Statutory Interpretation Business Law - Essay Example

Sta y Interpretation Traditionally, the arms of government have had their functions defined: the legislature makes law; the executive implements it while the judiciary interprets it. To date, there has not been much change to this allocation of power to the three arms save for the common call for further separation of powers. The powers of the court therefore have much to do with the interpretation of law and as long as the court acts towards this end, no arm of government can usurp its power. Since the courts do not make law, this being Parliament’s role, they can only interpret what is presented to them as law via statutes (Riches & Allen 2011). Since statutes are presented in written form, it is within the court’s power to translate the written word into the actionable form of law i.e. known as breathing life to the law. However, due to the complexities of language and the imperfect nature of legislation, sometimes the intention or purpose of the law may not be conveniently passed in the wordings of the various Acts. This is where the courts derive their power; ensuring that the intention of Parliament is carried into the law. The power of the court to interpret statutes i.e. statutory interpretation has generated controversy for as long as Parliament has been in existence. This is because of the subjective nature of interpretation which relies heavily on the beliefs and understanding of the presiding judge. Over time, judges have been accused of usurping the role of Parliament and ‘making law’ by giving interpretation to statutes in a manner that suits their version of the law. Lord Denning himself once drew criticism in Magor and St Mellons v Newport Borough Council (1952) HL when he remarked that We do not sit here to pull the language of Parliament to pieces and make nonsense of it. We sit here to find out the intention of Parliament and carry it out and we do this better by filling in the gaps and making sense of the enactment than by opening it up to destructive analysis (pg. 25). While he well intended to maintain Parliament’s supremacy by attempting to interpret acts based on its intention, he went a bit overboard by suggested that the courts could ‘fill in the gaps’ in the law which in itself would be tantamount to making law. On appeal to the House of Lords, Lord Simonds described Denning’s interpretation of the powers of the courts as a “naked usurpation of the legislative function under the thin guise of interpretation.” The House of Lords instead stated that gaps disclosed in laws can only be remedied through appeals. The extent of the judicature’s power to interpret law remains blurred which is a major reason judges have often been accused of making law; a role not within their mandate. In Fischer v Bell (1961) and Stock v. Frank Jones (Tipton) Ltd. [1978] 1 WLR 231, the interpretation of the courts of statutes was so distasteful to Parliament that the rulings themselves were overturned through statutes in the same year they were made. This shows that the powers of interpretation are sometimes abused as judges attempt to ‘redefine’ statutes which in their opinion are ambiguous, unfair or unjust. Over the years, several rules of interpretation have come up all in an attempt to guide the courts in the correct usage of their power or in a manner respectful of the separation of powers doctrine. Despite these rules, Twining and Miers (2010) state that over 50 percent of High Court cases and 90 percent of cases before the House of Lords involve aspects of interpretation of the law. Since the court’s interpretation of the law determines how they apply it e.g. in criminal law for purposes of sentencing, the interpretation of the law continues to be a major cause of appeals and a major driving force for litigation. At this juncture, it is necessary to state that the courts may have powers to apply the law; this power is merely incidental to the interpretation that the court makes of the pertinent law. In fact, this power is often included by many scholars in their definition of interpretation of law. The literal rule is the oldest principle of interpretation. It simply requires that the judges interpret statutes according to the natural, plain or ordinary meanings of the words therein. The literal rule is definitely straightforward especially where there is no conflict as to the ordinary meanings of words. To aid in this purpose, the Interpretation Act of 1978 defines several common words/terms which aid judges where such terms have been used in statute. In addition, most statutes now have definitions of the common terms used therein which also serve a similar purpose. The literal rule brings conformity with the doctrine of separation of powers inasmuch as the words and by extension the meanings of Parliament are achieved in terms of interpretation and application. However, the literal rule is too simple and does not appreciate the complexity of language and the ambiguity that can arise out of plainly simple statements. Furthermore, statutes usually use broad statements that cannot be construed naturally at times. The literal rule has come under criticism since at times it does not bring out the intention of Parliament. In the case of Whitley v. Chappell [1868] 4 LRQB 147, the literal interpretation of the wordings “it is illegal to impersonate a person who is entitled to vote” was used to acquit a suspect accused of impersonating a dead voter. The implications are quite obvious. In the words of Lord Denning, "We no longer construe Acts according to their literal meaning. We construe them according to their object and intent." The departure from the literal rule led to the formulation of the golden rule which was well stated in Grey v. Pearson (1857) 6 HL Cas 1 where it was stated that "the ordinary sense of the words is to be adhered to, unless it would lead to absurdity, when the ordinary sense may be modified to avoid the absurdity but no further." This rule keeps the interpretive power of the courts in check by ensuring that they do not go overboard with their ‘correction of absurdities’. The standard has been used in cases such as Re Sigsworth (1935) where the courts prevented a son from inheriting after killing his mother despite the clear unambiguous wording of the Act. Here, we see that public policy may be a good ground for preventing the literal application of an Act. The golden rule also has some inherent weaknesses in interpretation. First, it heavily relies on the literal rule i.e. the plain meaning should be considered first. Secondly, the absurdity of an interpretation is a very subjective test since what would be absurd to one judge would not be necessarily absurd to another. In addition, the golden rule was initially crafted to rectify obvious errors in Acts and not to wholly modify them as Lord Reid states in the case of Luke v I.R.C (1963), "It is only where the words are absolutely incapable of a construction that will accord with the apparent intention of the provision and will avoid a wholly unreasonable result that the words of the enactment must prevail." The mischief rule was crafted to replace the uncertainty of the golden rule. It set quite an understandable and easy standard for judges to follow as laid out in the Heydon’s Case where the judge first considered the defects in common law that Parliament intended to address with the passing of the Act and then applied the Act to suppress the defect or ‘mischief’. The mischief rule has since changed to the ‘purposive approach’ which is now the modern standard of interpretation in many courts. The approach seeks to determine Parliament’s intention while drafting the Act and then applying/interpreting the Act in concordance with the said intention. For a court to effectively use the purposive approach in interpretation, it has to initially find out the intention of Parliament. This can be achieved by examining both intrinsic and extrinsic sources. Intrinsic sources are those that exist within the Act itself such as the long title, the preamble, the short title etcetera. Extrinsic sources are those other than the Act such as the Hansard which documents the debate during the passing of the Act, law reform commission reports, White Papers, Legal Textbooks and Treaties. This approach is much favoured since it respects Parliament’s power to make law and have that law applied in the manner it was intended. Scholars such as Sir Rupert Cross have suggested a new approach to statutory interpretation which is being referred to as the Contextual/Unified or Integral Approach. This approach looks at the context in which the Act exists. To establish content, the judge must first give effect to the ordinary and in some cases, technical meaning of the wording of the Act. Next, they should consider whether such a construction would yield an absurd result and whether a secondary meaning would rectify such a result. Lastly, they should use interpretive aids and presumptions in ensuring that the meaning intended by Parliament is not lost/modified. Despite these rules, the role of interpretation of the law remains unclear with rulings being overturned in higher courts and new interpretations being made. The power to interpret law remains unfettered within the judiciary’s mandate and attempts by Parliament to surpass the authority of the courts to this effect have been quashed as seen in the case of Anisminic Ltd. v. Foreign Compensation Commission (1969), where a statute that had stated that the decisions of the Commission could "not be called in question in any court" was disregarded. References Anisminic Ltd. v. Foreign Compensation Commission (1969) 2 AC 147, HL (E) Fischer v Bell (1961) 1 QB 394 Grey v. Pearson (1857) 6 HL Cas 1 Luke v I.R.C (1963) AC 557 Magor and St Mellons v Newport Borough Council (1952) AC 189 Riches, S. and Allen, V. (2011). Keenan & Riches Business Law- 10th Edition. London: Longman Publishers Stock v. Frank Jones (Tipton) Ltd. [1978] 1 WLR 231 Twining, W and Miers, D (2010) How to Do Things with Rules: A Primer of Interpretation. New York: Cambridge University Press Whitley v. Chappell [1868] 4 LRQB 147 Read More