Lowell Lawrence v Financial Services Commission (Jamaica)

Retrospective validation legislation has that effect only where legislative intention is plain or the construction is unavoidable. A statutory fixed-penalty notice may be issued where the regulator has reason to believe that an offence was committed; it need not first determine guilt or provide a hearing. The notice leaves guilt to any later criminal proceedings, so natural justice does not ordinarily require a pre-notice hearing. The decision remains reviewable where the enabling provisions were not in force or no reasonable authority could have had the required belief. Validation of an earlier act does not validate a future prosecution. A public authority’s failure to disclose that its statutory power was unavailable may justify reversing a costs order against an administrative-law applicant.

The appellant sought judicial review of a penalty notice issued by the Financial Services Commission of Jamaica. The notice purportedly relied on section 21(2) of the Financial Services Commission Act 2001 and alleged that the appellant had acted as an unregistered insurance intermediary contrary to section 70 of the Insurance Act 2001.

The Full Court of the Supreme Court of Jamaica dismissed the application with costs. The Court of Appeal held that the notice had been validated by the Financial Services Commission (Insurance Services) (Validation and Indemnity) Act 2006 and dismissed the substantive appeal, while upholding the costs order. The appeal concerned validation, the right to a prior hearing, judicial review, and costs.

Lord Clarke delivered the judgment of the Board. The appeal was dismissed on validation and the substantive judicial-review challenge, but allowed in relation to the costs ordered by the Full Court.

1. Retrospective validation. A statute is construed retrospectively only where that intention is plain or unavoidable, following the principle in Yew Bon Tew alias Yong Boon Tiew v Kenderaan Bas Mara [1983] 1 AC 553. The recitals and section 2 of the Validation Act plainly covered all acts done in good faith by the FSC, in purported exercise of its statutory functions, during the specified period. The penalty notice was therefore validated, despite having been invalid when issued and despite the challenge having begun before the Act.
2. No prior hearing. Section 21 of the Financial Services Commission Act 2001 required only that the FSC have reason to believe that an offence had been committed. It did not require a prior determination of guilt. The notice offered the recipient a choice between paying the fixed penalty and facing possible prosecution. It imposed no criminal conviction or regulatory sanction, and guilt remained for the criminal court if the Director of Public Prosecutions prosecuted. Applying the fairness principle in Lloyd v McMahon [1987] AC 625 and the analogous reasoning in Re McCutcheon and City of Toronto (1983) 147 DLR (3d) 193, the Board held that no hearing was required before service of the notice.
3. Judicial review and future prosecution. The decision to issue a notice was reviewable. It would be unlawful if the statutory provisions were not in force or if no reasonable authority could have had the required belief. The Validation Act could not validate a future prosecution; possible abuse-of-process and statutory-construction arguments were left to the Jamaican courts.
4. Costs. Rule 56.15(5) permitted costs against the applicant on the facts as presented to the Full Court. However, the FSC had primary responsibility to ascertain and disclose that its powers were unavailable when the notice was issued. The appeal was therefore allowed as to the Full Court costs. Costs in the Court of Appeal and before the Board, and the precise substituted order, were left for written submissions.

1. Privy Council. In [2009] UKPC 49, the Board upheld validation of the penalty notice and dismissed the substantive appeal, but allowed the appeal concerning the Full Court’s costs order. Further costs orders were reserved for written submissions.
2. Court of Appeal of Jamaica. The court held that the Validation Act validated the notice, dismissed the substantive appeal and upheld the order for costs.
3. Full Court of the Supreme Court of Jamaica. The application for judicial review was dismissed with costs on 28 October 2005.