3 C.L.R. 1984 October 16 [PIKIS, J.] IN THE MATTER OF ARTICLE 146 OF THE CONSTITUTION ALEXANDRA RENT A CAR LTD., Applicants, v. THE REPUBLIC OF CYPRUS, THROUGH THE MINISTER OF COMMUNICATIONS AND WORKS, Respondent. (Case No. 437/83). Administrative Law—Misconception offact—Decision refusinglicence for ownership of and management of " Z " cars—Annulled as founded on a misconception of facts. 5 10 15 20 Company—// is a legal entity separate and distinct from its shareholders. Administrative Law—Administrative acts or decisions—Reasoning— Thoughit issettled that it may beextractedfrom orsupplemented byfacts inthefile of the casethisprinciple doesnotpermit supplementing of reasoning of a decision by reference to the facts of the case—And where the reasons of a decision are clear and unambiguousthey must be taken and evaluatedontheirface value. The respondent Minister set aside a decision of the licensing Authority whereby the applicants were granted a licence to own and manage 10 " Z " cars; and hence this recourse. The above decision was set aside on the ground that applicants misused in the past licences for " Z " cars by trading in them in defiance or breach of the provisions of the law. As a matter of fact, however the applicants never owned " Z " cars in the past or at any time. Held, that since applicants never owned " Z " cars in the past or at any time the facts upon which the decision of the licensing 1105 Alexandra Rent a Car v. Republic
(1984)authority wassetasidewereunfounded andtherefore thedecision was based on a misconception of the facts before the Minister; and that, accordingly, it must be annulled as founded on a misconception of facts. Held, further, on the contention of counselfor the respondent 5 that themisconception isnotfatal to the validity of the decision considering that there was evidencebefore the Ministerthat shareholders of theapplicant company hadinthe past improperly tradedin " Z " carsowned by them:
(1)That even if it were permissible to read the decision of 10 the Minister as saying something other than it did, and accept that what he wanted to convey was that the Company was no different from its shareholders, a question of misconception of the law (vould immediately arise because a limited company is a legal entity, separate and distinct from its shaieholders IS (see Salomonv. Salomon[1897] A.C. 22; Bank of Cyprus v. The Republic
(1983)3 C.L.R. 363).
(2)That though the reasoning of an administrative decision may be extracted from or supplemented by facts in the file of the case, this principle does not permit supplanting the reason- 20 ing of a decision by reference to the facts of the case; and that where the reasons of a decision are clear and unambiguous as they were in this case, they must betaken and evaluated on their face value. Sub judice decisionannulled. 25 Cases referred to: Salomon v. Salomon [1897] A.C. 22; Bank of Cyprusv. Republic
(1983)3 C.L.R. 363; Michaelides v. Gavrielides
(1980)1C.L.R. 244at p.
- Recourse. 30 Recourse againstthedismissal bythe respondent of applicant's hierarchical appeal from the decision of the Licensing Authority approving in part and subject to conditions applicant's application for a licence to own and manage 13 selfdrive cars. M. Cortstantinides, for V. Vassiliades,for the applicants. 15 M. Cleridou-Tsiappa (Mrs.), for the respondents. A. PanbyiotoUyfor the interested party. Cur. adv. vult. 1106 3 C.L.R. Alexandra Rent a Car v. Republic PIKIS J. read the following judgment. The applicants are a limited company, apparently formed, as we may surmize from their name, to own and hire self-drive cars, ordinarily identified as 'Z' cars. Theyapplied to the Licensing Authority 5 on 6.9.1982 under the provisions of the Road Transport Law* for a licence to own and manage 13 self-drive cars. After consideration of the matter, the Licensing Authority decided on 30.9.1982 to approve the application in part and subject to conditions specified therein. In particular, they grantedlicence 10 for the ownership of 10*Z'cars, subject to the condition that the owners should have no right to dispose of them by sale or otherwise as self-drive cars. If they ever decided to sell theminthefuture, theycoulddisposeofthemasprivatevehicles. The interested parties, owners of 'Z' u««s, objected to the 15 decision and considering themselves prejudiced thereby, they appealed to the Minister on 21st October, 1982, to review the decision ofthe LicensingAuthorityinviting himto discharge it. After the lapse of considerable time, the Minister decided** to set asidethedecision of the Licensing Authority and refused 20 the application inits entirety. It isa brief decision that singled out one factual consideration for refusing the application. Applicants, it is stated therein, misused in the past licences for 'Z'carsbytradinginthemindefianceorbreachoftheprovisions of the law. For this reason their application ought to bedis25 missed. As a matter of fact, the applicants never owned *Zy cars in the past or at any time. Consequently, the facts upon which the application was refused were unfounded. Evidently the decision was based on a misconception of the facts before the Minister. 30 Counsel for the respondent submitted the misconception is not fatal to the validity of the decision considering there was evidence before the Minister that shareholders of the applicant Company, the persons managing it, had in the past improperly traded in *Z* cars owned bythem. Even if it were 35 permissibleto read the decision of the Minister assayingsomethingotherthanitdid,andacceptthatwhathewantedtoconvey • Law 16/64 as amended—In particular by Law 9/
- · · 14th September,
- 1107 Pikis J. Alexandra Rent a Car v. Republic
(1984)was that the Company was no different from its shareholders, a question of misconception of the law would immediately arise. A limitedcompanyis alegal entity,separateanddistinct from its shareholders*. The separateness of the [company from its shareholders was emphasized in the most categorical 5 terms by theSupremeCourtinMichaelides v. Gavrielides
(1980)1 C.L.R. 244. It was depicted thus (p. 258): "In the present appeal, there is no escape from the fact that the company is a legal entity entirely separate from its corporation. Here the company and the two indivi- 10 duals, the son and his wife, forming the company, are entirely separate entities, however complete the control might be of the two individuals over the company". It is settled the reasoning of an administrative decision may be extracted from or supplemented by facts in the file of the 15 case. This principle, on the other hand,does not permit sup planting the reasoning of a decision by reference to the facts of the case. Where the reasons of a decision are clear and unambiguous, as they are in this case, they must be taken and evaluated ontheirface value. Any otherapproachwould open 20 the door to overriding administrative decisions by reference to the facts of the case. Such course would be arbitrary as it wouldbearbitrary inthiscasetoread thedecisionoftheMinister as saying anything other than it expressed, namely, that appli-" cants improperly traded in *Z' cars in times past. Evidently 25 the Minister misconceived the facts either due to error on his part or misappreciation of the facts before him. The decision was founded on a misconceptionof thefacts that invalidated it in its entirety. It is unnecessary in the present proceedings to examine the 30 amenity of an administrative authority applying the provisions of the MotorTransport Law, or any other law for thatmatter, to take into consideration in coming to a decision theconduct of the shareholders or management of the company as distinct from the conduct of the company itself,a separate legal entity. 35 The question does not arise for consideration and I consider it * Salomon v. Salomon [189η A.C. 22; Bank of Cyprus v. Republic
(1983)3 C.L.R. 363. 1108 3 C.L.R. Alexandra Rent a Car τ. Repubttc PUds J. inadvisable to express an opinion, more so as the subject was not canvassed at depth. In the light of the above, the decision is set aside as founded on a misconceptionof facts. Let there be no order as to costs. 5 Subjudice decision annulled.No order as to costs. 1109