justice-:

Though the rule of natural justice namely, nemo judex in causa sua and audi alteram partem, have now a definite meaning and connotation in law, and their content and implications are well understood and firmly established, they are nonetheless not statutory rules. Each of these rule yields to and changes with the exigencies of different situations. They do not apply in the same manner to situations which are alike. These rules are not cast in a rigid mould nor they be put in al legal strait-jacket. They are not immutable but flexible. These rules can be adopted and modified but statues and statutory rules and also by the constitution of the tribunal which has to decide a particular matter and the rules by which such tribunal is governed.[1] There are exceptional situation which exercised this types of practice informed the administration tribunals and so many laws are overtake the natural justice may be excluded-:

1. Statutory exclusion
The principles of natural justice do not suppliant the law but supplements it. It follows where the statute is silent about the compliance with the principles of natural justice; such statutory silence is taken to imply observance of the principles of natural justice. However, where a statue excluded the application of any or all the rules of natural justice than court cannot ignored statutory mandate and read in to the concerned provision the requirement natural justice.[2]

2. Exclusion in cases of legislative function
Legislative action, plenary or subordinate, is not subject to the rules of natural justice. This is so because these rules lay down a policy without reference to particular individual especially it was applied disciplinary action which is exercised the rights to maintained peace and security and privacy. Legislative action, for example, price fixing, is a direction of general character, not directed against a particular person or individual manufacturer or trader. There is no question invoking principles of natural justice in such cases.[3]

3. Exclusion in Emergency
In exceptional cases of emergency where prompt and preventive action is required, the principles of natural justice need not to be observed. According to Justice krshna Iyer ….. ‘If to condemn unheard is wrong, it is wrong except where it is overborne by dire social necessity’.[4] Thus, where dangerous building is required to be demolished to save human lives.

However, ‘immediacy’ does not exclude duty to act fairly because even an emergent situation can co-exist with the canons of natural justice. Thus, even in the case of emergency here precious rights of the people are affected; post-decisional hearing has relevance to administrative fairness.

Public interest
There requirement of notice and hearing may be excluded where prompt actions to be taken in the interest of public safety, public health or public morality. In case of pulling down property to extinguish fire, destruction of contiguous plant is animal like destruction of unwholesome food etc. action has to be taken without giving the opportunity of hearing. Nevertheless, hearing may be given in some of this situation after the action has been taken as a corrective measure to see whether mistake has been committed.

Exclusion based on impracticability
Judicial approach in applying the rules of natural justice to fact situations is not theoretical but pragmatic. Where the number of persons is so large that is not practicable to give all of them the opportunity to being heard, the court does not insist an observance of the principle of natural justice. The entire MBA entrance examination was canceled the university because of mass copying, the court held that notice and hearing to all the candidates is not practicable in such situation.[5]

Exclusion based on the Academic evaluation
Where a student is removed from an educational institution on grounds of unsatisfactory academic performance, the requirement of pre decisional hearing is excluded. Thus, a student of the university was removed from the rolls because of unsatisfactory academic performance without giving any hearing.[6]

Exclusion in case of interim disciplinary action
Where disciplinary action is preventive in nature, the observance of the rules of natural justice is excluded. Thus in

Abhay kumar v. K. Srinivasan[7] case the Delhi high court ruled that such an order could be compared with an order of suspension pending enquiry which is preventive in character in order to maintain peace in the campus, and therefore the principles of natural justice not attracted.

Contractual transaction
In state of Gujrat v. M.P. shah Charitable trust[8] the Supreme Court held that the principles of natural justice are not attracted in case of termination of an agreement in any contractual field. The reason is clear that termination of an arrangement is neither a quasi judicial nor an administrative act. Hence, the question of duty to act judicially does not arise.

[1] C.K. Thakker, Administrative Law,(Eastern Books Company, 1996), 207

[2] Union of India v. J.N sinha AIR 1971, SC 40

[3] Union of India v. Cynamide India AIR 1987, SC 1802

[4] Mohinder Singh Gill v. Chief election commissioner, AIR 1978 SC 851

[5] R. Raadha Krishnaman V. Osmania University, AIR 1974Ap 283

[6] Jawar lal Nehru Universityv. B.S. Narwal, AIR 1981 DEL 381

[7] AIR 1981 Del 381

8 3 SCC 552