FERNANDO, THE CONSERVATOR OF FORESTS AND TWO OTHERS V. TIMBERLAKE INTERNATIONAL PVT. LTD. AND ANOTHER

FERNANDO, THE CONSERVATOR OF FORESTS AND
TWO OTHERS V. TIMBERLAKE INTERNATIONAL PVT. LTD.
AND ANOTHER

SUPREME COURT
AMARATUNGA, J.,
MARSOOF, P.C. J., AND
RATNAYAKE, P. C. J.
S.C. APPEAL NO. 6/2008
S.C. (SPL) L.A. NO. 4/2008
C.A. APPLICATION NO. 866/2007
JANUARY 27TH,2009

National Environmental Act, No. 47 of 1980 - Management Policy for forests - Section 21 (1) - Rational exploitation of forest resources - Forest Ordinance - Section 8 (3) - Authorizes the Forest Department to impose a levy to remove trees from their stumps in any forest reserve - Sections 12, 20 and 52 - Forest Rules, No. 1 of 1979 -Applies to forests not included in a resered or village forests - Forest Regulations, No. 4 of 1979 - Regulation 3 -Power to prescribe fees, royalties and other payments as specified in Section 20 (1) (h) of the Forest Ordinance - Writ jurisdiction - Who has the right to invoke write jurisdiction -Amenability of a contractual or commercial matter to write jurisdiction - stumpage fee - Proprietary charge - Interpretation Ordinance - Sections 2 (f) and 17 - Stumpage - Royalty - Locus standi - Uberrima fides - stipulation alteri misrepresentation - Stumpage tax -Principle of rule of approbate and reprobate

The 4th Respondent - Respondent Pussellawa Plantations Ltd., became the lessee of the Janatha Estate Development Board (JEDB) on a 99 year lease of Delta Estate. Pussellawa Plantations Ltd., on the belief that the pinus plantation found in the said estate too belonged to the Company in addition to its tea plantation, submitted a forestry management plan for harvesting the forest produce from the forestry plantation found in the said estate to the Conservator - General of Forests for his approval, After the receipt of the approval from the Conservator of Forests, Pussallawa Plantations Ltd. entered into an Agreement with Timberlake International hrt. Ltd. and under and by virtue of the said Agreement sold 42,438 pinus trees planted on 25 blocks of land to Timberlake International Pvt. Ltd

In terms of the Agreement, in addition to the sums paid by Timberlake International Pvt. Ltd., it agreed to pay the 'stumpage fees' to the Conservator - General of Forests through Pussallawa Plantations Ltd. As there had been a default in the payment of stumpage fees, the Conservator - General of Forests directed Pussellawa Plantations Ltd. to stop the felling of trees. It is this order that prompted Pussellawa Plantations Ltd. and Timberlake International Ltd. to invoke the writ jurisdiction of the Provincial High Court.

In the High Court the parties entered into a settlement and withdrew the High Court Writ Application. However later there were further disputes between the parties and this led to the decision to suspend the issue of transport permits to clear the harvested timber.

Thereafter, Timberlake International Pvt. Ltd. invoked the jurisdiction of the Court of Appeal on the basis that the action of the Conservator - General of Forests in imposing and demanding stumpage fees is inconsistent with or exceeding the stipulated royalty was ultra uires his powers under the Forest Ordinance and regulations and rules made thereunder. The Court of Appeal granted interim relief in favour of Timberlake International Ltd.

The Conservator - General of Forests filed a leave to appeal application to the Supreme Court against the order of the Court of Appeal. The Supreme Court stayed the operation of the interim relief and granted special leave to appeal against the order of the Court of Appeal on 11 questions, 14 'a' to 'k'. Questions 'a' to 'e' upon which special leave has been granted by the Supreme Court relate to the alleged authority of the Conservator - General of Forests to charge and recover 'stumpage' for the pinus timber sold by Pussellawa Plantations (Pvt) Ltd. to Timberlake Internationa

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