HEARING OF NOBEL LAUREATE PROF YUNUS AND 9 ELECTED DIRECTORS OF GRAMEEN BANK BEFORE THE SUPREME COURT
3 MAY 2011. The hearing resumed today before the seven-member Bench of the Appellate Division presided over by the Chief Justice of Bangladesh, Mr Justice ABM Khairul Haque.
Mr. Rokanuddin Mahmood continued his submission for the petitioner, Professor Muhammad. He submitted that the High Court had committed a gross error of law in summarily rejecting the writ petition filed by Professor Yunus by holding that the Bangladesh Bank had exercised power under Section 45 of the Bank Companies Act to ‘remove’ Professor Yunus from his position as Managing Director of the Grameen Bank, “to prevent unauthorized activities” by the petitioner. Mr. Mahmood submitted that the Bangladesh Bank had not made any statement in the orders under challenge indicating that they were being issued by exercise of the power under Section 45. Further, even if it had made such a statement, Bangladesh Bank would still need to demonstrate objective satisfaction that such an action was necessary in the public interest, or on the other grounds specified in the order. It would also have to comply with the principle of natural justice, and to give the petitioner notice of such an order. It had done neither of these things.
The Attorney General, Mr Mahbubey Alam, when questioned by the Court, said that the principle of natural justice means that a person should not be taken by surprise and dealt with to his or her detriment. He stated that this principle had been upheld because at a meeting of Grameen Bank’s Board in 1999, where Professor Yunus had been present, the Board held that there was no age limit applicable for Professor Yunus’ to hold the post of Managing Director. He also referred to another Board meeting in 2009 where a similar decision was taken. But he did not show any evidence that notice had ever been given to Professor Yunus of the two orders under challenge (both made in 2011).
He asked why counsel for the Respondents had ‘rebuked’ the High Court Judges for the judgment, all for ‘one man who has money’ presumably referring to Professor Yunus.
The Attorney General further argued on behalf of the Government that Professor Yunus was public servant. When questioned by the Court he stated that though the retirement age for public servants is 57, the 60 year retirement age for Professor Yunus had been accepted by conduct of Bangladesh Bank.
The Attorney General further noted that there was no provision for recall of any order by the Court, and if this were to be allowed it would create problems in practice.
Mr. Tawfique Nawaz appeared on behalf of Bangladesh Bank and submitted that there was no provision in the Constitution empowering the Appellate Division to recall its order, and as such it could not do so. He also stated that the Managing Director was liable to retirement in the same way as a public servant, and thatProfessor Yunus must admit that he is a public servant. He said that the problems had all begun when Grameen Bank began to conduct itself as a non-governmental organization although it is established by law. He further submitted that the Managing Director was included in the term “kormi” (employee, which referred to both employees and officers) in the Grameen Bank’s Service Regulations and so was bound to retire at 60 years, and that the time limit for his holding the office had expired. He further stated that Bangladesh Bank had not invoked Section 45 when passing the orders under challenge and these were made in relation to Section 14 of the Grameen Bank Ordinance and also Rule 50 of the Service Rules. He stated that the High Court may have made an error in this regard, as it had referred to the orders under challenge being made under Section 45.
Dr. Kamal Hossain responding to the submission made on behalf of the Government and Bangladesh Bank stated that the argument that the Appellate Division was not empowered to recall its order was misconceived since a specific rule existed in the Appellate Division Rules, Order XXXIV Rule 8 which gives the Appellate Division power to make any order for the ends of justice. He pointed that such powers are provided in the Rules of Procedure of Courts and not in Constitutions. He also pointed that there had been no cogent reply to the petitioner’s submission that the High Court had grossly erred in holding that the petitioner was not entitled to natural justice, in total disregard of his fundamental right guaranteed by Article 31 of the Constitution to receive a notice before any action was taken affecting his continuance in a post. The High Court Division had also totally disregarded the prayer for enforcement of the petitioner’s fundamental right guaranteed by Article 31. Not a single sentence was devoted to this prayer.
Finally Dr. Hossain pointed out that because there was summary rejection and proper judicial process were not observed in the High Court there were contradictory positions presented on behalf of the Respondents with regard to the invoking of Section 45 of the Bank Companies Act. The Attorney General had argued before the High Court, as recorded in the High Court judgment, that Section 45 was relied upon to make the orders under challenge, but the lawyer for Bangladesh Bank had just today made a totally contradictory submission stating that Section 45 was not at all invoked. In the absence of affidavits by the respondents, the petitioner was having to chase a moving target as the basis of the justification for the orders under challenge kept changing. Dr. Hossain submitted that the High Court’s order was flawed because it had erroneously held that the impugned orders were justified by relying on Section 45 of the Bank Companies Act.
Dr Hossain also pointed out that the Board of Grameen Bank had during the relevant period had among its members two senior Government officials (at the Secretary level) and a Government-appointed Chairman. None of them had ever raised any question regarding the continuance of Professor Yunus as Managing Director on account of age limit.
The High Court Division, therefore, fell into grave error by summary rejection of Prof Yunus’s petition, when so many issues of fact in the context of which the law had to be construed were dealt with without any rule being issued, and without any affidavit-in-opposition being given by the respondents. In this situation, the High Court should have proceeded on the basis that the averments (sworn statements) made by the petitioner were admitted by the Bangladesh Bank and Government. The High Court Division departed from the established constitutional practice and norms followed consistently for decades.
The writ petition for the nine women directors was taken up after conclusion of the writ petitioner filed by Professor Yunus.
Ms Sara Hossain representing the nine elected directors of Grameen Bank submitted that the High Court had committed a gross injustice in giving them no hearing and in rejecting their petition with a perfunctory order stating that since Professor Yunus has no standing, they too had ‘no better right’.
This was a gross injustice as these directors are elected by the over 8 million women shareholders of Grameen Bank, who own over 90 per cent of the shares in and are the owners Grameen Bank. The High Court had by dismissing these Petitioners and refusing to hear any submissions or on their behalf, and the Attorney General by his contemptuous remarks regarding Grameen Bank had failed to understand the special and unique nature of Grameen Bank and why it is held in such esteem across the country and globally and why Professor Yunus and his colleagues there have earned such universal respect. Grameen Bank is not, contrary to the Bangladesh Bank’s assertions, a Government-owned bank. It is a bank owned by poor citizens of Bangladesh. The Directors as their elected representatives had come to this Court to protect their interests. Further, as elected directors they had rights under the law to manage the Bank. As Board Members, they had the powers to appoint and remove the Managing Director, and to make regulations fixing the terms and conditions of service. Their right to challenge the Bangladesh Bank’s order is separate and distinct from that of Professor Yunus as Managing Director. While the orders under challenge affect Professor Yunus’ service in the Bank, they affect the Directors statutory rights to as Board Members to decide on issues of management regarding the Grameen Bank in particular regarding the service and tenure of the Managing Director. The orders under challenge amount to usurpation of their rights.
The nine Directors are remarkable women, who became members of Grameen in order to overcome extreme poverty and hardship, and through their involvement in the Bank have brought about a total transformation in their own lives and those of their families. Unlike those in positions of power and privilege seeking to take arbitrary action against the Bank, these nine Directors have fought their way through poverty and hardship, and now play a role in running the Bank for the Poor. It is to protect this Bank and to prevent usurpation of their powers that they had sought the protection of the Court.
The Court adjourned at 1.30pm.
Sara Hossain
Advocate
