(1988)1988May26 (A. LOIZOU, P.] INTHEMATTEROFARTICLE 146OFTHECONSTITUTION CHRYSTALLENIA.KALLIMACHOUANDOTHERS, Applicants. v. THEMUNICIPALITYOFFOLISCHRYSOCHOUS, Respondents. (CasesNos. 396/87, 397187,398/87). Misconceptionoffact—Objectivenonexistenceoffacts takenintoconsiderationinreaching the subjudice decision—Amountstoamisconception of fact. Misconceptionoffach-Acting inignoranceofessentialandmaterialfacts— Amountstoamisconceptionoffact, 5 Reasoningbyanadministrativeact—Factsstatedintheoppositionnotsupportedbyactualfactsofthecase. InthiscasetheCourtreached theconclusion thatinimposing thesub judice professional taxes the respondents took into consideration nonexistent incomefrom leasesofpremisesand buildingsites(Cases396/87 JQ and398/87)andfromcultivationofland(Case397/87).Asaresultthesub judice decisions wereannulledonthegrounds of misconception of facts andlackofduereasoning. Subjudicedecisionsannulled. Noorderastocosts. 15 Casesreferredto: Foumiav.TheRepublic
(1983)3C.L.R.262; 1040 3 C.L.R. Kallimachou v. Polis Chrysochous M' lity MallourosandAnotherv. TheElectricityAuthorityofCyprusandAnother X1974)3GL.R.220; Christodoulou v.C.Y.TA.
(1978)3C.L.R. 61; Skarosv. TheRepublic
(1986)3C.L.R. 2109; Christofidesv. TheRepublic
(1966)3 C.L.R. 732; lordanouv. TheRepublic
(1967)3C.L.R.245; loannidesv.TheRepublic
(1972)3C.L.R. 318; Mikellidouv.TheRepublic
(1981)3C.L.R.461; SkapouMsv.TheRepublic
(1984)3 C.L.R. 554; Economidesv.TheRepublic
(1985)3C.L.R.
- Recourses. Recourses against thedecision of therespondents to impose profesional taxuponapplicantsfortheyear
- M.Kyriakides,for theapplicants, K.Chrysostomides, for therespondents. Cur. adv. vult. A.LOIZOU P.read thefollowingjudgment.Thesethreerecourseswereheardtogetherastheydealwithcommonquestions ofla*andfact. ' * Bymeansoftheprayerforrelieftherespectiveapplicantspray for:"Adeclaration of theCourt that theimposition of profes1041 A. Loizou P. Kallimachou v.Polis Chrysochou M' lity
(1988)sionaltaxof£70upontheapplicantbytherespondentMunicipalityinrespectoftheyear 1986iscontrarytoLawinexcess orabuseofpower,nullandvoid,andofnolegaleffect whatsoever." Thereisnoagreement between thepartieswithregardtothe 5 facts thatgaverisetothesubjudiceacts.Theyagreeonlyonthe point thattheyhaveemanatedfrom thefact ofownershipofimmovablepropertybytheapplicantswithinthemunicipallimitsof Polis Chrysochous. Itistherefore necessary todeal withtherespectivefactual backgroundassetoutineachparty'scase.Itwas JQ the contention of the applicantsin thefacts given in supportof their recourses that theydo not reside and theydonotcarryon anybusinesswithinthesaidmunicipallimits. Ontheotherhandthefacts statedinsupportoftheopposition ineachoftheaboverecoursesare: 15 "
(1)The applicant is not aresident of Polis Chrysochous butsheistheownerorco-ownerofahouseatGrivasDhigenis Street at Polis, in which she stays during the summer months and during her visits atPolis for thecarrying outof hervarioustrades.
(2)Theapplicantistheownerand/orco-ownerofbuildingsitesand/orpremiseswhichsheleasestootherpersonsand/or theownerand/orco-ownerand/oroccupierof variouslands situated within the municipal limits of Polis Chrysochous, manyof which shecultivates onapartnershipbasisandthey 25 yieldincometoher." Inreplytotheabovestatementoffactsintheopposition,each of theapplicants in recourses 396/87 and398/87 contended the folowing: "
(1)Regardingparagraph 1 oftheoppositiontheapplicant 30 allegesthat sheis nottheownerorco-ownerof ahouse,but sheisoffered hospitality byhermotherfor aperiod of tento 1042 20 3 C.L.R. , Kalllmachou v. Polis Chrysochou M' lit}' A. Loizou P. fifteen,days during the summer months for holiday purposes withher family. 5 10
(2)Regarding paragraph 2 of the opposition the applicant denies that she is the ownerof any building-site or premises, but sheis theowner of agricultural land within the municipal limits of Polis Chrysochous which shecedes to third persons inreturnofonehalfof theincomewithoutparticipatingin the losses and she is collecting seventy toone-hundred and fifty pounds annually during therecentyears." Thereply of theapplicantin Recourse No.397/87 wasas follows: "
(1)With regard toparagraph 1 of theopposition the applicant admits that she is the owner of a house in which she, however, staysfor afew days in the summer only but shedeniesthat sheisdoing any workatPolis. 15 20 25 30
(2)Out of paragraph 2 of the opposition the applicant admits only that she is the owner of shops which are leased to statutory tenants sincemany years andin anycase sheisnot carrying on business or trade within the municipal limits of Polis." . . . . . In the written address of the respondents under the heading "Facts"wereadthefollowing whichareidentical insofar asRecourses396/87and398/87areconcerned:"
(1)Though the applicant is not aresident she stays at the houseofhermotheratGrivasDhigenisStreetatPolisChrysochous whenever thisis necessary for thecarrying out of their professional andother tradesaswell asduringthesummervacation.
(2)The applicant istogetherwithhersisterDoraM.Kyriakides(applicant inRecourseNo.398/87),co-ownerof thefollowingimmovable properties which sheexploits and/or leases 1043 A.Loizou P. Kallimachou v.Polis Chrysochou M' lity
(1988)tothirdpersonsagainstarentwhichcorrespondstoapercentageoftheprofits. (a)Veris,49donums,oneevlek. (b)Veris,43donums,threeevleks. (c)Latsi,8donums. (d)Kambos-Latsi, 16donums. (e)Sikari-Poli,6donums. (f)Kokkina-Poli,6donums. (g)Gonia,22donums. (h)Kilades, 10donums. 10
(3)Inviewoftheamountoftheincomewhichwas reasonablyexpectedtobederivedbytheapplicantbytheexploitation and/orlease of herlands,therespondents,i.e.theMunicipal Corporation ofPolisChrysochous,imposedontheapplicant by meansof anoticedated 23rd October 1986,professional 15 taxofseventypoundsinrespectof1988." Theapplicantsintheirwrittenaddressesinreplytothewritten address of the respondent and in dealing with the aforequorted paragraph 2,contended that theydonotown thewholeshareof thelands under(a),(b),(c),and (d)of thesaidparagraph 2,but 20 each oneof themowns 1/4, 1/2, 1/4 and 1/2, respectively ofthe saidlands.They alsoadded "that theyhavenevercollected any amountfrom thelandsunder(e),(0,(g),and(h)aboveandthey do not know where they are exactly situated, and if they have beencultivatedtheyhavebeencultivatedunlawfully withouttheir 25 consentandwithoutanybenefit forthem.Theyarenottheownersofanypremises." 1044 s 3 C.L.R. Kallimachou v. Polls Chrysochou M' llty A. Lolzou P. Attheclarification stage,learnedcounselfor therespondents madethefollowing statement: 5 "Iwouldliketomakeacorrectiontoourwrittenaddressin Recourses Nos. 396/87 and 398/87, third page, third paragraph.Thewords'itisadmittedinthereplyof theapplicant, thatsheistheownerofpremiseswhichareleasedtostatutory tenantssincemanyyears'tobesubstituted bythewords'that applicantistheownerofagriculturallandwhichshedisposes forproductionofcerealsandshegetsashareoftheincome.'" * 10 Ihavesetouthereinabovedetailsofthevariousversionsofthe respondentsregardingthefacts,wherefrom itclearlyappearsthat respondentshaveputupthefollowingthreeversions: (a)Oneintheopposition. (b)Oneintheirwrittenaddress. (c)Oneintheclarification stage. Theversionoftheapplicantsistheoneappearinginparagraph 2oftheiraforequotedreplytotheoppositionwhichmoreorless tallieswithrespondents'version,asultimatelyformulated atthe clarifications stage,subjecttothedifference regardingtheextent ofownershipofthevariousplotsofland. 25 30 Therewasnodisputethatthesubjudiceprofessional taxwas imposed inexerciseof thepowersgiven to therespondentsby virtue of section 104, 105,and 106of theMunicipalCorporationsLaw, 1986(LawNo. 111of 85).Undertheaforesaid section 105,anypersonexercisingforprofit within anymunicipal limits,anybusiness,trade,callingorprofession shallobtainalicencetherefor uponanapplicationforthegrantofsuchalicence andtheMunicipal Corporation shalldeterminethefeespayable fortheissueofsuchalicencewhichshouldnotexceedthefeesin theThirdSchedule. 1045 A. Loizou P. Kallimachou v. Polis Chrysochou M'lity
(1988)Thecaseof theapplicantscomes underparagraph (i)of the said Third Schedule wherebythe fee payable is "not exceeding one-hundredandfiftypounds". Themaincontentionsonbehalfoftheapplicantswerethat(a) they were not carrying on any business within themeaning of 5 sections 104-106ofLaw 111/85(b)thatthereasoningofthesub judiceactwasnonexistent and/ormisconceived,and (c)thatrespondentsactedunderamisconception offactandlaw. Asalreadystatedtherespondentsallegeintheoppositionthat theapplicantsinRecoursesNos.396/87and398/87,areowners 10 of building-sites and/or premises which theylease tootherpersons, and the applicant in Recourse No.397/87,ownerofagriculturalland which yields income toher.Itisclearfrom sucha statement that in taking thedecision toimpose seventy pounds professional tax,ontheapplicants,outof themaximumofone- j ^ hundred andfiftypoundsprovided bytheLaw,the respondents musthavetakenintoconsideration also,theincomederived from theleaseoftheirpremisesandbuildingsitesinthecaseoftheapplicantsinRecoursesNos.396/87and398/87,andinthecaseof the applicant in Recourse 398/87 from thecultivation of their 2n lands.Itis,also,clear thatattheclarifications stagetherespondentsresignedfrom theallegationsthattheapplicantsinRecourse Nos.396/87and 398/87derivedincomefrom theleaseofpremisesandbuildingsitesandthattheapplicantinRecourseNo. 397/ 87derivedincomefrom thecultivation ofland.Sothetrueposition isthattheapplicantsinrecoursesNos396/87and398/87do notderiveincomefrom theleaseofpremisesorbuildingsitesand applicant in Recourse No. 397/87does not derive income from thecultivationofland.Itis,therefore,clear,thatintakingthesub judicedecision,theapplicantstookintoconsideration nonexistent factsnamelyincomefromleaseofpremisesandbuildingsites,in 30 thecaseof theapplicantsin RecoursesNo.396/87and398/87, andincomefromcultivation oflandinthecaseoftheapplicantin RecourseNo.397/87. It has therefore to be examined what is in law the effect of 35 1046 s 3 C.L.R. Kallimachou v. Polls Chrysochou M' lity A. Lofzou P. suchasituationAccording toSpiliotopoullos Manualon Admin istrative Law 2ndEditionp.409: ' 5 10 15 20 25 30 "452.Κατάτηνκρατούσανορολογίαν,συντρέχει'πλάνη περί-τα πράγματα' οσάκιςαποδεικνύεταιη αντικειμενική (ήτοιάνευουσιαστικήςκρίσεως)ανυπαρξίατωνπραγμα τικών ήνομικώνκαταστάσεων,αιοποίαιελήφθησανυπ* όψινυπότουδιοικητικούοργάνουδιατήνεφαρμογήντου προβλέποντοςτηνέκδοσιντηςπράξεωςαπρόσωπουκανό νος δικαίου,δηλαδήόταν αποδεικνύεταιότιτοδιοικητικόν όργανονπεπλανημένοςεξέλαβεν ότι υφίστανται αι νόμιμοιπροϋποθέσεις(ΣΕ 143/1954)." "According totheprevailingterminology,thereexists'mis conception of fact when there is proved theobjective non existence of thefactual orlegal situations,which were taken into considerationby theadministrativeorgan for theapplica tion of theimpersonal rule of law providing for theissueof theact,thatis tosay whenitis proved thatthe administrative organmistakenly tookitthatthereexiststhelawful prerequi sites." InFournia v. TheRepublic'
(1983)' 3 C.L.R. 262, Savvides J.,said atp. 279: "Thefact thattherespondenttookintoconsideration matters which werenotinexistence,rendersthesubjudice decision bad, on the ground of misconception of facts. Even mere probability of suchmisconceptionis enoughtovitiate the ad ministrativedecisioninvolved." And thelearnedjudgewentontociteinsupportof thisstate mentof thelaw aparagraph from thejudgmentdelivered inMal louros andAnotherv. TheElectricityAuthority of Cyprus and Another
(1974)3C.L.R.220 atp. 224. Inthecasesinhandtherehasbeenclearly proved theobjective non-existenceof thefactual situation whichwas takeninto con1047 A. Loizou P. Kallimachou v.Polis Chrysochou M' lity
(1988)siderationbytherespondents,namely,objectivenon-existenceof incomefromleaseof premisesandbuilding-sites inthecaseof theapplicantsinRecoursesNos.396/87and398/87andincome from cultivationof landinthecaseofapplicantinRecourseNo. 397/87.Therefore thisisaclearcaseof the subjudice decision 5 havingbeentaken undera misconceptionof fact. Itisasettled principle of administrative lawthat "material misconception of factoreventheprobabilityofitsexistencejustifiestheannulment of an administrative act. (See, inter alia, Christodoulou v. C.Y.T.A.
(1978)3 C.L.R. 61.). Inviewoftheaforesaid misconceptionoffactwhichisamaterialonethesubjudicedecisionmustbeannulled astakenunder such amisconception whichmakesitadecisioncontrary tothe wellsetdedprinciplesofAdministrativeLawandassuchadecisioncontrarytolaw,andinexcessofpowersinthesenseofArti- 1 cle 146.1 of the Constitution. (See loannidesv. The Republic
(1972)3C.L.R.318.) Thesubjudicedecisionsmustalsobeannulledforanotherreason which again amounts to misconception of fact, the followInthesecaseswearefaced withthesituationwherebytherespondentorganfailed tomakeadueinquirywiththeresultthatit acted inignoranceoftheessentialandmaterialfacts; andsucha situationamountstoamisconceptionoffact. (SeeSkarosv.The Republic
(1986)3 C.L.R. 2109; Christofldesv. The Republic
(1966)3C.L.R.732;Iordanouv. TheRepublic
(1967)3C.L.R. 245;loannidesv.TheRepublic
(1972)3C.L.R.318;Mikellidou v.TheRepublic
(1981)3C.L.R.461;Skapoullis v.TheRepublic
(1984)3C.L.R.554.) Itshouldbestressedthatmyconclusion aboutmisconception isnotoftheoreticaloracademicinterest,butithasamaterialbearingonthecase.Thisissobecausetheamountofthefeeisdeterminedbyreference totheincomederivedfromtheparticularbusinessor trade,which iscarried on.Consequently thetakinginto 1048 1( 3 C.L.R. Kallimachou v. Polis Chrysochou Μ'lily A. Loizou P. considerationof aspecies ofincomewhich wasnon-existentin evitably must have affected theamountof thefee andassuch, amountstomaterialmisconception. 5 Further thesubjudice decisions must beannulled for lackof duereasoning inthatthefacts stated inthe opposition arenot sup ported by the actual facts of thecase. (SeeEconomides v. The Republic
(1985)3C.L.R.222.) Having dismissed therecourse asabove, Ineed not deal with theremaining grounds oflaw. 10 Intheresult the subjudice decisions areannulled,butin the circumstancestherewillbenoorderastocosts. Subjudicedecisions annulled. Noorderasto costs. 1049