Review of Administrative Decisions on the Merits

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1 Review of Administrative Decisions on the Merits By Neil Williams SC 28 October For the practitioner, administrative law matters usually start with a disaffected client clutching the terms of a decision that the client regards as adverse. Consideration of the matter must start with the terms of the decision. 2. If there is a statement of reasons already, an efficient way of approaching it is to start with the conclusions in the last few pages, and make a brief note of the key conclusions, especially those that are adverse. 3. With the benefit of that note, start from the beginning of the decision. What power has purportedly been exercised? What claims, or grounds for the favourable exercise of the power, were put forward by the client? Briefly note these on the way through, with a view to comparing the key conclusions. 4. Have all claims been considered by the tribunal? What evidence was relied upon for the findings of fact? Was your client aware of all adverse material prior to the decision? 5. If the client does not have a statement of reasons, he or she will usually at least have a letter that identifies the power that has been exercised. Turn up the relevant Act, regulation or subordinate instrument, or if applicable, all three. 6. Is there a right to reasons? The Administrative Decisions (Judicial Review) Act 1977 by s 13 confers such a right in respect of decisions to which that section applies. Broadly, decisions of an administrative character made under an enactment are decisions to which the section applies: s 13(11). Decisions can be excluded from the duty to give reasons by their insertion into Schedule 2 to the ADJR Act, or by exclusion in the Act which confers the decision-making power. 7. A second right to reasons is conferred by s 28 of the Administrative Appeals Tribunal Act 1975, for any decision in respect of which an application may be made to the Tribunal for review. The notification letter should refer to the existence of review rights: AAT Act s 27A. The New South Wales Bar Association - Professional Development Department Page 1 of 9

2 8. Generally, if there is a right to reasons, and reasons have not yet been obtained, a request should be made immediately. The only possible exception is where litigation is imminent or has been commenced, and the statement of reasons might be used to supplement or patch up inadequacies in the documentation that was placed before the decision-maker. 9. Such an exercise in reconstruction of the actual reasons is, of course, impermissible, and may attract judicial criticism if it can be shown: see, for example, Phosphate Resources Limited v Minister for the Environment, Heritage and the Arts (No 2) [2008] FCA 1521 at [163] [ 173]. 10. A statement of reasons that is not supported by an affidavit of the decision-maker is not admissible in judicial review proceedings if tendered on behalf of the decision-maker if it is objected to, but would be admissible if tendered by the applicant for judicial review, as an admission: see Minister for Immigration and Ethnic Affairs v Taveli (1990) 23 FCR Both s 13 ADJR Act and s 28 AAT Act are subject to exceptions, and the terms of the section should be checked before making a request. 12. Note s 25D Acts Interpretation Act 1901 (C th). A statement of reasons must include findings on material questions of fact and refer to the evidence or other material on which they are based. 13. Once you have located the statutory source of power, check whether there is a right to merits review. This will generally be conferred by the statute itself, and in express terms. All administrative law practices have a jurisdiction list, a table that sets out every power in respect of which a right to AAT review is conferred. 14. A right to AAT review must be specifically conferred: see s 25 AAT Act. Contrast judicial review, where broad classes of decisions attract review rights: under the ADJR Act, for example, decisions of an administrative character made under an enactment; under s 39B Judiciary Act 1903, decisions in respect of which the specified relief is sought against an officer of the Commonwealth or, under subsection (1A) in respect of a matter arising under a law of the Commonwealth. The New South Wales Bar Association - Professional Development Department Page 2 of 9

3 15. In most cases it will be apparent that there is a right to merit review because the letter notifying of the decision will say so, an obligation which is imposed upon the person who makes a reviewable decision by s 27A of the AAT Act. 16. Having identified the power purportedly exercised, focus upon the particular provision itself. Check if any of the key terms are defined double check this electronically for hypertext links to obscurely-located definitions. 17. Does the provision itself contain preconditions to the exercise of the power? Have those preconditions been satisfied in your client s case? Are there criteria for the exercise of the power, matters to which the decision-maker shall have regard, or matters the decisionmaker is not to take into account? Matters to which the decision-maker is to have regard give weight to as fundamental elements in the decision : R v Hunt; Ex parte Sean Investments (1979) 180 CLR 322 at Having reviewed the particular provision closely, review the immediate context of the power: the Part, Division and Subdivision in which it appears. Then review the objects clause, long title, and the broad structure of the Act, as disclosed in the table of contents. 19. After this review of the decision and the relevant legislation, which in most cases can be completed within an hour or two, you will have most of the information you need to make an assessment of how best to move forward. If the decision contains an administrative law error, your client will have a judicial review option. The main categories of administrative law error are catalogued in the ADJR Act, s5. Merit or Judicial Review? 20. Outside the tax field, if there is a right to merit review it is generally better for the client to pursue it in preference to judicial review, except where on the facts found the law properly applied mandates a decision in your client s favour. First, it is often cheaper, although before the Tribunal there may be extensive evidence, depending on the class of the matter. The New South Wales Bar Association - Professional Development Department Page 3 of 9

4 21. In judicial review, by contrast, the evidence is by and large confined to the material that was before the decision-maker, with limited exceptions. Thus, judicial review applications last typically half a day to two days. Some AAT hearings run for weeks. 22. Secondly, before the AAT all relevant questions of fact are open. By contrast, the scope of judicial review of findings of fact is very limited. 23. Thirdly, the client can still seek judicial review of the decision of the Tribunal if dissatisfied, under s 44 of the AAT Act, and potentially at least under the more general judicial review statutes. 24. Fourthly, if your client succeeds in the AAT it is likely to get the decision it wants. By contrast, with judicial review the usual order is for remittal of the matter to the decisionmaker to be dealt with according to law. The decision-maker may reach the same conclusion again. 25. The question is more complex in respect of taxation matters. Because the Tribunal stands in the shoes of the decision-maker and can, generally, exercise all the powers and functions that the decision-maker had in exercising its review function, the Tribunal can exercise for itself those powers of the Commissioner of Taxation that are expressed in subjective terms matters depending upon the opinion or satisfaction of the Commissioner. 26. This can include, for example, making a Part IVA determination, even if the Commissioner had not made one, subject only to according the tax payer procedural fairness: see Fletcher v Commissioner of Taxation (1988) 19 FCR Where such a determination might have been made on the facts, but has not been, it will generally be prudent for the taxpayer to pursue its review rights under Part IVC of the Taxation Administration Act 1953 through the Federal Court, rather than opting for AAT review. This will eliminate the risk of a Part IVA determination being made in the course of the review proceeding itself. The Federal Court has no power to make such a determination. 28. Another circumstance in which it may be preferable for the taxpayer to pursue its review in the Federal Court rather than it the Tribunal is where a subjective decision made as part The New South Wales Bar Association - Professional Development Department Page 4 of 9

5 of the assessment process has been made on manifestly legally erroneous grounds, or without sufficient evidence. 29. The Federal Court can undertake a form of judicial review of the subjective decision in the course of the Part IVC appeal, and can set it aside on traditional administrative law grounds : see Avon Downs v Commissioner of Taxation (1949) 78 CLR 353 at If the subjective decision has adverse consequences for the taxpayer s liability, that course will be preferable to proceeding in the Tribunal. The Tribunal might remake the decision, but upon better evidence, or on more legally defensible grounds. Tribunal Procedure 31. The procedure for commencing AAT proceedings is simple: there is a form. The Tribunal has a good website on which the application form can be found, with a range of useful material, including the speeches of the President, which give an insight into the Tribunal s approach on a variety of issues. 32. The scope of any review is determined by the conferral of power. Commonly, it is simply a power to review a decision made under a specified section or subsection. But note, for example, s 14ZZ of the Taxation Administration Act. The right of review in respect of tax decisions is to review the Commissioner s objection decision, not the making of the assessment. The grounds of review are limited by s 14ZZK, subject to the Tribunal s discretion to permit new grounds. The Commissioner then implements the Tribunal s decision by amending any assessment or determination as required: see s 14ZZL. 33. The Tribunal exercises all the powers and discretions conferred on the person who made the decision, and affirms, varies or sets aside the decision under review and substitutes its own decision or remits it for consideration: see s 43(a) AAT Act. 34. The Tribunal has power to review a purported decision, even if it concludes that the decision-maker did not have power to make the decision in the first place: see Re Brian Lawlor Automotive Pty Ltd v Collector of Customs (1978) 1 ALD at 167, per Brennan J. In that circumstance, the power of the Tribunal under s 43 includes power to set aside a decision and to make no decision in substitution for it. The New South Wales Bar Association - Professional Development Department Page 5 of 9

6 35. By s 33 of the AAT Act the Tribunal is obliged to proceed with as little formality and technicality, and with as much expedition, as the requirements of relevant legislation and a proper consideration of the matters before it permit, and is not bound by the rules of evidence but may inform itself on any matter in such manner as it thinks appropriate. 36. What this means in a practical sense depends on the nature of the review, and the questions at issue. Where, for example, allegations of serious criminality are advanced as reasons for upholding a deportation order, the Tribunal is likely to proceed in a quite formal manner, and to require proof in a way that does not differ greatly from that applied in a criminal court: see Pochi v Minister for Immigration and Ethnic Affairs (1979) 2 ALD 33; 26 ALR 247, per Brennan J; Re Salters (2000) 31 AAR 500 per Forgie DP ( rejecting the tender of the transcript of an interview in proceedings about the registration of a migration agent). "The Tribunal Dilemma : Rigorous Informality", The Hon. Justice Garry Downes AM, The Second Professor Harry Whitmore Lecture, delivered at the Annual General Meeting of the Council of Australasian Tribunals, The Australian Museum, Sydney, 17 September The bulk of the material before the Tribunal in a typical case will be that which was before the decision-maker, referred to as the T docs. The decision-maker is obliged by s 37 to lodge that material within 28 days after receiving notice of the application. That material must include the statement of reasons. 38. The Tribunal s obligation is to arrive at the correct or preferable decision based upon the evidence before it: Drake v Minister for Immigration and Ethnic Affairs (1979) 2 ALD 60; 24 ALR 577 at 589 per Bowen CJ and Deane J. 39. For this purpose the Tribunal may conduct a hearing de novo, requiring the applicant to make out a case, including by tendering evidence and calling witnesses. The Tribunal is in no sense restricted to the evidence that was before the primary decision-maker, and is generally not not restricted to evidence, or facts, that predated the original decision: see, for example, Shi v Migration Agents Registration Authority (2008) 248 ALR The terms, or the statutory context, of the power being exercised might require that the decision upon review be taken by reference to facts and matters existing as at the time of decision. This, however, is very much the exception. The New South Wales Bar Association - Professional Development Department Page 6 of 9

7 41. Subject to any contrary intention in the amending Act, especially in the transitional provisions, the Tribunal will apply the law as at the date of the decision as well. 42. However, the Tribunal is generally not obliged to make a finding as to an applicant s entitlement as at the date of the Tribunal s decision. The issue is generally whether, having regard to all the facts placed before the Tribunal, including evidence that came into existence after the decision and was not before the primary decision-maker, the decision taken was the correct or preferable decision. See Freeman v Department of Social Security (1988) 19 FCR The concept of onus of proof is not applicable in AAT proceedings, the question being the correct or preferable decision, applying the relevant statutory criteria: McDonald v Director-General of Social Security (1984) 1 FCR As to experts, the Tribunal like the Federal Court will often take concurrent evidence: see for example International Fund for Animal Welfare (Australia) Pty Ltd and Minister for Environment and Heritage, Re (2005) 93 ALD 594; (2005) 41 AAR 508; [2005] AATA 1210 at [43]-[45]. A draft opinion evidence practice direction is available for discussion purposes at present. 45. However, the NSW practice of engaging a single court-appointed expert has not found favour in the AAT: "Expert Witnesses in Proceedings in the Administrative Appeals Tribunal", The Hon. Justice Garry Downes AM, Paper delivered to the NSW Bar Association Administrative Law Section, Sydney, 22 March 2006; "Concurrent Expert Evidence in the Administrative Appeals Tribunal : The New South Wales Experience", The Hon. Justice Garry Downes AM, Paper presented at the Australasian Conference of Planning and Environment Courts and Tribunals, Hobart, 27 February Arguing an Application 46. The fact that the Tribunal has power to undertake a de novo review, and is not restricted to the material before the decision-maker, does not mean that the primary decision should be ignored. The Tribunal will generally want to know, at least briefly, what the basis of the decision was. The New South Wales Bar Association - Professional Development Department Page 7 of 9

8 47. For the advocate appearing for an applicant, this provides an opportunity to demonstrate error in the respondent s approach in opening address. Particularly if the error, or any unfairness of approach, is egregious, there are advantages in giving some brief emphasis to this in opening. 48. In general, in merit review matters, as in virtually all cases, the opening confers significant advantages upon the moving party, it being an opportunity to paint the broad picture for the Tribunal of the issues that will determine the application. 49. While the opening is a significant advantage, it is important not to overstate the client s case, or to ignore entirely the points the respondent will wish to make. Rather, the opening is the occasion for exposing those points, and indicating briefly what the applicant s answer to them is. Tribunals, like courts, are grateful for an opening that contains a significant measure of balance, providing them with an accurate idea of the matters they will have to deal with. 50. Practice varies among Tribunal members in relation to the Tdocuments. Some Tribunal members take them as read ; it is prudent to tender them nevertheless, perhaps in saying something like I am not sure whether your preferred practice is for the T documents to be marked as an exhibit, but for the record I tender them. 51. The Tribunal has a series of practice directions, including a General Practice Direction. It is important to read these before embarking on any AAT matter. 52. Tribunal directions generally require the filing of a statement of facts, issues and contentions, although the name to be given to that document may vary according to the Tribunal member. There is much to be said for treating this document rather like a pleading, setting out the matters in some detail, but including issues of law as well. If issues can be defined early, the scope of evidence and argument might be reduced. 53. Although individual practice varies, I address Tribunal members by their title. Unless they are judges (your Honour): Deputy President, Senior Member, Tribunal Member. If there is more than one, I refer to them as the Tribunal. The New South Wales Bar Association - Professional Development Department Page 8 of 9

9 Appearing for Respondents 54. The Tribunal has always expected respondents to give it substantial assistance in deciding matters: see Re Hungerford and Repatriation Commission (1990) 21 ALD 568 at In recent times that expectation has grown, and been given legislative form in s33 (1AA), requiring a decision-maker to use his or her best endeavours to assist the Tribunal in relation to the proceeding. 55. This presents a challenge to the advocate in simultaneously conducting the hearing in a balanced manner, while advocating for the position of a client agency which might have a very strong interest in the outcome of the hearing, and very fixed views about the appropriate outcome. 56. Counsel for the respondent in the Tribunal is in a position not unlike that of a prosecutor in a criminal trial. But while the role has its difficulties, Tribunal members tend very much to appreciate the even-handed assistance that they receive from time to time from respondents representatives. 57. There is no necessary inconsistency between advocating your client s position strongly, and giving the Tribunal even-handed assistance with the issues before it, although the client will not necessarily see it in that way unless you explain it to them in advance. 58. For those appearing for a respondent before the Tribunal, the following article is essential reading: "Government Agencies as Respondents in the Administrative Appeals Tribunal", The Hon. Justice Garry Downes AM, Paper delivered to the Australian Government Solicitor Government Law Group, Canberra, 16 June The New South Wales Bar Association - Professional Development Department Page 9 of 9

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