Australian Workers' Union v Registered Organisations Commissioner (No 9)
[2019] FCA 1671
•11 October 2019
FEDERAL COURT OF AUSTRALIA
Australian Workers’ Union v Registered Organisations Commissioner (No 9) [2019] FCA 1671
File number: VID 1151 of 2017 Judge: BROMBERG J Date of judgment: 11 October 2019 Catchwords: INDUSTRIAL LAW - Fair Work (Registered Organisations) Act 2009 (Cth) (“RO Act”): s 331(2), power of Commissioner of Registered Organisations to conduct an investigation as to whether a civil penalty provision has been contravened if satisfied reasonable grounds for doing so – where Commissioner commenced investigation as to whether ss 237, 285, 286 and 287 of the RO Act contravened by reason of various donations made by a registered organisation; where reasonable grounds for investigation based on contravention of rules of the registered organisation – consideration of ss 237, 285, 286 and 287 of RO Act dealing with financial reporting and financial management of registered organisations – consideration of s 320 and 321 of RO Act dealing with validation after 4 years of acts in contravention of rules – discussion of legislative history of RO Act.
ADMINISTRATIVE LAW – whether Commissioner’s decision to conduct investigation affected by jurisdictional error.
Excess of Power: where s 331(2) power to investigate conferred on Commissioner following amendment to RO Act – whether s 331(2) qualified by a temporal restriction limiting Commissioner’s power to conduct investigations to conduct post-dating conferral of investigation power upon Commissioner – statutory interpretation – discussion of legislative history of RO Act: ss 331, 305 – whether a transitional provision expressly limited Commissioner’s power – whether principle of legality attracted – whether presumption against retrospectivity attracted – whether amendment to s 305 altered operation of provisions listed in s 305 so they no longer operated as civil penalty provisions prior to amendment – discussion of ss 7(2)(b) and (e) of Acts Interpretation Act 1901 (Cth) – decision to conduct investigation not invalid on this ground.
Formation of requisite state of satisfaction: whether Commissioner validly “satisfied that there are reasonable grounds” for conducting an investigation into whether ss 237, 285, 286 and 287 of the RO Act contravened – discussion of relevant principles for assessing whether formation of a statutory state of satisfaction is affected by jurisdictional error – where reasons are given by the decision-maker which explain the basis for the decision‑maker reaching the requisite state of satisfaction – whether Commissioner’s basis for satisfaction that “reasonable grounds” existed sufficient to induce that state of mind in a reasonable person – where (in relation to ss 285, 286 and 287 but not 237) “reasonable grounds” of Commissioner based on acts suspected to have been done in contravention of the rules of the registered organisation – whether Commissioner’s ground for suspicion can sustain the opinion that there were “reasonable grounds” to conduct an investigation in circumstances where by the operation of s 320 of RO Act the suspected acts in question, if done, must be “taken to have been done in compliance with the rules of the organisation” – whether Commissioner misunderstood law he sought to apply – decision to conduct an investigation into whether ss 285, 286 and 287 of RO Act had been contravened invalid.
Improper purpose: whether decision to conduct an investigation invalidated by improper purpose – whether Commissioner had the improper purpose of aiding in, assisting or promoting an alleged improper political purpose of Minister for Employment (“Minister”) to embarrass or politically harm her political opponent – discussion of applicable legal principles regarding improper purpose – holding of improper purpose not demonstrated on the evidence – decision to conduct an investigation not invalid on this ground.
Irrelevant consideration: whether irrelevant consideration taken into account in decision to conduct investigation – where irrelevant consideration alleged is Minister’s alleged political purpose – taking irrelevant consideration into account not demonstrated on the evidence – decision to conduct an investigation not invalid on basis of this ground.
Dictation: whether investigation commenced at direction of Minister – discussion of principles of dictation ground of jurisdictional error – extent to which the repository of the power to investigate conferred by s 331(2) of RO Act may be permissibly influenced or directed by the views of the Minister – whether Minister’s views were a material and operative reason for Commissioner’s decision to investigate – decision to conduct an investigation not invalid on basis of this ground.ADMINISTRATIVE LAW – RO Act ss 335K and 335L: application by Commissioner in course of his investigation for issuance of search warrants – whether search warrants invalidly issued where decision to conduct an investigation invalid.
Legislation: Acts Interpretation Act 1901 (Cth): ss 7(2)(b), 7(2)(e)
Evidence Act 1995 (Cth) s 55, 140
Fair Work (Registered Organisations) Act 2009 (Cth): ss 5, 140(1), 149(1), 237(1), 285(1), 286(1), 287(1), 305, 305(2), 310(1), 317, 320, 320(1), 320(1)(a)(i), 320(1)(a)(ii), 329AA, 329AB, 329DA, 329DB, 329CA(1), 329DC, 329FA, 330, 330(1), 330(2), 331, 331(1), 331(2), 335D(3), 335K, 335L 337(1)(d)(i), 337AD, 338
Fair Work (Registered Organisations) Amendment Act 2016 (Cth), Item 130 of Sch 1
Cases cited: A v Corruption and Crime Commissioner [2013] WASCA 288
Ashby v Slipper (2014) 219 FCR 322
Attorney-General (Q) v Australian Industrial Relations Commission (2002) 213 CLR 485
Australian Conservation Foundation v Forestry Commission (1988) 19 FCR 127
Australian Education Union v Fair Work Australia (2012) 246 CLR 117
Bailey v Krantz (1985) 13 IR 339
Bread Manufacturers of NSW v Evans (1980) 180 CLR 404
Briginshaw v Briginshaw (1938) 60 CLR 336
Caratti v Commissioner of the Australian Federal Police (2017) 257 FCR 166
Commissioner for Corporate Affairs v X and Y [1987] VR 460
Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Australian Competition and Consumer Commission (2007) 162 FCR 466
Cotterill v Minister for Immigration and Border Protection (2016) 240 FCR 29
CPCF v Minister for Immigration and Border Protection (2015) 255 CLR 514
E and J Gallo Winery v Lion Nathan Australia Pty Ltd (2010) 241 CLR 144
Egan v Harradine (1975) 25 FLR 336
Emirates v Australian Competition and Consumer Commission [2009] FCA 312
Essendon Football Club v Chief Executive Officer of the Australian Sports Anti-Doping Authority (2014) 227 FCR 1
FGT Custodians Pty Ltd v Fagenblat [2003] VSCA 33
Geneff v Peterson (1986) 19 IR 40 at 76
George v Rockett (1990) 170 CLR 104
Gill v Minister for Immigration and Border Protection (2017) 250 FCR 309
Graham v Minister for Immigration and Border Protection (2017) 263 CLR 1
HK Systems Australia Pty Ltd v Debus (2008) 169 FCR 46
Hossain v Minister for Immigration and Border Protection [2018] HCA 34
Hunter v The Minister for Planning [2012] WASC 247
Industrial Equity Ltd v Deputy Commissioner of Taxation (1990) 170 CLR 649
Jones v Dunkel (1959) 101 CLR 298
Lodestar Anstalt v Campari America LLC (2016) 244 FCR 557
McKinnon v Department of Treasury (2006) 228 CLR 423
Melbourne Home of Ford Pty Ltd v Trade Practices Commission (No 3) (1980) 31 ALR 519
Minister for Aboriginal Affairs v Peko‑Wallsend Ltd (1986) 162 CLR 24
Minister for Foreign Affairs v Lee (2014) 227 FCR 279
Minister for Immigration and Border Protection v Haq [2019] FCAFC 7
Minister for Immigration and Border Protection v Stretton (2016) 237 FCR 1
Minister for Immigration and Border Protection v Singh (2014) 231 FCR 437
Minister for Immigration and Border Protection v SZVFW [2018] HCA 30
Minister for Immigration and Citizenship v Li (2013) 249 CLR 332
Minister for Immigration and Multicultural Affairs v Eshetu (1999) 197 CLR 611
North Australian Aboriginal Justice Agency Ltd v Northern Territory (2015) 256 CLR 569
Palmer Leisure Coolum Pty Ltd v Magistrates Court of Queensland [2019] QSC 8
Plaintiff S4/2014 v Minister for Immigration and Border Protection (2014) 253 CLR 219
Prior v Mole (2017) 261 CLR 265
Prichard v Krantz (1983) 5 IR 437
R v Anderson; Ex parte Ipec-Air Pty Ltd (1965) 113 CLR 177
R v Commonwealth Court of Conciliation Arbitration; Ex parte Barrett (1945) 70 CLR 141
R v Connell; Ex parte Hetton Bellbird Collieries Ltd (1944) 69 CLR 407
R v Rogerson (1992) 174 CLR 268
Re Application for Inquiry into Election in Australian Workers’ Union (1982) 2 IR 69
Re McJannet; Ex parte Australian Workers’ Union of Employees, Queensland [No 2] (1997) 189 CLR 654
Robertson v City of Nunawading [1973] VR 819
SingaporeAirlines Ltd v Australian Competition and Consumer Commission [2009] FCAFC 136
Universal Music Australia Pty Ltd v Australia Competition and Consumer Commission (2003) 131 FCR 529
Wong v Commissioner, Australian Federal Police [2014] FCA 443
Date of hearing: 11-15, 18, 25, 28 February 2019 and 1, 8 March 2019 Registry: Victoria Division: Fair Work Division National Practice Area: Employment & Industrial Relations Category: Catchwords Number of paragraphs: 393 Counsel for the Applicant: Mr H Borenstein QC with Ms C Van Proctor and Mr C Tran Solicitor for the Applicant: Maurice Blackburn Counsel for the First Respondent: Mr F Parry QC with Mr M Follett Solicitor for the First Respondent: Ashurst Counsel for the Second Respondent: The Second Respondent did not appear Counsel for Senator the Honourable Michaelia Cash (subpoena recipient) Mr C Horan QC with Mr B Jellis Solicitor for Senator the Honourable Michaelia Cash (subpoena recipient) MinterEllison Counsel for Mr M Lee (subpoena recipient) Mr G Boas Solicitor for Mr M Lee (subpoena recipient) Corrs Chambers Westgarth Counsel for Mr B Davies (subpoena recipient) Mr R Dalton SC with Mr N Burmeister Solicitor for Mr B Davies (subpoena recipient) Kennedys Counsel for Mr D De Garis (subpoena recipient) Mr J MacLaurin Solicitor for Mr D De Garis (subpoena recipient) Equitas Lawyers ORDERS
VID 1151 of 2017 BETWEEN: THE AUSTRALIAN WORKERS’ UNION
Applicant
AND: REGISTERED ORGANISATIONS COMMISSIONER
First Respondent
COMMISSIONER OF THE AUSTRALIAN FEDERAL POLICE
Second Respondent
JUDGE:
BROMBERG J
DATE OF ORDER:
11 october 2019
THE COURT ORDERS THAT:
1.The proceeding be listed for further hearing on a date to be fixed and on an estimate of half a day.
2.On or before 14 days prior to the further hearing, the applicant file and serve any further submissions addressing the matters raised by [385]-[391] of the Court’s reasons published on 11 October 2019, as well as a Minute setting out the orders that should be made to give effect to those reasons.
3.On or before 7 days prior to the further hearing, the respondents file and serve any further submissions addressing the matters raised by [385]-[391] of the Court’s reasons, as well as a Minute setting out the orders that should be made to give effect to those reasons.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
ground 1 – Can the Commissioner investigate “historical conduct” ocurring prior to 1 May 2017?
[15]
The Competing Contentions and Relevant Legislative Provisions
[15]
Deliberation
[39]
ground 2 – Was the Commissioner validly satisfied that there were reasonable grounds for conducting the Investigation?
[76]
Relevant Legislative Provisions
[77]
The AWU’s Contentions
[84]
Deliberation – The Relevant Principles
[87]
Deliberation – Application of the Principles to the Facts
[96]
Grounds 3, 4 and 5 – Was the decision to conduct the Investigation invalidated by an improper political purpose, an irrelevant consideration or an impermissible direction?
[173]
The Nature of the Relationship between the Commissioner and the Minister under the RO Act
[174]
The Facts
[179]
Events of 12 to 14 August 2017
[182]
Events of 15 August 2017
[189]
Events of 16 August 2017
[195]
Events of 17 August 2017
[205]
Events of 18 August 2017
[209]
Events from 22 to 29 August 2017
[214]
Events of September 2017
[221]
Events of October 2017
[229]
Ground 3 – Was the Investigation Commenced for an Improper Political Purpose?
[261]
AWU’s Contentions
[261]
Applicable Legal Principles
[262]
Deliberation
[264]
Mr Enright’s Knowledge or Understanding of the Minister’s Political Purpose
[269]
Did Mr Enright Seek to “accommodate” the Minister?
[282]
Was Mr Enright Transparent about his Communications with the Minister’s Office?
[295]
Mr Enright’s Visit to the Minister’s Office
[310]
Mr Enright’s View that s 320 was Inapplicable
[315]
Improper Regard to “referrals” from the Minister
[325]
The Leak to the Media
[326]
The Reliability of Mr Enright’s Evidence
[338]
Where is the Motive?
[342]
Conclusion on Ground 3
[344]
Ground 4 – Was an Irrelevant Consideration Taken into Account?
[347]
Ground 5 – Was the Investigation Commenced at the Direction of the Minister?
[351]
The Applicable Legal Principles
[353]
The AWU’s Contentions
[356]
Deliberation
[357]
Ground 6 and 7 and the Relief Sought by the AWU [378] conclusion
[392]
Appendix 1
BROMBERG J:
The Fair Work (Registered Organisations) Act 2009 (Cth) (“RO Act”) provides for the formation of associations of employees and associations of employers and for the registration of those associations as registered organisations. In setting out Parliament’s intention in enacting the RO Act, s 5 of that Act records that registered organisations are required to meet standards set out in the Act including standards which “encourage the efficient management of organisations and high standards of accountability of organisations to their members” (s 5(3)(c)). Regulatory processes are provided for by the RO Act and facilitated by the establishment of the office of the first respondent, the Registered Organisations Commissioner (“Commissioner”) (s 329AA). The functions of the Commissioner are specified by s 329AB and include to promote “efficient management of organisations and high standards of accountability of organisations and their office holders to their members”; and also to promote “compliance with financial reporting and accountability requirements” of the RO Act (s 329AB(a)).
The RO Act also establishes the Registered Organisations Commission (“Commission”) (s 329DA). As s 329DB specifies, the Commission consists of the Commissioner and any staff assisting the Commissioner as mentioned in s 329CA(1). The function of the Commission is to “assist the Commissioner in the performance of the Commissioner’s functions” (s 329DC).
At all relevant times the Minister with oversight responsibility for the Commission was Senator the Honourable Michaelia Cash, the Minister for Employment (“Minister Cash” or “Minister”).
The applicant (“AWU”) is an association of employees registered as an organisation under the RO Act.
Section 331 of the RO Act empowers the Commissioner to conduct investigations. Relevantly, s 331(2) provides:
(2)If the Commissioner is satisfied that there are reasonable grounds for doing so, the Commissioner may conduct an investigation as to whether a civil penalty provision (see section 305) has been contravened.
On 20 October 2017, Mr Chris Enright, the Executive Director of the Commission and a delegate of the Commissioner decided (“Decision”) to conduct an investigation (“Investigation”) described by the decision record made by him (“Decision Record”) as “an investigation under section 331(2) of the [RO Act] in relation to the National Office and Victorian Branch of [the AWU] as to whether various civil penalty provisions within the meaning of section 305 have been contravened”. Mr Enright’s Decision Record identified the matters that the Investigation related to. Those matters included a donation of $50,000 from the National Office of the AWU to GetUp Limited (“GetUp”) during the financial year ending 30 June 2006; a donation of $50,000 from the Victorian Branch of the AWU to GetUp during the financial year ending 30 June 2006; and fifteen other donations made by the AWU in the financial year ending 30 June 2008 to persons or entities associated with the Australian Labour Party (“ALP”) (collectively “Donations”). The Decision Record identifies that the making of the Donations involved possible contraventions of ss 237(1), 285(1), 286(1) and 287(1) of what was Schedule 1B of the Workplace Relations Act 1996 (Cth) (“WR Act”) and which later became Schedule 1 of the WR Act. Section 237 deals with a financial reporting requirement, namely an obligation imposed on registered organisations to file within a specified time a statement of particulars of any loans, grants or donations made in a particular financial year. Sections 285 to 287 deal with financial probity obligations and impose care, diligence and good faith obligations upon the officers of organisations and protect against the misuse by an officer of his or her office.
Those provisions were in the following terms:
237 Organisations to notify particulars of loans, grants and donations
(1)An organisation must, within 90 days after the end of each financial year (or such longer period as the Registrar allows), lodge in the Industrial Registry a statement showing the relevant particulars in relation to each loan, grant or donation of an amount exceeding $1,000 made by the organisation during the financial year.
Note: This subsection is a civil penalty provision (see section 305).
…
285 Care and diligence—civil obligation only
(1)An officer of an organisation or a branch must exercise his or her powers and discharge his or her duties with the degree of care and diligence that a reasonable person would exercise if he or she:
(a)were an officer of an organisation or a branch in the organisation’s circumstances; and
(b)occupied the office held by, and had the same responsibilities within the organisation or a branch as, the officer.
Note: This subsection is a civil penalty provision (see section 305).
...
286 Good faith—civil obligations
(1)An officer of an organisation or a branch must exercise his or her powers and discharge his or her duties:
(a)in good faith in what he or she believes to be the best interests of the organisation; and
(b) for a proper purpose.
Note: This subsection is a civil penalty provision (see section 305).
...
287 Use of position—civil obligations
(1)An officer or employee of an organisation or a branch must not improperly use his or her position to:
(a) gain an advantage for himself or herself or someone else; or
(b) cause detriment to the organisation or to another person.
Note: This subsection is a civil penalty provision (see section 305).
On 24 October 2017, upon the application of the Commissioner under s 335K of the RO Act, a magistrate issued a warrant authorising officers of the second respondent (“AFP”) to search the premises of the National Office of the AWU in Sydney, and a warrant authorising officers of the AFP to search the premises of the Victorian Branch of the AWU in Melbourne (collectively “search warrants”). Later that day, officers of the AFP accompanied by representatives of the Commissioner executed the search warrants at each of the National and Victorian Branch offices of the AWU. In the execution of the search warrants, the AFP took possession of various documents.
On 25 October 2017, the AWU filed an originating application in this Court seeking relief in relation to the acts and decisions of the Commissioner and the AFP referred to above. In summary, the AWU seeks, among other things:
(i)a declaration that the Decision of the Commissioner (by his delegate) to conduct the Investigation is invalid, and orders in the nature of certiorari and prohibition quashing that Decision and prohibiting the Commissioner from giving further effect to it;
(ii)a declaration that the search warrants are invalid, and an order in the nature of prohibition or an injunction preventing the AFP from giving further effect to either of the warrants; and
(iii)an injunction requiring the AFP to return to the AWU the documents seized in the execution of the search warrants.
The AWU challenged the Investigation on the basis of five grounds which are set out in the AWU’s Grounds of Review dated 13 February 2019, the substance of which are as follows:
Ground 1 - That the Commissioner’s decision to conduct the Investigation under s 331(2) of the RO Act was affected by jurisdictional error, because he purported to investigate conduct occurring before 1 May 2017 whereas the provision (s 331(2)) is limited to investigating whether a civil penalty provision has been contravened after 1 May 2017.
Ground 2 - That the Commissioner’s decision to conduct the Investigation under s 331(2) of the RO Act was affected by jurisdictional error, because:
(i)it was not open to the Commissioner to be satisfied that there were “reasonable grounds” to conduct an investigation for breach of the AWU’s rules, due to the operation of s 320 of the RO Act;
(ii)further or alternatively, in not adverting to s 320 of the RO Act, the Commissioner misunderstood the law he was to apply.
Ground 3 - That the Commissioner’s decision to conduct the Investigation under s 331(2) of the RO Act was affected by jurisdictional error, because a decision was made for an improper political purpose (“improper purpose”) of aiding in, assisting or promoting the political purpose of Minister Cash and or members of her office (“Minister Cash’s political purpose”) who wanted the AWU to be investigated by the Commissioner in order to discredit, embarrass or politically harm the Honourable Bill Shorten MP (“Mr Shorten”).
Ground 4 - That the Commissioner’s decision to conduct the Investigation under s 331(2) of the RO Act was affected by jurisdictional error, because the Decision was made taking into account a mandatory irrelevant (political) consideration, namely Minister Cash’s political purpose.
Ground 5 - That the Commissioner’s decision to conduct the Investigation under s 331(2) of the RO Act was affected by jurisdictional error, because the Commissioner impermissibly acted upon the advice or direction of Minister Cash.
The AWU also challenged the validity of the search warrants on the basis of three grounds, only two of which were pressed:
Ground 6 - That the warrants are invalid because there was no valid investigation and thus no power to obtain a warrant under s 335K of the RO Act;
Ground 7 - That the warrants are invalid because there was no power for the Commissioner to apply for them in connection with the conduct under investigation (which allegedly occurred before 1 May 2017)
The AFP did not participate in the trial having requested and obtained leave to be excused. The AWU called a number of witnesses who gave evidence in response to subpoenas. Those witnesses included Mr Enright as well as Mr Mark Lee and Mr Greg Russo each of whom were involved in assisting the Commission. Additionally, the AWU called Minister Cash and members or former members of her staff – Mr Ben Davies and Mr David De Garis. The Commissioner did not call any witnesses. A large number of documents were tendered.
In the main, the evidentiary case which the AWU sought to establish was relevant to grounds 3, 4 and 5. The other grounds for review challenging the Investigation (grounds 1 and 2) largely turn on questions of statutory construction and the proper characterisation of the Decision Record. The grounds which challenge the search warrants (grounds 6-7) are largely contingent on whether the AWU succeeds on its challenge to the validity of the Investigation. It is convenient that I deal with each of the grounds of review in turn and address most of the relevant facts when I deal with grounds 3-5, the resolution of which is largely fact dependent.
There is no issue that the Court has jurisdiction to hear and determine this application or that it has the power to make the orders and declarations sought. Section 338 of the RO Act confers on the Court jurisdiction in relation to any matter arising under that Act. It is not in contest that each of the challenges made to the validity of the Investigation and the validity of the search warrants raise a matter arising under the RO Act, including because the Commissioner’s power to investigate and the power to issue a warrant are conferred by and owe their existence to the RO Act: R v Commonwealth Court of Conciliation Arbitration; Ex parte Barrett (1945) 70 CLR 141 at 154 (Latham CJ); Re McJannet; Ex parte Australian Workers’ Union of Employees, Queensland [No 2] (1997) 189 CLR 654 at 656 (Brennan CJ, McHugh and Gummow JJ).
ground 1 – Can the Commissioner investigate “historical conduct” ocurring prior to 1 May 2017?
The Competing Contentions and Relevant Legislative Provisions
It is not in contest that if it occurred, the conduct the subject of the Investigation occurred during the 2006 and 2008 financial years and therefore prior to 1 May 2017.
The AWU contended that the Commissioner’s power to conduct investigations is qualified by a temporal limitation such that, the Commissioner’s power to conduct investigations under s 331(2) of the RO Act is only enlivened where the Commissioner (or the Commissioner’s delegate) is satisfied that there are reasonable grounds to investigate whether a civil penalty provision has been contravened by conduct occurring after 1 May 2017. In this respect, the AWU contended that the Commissioner’s investigative function was prospective in the sense that it is confined to conduct which post-dated the conferral of that function upon the Commissioner and did not extend to historical conduct, that is, conduct which pre-dated the conferral of the function (“Historical Conduct”).
The first of May 2017 is the date on which Sch 1 of the Fair Work (Registered Organisations) Amendment Act 2016 (Cth) (“RO Amendment Act”) commenced and the date upon which the investigative function in s 331 was conferred upon the Commissioner. Schedule 2 of that Act commenced on 2 May 2017.
Prior to addressing the relevant operation of that Act and in order to provide an understanding of the AWU’s contention, it is necessary to outline in broad terms the legislative history of the provisions in the RO Act of relevance to the proper construction of s 331(2). Unless otherwise stated, a reference to the current terms of a legislative provision is an intended reference to the terms of that provision as at the date of the Decision.
The principal Commonwealth Act dealing with workplace relations is the Fair Work Act 2009 (Cth) (“FW Act”). That Act received Royal Assent on 7 April 2009 and commenced substantially on 1 July 2009. Its legislative predecessor was the WR Act.Unlike the current arrangement, where provisions relating to registered organisations are dealt with by an Act (RO Act) separate from the principal Act (FW Act), the WR Act itself contained the legislative provisions relating to registered organisations. From 12 May 2003 and until 27 March 2006 provisions relating to registered organisations were dealt with in Sch 1B of the WR Act. On and from 27 March 2006, Sch 1B of that Act was renumbered as Sch 1. Unlike the bulk of the WR Act, Sch 1 was not repealed upon the commencement of the FW Act, but was renamed and became the RO Act (Item 3, Pt 1, Sch 22 of the Fair Work Act (Transitional Provisions and Consequential Amendments) Act 2009 (Cth) (“FW (TPCA) Act”).
Neither the Commissioner nor the Commission were referred to in Sch 1 of the WR Act. Section 133 of the WR Act provided for the appointment of an “Industrial Registrar” to exercise powers and functions including those conferred by Sch 1 of the WR Act. Section 141 of the WR Act made the same provision for “Deputy Industrial Registrars”. Section 331 of Sch 1 of the WR Act was in the same terms as the current terms of s 331 of the RO Act, save that the provision empowered “a Registrar” (defined as the Industrial Registrar or a Deputy Industrial Registrar) rather than the “Commissioner” to conduct investigations.
However, s 305 of Sch 1 of the WR Act was in different terms to its current form in the RO Act. Its current form is as follows:
305 Civil penalty provisions
(1)Subject to this Part, an application may be made to the Federal Court for orders under sections 306, 307 and 308 in respect of conduct in contravention of a civil penalty provision.
(2)A civil penalty provision is a subsection, or a section that is not divided into subsections, that has set out at its foot a pecuniary penalty, or penalties, indicated by the words “Civil penalty”.
(3)For the purposes of this Part, any contravention of a civil penalty provision by a branch or reporting unit is taken to be a contravention by the organisation of which the branch or reporting unit is part.
(4)The Federal Court must apply the rules of evidence and procedure for civil matters when hearing and determining an application for an order under this Part.
The terms of s 305 and relevantly s 305(2) in Sch 1 of the WR Act differed because, at that time, a different technique was utilised for identifying which provisions were “civil penalty provisions”. Rather than the current approach in the RO Act of a provision self-identifying itself as a civil penalty provision, in Sch 1 of the WR Act, s 305(2) listed each of the 43 provisions designated to be “civil penalty provisions” and each of those provisions had a note stating “This [section/subsection] is a civil penalty provision (see section 305)”. Accordingly, each of the provisions there listed did not set out at its foot (as is the current approach) the words “Civil penalty”.
When Sch 1 of the WR Act was re-named the RO Act and commenced on 1 July 2009, many of the regulatory functions which had been held by the Industrial Registrar or Deputy Industrial Registrar (including the function under s 331 to conduct investigations) became the functions of an office created by s 656 of the FW Act and titled “General Manager of Fair Work Australia” (from 1 January 2013 “General Manager of the Fair Work Commission”) (“General Manager”). Those amendments were made by the FW (TPCA) Act, and in particular, by Pt 7 of that Act including by Items 540-546 which had the effect of omitting “Registrar” and substituting “the General Manager” wherever appearing in s 331. No transitional provisions addressed the issue of whether the investigation function then conferred upon the General Manager was subject to any temporal limitations, and in particular, limited to prospective conduct rather than conduct which had occurred prior to the conferral of the investigative function.
The FW (TPCA) Act made no amendments to s 237(1), other than substituting “the General Manager” for “the Registrar” and “with FWA” for “in the Industrial Registry” (Item 488 and 489 of Pt 7). No amendments were made to ss 285(1), 286(1) or 287(1).
The office of the General Manager remains an office established under the FW Act. However, the functions and powers of that office were altered in 2016 by the RO Amendment Act.
The office of the Commissioner and the Commission were established by the insertion of Pt 3A into the RO Act. Additionally, amongst other similar amendments, the RO Amendment Act amended s 331 of the RO Act, dealing with the conduct of investigations, by omitting “General Manager” wherever occurring and substituting “Commissioner” (Item 92, Pt 3A, Sch 1).
Also of relevance to the AWU’s contention, to which I will shortly return, Sch 2 of the RO Amendment Act repealed s 305(2) which had contained the list of civil penalty provisions and inserted the current form of s 305(2) set out above. Each of the provisions that had been listed in the former s 305(2) was amended by Sch 2 of the RO Amendment Act to add the words “Civil penalty” as well as a specification of the maximum penalty units applicable to a contravention of that provision.
Further, it is relevant to note that the RO Amendment Act conferred on the Commissioner a range of powers in relation to the conduct of an investigation that were not previously available to the General Manager. Those powers, include:
(i)the power to require a person to take an oath or make an affirmation (s 335D(1));
(ii)the power to require a person to answer a question on pain of a criminal penalty (s 335D(3) and s 337(1)(d)(i)); and
(iii)the power to apply for a warrant which, on issue, would authorise a member of the AFP to obtain documents by executing the warrant upon specified premises with authority to use such force as is necessary and reasonable to enter on or into those premises, search the premises, break open and search anything and take possession of documents (ss 335K and 335L).
Division 6 of Pt 4 of Ch 11 of the RO Act imposes criminal sanctions upon a person who fails to comply with, or obstructs, the exercise of these powers.
Lastly, Pt 2 of Sch 1 of the RO Amendment Act sets out transitional provisions. Those transitional provisions include some provisions which identify the intended interaction between the functions and powers of the General Manager and those of the Commissioner. In particular, Item 130 of Sch 1 (“Item 130”) deals with “a process” begun under the RO Act by the General Manager or the Fair Work Commission (“FWC”). It is not in contention that an investigation of the kind contemplated by s 331(2) of the RO Act is a “process” within the meaning of Item 130. Item 130 is in the following terms:
130 Commissioner to complete certain processes
(1) This item applies if:
(a)a process begun under the Act is incomplete at the commencement time; and
(b)because of the amendments made by this Schedule, a function or power that the General Manager or the FWC was required, or able, to perform or exercise in relation to the process has become a function or power of the Commissioner.
(2) For the purposes of completing the process:
(a)the Commissioner must or may, as the case requires, perform the function or exercise the power; and
(b)things done by or in relation to the General Manager or the FWC before the commencement time have effect as if they were done by or in relation to the Commissioner.
The AWU contended that its proposition that the investigative function conferred upon the Commissioner by s 331(2) does not extend to Historical Conduct, is supported by the following considerations. First, that on 1 May 2017, the Commissioner was established “as a new entity with a new suite of coercive powers”. Second, that specific and limited provision was made for the Commissioner to perform a function or exercise a power that the General Manager or the FWC was required, or able, to perform or exercise before 1 May 2017. In particular, the AWU relied upon Item 130 providing for the Commissioner to assume only the functions and powers of the General Manager in relation to a process already commenced under the RO Act as at 1 May 2017. Third, that there is no provision in either the RO Act or the RO Amendment Act which provides for the Commissioner to generally assume the functions and powers of the General Manager or the FWC under the RO Act as in force before 1 May 2017.
Accordingly, the AWU submitted that by making specific and limited provision for the Commissioner to perform a function or exercise a power that the General Manager or the FWC was required, or able, to perform or exercise before 1 May 2017, and not providing for the Commissioner generally to assume the functions and powers of the General Manager or the FWC under the RO Act as in force before 1 May 2017, Parliament must be taken to have intended to limit the power of the Commissioner in relation to conduct that occurred before 1 May 2017.
Four further considerations were relied upon by the AWU in support of the Parliamentary intent contended for. The fourth and fifth considerations were each based on the suite of new powers available in the conduct of an investigation to the Commissioner. The AWU contended that, to read into the RO Act a general power for the Commissioner to conduct an investigation as to whether a civil penalty provision was contravened before 1 May 2017, would undermine the express limitations on the Commissioner’s powers provided for in Item 130 which confined the Commissioner to exercise only the functions and powers of the General Manager. Additionally, the AWU contended that as the exercise of the new powers would involve a substantial intrusion into fundamental common law rights, in the absence of clear language to the contrary, the principle of legality requires that s 331(2) of the RO Act be read as only authorising an investigation as to whether a civil penalty provision has been contravened after 1 May 2017.
Sixth, the AWU contended that concern about retrospectivity was another factor tending against any expansive or generous interpretation of the Commissioner’s powers and, applying well settled principles of the common law, it ought to be presumed that s 331(2) is not intended to have retrospective effect.
Seventh, the AWU relied upon the amendments made by the RO Amendment Act to s 305(2) to contend that the Commissioner is only empowered to conduct an investigation as to whether there has been a contravention of a provision that has at its foot the words “Civil penalty” and, that it must follow from the amendments made, that the power is confined to an investigation of a contravention suspected to have occurred after 2 May 2017. The AWU submitted that this is apparent from the ordinary meaning of the statutory text employed.
The Commissioner’s response to the construction of s 331(2) contended for by the AWU included the submission that it would result in irrational or absurd outcomes. The Commissioner contended that on that construction, other than for investigations already commenced by the General Manager prior to 1 May 2017, there would be no capacity to investigate suspected contraventions.
The AWU had two answers to that submission. First, that the function of investigating a contravention by Historical Conduct under s 331(2) remained with the General Manager. For that proposition the AWU relied upon s 7(2)(e) of the Acts Interpretation Act 1901 (Cth). Section 7(2) relevantly provided:
(2)If an Act, or an instrument under an Act, repeals or amends an Act (the affected Act) or a part of an Act, then the repeal or amendment does not:
(a)revive anything not in force or existing at the time at which the repeal or amendment takes effect; or
(b)affect the previous operation of the affected Act or part (including any amendment made by the affected Act or part), or anything duly done or suffered under the affected Act or part; or
(c)affect any right, privilege, obligation or liability acquired, accrued or incurred under the affected Act or part; or
(d)affect any penalty, forfeiture or punishment incurred in respect of any offence committed against the affected Act or part; or
(e)affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty, forfeiture or punishment.
Any such investigation, legal proceeding or remedy may be instituted, continued or enforced, and any such penalty, forfeiture or punishment may be imposed, as if the affected Act or part had not been repealed or amended.
Note:The Act that makes the repeal or amendment, or provides for the instrument to make the repeal or amendment, may be different from, or the same as, the affected Act or the Act containing the part repealed or amended.
Second and in the alternative, the AWU contended that if there was a lacuna in the capacity for investigations to be conducted, that was to be rectified by an appropriate statutory amendment rather than by the Court impermissibly filling gaps by straining for a construction thought to be consistent with an assumed legislative purpose. The AWU submitted that the Commissioner’s interpretation departs from the statutory text and that it is unclear how the Commissioner’s interpretation can be reconciled with s 305(2) of the RO Act.
Deliberation
The AWU’s construction of s 331(2) of the RO Act requires that the general words of s 331(2) be read down to impose a temporal limitation not expressly made. For the reasons that follow, none of the considerations relied upon by the AWU justify the construction of s 331(2) contended for.
Turning to each of the considerations relied upon by the AWU, the AWU’s contention that as at 1 May 2017 the Commissioner was a “new entity” is of itself, a neutral factor. I will return to the AWU’s reliance upon the Commissioner having “a new suite of coercive powers”. However, the fact that an entity, different to the General Manager in whom the investigative function provided for by s 331 had been reposed was newly established and given that function, does not of itself support the existence of an intended temporal limitation on the exercise of that function.
The AWU’s second point was that, by Item 130, specific and limited provision was made for the Commissioner to assume the functions and powers of the General Manager. However, on its own, that consideration is also neutral. It is only supportive of the AWU’s construction if the AWU’s third point is correct: that there is no provision in either the RO Act or the RO Amendment Act which provides for the Commissioner generally to assume the functions and powers of the General Manager.
The fundamental difficulty for the AWU is that s 331(2) of the RO Act is such a provision. It is helpful that the terms of that provision be set out again:
(2)If the Commissioner is satisfied that there are reasonable grounds for doing so, the Commissioner may conduct an investigation as to whether a civil penalty provision (see section 305) has been contravened.
The provision provides for the Commissioner to conduct an investigation as to whether a civil penalty provision has been contravened. The capacity there given to conduct an investigation is qualified by the need for the Commissioner to be satisfied that there are reasonable grounds for doing so, but in terms it is not otherwise qualified and, in particular, there is no temporal qualification or limitation expressed.
Prior to the amendment made to s 331(2) by the RO Amendment Act on 1 May 2017, the function conferred by that provision operated upon past events – namely, whether a civil penalty provision “has been” contravened. The operative scope of that function could have been limited to suspected contraventions that post-dated the amendment, but it was not. That aspect of the operation of s 331(2) was left textually unchanged. Whilst the language utilised may be characterised as general and thus susceptible to being read down if that course was justified, in the absence of such a justification the words are capable of bearing a sufficiently clear meaning to the effect that the function conferred is temporally unconfined in respect of conduct that may have contravened a civil penalty provision.
Item 130 provides no justification for reading down the text of s 331(2). Item 130 only serves to demonstrate the existence of the need for the transitional provisions to address the special case there dealt with. In so far as Item 130 concerns the function conferred upon the Commissioner by s 331(2), it is there to effectuate the performance of that function in particular or special circumstances. In the ordinary case, an investigation under s 331(2) will be conducted by a single entity. Given the change of entities effected by the amendments made to s 331(2) by the RO Amendment Act, a possibility arose that a single investigation may be conducted in part by the outgoing entity (the General Manager) and in part by the incoming entity (the Commissioner). Item 130 addresses such a special case, not only in relation to s 331(2), but in relation to any process begun by the General Manager or by the FWC which was incomplete as at 1 May 2017. That was obviously done to ensure that any process commenced by the General Manager or the FWC was able to be validly completed by the Commissioner.
The fourth point made by the AWU also relied upon the terms of Item 130. That contention is premised upon a construction of Item 130 that, in exercising powers when completing an investigation commenced by the General Manager, the Commissioner is confined to only exercising the powers formerly held by the General Manager and not any additional powers conferred upon the Commissioner by the RO Amendment Act. For that reason, the AWU contended that the express limitations on the Commissioner’s powers provided for in Item 130 would be undermined if it were intended that the Commissioner, using his new suite of powers, could conduct an investigation as to whether a civil penalty provision was contravened before 1 May 2017.
There are a number of difficulties with that proposition. First, it is not at all clear that Item 130 confines the Commissioner to the exercise of only those powers formerly held by the General Manager. Item 130(2)(a) provides that in completing the process begun by the General Manager, the Commissioner may exercise a power held by the General Manager. That provision is explicable including because a power exercised by the General Manager may have only been partly exercised as at 1 May 2017. It seems to me that it is that circumstance that Item 130(2)(a) is principally seeking to address, and in doing so, the provision operates to confirm that the Commissioner is reposed with the former powers of the General Manager. It is not necessarily the case that in providing for the Commissioner to complete a process commenced by the General Manager, the provision intends to exclude the exercise of a power held by the Commissioner but not formerly held by the General Manager. On its face, Item 130(2)(a) contains no words of limitation. It is not clear that an implied limitation was intended, although that may well be the better view.
However, even if I were to presume that the AWU’s construction is correct, the fact that the Commissioner’s powers are restricted to those that were available to the General Manager, in circumstances where an investigation had already been commenced by the General Manager, does not serve to undermine the proposition that the Commissioner has available to him his full suite of powers in dealing with an investigation commenced by him in relation to Historical Conduct. There is a basis for saying that, in relation to a process already underway, the goal posts ought not to be shifted. The existence of an intention consistent with that objective does not, however, support the idea that in relation to a process not yet commenced a limitation was intended upon the exercise of the powers conferred on the Commissioner.
In my view, Item 130 has nothing to say about how s 331(2) was intended to operate in the ordinary case where an investigation is commenced by the Commissioner in the expectation that it will be completed by the Commissioner.
The essence of the AWU’s fifth point about the principle of legality and the AWU’s sixth point about a concern for retrospectivity, is that clear words are required in order for s 331(2) to be read as authorising the Commissioner to conduct an investigation as to whether a civil penalty provision has been contravened by Historical Conduct. I would accept that if the principle of legality or the presumption against retrospectivity were attracted, the words of s 331(2) may need to be read down in the manner contended for by the AWU.
It may be accepted in favour of the AWU that the Commissioner has powers, the exercise of which may involve a substantial intrusion into fundamental common law rights sufficient to engage the principle of legality. One such power referred to by the AWU is a power potentially intrusive of the privilege against self-incrimination, to require a person to answer a question on pain of criminal penalty (ss 335D(3); 337(1)(d)(i); 337AD). It may also be accepted that, by reason of the principle of legality, a statutory provision will not be read as authorising an intrusion into fundamental common law rights or freedoms unless it does so in clear language: North Australian Aboriginal Justice Agency Ltd v Northern Territory (2015) 256 CLR 569 at [11] (French CJ, Kiefel and Bell JJ).
However, the AWU did not contend that any particular provision conferring on the Commissioner a power, the exercise of which may intrude upon fundamental common law rights, suffered from an absence of clear language. For instance, the AWU was not contending that s 335D(3) did not, by clear words, empower the Commissioner to compel a person to answer a question despite the possible intrusion into the privilege against self-incrimination. To construe the RO Act as permitting the Commissioner to compel an answer in the context of a s 331(2) investigation into conduct occurring after 1 May 2017 was not said by the AWU to offend the principle of legality. However as I understood it, the AWU was contending that to construe the RO Act as permitting the Commissioner to compel such an answer in the context of a s 331(2) investigation into Historical Conduct would offend the principle.
That reveals that the vice that the AWU really had in mind was not an intrusion into common law rights per se but an intrusion involving retrospectivity. The AWU’s reliance upon the principle of legality is, in substance, no different to its reliance upon the common law presumption against retrospectivity. Indeed as French CJ, Crennan and Kiefel JJ observed in Australian Education Union v Fair Work Australia (2012) 246 CLR 117, the underlying rationale or assumption upon which the presumption against retrospectivity is based may be viewed as an aspect of the principle of legality. Relevantly, and at [30] their Honours said:
The preceding observations should not be taken as minimising the importance of the rationale underlying the common law principles of construction. In a representative democracy governed by the rule of law, it can be assumed that clear language will be used by the Parliament in enacting a statute which falsifies, retroactively, existing legal rules upon which people have ordered their affairs, exercised their rights and incurred liabilities and obligations. That assumption can be viewed as an aspect of the principle of legality, which also applies the constructional assumption that Parliament will use clear language if it intends to overthrow fundamental principles, infringe rights, or depart from the general system of law. The existence of those assumptions is, in the words of Gleeson CJ in Electrolux Home Products Pty Ltd v Australian Workers’ Union,
‘a working hypothesis, the existence of which is known both to Parliament and the courts, upon which statutory language will be interpreted. The hypothesis is an aspect of the rule of law.’
I proceed on the basis that both the fifth and sixth points raised by the AWU turn on whether a presumption against retrospectivity is attracted to support the contention that, absent clear words, the RO Act does not authorise the Commissioner to conduct an investigation into whether a civil penalty provision was contravened before 1 May 2017 (except for the extent provided for in Item 130), or to exercise powers that were not available to the General Manager in the course of such an investigation.
In my view, a presumption against retrospectivity is not attracted.
There have been many formulations of the common law principle here being addressed. Some of the formulations were relied upon by French CJ, Crennan and Kiefel JJ (at [26]) in Australian Education Union:
The common law principles of interpretation require careful consideration of the adjective “retrospective” in its application to statutes. Interference with existing rights does not make a statute retrospective. Many if not most statutes affect existing rights. As Fullagar J said in Maxwell v Murphy:
‘I think that the word ‘retrospective’ has acquired an extended meaning in this connection. It is not synonymous with ‘ex post facto’, but is used to describe the operation of any statute which affects the legal character, or the legal consequences, of events which happened before it became law.’
In Chang Jeeng v Nuffield (Australia) Pty Ltd Dixon CJ referred to ‘the rules of interpretation affecting what is so misleadingly called the retrospective operation of statutes’. Repeating a passage from his judgment in Maxwell v Murphy, the Chief Justice said:
‘The general rule of the common law is that a statute changing the law ought not, unless the intention appears with reasonable certainty, to be understood as applying to facts or events that have already occurred in such a way as to confer or impose or otherwise affect rights or liabilities which the law had defined by reference to the past events.’
Furthermore, as Winneke CJ, Gowans and Starke JJ said in Robertson v City of Nunawading [1973] VR 819 at 824, the presumption against retrospectivity:
is not concerned with the case where the enactment under consideration merely takes account of antecedent facts and circumstances as a basis for what it prescribes for the future, and it does no more than that…The principle is concerned with the case where the enactment would apply to these antecedent facts and circumstances in such a way ‘as to impair an existing right or obligation’ or ‘as to confer or impose or otherwise affect rights or liabilities which the law had defined by reference to the past events’.
The AWU did not identify as part of its submission on retrospectivity, existing rights, liabilities or obligations said to be affected by the amendments made by the RO Amendment Act to the functions and powers of the Commissioner in relation to the conduct of an investigation under s 331(2). The submission was undeveloped. In any event, no effect of the requisite kind is apparent.
A person whose conduct is the subject of a s 331(2) investigation has no right not to be subjected to such an investigation, let alone a right existing prior to 1 May 2017 to be subjected only to an investigation in which the powers available to the General Manager prior to that time may be utilised. Further, it may be accepted that the exercise of the Commissioner’s powers in relation to an investigation can affect the rights of persons, whether the subject of the investigation or not. For example, the right to silence or rights to property. However, the rights affected are not rights which are changed with effect prior to the commencement of the RO Amendment Act. The effect upon those rights cannot therefore be said to operate retrospectively.
As the Commissioner contended, the relevant facts here are not materially different to that considered by Marks J (with whom Murphy and McGarvie JJ agreed) in Commissioner for Corporate Affairs v X and Y [1987] VR 460.
The respondents in that case were acting as receivers and managers of a particular company between 1978 and 1980. On 1 July 1982, a new power was conferred upon the Commissioner for Corporate Affairs by s 541 of the Companies (Victoria) Code (“Code”). That provision empowered the Commissioner for Corporate Affairs to apply to a court for an order compelling persons who had taken part or had been concerned in the affairs of a corporation and who had been or may have been guilty of fraud, negligence, default, breach of trust, breach of duty or other misconduct in relation to that corporation, to be compulsorily examined in relation to the affairs of the corporation concerned. Non-compliance with that requirement gave rise to a criminal sanction. On 12 July 1985, the Commissioner for Corporate Affairs applied to the Supreme Court of Victoria for an order compelling the respondent receivers and managers to be examined in relation to their conduct in 1978-1980.
On those facts, the Full Court of the Supreme Court of Victoria rejected the proposition that the presumption against retrospectivity was attracted, holding that s 541 of the Code operated prospectively, stating at 464 “legislation is not properly called retrospective merely because events are by virtue of it the subject of prospective action such as examination under court order”.
The seventh consideration relied upon by the AWU turned on the amendments made by the RO Amendment Act to s 305(2). Relying on the terms of s 331(2) and in particular that “the Commissioner may conduct an investigation as to whether a civil penalty provision (see section 305) has been contravened”, the AWU contended that reading the definition of “civil penalty provision” provided by s 305(2) into s 331(2), has the consequence that the Commissioner only has the power to conduct an investigation as to whether there has been a contravention of a provision that has, set out at its foot, a pecuniary penalty indicated by the words “Civil penalty”. The AWU contended, by reference to the legislative history of s 305(2) to which I have referred, that it was only after 2 May 2017 that civil penalty provisions in the RO Act had, set out at their foot, a pecuniary penalty indicated by the words “Civil penalty”. It follows, so the AWU contended, that the Commissioner only has the power to conduct an investigation as to whether a provision of the RO Act was contravened after 2 May 2017. Any contravention that occurred before 2 May 2017 would necessarily involve a provision that did not have, set out at its foot, a pecuniary penalty indicated by the words “Civil penalty” and, so the AWU contended, the Commissioner has no power to investigate such a contravention under s 331(2) of the RO as in force at the time the Investigation commenced.
The RO Amendment Act introduced new provisions into the RO Act and designated some as civil penalty provisions. That, however, is not material. What is material, is that prior to the commencement of the RO Amendment Act some 43 provisions of the RO Act were designated to be civil penalty provisions and, by reason of s 331(2), a suspected breach of those provisions could have been the subject of a s 331(2) investigation. After the commencement of the RO Amendment Act those provisions continued as civil penalty provisions of the RO Act. The only relevant alteration made by the RO Amendment Act was to the means by which those provisions were identified as civil penalty provisions. Prior to the amendments being made, the provisions were listed in s 305(2) and designated as “civil penalty provisions”. After the amendments were made, those provisions self-identified as civil penalty provisions by containing the words “Civil penalty” in the manner provided for by the current terms of s 305(2).
The change made cannot be understood as anything more than the result of the adoption of a different drafting technique. The change was stylistic. There is nothing to support the idea that a change of any substance was intended by the amendment made to s 305(2) of the RO Act by the RO Amendment Act.
The AWU’s contention must be that despite the RO Amendment Act continuing the status of those provisions as civil penalty provisions, the RO Amendment Act stripped those provisions of that status in relation to their operation prior to the commencement date of that Act. In other words, the AWU’s contention is that the operation of those provisions was retrospectively altered so that they no longer operated as civil penalty provisions in the period prior to 2 May 2017.
The AWU offers no policy rationale to support any discernible Parliamentary intention to effectuate that retrospective alteration, the unameliorated consequence of which would be that persons who had contravened those provisions but who had not been dealt with by 2 May 2017, would effectively be immune, not only from a s 331(2) investigation, but also from proceedings for contraventions of civil penalty provisions in this Court.
The AWU’s contention must be rejected, including its reliance, in the alternative, on the inexplicable consequences of its construction being unintended but nevertheless unrectifiable in the absence of legislative amendment.
A complete answer to the AWU’s unattractive construction is provided by s 7(2)(b) of the Acts Interpretation Act. That provision relevantly provides that an amendment to an Act does not “affect the previous operation of the affected Act or part”.
As Gleeson CJ said in Attorney-General(Q) v Australian Industrial Relations Commission (2002) 213 CLR 485 at [8]:
Acts of Parliament are drafted, and are intended to be read and understood, in the light of the Acts Interpretation Act. A particular Act, and the Acts Interpretation Act, do not compete for attention, or rank in any order of priority. They work together. The meaning of the particular Act is to be understood in the light of the interpretation legislation.
Prior to the amendments made by the RO Amendment Act, the relevant provisions operated as civil penalty provisions. By reason of s 7(2)(b) of the Acts Interpretation Act the operation of those provisions as civil penalty provisions was unaffected by the amendments made by the RO Amendment Act, and in particular, the amendments made to s 305(2). It ought to be presumed that those amendments were drafted on the basis that they would be read in light of the Acts Interpretation Act. A similar argument was made by the Commissioner by reference to s 7(2)(c) of the Acts Interpretation Act. I need not determine whether that provision would provide for the same result. I am satisfied that s 7(2)(b) is sufficient of itself. There can be no doubt that the application of that provision is not subject to any contrary intention (see s 2(2) of the Acts Interpretation Act).
Accordingly, the provisions in question bore the description used in s 331(2) of the RO Act “a civil penalty provision” and continued to bear that description in relation to their operation after 2 May 2017 without being affected by the amendments made to s 305(2) by the RO Amendment Act. The AWU’s seventh point must therefore be rejected.
Lastly, in so far as the AWU relied on the operation of s 7(2)(e) of the Acts Interpretation Act to contend that the General Manager still holds the function of conducting a s 331(2) investigation into Historical Conduct, I would conclude that that provision has no application because a contrary intention is demonstrated by the terms of s 331(2) as amended by the RO Amendment Act. That provision, as I have construed it, is clearly inconsistent with the survival of the General Manager’s investigative function: Attorney-General (Q) at [52] (Gaudron, McHugh, Gummow and Hayne JJ).
A number of contentions were raised by the Commissioner which, in the circumstances, it is unnecessary for me to address. Each of the parties referred to explanatory memoranda and the AWU also referred to amendments made to the commencement date of Sch 1 and 2 of the Fair Work (Registered Organisations) Amendment Bill 2014. Whilst I have considered that material, I have found it of little or no assistance in the interpretive task here addressed.
For all those reasons, I conclude that s 331(2) empowers the Commissioner, where satisfied that there are reasonable grounds to do so, to conduct an investigation as to whether a civil penalty provision has been contravened. There is no justification for reading into the text of that provision the temporal restriction contended for by the AWU. The Commissioner’s decision to conduct the Investigation under s 331(2) into conduct occurring before 1 May 2017 did not involve any misconstruction of the statutory task conferred upon him by that provision and was not affected by jurisdictional error as contended for by the AWU. Ground 1 of the AWU’s grounds of review must be rejected.
ground 2 – Was the Commissioner validly satisfied that there were reasonable grounds for conducting the Investigation?
Under this ground the AWU challenged the Investigation contending that the condition on the Commissioner’s exercise of power to conduct an investigation under s 331(2), that “the Commissioner is satisfied that there are reasonable grounds for doing so”, was not validly met. There are two limbs to ground 2 but they are best addressed together. Before doing so it is necessary to set out the relevant legislative provisions.
Relevant Legislative Provisions
Section 140(1) of the RO Act provides that a registered organisation “must have rules that make provision as required by this Act”. That is the current requirement but was also the requirement under s 140(1) of Sch 1 of the WR Act which was applicable at the time that each of the Donations were made.
Section 149(1) of the RO Act specifies that the rules of a registered organisation must provide conditions in relation to loans, grants and donations made by the organisation. Relevantly, s 149(1) provides:
Rules to provide conditions for loans, grants and donations by organisations
(1)The rules of an organisation must provide that a loan, grant or donation of an amount exceeding $1,000 must not be made by the organisation unless the committee of management:
(a) has satisfied itself:
(i)that the making of the loan, grant or donation would be in accordance with the other rules of the organisation; and
(ii)in the case of a loan – that, in the circumstances, the security proposed to be given for the repayment of the loan is adequate and the proposed arrangements for the repayment of the loan are satisfactory; and
(b) has approved the making of the loan, grant or donation.
At the time of the making of the Donations, a legislative predecessor to s 149(1) (s 149(1) of Sch 1 of the WR Act) specified the same requirements.
It is not in contest that at the time the Donations were made, the rules of the AWU (“Rules”) relevantly included r 57 which was in the following terms:
(1)A loan, grant or donation, must not be made by the Union or any Branch as the case may be, unless the National Executive of the Union has:
(a) Satisfied itself:
(i)that the making of the loan, grant or donation, would be in accordance with the Rules of the Union; and
(ii)in relation to a loan, that, in the circumstances, the security proposed to be given for the repayment of the loan is adequate and the proposed arrangements for the repayment of the loan are satisfactory; and
(b) Approved the making of the loan, grant or donation.
(2)Nothing in sub-clause (1) is to affect a Branch’s power to make donations, less than $1,000. However, National Executive may from time to time set a maximum donation figure lower than $1,000.
The Decision Record refers to r 57 and, as I will detail shortly, relies upon the possibility that the Donations were not made in accordance with r 57 as a basis for Mr Enright’s satisfaction that “there are reasonable grounds to conduct an investigation”.
Section 320(1) of the RO Act is a deeming provision which applies to certain acts done, by a collective body or office-holder of a registered organisation (or by person/s purporting to act as such), after the end of four years from the doing of those acts. Relevantly s 320(1) provides:
Validation of certain acts after 4 years
(1) Subject to this section and section 321, after the end of 4 years from:
(a) the doing of an act:
(i)by, or by persons purporting to act as, a collective body of an organisation or branch of an organisation and purporting to exercise power conferred by or under the rules of the organisation or branch; or
(ii)by a person holding or purporting to hold an office or position in an organisation or branch and purporting to exercise power conferred by or under the rules of the organisation or branch; or
the act, election or purported election, appointment or purported appointment, or the making or purported making or alteration or purported alteration of the rule, is taken to have been done in compliance with the rules of the organisation or branch.
At the time that the Donations were made, the legislative predecessor of s 320(1) the RO Act (s 89 of Sch 1 of the WR Act) was in similar terms.
The AWU’s Contentions
Under the first limb of ground 2, the AWU contended that the Decision was affected by jurisdictional error because it was not open for Mr Enright to be satisfied that there were reasonable grounds to conduct the Investigation. The second and related basis for ground 2 was that, in not adverting to s 320 of the RO Act or, alternatively by proceeding on an erroneous view of that provision, Mr Enright misunderstood the law he was to apply.
The AWU contended that the ground (and only ground) relied upon by Mr Enright in being satisfied that there were reasonable grounds to conduct the Investigation as to whether ss 285(1), 286(1) and 287(1) had been contravened, was that the making of the Donations involved suspected non-compliance with the Rules and in particular r 57. The AWU contended that the basis for Mr Enright’s satisfaction was misconceived. Relying on the operation of s 320 of the RO Act, the AWU submitted that the making of the Donations was “taken to have been done in compliance with the Rules” at the end of the 4 year period after each of the Donations were made and that therefore, at the time of the Decision, there was no possibility of non‑compliance with the Rules in relation to the making of the Donations. Accordingly, so the AWU contended, it was not open for Mr Enright to have reached the state of satisfaction required by s 331(2) and the Decision was therefore affected by jurisdictional error and invalid.
The submission is inapplicable to the Decision so far as it concerned the conduct of an investigation into whether s 237(1) was contravened because that aspect of the Investigation had nothing to do with suspected contraventions of the Rules. Nevertheless, the AWU contended that the Decision, as a whole, was invalid. It may be that the AWU intended to say, as its submission did say in a similar context, that the Decision to conduct the Investigation is an integrated whole which cannot be severed without “radically recast[ing] its nature and effect” (Plaintiff S4/2014 v Minister for Immigration and Border Protection (2014) 253 CLR 219 at [55]).
Deliberation – The Relevant Principles
It was not in contest that the state of satisfaction required by s 331(2) is a condition upon the exercise of the function or power there conferred. Nor was it in contest that whether the state of satisfaction required by s 331(2) exists, is a question amenable to judicial review. The applicable principle for assessing whether the formation of a statutory state of satisfaction is affected by jurisdictional error was recently stated by Kiefel CJ, Gageler and Keane JJ in Hossain v Minister for Immigration and Border Protection [2018] HCA 34. At [34] their Honours said that the “[f]ormation of the [decision-maker’s] state of satisfaction or of non‑satisfaction is in each case conditioned by a requirement that the [decision-maker] … must proceed reasonably and on a correct understanding and application of the applicable law”. For that proposition their Honours referred to a number of authorities including the survey of authorities provided by Gummow J in Minister for Immigration and Multicultural Affairs v Eshetu (1999) 197 CLR 611, in which (at [133]) his Honour relied upon the following seminal observations of Latham CJ in R v Connell; Ex parte Hetton Bellbird Collieries Ltd (1944) 69 CLR 407 (at 430 and 432):
[W]here the existence of a particular opinion is made a condition of the exercise of power, legislation conferring the power is treated as referring to an opinion which is such that it can be formed by a reasonable man who correctly understands the meaning of the law under which he acts. If it is shown that the opinion actually formed is not an opinion of this character, then the necessary opinion does not exist.
…
It should be emphasized that the application of the principle now under discussion does not mean that the court substitutes its opinion for the opinion of the person or authority in question. What the court does do is to inquire whether the opinion required by the relevant legislative provision has really been formed. If the opinion which was in fact formed was reached by taking into account irrelevant considerations or by otherwise misconstruing the terms of the relevant legislation, then it must be held that the opinion required has not been formed. In that event the basis for the exercise of power is absent, just as if it were shown that the opinion was arbitrary, capricious, irrational, or not bona fide.
In Graham v Minister for Immigration and Border Protection (2017) 263 CLR 1 at [57], Kiefel CJ, Bell, Gageler, Keane, Nettle and Gordon JJ, in support of their observation that the satisfaction required of the decision-maker by the legislative provision there under consideration had to be “formed … reasonably and on a correct understanding of the law”, said (quoting from R v Anderson; Ex parte Ipec-Air Pty Ltd (1965) 113 CLR 177 at 189) that such a statutory condition had to be exercised by the decision-maker “according to the rules of reason and justice, not according to private opinion; according to law, and not humour, and within those limits within which an honest man, competent to discharge the duties of his office, ought to confine himself”.
Reasonableness as a condition of an opinion or state of satisfaction bears a relationship to reasonableness as a condition upon the exercise of a discretionary power, as formulated in Minister for Immigration and Citizenship v Li(2013) 249 CLR 332. That relationship was explained by Gageler J in Li at [90]:
Implication of reasonableness as a condition of the exercise of a discretionary power conferred by statute is no different from implication of reasonableness as a condition of an opinion or state of satisfaction required by statute as a prerequisite to an exercise of a statutory power or performance of a statutory duty. Each is a manifestation of the general and deeply rooted common law principle of construction that such decision‑making authority as is conferred by statute must be exercised according to law and to reason within limits set by the subject-matter, scope and purposes of the statute.
However, as Gageler J observed in Minister for Immigration and Border Protection v SZVFW [2018] HCA 30 at [53], reasonable grounds as a condition of an opinion or state of satisfaction imposes a condition on the exercise of power on the repository of a “higher standard” than that imposed by the requirement that a statutory power be exercised within the bounds of reasonableness as an implied condition of the statutory conferral of the power.
His Honour relevantly referred to Prior v Mole (2017) 261 CLR 265 where the applicable principles on reasonableness as a condition of an opinion or state of satisfaction were helpfully summarised by Gordon J at [98]-[100] in the context of the formation of a predictive opinion:
[98]When a statute prescribes that there must be “reasonable grounds” for a state of mind, it requires the existence of facts sufficient to induce that state of mind in a reasonable person. It is an objective test. The question is not whether the relevant person thinks they have reasonable grounds.
[99]In explaining the connection between the “reasonable grounds” and the requisite “belief”, this Court in George v Rockett stated:
‘The objective circumstances sufficient to show a reason to believe something need to point more clearly to the subject matter of the belief, but that is not to say that the objective circumstances must establish on the balance of probabilities that the subject matter in fact occurred or exists: the assent of belief is given on more slender evidence than proof.’
[100]Belief is not certainty. ‘Belief is an inclination of the mind towards assenting to, rather than rejecting, a proposition and the grounds which can reasonably induce that inclination of the mind may, depending on the circumstances, leave something to surmise or conjecture’.
Prior concerned s 128(1) of the Police Administration Act (NT). Under that section, a police officer was given the power to apprehend a person without a warrant where the police officer had reasonable grounds for believing, inter alia, that the person was intoxicated; was in a public place; and because of the person’s intoxication, the person may intimidate, alarm or cause substantial annoyance to people or is likely to commit an offence.
In that context, Gordon J continued at [101]:
Those considerations are important in this appeal. The matters set out in s 128(1)(c)(iii) and (iv) are the “subject matter” of the belief. That subject matter necessarily involves an element of opinion and judgment – a predictive opinion and judgment about what the person (here, Mr Prior) may or is likely to do in the future. That opinion and judgment is related to, but separate from, the objective facts and circumstances. Together, they constitute all of the relevant circumstances for assessing the reasonableness of the grounds. Accordingly, when considering whether there were reasonable grounds for the relevant belief for the purposes of s 128(1)(c)(iii) and (iv), matters of both fact and opinion must be considered.
Further, as Gageler J stated in Prior at [27] “[t]he Court must arrive at its own independent answer through its own independent assessment of the objective circumstances which the [decision-maker] took into account”; see further George v Rockett (1990) 170 CLR 104 at 114‑117 (Mason CJ, Brennan, Deane, Dawson, Toohey, Gaudron and McHugh JJ). The circumstances that were taken into account by the decision-maker may or may not be set out in the reasons for decision provided by the decision-maker. If reasons are given by the decision‑maker which explain the basis for the decision-maker reaching the requisite state of satisfaction or opinion, it is to those reasons that a supervising court should look to understand how the state of satisfaction or opinion was reached. That is the approach taken by a supervising court in the related field of legal unreasonableness. I can see no reason why the same approach is not apposite.
As was stated by Allsop CJ, Robertson and Mortimer JJ in Minister for Immigration and Border Protection v Singh (2014) 231 FCR 437 at [47]:
where there are reasons for the exercise of a power, it is those reasons to which a supervising court should look in order to understand why the power was exercised as it was. The “intelligible justification” must lie within the reasons the decision-maker gave for the exercise of the power — at least, when a discretionary power is involved. That is because it is the decision-maker in whom Parliament has reposed the choice, and it is the explanation given by the decision-maker for why the choice was made as it was which should inform review by a supervising court
See further Minister for Immigration and Border Protection v Haq [2019] FCAFC 7 at [35] (Griffiths J with whom Gleeson J agreed) and at [91]-[97] (Colvin J).
Deliberation – Application of the Principles to the Facts
Applying that approach and looking to the reasons given by Mr Enright for the Decision, for the reasons I will expand upon, I have come to the view that the only circumstance or ground relied upon by Mr Enright to form the opinion that there were reasonable grounds to conduct the Investigation as to whether ss 237(1), 285(1), 286(1) and 287(1) of the RO Act had been contravened was that there was a basis for suspecting that each of those provisions had been contravened and, further that Mr Enright’s only basis for the suspicion that ss 285(1), 286(1) and 287(1) had been contravened was that the Donations were not made in accordance with the Rules.
The absence of any suggestion of a motive is particularly problematic where conduct of the kind ascribed by the AWU to Mr Enright would ordinarily require a strong motivation. Mr Enright is a career public servant with a significant record of public service. So far as I am able to say from the evidence before me, he has had a successful and unblemished career. What he is alleged to have done is something that clearly would have been recognised by him as improper and, if discovered, highly prejudicial to his career as well as to his reputation. To my mind, a strong motivation would have been required to have induced a person in Mr Enright’s position to put his career and reputation at risk. As I have said, there is no suggestion in the evidence of such motivation.
Conclusion on Ground 3
I have assessed each of the reasons put forward by the AWU as supporting a finding that, in commencing the Investigation, Mr Enright’s purpose included aiding or assisting Minister Cash to discredit or politically harm Mr Shorten. Assessed individually none of those reasons are of any significant assistance to the finding contended for by the AWU. Assessed cumulatively, the position is unchanged. There is also some weight to be given to Mr Enright’s denial.
I accept the AWU’s submission that evidence of purpose needs to be treated with caution and should normally be critically scrutinised because it may often be ex post facto and self-serving: Universal Music Australia Pty Ltd v Australia Competition and Consumer Commission (2003) 131 FCR 529 at [256] (Wilcox, French and Gyles JJ). Caution and critical scrutiny is particularly appropriate in relation to Mr Enright’s denial that he held or acted in furtherance of the improper purpose, given that I have some concern with some of the evidence he gave. Nevertheless, when assessed against the entirety of the evidence, the denial is plausible and deserves to be given some weight.
For those reasons, the AWU’s third ground of review – that, in commencing the Investigation, Mr Enright acted for an improper political purpose must be rejected.
Ground 4 – Was an Irrelevant Consideration Taken into Account?
Under this ground of review, the AWU contended that in commencing the Investigation, Mr Enright took into account an irrelevant consideration being the Minister’s political purpose. The Commissioner accepted that if, in deciding to commence the Investigation, Mr Enright took into account Minister Cash’s purpose of discrediting, embarrassing or politically harming Mr Shorten, then the Decision would be affected by jurisdictional error so long as the taking account of the irrelevant consideration materially affected the decision reached. I accept that if Mr Enright did take into account the Minister’s alleged political purpose, that consideration was an irrelevant consideration in the Peko-Wallsend (Minister for Aboriginal Affairs v Peko‑Wallsend Ltd (1986) 162 CLR 24 at 40) sense and, if doing so materially affected the decision reached, jurisdictional error would be established: Hossain at [25]-[30] .
As the Commissioner contended, at the factual level, this claim rises no higher than the AWU’s third ground regarding improper purpose. All of the considerations put by the AWU in support of its contention that Mr Enright took into account an irrelevant consideration, were also relied upon in support of the AWU’s contention that Mr Enright acted in furtherance of the alleged improper political purpose. All of those considerations have already been addressed. Neither individually nor cumulatively do they demonstrate that Mr Enright took into account the consideration of assisting or aiding Minister Cash to discredit, embarrass or politically harm Mr Shorten.
I have reached that conclusion on the basis that it was necessary for the AWU to demonstrate that Mr Enright had regard to the alleged irrelevant consideration as a materially motivating factor in deciding to commence the Investigation. A decision-maker does not take account of an irrelevant consideration simply by examining but then discarding it without allowing it to affect his or her decision: Australian Conservation Foundation v Forestry Commission (1988) 19 FCR 127 at 135 (Burchett J).
Further, I have regarded this allegation as a grave allegation. It is based on Mr Enright having the same state of mind as was contended for in relation to the AWU’s case on improper purpose. The only suggestion open on the AWU’s case is that the irrelevant consideration was taken into account by Mr Enright deliberately, and knowing that to do so would be improper. In that circumstance I have taken the same approach to fact finding as I did in relation to the AWU’s case on improper purpose (see [268] above).
Ground 5 – Was the Investigation Commenced at the Direction of the Minister?
Under this ground, the AWU contended that Mr Enright’s decision to commence the Investigation was affected by jurisdictional error because Mr Enright “impermissibly acted upon the advice or direction of the Minister”.
The Commissioner did not dispute that in making the decision under s 331(2) of the RO Act, Mr Enright was not permitted to simply follow the direction or dictation of Minister Cash. The Commissioner conceded that the decision to commence the Investigation would be invalid if the actions and attitudes of others (namely, Minister Cash) had controlled the decision such that Mr Enright simply gave automatic effect to the direction of Minister Cash. The Commissioner contended that the AWU submissions significantly downplayed the applicable test for this ground of jurisdictional error.
The Applicable Legal Principles
The ground of jurisdictional error here advanced by the AWU is often referred to as the “dictation” ground, although as the learned authors state in Aronson M, Groves M, Weeks G, Judicial Review of Administrative Action and Government Liability (6th ed, Thomson Reuters, 2017) at [5.340] “that terminology might be too strong for some contexts”.
The extent to which a repository of a statutory power can be permissibly influenced or directed by the views of a government or a minister in the exercise of that power is, as stated by Mason and Wilson JJ in Bread Manufacturers of NSW v Evans (1981) 180 CLR 404 at 429, not a problem “which admits of an answer having universal application”. As their Honours went on to say when identifying the considerations most helpful in providing the case specific answer:
So much depends on a variety of considerations, for there are few cases in which the statute explicitly provides that the [repository of the power] is bound to give effect to, or to give weight to, a ministerial direction. One must take into account the particular statutory function, the nature of the question to be decided, the character of the tribunal and the general drift of the statutory provisions in so far as they bear on the relationship between the tribunal and the responsible Minister, as well as the nature of the views expressed on behalf of the Government.
Those observations were echoed in CPCF v Minister for Immigration and Border Protection (2015) 255 CLR 514 (see in particular French CJ at [37] and Kiefel J at [292]).
The AWU’s Contentions
The AWU submission referred to those observations but did not otherwise address them. The submission is difficult to follow. At the outset one set of propositions is advanced but then those propositions are not applied in terms, but are substituted for others, namely:
(i)Minister Cash had no power to give the Commissioner (or his/her delegate) a direction about the exercise of power under s 331(2) of the RO Act;
(ii)the referral letters from Minister Cash were directions and were taken into account and acted upon (at least in part) by Mr Enright; and
(iii)even if the referral letters were not directions, they were impermissibly taken into account and acted upon by Mr Enright.
Deliberation
The AWU’s first proposition is not in contest. The terms of s 329FA of the RO Act, which are detailed above at [175], make it sufficiently clear that the Minister may only give directions of a general nature. It would be impermissible for the Minister to direct the Commissioner to conduct an investigation pursuant to s 331 because that would not be a direction “of a general nature only” (s 329FA(2)). Similarly, it would be impermissible for the Minister to direct the Commissioner to consider whether to conduct a particular investigation pursuant to s 331. In that respect, although it is not defined, I would regard the term “direction” as used in s 329FA as contemplating an instruction about the performance of the Commissioner’s functions which the Commissioner is statutorily bound to follow.
Before turning to the AWU’s second and third propositions, it is necessary to consider the terms of the referral letters which have been set out at [193] and [207] above. Each of those letters refer to media reports in which allegations are made about the propriety of various donations that may have been made by the AWU. The content and tenor of the Minister’s remarks strongly suggest to the reader that the Minister is concerned that there may have been impropriety in relation to the expenditures referred to. In the first referral letter, that concern is confined to whether the expenditures were validly authorised by the Rules. The second referral letter raises the same concern as well as a concern of “a conflict of interest”. In so far as the first referral letter encourages any action on the part of the Commissioner, that encouragement is expressed as follows:
Accordingly, I request that you give consideration to investigating this matter in any way that you may consider appropriate.
A similar encouragement to action is contained in the second referral letter as follows:
Accordingly, I respectfully request that you give consideration to reviewing this matter as part of any investigation that you may undertake in relation to other AWU matters.
Given the familiarity that both the writer and the intended reader must be regarded as having with the RO Act, the reference to “investigating” or “any investigation” in the referral letters must be understood as an intended reference to an investigation under s 331 of the RO Act. However, the call to action made by each of the letters is not directed to the actual conduct of an investigation but refers only to the Commissioner giving consideration to conducting such an investigation. In each case, the call to action is not made using imperative language but is expressed as a “request”. That is not the language of a command or binding instruction. Objectively considered neither of the referral letters contain a direction within the meaning of that term in s 329FA.
The AWU’s submission characterised the referral letters as containing an “unlawful direction”. But rather than making good the objective characterisation contended for, the submission focused instead on Mr Enright’s perceptions and how it is alleged he subjectively characterised the referral letters. Although somewhat confusing, ultimately the submission did focus on the correct perspective.
To my mind, what matters for the “dictation” ground of jurisdictional error is the extent to which the repository of the power is influenced by others in the exercise of that power. So much is clear from Bread Manufacturers. That approach requires a subjective analysis taken from the perspective of the repository of the power. It is that person’s perception which matters, rather than any objective characterisation of the nature of the communication said to have influenced the person. That is not to say, however, that an objective characterisation of the relevant communication or other stimulus will not assist in assessing the extent to which that stimulus subjectively influenced the repository of the power.
The AWU contended that a finding should be made that Mr Enright understood the referral letters as connoting a direction to consider the letters. The AWU also contended that Mr Enright took into account the referral letters and took actions consequent upon them.
The AWU’s submission is not particularly clear as to what it is that Mr Enright is alleged to have taken into account. Was it the fact that the Minister held the probity concerns expressed in the letters of referral? Was it the making by the Minister of the requests that consideration to investigating the AWU be given? Was it both? Assuming the AWU intends to rely on all of the above, what was the action taken by Mr Enright in consequence thereof? Was it, as requested, that Mr Enright give consideration to commencing an investigation? Alternatively, was the action the actual making of the Decision?
If it is the latter, as it must be, there is little attention given by the submission as to the extent to which any aspect of the referral letters caused or contributed to the Decision.
The submissions seem to proceed on the basis that if Mr Enright “at least in part” acted upon “the referral”, Mr Enright’s decision to conduct the Investigation is affected with jurisdictional error. The degree of influence or effect of the referral letters that was necessary to undermine the Decision is not specified. The submission seems to proceed on the basis that any degree of influence is sufficient. That appears to be relied upon by the AWU as the test for what amounts to “dictation” for the purposes of a decision made under s 331(2) of the RO Act.
Turning to consider what is the appropriate test for s 331(2), I would characterise the considerations specified in Bread Manufacturers set out at [354] above as follows:
(i)the particular statutory function is a compliance function in relation to possible civil penalty contraventions;
(ii)the nature of the question to be decided is whether reasonable grounds exist warranting an investigation of possible civil penalty contraventions. Considerations to be largely determined on the basis of a forensic assessment of whether civil penalty contraventions have possibly occurred;
(iii)the character of the Commissioner in relation to an investigation is that of an independent statutory officer exercising judgment entirely independently of government; and
(iv)the general drift of the statutory provision which bear on the relationship between the Commissioner and the responsible Minister is that the Minister has oversight responsibility only in relation to the general performance of the functions of the Commissioner, without any role or responsibility in relation to any particular exercise of the Commissioner’s investigative function.
One further consideration referred to in Bread Manufacturers is “the nature of the views expressed on behalf of the Government”. This is a reference to the communication which is alleged to constitute the asserted “dictation”. The referral letters are described above. Their nature is not that of a direction. The concerns expressed and the requests made by the referral letters deal with a matter which is the sole responsibility of the Commissioner. When viewed in context, the letters are apt to be understood, as indeed they were understood by Mr Enright, as driven by a political agenda.
In assessing the extent of permissible influence from the Minister, I take into account that the conduct of an investigation under s 331 of the RO Act should be understood as a step which is preliminary of the possible institution of proceedings seeking a civil penalty and in relation to which an extensive range of coercive powers have been conferred upon the Commissioner. Whilst not forming part of the course of justice (cf R v Rogerson (1992) 174 CLR 268) an investigation under s 331 is to be understood as facilitative of the administration of justice and sufficiently proximate to the administration of justice to be regarded as intended to be free of any political influence or pressure from government.
That consideration, in particular, provides a point of distinction from the result in Bread Manufacturers. In the scheme there in question which concerned social welfare and economic considerations, the influence of government was to be tolerated to a far higher degree. It could be taken into account (at [429]), as long as the ultimate decision remained that of the repository of the power. As Mason and Wilson JJ said:
the Act requires the Commission to make up its own mind, to come to a decision of its own, in fixing the maximum price of bread, without dictation from the Minister and without merely deferring to the Minister so that the decision ceases to be that of the Commission and becomes that of the Minister.
(and see Gibbs CJ at 418)
In the scheme here in question, there is no tolerance for the Commissioner to be actuated by the view of the Minister on the largely forensic and entirely independent question of whether or not an investigation is warranted as a means of assisting the Commissioner to determine whether or not legal proceedings alleging contravention of a civil penalty provision of the RO Act should be instituted. Jurisdictional error will be demonstrated, where a communication from the Minister is a material and operative reason for the decision to conduct an investigation pursuant to s 331(2) of the RO Act.
That was not the test applied in the AWU’s submission. Nor was it the test suggested by the Commissioner, whose submission essentially adopted the test utilised in Bread Manufacturers as though it was a universal test, despite the observations there made that the appropriate test will always be case specific.
At the factual level, the AWU has failed to demonstrate that, the concerns of Minister Cash raised by the referral letters and as understood by Mr Enright and her requests that the subject of those concerns be considered for investigation, were a material and operative reason for Mr Enright’s decision to conduct the Investigation.
Mr Enright deposed as to his understanding of the necessary independence of the Commission and that he takes every step to guard it. He assumed that Minister Cash had a political agenda and his evidence displayed a strong understanding that such an agenda was of no relevance to his task of determining whether an investigation was warranted. Although for the reasons I have given in dealing with ground 2 Mr Enright was mistaken, he subjectively considered that there were reasonable grounds for conducting the Investigation. He had his reasons and they were expressed in the Decision Record. The AWU made no real attempt to demonstrate that Mr Enright’s account of his subjectively held reasons were not genuine. Those reasons provide a subjective explanation of Mr Enright’s decision to conduct the Investigation. Although not asked the question directly, Mr Enright’s evidence denies that, in addition to those reasons, he took into account the referral letters as a motivating reason for making the Decision.
Against those weighty considerations, the AWU pointed to much of the same evidence that it relied upon for its improper purpose ground. That evidence was largely directed at Mr Enright’s interactions with Minister Cash’s office including conduct said to be in anticipation of and taken in response to the referral letters. It was conduct which the AWU in essence contended was demonstrative of an enthusiasm to pursue the referral letters and obey what was perceived by Mr Enright to be their direction to investigate.
It is not necessary to address each aspect of the conduct relied upon by the AWU. Each has essentially already been addressed in relation to the improper purpose ground, where the AWU’s contention that the conduct was explicable for the impugned purpose relied upon by the AWU was not accepted. Whether considered alone or cumulatively, the evidence relied upon by the AWU does not demonstrate that the referral letters were treated by Mr Enright as a direction to undertake the Investigation. Nor, on any other basis, has the AWU demonstrated that the referral letters were a material and operative reason for Mr Enright’s decision to conduct the Investigation.
One matter heavily relied upon by the AWU, additional to those considerations relied upon for the improper purpose ground, was Mr Enright’s use of the term “referral” in relation to the referral letters, an argument I referred to earlier at [325]. The AWU contended that Mr Enright was unwilling to make the reasonable concession that he should have made: that a referral of a matter connotes a direction to consider it. The AWU contended that the Court should find that that is how Mr Enright understood the letters. Mr Enright denied that that was his understanding and there is an insufficient basis for rejecting that denial. In any event, even if it were accepted that Mr Enright had understood that, as “referrals”, the letters required their content to be considered, the fact that the letters were considered because Mr Enright perceived that so much was required, falls short of demonstrating that the letters provided a material and operative reason for Mr Enright’s decision to conduct the Investigation.
Ground 6 and 7 and the Relief Sought by the AWU
Grounds 6 and 7 challenge the validity of the search warrants which on 24 October 2017 were issued by his Honour Magistrate Reynolds of the Magistrates’ Court of Victoria.
The AWU’s essential point on ground 6 was that the existence of a valid investigation is an essential pre-requisite for the validity of the search warrants. The AWU contended that as there was no valid investigation on foot, the Commissioner was not authorised under s 335K of the RO Act to apply to a magistrate for the search warrants to be issued and that, accordingly, the search warrants are invalid.
Ground 7 also challenges the validity of the search warrants on the basis that the Commissioner was not authorised to apply for them to be issued. This ground was pressed in the alternative and on the basis that the Investigation was valid. It is premised on the proposition that in the conduct of an investigation as to whether a civil penalty provision was contravened by Historical Conduct, the Commissioner is only permitted to exercise powers that were or would have been available to the General Manager in the course of such an investigation, such powers not extending to a power to apply for search warrants to be issued. As that premise has already been rejected (see [46]-[49] and [51]-[62] above), I need not deal further with ground 7.
The submissions of the parties on ground 6 were relatively short and, it seems to me, insufficient consideration was given to matters of some consequence.
The relief sought by the AWU in relation to the search warrants is:
(i)a declaration that the search warrants are invalid;
(ii)an order in the nature of prohibition prohibiting the AFP from giving any further effect to the search warrants;
(iii)in the alternative to the declarations sought, an injunction prohibiting the AFP from giving any further effect to the search warrants; and
(iv)although para 7 of the prayer for relief in the Originating Application is ambiguous, as I would understand it, an injunction requiring the AFP to return to the AWU the documents seized in the execution of the search warrants without otherwise giving further effect to the search warrants.
Ordinarily, a challenge to the validity of a search warrant is brought by way of an application for judicial review of the decision made to issue the search warrant: see as examples Caratti v Commissioner of the Australian Federal Police (2017) 257 FCR 166 (Logan, Rangiah and Bromwich JJ); Wong v Commissioner, Australian Federal Police [2014] FCA 443 (Pagone J). Ordinarily, the person who has issued the search warrant is a party to such an application for judicial review.
It seems to me that the validity of the search warrants turns upon the validity of the decision to issue the search warrants under s 335L of the RO Act. That section relevantly provides:
(1)This section applies if, on an application under section 335K, the magistrate is satisfied that there are reasonable grounds to suspect that there are, or may be within the next 3 days, on particular premises, particular documents whose production could be required under section 335.
(2)The magistrate may issue a warrant authorising a member of the Australian Federal Police, whether or not named in the warrant, together with any person so named, with such assistance, and by such force, as is necessary and reasonable:
(a) to enter on or into the premises; and
(b) to search the premises; and
(c)to break open and search anything, whether a fixture or not, in or on the premises; and
(d)to take possession of, or secure against interference, documents that appear to be any or all of those documents.
The submissions of the parties did not address that provision at all. Nor have the parties addressed the question of whether, given the relief sought, Magistrate Reynolds should have been a party to the proceeding.
The submissions of the AWU and the Commissioner on the validity of the search warrants focused upon the validity of the application made for the search warrants to be issued. That matter is dealt with by s 335K as follows:
(1)If the Commissioner has reasonable grounds to suspect that there are, or may be within the next 3 days, on particular premises in Australia, documents whose production could be required under section 335, he or she may:
(a)lay before a magistrate an information on oath or affirmation setting out those grounds; and
(b)apply for the issue of a warrant to search the premises for those documents.
(2)On an application under this section, the magistrate may require further information to be given, either orally or by affidavit, in connection with the application.
However, without hearing from the parties, my current view is that a failure to comply with the requirements of s 335K would not, of itself, lead to the invalidity of the search warrants. Invalidity depends upon the validity of the decision to issue the warrants and, in that respect, whether the requirements of s 335L were satisfied. A valid application made in accordance with s 335K may well be a necessary pre-condition for the validity of the decision to issue the search warrants pursuant to s 335L. However, as stated, no submissions directed to s 335L were made.
Furthermore, why a declaration that the search warrants are invalid is necessary, is also a matter which the Court has not been addressed on.
I presume from the notation on the orders made by Kenny J on 27 October 2017, that pursuant to the search warrants, documents were produced to the AFP; that those documents are held by the AFP; and that the AFP has committed to refrain from giving the seized documents to the Commissioner until the final determination of this proceeding or further order. Further, from the related relief claimed by the AWU and set out at para [382] above, I assume that what the AWU primarily seeks is that the AFP return to the AWU the documents seized in the execution of the search warrants, without otherwise giving any further effect to the search warrants. However, the parties have not made any submissions, as to the Court’s power or as to the Court’s discretion, in relation to the orders sought by the AWU that no further effect be given to the search warrants and that the documents seized be returned to the AWU.
If that relief were granted, there may be no utility in a declaration being made that the search warrants were invalidly issued.
Turning to the other relief sought by the AWU, a declaration is sought that the Decision to commence the Investigation is invalid and orders are sought quashing that decision and prohibiting the Commissioner from giving it further effect. That relief, as well as the relief sought in relation to the search warrants, is premised on the whole of the Decision being invalid. However, at [172] I have set out my conclusion that only part of the Decision is directly affected by jurisdictional error, that being the decision to conduct an investigation as to whether ss 285(1), 286(1) and 287(1) had been contravened. I have not been addressed as to whether that conclusion renders invalid the whole of the Decision to conduct the Investigation. If it does not, I need to hear the parties as to what orders or other relief is appropriate if the Decision is only invalid as to part.
conclusion
I have rejected the AWU’s first, third, fourth, fifth and seventh grounds of review. I hold that the second ground of review is made out in part, that being, that the decision to conduct an investigation as to whether ss 285(1), 286(1) and 287(1) of the RO Act had been contravened was affected by jurisdictional error and is invalid.
The nature of the relief that should be ordered in consequence of the findings made by the Court requires further submissions from the parties and the Court’s further consideration. The orders I will make will facilitate that course.
I certify that the preceding three hundred and ninety-three (393) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Bromberg. Associate:
Dated: 11 October 2019
Appendix 1
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