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CHAPTER 1

INTRODUCTION

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An important function of the law is to provide certainty by making possible legitimate expectations. The
law cannot be based on trust and expectations, however reasonable and fair they may be. On the one
hand, the law must offer certainty and constancy so that individuals can direct their actions accordingly.
For this purpose laws are established and binding decisions are taken, and since these laws and decisions
create legitimate expectations in the minds of individuals they cannot arbitrarily be amended or
repealed later on. On the other hand, the law cannot be static because it has to give shape to a concept
such as justice in a rapidly changing society. Our society expects government to pursue an ambitious
environmental policy, to take far-reaching measures to combat unemployment. These wishes require
continuous adjustment of the law.

The question which arises then is which legitimate expectation must be fulfilled: the expectation which
individuals can legitimately derive from the policy which is contrary to the law, or the expectation which
can legitimately be derived from the law in general? There may be circumstances in which the legitimate
expectation derived from the policy is so strong that the law must be overruled. This theme of the so-
called contra legem effect of the principle of legitimate expectations will be dealt with at length in the
remainder of this article. Here, however, it is sufficient to note that the principle of legitimate
expectations is a principle that has fairly ambivalent ambitions. Two other observations can be made in
this connection.

First of all, the validity of the principle of legitimate expectations is not absolute in the sense that the
legitimate expectations created by executive action must always be fulfilled come what may. In a
concrete case, it will ultimately always be necessary to balance the interests which one or more
individuals have in seeing the principle fulfilled against the possibly conflicting public interest at large or
the interests of third parties.

The second observation is connected with this. Since the effect of the principle of legitimate
expectations requires interests to be balanced in concrete cases, the principle has been developed
mainly by way of case laws. Although some aspects of the principle are embodied in the statute, this
does not alter the fact that the principle has for the greatest part remained judge-made law.

Clearly, the extent to which individuals can put their trust in the principle of legitimate expectations
under constitutional and administrative law is often fairly uncertain. It ultimately comes down to an
assessment of the merits in a concrete case, with the court having the final say. From the point of view
of legal certainty this could be regarded as a fairly gloomy picture. Yet this has to be put in perspective.
Over the years various criteria by which the merits can be balanced have been developed in the
decisions of the administrative courts.
Nature -

A person may have a legitimate expectation of being treated in a certain way by an administrative
authority even though he has no legal right in private law to receive such treatment. The scope of
"legitimate expectations" has been observed as:

A person may have a legitimate expectation of being treated in a certain way by an administrative
authority even though he has no legal right in private law to receive such treatment. The expectation
may arise cither from a representation or promise made by the authority, including an implied
representation, or from consistent past practice.

Object -

Principles of natural justice will apply in cases where there is some right which is likely to be affected by
an act of administration. Good administration, however, demands observance of doctrine of
reasonableness in other situations also where the citizens may legitimately expect to be treated fairly.

Doctrine explained -

In the leading case of Attorney General of Hong Kong v. Ng Yuen Shiu , Lord Fraser stated: "When a public
authority has promised to follow a certain procedure, it is in the interest of good administration that it
should act fairly and should implement its promise, so long as the implementation does not interfere
with its statutory duty."

Wade also states:

"In many cases legal rights are affected, as where property is taken by compulsory purchase or someone
is dismissed from a public officer. But in other cases, the person affected may have no more than an
interest, a liberty or an expectation . . . 'legitimate expectation' which means reasonable expectation,
can equally well be invoked in any of many situations where fairness and good administration justify the
right to be heard."

Contemporary Importance -

Of late the doctrine of legitimate expectation is being pressed into service in many cases particularly in
contractual sphere while canvassing the implications underlying the administrative law. The legitimacy of
an expectation can be inferred only if it is founded on the sanction of law or custom or an established
procedure followed in regular and natural sequence.

It has to be noticed that the concept of legitimate expectation in administrative law has now,
undoubtedly, gained sufficient importance. It is viewed by some that Legitimate expectation is the latest
recruit to a long list of concepts fashioned by the courts for the review of administrative action and this
creation takes its place beside such principles as the rules of natural justice, unreasonableness, the
fiduciary duty of local authorities and in future, perhaps, the principle of proportionately
CHAPTER 2

THE RISE OF LEGITIMATE EXPECTATION

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Although the doctrine of legitimate expectations is being used and appreciated in many different cases in
India, it has developed in Britain over the last thirty years. The description of the leading cases in this
part will show that the following situations generate legitimate expectations and lead to the implication
of a duty of procedural fairness when a decision is at the discretion of an administrative body.

First, where the nature of the interest is such that the person has a right to expect that the privilege
will continue (as in, for example, the case of a licence), a hearing of some sort is required before the
benefit can be withdrawn.

Second, if the decisionmaker has made a representation that a procedure in accordance with natural
justice will be followed, this will be respected. In addition, if there is a regular practice of according a
hearing or other procedure, this procedure will be accorded in the future.

Finally, if a representation is made that a certain decision will be made or certain criteria will be
applied, the agency will be bound to accord natural justice to a person before applying different criteria
or making a different decision.

THE DEVELOPMENT

A. Schmidt case -

The first appearance of legitimate expectations was in the judgment of Lord Denning M.R. in Schmidt v.
Secretary of State for Home Affairs. The Home Office, which administered the Aliens Order, 1953, had a
policy of according aliens studying at a recognized educational establishment a permit to live in Britain.
The plaintiffs had been admitted to study at the Hubbard College of Scientology and were given permits
to stay in the country for a certain period of time. The home secretary, because of concerns about
Scientology, announced that the college would no longer be considered a recognized educational
establishment. When the plaintiffs applied for renewal of their permits, they were refused. They alleged
that this constituted a denial of natural justice, since they were not given a hearing before this decision
was made.

Lord Denning emphasized that, since the plaintiffs were aliens, they were only entitled to remain in the
country by licence of the Crown. He held that the duty to allow representations to be made depends
on whether [the plaintiff] has some right or interest, or, I would add, some legitimate expectation, of
which it would not be fair to deprive him without hearing what he has to say. In this case there was no
legitimate expectation because the permits were for a limited time, which had expired. However, Lord
Denning stated that the plaintiffs would have been entitled to a hearing if their permits had been
revoked before they expired. Were this the case, they would have had a legitimate expectation of being
allowed to remain in the country for the time specified, which would have entitled them to a hearing.

B. Liverpool Taxi case -

The doctrine was further developed in R. v. Liverpool Corporation, ex parte Liverpool Taxi Fleet
Operators Association. Although this decision was also written by Lord Denning, the words legitimate
expectation themselves never appear in the judgment. The number of taxi licences in Liverpool had
been limited by the county council to 300 for some time. When the taxicab owners association heard
that the council was considering increasing the number of taxi licences, it expressed concern, and
received letters from the town clerk assuring it that there would be opportunities for the taxicab owners
to make representations and that interested parties would be fully consulted. The city council
subcommittee did recommend an increase in the number of licences. After the city council meeting
which approved these minutes, the subcommittee chair announced that the number of licences would
not be increased until national legislation, then pending, to restrict private hire cabs was in force. This
undertaking was confirmed in a letter to the association. Nevertheless, several months later, without
informing the association, the committee and the city council decided to begin increasing the number of
licences almost immediately. Although the owners asked for a hearing when they indirectly heard about
the pending resolution, this was denied to them.

Lord Denning held that this promise gave the plaintiffs a right to another hearing if a decision was to be
made contrary to it. He wrote:

.So long as the performance of the undertaking is compatible with their public duty, they must honour
it. And I should have thought that this undertaking was so compatible. At any rate they ought not to
depart from it except after the most serious consideration and hearing what the other party has to say:
and then only if they are satisfied that the overriding public interest requires it..

This passage establishes that if an undertaking has been given by a public body, it cannot be changed
without at least giving the affected person a chance to be heard. This substantive promise could not be
broken without giving the owners special procedural rights.

C : McInnes case -

In McInnes v. Onslow Fane, the plaintiff had applied to the British Boxing Board of Control for a boxing
managers licence but had been refused without reasons or an oral hearing. Megarry V.C. distinguished
three types of cases involving licences or other cases where rights were not involved. If there were a
forfeiture or revocation of a licence or membership, the plaintiff was generally entitled, it was held, to
the full range of procedures of natural justice. At the other extreme, if what was at issue were merely an
application for a benefit, there was no right to be heard. Megarry V.C. suggested that legitimate
expectations constituted an intermediate category. These arose, he suggested, where someones
licence or membership was up for renewal, or where it had been granted informally but was waiting for
confirmation. Thus, following this decision, either the nature of the interest presently held (McInnes), or
a representation or statement (Schmidt, Liverpool Taxi) could give rise to an expectatio
D : Ng Yuen Shiu case

The Privy Council addressed the issue of legitimate expectations in Attorney-General of Hong Kong v. Ng
Yuen Shiu. The government of Hong Kong had instituted what was known as a reached base policy for
illegal immigrants. If an immigrant from China reached the urban areas of Hong Kong without being
arrested the person was not deported. However, because of an influx of illegal immigrants, the policy
was changed and it was announced that illegal immigrants from China would begin to be deported. In
response to a petition, an immigration official read a statement that illegal immigrants from that country
would be treated in accordance with procedures for illegal immigrants from anywhere other than
China. They will be interviewed in due course. No guarantee can be given that you may not subsequently
be removed. Each case will be treated on its merits. The plaintiff, an illegal immigrant who had entered
from Macau, reported to an immigration office to register. However, at his interview the next day, he was
only allowed to answer questions that were put to him, and was not allowed to express what he felt
were the humanitarian reasons he should stay.

Lord Fraser of Tullybelton held that the statement that each case would be treated on its merits gave rise
to a legitimate expectation on the part of the plaintiff, who therefore had a right to bring forward the
reasons he should be allowed to stay. Though he did not give a complete definition of the concept, he
held that a representation by the responsible authority was one way of generating such an expectation.
Finally, he said, if the representation conflicted with its duty the body would not be held to it. If the
representation made was ultra vires, the body would not be required to grant a hearing when departing
from it. this case was also the first leading case in which the terminology used was of fairness, rather
than natural justice.

E : Khans case

Ng Yuen Shiu was applied and developed in the Court of Appeal in R. v. Secretary of State for the Home
Department, ex parte Khan. In this case, the Home Office had circulated a pamphlet outlining the criteria
which it would use when exercising its discretion to allow a child to come into Britain for adoption. The
circular also set out a procedure for gaining approval. The plaintiff wished to adopt his relatives child,
who lived in Pakistan. He followed the steps set out in the circular. However, the criteria set out in the
circular were not applied, since those which the Home Office normally used were quite different.

Parker L.J. held that the circular created a legitimate expectation on the part of Khan that the criteria
contained in it would be the ones applied. He was entitled to a hearing at which he could argue why the
stated criteria should be applied to him. There is also a suggestion that the ministry could not apply
different criteria unless there was an overriding public interest that justified changing them. Like
Liverpool Taxi, Khan shows that a representation by the decision-making body that decisions will be
made based on a certain policy can give rise to special procedural protections. The expectation here was
not of a procedure, but of the application of a certain set of criteria, a substantive expectation.

F. GCHQ case
Perhaps the most extensive application of the doctrine came in what is now generally considered the
leading case on legitimate expectations, in the House of Lords in Council of Civil Service Unions v.
Minister for the Civil Service. The case involved employees of Government Communications
Headquarters (GCHQ), which was responsible for communications and intelligence functions for the
government. The several thousand people employed in this branch of the government were represented
by various national trade unions. As part of the national unions action against the Thatcher government,
several one-day strikes, work-to-rule campaigns, and overtime bans were carried out by the unions
working at GCHQ. As a result of concerns about these job actions and their effect on national security,
Thatcher, who was also the minister for the civil service, announced that the workers at GCHQ would no
longer be entitled to belong to the national unions, and could only belong to an approved staff
association. This was done without any consultation with the unions, despite the fact that in the past,
changes in the civil servants conditions of employment had been the subject of consultation. The unions
argued that they were entitled to a hearing before the decision was made.

Lord Diplock emphasized that a legitimate expectation was not simply one which a reasonable person
would entertain, but required something more to be legitimate. This analysis, though, suggested that
the only types of promises that could trigger the doctrine were those of hearings (as in Ng and GCHQ),
and minimized the possibility of promises of substantive benefits giving rise to procedural rights (as, for
example, in Khan). Lord Frasers view in the same case, however, was broader and did seem to
encompass the Khan situation.

CHAPTER 3

LEGITIMATE EXPECTATION: LEADING CASES

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The emerged concept of legitimate expectations in administrative law has now gained sufficient
importance. Legitimate expectation is the latest recruit to the long list of concepts fashioned by the
Courts for the review of administrative actions. The Legitimate action would arise when there is an
express promise given by a public authority that there is a regular practice of certain thing which the
claimant can reasonably expect to continue. It therefore follows that the concept of legitimate
expectations consists of inculcating an expectation in the citizen that under certain rules and scheme he
would continue to enjoy certain benefits of which he would not be deprived unless there is some
overriding public interest to deprive him of such an expectation.

The basic principles in the branch were enunciated by Lord Diplock in Council of Civil Service Union v.
Minister for the Civil Service, It was observed in that case that for legitimate expectation to arise, the
decisions of the administrative authority must affect the person by depriving him of some benefit or
advantage which either

he had in the past been permitted by the decision make to enjoy and which he can legitimately expect
to be permitted to continue to do until there has been communicated to him some rational grounds for
withdrawing it and which he has been given an opportunity to comment or
he has received assurance from the decision maker that they will not be withdrawn without giving him
first an opportunity of advancing reason for contending that they should not be withdrawn.

The procedural part of it relates to a representation that a hearing or other appropriate procedure will
be afforded before the decision is made. The substantive part of the principle is that if a representation is
made that a benefit a substantive nature will be granted or if the person is already in receipt of the
benefit that it will be continued and not be substantially varied, then the same could be enforced.

Leading cases -

It is clear that promises that a certain procedure will be followed give rise to legitimate expectations in
India, as they do in Britain, and this is the most accepted manner in which expectations arise. One of the
fundamental principles behind the doctrine is that fairness requires public agencies to keep their word
and follow their stated policies about procedure.

In Attorney General of Hong Kong v. Ng Yuen Shiu the government announced that illegal immigrants
would not be deported till their cases would be considered individually on merits. A deportation order
was passed against the applicant without affording opportunity. Quashing the order, the Court observed:

"When a public authority has promised to follow a certain procedure, it is in the interest of good
administration that it should act fairly and should implement its promise, so long as implementation
does not interfere with its statutory duty."

In Navjyoti Coop. Group Housing Society v. Union of India as per the policy of the government, allotment
of land to housing society was to be given on the basis of "First come first served". It was held that the
societies who had applied earlier could invoke the doctrine of 'legitimate expectation'.

In R v Commissioners for Inland Revenue ex parte Unilever Plc, the Inland Revenue's practice was to
allow applicants' claims for loss relief even if the claim was not made in accordance with statutory
requirements. Then after many years, a 17m claim was rejected. This was held to be an unfair abuse of
power and gave rise to a legitimate expectation requiring substantive protection.

In the case of Navjyoti Co-Op. Group Housing Society V. Union of India, it has been held that person
enjoying certain benefits/advantage under the old policy of the Government derive a legitimate
expectation even though they may not have any legal right under the private law in the context of its
continuance. The doctrine of 'legitimate expectation imposes in essence a duty on the public authority
of act fairly by taking into consideration all the relevant factors relating to such legitimate expectation
that may have a number of different consequences and one of such consequences is that the authority
ought not to act to defeat the legitimate expectation without some over-riding reasons of public policy
to justify its doing so.

In R v SoS for the Home Department ex parte Ruddock, the applicants sought a declaration that the
Secretary of State had acted unlawfully in authorising warrants for telephone tapping. They maintained
they did not come within the stated criteria. Taylor J found that they did, but if not, then they could have
legitimately expected that their telephones would not be tapped. This right could have been protected
by substantive relief. Prior consultation before criteria were established or changed was obviously
inappropriate in such cases.

Furthermore, if the authority proposes of defeat a person's legitimate expectation it should afford him
an opportunity to make a representation in the matter. In the case of Food Corporation of India V/s M/s
Kamadhenu Cattle Feed Industries, it has been held that non-arbitratrariness, fairness in action and due
consideration of legitimate expectation of the affected party are the essential requisities for a valid state
action. It has also been held that whether expectation is legitimate is a question of fact which has to be
determined in the larger public interest.

The Supreme Court in the case of Union of India v/s. Hindustan Development Corporation, elaborately
considered this principle. In this case, it has been held that the principle of legitimate expectation gave
the applicant sufficient locus standi to seek judicial review and that the doctrine was confined mostly to
a right to fair hearing before a decision which resulted in negativing a promise or withdrawing an
undertaking was taken. It did not involve any crystallized right. The protection of such legitimate
expectation did not require the fulfillment of expectation where the overriding public interest required
otherwise. However, the burden lay on the decision maker to show such an overriding public interest. In
this case several English and Australian cases were referred to and conclusions were then reached.

In the case of Madras City Wine Merchant Association V/s State of Tamil Nadu, , the matter related to
the renewal of liquor licences rule which were statutorily altered. It was therefore held that the repeal
being a result of a change in the policy by legislation, the principle of non-arbitrariness was not
invokable. Then again in M.P. Oil Extraction V/s State of M.P. (1997) 7 SCC 592, it was held that the
State's Policy to extend renewal of an agreement to selected industries which came to be located in
Madhya Pradesh on the invitation of the State, as against the local industries was not arbitrary and the
said selected industry had a legitimate expectation of renewal under the renewal claims.

In this way, I have referred many leading case laws which are important to be discussed. Hence finally
concluding in my opinion, with the passage of time we are getting enlightened to the various
fundamental rights as guaranteed by the Constitution under Article 14 of the constitution. We have a
right to equality but the executive and administrative excesses many a time deprive us of this. There is
therefore a constant demand that the administrative action must be fair, reasonable and non-arbitrary.
The doctrine of legitimate expectation has its genesis in the field of administrative law. Precisely
speaking the Government and its departments, in administering the affairs of the country are expected
to honour their statements of policy or intention and treat the citizen equally without any iota of abuse
of discretion. The policy statement can not be disregarded unfairly or applied selectively.

CHAPTER 4
LIMITATIONS

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The doctrine of legitimate expectation, has its own limitations. The concept of legitimate expectation is
only procedural and has no substantive impact. In Attorney General for New South Wales v. Quin, one Q
was a stipendiary Magistrate in charge of Court of Petty Sessions. By an Act of Legislature that court was
replaced by Local Court. Though applied, Q was not appointed under the new system. That action was
challenged. The Court dismissed the claim observing that if substantive protection is to be accorded to
legitimate expectations, it would result in interference with administrative decisions on merits which is
not permissible.

Moreover, the doctrine does not apply to legislative activities. Thus, in R. v. Ministry of Agriculture ,
conditions were imposed on fishing licenses. The said action was challenged contending that the new
policy was against 'legitimate expectations'. Rejecting the argument, the court held that the doctrine of
'legitimate expectations' cannot preclude legislation.

Likewise, in Sri Srinivasa Theatre v. Govt. of T.N by amending the provisions of the Tamil Nadu
Entertainments Tax Act, 1939, the method of taxation was changed. The validity of the amendment was
challenged inter alia on the ground that it was against legitimate expectation of the law in force prior to
amendment. Rejecting the argument and following Council of Civil Service Unions, the Supreme Court
held that legislation cannot be invalidated on the basis that it offends the legitimate expectations of the
persons affected thereby.

Again, doctrine of 'legitimate expectations' does not apply if it is contrary to public policy or against the
security of State. Thus, in Council of Civil Service Unions v. Minister for Civil Service , a question arose
whether the decision of the Minister withdrawing the right to Trade Union membership without
consulting the staff which according to the appellant was his legitimate expectation arising from the
existence of a regular practice of consultation, was valid. It was contended that the Minister had a duty
to consult the staff as per the existing practice and that though the employee did not have a legal right,
he had a legitimate expectation that the existing practice would be followed. On behalf of the Minister
on the basis of the evidence produced, it was contended that the decision not to consul! was taken for
reasons of national security. The Court held as under:

"An aggrieved person was entitled to invoke judicial review if he showed that a decision of a public
authority affected him by depriving him of some benefit or advantage which in the past he had been
permitted to enjoy and which he could legitimately expect to be permitted to continue lo enjoy cither
until he was given reasons for its withdrawal and the opportunity to comment on those reasons or
because he had received an" assurance that it would not be withdrawn before he had been given the
opportunity of making representations against the withdrawal.
Similarly,in State of M.P. v. Kailash Chand , an Act was amended by providing age of superannuation. It
was contended that when an appointment was made by fixing tenure, there was right to continue and
the doctrine of legitimate expectation would apply. The claim was, however, negatived observing that
"legitimate expectation cannot preclude legislation."

In Union of India v. Hindustan Development Corpn., in government contract, dual pricing policy was fixed
by the State Authorities (lower price for big suppliers and higher price for small suppliers). That action
was taken in larger public interest and with a view to break "cartel", it was held that adoption of dual
pricing policy by government did not amount to denial of legitimate expectation.

CONCLUSION

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From the above discussion, it is clear that the doctrine of legitimate expectations in essence imposes a
duty to act fairly. Legitimate expectations may come in various forms and owe their existence to
different kinds of circumstances. It is not possible to give an exhaustive list in the context of vast and fast
expansion of government activities. They shift and change so fast that the start of our list would be
absolute before we reached the middle.

One thing, however, is clear. A court cannot assume jurisdiction to review administrative act or decision,
which is unfair in the opinion of the court. If that be allowed, the court would be exercising jurisdiction
to do the very thing which is to be done by the repository of an administrative power, i.e. choosing
among the courses of action upon which reasonable minds might differ.

On examination of some of these important decisions it is generally agreed that legitimate expectation
gives the applicant sufficient locus standi for judicial review and that the doctrine of legitimate
expectation is lo be confined mostly to right of a fair hearing before a decision which results in negativing
a promise or withdrawing an undertaking is taken. The doctrine does not give scope to claim relief
straightway from the administrative authorities as no crystallised right as such is involved. The protection
of such legitimate expectation does not require the fulfilment of the expectation where an overriding
public interest requires otherwise. In other words where a person's legitimate expectation is not fulfilled
by taking a particular decision then decision-maker should justify the denial of such expectation by
showing some overriding public interest.

Therefore even if substantive protection of such expectation is contemplated that does not grant an
absolute right to a particular person. It simply ensures the circumstances in which that expectation may
be denied or restricted. A case of legitimate expectation would arise when a body by representation or
by past practice aroused expectation which it would be within its powers to fulfil. The protection is
limited to that extent and a judicial review can be within those limits. But as discussed above a person
who bases his claim on the doctrine of legitimate expectation, in the first instance, must satisfy that
there is a foundation and thus has locus standi to make such a claim. In considering the same several
factors which give rise to such legitimate expectation must be present. The decision taken by the
authority must be found to be arbitrary, unreasonable and not taken in public interest. If it is a question
of policy, even by way of change of old policy, the courts cannot interfere with a decision. In a given case
whether there are such facts and circumstances giving rise to a legitimate expectation, it would primarily
be a quest ion of fact. If these tests are satisfied and if the court is satisfied that a case of legitimate
expectation is made out then the next question would be whether failure to give an opportunity of
hearing before the decision affecting such legitimate expectation is taken, has resulted in failure of
justice and whether on that ground the decision should be quashed.