City Hall acted unlawfully by increasing cost of compliance- High Court rules

High Court Judge Gino Persaud on Tuesday ruled that the Mayor and City Council of Georgetown (M&CC) acted unlawfully and without authority when it introduced a 0.5% increase in cost for a Certificate of Compliance in 2019.

In his ruling, the judge commended the public interest litigation for judicial review which was filed by the Guyana Bar Association (GBA).

The genesis of the case stems from a notice published by the Town Clerk of Georgetown on June 20, 2019, which advised the general public of a 0.5% increase in the cost of applying for a Certificate of Compliance in relation to, among other things, the sale or transfer of property in and around the city.

According to the GBA, the cost to obtain a Certificate of Compliance from the M&CC increased from a flat fee of $10,000 to hundreds of thousands of dollars depending on the valuation of the property.

The GBA wrote to the Town Clerk twice requesting reasons for their decision, however, they were ignored.

As such, the GBA believes the decision of the Town Clerk for not providing reasons for the increase was an unlawful one and subsequently moved to the courts in filing the public interest litigation to challenge the MCC’s decision.

The GBA also sought several court orders including the quashing of the increase, a declaration that the M&CC decision for the increase was not authorised and out of their jurisdiction.

The M&CC, in its defense, provided the reason for the new policy as one to prevent fraud in applications for declarations of title by ascertaining that the persons to whom certificates of compliance are issued have a legal interest in the property.

The M&CC also contended that its power/discretion to request the submission of the set of documents is an implied or ancillary power or discretion flowing from sections 16A of the Deeds Registry Act and Courts are not to substitute their views on how such discretion is exercised.

The M&CC further contended that there is nothing in the legislation that prohibits them from setting fees and charges on a percentage basis as opposed to a flat fee. They further contended that the new fee is not a tax but a levy by a public body.

“The MCC is expressly empowered to raise revenue to carry out its statutory mandate and its fiscal provisions guide its income, expenditure, and financial reporting in the interest of accountability. It is expected to manage its financial affairs so as to break even. It is not empowered to raise additional revenue by increasing the cost for the issuance of a certificate of compliance which is exactly what it did,” the judge ruled, however.

Justice Persaud also ruled that the M&CC undoubtedly breached their fiduciary duty owed to ratepayers with the double levy in a single year when a property is intended to be transferred.

The judge also flagged the M&CC for failing to present evidence in their affidavits, such as minutes of a meeting or any official record to prove the “date when the impugned decision was made, by whom it was made, was it made at a statutory meeting, was it voted upon or was it made by one person or a group of persons.”

“I find that the impugned decision was without regard to the purpose for which the statutory powers are given and constitutes a breach of the fiduciary duty owed to ratepayers,” the judge said in his ruling.

The judge said that based on the affidavit filed by the M&CC, he is of the view that no expert legal advice on the new policy was sought before its implementation.

In closing, the Judge warned, “It cannot be too strongly emphasised that local government councillors are not legislators. Their duty is not to restructure the law but to exercise honestly and on a proper consideration of all relevant factors, the discretions which Parliament has entrusted to them.”

The Judge granted the orders sought by the GBA and awarded them $150,000 in cost.

Attorney-at-law Kamal Ramkarran represented the GBA, while Roysdale Forde, SC, represented the M&CC.