role of judges in regulation

8/8/2019 Role of Judges in Regulation

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Prof. Bolaji OwasanoyeDirector of Research,Nigerian Institute of Advanced Legal Studies


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Appreciation to NERC and NJI The main perspective in the lead paper is

lucidly presented in the paper of Eve Moran

an Et an Kim re ot A ministrative LawJudges from the Illinois CommerceCommission.


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For this seminar I take judge to mean ajudicial officer as defined in section 318 of the1999 constitution. The section defines judicial

. There is a distinction in the status and role of

the ALJ from Illinois and a judicial officer inNigeria.

A judge as a judicial officer is constitutionallydefined and must take the oath in the 7th

schedule to the 1999 constitution.


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1. The Illinois regime has two types of judges i.e.the ALJ and the state Court judge.

2. The ALJ is a member of the Executive armwhile the state judge is counterpart of our own

u . 3. The ALJ is in fact a regulator of public utilities.The counterpart of the ALJ in Nigeria will bedesignated staff of the NERC.

4. It is not likely that NERC officials perceivethemselves as judges or as performing judicialfunctions even though they may in fact do thesame things as the ALJ officials


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Regulation is one of the inevitableconsequences of the privatization of utilityindustries in Nigeria.

Regu ation is necessary to prevent monopo yabuse and to ensure standards.

Regulation helps us avoid moving from public

monopoly to private monopoly and itspolitical and economic consequences for thepolity.


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Before privatization/commericialisationprogramme which started as part ofStructural Adjustment Program (SAP) in 1986

uti ities an in rastructure were e ivere yinefficient state owned enterprises.

The most notable being electricity under

NEPA now PHCN and telecoms under NITELnow comatose.


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Some states in USA such as Illinois have chosento establish a single regulatory agency such asthe Illinois Commission to oversee the operationof public utilities

u yagencies or rather specialize them at the federallevel by having different regulators for differentutilities e.g. NCC, NERC,

Whenever Nigerias federalism matures somestates of the federation may have their ownutilities agencies to regulate public utilities intheir domain


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Before NERC there was Utilities Charges Commission

(UCC) established by Decree 104 of 1992 to evaluatetrends in utilities tariff and to advise government withregard to increase in tariffs amongst other things.

UCC law covered electricity, telecoms, petroleum,

omest c av at on, ra way serv ces, erry an portservices, road transport, postal and any other utility thatmay be added.

Its functions are now virtually overtaken othergovernment agencies though the law and agency remains

vide Cap U17 in LFN 2004 There is no mention of it in the Electric Sector Reform Act

of 2005 but its powers on electricity sector is overtaken byNERC


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From the lead paper we note that the ALJ must have 1. Deep knowledge of the law and policy this may

mean that ALJ must be lawyers. The paper is notspecific

2. ty to rev ew acts as ev ence 3. Ability to create fair, complete and accurate record 4. Ability to follow precedence of decided cases 5. Ability to prepare decisions as recommendations to

the Commission on cases reviewed 6. Independence of action and ability to resist

pressure from regulated companies and otherquarters


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Nature of proceedings before the regulatory agency in Illinois akin

to a full trial in court Processes are called pleadings; assigned docket or case numbers; hearing notices are issued; ru es o a r ear ng are o serve ; discovery/status/pre trial conferences are held; case flow management processes are followed; sworn testimonies and cross examination is taken; evidence is tendered

lawyers represent clients; ALJ presides over the proceedings as would a judge in any court room; ALJ drafts a judgment which may or may not be accepted by its

employers the Illinois Commission


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Follow up steps such as ability of parties tochallenge the draft order; opportunity for theALJ to defend the order in public; opportunity

o t e parties to i e or Re earing e ore t eCommission.

All these factors underscore reference to

some staff of the Illinois Commission as ALJ This aspect also underscores the quasi judicial

functions of the Commission


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Proceedings before NERC are akin to proceedings before

ALJ Difference is that NERC assumes direct oversight from the

moment a petition is filed. Section 47 of the Electric Power Sector Reform Act gives

power to o ear ngs. Just as in Illinois a party to a hearing before theCommission can request a review of its decision undersection 50(1) of its enabling Act.

S.49 allows NERC of its motion or at the instance of a

party to refer matters of law only to the FHC fordetermination.

This oversight is the main key role of Nigerian judges inregulation.


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Combined reading of ss. 49 and 50 of ESRA2005 implies certain conclusions 1. The reference to FHC is restricted to matter of

.

2. A dissatisfied party may further appeal to Courtof Appeal or Supreme Court on same matters oflaw

3. Any objection outside clarification of law issettled with finality by NERC decision e.g. anaward on pricing and related technical matters.


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The question is do these conclusionsforeclose the well known principles of judicialreview of administrative actions?

Note t at NERC is a y ri regu ator invo vewith executive, legislative andjudicialfunctions.

The intervention of the courts in its action willdepend on which of its functions is in issue


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Executive functions: are subject to judicial review

under the time tested powers of the courts to reviewadministrative actions

Legislative functions: may be subject to review

epen ng on t e crux o t e matter. nce regu at onstake force of law as subsidiary instrument, Can NERCbe final arbiter of the interpretation of its regulations.

A dispute on the meaning of its regulation can be be

referred to FHC under s. 49 as matter of law Note that if the regulation is a technical matter FHC

may not be able to make much impact in the matter


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Judicial function: of NERC would be final byimplication of section 50 except where thereis a matter of law involved and it is referred

T e question is Is it internationa estpractice to foreclose the possibility of reviewof the decisions of the Commission by regular

Courts?


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Broad latitude to challenge decisions of NERC may if

applied in Nigeria, defeat the entire objective of reform. First, delay in Nigerian judicial process is legendary. Secondly, if parties have latitude to challenge NERC

decisions we can assume that virtually every decision will

e c a enge y part es w o ave t e means to t gatethereby frustrating the entire purpose of bringingdevelopment to the sector by a prompt and efficientmethod of dispute resolution.

Third the technical nature of the subject matter is one of

the merits of using a specialised process to deal withmatters efficiently.

Fourth the opportunity to develop precedent of atechnical nature will be frustrated or delayed.


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To underscore this point the lead paper notesthat-

Illinois courts give great deference to theCommissions decisions as the are the

judgments of an administrative body withtremendous expertise in the field of publicutilities and have the qualifications to

interpret specialized and highly technicalevidence. United Cities Gas Co. v. IllinoisCommerce Commission,643 N.E. 2d 719 (1994


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Nigerian courts generally entertain mattersof frivolous or technical nature alreadydecided by another adjudicatory body or a

pro essiona a ministrative pane on a su jectof which judges have limited capacity.

The excuse that someones right is infringed

is used to admit the matter and frustrate thedecision of the earlier body.


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Apart from delay the practice contribute todilemma of already congested appellatecourts groaning under the weight of electoral

an ot er isputes. The clear exception must be where there is

apparent violation of constitutional provision.


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NERC being a public agency is duty bound to act in

accordance with the law therefore where it fails go doso its actions may be challenged for judicial review

For a claimant to succeed it must show that

NERC is under a legal duty to act; or make a decision in a certain way and is unlawfully refusing

or failing to do so; or

a decision or action that has been taken is beyond the

powers i.e. ultra vires the Commission. The three categories of wrongs used to open judicial

review are illegality, fairness and irrationality orproportionality of action.

role of judges in regulation

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