COMMONWEALTH OF THE BAHAMAS No. 70 of 2006
IN THE COURT OF APPEAL

B E T W E E N:
SAVE GUANA CAY REEF ASSOCIATION LTD.
1st Appellant
- and –

AUBREY CLARKE
2nd Appellant
- v –
WENDELL MAJOR
As secretary to the National Economic Council
1st Respondent
- and -
THE MINISTER RESPONSIBLE FOR CROWN LANDS
In the person of the Prime Minister
2nd Respondent
- and -
THE TREASURER OF THE BAHAMAS
3rd Respondent
-and-
PASSERINE AT ABACO LIMITED
4th Respondent
-and-
PASSERINE AT ABACO HOLDINGS LIMITED
5th Respondent
-and-
BAKERS BAY LIMITED
6th Respondent
-and-
BAKERS BAY HOA LIMITED
7th Respondent
-and-
BAKERS BAY MARINA LIMITED
8th Respondent
-and-
BAKERS BAY FOUNDATION LIMITED
9th Respondent

___________________________________________

Appellants’ Written Submissions

May 14, 2007

For the hearing of the appeal

And in Support of the Appellants’ motion for an injunction

Pending delivery of Judgment

By

The Court of Appeal

___________________________________________

References in these submissions to documents in the appeal bundle are in square brackets and in the form [bundle/tab/page].

Introduction

1. This is an appeal from the Judgment of The Honourable Acting Judge Norris Carroll dated 12th October 2006 in which he dismissed the Appellants’ application for judicial review against of the decision of the First to Third Respondents (“the Government Respondents”) to enter into an agreement dated 1st March 2005 (“the Agreement”) with the Fourth to Ninth Respondents (“the Developers”) approving a very substantial development on Guana Cay, one of the Abaco Islands (“the Development”) and purporting to grant certain rights and concessions to the Developers in respect of the Development. The First Appellant (Save Guana Cay Reef Association) is an association formed by the residents and landowners of Guana Cay to represent their interests in respect of the proposed Development, and the Second Appellant (Mr Aubrey Clarke) is a long-time resident of the Cay.

2. As the Learned Acting Judge found (at paragraph 112 of his Judgment [5/45/81]) the Development will (if permitted) completely change the community of Guana Cay. It is by any standards a development on a massive scale, involving a gated community of over 400 lots, a hotel, a golf course, a mega-yacht marina and the construction of a new village. It will occupy a very substantial portion of the island, including Crown and Treasury Lands the use of which has been enjoyed by the islanders for decades.

3. The Appellants therefore submit that, before the decision to permit the Development was made, and prior to the granting of any rights to the Developers, it was essential that proper lawful process was observed. The Appellants further submit that this was simply not done. There was no proper consideration of the Development by the former government prior to signing the Agreement, no proper or meaningful consultation with the local community, and the local government was bypassed and powers vested in it purportedly exercised by the former central government. They have therefore brought these judicial review proceedings.

Background

4. The application for leave to bring the judicial review proceedings [1/1/1] was issued by the First Appellant on 4th April 2005 (shortly after the Guana Cay community learned of the signing of the Agreement). That application comprehensively set out the grounds of review over 35 pages. Leave to issue judicial review proceedings was granted by Isaacs J on 4th April 2005 [1/5/74].

5. Rather than responding to the substantive points raised in the judicial review application, the Government and Developers sought to have the application dismissed on the basis that the First Appellant did not have locus standi to pursue the application. Isaacs J revoked leave on that basis by Judgment dated 26th May 2005 [2/22/104]. That was successfully appealed to this Honourable Court, who restored the leave to bring judicial proceedings and further granted leave to add the Second Appellant who, as a resident of Guana Cay, undoubtedly had standing to pursue the judicial review proceedings.

6. This Honourable Court therefore restored the substantive judicial review proceedings to be determined by a different judge of the Supreme Court. In addition, upon this Court indicating that it was minded to grant an injunction to restrain the continuation of works on the Development (which had at that time already started) pending the determination of the judicial review proceedings, the Developers gave an undertaking not to proceed with those works until a certain date, by which time it was hoped the judicial review proceedings would be resolved.

7. The judicial review proceedings were restored before Carroll AJ. The Appellants made an application for certain discovery and leave to cross-examine the Respondents’ witnesses on their Affidavit evidence, which application was rejected by Carroll AJ. The trial of the judicial review application was heard by Carroll AJ in late January and early February 2006.

8. Regrettably, Carroll AJ did not deliver his Judgment until 12th October 2006. In the meantime, the Developers sought and obtained leave to withdraw from their undertaking. Consequently, the Appellants sought an injunction to restrain the developers from continuing with the Development until Carroll AJ’s Judgment was delivered. The application for an injunction was rejected by this Honourable Court, but granted ex parte by the Honourable Privy Council. The Developers’ application to the Privy Council to discharge the injunction was dismissed by the Privy Council, who held that there was a prima facie case for judicial review. The injunction remained in place until Carroll AJ delivered his Judgment on 12th October 2006. The Judgment is at [5/45/26].

9. Carroll AJ rejected each of the grounds of review put forward by the Appellants, although he expressed concern (at paragraphs 238-246 of the Judgment) at the proposals for the Development to be gated and thus segregated from the rest of the Guana Cay [5/45/121-123]. The Appellants issued a Notice of Appeal against the whole of the Judgment on 21 November 2006 [5/53/239]. The Developers issued a Respondents’ Notice dated 4th December 2006 [5/54/248]. The Government has issued no Respondents’ Notice.

The Agreement

10. The judicial review application focuses on the Agreement entered into between the Government Respondents and the Developers in respect of the Development and dated 1 March 2005. It is therefore appropriate briefly to summarize that Agreement.

11. As appears from the first paragraph of the document, the Agreement was purportedly an Agreement between the “government of the Commonwealth of the Bahamas” represented by the First Respondent “acting under the authority of the National Economic Council (hereinafter called the Government)” of the one part, and the Developers of the other part. It is clear from the terms of the Agreement that it was intended to be a binding contract and have contractual force - see for example:

11.1 clause 10 which states “Each of the parties hereto warrants its power and authority to enter into this Heads of Agreement and further that the terms and conditions of this Heads of Agreement shall be enforceable in accordance with such said terms and conditions.” (emphasis added).

11.2 Clause 16, which states “Save for approvals previously issued by the Bahamas Investment Authority and any other department or agency of the Government, this Agreement sets forth the entire agreement between the Government and the Developers relating to the Development …”

11.3 Clauses 15 (notice clause), 17 (assignment clause) and 18 (governing law and jurisdiction clause).

12. By the Agreement the Government Respondents purport to do two things. First, the National Economic Council (which, it is understood from the First Respondent’s Affidavit at paragraph 7 [1/15/376], equates to the Cabinet) records its decision to approve the Development and that it had decided that the Development would impact positively and significantly upon the Bahamas and Abaco in particular. This is done at recital J of the Agreement, as follows:

“The Government, being satisfied that the Development will impact positively and significantly upon the economy of the said Commonwealth and the Island of Abaco in particular, has approved in principle the development upon the terms and conditions hereinafter appearing and the entering into of the Conditional Purchase Lease, the Marina Lease, the Preserve Lease, the Treasury Land Lease and the Staging Area Lease (collectively referred to as the Lease Agreements).”

(See also clause 5.1, whereby the Government states that it “agrees in principle” with the Development).

13. Second, by clause 6 of the Agreement (entitled “Development Permissions and Concessions”) the Government agrees to grant a number of important concessions and permissions. These include agreeing to enter into the lease agreements to lease very substantial portions of Crown and Treasury land to the Developers. The government also agrees (at clause 5.2) “not to permit any of the remaining Treasury Land to be used for any purpose that may have a negative effect on the Development.”

14. In consideration of these concessions, the Developers agree to undertake the Development in a certain way as set and in compliance with the terms set out in clauses 1 to 4 of the Agreement).

The grounds of review

15. In the trial below, the Appellants sought to judicially review the decision of the Respondents to approve the Development in principle and enter into the Agreement with the Developers. The relief claimed was in three broad forms:

15.1. Declarations that the Government Respondents did not have the power or authority to enter into the Agreement as they purported to do or confer the rights purportedly conferred under that Agreement.

15.2. Orders prohibiting the Government Respondents from granting the various leases, rights and other concessions which they purportedly undertake to grant under the Agreement.

15.3. Alternatively, orders for there to be proper and meaningful public consultation prior to any such Agreement being entered into and such leases rights or other concessions being granted.

16. The grounds of review were set out in detail in the Re-Re- Amended Notice of Motion filed on February 23, 2006 [1/3/40]. They fall into four headings:

16.1. The Government Respondent had no power or authority to enter into the Agreement and give the undertakings and grant the rights purported given in that agreement. Those powers were not vested in the Government Respondents under law. In purporting to enter into the Agreement and confer rights and grants under it the Government Respondents were acting ultra vires.

16.2. Even if (contrary to the above) no specific grants are made under the Agreement, by deciding to enter into the Agreement the Government Respondents have fettered their discretion, and that of the other relevant decision making bodies, in relation to the proper granting of approvals and permits for the Development.

16.3. The decision to enter into the Agreement was in any event irrational. It was a decision which no reasonable public official could have come to.

16.4. There was a legitimate expectation of proper and meaningful public consultation, and of such consultation being taken account of, prior to the Agreement being entered into. Further or alternatively, whether or not there was any such legitimate expectation, procedural fairness required such consultation. This legitimate expectation and/or requirement of procedural fairness was breached. There was neither proper nor meaningful public consultation, nor was such consultation taken account of.

17. It is important to understand that the Appellants are not asserting any private law rights against the Respondents. Rather, they are seeking to invoke the Court’s undoubted jurisdiction to ensure that administrative decisions and actions are lawfully undertaken. As Lord Templeman put it in the Privy Council decision in Mercury Energy Ltd v Electricity Corporation of New Zealand Ltd [1994] 1 WLR 521 (at 526A): “Judicial review was a judicial invention to secure that decisions are made by the executive or by a public body according to law even if the decision does not otherwise involve an actionable wrong.” The distinction between private legal rights and public rights under judicial review as clearly drawn by the English Court of Appeal R (Beeson) v Dorset County Council [2003] HRLR 11 at paragraph 17 as follows:

“Whether or not executive action touches the citizen’s rights in private law is at common law irrelevant to the availability of judicial review to test the action’s legality. … The basis of judicial review rests in the free-standing principle that every action of a public body must be justified by law, and at common law the High Court is the arbiter of all claimed justifications.”

18. Thus, judicial review has been described by the English Court of Appeal as “the means by which the exercise of power by any public authority is strictly limited to the scope and purposes of the power’s grant, and subjected also to the common law’s insistence on rationality and fairness”: Lord Justice Laws in Sheffield City Council v Smart [2002] EWCA Civ 04 at paragraph 20. In the present case, the actions of the Government Respondents in entering into the Agreement cannot be “justified by law” as required: they were not within the scope of the powers granted to them, and they do not in any event meet with the common law’s insistence on “rationality and fairness”. They are thus liable to be set aside, on the basis of the grounds summarized above, each of which will be examined in turn below.

The initial issue: whether the matter is justiciable

19. Before turning to a detailed analysis of the grounds of review an initial issue should be mentioned. The Developers and the Respondents raised an initial question of whether the decision to enter into the Agreement was one that “qualifies for judicial review”, on the basis that (they asserted) it was a “policy decision” of the Cabinet to enter into the Agreement.

20. The learned judge dealt with this issue at paras 11 to 22 of his Judgment [5/45/31-38]. He rightly rejected the submission that such a decision was somehow exempt from judicial review, finding (at paragraph 22) that “it is my understanding that the decisions of authorities such as the one involved in this case, are indeed amenable to review by the Courts and I so hold.”

21. The learned judge was right so to find. Further, the Respondents have not sought to challenge this finding. The Government Respondents have not filed a Respondents’ Notice; the Developers have filed a Respondents’ Notice (at [5/54/247]) but do not challenge this aspect of the learned Judge’s judgment.

22. It is important to emphasize that it is not simply the policy decision of the Cabinet to approve the Development and enter into the Agreement which is being challenged, it is also the grant of the various concessions and rights under the Agreement which is the subject of review. Thus, there are two aspects to the challenge: the determination in principle that the Development was in the best interests of the community and should be approved; and the conferring of certain rights and concessions under the terms of the Agreement resulting from that prior determination. The learned Judge failed to appreciate the distinction between these two aspects of the judicial review application, and fell into error as a result.

23. There is a further general issue which underpins the grounds of appeal.

24. The Appellants will also rely on Article 15(a) of the Constitution which provides for a right to “the protection of the law”. It is submitted that the Appellants have been deprived of their rights to the protection of the law.

25. This submission applies to all of the grounds of appeal. This right has been breached in the following ways.

25.1. The entire process that has been adopted by the “Government” is extra-legal. It is arbitrary. The Agreement purports to give an omnibus approval for a private ten year real estate development plan which requires approximately 140 acres of Crown and Treasury Land. There is no statutory provision for such an approach to governance in the Bahamas. The closest that comes to this is the act authorizing the Governor in Council to enter into the Hawksbill Creek Agreement (HCA). Due process was adhered to then. The proposed HCA agreement was tabled, debated and Parliament passed the act authorizing the Governor in Council to enter into the HCA. A similar approach could have been adopted for instance under the Bahamas Incentives Act. The whole process adopted in this case seeks to circumvent the protection of the laws, Parliamentary scrutiny, and due process in the Bahamas to which the Appellants are entitled. The Agreement, and the entire approach to its implementation is outside the law and unlawful. Notwithstanding lip service in the Agreement to the need to get certain permits, it was never intended that there should be proper consideration by Ministers under relevant statutes, proper granting of permits by the District Council and proper consideration by other relevant bodies (for example, the Governor-General or the Treasurer). The effect of the Agreement is to purport to bind future Cabinets, Ministers and other statutory bodies with a ten year fait accompli.

25.2. In addition, the Agreement and the process adopted of negotiating the Agreement which affects public funds and public rights was outside public or parliamentary scrutiny. The means of supervising the proper and lawful decision-making by the relevant bodies has been denied the Appellants. This is another aspect of the deprivation of the protection of the law.

25.3. The refusal to give discovery or allow cross-examination is another aspect of this deprivation. The proper review of the decision-making process, and the transparency required to guarantee protection of the law, has been removed in this case.

25.4. The protection of various very practical lawful rights (such as the right to use the Crown Lands for public benefit, the right to use the beaches, traditional crabbing, fishing and hunting rights) has been denied the Appellants without any proper or lawful process.

25.5. In addition to the right to the “protection of the law”, the Public Trust Doctrine, the Financial Principle of the Constitution and Separation of Powers Doctrine have been breached by the process adopted by the 1-3rd Respondents.

26. The above issues will be addressed within the submissions under various grounds of appeal.

Ground 1: The Agreement was ultra vires

The issue

27. By their first ground of review the Appellants submit that the First Respondent (as secretary to the Cabinet/National Economic Council) did not have power lawfully to enter into the Agreement and, in particular, did not have power to confer the various rights and concessions granted under the Agreement at clause 6. This is because the power to grant those rights and concessions is vested not in the Cabinet or the National Economic Council, but in other authorities, such as The Governor-General, the Treasurer, individual Ministers and/or in the local Hope Town District Council. In purporting to grant those rights and concessions to the Developers, the entry into the Agreement was therefore ultra vires.

The Judgment

28. The learned Acting Judge addressed this issue at paragraphs 43 to 96 of his Judgment [5/45/52-75]. He dealt with it in two parts, as set out in more detail below.

29. First, the Learned Acting Judge spent a considerable portion of his Judgment considering whether the First Respondent (Mr Wendall Major) had power to enter into the Agreement on behalf of and as agent for the Cabinet/NEC. The Learned Acting Judge appears to have believed that the Appellants were submitting that Mr Major had entered into the Agreement in some other (personal) capacity, an argument which he was at pains to reject. He held (at paragraph 61 [5/45/104] that “The Applicants could not possibly have believed that Mr Wendell Major just simply arrogated to himself the authority of the Government exercised in the signing of the said Heads of Agreement, even as the executive looked on!” The Appellants did not believe this, and did not argue it. The Appellants do not for a moment believe that Mr Major entered into the Agreement on a jaunt of his own and accept that he was entering into the Agreement as agent for the NEC/Cabinet.

30. Having held that Mr Major did have authority to enter into the Agreement as agent on behalf of the Cabinet/NEC (a proposition never challenged by the Appellants), the Learned Judge then went on to find (at paragraph 64 of his Judgment): “In the result, I hold that Wendell Major was not a proper party to this action and he is hereby dismissed therefrom. As a consequence, all reliefs claimed against him as First Respondent are denied.” In so doing, the learned Acting Judge fell into error. As the pleadings make clear, Mr Major was sued in exactly the same capacity as that in which he entered into the Agreement, namely as secretary to the NEC/Cabinet. The learned Acting Judge held that Mr Major was acting in that capacity when entering into the Agreement as agent for the NEC/Cabinet: it follows that he can be sued in that capacity in these proceedings.

31. The learned Acting Judge went on to consider whether the NEC/Cabinet had acted ultra vires by entering into the Agreement as they purported to do. The learned Acting Judge rejected the Appellants’ submissions on this issue on the basis that the Agreement did not in fact confer any of the benefits alleged. He accepted the submissions of counsel for the Government Respondents (summarized at paragraphs 80 and 81 of the Judgment) that “it is only an agreement in principle that certain things are to be done. The Heads of Agreement does not, ipso facto, confer or grant any of the benefits alleged.” The learned Acting Judge went on to find (at paragraph 88) that “The Heads of Agreement is absolutely replete with conditions and reminders that all specific approvals must be applied for and all necessary agreements with specific Ministers entered into. And even if these conditions had not been so extensively spelt out, the parties to the Heads of Agreement must be taken to know the law in relation thereto and, even without spelling it out, the agreement would have to be read and understood in light of the existing law governing every aspect of it.”

32. The learned Acting Judge concluded his analysis of this issue at paragraph 92 of the Judgment as follows:

“In light of the overwhelming evidence that the Heads of Agreement is an agreement in principle, it is amazing that the Applicants can – to use that delightful Bahamian expression – “fix their mouth”, to make the claim that either the First Respondent or the National Economic Council has purported to confer specific benefits under the Heads of Agreement.”

The Agreement purported to confer rights on the Developers

33. With respect to the Learned Acting Judge, this finding wholly ignored the terms of the Agreement itself, and in particular the terms of clause 6 of the Agreement (which was nowhere mentioned or analyzed by the Learned Acting Judge in his Judgment). The Learned Acting Judge accepted that the Agreement was a contractually binding document: he relied, for example, on the fact that the Developers had given undertakings at clauses 3.1 of the Agreement to employ Bahamians in the Development (see paragraph 107 of his Judgment). Nowhere does the Learned Acting Judge analyse what consideration for these undertakings on the part of the Developers was provided by the Government under the Agreement. The answer is to be found in clause 6 of the Agreement.

34. Clause 6 of the Agreement is entitled “DEVELOPMENT PERMISSIONS AND CONCESSIONS”. This itself is an indication of the purpose of the clause. The clause then sets out the various permissions and concessions which are purportedly granted to the Developers under the Agreement. These may be summarized as follows:

34.1. Clause 6.1 of the Agreement purports to constitute an agreement to enter into the lease agreements under which the government land used for the Development is to be leased, and to grant the concessions available under the Hotels Encouragement Act, as follows:

“6.1 The Government, in consideration of the benefit that will accrue from the Development to The Bahamas generally hereby agrees to grant to the Developers in respect of the Development:

The Lease Agreements;

All concessions and exemptions available under the Hotels Encouragement Act (“HEA”) for new hotels constructed in the Family Islands including but not limited to the exemption from Customs duties and Stamp Tax on a pre-approved basis as provided for in the HEA; the items subject to such relief shall specifically include construction materials, furniture, fixtures and equipment required for construction, operation and equipping of all aspects of the Development related to the hotel/inn/villas, marina and the infrastructure necessary for such components of the Development, to the extent such development qualifies under the HEA; exemption from Real Property Tax as provided for in the HEA;

34.2. It can be seen that very substantial permissions and concessions are purportedly made under clause 6.1 of the Agreement. By clause 6.1(i) the Government has purported to contractually bind itself to grant 40 year Crown and Treasury land (148 acres) leases to the Developers to be used as part of the Development. It is pursuant to this clause that the Developers have been allowed to occupy and carry out extensive and physically and environmentally destructive works on those lands. That the Government’s own legal advisers consider that the Agreement constitutes a binding agreement to grant the leases is clear from the Affidavit of Deborah Fraser (served on behalf of the Government Respondents) at paragraph 4 [4/33/26] in which she states “To the best of my knowledge and belief, none of the leases of either the Crown or Treasury Land agreed to be granted in the Heads of Agreement … have been executed.”

34.3. The Appellants further submit that it is ultra vires the Cabinet or indeed the Minister to convey or lease Crown Land or for the Governor General or the Treasurer to lease Treasury Land other than for public purposes. The Appellants will rely on the Public Trust Doctrine set out in the case Mehta v Kamal Nath, WP 182/1996; 12.13 (The Beas River Case)

34.4. It can further be seen that clause 6.1(ii) purports to confer all concessions and exemptions available under the Hotels Encouragement Act. Again, this clause is not expressed to be subject to any qualification or proviso.

34.5. At clause 6.7 the government grants permission for the extension of roadways in relation to the Development and agrees to grant various easements to allow for their construction, in the following terms:

“6.7 The Government will permit the Developers (at their own expense) to extend the existing road that leads to the Settlement on Great Guana Cay so as to connect with the Southeastern boundary of the Development site. … The Government will also permit the Developers (at their own expense) to establish and pave roads located on the Remaining Treasury Land to provide unfettered access to the beach… The Government shall grant a temporary construction easement to Developer (sic) in order to complete the construction as described above.”

The evidence clearly disclosed that the Developers immediately bulldozed a road straight to the settlement. Despite request by discovery applications, letters and affidavits, there was no evidence of any permits. Certainly the evidence of the District Council was that no permits had been issued.

34.6. At clauses 6.11 the government grants permission for the Developers to conduct dredging for the Development in the following terms:

“The Government will facilitate permission for the Developers to extract (dredge), without charge, only that sand necessary for the Development from the Private Land or the Crown Land covered by the Marina Lease, with it being understood that in no event shall Developers have the right to sell any such sand.”

The evidence clearly disclosed that the Developers began dredging operations. There was no evidence of any permits. Certainly the evidence of the District Council was that no permits had been issued.

35. As was submitted to the learned judge, the rights granted under the above mentioned clauses are nowhere expressed to be conditional on any further approvals, grants or permissions. Further, the Developers have acted upon all of these grants and permissions. Thus, the Agreement directly led to very substantial works at the Development site and has already had a direct and substantial impact both on the local environment and the quality of life of the local residents (including the Appellants):

35.1. The Crown and Treasury Lands have been occupied by the Developers pursuant to the Agreement and works have been carried out on them (see photographs exhibited with the Third and Fifth Affidavits of Troy Albury at [2/21/7] and [4/39/65] and the Affidavit of Troy Albury filed on March 5, 2007 (6/56/255). Local residents have been excluded from those, formerly public, lands and the beach, and the works undertaken have had a major environmental impact already.

35.2. Roadways have been constructed and widened at the Development, leading to the destruction of mangrove and further environmental damages (see the photographs with Troy Albury’s Fifth Affidavit [4/39/71-110]).

35.3. Dredging has been undertaken by the Developers at the Development, leading to further environmental damage (see Troy Albury’s Fifth Affidavit [4/39/71-110]). As a result of these activities, there has been substantial beach erosion and environmental impact.

35.4. There has already been very substantial importation of materials and equipment for use in the Development subject to the exemptions conferred under clauses 6.1 (ii) and 6.2 of the Agreement.

36. The learned judge fell into error to find that the Agreement was of no effect. The Agreement conferred real rights on the Developers; those rights were acted upon; those actions had an immediate and detrimental effect to the environment and local residents of Guana Cay. Indeed the Developers gave evidence (Mr. Arenson’s 2nd affidavit [1/17/411]) to the effect that they were, before the undertaking, spending over $700,000 a month on the Development. That was at a time when no permits or other licenses had been issued by Ministers or the local council, other than the Agreement. The evidence was overwhelming that substantial work was being done pursuant to the Agreement.

37. The learned judge’s finding can be simply tested in this way: if the Agreement grants no rights, what is its purpose; why were the Developers already spending vast sums undertaking the Development; why were the Developers so desperate to defend it in these proceedings; and why have the Developers so strenuously resisted an injunction, saying that any such injunction would harm the progress of the development? It is submitted that all of this should have demonstrated very clearly to the judge that in reality the Agreement is far from being merely an “agreement in principle” as the court found, and purported to confer substantive “permissions and concessions” under clause 6. The question therefore arises (which the Learned Acting Judge did not consider) whether the Cabinet/NEC was lawfully able to confer those permissions and concessions, or whether it was acting ultra vires in so doing.

The Agreement was ultra vires

38. The permissions and concessions purportedly conferred under clause 6 of the Agreement were not ones which the Cabinet/NEC had power to grant. The following examples were submitted to the Learned Acting Judge, but were not addressed in his Judgment:

38.1. As regards the agreement to grant leases of Treasury lands, the power to grant leases of such lands is prescribed by the Ministry of Finance Act, Chp. 23, at s. 5. This provides in material part as follows:

“5(1) Where, by an Act or otherwise, any land is or becomes vested in the Treasurer, he shall, subject to any express provision to the contrary contained in any Act, hold the land in trust for Her Majesty in right of Her Government of The Bahamas for the public purposes of The Bahamas.
(3)Notwithstanding the other provisions of this section-
(b) neither the Treasurer nor any Minister or officer to whom the Treasurer may have delegated powers under subsection (2) of this section shall lease any land vested in the Treasurer or grant any licence to occupy any such land for a term exceeding three years without the prior approval of the Governor-General.”

No approval from the Governor-General was received. The agreement to enter into the lease (which was for 40 years) was unlawful. Further, the land is held in trust for the “public purposes of the Bahamas”. Granting a lease to foreign Developers is far from using the land in a manner consistent with its being held “in trust for the public purposes of the Bahamas. In fact, given its effects on the local environment and population, it is quite the opposite.

38.2. It was further submitted that this statutory position is a reflection of the general doctrine that public lands are held on trust for the public benefit. They are certainly not held on trust for the private profit of foreign Developers. The Learned Judge failed to address this issue, as he failed to address or understand many others raised for decision by the Appellants.

38.3. Many of the approvals and permissions purportedly granted by the “NEC” or the “Government” under the Agreement are vested in the District Council or local government boards. These including the following powers:

Town Planning permits. Under s. 14(1)(iii) of the Local Government Act, Chp. 37 (“the LGA”), the District Council (through appointed boards) exercises the functions of a Town Planning Committee under the provisions of the Town Planning Act, Chp 255 (“the TPA”). These functions include considering, approving or rejecting applications for the erection on, alteration of or change of use of any building or land (s. 7 of the TPA). Thus, the purported grant of the approval to build roads and change the land use contained in the Agreement was not lawfully given.

Building Permits. Under s. 14 (1)(b) of the LGA, the District Council has and exercises in relation to its district the powers of the Building Control Officer to grant building permits under the provisions of the Buildings Regulations Act (“the BRA”). These functions include the granting or withholding of building permits in respect of all building operations, and under s.4(1) of the BRA, no person is permitted to carry on any building operation save in accordance with a valid building permit granted in this way.

Port Authority Permits. Under s. 14(1)(iii) of the LGA the District Council (through appointed boards) is assigned the powers exercisable by a port authority under the Port Authorities Act, Chp. 269 (“the PAA”). This includes the power to define the limits of the harbours and anchorages within its local port area, and various ancillary powers, under s. 13 of the PAA. Thus, the purported grant of approval for a marina and dredging contained in the Agreement was unlawful.

- Hotel Licenses. The District Council also has the powers of the Hotel Licensing Board to grant or refuse hotel licenses under the Hotels Act (see s. 14(1)(a)(iv) of the LGA). Thus, the purported grant of the various concessions and exemptions under the HEA in the Agreement was unlawful.

39. By clause 6 of the Agreement, the national government sought wholly to bypass and usurp the function of the local government and arrogated to itself the powers conferred by Parliament upon the local government. Given the strident local opposition to the Development, this unlawful arrogation of powers has had the effect of allowing the Development to proceed in the face of near uniform local opposition, and rendered the local council powerless. Such an approach is wholly unlawful, undemocratic and wrong.

40. It is respectfully submitted that the Respondents cannot be permitted to do indirectly what they cannot do directly. The Appellants are entitled to the protection of the law which includes the Public Trust Doctrine, the Financial Principle of the Constitution and Separation of Powers Doctrine. It is submitted that the approach adopted by the agreement is an attempt to get around the aforesaid doctrines and protection of the law. The Appellants rely on Inland Revenue Commissioner and Attorney General v Lilleyman and Others (1964) 7 WIR 496

41. In relation to the 1st to 4th grounds, it is submitted generally that the Executive Branch of the Government, from the Cabinet, the NEC or Mr Major cannot lawfully create bodies and processes which are entirely outside of any statutory framework permitting this kind of Agreement which purports to “cut through the red tape and roll out the red carpet”. Such a process and Agreements by its substance and form seeks to sidestep compliance with legislation and which avoids the Separation of Powers Doctrine and the Financial Principle of the Constitution. The Executive can only lawfully act within its powers and in accordance with the Financial Principle of the Constitution.

42. It is respectfully submitted that Parliament, not the Executive, decides by legislation who to tax and/or not to tax. Only Parliament can lawfully authorize a waiver of taxes. This is not a matter for Cabinet, Mr. Major or the NEC. It can only be done in accordance with statute, that is, through an agreement, for instance, under the Hotels Encouragement Act not through the Agreement. The Appellants will rely on the cases of Deal and Others v Minister of Foreign Affairs and Others, 23 of 2004, Supreme Court Decision of Isaacs J. and Minister of Foreign Affairs and Others v Roberts and Others, Constitutional Appeal No. 42 of 2005, Mackay v Attorney General British Colombia [1922] AC 547.

43. In summary, then, the Learned Acting Judge ought to have found in law, that by the Agreement the First Respondent acting as secretary to the National Economic Committee (and, he says, thus as secretary to the Cabinet) was purporting to exercise powers which neither he, nor the cabinet, nor indeed any of the members of the cabinet, actually had under law. The Learned Judge ought to have therefore found that the Agreement was thus entered into ultra vires.

Ground 2: Fettering discretion

The issue

44. It is a well established principle of public law that a decision making body may not improperly fetter its own decision making discretion. This principle was summarized in Birkdale District Electricity Supply Co v Southport [1926] AC 355 in the following terms (at page 364):

“[I]f a person or public body is entrusted by the Legislature with certain powers and duties expressly or impliedly for public purposes, those persons or bodies cannot divest themselves of these powers and duties. They cannot enter into any contract or take any action incompatible with the due exercise of their powers and duties.”

45. The Appellants submit that in entering into the Agreement the First Respondent (on behalf of the Cabinet/NEC) fettered the discretion of the Ministers charged with making the relevant decisions concerning the Development, and that of the local council.

The Judgment

46. The Learned Judge dealt with this ground briefly from paras 164 – 179 of his Judgment [5/45/102-106]. At para 179, he found that “…entering into the Heads of Agreement by the Government has not and need not fetter the discretion of any person or body that has or will be called upon to exercise such discretion when the appropriate applications are presented to them for consideration”.

The manner in which discretion was fettered

47. Respectfully, the Court erred in this finding. The Agreement has fettered the discretion of the relevant decision making bodies in two ways:

47.1. First, because of the substantive rights that have been purportedly granted, the relevant decision-making bodies have been left with relatively little choice but to grant the necessary approvals and permits.

47.2. Second, because by clause 6.8 of the Agreement the government undertakes in effect to fast-track the requisite approvals, without due and proper consideration or consultation.

48. As regards the first of these, it is evident that the approvals which the government has already purportedly granted in the Agreement (such as the dredging approval, lease approvals, road building approvals and import approvals) have meant that the nature of the land use at the Development site will (unless restrained) be irreparably changed even if no other approval is ever granted. The works that have been carried on already, solely on the basis of the Agreement (no other permits having been granted) have had an enormous impact on the site, the local environment and the local people. In those circumstances, the relevant decision-making bodies are being presented not with the option of preserving the Cay as it is, or accepting a substantial new Development; rather, they are being presented with the decision between a partially completed Development, and a completed one.

49. In short, the government and the Developers are attempting, through the Agreement, to present the proper decision-making bodies with a fait accompli. It is clear that this is how the District Council felt (one of the relevant decision-making bodies) from the Affidavit of Walter Sweeting and his letters the government exhibited with Troy Albury’s Third Affidavit. This conduct is plainly incompatible with “the due exercise of their powers and duties.”

50. This is of particular significance in circumstances where there has been a change of government since the Agreement was signed. It may well be that the new government, and the individual Ministers of that government charged with the granting of the necessary approvals and permits as remain to be obtained in order for the Agreement lawfully to proceed, would not wish for the Development to proceed. However, given the various permissions and concessions purportedly granted under the Agreement, and the Developers’ actions under them, the new Ministers’ power to refuse such permits and halt the Development would be severely fettered were the Agreement to have lawful effect.

51. As regards the second issue, the Agreement is replete with undertakings and assurances that the requisite approvals will be granted, and clause 6.8 makes plain that such approvals will be fast-tracked.

52. The Appellants will rely on the cases of Rederiaktiebolget Amphitrite v R [1921] AER 542 at 544 A-E; Commissioner of Crown Lands v Page [1960] 2QB 274 at p 291; Revere Jamaica Alumina v Attorney General [1977] 26 WIR 486, at p 487 g to j and 488 f to end of page 488, 489 g to end of 489 and 490 d to 491 a; State of South Australia v Commonwealth of Australia (1961 – 62) 108 CLR 130; Stuart v National Water Commission (1996) 54WIR 287 pages 309 c – d, 310 g, 313 d to end of page 313 and 314 d to 315 f; and Commercial Cable Company v Government of Newfoundland [1916] 610

Ground 3: Irrationality/unreasonableness

The issue

53. The third ground of review advanced by the Appellants below, was that no reasonable decision making body in the position of the Cabinet/NEC could have entered into the Agreement. The reasonableness test was explained by Lord Wrenbury in Roberts v Hopwood [1925] AC 578 (at page 613) as follows: “A person in whom is vested a discretion must exercise his discretion upon reasonable grounds… he must, by use of his reason, ascertain and follow the course which reason directs. He must act reasonably.”

54. The Appellants submit that, even if (contrary to the above) the Cabinet/NEC had the power lawfully to enter into the Agreement as they did, their decision to do so and, in particular, their decision to approve the Development in principle, was one which no reasonable decision making body could reasonably have come to in the circumstances.

The Judgment

55. The Learned Acting Judge dealt with this ground of review from paragraphs 98 to 163 [5/45/76 onwards]. He correctly found that irrationality in arriving at a decision was a ground for review.

56. The Learned Acting Judge wrongfully rejected this ground of review. He appeared to do so for the following reasons:

48.1 Observing that the government had required an environmental impact assessment to be done, the Learned Acting Judge held that “the Government having required such an assessment to be done and the Developers having gone to the obvious great expense to do it, neither of them could reasonably be accused of not being concerned about the environmental effects that might result from such a development”. Respectfully this is not sound reasoning and it was in any event contrary to the evidence. The fact that an EIA was commissioned (and, particularly, commissioned from the Developers themselves, who would hardly be likely to present an unbiased viewpoint) does not indicate that the decision to enter into the Agreement was a reasonable one.

48.2 He acknowledged the Appellants’ submissions that the conclusion (at recital J of the Agreement) that it was in the best economic interests of Abaco to permit the Development was unreasonable. However, he concluded (at paragraph 105) that the Appellants had produced no evidence to support their assertions in this respect. In so concluding he was in error, for the reasons set out below.

48.3 He also appeared to conclude that the BEST Commission had given its blessing to the project and thus it must be environmentally sound.

57. For the reasons set out below, none of these conclusions of the Learned Acting Judge was sound and none of them formed a proper basis for finding that the decision to enter into the Agreement was a reasonable one.

The entry into the Agreement was unreasonable

58. Whilst the Appellants appreciate, as the Learned Judge found, that he should not substitute himself as the decision maker, had the judge taken into account the evidence, permitted the Appellants the opportunity to cross examine the Developers and Respondents’ deponents and allowed discovery, the Learned Judge would have found, based on the evidence, that no rational body could have reasonably made the decision to enter into the Agreement for the following reasons, amongst others.

59. The Learned Judge simply did not deal with a wealth of evidence demonstrating this and misunderstood many of the issues. The Judge failed to critically consider the evidence that the economy of The Bahamas, the Abacos and importantly of Great Guana Cay would not be positively and significantly impacted. At paragraph 105, the Judge finds incorrectly, that “there are very positive assertions but there appears no evidence to support them.”

60. Respectfully, the Learned Judge failed to have regard to the Agreement itself, and the evidence of the Appellants in the following respects:

51.1 150 acres of Crown and Treasury Lands were being given away at a nominal price which remains a mystery;

51.2 Given the scale of the Development and the small scale of suppliers in Marsh Harbour, almost all materials and supplies would have to be imported directly from abroad;

51.3 Given the scale of the Development, in order to achieve it in a reasonable time frame large numbers of temporary workers from abroad would be required and that simply the craftsmen and skilled labour force in the Abacos was already saturated with work and would not be able to fulfill the demand;

51.4 By virtue of the intended exclusive nature of the development and the expensive cost of acquiring land or boat slips in the marina, Bahamians would not be able to afford to live in the Development and would effectively become foreigners in their own homeland, excluded therefrom by a gate resulting in foreseeable negative social and economic effects (para 108). Even the Judge expressed grave concerns about this at paras 128 to 144 where he said at page 242, “The effect would be to create a foreign enclave and very effectively to divide the island both physically and psychologically…It appears to me that the creation of this kind of enclave poses this kind of danger”.

51.5 The steady and manageable pace of the economy of Guana Cay would be completely disrupted;

51.6 The evidence of long term catastrophic terrestrial and marine environmental damage was overwhelming and unchallenged. The Appellants relied not only on the evidence of their own expert, Dr. Risk, but most importantly on the evidence of the Developers own expert as contained in the EIA. Thus the Learned Judge was clearly in error when he found, at para 114, that “There appears to be no factual basis for the Applicant’s claim that ‘the development presents grave environmental and public health dangers (as appears from the HOA) have simply not been considered by the Government.”

61. The Learned Judge appears to have completely misunderstood the rationale for an EIA and its process and he began to fall into error at para 115 when he found that “In fact, by the time the Heads of Agreement was entered into the Developers had already at their expense, caused the environmental study to be done”. The Judge appears to have considered firstly that an EIA is an end in itself and that because it pre-dated the Agreement, it somehow provided support for the decision. Respectfully, to adopt this approach is to miss the point. An EIA is an iterative process necessarily involving stakeholders to give it legitimacy as the EIA itself made plain. The fact that an EIA (proper or otherwise) has been concluded is not a logical basis for a decision to enter into the Agreement, particularly, if one had regard to the contents of the EIA. The fact that an EIA is commissioned is evidence of nothing: it is the contents of the EIA, and how they are responded to, that evidences whether or not the decision to embark upon a project is a rational one or not.

62. At paras 117 to 120, the Court criticized the Appellants for listing a “litany of negatives selected from the” EIA and then referred extensively to the Respondents’ submissions that the Court should have looked at the contents of the EIA which presented “suggestions for mitigating or minimizing” the negative impacts. Respectfully, this is to miss the point. The evidence relied upon by the Appellants did demonstrate beyond a reasonable doubt that “the proposed development threatens to cause major environmental and ecological damage.” (para 117). The Learned Judge failed to understand that references to mitigation by the Respondents only served to underscore the unquestioned damage in the first instance. Thus, he ought to have found that it was irrational to approve a Development that would have such negative environmental impacts in such a “pristine” location, especially because much of the damage would occur on Crown and Treasury Land, which was to be held for public purposes, and was land traditionally used by the residents of Guana Cay, the Appellants, for crabbing, fishing, hunting, pleasure and recreation.

63. Further, the Court respectfully failed to appreciate that it was irrational to grant customs duty, hotel tax, real property tax and stamp duty, concessions when the entire economy of the rest of the island depended on those taxes being collected, as they had been from all other homeowners and businesses on Guana Cay especially when certain of the relevant legislation required 50% thereof to be spent on infrastructure improvement and maintenance on Guana Cay. The Court appeared, at para 160, to assume that such concessions were “run of the mill, incentives employed for many years to encourage investments”, irrationally adopting the view that “investment”; “development” at all costs, was a sufficiently legitimate end to every means and did not take into account the economic needs of the Guana Cay settlement, nor their heritage, traditions, culture, way of life and importantly, relationship with a “pristine” marine and terrestrial environment.

64. Consequently, it is respectfully submitted the Court fell into error in finding that “the Government was not guilty of unreasonableness”

Ground 4: no meaningful consultation

The right to consultation

65. The final ground of appeal is that there was no meaningful consultation with the local community on Guana Cay by the central government prior to the entering into the Agreement.

66. The learned Judge rightly found that the Appellants had a right to be consulted on the proposed development prior to its approval by the Agreement. However, the Developers have sought to challenge this finding, and appear to assert (at paragraph 2 of their Respondents’ Notice [5/54/248]) that the local community had no right to be consulted concerning the Development. It is thus necessary to address this issue.

67. The learned Judge held (at paragraph 194 of the Judgment [5/45/109]) that “the proposed development will definitely affect the landowners and residents of Guana Cay, whether for good or ill remains to be seen. They are, therefore stakeholders…” He correctly found further at para 195:

“There is no doubt in my mind that, sitting as they do as stakeholders in the welfare of Guana Cay and as landowners and residents thereof, the Applicants had a right to be consulted…”

68. Again, at para 196-198, the Learned Judge correctly found

“…the landowners/residents of Guana Cay had a reasonable, legitimate expectation to be consulted, advised, given details of, a development that would no doubt change everything about the Cay and their way of life forever…”

“Such a right need not be based on a promise by a relevant Government official; nor need it be based on a regular practice…the people of Guana Cay were entitled to be consulted…It is obvious that the Bahamian Government thought the people of Guana Cay ought to have been consulted in this matter as well.”

69. It is respectfully submitted that the learned Judge was right to find that the Appellants (together with all the residents and landowners of Guana Cay) had a right to meaningful consultation in relation to the Development. The public law right to proper consultation can arise in one of two ways:

61.1 First, it can arise as an incident of the general duty on public bodies to act in accordance with principles of procedural fairness. This was made clear in the decision of the House of Lords in R v Commission for Racial Equality ex parte Hillingdon London Borough Council [1982] AC 779 (per Lord Diplock at 787F) as follows:

“Where an Act of Parliament confers upon an administrative body functions which involve its making decisions which affect to their detriment the rights of other persons or curtail their liberty to do as they please, there is a presumption that Parliament intended that the administrative body should act fairly towards those persons who will be affected by their decision.”

That the requirements of fairness extend to the need for public consultation (particularly in relation to substantial infrastructure developments) was made clear by Lord Diplock in Bushell v Secretary of State for the Environment [1981] AC 75 at page 96. The Appellants therefore submit that there was a free-standing public law right to proper consultation in relation to the proposed Development prior to the entry into of the Agreement.

61.2 Second, the right to consultation can also arise as a result of a legitimate expectation given rise to by representations made on the part of the decision making body, or its prior conduct. It is clear that such expectations may be given rise to by the statements or conduct of the relevant public officials or bodies. In A-G for Hong Kong v Ng Yuen Shiu [1983] 2 AC 629 (House of Lords) Lord Fraser held as follows:

“The expectations may be based upon some statement or undertaking by, or on behalf of, the public authority which has the duty of making the decision, if the authority has, through its officers, acted in a way that would make it unfair or inconsistent with good administration for him to be denied such an inquiry.”

70. In the present case, the Appellants submit that the right to consultation arose on both these bases. The impact of the proposed Development on the island of Guana Cay is very substantial and it would be extraordinary if, in exercising any powers purportedly conferred upon them to permit the Development, the government were not under an obligation properly to consult with those whose lives will be so drastically affected. Further, and in any event, the conduct of the former central government was such as to give rise to a clear legitimate expectation of proper consultation in respect of the Development, as follows:

70.1. Express representations were made by the representatives of the Government and, in particular, by Minister Maynard Gibson, that there would be proper consultation.

70.2. Further, the expectation of proper consultation arose as a result of the conduct and practice of the government in relation to other proposed major developments and environmental issues.

71. As regards the first of these matters, this is set out in Walter Sweeting’s Affidavit and can be summarized as follows:

71.1. Mr. Sweeting (the Chief Councillor of the District Council at the time the Agreement was entered into) makes clear that he raised, on behalf of the Council and the people of the Cay, the concerns about the proposed development and the need for proper and full public consultation on the island before any Heads of Agreement was entered into

71.2. He further gave evidence that he was expressly promised by Minister Maynard Gibson in August 2004 that the negotiations with the government were at the infancy stage and that there would be further town meetings to discuss the development, at which she would be present.

71.3. In fact, he states, there were no further meetings in Guana Cay concerning the Development (either before or after the Heads of Agreement was signed) and no further public consultation.

72. The people of Guana Cay were, in short, promised by the relevant Minister that there would be proper town meetings and public consultation prior to the Heads of Agreement being signed. They had a legitimate expectation of such meetings and consultation taking place. There were none. The legitimate expectation was broken. The Learned Judge simply did not deal with this issue.

73. The other basis on which a legitimate expectation of public consultation can be said to arise in this case is from the prior and stated practice of the government in relation to such developments:

73.1. The Applicants led evidence to show that it is usual for there to be extensive consultation as part of the environmental review process in such cases. There was no such consultation here.

73.2. The Government’s own publicly produced policy documents state that there is to be such consultation. This is set out in Troy Albury’s Fourth Affidavit, and referred to as the Strategic Plan for Investments in the Bahamas.

73.3. The expectation of consultation is particularly significant and reasonable in the circumstances of this case. Guana Cay is a small island. The proposed Development (which will cover a substantial portion of the physical space on the island) will, if allowed to proceed, as the Learned Judge found, change the nature of the island for ever and have an enormous impact on the local residents. In such circumstances, it would be extraordinary if there was not some reasonable expectation on the part of those residents that they would be properly consulted.

74. In summary, it is clear (as the learned Judge found) that the residents and landowners of Guana Cay were entitled to be consulted regarding the proposed Development before it was approved and the Agreement entered into by the Government.

75. The learned Judge declined to uphold this ground of review because he found the right to consultation had been met in this case. The Appellants submit that the learned Judge erred in so finding.

No proper consultation

76. In order for the right to consultation to be meaningful, proper consultation has to take place. What is required by proper consultation was summarized by Lord Woolf in R v North and East Devon Health Authority ex parte Coughlan [2000] 2 WLR 622 at paragraph 108 as follows:

“To be proper, consultation must be undertaken at a time when proposals are still at a formative stage; it must include sufficient reasons for particular proposals to allow those consulted to give intelligent consideration and an intelligent response; adequate time must be given for this purpose; and the product of consultation must be conscientiously taken into account when the ultimate decision is taken.”

77. It is submitted that the level of consultation properly to be undertaken, and the level of information properly to be provided, is proportionate to the impact of the proposed decision on those to be consulted. In the present case, as the learned Judge himself rightly found, the impact of the decision to permit the Development on the lives of the residents and landowners of Guana Cay was likely to be enormous, with the Development taking up over a third of the Island, vastly multiplying its population, and having a proportionate impact on its eco-system and economy. It is thus submitted that the level of consultation and involvement of the local community in the decision making should have been correspondingly substantial.

78. In fact, none of the requirements for proper consultation was met in this case. Indeed, there was evidence before the Court (not referred to by the Learned Acting Judge) that the government had adopted a deliberate policy of non-consultation prior to entering into the Agreement. This was shown by the comment made at page 48 of the EIA, which stated as follows:

“Without an official approval of the [project] from the Office of the Prime Minister, PPS has not been allowed to publicly present information about the development plans and solicit input from the community.” (emphasis added)

79. The EIA further stated at page 119 as follows:

“At the time of EIA preparation [the Developers] have not had the opportunity to begin a public consultation process. Public discussion of the project has been discouraged prior to final approval through the Office of the Prime Minister.” (emphasis added).

80. These statements in the EIA (which was prepared on behalf of the Developers) make clear that public consultation was actively and deliberately discouraged prior to a final approval of the Development being granted. In other words, the Developers were informed by the government that public consultation should only take place after the decision to approve the Development had been made, not prior to the making of that decision. In those circumstances it is absolutely plain that no proper consultation can have taken place: the government proposed to make its mind up about the development first.

81. The learned Judge based his finding that there had been meaningful consultation prior to the signing of the Agreement on a chronology of events set out at paragraph 202 of his Judgment [5/45/111]. In particular, he concluded that there had been proper consultation on the basis that there had been three meetings held with local residents concerning the Development. Indeed, these were the only instances in the chronology set out by the Learned Judge where it could arguably be said that there was any direct exchange between the Government and residents or landowners.

82. The learned Judge makes much of these meetings with local residents. The learned Judge erred in finding that there had been three meetings: in fact, as was common ground, there were only two (one in February 2005 and one in August 2005). Further, the learned Judge failed to make any reference to the evidence of Walter Sweeting, the Chief Councillor of Hope Town District Council in the Abacos, the District Council for Guyana Cay (that Affidavit is at [2/23/118-127]). That Affidavit is the only independent evidence available to the Court of what happened at the meetings, and it is of very considerable significance.

83. In his Affidavit, Mr Sweeting states the following concerning the first of the two meetings (from paragraph 7 onwards):

“7. Sometime in February of 2004, the Senior Island Administrator, Mr Alexander Williams, told me that he had been instructed to hold a meeting in Great Guana Cay and asked me if I could facilitate a town meeting in Great Guana Cay at the instance of the District Council to discuss the Passerine Project [i.e. the Development].

8. By that time, no members of the Government or any representatives had met the Hope Town District Council or provided any information to the District Council with respect to the Passerine project.

9. The only information which I had regarding the project was what was generally out there. No governmental agencies had provided the District Council with any information to share with the Great Guana Cay residents.

10. In February 2004, a town meeting was held in Great Guana Cay. It was not a productive meeting. There was little information to provide to the residents of Great Guana Cay. The Administrator merely repeated the information which was generally rumoured regarding the proposed development.

11. Mr Williams emphasized that the project was only in its infancy stage and that he had been asked by the Government to tell the people of Great Guana Cay about the project and to just get their views on it.

12. Administrator Williams explained that there would be further follow up meetings in which the project would be detailed and opportunities provided to the residents of Great Guana Cay to give their input.

13. He also said that more information would be shared with them. He stated that the developers and governmental agencies would have follow up meetings. He also emphasized that this meeting was just an introduction to tell people that there was an intention to develop a project there in Great Guana Cay.

14. The conclusion of that meeting was that the Government and the Developers would be coming to Great Guana Cay to conduct dialogue and meetings with the public.

84. Mr Sweeting goes on to discuss the other meeting which subsequently took place at paragraphs 15 to 25 of his Affidavit, as follows:

“15. Subsequently, Minister Allyson Maynard-Gibson, the Minister of Financial Services & Investments, proposed to have a meeting with the Hope Town District Council and a select number of Great Guana Cay residents along with members of her delegation at Orchid Bay in Great Guana Cay. She told me this was not to be a town meeting.

16. In any event the intended meeting did not take place as she cancelled out of the meeting.

17. Subsequently, there was a meeting introduced by Administrator Williams with Mr. Baltron Bethell in attendance who then conducted the meeting. Surprisingly, I was not invited to that meeting, nor were any other members of the District Council.

18. That meeting had nothing to do with the Hope Town District Council. Even though I was not invited I did attend.

19. That meeting occurred on Great Guana Cay on Friday, August 20, 2004.

20. There were 3 or 4 other persons from the Government along with Mr Fred Gottlieb, the Attorney for the Developers, and representatives of the Developers.

21. The Developers made a full presentation of their proposed development and the different aspects of the proposed development were commented upon by residents of Great Guana Cay and the Developers and Mr. Bethell’s delegates took note of those concerns.

22. One popular concern was the beach access issue, and the Developer indicated they would move it from the North to the South side as suggested by the residents.

23. The Golf Course, Crown and Treasury land, Marine, Joes Creek and Wetlands issues were hard and sticky issues.

24. No changes were proposed by the Developers or the Government regarding those issues.

25. At that meeting Mr. Bethell said that there was further information from the Developers which the Government required about the project. He said that he heard the concerns of the residents and he would take them to the Government. He left me with the impression that there would be another meeting in Great Guana Cay at which the Minister would be in attendance.

85. In fact, as Mr Sweeting makes clear, there were no further meetings held concerning the Development and no further information was provided as had been promised. This was despite an express promise from Minister Maynard-Gibson, as explained by Mr Sweeting at paragraph 26-36 of his Affidavit as follows:

“26. On Monday August 23, 2004, Minister Allyson Maynard-Gibson called me. She asked me if I had been present at the meeting and I confirmed to her that I was …

27. Having told her the concerns of the residents of Great Guana Cay, I then said to her that I felt that she fully owed it to the people of Great Guana Cay to come to Great Guana Cay to hear their concerns directly. She and I had a discussion. She also apologized for not making it to the meeting and she wanted me to share that with the community.

28. I particularly remember her stating and emphasizing “let me assure you Chief Councillor, this is just the infancy stage and before any Heads of agreement is signed, I would have personally come to Guana Cay just like I did in Cherokee Sound and hold a town meeting and meet with the people.” I wrote that down in my notes made immediately following the conversation and I conveyed that to the residents of Great Guana Cay and everyone who called me about it.
…
33. I understood from her comments that there would be further town meetings where the concerns of the residents of Great Guana Cay could be addressed especially since she had stated that the development was in its infancy stages.

34. Certainly, I expected, as had many of the residents of Great Guana Cay, that there would not be any Heads of Agreement signed until those meetings had occurred.

…

36. Since that conversation, there have been no such meetings in Great Guana Cay.”

86. It is clear from the above that the supposed process of “consultation” which the learned Acting Judge held to have been adequate amounted to the holding of two meetings, in the first of which no information was supplied concerning the proposed Development, and in the second of which the local council was not informed beforehand that it was taking place, and none of the concerns raised in the meeting was addressed. In neither of those meetings did any Government Minister or member of the NEC attend to hear the concerns. Thus, none of the persons who took the decision to enter into the Agreement had met with the residents of Guana Cay or heard their comments and concerns.

87. Further, as appears from Mr Sweeting’s Affidavit, there were clear promises made of additional meetings, which would be attended by the relevant Government Minister, and of the provision of additional information, prior to any Agreement being entered into. Indeed, the project was described as being in its infancy stage. Those promises were not kept. There was no further consultation and no further information was provided before the Agreement was entered into. All of this evidence was simply overlooked or ignored by the learned Acting Judge.

88. The learned Acting Judge also made reference to various letters, reports and petitions submitted to the Government by the residents and landowners of Guana Cay to suggest that there had been adequate consultation. In fact, this evidence demonstrates that the Government did not engage in any consultation process at all:

88.1. The learned Acting Judge makes reference to the various letters sent by the Appellants to various ministers. What the learned Judge overlooked is that these letters got no substantive reply. The Appellants wrote over a dozen letters (exhibited with Troy Albury’s Fourth Affidavit) to the relevant Ministers and have received only a single reply from only one Minister (which simply stated that he was not dealing with the issue). There has been no reply from any of the other government departments whatsoever. Not only is this deeply discourteous, but it suggests a total unwillingness to engage with the residents of the Cay on this issue.

88.2. The Appellants wrote to the BEST Commission seeking involvement in their review process. Again, they received no reply to their letters (see Troy Albury’s Fourth Affidavit).

88.3. The Chief Councillor of the relevant District Council wrote to the Senior Administrator (letter exhibited with Troy Albury’s Fourth Affidavit) stating:

“It appears that an overwhelming majority of the residents of [Great Guana Cay] are vehemently against the project and thus do not wish approval to be granted either for a golf course or a marina of the size planned by [the Developers]. Nor do they wish to relinquish any rights that they may have as Bahamians to the future utilization of Crown and Treasury Land that is planned as a portion of this development.

In our experience with this project, all major decisions seem to have been made and are still being made by representatives of Central Government with absolutely no knowledge or consultation with our Council. It would appear that the only reason we are now, after the fact, being asked to become involved at all is due to the pending lawsuit [ie this action]”

As this letter makes very clear, every attempt has been made by the Respondents and the Developers to by-pass the local council and local residents in relation to the Development.

88.4. The residents have made their feelings on the Development very plain. They produced to the Government a petition, signed by almost all the residents on the Cay in opposition to the Development. This was simply ignored by the Government and no reply or acknowledgment was given.

88.5. Neither the residents nor the District Council was ever given access to copies of the Heads of Government prior to its being executed, and no comments were invited or received on the document.

89. It is submitted that, in the above circumstances, no proper consultation took place prior to the signing of the Agreement and this ground of review is fully made out.;

90. The Appellants rely on the case of Belize Alliance of Conservation Non-Governmental Organizations v Department of the Environment [2004] 3LRC94 (“the Belize case”). The Respondents also rely on this case. The analysis of this case will be dealt with in two sections.

91. The first section considers the important ways in which the issues in the Belize case differ from those in the presence case and, thus, why it is not a useful authority for the Respondents.

92. The second section illustrates various of the points made in the Privy Council judgments which support the grounds of review being pursued in the present case and, thus, show why in fact the Belize decision is a useful authority for the Appellants.

93. Differences

93.1. The challenge in the Belize case focused on the adequacy of the EIA that had been prepared in that case. The grounds were set out at para.30 of the PC judgment, namely: (i) that the EIA did not comply with the statutory scheme; (ii) that it was irrational for the Department of the Environment (“DOE”) to treat the EIA as an adequate basis for approving the project; and (iii) that there was bias on the part of the National Environmental Appraisal Committee (“NEAC”) in recommending the project to the Department (though this last ground was abandoned on appeal).
93.2. What is clear is that in the Belize case there was no suggestion that the body that made the decision to approve the project (i.e. the DOE) did not have the power to do so; nor was the court invited to decide whether it had made the right decision (i.e. whether the approval of the project was irrational per se) - see para. 10 in the Belize case. The question was one of pure procedure.

93.3. Thus, none of the central issues raised in the present case were raised or addressed in the Belize case. In the present case, a challenge is being made (i) as to the power of the decision making body (i.e. the NEC/Cabinet) to make the decision it purported to make in entering into the Heads of Agreement; and (ii) as to the rationality of the decision to enter into the Heads of Agreement and grant approval for the project per se. In particular, none of the issues concerning the power to dispose of Crown and Treasury Lands, and none of the issues concerning the powers of the District Council, arose in the Belize case as they do in the present case.

93.4. In addition, two further central issues arise in the present case which simply did not arise in the Belize case, namely (i) whether, in entering into the HOA, the Government was fettering the discretion of the relevant decision-making powers regarding the issuing of necessary permits; and (ii) whether the legitimate expectation of public consultation has been met.

93.5. In short, in the Belize case it was accepted that the DOE had the power to approve the project, and that the NEAC had power to make recommendations – the only issue being whether the recommendation and approval was possible given the alleged deficiencies of the EIA. In the present case, the central issue is whether there was power in the NEC to give approval at all (not simply whether proper procedures had been pursued), and whether it would be rational for the proposed project to be approved at all, irrespective of the contents of the EIA.

93.6. It is also important to distinguish between the interests engaged in the Belize case, and those involved in the present case. In the Belize case, the only issue was the environmental one; the Applicant in the Belize case represented the various relevant environmental organizations. There was no challenge to the project by the affected residents (no doubt because, as the dam was to be built in the middle of the jungle, there were no affected residents). In the present case, there are large numbers of affected residents, and they are represented by the Appellants.

93.7. The only issue where there is any possible overlap between the cases is the issue in the Belize case of whether it is improper for the NEAC not to have held a public hearing after receiving the EIA but before making its recommendation to the DOE (see para. 30 and para 74). However, insofar as there are parallels with the present case, they support the Appellants.

93.8. It is clear that the proposed scheme in the Belize case had received enormous publicity and that there had been “widespread consultation”, including such consultation in the preparation of the EIA (see para.75.)

93.9. In the present case, there has been little or no consultation and there was absolutely no public consultation as part of the process of preparing the EIA – indeed this is one of the grounds of review.

93.10. The Privy Council accepted (in both the majority and minority judgments) that it was necessary that an EIA alert the decision makers and the members of the public to the environmental and community consequences of the proposed development (see the Prineas v Forestry Commission case cited with approval at para 69 in the Belize case). In the present case, the EIA has not even been released to the public.

93.11. The decision in the Belize case was limited to a review of whether the EIA had been properly prepared and whether its acceptance by the NEAC and the DOE was rational. The ambit of review was thus vastly narrower than in the present case and none of the same issues was engaged.

93.12. The decision in the Belize case was limited to a review of whether the EIA had been properly prepared and whether its acceptance by the NEAC and the DOE was rational. The ambit of review was thus vastly narrower than in the present case and none of the same issues was engaged.

93.13. A further important distinction is that it was made very clear in the Belize case that no issues of a constitutional or human rights nature were being engaged. (see para. 9). This differs from the present case, where it is argued that such issues are engaged, in particular the right to the protection of the law, the Public Trust Doctrine, the Financial Principle of the Constitution and Separation of Powers Doctrine.

94. Why the Belize decision supports the Appellants

94.1. The Belize decision contains a very useful illustration of a number of key points relied on by the Appellants in the present case; first, it illustrates the proper approach to public consultation and disclosure in such cases; second, it emphasizes the importance of following proper procedure in approving such projects; third, it makes clear that such projects should not commence until the proper consultation and procedures have been followed.

94.2. The Belize decision contains a very useful illustration of a number of key points relied on by the Appellants in the present case; first, it illustrates the proper approach to public consultation and disclosure in such cases; second, it emphasizes the importance of following proper procedure in approving such projects; third, it makes clear that such projects should not commence until the proper consultation and procedures have been followed.

94.3. First, as regards public disclosure, the decision in Belize makes plain that as a matter of general principle, most civilized legal systems require public disclosure of as much relevant information about the effects of the proposed development before it is approved as can be obtained, and public discussion of the issues raised; see para.12. This also habitually involves public meetings (para.17).

94.4. Indeed, the public involvement in the Belize case extended to having the relevant non-governmental organizations represented on the NEAC itself (see para. 23) and voting on the recommendations (para.25).

94.5. In the present case, none of these basic principles of public disclosure, consultation or involvement was followed. This is indeed, one of the central grounds of review. What the Belize case makes clear is that this is the habitual practice in civilized countries and there is a legitimate expectation that such a process would be followed in the Bahamas.

94.6. Second, the Belize decision also makes clear the importance of following proper procedure for the approval of major environmental projects. (see para. 13).

94.7. Third, what the decision in Belize also makes clear is that such projects should not commence until the proper procedures have been followed and approval has been obtained. There is no such concept as “approval in principle”: which could allow for the project to commence before proper approval is given. It was accepted by all parties that full approval, following consideration of the EIA, was necessary to enable the project to proceed (see para 19 and 20). It was also clear that the project proceeding was dependent upon the obtaining of an Environmental Compliance Plan (see para. 25). It is evident that there were no works, not even access roads, constructed until after statutory approval of the project (see para 26).

94.8. In the present case, all that has been signed is a Heads of Agreement, and yet leases and other rights have been purported to be granted in respect of the development, and substantial works have started.

94.9. As Lord Walker makes clear in his (dissenting) speech, it is often suggested that somehow all challenges to major projects must be subsumed to the overriding principle of the need to attract foreign investment. Lord Walker makes clear that “the rule of law must not be sacrificed to foreign investment, however desirable” (para 121) this is a principle that would be well to be observed in the present case.

94.10. There are three further points that arise from the Belize decision on interlocutory matters which support the Appellants’ approach in the present case.

94.11. First, Lord Walter (dissenting, though not on this point) makes clear that it is possible in such a case for the Court to grant an injunction to restrain the developers from proceeding with the development (see para. 119).

94.12. Second, Lord Walter makes clear (again, dissenting though not on this point) that public bodies are under a full duty of disclosure in such cases and a duty to cooperate with the Court in making full disclosure of the relevant facts and materials (para 85 – 86) and that such duty extends to the developers themselves (para. 87). In the present case, this duty of disclosure simply has not been met.

Ground 5; The Constitutional points; Independence of the Judiciary

95. Whilst no criticism is made of the learned Judge’s own personal integrity, it is respectfully submitted that the learned Judge did not constitute an independent and impartial tribunal as required by the Constitution, and as such he was not clothed with the constitutionally required jurisdiction to be independent within the meaning of the Constitution for two reasons.

96. Firstly by reason of the matters set out in the Judgments of the Supreme Court delivered by the Honourable Mr. Justice John Lyons in the cases of Moss v Bahama Reef Condominium Association and the Attorney General, FP 230/01 and The Queen v Pratt and Others FP 86/8/2001, Braynen v Attorney General and Others 1283/1994, Knowles v Attorney General and Others 2495/2002;Neymour vs. The Attorney General CL 574 of 2002; and will seek to distinguish the case of the Queen v Jones 132/12/2002 (Allen J).

97. Section 4 of the Judges Remuneration and Pensions Act, Cap 45 is mandatory and not directory. A failure to comply therewith amounts to a breach of the Separation of Powers Doctrine, in that, by reason thereof there is and was an appearance that the Supreme Court judges were beholden to the Executive arm of Government for an increase in salary and in any event Judges of the Supreme Court have been deprived on two (2) separate occasions of their property right to a triennial salary review in breach of their contracts of employment, the Judges Remuneration and Pensions Act, Cap 45, Articles 88(2) and 93(2) of the Bahama Islands Constitution, 1963 and Article 135 of the 1973 Constitution, and the Separation of Powers Doctrine as the same applies to The Bahamas.

98. It is submitted that, in as much as Article 20(1) and 20(8) of the Constitution of the Commonwealth of the Bahamas, 1973 guarantees to all subjects in the Bahamas a right to the protection of law which encompasses the right to a fair hearing before an impartial and independent tribunal in both criminal and civil matters, the deprivations more particularly referred to above are not merely private matters between the Government and the individual Judges of the Supreme Court. Indeed, the said deprivations impact the right to the protection of law under Articles 15 and 20(8) of the Constitution and as such are matters of general public importance, and prejudicially impacted the rights of the Appellants. Valente v The Queen [19850 2 S.C.R. 673

99. Secondly, it is respectfully submitted that as the Honourable Mr. Justice Carroll’s appointment as a Justice of the Supreme Court was only “acting” and not permanent, he did not have the constitutionally required security of tenure to constitute an independent tribunal, in particular given that the 1st to 3rd Respondents were organs of the state.

100. Whilst it may be permissible for “acting” judges to be appointed to the Supreme Court, given their lack of security of tenure and the potential for the appearance of bias, they are should not conduct any criminal trials, and nor should they conduct cases in which the state or any of its organs are parties.

101. In the result, it is submitted that the Appellants were denied their constitutional right to a fair hearing by an independent and impartial tribunal in accordance with Article 20(8) of the Constitution.

Ground 6; Discovery and Cross Examination

102. The Appellants were denied a fair hearing because they were denied the opportunity to obtain discovery and to cross examine deponents who swore affidavits on behalf of the Respondents.

103. As the Affidavit of Erin Lowe [1/8/133] makes plain, the Appellants have been complaining about the failure on the part of the Respondents to provide discovery of relevant papers from February 18, 2005.

104. Whether or not discovery was sought, as Lord Walker points out in the Belize case, there was a duty on all of the Respondents, to make full discovery of the relevant documents. Prior to the commencement of the judicial review proceedings and throughout the course of the proceedings, despite attempts to obtain discovery, all of the Respondents have steadfastly resisted making discovery.

105. Discovery as to whether or not permits had been issued either by any central government bodies or District Council was highly relevant firstly on the issue of whether an injunction would have caused prejudice or not to the 4th to 9th Respondents. If no permits had been issued from the proper authorities then no prejudice would have been occasioned to the Developers from the injunctions previously sought. This remains relevant before the Court of Appeal in considering the Appellants’ motion for an injunction as to which see the Submissions hereafter.

106. Discovery was highly relevant on the issue of legitimate expectation. If any permits has been issued without consultation, and indeed without the Appellants even knowing that they had been issued, and in the face of the Appellants repeated requests for information, then this would have shown that there had been no consultation, in breach of the Appellants’ legitimate expectation to be consulted, and no intention of every consulting the Appellants.

107. Discovery was also relevant to the issue of irrationality. If despite the Appellants’ requests to be permitted to participate in the process, and if permits had been issued in secret, this is evidence that the Government had been acting unlawfully and has had something to hide and is therefore permitting the development to occur on an irrational basis.

108. Discovery was also relevant because the Court of Appeal on the hearing of the appeal from the Decision of Isaacs, J, made it so. The Court of Appeal asked Mr. Barnett, Counsel for the 4th to 9th Respondents whether any permits had been granted.

109. Discovery was relevant as to whether or not the 1st to 3rd Respondents were acting ultra vires. Substantial works have been conducted at the development site, in particular, on Crown and Treasury Lands and there is no evidence of any permits from any statutory bodies or district council having been granted. Indeed as to the Crown and Treasury Lands, the Affidavit of Ms. Fraser is evidence that no leases or grants were made of the Crown or Treasury Lands.

110. Further the Agreement makes it clear that no consideration was to commence without an Environmental Management Plan being in place and there is substantial evidence of work having been conducted despite the fact that the Affidavit of Dr. Cooper filed in January 2006 clearly states that as at that date no Environmental Management Plan had been settled upon. In such circumstances, discovery as sought by the Appellants, was crucial in determining on what purported basis the 4th to 9th Respondents were conducting, and continuing to conduct, the extensive physical works.

111. As to cross examination, there were clearly issues of fact and conflicting affidavits in respect of which the Appellants should have been given an opportunity to cross examine. It is submitted that whether there are serious issues of fact or there is disputed evidence on affidavits, not only should cross examination be allowed but, without it, it was not possible for the Learned Judge to make findings of fact, as he did, based upon conflicting affidavits.

112. It is submitted that the opportunity to cross examine would have ensured a fair trial to the Appellants.

113. The Appellants were denied a fair hearing when firstly, the Respondents failed in their obligation to make full discovery and when the Learned Judge refused to order discovery or cross examination.

114. The appellants will refer to a number of examples in Volume 6 of the Record, being the Transcript of the trial, in support of their submission that on crucial issues, the lack of discovery and inability to cross examine greatly prejudiced a fair trial until delivery of judgment by the Court of Appeal.

Grounds 7, 8 and 9; injunction and evidence

115. As to the injunction submissions are set out below as to why an injunction should now be issued.

116. Grounds 8 and 9 have been included in grounds 1 through 4.

Motion filed February 8, 2007 for an injunction restraining the 4th through 9th Respondents from continuing the physical works pending the delivery of Judgment by the Court of Appeal

The evidence

117. The Appellants rely on the evidence as appears by the Record herein and also the Affidavit of Troy Albury [6/56/255]

Jurisdiction to grant an injunction

The Court of Appeal has the jurisdiction to grant the injunction sought by the Appellants.

118. The Supreme Court having delivered its Judgment on October 12, 2006 was functus and would not have had jurisdiction to issue an injunction.

119. In any event, contrary to the submissions of the Developers (4th to 9th Respondents) after delivery of the Judgment in the Supreme Court, the Appellants applied to Carroll J Actg. to stay the effect of his Judgment and to thereby continue in being the Privy Council’s injunction or alternatively, to make a Conservatory Order preserving the status quo. The Learned Judge refused to grant the stay or make a consent order and directed that the Appellants should seek a stay or further injunctive relief from the Court of Appeal.

120. In making the application, no objection was taken by the Respondents (1st to 3rd) or the Developers that the application should be made by any process to be filed and indeed, Carroll J. Actg. did not require the same. Carroll J. Actg. considered the application and refused the same.

121. Accordingly, it is submitted to the extent that there was any jurisdiction in the Court below to grant an injunction and/or a stay which would have had the same effect, such application was made and refused.

122. In the premises, the application before the Court of Appeal is procedurally in order.

Alleged delay in making the injunction application.

123. The Developers complain that the Appellants have delayed in moving this Court for injunctive relief. The Appellants will rely upon paras 133 to 136 of the Affidavit of Mr. Troy Albury filed herein on March 5, 2007.

124. Subsequent to the filing thereof, Ms. Kenra Parris, Counsel to the Appellants, has confirmed that she contacted the Court of Appeal on a daily basis for over a week in attempting to obtain an early date for the hearing of the injunction. Exhibited to the Affidavit of Kenra Parris filed on May 10, 2007 is a copy of a letter dated February 6, 2007 to the Registrar of the Court of Appeal and a copy of an email dated March 2, 2007 from Ms. Parris to Mr. Frederick Smith indicating the attempts to have the injunction application heard at the earliest possible date.

Principles governing the grant of an interlocutory injunction

125. The Court has a very wide discretion in granting or refusing an interlocutory injunction. The principles which guide the Court in exercising its discretion are that there should be a serious issue to be tried, that the balance of convenience is in favour of maintaining the status quo and that damages are not an adequate remedy.

126. The Appellants submit that insofar as its action is similar with the Belize Alliance case, the guiding principles set out therein are applicable to the present case, and this Court essentially has a wide discretion to adopt a course which minimizes the risk of injustice.

127. It is submitted that the grant of an injunction is the course which minimizes the risk of injustice in the present case.

128. Although all of the Respondents in their submissions complain of the delay that has occurred in this matter, it is submitted that the same has certainly not been the fault of the Appellants.

Delay allegedly causing harm to the Developers, status quo, balance of convenience

129. As the history of this matter reflects, the Appellants sought and obtained leave to issue proceedings on April 4, 2005, within one month of the signing of the HOA, and were ready to have the hearing of the Judicial Review application by April 26, 2005 being the date upon which the Court appointed trial should occur. This date was noticed to the Respondents upon filing and service of the Originating Notice of Motion of April 5, 2005.

130. The Respondents contacted the Appellants’ Counsel on the same day and indicated that they would seek an adjournment on April 26.

131. On April 25 the Developers, not then Respondents, filed a Notice of Motion seeking leave to be heard in opposition to the application on the same day the Appellants filed and served their submissions in support of the Appellants’ Motion.

132. On April 26, before Justice Isaacs, the Respondents applied for an adjournment. At that hearing, the Appellants, wishing to be cooperative, consented to an adjournment to give the Respondents further time to prepare and to provide the Developers with an opportunity to be heard. The consent of the Appellants was specifically made subject to the Court ordering a stay of the development pending the trial.

133. The Appellants made it clear that they had very quickly brought judicial review proceedings to protect and preserve their rights and the environment and did not wish delays to occur in the proceedings whilst the Development continued thereby feeding any arguments which the Respondents and the Developers might wish to raise that the Development was in progress and that any injunction or stay should not be issued as the Developers would suffer financial loss.

134. The Appellants made it plain to the Court that they were only applying for a stay on April 26, 2005 because the Respondents applied for an adjournment and because of the anticipated delay the Appellants did not want it to be said that the Appellants had not tried to obtain interim relief so that it could not later be said that the project was too far gone to be stopped.

135. Isaacs J granted an adjournment and set a date for the stay application. The Developers’ motion to be heard was considered and leave was granted for the Developers to be heard.

136. The Court invited the Appellants to agree an adjournment on condition that the stay motion should be heard shortly. Alternatively, the Appellants invited the Respondents and Developers not to proceed until the hearing of the stay and/or determination of the Judicial Review application. It is to be noted that at that time that the Heads of Agreement had only just been signed on March 5, 2005 and the Developers had only just launched physical works.

137. As the transcript of that reflects, the Court ordered the stay application to be heard, then the Court said that it hoped not much damage would be done in the meantime.

138. The Court adjourned the stay application to May 4, 2005, and adjourned the Notice of Motion for the trial of the Judicial Review application to May 24, 2005.

139. Thus, from a very early stage, the Developers have been on notice that the Appellants would seek to preserve the physical state of the environment until determination of the Judicial Review application. Thus, any expense or financial obligations incurred were a calculated risk taken by the Developers in the face of extremely vigorous prosecution of the Appellants’ rights including, attempting to stop the physical works of the Development in the meantime.

140. As the subsequent history of this action reflects, the Appellants have repeatedly through interim injunctive relief, never slept on their rights and they never lulled the Developers into thinking or believing that they could properly continue works without objection from the Appellants. Indeed, the Developers have at every stage come to appreciate the seriousness and commitment with which the Appellants have pursued their rights, particularly in attempting to preserve the physical state of the environment.

141. At all times the Appellants also attempted to push for the early determination of their Judicial Review application and for interim injunctive relief. Indeed, it is only as a result of the barren technical objections taken as to locus standi, with which the Appellants were met by way of preliminary objections at the injunction and stay application on May 26, 2005, that the subsequent delay from May 2005 to November 2005 occurred.

142. Indeed, it is submitted that the Respondents and the Developers should have taken the matter seriously as the Court of Appeal directed in November 2005, and dealt with it on the merits.

143. The subsequent delayed trial before a different judge which occurred in February 2006 could have been avoided and it is submitted the fault of such delay lies squarely at the feet of the Respondents and the Developers.

144. Further, it is submitted that the delay in the delivery of the Judgment by Carroll J. Actg. from February 2006 to October 2006 was not the fault of the Appellants and thus delays in the project proceeding could not be attributed to the Appellants.

145. As to the period since October 2006 and April 2007 the Appellants submit that they have not been dilatory.

146. Again, the Developers, being fully aware of the Appellants’ conviction in prosecuting their rights, ought not, as they have stated in Mr. Devitas’ Affidavit filed on March 21, 2007, immediately re-commenced works.

147. All of the Respondents were well aware that the Appellants had 6 weeks within which to file a Notice of Appeal and they did so prior to the expiration of the 6 week period.

148. It is submitted that, given the extremely important nature of the issues of public importance herein and the irreparable damage which would occur by continued physical works, the Respondents should have voluntarily undertaken not to proceed with the works until the hearing of the appeal, making this injunction application unnecessary.

149. Instead, the Developers have proceeded at an accelerated rate and have effected tremendous damage to the physical environment.

150. Not only that, but as the Affidavit of Troy Albury evidences, there is no evidence of any Hope Town District Council permits or other statutory body permits, for the works which have been effected.

151. Indeed, the Affidavit of Mr. Devita also fails to evidence any permits which have been granted authorizing the lawful physical activities being conducted.

152. Further, the Affidavit of Troy Albury evidences the complete failure on the part of the District Council and/or the Attorney General to respond to the enquiries as to whether or not any permits or licenses indeed have been granted.

153. Importantly, from October 12, 2006, when the Judgment was delivered, and an application for a stay was made in open court, the Developers have been on notice of the Appellants intention to appeal and to attempt to enjoin continuing physical works.

154. Further, as referenced above, since the filing of their Notice of
Appeal, the Appellants have been attempting to have the injunction application heard.

155. Thus, it is submitted by the Appellants that the evidence of Mr. Divita at paras 24 to 27 of his Affidavit that the Developers would suffer damage if the injunction is granted, is misconceived and should not form a proper basis upon which the Court of Appeal should exercise its discretion not to issue the injunction.

156. Indeed, it is submitted that the anxiety expressed by the Appellants to Isaacs J on April 26, 2005 was well-founded. At that time, the balance of convenience certainly lay in preserving the status quo and that was to maintain the physical state of the environment intact.

157. Now, ironically, the Developers are submitting that because their project has continued periodically over the last two years, they would suffer damage if they were enjoined from proceeding, thus the balance of convenience, they say lies in their favour.

158. This submission should be rejected as the balance of convenience as at the date of making the first stay application of April 2005 and continuing thereafter, should be the factor guiding the Court’s decision.

159. Further, although extensive damage has been done in deforestation and mangrove clearance and dredging as appears in the photographs exhibited at Tab 1 of Troy Albury’s Affidavit, this is a 10 year project, and the balance of convenience still lies in favour of maintaining what is left of the physical and marine environment pending the determination of the appellate process. As to this the Appellants rely on the evidence at Tabs 2 -4 of Drs. Risk, Cervino and Goureau.

160. Further, the absence of any evidence that the Developers have been granted any lawful permits to engage in the physical works, gives greater support for issuing the injunction and thus maintaining the status quo.

161. Accordingly it is submitted that the grant of an injunction constitutes the course which minimizes the risk of injustice in this case.

162. If the Development is permitted to continue, damage to the environment will continue and it certainly is irreparable and cannot be compensated with any damages by the Developers or otherwise. The effect of such damage is particularly profound on a small island community.

The issue of cross-undertaking in damages

163. Both the Respondents and Developers complain that the Appellants have refused to offer an undertaking in damages and the Respondents submit that even if the Court is minded to grant an injunction, it should be granted on the usual terms as to cross-undertaking in damages.

164. The Appellants are not in a position to give a cross-undertaking in damages. Indeed, at the Privy Council, the Board in granting an ex parte injunction and subsequently upholding the same inter partes, did not consider it proper in the circumstances of this case, to require the Appellants to provide the same.

165. It is respectfully submitted that, if the Court determines to grant an injunction, it should likewise not require an undertaking in damages. It is submitted that any damages that would be sustained by the Developers pending the determination of the appellate process would not be substantial given the scope and time frame for this project.

166. It is submitted further that in any event, further works ought not to occur as there is no evidence that the Developers have in place the necessary permits and approvals to allow the development lawfully to proceed.

167. In particular, the Developers do not appear to have, or have refused to provide, evidence of having

167.1. building and planning permits issued by the District Council as required by the Local Government Act;

167.2. Grants of Crown and Treasury land (see Affidavit of D. Fraser and evidence that no such Leases or Grants have been issued and yet much of the works are being conducted on the Crown and Treasury Land)

167.3. A final Environment Management Plan is required by Clause 2.2. of the Heads of Agreement (HOA) is produced.

168. Finally, it is submitted that even if the Development is lawfully permitted to proceed, in the context of a planned $500M, 10 year development the costs arising from a delay would be relatively small.

Merits of the Appeal

169. It is submitted that the merits of the appeal are factors to be taken into account in the exercise of the Court’s discretion, although they are not determinative, but the Court may be entitled to form some view of the relative strengths or weaknesses of the Appellants’ case.

170. It is submitted that the Court having had the benefit of hearing all parties on the merits of the appeal, t