Speech made by Justice Priyantha Jaywadana at the National Law conference
The President of the Republic, My Lord the Chief Justice, my brother and sister judges of the Supreme Court, the President and the other judges of the Court of Appeal and the other courts, President’s Counsel, the President and the Secretary of the Bar Association, the Chairman of the National Law Conference, Distinguished Guests and my dear friends.
It is an honour and a pleasure to be standing before you this morning, entrusted with the delivery of the keynote speech, setting the tone and outlining the theme of the event. I must start by commending the Organizing Committee of this conference for the mammoth effort put in by them in bringing together this conference and thank them for having me as the keynote speaker.
The potential impact of this conference on its participants is significant, especially at this time, when our motherland is facing unprecedented economic and financial challenges. We have never encountered such difficulties in our history. All of us have a duty to do our best for our Nation to come out of the current predicament. There is an impressive line-up of plenary sessions on a number of significant topics over the weekend. The gathering at this hall, bears testimony to the interest that you all have in this conference.
During this conference we will be discussing the Ease of Doing Business and Enforcement of Contracts within a Conducive Legal Framework and related topics.
We are having this conference at a time where the World Bank has ranked Sri Lanka at 99th place in the ‘Ease of Doing Business’ Index and at 164th place on ‘Enforcing Contracts’. As you all know, these rankings are a prime consideration when investing in a country.
I intend to focus on the role that the Judiciary and the Executive can play to improve the above parameters, which is a must for the economic revival of our Nation.
Creating an environment that attracts and safeguards the investments of both foreign and local investors is essential in strengthening the economic framework of our country.
When we think about the economy and business, investments, both local and foreign, play a major role in both matters. Do you know why foreign companies as well as local companies are reluctant to invest in Sri Lanka? What is the main reason for local companies to invest in other countries? Is it because such companies make better profits overseas ? In my view, the answer is that it is difficult to do business in Sri Lanka. There is no investor friendly environment, predictability and security for investments in Sri Lanka.
Would any one of you invest your money in a place like that? If we are serious about promoting investment, the key to it is to establish law and order in the country.
Widespread bribery and corruption are deterrents to getting the business community to invest in Sri Lanka. Drugs, theft, robbery, the taking of ransoms, strikes and social unrest are adversely affecting our economy. Such matters should be dealt with swiftly by the Government.
Furthermore, we can improve our ‘Ease of Doing Business’ index by removing the red tape. We all know that potential investors are sent from pillar to post in order to get the necessary licenses and approvals that are required to commence a business. Does it improve after commencing a business ? All of us know the answer to it.
I suggest the establishment of an institution by law to handle matters relating to investments, which is directly responsible to Parliament. Such institution should be made responsible for supervising the implementation of projects and report back to Parliament on the progress of such projects. Ideally, it should replace the Board of Investment and the powers given to the Port City to grant concessions to investors. Of course, when conferring powers on such an institution one must keep in mind the principle that ‘absolute power corrupts absolutely’, and include adequate checks and balances.
Recently, I read a newspaper article where the Minister of Justice has said that there are approximately 6,000 cases pending before the Commercial High Court. This is disturbing news as the Commercial High Court was established to dispose of Commercial cases speedily with a view to promote both local and foreign investments in Sri Lanka.
The Commercial High Court was considered a success initially due to the appointment of judges with a firm grasp of commercial matters. However, this practice has changed despite there being several members of the judiciary who hold Masters of Law Degrees in commercial law.
If one thinks that the judges can learn commercial law and civil law while serving on the Bench it is a big mistake. I believe that the appointment of judges to the Commercial High Court who are not conversant in commercial law has contributed to the present predicament.
To give an example, recently, a case was filed by a borrower in the Commercial High Court, challenging a resolution passed by a bank to parate execute a mortgaged property which was given as security to obtain the loan. An interim injunction was also sought to prevent the auction.
The Commercial High Court refused to grant the interim injunction and fixed the matter for pre-trial. Being aggrieved by the said order, the borrower appealed to the Supreme Court. Fortunately, the case came up before a Bench of which all three judges are conversant with Banking law.
During the course of the proceedings, it transpired that the auctioneer had passed away before the property was auctioned. What is the legal effect of the resolution where the auctioneer has passed away? Can the bank auction the property without passing a fresh resolution? Should the courts proceed with the trial ? What are your answers to those ?
In the mid-nineties, Sri Lanka planned to establish an International Arbitration Center. To facilitate that, the Arbitration Act No. 11 of 1995 was enacted and the provisions applicable to Arbitration in the Civil Procedure Code were repealed. The main object was to simplify the procedure applicable to arbitration and to expedite the enforcement of arbitration awards.
At its inception, the applications filed under the Arbitration Act were disposed of expeditiously. What is the position now? How long will it take to dispose of those applications? I was told that the provisions in the Civil Procedure Code are also applied to those applications now. In those circumstances, it is wishful thinking to have an international arbitration center at the Port City. Aren’t we deceiving ourselves?
I wish to now focus on how we have addressed the piling up of cases in the Commercial High Court. At the time of establishing the Commercial High Court, the jurisdiction of the Commercial High Court was to hear matters arising from commercial contracts where the value was more than Rupees 3 million. When the cases began to pile up in the said court, the threshold was increased to Rupees 5 million and then to Rupees 20 million and once again to Rupees 50 million in the year 2022.
At the same time, the number of Commercial High Courts has been increased from one to four. Are these acceptable solutions to the problem ? Or do the answers lie somewhere else?
What will happen to the cases that are arising from the commercial transactions which are less than Rupees 50 million? Now they will be filed in the District Court and be heard by the learned judges who have no expertise in commercial law along with other money recovery cases. Does this not undermine the policy of the then Government in establishing the Commercial High Court ?
In my opinion the remedy is to adopt the old practice of appointing learned judges who are conversant in commercial law and to train them to hear commercial cases.
Some time ago, the salaries of the judges, the Officers of the Attorney-General’s Department and the Officers of the Legal Draftsman’s Department were increased. We are grateful to the incumbent President and former President Mithripala Sirisena for that.
One of the main purposes of this increase was to attract competent individuals to those institutions. Have we achieved that? It’s a well-known fact that whilst the Attorney-General’s Department attracts good lawyers, the Judiciary has failed in that respect.
In my view, the reason is that we have not changed the recruitment criteria to recruit competent individuals to the judiciary. Presently, one must have a minimum period of four years of active practice to be recruited as a Magistrate, pass a written exam in law and face an interview. After four years at the Bar, most of the lawyers establish a good practice. Hence, they are not interested in seeking any other career options.
I believe if we dispense with the present examination system and the requirement for a minimum of 4 years’ experience – and replace it with an IQ [Intelligence Quotient] and EQ [Emotional Intelligence] tests, the judiciary should be able to recruit competent individuals. This is what President Lee Kwan Yew did in Singapore when recruiting officers to the State sector. I believe we should not only apply such a procedure to the Judiciary but also to all State sector recruitments.
The issue of the backlog of cases, of course, is not solely restricted to the Commercial High Court. We must look at all factors that contribute to the backlog of cases in our legal system, as it adversely affects not only our economy, but also the entire country. As you all know, the Supreme Court is inundated with cases because of Fundamental Rights applications and appeals from the Provincial Civil Appellate Courts.
The Supreme Court has been following the jurisprudence from India and that has resulted in widening the scope of its fundamental rights jurisdiction. As a result, the non-granting of increments, issues relating to transfers, promotions, recruitments and Schemes of Recruitment are now being challenged before the Supreme Court.
Do you think that the apex court in the country should exercise its first instance jurisdiction to hear such cases? In my opinion, such matters should go to alternate Fora such as the Commissioner of Labour, Labour Tribunals, the Public Service Commission and the Administrative Appeals Tribunal etc. Even arrests and bail matters are being challenged in the Supreme Court.
I suggest that we vest the Fundamental Rights jurisdiction with the Court of Appeal in order to reduce the work load of the Supreme Court. It will also enable an aggrieved party to appeal against the decisions of the Court of Appeal to the Supreme Court.
Coming back to the delay in disposing of cases, the executive should consider appointing judges with the necessary knowledge and experience in civil and commercial law to the Court of Appeal and particularly to the Supreme Court as the majority of cases that are filed in both of those courts are arising from civil and public law matters. I think it’s about 95%.
Further, the interlocutory and final appeals from the Commercial High Court come directly to the Supreme Court. Hence, I suggest that if the officers of the Attorney-General’s Department wish to join the judiciary, they should handle both criminal as well as civil cases while at the Department. This was the system that the Department had a couple of decades ago and that resulted in producing good judges.
Similarly, the judiciary also needs to go back to the old system where every judge should function as a Magistrate, District Judge and a High Court Judge before assuming duties in Civil Appellate High Courts.
The Judicial Service Commission is burdened with the recruitment, promotions, transfers and disciplinary matters of the minor judiciary which comprises of nearly 250 members. Additionally, such matters relating to Court Registrars, the appointment of members to the Labour Tribunals, Agrarian Services, and the Administrative Appeals Tribunal also come within the purview of the Judicial Service Commission.
Furthermore, the administration of the Judges’ Institute and the Law College are also coming under the purview of the Supreme Court. This is an ever-growing list and the latest addition is the editing of the Law Reports which was traditionally done by senior members of the Unofficial Bar. All of you know what has happened to it now.
In this regard I suggest to enact legislation to relieve the Supreme Court from performing administrative functions that are vested in it and establish separate bodies to handle those matters as in other jurisdictions. Such matters should be handled by persons who are qualified and conversant in the respective fields. Some of those changes can be done by simple amendments to the existing law or administratively. I strongly believe that it will result in a more efficient and expeditious administration system. More importantly, it will make those institutions independent. Further I suggest that all those institutions should be audited by the Auditor General and reported to the Parliament.
Further, the workload of the Supreme Court is also negatively impacted by the establishment of the Provincial Appellate Courts. I have noticed that very few appeals are filed in the Supreme Court against the judgments delivered by the Court of Appeal and most of the appeals are coming from the Civil Appellate Courts.
Recently, the Constitution was amended to expand the Court of Appeal notwithstanding the fact that the Court of Appeal work is shrinking due to the establishment of the Civil Appellate Courts. The learned judges of the Court of Appeal have the necessary knowledge and experience to hear and decide civil appeals. Hence, I recommend that the Provincial High Courts be abolished and provision be made for the Court of Appeal to sit in the provinces in order to enhance the quality of the judgments and thereby to reduce the workload of the Supreme Court.
The issue of the disposal of cases without affecting the quality of justice cannot be resolved only by the judiciary. The Executive also plays a vital role in this regard, when appointing judges to the Court of Appeal and to the Supreme Court.
Further, we need to have an Attorney-General’s Department and a Legal Draftsman’s Department which are capable of handling commercial matters. In this regard, I wish to point out that those who are having commercial law qualifications and exposure to commercial work should be recruited to both those institutions. It is essential to train such officers to handle commercial law matters. Such training should not only be confined to theory but also should be expanded to include the practicalities of the commercial world.
Now I will address some of the issues that are frequently coming up in court and how they can be avoided.
Even before considering the merits of a commercial transaction, the court has to grapple with the technicalities and errors in the awarding of contracts, particularly in the decision-making process leading to the award. Many errors are made in relation to the tender guidelines. Tender evaluations are carried out by persons who are non-lawyers but who are conversant in the relevant field. That is, by technical evaluation committees. Also, Cabinet Memoranda are prepared by layman. More often than not it leads to mistakes in preparation of such documentation. Such mistakes are the basis for challenging the awarding of tenders.
Though those documents contain the correct decisions, the reasoning or the procedural steps that led to the conclusion is either not properly followed or not properly explained in the said documents. In fact, those documents are not prepared in anticipation of possible litigation. Thus, lawyers find loopholes in those documents very easily and challenge the awarding of tenders, bringing the entire project to a standstill.
Such issues can be avoided by getting legal assistance in handling those matters from the inception. Further, I suggest to enact legislation to regulate Government tender procedures.
As far as Cabinet Memoranda are concerned, I suggest to establish a procedure where a panel of lawyers will vet the Cabinet Memoranda before they are presented to the Cabinet of Ministers. Such a procedure will reduce litigation and delays in awarding tenders or any other matter of the Government. I wish to cite one example in this regard.
Dr. Wijedasa Rajapaksa PC filed a Fundamental Rights Application to take over Sri Lanka Institute of Technology (SLIIT) back to the State on the basis it was established by the State, using State funds and it’s still situated on a State Land though it’s a Private Company Limited by Guarantee and its shares are held by certain former State officials.
However, whilst that case was pending before the Supreme Court, I saw a news item which said that the Cabinet of Ministers have approved the NSSB to be converted to a Private Company Limited by Guarantee where the shares of the said company will be held by a few officials.
If the Cabinet Memoranda were vetted by a team of lawyers, they would have highlighted the pending case in the Supreme Court on a similar issue. Should we allow billions of rupees of the tax payers’ money to be taken away by a few persons because of a loop-hole in the law? Can’t the State use those billions to restructure the local debt?
Apart from this, it is necessary to take steps to prevent courts and lawyers from circumventing the procedures stipulated by law.
Another contributing factor is the raising of preliminary objections on trivial matters resulting in the delay of disposing of cases. In this regard, it is worthy of mention that there is currently a new trend of going before the Court of Appeal and objecting to the issuing of notices on the Respondents. Sometimes even the Respondents file limited objections in support of their preliminary objections. Thereafter, both parties file written submissions on the matter.
I am at a loss to understand as to how anyone can object to the issuing of notices in such circumstances, because the Respondents are present in court having taken notice of the case.
The situation worsens if the Court of Appeal issues notices on the Respondents, as they then come to the Supreme Court challenging that order. Now see the predicament of the Petitioners and the courts. The courts are overburdened with writing judgments over frivolous objections and the litigants are saddled with unnecessarily protracted litigation. I recall when I was at the Attorney-General’s Department, we were advised, not to take up technical objections. Even if the action was prescribed, we were advised not to take up the objection of prescription, unless, the facts of the case did not warrant adjudication by court.
I think it is high time that we stop these new practices that are outside the law. In this regard I must mention that in developed countries, the courts award actual Costs. Further, if a lawyer files a frivolous case, the Costs should be paid by the respective lawyer.
There is also a new trend where the lawyers file documents along with the plaint and the answer. The Civil Procedure Code does not contain such procedure. In terms of the Civil Procedure Code, the courts should reject such plaints and answers. However, at present that doesn’t happen and such matters lead to unnecessary problems and give rise to unnecessary appeals. In this regard, I must say that the Law College and the Judges’ Institute have a vital role to play, in ensuring that they produce competent lawyers and judges respectively.
It is also crucial to have frequent Bench and Bar Committee meetings. Such meetings give an opportunity for lawyers to discuss their issues with the Chief Justice.
I am of the view that the failure to get the seniors involved in matters such as judicial reforms and in the administration of key institutions has resulted in declining standards of the legal profession.
I wish to address on the state of the independence, transparency and efficiency of the Judiciary which are paramount for the economic revival of our Nation. Such matters are considered critically and extensively by the international community in assessing our legal system not only for investment purposes but also for other purposes.
One of the salient features in our Constitution is the checks and balances between the executive, legislature and the judiciary. In this regard, I wish to emphasize the need for the executive to keep a tab on the judiciary, including the nomination of judges for foreign training and the making of acting appointments. Is it necessary to train certain judges more than the others ?
Should the judges or public officials attend seminars or training programs that are held overseas when they are shortly due to retire from the Judiciary? In this regard, I am of the view that whether the funds come from within the country or from overseas, it should not be spent on judges who are due to retire within the next two years. Such training would be of greater value and result in greater effect on judges who have a longer period to serve on the Bench. I suggest that the same criteria should apply to the Public Service too.
It is also necessary to consider if one should be allowed to take oaths to function in an acting appointment and then leave the shores of the Island leaving no one to function in that post. This is a matter of grave concern as the Supreme Court and the Court of Appeal cannot function without the Chief Justice and the President of the Court of Appeal respectively. In this regard, one may ask, who would guard the guards?
Further, the executive should not immediately appoint judges who are retiring, to diplomatic posts or to any other Government positions as it will reflect badly on our judiciary. In several countries they have a cooling off period of three years before appointing retired judges to government positions.
In this context, I think it is necessary to make guidelines applicable to the judiciary, members of the Constitutional Council and members of the independent commissions.
Further, I am of the view that it is time that we enact legislation dealing with contempt of court.
The other aspects of the court system must also be given due consideration. It is imperative that we focus on enhancing the skills and competency of the lawyers who are joining the profession. In this regard, the training of persons who want to be lawyers play a vital role.
The Law College was established based on the concept of Inns of the United Kingdom. At present, the academic aspect of legal education is provided by the State and private universities, while Law College is the sole institution that is conferred with the power to conduct a professional course to admit persons to the Supreme Court as lawyers.
However, it is sad to say that Law College has by and large failed to achieve its objects and is also responsible for the ever-declining standards of the legal profession. I am of the view that we need a principal who is capable of restoring the standards of the professional education of Law College without further delay.
In this regard, I suggest that Law College should be taken out from the purview of the Supreme Court and brought under a statutory body where the members should be a combination of senior legal professionals and professional educators.
Now I will address the topic of the “future courthouse”. We have already started virtual hearings. However, I have noticed several lawyers join the virtual hearing either from the lounge of the Superior Court Complex or they just stand outside of the courtroom and use a mobile phone to appear in the virtual hearing. This demonstrates that some lawyers are not yet ready to use the new technology in discharging their professional duties.
Remember, some countries have already started using Artificial Intelligence in the administration of justice. If we don’t keep up with these developments, we will get isolated and thereby our legal practice will be adversely affected.
Trials with artificial intelligence powered judges in Estonia have proven to be effective in adjudicating low value money recovery matters, resulting in human judges gaining more time to address more challenging disputes.
Some countries are also contemplating resolving small claims by using artificial intelligence with a right of appeal to a human judge.
Of course, developments in artificial intelligence, such as “Chat GPT”, are in the infancy of their development. Recently there was a case where a lawyer had to apologize to a court in New York, when it was found that the Chat GPT application had cited non-existent case law which the lawyer had in turn submitted to court.
However, we can certainly start utilizing tested and proven technology in certain matters. For example, in maintenance cases where the parties have to come to court to make the monthly payments. Similarly, in cases where the Magistrates’ Courts have ordered to pay statutory dues or other payments in installments, the parties have to come to court to make such payments. It is an extremely unproductive process for both the litigants as well as the courts. Hence, we can use artificial intelligence to dispense with the requirement of litigants physically coming to courts to make payments, and to monitor the collection of payments and to identify the defaulters.
Further, we can use artificial intelligence to transcribe recordings of court proceedings, and also to translate records and briefs where necessary.
However, such projects shall be carried out by qualified persons in consultation with the Judiciary. Further, such projects should not be headed by the members of the Judiciary as we do not possess expertise in that area. Further, it will be an added burden on the Judiciary.
Though I can go on and on with this subject, I will not take further time as it will adversely affect time management in the conduct of the conference.
I urge the establishment of a Parliamentary Committee to look into these matters and to make necessary recommendations that are required to overcome these challenges. If such a committee is established, I am more than happy to go before such committee to assist them.
Remember, this is our last chance to save our beloved Nation.
If we are united, we will stand and if we are divided, we will fall.
I wish to conclude with the words of President Ronald Reagan ‘By working together, pooling our resources and building on our strengths, we can accomplish great things’.
