What is its relevance to the Cayman Islands?
The Magna Carta has been heralded as a bastion of freedom, its defining principles taken up by defenders of democracy around the world. Its provisions are found in the constitutions of some of the world’s major economies and, in the U.K., many regard it as the written part of Britain’s unwritten constitution.
So, what can we glean from it that is relevant to the Cayman Islands in 2015?
The Magna Carta was a royal charter to which King John (under duress) appended his royal seal at Runnymede on June 15, 1215, almost exactly 800 years ago. It resulted from a fight between the king and the barons, umpired by the Archbishop of Canterbury, who got to draft the text. What he wrote exemplifies the axiom, “He who controls the minutes controls the meeting.”
The first thing he did was to establish the supremacy of the godhead and, in turn, the church.
In times when church law prevailed, this had the effect of placing the King under the law, thereby removing the divine rights of kings, considered sacrosanct (at least by the Crown) up to that point.
The relevance of this to the common man was that the king’s henchmen were also subject to the law and could no longer consider themselves above the law by ostensibly acting for the king.
This meant that all civil servants, regulators, police, military and other public servants were subject to the law, a provision that endures to this day, along with the clauses that have protected the church.
To underline the principle of the rule of law, perhaps the most important provision is Clause 45, which states: “We will not make men justices, constables, sheriffs or bailiffs unless they are such as know the law of the realm, and are minded to observe it rightly.”
The landmark element here is the phrase, “minded to observe it rightly.” From this phrase stems today’s vast body of Administrative Law, the law that governs the conduct of all persons in public administration. Since it seems to be so little understood, let us start with the central tenets of Administrative Law and then examine what they mean to Cayman’s public servants, including appointees to statutory boards.
Under the law, every administrator has a duty to be neither arbitrary, capricious, unreasonable nor unfair, particularly with respect to administrative decisions affecting the public. From these precepts stem a number of rules that impose further duties.
One of the prime obligations is the duty to uphold the law and not to vary it. Just as a judge cannot change the law through his judgment decisions, an administrator cannot change the law through his administrative decisions because changing the law is the province of Parliament.
This is a fundamental obligation that prevents administrators from applying the law improperly to suit a particular preference, purpose or agenda.
In turn, the public is entitled to a legitimate expectation that the law will be upheld by those giving practical effect to it. A decision that varies the law is known as “ultra vires” (outside the truth [of the law]) and becomes voidable. In my experience, ultra vires decisions are being made far more frequently than they should.
Fairness accords a right of reply for anyone adversely affected by an administrative decision. Fairness also imputes a duty of disclosure and a duty to give reasons. The duty of disclosure enables access to relevant documentation to ensure that the administrator reached his decision having regard to all the relevant material.
The duty to give reasons enables the affected party to analyse the decision-making process and determine whether the administrator has acted fairly in reaching his decision. Together, these duties enable a person adversely affected by a decision to know and understand the case against him and to assemble proper grounds of appeal under the right of reply (whether or not the law in question provides for a right of reply).
Bias is an interesting topic. Under Administrative Law, there are two forms of bias: the exercise of bias, known as actual bias, and the potential for bias, known as apparent bias. The existence of apparent bias is all that is necessary as the test for whether people in public administration should participate in an administrative decision.
Essentially, apparent bias means: if a person in public administration has a financial, proprietary or related interest in the outcome of a decision, then this is sufficient to cause his automatic disqualification, without any investigation into whether there was a likelihood or suspicion of actual bias.
The mere fact of his interest is sufficient to disqualify him. Apparent bias is not limited to pecuniary interest. Interest could pertain to a strong commitment to some cause or belief or to association with a person or body that holds an interest in the proceedings, including an employer.
In sum, administrators have to be in a position to make independent unfettered lawful decisions.
The test is not whether bias has been exercized, but whether there exists the possibility for bias to be exercized.
There exists a broad local perception that appointment to a statutory board is given as a form of reward, particularly following an election. This notion raises serious red flags. If duties are discharged honorably with complete independence, as they should be, then the job involves unpaid work for no reward, save any stipend from government.
To the extent that these appointments are considered a reward, whether in cash, kind or influence, clearly there is a problem. Any expectation of gain or influence has, at the very least, to involve bias in administrative decision-making.
Such bias represents a breach of good governance, is unlawful under Administrative Law, and could conceivably constitute a breach of criminal law. As the Magna Carta determined, administrators are not above the law, and this may help allay fears in the public mind that boards can do as they please.
One of the difficulties with Administrative Law is that it exists at common law. There is no statutory law to look up, only case law, which is not exactly user-friendly. Fortunately in recent years, some of the principal Administrative Law obligations have been codified into statute law.
Duty of disclosure
The duty of disclosure is now enshrined in the Freedom of Information Law. The duty to give reasons is covered in section 19 (2) of the Bill of Rights. Combine an FOI request with a section 19 (2) request and you can obtain both disclosure and reasons without having to go down the path of appeal or judicial review. Historically, administrators have been loathe enough to release documents, much less explain the reasoning to support their decisions.
Today, it is not enough to say, “Here are the documents and that is all there is on the subject.” Even if no documents exist, written reasons for decisions still have to be produced when called for.
Bill of Rights
Other tenets of Administrative Law are covered in Section 19 (1) of the Bill of Rights that requires acts of public officials to be lawful, rational, proportionate and fair. Then we have section 24 that makes it unlawful for a public official to make a decision or to act in a way that is incompatible with the Bill of Rights. Taken together, these two provisions grant far-reaching powers to the public.
Disclosure, particularly of personal interests, is further augmented in the Anti-corruption Law, and the Standards in Public Life legislation.
Better guidance needed
Despite all of the above, there is a clear need for better guidance on the selection and functioning of board appointees so as to meet both the legal obligations and the principals of good governance.
For example, it is clear that apparent bias needs to be used as one of the selection filters. This means that no person should be appointed to a board who is in a position to gain, whether on not he or she actually gains, by the grant, delay, hindrance, encumbrance or refusal of an application. An example of a positive decision would be where a board member is in a position to sell goods or services to a person whose application was approved.
An example of a negative decision is where it results in reducing or limiting competition for that board members’ interests or the interests of anyone who controls or influences him. An example of a criminal decision is where an application is only approved if a Board member or connected person ends up with a share in the applicant’s business.
Training for board appointees would surely be worthwhile because there is quite a lot to learn if the public is to be properly served. This could culminate in an appointee signing to acknowledge a list of duties to be upheld in the discharge of office.
Another good practice would be to set term-limits and rotate board membership to avoid entrenchment. This is currently done in some cases but not in others. Since good governance is prescribed in the Bill of Rights, it could be applied toward consistent administrative practice throughout government and government-owned entities without requiring to change any of the underlying laws. Such action would merely be giving practical effect to section 24.
In order to promote greater awareness of Administrative Law duties, the U.K.’s Administrative Justice and Tribunals Council has published a book that sets out the responsibilities of administrators in an easy to understand format. It would seem to make sense that this book should become required reading for all civil servants and statutory board members. In turn, it would help reduce the number of appeals and the cost to Government in defending those appeals.
In this review of Clause 45, we have examined some of today’s issues and offered some remedies. Public confidence in statutory boards needs to be restored, and there is no better way to do this than by reflecting the Magna Carta.
That is to ensure statutory appointments are made only to persons who know the law they are to administer and are minded to observe it rightly through the proper application of Administrative Law and its legislative progeny.
Peter Gibbs was head of Cayman’s maritime administration, charged to act as the persona of its merchant shipping legislation. At some 5,000 pages, this is the largest body of law under a single administration, made all the more complex by having to incorporate the provisions of 35 international conventions applicable to shipping. Currently, Peter is a director of Pensum Ltd. He may be reached at [email protected].