The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Grand Bahama Port Authority (GBPA) licensees yesterday won another chapter in their battle with Customs over the Hawksbill Creek Agreement by the score of ‘2-1’, a leading QC warning: ‘We will not let this rest.”

The Court of Appeal sent two Judicial Review cases back to the Supreme Court for a hearing on their merits, overturning previous decisions that threw the matters out on legal technicalities.

The appellate court restored the separate applications by Kelly’s (Freeport), and a combination of the Callender’s & Co law firm, Smith’s Point and Bahamian Outdoor Adventure Tours, finding that the Supreme Court was wrong not to allow the cases to proceed.

Kelly’s (Freeport) had challenged Customs demand that it, and other Freeport-based wholesalers, file with Customs a monthly return detailing their so-called ‘bonded’ goods sales to other GBPA licensees.

The firm had argued that it was not required to submit such a report under the Hawksbill Creek Agreement, and when it failed to do so, Customs refused to clear its imported trailers.

And the Smith’s Point action had challenged Customs’ move to link the renewal of GBPA licensees’ annual permission to purchase goods ‘bonded’ (duty free) with them being fully up-to-date on National Insurance Board (NIB) contributions.

Confirming that both these cases were being sent back to the Supreme Court for a ‘trial on the merits’, Fred Smith QC told Tribune Business: “These judgments reaffirm the rights of licensees to have issues determined regarding the Hawksbill Creek Agreement......

“We will not let this rest. As licensees, we are not going to allow Customs to strip us of our remaining rights under the Hawksbill Creek Agreement by slow, deliberate encroachment.

“This is what Customs does every other year. They find some way to denude the Hawksbill Creek Agreement. The Customs exemptions last until 2054, so licensees have a lot to fight for with Customs.”

The latest Court of Appeal verdicts come against the backdrop of the potential Judicial Review action being contemplated against the Government’s new and increased taxes.

GBPA licensees have been advised that the 2013-2014 Budget impositions, especially the 1 per cent administrative processing fee, Environmental Levy and 5 per cent Stamp Duty on bank transactions/repatriation of profits over $500,000, violate the Hawksbill Creek Agreement.

However, the Court of Appeal yesterday prevented Mr Smith from claiming a ‘hat-trick’ of victories over Customs.

In a split ‘2-1’ majority decision, it upheld the Supreme Court’s decision to refuse Callender’s leave to apply for Judicial Review over Customs’ bid to make the annual renewal of its ‘bonded’ goods permission contingent on filing a report on its ‘bonded’ goods purchases from the previous year.

“At Callender’s we’re considering applying to the Privy Council because, as pointed out in Justice Conteh’s dissenting judgment, there remained real live issues to be determined,” Mr Smith told Tribune Business.

In their majority decision, Appeal Court president Anita Allen and Justice Neville Adderley found that because Customs ultimately rescinded its bid to link renewal of Callender’s ‘bonded’ letter to a report on its duty-free purchases from the previous year, “there was no longer a decision for which Judicial Review could be undertaken”.

They found that no right of Callender’s was “being breached or threatened at that stage”, making its demand for Judicial Review a ‘hypothetical case’ that the courts will not touch.

And Callender’s challenge to Customs’ second decision, that it could apply to it for permission every time the law firm sought to purchase ‘bonded’ goods, was dismissed because such a practice had been in effect for more than a decade.

Describing Callender’s challenge on this count as “fatally out of time”, Justice Adderley wrote in his judgment that it “would be a waste of the court’s time to pursue it”.

“Having gone so long unchallenged, public policy requires the alternative procedure of obtaining individual approval from the Comptroller in the absence of an over-the-counter letter to be accepted in law as a valid decision, or at the very least the appellant is estopped from challenging it,” Justice Adderley wrote.

However, this was not the Court of Appeal’s unanimous view. In his dissenting judgment, Justice Conteh questioned whether Customs’ seeming pull back in its January 16, 2012, letter ‘effectively rescinds’ the issues at the heart of the Judicial Review action.

And he pointed out that it did not resolve the compensation/refund likely due to Callender’s after it was forced to pay duty on items used in its business for six weeks.

Justice Conteh said that while Customs may have reversed its position on granting Callender’s its ‘over-the-counter’ bonded goods letter, it was still insisting the law firm complete a report on its 2011 bonded goods purchases.

“The so-called recission of [Customs] position regarding the over-the-counter letter did not, it is clear, sweep away the important matters raised in [Callender’s] application as a whole,” Justice Conteh said.

Arguing that the Supreme Court had been mistaken to refuse leave to bring Judicial Review, Justice Conteh said the issues raised “cry out for determination” by the courts, given that they go to the heart of GBPA licensee rights and Customs’ powers in relation to Freeport.