Cable & Wireless (CI) Ltd v ICT Auth

• Jurisdiction: Cayman Islands
• Judge: (Smellie, C.J.)
• Judgment Date: 18 July 2007
• Court: Grand Court (Cayman Islands)
• Date: 18 July 2007

Grand Court

(Smellie, C.J.)

CABLE & WIRELESS (CAYMAN ISLANDS) LIMITED

and

INFORMATION AND COMMUNICATIONS TECHNOLOGY AUTHORITY

H.G. Robinson and M. Ram for the plaintiff;

G. Ritchie, Q.C. and D. Collier for the respondent;

N. Pleming, Q.C. and Mrs. L. DaCosta for Digicel Cayman Ltd., an interested party.

Cases cited:

(1) Bank Mellat v. Nikpour, [1982] Com. L.R. 158; [1985] FSR 87, followed.

(2) Behbehani v. Salem, [1989] 1 W.L.R. 723; [1989] 2 All E.R. 143, referred to.

(3) Brink”s-MAT Ltd. v. Elcombe, [1988] 1 W.L.R. 1350; [1988] 3 All E.R. 188, followed.

(4) C Corp. v. P, 1994–95 CILR 189, followed.

(5) Inland Rev. Commrs. v. National Fedn. of Self-Employed & Small Businesses Ltd., [1982] A.C. 617; [1981] 2 All E.R. 93, referred to.

(6) Interoute Telecomms. (UK) Ltd. v. Fashion Gossip Ltd., English Ch. D., November 10th, 1999, unreported, followed.

(7) Marc Rich & Co. Holding GmbH v. Krasner, [1999] C.L.Y. 487, followed.

(8) Memory Corp. plc v. Sidhu (No. 1), [2000] 1 W.L.R. 1443; [2000] CPLR 171; [2000] FSR 921, followed.

(9) Prospect Properties Ltd. v. McNeill, 1990–91 CILR 32, followed.

(10) R. v. Cardiff City Council, ex p. Gooding Invs. Ltd., [1996] Env. L.R. 288; [1996] C.O.D. 129, followed.

(11) R. v. Commr. for Local Admin., ex p. Field, [2000] C.O.D 58, followed.

(12) R. v. Home Secy., ex p. Beecham, [1996] Imm. A.R. 87, referred to.

(13) R. v. Home Secy., ex p. Chinoy(1991), 4 Admin. L.R. 457, followed.

(14) R. v. Home Secy., ex p. Sholola, [1992] Imm. A.R. 135; [1992] C.O.D. 226, referred to.

(15) R. v. Kensington Income Tax Commrs., ex p. de Polignac (Princess), [1917] 1 K.B. 486; [1916] W.N. 412, followed.

(16) R. v. Lloyd”s of London, ex p. Briggs, [1993] 1 Lloyd”s Rep. 176; [1993] C.O.D. 66, followed.

(17) R. (Burkett) v. Hammersmith & Fulham London Borough Council (No. 1), [2002] 1 W.L.R. 1593; [2002] 3 All E.R. 97; [2002] C.P. Rep. 66; [2003] Env. L.R. 6; [2002] UKHL 23, considered.

(18) Rovenska v. General Medical Council, [1998] I.C.R. 85; [1997] I.R.L.R. 367, referred to.

(19) Sharma v. Brown-Antoine, [2007] 1 W.L.R. 780; [2006] UKPC 57, followed.

(20) Siporex Trade S.A. v. Comdel Commodities Ltd., [1986] 2 Lloyd”s Rep. 428, followed.

Legislation construed:

Grand Court Rules, O.53, r.4(1): The relevant terms of this paragraph are set out at para. 65.

Information and Communications Technology Authority Law (2006 Revision), s.9: The relevant terms of this section are set out at paras. 21 and 22.

Information and Communications Technology Authority (Interconnection and Infrastructure Sharing) Regulations, 2003, reg. 6: The relevant terms of this regulation are set out at para. 18.

reg. 10: The relevant terms of this regulation are set out at paras. 15 and 16.

reg. 22: The relevant terms of this regulation are set out at para. 19.

Civil Procedure-ex parte applications-material disclosure-applicant in breach of duty to make full and fair disclosure if gives misleading impression by failing to call attention to certain facts while emphasizing others, or fails to disclose relevant facts and law or to provide full notes of ex parte hearing to person affected by relief sought-court may discharge order as punitive measure, even if leave would have been granted if full disclosure made

The plaintiff applied for judicial review of a decision of the Information and Communications Technology Authority.

In a dispute between the plaintiff and two other service providers, including Digicel Cayman Ltd., the Authority had determined that the plaintiff was guilty of anti-competitive conduct as its rates for mobile telephone services were priced below cost. The plaintiff began negotiations with Digicel regarding the tests to be applied to its rates and also the level of the ‘mobile termination rate’ (MTR), i.e. the rate that companies charged each other for calls that terminated on their respective networks by subscribers who had initiated calls on one network and completed them on another. The plaintiff”s licence provided that, to compensate for the loss of its former monopoly, the MTR should be set according to its own ‘fully allocated cost’ (FAC) model until such time as the Authority set a permanent basis for the charge. The negotiations resulted in a settlement agreement by which an MTR of 18.45c. per minute was agreed. The agreement was filed with the Authority and accepted by it on July 29th, 2004, although it did not expressly approve the MTR.

The plaintiff alleged that the Authority was obliged to set a new charging basis no later than June 30th, 2006, and when it failed to do so, the plaintiff alleged that the agreed MTR should no longer apply, and requested the Authority to set an interim MTR in line with its FAC model, which, it claimed, would result in a ‘cost-oriented’ rate of 11c. per minute. The Authority determined that the MTR had been validly decided by negotiation and, in ICT Decision 2006–6 given on December 14th, 2006, declined to intervene to set the rate. The plaintiff applied ex parte for judicial review of the decision in an application filed on February 9th, 2007. The Authority brought the present proceedings, with Digicel joined

as an interested party, to have the order set aside on the ground, inter alia, that the plaintiff had not fully disclosed all the relevant information at the ex parte hearing.

The plaintiff submitted that (a) the Information and Communications Technology Authority Law (‘the ICTA Law’) and Regulations provided that its FAC model should continue to determine the MTR until the Authority set a permanent basis for the charge, and its failure to do so was a breach of its legal obligations; (b) the settlement agreement was subject to the express condition that it receive approval from the Authority and was also based on the assumption that the new model would be in place by June 30th, 2006; (c) there had been no material non-disclosure in its application for judicial review, since all the relevant information had been provided to the court, or if there were, any non-disclosure had not been deliberate; (d) its application was within the three-month time limit since the decision it sought to challenge was ICT Decision 2006–6, or, even if the operative date were that of the filing of the agreement, its claim was based on a continuing breach by the Authority of its duty to determine a cost-oriented MTR; and (e) given that any non-disclosure was, at worst, inadvertent, the court should allow its application for judicial review to proceed.

The Authority submitted that (a) the policy of the legislation was that the burden was on the licensees to negotiate rates, while the Authority was not bound to set MTRs and would only intervene in the absence of agreement; (b) failure to complete the new model by June 30th, 2006 was not an unforeseen event necessitating a review of the MTR, since this was merely the parties” view of the earliest date by which the new model could be in place; (c) the plaintiff, by placing inappropriate emphasis on certain provisions of the ICTA Law and Regulations at the ex parte hearing, had given the misleading impression that the Authority had rendered the settlement agreement non-binding by failing expressly to approve it, and was also in breach of its legal obligations by failing to observe the FAC model; (d) the application had not been made within the three-month time limit, since the decision that the plaintiff sought to challenge was, in reality, the Authority”s acceptance of the plaintiff”s filing of the settlement agreement on July 29th, 2004; and (e) in any event, the plaintiff had no adequate case for judicial review.

Held, setting aside the ex parte order and refusing leave to re-apply:

(1) Leave to apply for judicial review would be revoked since it would not have been given had the plaintiff made full disclosure. The onerous duty on an applicant for ex parte relief to make full and fair disclosure applied just as much in an application for judicial review as it did in one for injunctive relief. A failure to bring to the court”s attention material facts or to unduly emphasize certain facts while not referring to others, even if not deliberate, could amount to a breach of that duty. In addition, the applicant was required to disclose relevant law, as well as relevant facts, and to provide full notes of the ex parte hearing to any person

affected by the relief sought. Furthermore, an order might be discharged entirely as a punitive measure, notwithstanding that it would probably have been granted even if full disclosure had been made. The plaintiff had failed to meet its duty since the aspects it had emphasized had given the misleading impression that the Authority was in breach of its duty to establish a new charging model and was obliged in law to accede to the determination request (para. 53; paras. 55–56; para. 59).

(2) Furthermore, the court would exercise its discretion to refuse leave to re-apply for judicial review and the plaintiff”s application would be dismissed altogether. The procedure to set aside leave was to be invoked sparingly and would rarely be used in cases of innocent or inadvertent non-disclosure, especially in judicial review proceedings when leave was often granted on the expectation that the true merits of the case would be tested at the full, inter partes hearing. Nevertheless, an order discharged for non-disclosure would only be re-granted in plainly deserving circumstances, and, had the court been made fully aware at the ex parte hearing of the factual and legal issues, it would have been clear that the plaintiff”s case was without foundation and leave would not have been granted. Even though the plaintiff”s failure to make full disclosure might not have been deliberate, the court was therefore satisfied that its application for judicial review should be dismissed (paras. 59–61; para. 64).

(3) The court would also...