3 CX.R. 1988 July 27* ' * -V · T . u ' .it * P .it . ;. .- * •. " . -•· ' · [PIKIS, J.] ' \»tJ ' >i .- < j . • i. . . . ^ · <τ 4 , * . ^ , <; i/ m™'Nl\TTEROF'ARTICl£1460FTHECONSTmrnON.' " * . ' " '· J * . y ,. , . ,ΚΑΖΑΝ CARTONINDUSTRY LIMITED, J. '-- ·τ . ' ι ' « .. in Μ » * < . " " '·.,.' .< _ IJ ·. . j . . **..c ; ' 'Applicants, . ' ' • . . . v. . . ... . THECYPRUSPORTSAUTHORITY. t t f ) · - * , , - . ' ν. >t Respondents. (Case No531/87). Administrativepractice-j-~ifit restson anerroneous,viewof the law,it canand, indeed, it shouldberevised. Revocation of administrative act-^Thepower to revoke,evenan illegalact. is not absolute—The kind of reasoning required—To what matters the Ad ministrationmust specificallyaddress itself—Significanceof alongstand ing administrativepractice. .,, The applicants are importers of units of paper rolls.The respondents changed theirpracticetotreatpaperbig rolls on thesame footing as paper " rolls in'separate units (Class 3
(1)(i)) and began to claim charges under ' Class 3
(1)(xi) of theCyprus PortsAuthority (Charged Payable) Regula tions,
- At thesametime,"therespondentsdecided,andthisis thesec ondactchallenged by thisrecourse,tolevy additionalcharges inrespect of goods importedby theapplicantsearlier during
- *,„(- ΐ Γ ., \ Held: ·, · . - * · η - • . · • •·.
(1)The existence of an administrative practice,inconsonantwith the • law, raises noobstacles toits revision. Like every practice founded onan erroneousview of thelaw, itcan,indeed itshould,bechanged toconform toitsprovisions. Therespodentsareina uniqueposition tocomprehendthe realities of importations.The'Regulations make thelevyingof charges de pendent,interaliai onthe'form inwhich goods'are imported. Thatbeing the 1559 Kazan Carton Industry v.C.P.O.
(1988)casethefirstsubjudiceactwasreasonablyopentotherespondents.
(2)Thesecondsubjudiceactconstitutesarevocationofpreviousacts. Thepowertorevokeisnotabsoluteeveninthecaseofillegaladministrativeaction.Arevocatoryactupsetsrightsregardedassettled.TheAdministrationmustdulyreason itsdecision.Itmustaddressitself tothereasons 5 warrantingtherevocation,itseffectontherightsofthose affected. Inthiscasethesecondsubjudiceactisnotdulyreasoned.Indeed,there isnoreferencetotheeffluxion oftimebetweentherevocatorydecisionand thosedecisionsthatitrecalled,itseffect ontherightsoftheapplicantsand moresignificantly theimplicationsoftheretroactiverevisionofapracticeof longstanding. 10 Recoursedismissedasfarasthefirst subjudiceactisconcerned.Second subjudiceactanulled. Noorderastocosts. 15 Casesreferredto; AyiosAndronikosCo.v.TheRepublic
(1984)3CLA.1176; MoschovakisandAnother v.CM.C.
(1988)3C.L.R. 750. Recourse. Recourseagainst thedecision of therespodents toclassify the charges payable for the importation of unitsofpaperrolls under class 3
(1)(xi) of the Cyprus Ports Authority (Charges Payable) Regulations, 1976andthat thesameshould applyto importations madeduring thefirstfour monthsof 1987. 20 P. Mouaimis,for theapplicants. 25 N.Papaefstathiou, for therespodents. Cur. adv. vult. PIKISJ.read thefollowing judgment.Theapplicants,importersofpaper rolls,challengetwoactsof therespodents embodied 1560 3C.L.R. KazanKarton Industry v.C.P.O. PikisJ. inthesamedecision,affecting thechargespayablefortheimportationofunitsofpaperrolls.Thegoodswereimportedinrollsin containerswhereintheywerestored. In thedecisionof thePortsAuthority theproductsshouldbe classified for purposes of charges (Cyprus Ports Authority (ChargesPayable)Regulations 1976)underclass3
(1)(xi)applicabletotheimportation of products not separately identifiable. Andthesameshouldapplytoimportationsofpaperrollsmadeby theapplicantsduringthefirstfourmonthsof 1987.Accordingly, IQ theyleviedadditionalchargestothosepaidbytheapplicantsfor theirimportationsearlier.inthe.year.Thisis.thesecondactofthe respodents questioned in these proceedings amounting, in the submission of counsel for therespodents,to arevocatorydecisionofearlieradministrativeactsfoundedonamisconceptionof i- thelaw,oritsmisapplication.· 5 . * *• * t Theapplicantsdisputethecorrectnessofthetwodecisionson avarietyofgrounds: \ . . . 2o 2c 35 ••Respecting^thefirst decision itwasarguedthat itisarbitrary, unreasoned,restingonanerroneusinterpretation-and application of therelevantprovisionsoftheRegulations.Itistheircasethat theimportationofpaperinbigrollshadnoeffect ontheirclassification for purposesof charges;theproductsretainedtheirbasic character,thatis,paperrollsinseperateunitsand;assuch,ought tohavebeenclassified underclass3
(1)(i).'The understandingof therespondentsoftheeffect of therelevantRegulations,particularlytheimplicationsofimportinggoodsinbigunits;constituted adeparturefrompreviouspractice,afact cited asanadditional reason for theannulmentoftheactforreasonsofbadfaith.The respondents acknowledged the existence of a contrary practice;but felt free to depart from it for the reason that it was founded onamisconceptionofthelawresultinginthe'erroneous classification ofpaperrollsimportedinbigunits.Thebundlingof the goods in big rolls changed their character for purposes of charges,aviewconsistent,accordingtorespondents,withinternationalpracticeintheapplicationofsimilarprovisions affecting 1561 PikisJ. Kazan Carton Industry v.C.P.O.
(1988)portcharges. Theexistenceofanadministrativepractice,inconsonantwith the law,raises no obstacles toitsrevision. Like every practice founded on an erroneous view of the law, it can, indeed it should, bechanged toconform toitsprovisions.Thefollowing ^ passage from thejudgment of Triantafyllides, P. , as he then was, inAyios Andronikos Co. v. Republic,
(1984)3 C.L.R. 1176, 1181is an accuratereflection of therelevantprincipleof administrativelaw: "Inanyevent,however,astheadministrativepracticewas ^ notconsonant with theproper application of S.18
(1)(c) of Law9/85,itcannotbetreatedascreatingalegalsituationenablingtheapplicants tosucceed intheirpresentrecourse(see, inter alia, P. M. TseriotisLtd.v.Republic
(1970)3C.L.R. 135, 143;and Makrides v. The Republic
(1979)3 C.L.R. 15 584,601. See,also,Stassinopoulos -LawofAdministrative Acts, 1951ed., p. 19;Kyriacopoulos •GreekAdministrative Law,TomeA,4thed., pp.78&79)." TherespondentsaretheAuthorityentrustedbylawtoappreciate the implications of the importation of goods in different 20 forms andthenapplytheRegulationsaccordingtothespiritand letterof theirenactment. They are,inmayrespects,in aunique positiontocomprehend therealitiesofimportations.Therecanbe nodoubtthattheproductsoftheapplicantswereimportedinbig unitstransported incontainers.Itappearstomethat theRegula- 25 tions make the levying of charges dependent, interalia, on the forminwhichgoodsareimported.Thatbeingthecaseitwasreasonablyopentotherespondentstotreattheproductsoftheapplicantsasliabletochargesunderclass3
(1)(xi).Consequently,the first legoftherecoursemustbedismissed. 30 Determinationofthesecondaspectoftherecoursenecessitates examinationofthenatureofthedecisiontorevisedutiesimposed inthepast,theamenitytorecallsuchcompletedadministrativeactionand,lastlythereasoningandjustification forthedecisionitself. 1562 35 3C.L.R. 5 10 •>- 25 KazanCarton Industry v.C.P.O. PikisJ. It isacknowledged that theAdministration haspowertorevokeearlieradministrativeaction.Itisapowerprimarilyintended toenabletheAdministrationtorectify illegalactionandremedy errorsoccuringinthecourseoftheadministrativeprocess;anessentialpowerforthesustenanceoflegalityandtheefficacy ofthe administrativeprocess.Butthepowertorevokeisnotabsolute eveninthecaseofillegal administrativeaction.Thecaselawon thesubjectandtheprinciplesrelevanttotherevocatorypowersof theAdministration,werereviewed intherecentdecisionofAristos Moscovakisand Anotherv. CB.C.
(1988)3 C.L.R.750. Moreover,theAdrninistxationneednotspecifically labelitsaction asrevocatoryifanintentiontorecallearlieractioncanbeimplied withcertainty.(See,ConclusionsfromGreekCaselaw1929-59, p. 199). Thedecisionhereunderconsiderationwasclearlyintendedto revokeaseriesofearlieronesrestingonamisapplication ofthe law.Weare,therefore,confronted witharevocatorydecision.A revocatorydecisionmust,likeeveryotherexecutorydecision,be reasoned.Itcanbearguedthatthereasoningofarevocatorydecisionmustbeasexplicit asitcould be.Forbyaprocessofarevocatorydecisiontherightsofthoseaffected regardedassettled are, in essence, upset. The Administration must address itself specifically tothereasonswarrantingrevocationofanearlierdecision,thejustification forthemeasureandtheeffect onthe rights ofthoseaffected. Theneedforsuchreasoningisallthemorenecessaryinacaselikethepresentwherethedecisionssoughttobe revoked werebased onapracticeof theAdministration oflong standing;apractice nodoubtuponwhichcitizensplanned their action. 30 In thiscase there is nothing by way of reasoning explaining thenecessityforthemeasureoritsjustification.Thereisnoreferencetotheeffluxion oftimebetweentherevocatorydecisionand thosedecisionsthatitrecalled,itseffect ontherightsoftheapplicantsandmoresignificantly theimplicationsoftheretroactive re35 visionofapracticeoflongstanding. 1563 PikisJ. KozanCartonIndustry v.C.P.O.
(1988)Fortheabovereasons,Ifeeldutyboundtoannulthe revocatorydecisioninquestion,andIsoorder,pursuanttotheprovisions ofpara.4(b)ofarticle 146oftheConstitution. Thefirstpartoftherecourseisdismissed,andtherelevantdecisionaffirmed, pursuant totheprovisionsofpara.4(a)ofarticle 5 146oftheConstitution. Thereshallbenoorderastocosts. Subjudicedecisionpartlyannulled. Noorderastocosts. 1564