Suisse Security Bank & Trust Ltd v Francis (in the capacity of Governor of the Central Bank of The Bahamas)
| Jurisdiction | UK Non-devolved |
| Judge | Lord Mance |
| Judgment Date | 27 July 2006 |
| Neutral Citation | [2006] UKPC 41,[2006] UKPC 11 |
| Court | Privy Council |
| Docket Number | Appeal No 66 of 2004 |
| Date | 27 July 2006 |
[2006] UKPC 11
Privy Council
Present at the hearing:-
Lord Hope of Craighead
Lord Walker of Gestingthorpe
Lord Carswell
Lord Brown of Eaton-under-Heywood
Lord Mance
[Delivered by Lord Mance]
This is an appeal from the order of the Court of Appeal of the Bahamas (Ganpatsingh, Churaman and Osadebay JJA) dated 29 th June 2004, whereby the Court of Appeal, for reasons given in a subsequent written judgment dated 8 th November 2004, dismissed an appeal from the judgment given by Davis J on 25 th April 2003, which in turn dismissed an appeal by the appellant, Suisse Security Bank and Trust Limited ("SSBT") from the decision of the respondent, the Governor at the relevant times of the Central Bank of the Bahamas, revoking the appellant's licence to carry on banking and trust business within the Commonwealth of the Bahamas.
SSBT's licence was granted on 20 th July 1993 pursuant to s.4 of the Banks and Trust Companies Regulation Act (Chapter 287). The Governor on 5 th March 2001 gave notice that he was of the opinion that the licence should be revoked on the ground that SSBT was carrying on its business in a manner detrimental to the public interest and to the interests of its depositors and other creditors, and further purported pursuant to s.14(2) of that Act to suspend the licence immediately and to invite SSBT to submit on or by 15 th March 2001 a written statement of an objection to the proposed revocation of its licence. Also on 5 th March 2001, the Governor appointed Mr Raymond Winder as receiver of SSBT pursuant to s.14(1)(f) of the Act. On 2 nd April 2001, the Governor purported, pursuant to s.14(1)(a) of the Act to revoke SSBT's licence. On 19 th April 2001 an appeal to the Supreme Court was lodged in the name of SSBT under s.22(1) of the Act, seeking to reverse the Governor's decision revoking the licence and to obtain its restoration " nunc pro tunc" on the ground that he "acted ultra vires and without requisite jurisdiction having regard to the provisions" of the Act.
The relevant provisions of the Act are as follows:
"3. (1) No banking business shall be carried on from within the Bahamas whether or not such business is carried on in the Bahamas except by a person who is in possession of a valid licence granted by the Governor authorising him to carry on such business.
14. (1) The Governor may -
(a) by order, revoke the licence of a licensee -
(i) if, in the opinion of the Govenor, the licensee is carrying on its business in a manner detrimental to the public interest or to the interests of its depositors or other creditors or is either in The Bahamas or elsewhere contravening the provisions of this or any other Act or of any order or regulations made under this Act, or any term or condition subject to which the licence was issued,
(ii) if the licensee has ceased to carry on banking business or trust business, or
(iii) if the licensee becomes bankrupt or goes into liquidation or is wound up or otherwise dissolved,
and he shall subsequently advise the Minister of his decision;
(b) apply to the Supreme Court for an order compelling the licensee to comply with the direction, cease the contravention or to do anything required to be done where the licensee -
(i) is contravening or has failed to comply with a direction of the Governor.
(ii) is contravening the Act, or
(iii) has omitted to do anything under the Act that is required to be done by the bank or trust company;
(c) impose, amend or vary conditions upon the licence;
(f) at the expense of the licensee, appoint a receiver to assume control of the licensee's affairs in the interest of creditors who will have all the powers of a receiver under the Companies Act, 1992; and
(g) require such action to be taken by the licensee as the Governor considers necessary.
(2) Whenever the Governor is of the opinion that any action under subsection (1)(a)(i) and (b) should be taken against a licensee, he may forthwith suspend the licence of such licensee and before taking such action the Governor shall give that licensee notice in writing of his intention so to do setting out in such notice the grounds on which he proposes to act and shall afford the licensee within such time as may be specified therein, not being less than seven days, an opportunity of submitting to him a written statement of objection to such action, and thereafter the Governor shall advise the licensee of his decision.
(3) Whenever the Govenor shall suspend a licence under subsection (2) he may cause notice of such suspension to be published in the Gazette.
(4) Any suspension of a licence under subsection (2) shall be for a period of ninety days, or until the Governor takes action under subsection (1)(a)(i) or (b) or until the Governor notifies the licensee that the suspension is removed, whichever period is the shorter.
(5) Where the Governor suspends or revokes a licence under this section, he may apply to the Supreme Court for an order that the licensee be forthwith wound up by the court in which case the provisions of the Companies Act, 1992 relating to the winding up of a company by the court shall, mutatis mutandis, apply.
(1) An appeal shall lie to the Supreme Court from any decision of the Governor -
(a) revoking a licence under section 4(6), section 7(5) or section 14;
(b) withdrawing any approval under section 7(4);
(c) requiring a licensee to take certain steps which the Governor may specify under section 14.
…
(6) The Supreme Court may adjourn the hearing of the appeal and may upon hearing thereof confirm, reverse, vary or modify the decision of the Governor or remit the matter with the opinion of the Supreme Court thereon to the Governor.
(7) An appeal against a decision of the Governor shall not have the effect of suspending the execution of such decision."
Under s.17 of the Court of Appeal Act, an appeal from the Supreme Court acting in its appellate jurisdiction lies on a matter of law.
The issues pursued before Davis J and the Court of Appeal were substantially more extensive. But the submissions pursued before the Board fall under only three heads, which can be summarised as follows:
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(i) By suspending, then revoking SSBT's licence, the Governor acted in breach of an interlocutory injunction granted by Longley J on 2 nd March 2001 in separate judicial review proceedings commenced by SSBT against the Governor on 22 nd February 2001.
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(ii) The Governor, in breach of principles of procedural fairness, failed to give notice to SSBT prior to or on 5 th March 2001 that he was minded to suspend its licence on the grounds on which he actually suspended it on that date, together with an opportunity to respond before he took any such step.
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(iii) The Governor, in breach of principles of procedural fairness and/or of the terms of s.14(2), revoked SSBT's licence on 2 nd April 2001 on grounds different from, or additional to, those of which he had given notice on 5 th March 2001, without giving SSBT an opportunity to respond to such new grounds, and/or in circumstances in which he did not regard the grounds of which he had given notice on 5 th March 2001 as justifying such revocation.
Their Lordships make some preliminary observations. First, s.22(1) of the Act confers a right of appeal against a decision of the Governor revoking a licence, but not against a decision suspending a licence (although that could no doubt, in appropriate circumstances, be subject to judicial review). It is, therefore, open to question how far on an appeal under s.22(1), a court or the Board can consider the validity of a purported suspension. This was not however a point argued before the Board, and it can for the moment be left on one side. Mr Pannick QC in fact limited the relief sought, in the event that the appellant only succeeded in its second and/or third submissions, to an order remitting the matter to the present Governor for further consideration, with the suspension remaining in place for the time being. Only in the event of success in his first submission, did he continue to seek an order setting aside the suspension. Second, and in any event, suspension of a licence under s.14(2) is a matter for the Governor's discretion (cf the words "may forthwith suspend"), rather than a pre-condition or necessary concomitant of a notice of intention to act under s.14(1)(a)(i) or (b). The relevance of the second submission to any challenge to the revocation of the licence is therefore also open to question on this ground. Third, the present proceedings (begun on 19 th or 20 th April 2001) and the appeals in them have been pursued in the name of SSBT, although Mr Winder was appointed and acted from 5 th March 2001 as SSBT's receiver and as from 9 th April 2001 by order of Allen J as its provisional liquidator. There has never been any order setting aside either appointment. In the light of the second Court appointment in particular, no-one other than Mr Winder can on the face of it have had authority to act on SSBT's behalf. At an interlocutory hearing before Davis J on 15 th July 2002, junior counsel (Mr Gomez) then acting for the appellant told the judge that "Mr Harachji is the mover and shaker of the appellants and in real terms he is the appellant". Mr Harachji was and is the principal shareholder and chairman of the board of SSBT. The Court of Appeal thus described the appeal before it as "a further appeal by the principal shareholder", and Mr Blair QC told the Board that the Governor was content to continue on that basis.
The facts in detail
In order to consider the appellant's three submissions, a more detailed account of the facts is necessary. During the second half of 2000 and early 2001 the Central Bank in...
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