Darch & Ors v The Collector of Customs (New South Wales)

[1991] HCATrans 103

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IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Sydney No S125 of 1990

B e t w e e n -

ALAN ROYSTON DARCH, JULIA JOY
DARCH, EPLAIMA PTY LTD and

CENTURION BICYCLES PTY LTD

Applicants

and

THE COLLECTOR OF CUSTOMS (NEW
SOUTH WALES), JOHN MATTHEW

SKEVINGTON, P. RICKETTS and

COMMONWEALTH OF AUSTRALIA

Respondents

Application for special leave

to appeal

BRENNAN J
DEANE J

TOOHEY J

Darch 1 19/4/91

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 19 APRIL 1991, AT 3.01 PM

Copyright in the High Court of Australia

MR P.E. KING: If the Court pleases, I appear for the

applicants. (instructed by Dexter Healey & Co)

MS M.J. BEAZLEY, OC: If the Court pleases, I appear for the

respondent with my learned friend,

MISS R.M. HENDERSON. (instructed by the Australian

Government Solicitor)

MR KING:  Your Honours, I respectfully submit that there are

four reasons why special leave should be granted in

this case. Firstly, there are good prospects of
success for the appeal which turns on the validity
of a decision by a public officer; secondly, that

the decision is contrary to a prior decision of

this Court; thirdly, that the decision fails to

take into account modern legal developments in

relation to procedural unfairness and, fourthly,
the decision involves a matter of wide-ranging
public importance or, to use the words of

Lord Salmon in the Secretary of State for Education

v Tameside, a matter of considerable constitutional

importance.

Your Honours, in support of my submissions, can I hand up to you a short chronology, an outline

of submissions and material in support, with a copy

for the Court officer? The chronology,

Your Honours, is attached to the outline of

submissions.

BRENNAN J:  I take it you have a copy of this for

Ms Beazley?

MR KING: Yes, Your Honour.

Your Honours, on the question of prospects, at

issue in this case are the necessary jurisdictional

facts for a valid executive decision requiring as a

condition of its validity a belief on reasonable

grounds. That is the test in the Customs Act,

section 203.

Your Honours, if the decision of

Mr Justice Meagher is correct - and it is basically

contained in one page in the transcript at
page 96 - and the other members of the Court of

Appeal agreed with him without comment, the

position is this in relation to a seizure of goods

by a Customs officer, that so long as the decision

maker, required as he is by statute to act on his

belief on reasonable grounds, makes a decision in

good faith on grounds that he thought were

reasonable, then the decision is valid and the

seizure consequential upon it is valid even though,

firstly, critical facts upon which the de6ision

maker acted are shown to be false and which could,

with a balanced approach, have been shown to be

Darch 2 19/4/91

false at the time the decision was made; second,

even though relevant considerations were not taken

into account; third, even though irrelevant

considerations were taken into account; fourth,
even though the decision was wrong - and there is

no disputing that in this case - and, fifth, even

though the decision was in fact not based on

reasonable grounds as the judge found and which

does not appear to be disputed in the judgment.

Your Honours, this result, we say, is

particularly harsh when it is considered that

seizure has devastating consequences.

BRENNAN J:  Did you say the judge found that there were no

reasonable grounds for - - -

MR KING:  Yes, Your Honour. The judge found that at

page 56.	He said at about line 15 to 23:
In my opinion the matters deposed to by

Mr Skevington in the passages from his
evidence which have earlier been set out, and

in which he details the information which he took into consideration in deciding that the

goods were forfeited and hence were liable to

seizure, fall far short of reasonable grounds

for arriving at such opinion.

That finding of His Honour is repeated by

Mr Justice Meagher without disagreement at page 96,

line 16. Now, can I come back to that to - - -

DEANE J:  When you say "without disagreement", the whole of

that passage involves disagreement.

MR KING:  No, with respect, Your Honour. The remainder of

the passage at page 96, which I will come to deal

with shortly, puts the matter in a different

context. His Honour is saying, "Well, the truth of

the matter is that he disregarded the relevant

contractual documents and he disregarded" - and His

Honour then makes a finding, and says at line 18:

disregarded, but considered, a letter -

Your Honours should note that at page 57 point 6

His Honour Mr Justice Yeldham held that he did not

consider the letter because that was conceded by Mr Skevington in evidence which set out the true

position.

So, here we have a situation where the Customs

officer is told, before he issues the notice of

seizure, what the true position is; referred to the

relevant documents; the proper point is put to him,

and yet those matters are not taken into account.

Darch 3 19/4/91

In addition, he disregards the primary contractual

and shipping documents which would have led him to

reach a right decision.

DEANE J:  I just cannot read, from line 20 on page 96, as

indicating other than a disagreement with the trial

judge's finding of absence of reasonable grounds.

MR KING:  I think, with respect, Your Honour, on analysis,

it does not - the point is not critical to the

matters that I am putting to the Court today, but

if one - - -

DEANE J:  But it may be critical to the question whether you

get leave to appeal, in that it may be critical to

the question whether you are simply trying to dress

up questions of fact into an issue of law.

MR KING:  We are certainly not doing that, Your Honour. Can

I take the same passage a little further, lines 20

onwards, as Your Honour just referred to?	And this
is the critical passage:

But, as long as he was acting in good faith, he was entitled to disregard documents which he reasonably thought were untrue -

the word "reasonably" there is highly equivocal in

this context, Your Honours -

and to act on information which he reasonably

thought was true -

and then there is a new clause commencing:

and in my view he was reasonably entitled to

seize the goods once he thought that, because

of the six factors enumerated above, which

together would reasonably justify his belief,

that the goods were in fact "forfeited goods".

What the learned judge is saying is not that in

fact there were reasonable grounds for his belief

but, rather, that he thought that there were

reasonable grounds for his belief, and that is the

critical difference.

DEANE J: Well, which are the six factors which - - -?

MR KING:	At the top of the page, Your Honour.
DEANE J:	I see.  Now, can I just take Your Honour to each

of those factors? Each of them are wrong and none

of them indicate the conclusion to which His Honour

referred. First, that the containers both arrived

in the same vessel. Now, Your Honours, the

evidence was that, in fact, under the contract with

Darch 19/4/91

the seller, they were to go on different vessels.

That was not taken into account. But, in any

event, so what if two containers come in on the

same vessel?

Second, His Honour referred to the fact that

Mrs McCormack's view - she was another Customs

officer who was not called, although she gave

evidence on an affidavit, and she gave evidence to

the effect that the contents of the containers

added up to unassembled bicycles. But at no stage,

as His Honour held, did Mr Skevington, the officer

who issued the notice, himself reach that view. In

other words, here we have a decision made by an

officer of Customs based not on his own decision

but on what somebody else thought about it. Third:

that Centurion, in his opinion, were the

"owners" of the containers -

well that is a question of law, and there was no

evidence in relation to that. And, in any event,

as both Mr Justice Yeldham and the Court of Appeal

held, that decision was just simply wrong - that

conclusion was simply wrong. Fourth:

that orders had been made on Centurion

letterhead -

but, Your Honours, as Mr Justice Yeldham held at

page 57, that consideration was not only irrelevant

but misleading because when one read the orders on
the Centurion letterhead, that is the content of

the letters, one observed that they were orders

from the individual companies. So, this is the

situation: that if a Customs officer looks at a

letterhead and sees it comes from company A, and

then ignores the contents of the document, that is

okay to seize the goods on the basis that he

thought they belonged to company A.	That is the
effect of what is being said.

BRENNAN J: That is not entirely accurate, is it? It is

just that if the question is whether these are

goods which are being imported for company A and

the order for them is to be found in a letter with

company A's letterhead, although signed on behalf

of company Band C, that is a factor which the

Customs officers are entitled to take into account

as indicative of whether or not company A, rather

than company Band C, is the true importer.

MR KING: That is so, Your Honour. But the reason that

these six factors are listed here is to indicate

the evidence of Mr Skevington which is found at

page 33 of the book, that he took into account.

But what it does not say is that he took into

Darch 19/4/91

account that it was on a letterhead of one company

but failed to read the documents and take into

account the relevant considerations that, in fact,

they were orders by another company or another

business owned by a Mr and Mrs Darch.

So, that is why I put to you, Your Honours,

that the six considerations themselves are
inaccurate and fail to take into account the full

facts. There does not seem to be any real dispute about that. What His Honour Mr Justice Meagher is

saying, that so long as he thought, because of the
six factors set out above, that they justify his

belief then he could seize the goods. That means

that any Customs officer who thinks that he has got

reasonable grounds for seizing goods can do so
without fear of being hauled into question, unless

some fraud is alleged and that is almost impossible

in these situations.

BRENNAN J:  I must be missing something, Mr King, because

the fact that he gives evidence that certain things

were present to his mind does not deprive those

certain things of the objective quality that is

essential in Lord Atkin's view in Liversidge v

Anderson.

MR KING: Quite so, Your Honour.

BRENNAN J: Well now, if you look down 1 to 6, leave aside

for the moment Mrs McCormack's view, are there not

solid items of fact there to be found?

MR KING:  No, Your Honour.

BRENNAN J: Well, was it a fact that both containers arrived

on the same vessel?

MR KING: That is so, but it was also a fact - - -

BRENNAN J: There may have been other facts. There may have

been facts which confess and avoid the inference to

be drawn from the primary fact.

MR KING:  One would hope then that the reasonable mind would

take those into account.

BRENNAN J:  My question is whether there is sufficient in

the facts that are listed there to lead a

reasonable mind, despite other matters which were

known, to come to the conclusion that he did?

MR KING: With respect, no, Your Honour, because if that

were the position that would mean that anybody in

a position of very substantial power, as a Customs

officer is in these situations, could say, "I have

facts A, B, C, D, E and F. A, Band C support my

Darch 6 19/4/91

view these are forfeited goods. Whether or not

they are does not matter. I seize the goods."

Now, if that were correct, if Your Honour's

proposition was correct, then that would be the

result. I respectfully submit that that is quite

contrary to the trend of cases since the war, since

Liversidge v Anderson, and Little v The

Commonwealth, where the courts have not conferred a

ministerial immunity upon decisions of that

type - - -

BRENNAN J:	Nobody doubts that proposition .... Mr King.
MR KING:	- - - where the statute uses the words, "The

Minister must be satisfied or must act on

reasonable grounds". That is the way that point,

with respect, Your Honour, can be viewed.

TOOHEY J:  But that is built into the section itself, is it

not? Do you need any support from decided cases

to arrive at that view of the subsection?

MR KING:  The view that I have just put, Your Honour?

TOOHEY J: Yes.

MR KING: Well, one does because His Honour

Mr Justice Meagher has reached a different view.

His Honour Mr Justice Meagher has said that so long

as his belief was "in good faith", and those are

the critical words -"in good faith" - that it was

honest, then the decision is supportable.

TOOHEY J:  He does not say that at all. He says -

DEANE J:	In good faith you are entitled to disregard documents which you reasonably think are
untrue.

Do you disagree with that?

MR KING: But, Your Honour, do you remember I called to

attention the word "reasonably"?

DEANE J: Yes.

MR KING:  The fact is that in this case it was never

suggested that the primary documents were a sham

and therefore one could not - - -

DEANE J:  If you are challenging His Honour's view that he

reasonably thought things were untrue, that is one

thing, but it is another thing to say that

Justice Meagher said what he did not say.

MR KING:  Oh no, Your Honour, no - - -

Darch 7 19/4/91

DEANE J:  And what he said was that if you reasonably think

documents are untrue you are entitled to disregard

them.

MR KING: Yes. That is so, Your Honour.

DEANE J: Well, you would not disagree with that, would you?

MR KING:  No, but the evidence disclosed - and these were

the findings of the judge - that there were no

documents that were untrue. All the primary

documents and, indeed, the judgment of

Mr Justice Mahoney, with whom Mr Justice Meagher

agrees on these points, show that the documents

were accurate and valid and therefore - - -

DEANE J: But what Mr Justice Meagher is saying, that he

reasonably thought the documents which showed

separate ownership were untrue. I follow you are

saying that Justice Meagher is wrong when he forms

a view that he acted reasonably in thinking they

were untrue but that is a question of fact, not the

question of law.

MR KING:  It is true to the extent that there is simply no

evidence that he thought that because it is not one

of the six factors listed.

TOOHEY J:  But you see, that misconception, Mr King, is

really built into the grounds of appeal, is it not? If you look at page 108, the draft notice of appeal

suggests that the:

Court of Appeal fell into error in:

(a) holding that it was sufficient for an

officer to be "acting in good faith" to effect

a valid seizure -

well, you would be hard put to extract that

proposition from the judgment of

Mr Justice Meagher.

MR KING:  And the next point raises it more precisely,

Your Honour.

TOOHEY J: Yes, but it analyses it with this notion of "in

good faith" but, as I read what Justice Meagher

says, "in good faith" really, just to clear away

any suggestion that the Customs officer was acting

maliciously.

MR KING: Yes.

TOOHEY J: But once you got rid of that notion, if it be

there at all, then the question is whether, in

terms of the section, he believed on· reasonable

Darch 19/4/91

grounds that the goods were forfeited goods. Well,

in effect, are you not asking us - and it is not to

suggest that you might not have some grounds for

doing so - really, to set aside the finding of fact

by Mr Justice Meagher on the ground it is not

supportable?

MR KING:	Your Honour, the proposition framed at line 22 is not framed as a finding of fact. It seems to be a
supposition that that is what he in fact did. But when one refers to the six points that, on his evidence, were present to his mind, those are
different considerations.

Your Honour, I do not wish to - I will

obviously follow this lead if Your Honours wish me

to do so but the point that I am really trying to

bring out at the commencement of these submissions

is that whilst Mr Justice Yeldham held that he had

no reasonable grounds for his decision, what

His Honour was basically saying was that granted

that or, in effect, "Let's assume that to be the

case; so long as he believed in good faith that

was the position, then he was entitled to disregard shipping and contractual documents which, in truth,

set out the real position".

Your Honours, there is absolutely no doubt in

this case that the Customs officer was wrong in his

decision, that is absolutely clear.

Mr Justice Yeldham held that he was wrong and so

did the Court of Appeal.

Can I just return to my submissions further in the case? Your Honours, there is a strange

superficiality about the way in which the court

dealt with the matter in the sense that there were

two seizures in this case, one of documents and one

of goods. Both of them were required to be done

upon reasonable grounds and both of them involved a

consideration of the same evidence and the same

facts. Yet, the Court of Appeal held that the

seizure of the goods was one that could be

justified but the seizure of the documents was one

that could not and I would respectfully submit that

that raises an issue as to the way in which the

matter was dealt with.

Your Honours, can I just take you back to

page 96 and, indeed, to the six factors that are

listed there on the top of the page? The second

factor that was taken into account was the view of

another officer of Customs. But as

Mr Justice Yeldham held, Mr Skevington who made the

decision himself never reached a view about it.

So, how can one justify a seizure of goods by

relying upon the opinion of somebody else?

Darch 9 19/4/91

Then, if we take the fourth factor - and I

have already indicated this - the orders were made

on a letterhead, granted, but the letters were

never read because if they had been read the true

position would have emerged. Does that mean that

every time a public official makes a decision

ignoring the true facts which were available to him at the time, that that decision cannot be impugned? That, with respect, would be the effect of the

decision.

Finally, perhaps the most important

consideration referred to by Mr Skevington is No 6:

that payments had been made from a -

single -

bank account.

But the officer of Customs failed to take into

account the true facts which were known to him at

the time - not referred to in his evidence - that

there was a letter of credit arrangement in respect

of one business and a 90-day draft facility in

respect of the other business. Each of them were

treated quite separately; absolutely clear to

anybody looking at the situation that it could not

have come from or been in respect of one owner.

Your Honours, accordingly, it is my respectful

submission that on the findings made in His Honour

Mr Justice Yeldham's judgment and in the Court of

Appeal, that irrelevant considerations were taken
into account, in this case, the opinion of

Mrs McCormack, the third person. Also, previous

transactions, given that there was no allegation
that there was any sham involved. In addition,

relevant considerations were not taken into

account: the contents of the orders; the contract

for carriage with the shipping company; the

contract for sale with the seller who, on the

evidence, breached the contract; no legal advice

was sought by the officer as to the meaning of the

word "owners" which, on Mr Justice Mahoney's view

and Mr Justice Yeldham's view was quite wrong.	He
failed to reach his own opinion as to what
"unassembled bicycles" actually meant.

TOOHEY J:	Mr King, how did Mr Justice Mahoney deal with the question of the findings of fact made by
Mr Justice Yeldham?
MR KING:	He agreed with them, Your Honour.
TOOHEY J:	He agreed with - - -?

Darch 10 19/4/91

MR KING:  Yes, but on the question that I am concerned with,

namely, whether my client can receive damages for

the wrongful taking of these goods, His Honour

Mr Justice Mahoney simply deferred to

Mr Justice Meagher. But on the critical question of title to the goods, our right to have the goods

back, all of those questions he agreed with our

case and Mr Justice Yeldham's decision.

TOOHEY J: Yes. It is not entirely clear to me to what

extent or on what basis Mr Justice Mahoney did

agree with Mr Justice Meagher. If you look at

page 75, line 10, His Honour says:

I have had the advantage of reading the

judgment of Meagher JA. His Honour's judgment

enables me to go directly to .... the main

issues for determination -

which I take to relate to whether the goods are

forfeited goods or not.

MR KING:  Yes.

TOOHEY J: Is that as far as the judgment goes in expressing

concurrence with Mr Justice Meagher?

MR KING: Yes, Your Honour, that is true.

TOOHEY J: Well, if it, indeed, does express any

concurrence. I suppose it is implicit.

MR KING: Well, I suppose it is, Your Honour. I think that

is correct. But Mr Justice Mahoney held that the

goods were not forfeited goods.

TOOHEY J: Yes, I appreciate that. My question was directed

at the issue of reasonable grounds - believing on

reasonable grounds. Did Mr Justice Mahoney advert

to that particular matter?

MR KING:  He just said "I don't think damages should be

awarded".

TOOHEY J: Well, there is a general agreement with

Mr Justice Meagher. That is really the answer to

my question.

MR KING:  Yes. You see, Your Honours, the difficulty that

any person involved in decisions of this type faces
is here, on 23 February 1987, before the decision
to issue the seizure notice was given, my clients

sent a letter to the Collector and set out the true

facts. That was ignored; not taken into

consideration, and then they seized the goods and

my client was ultimately held to have a right to

return of the goods, with compensation, according

Darch 11 19/4/91

to Mr Justice Yeldham, without it according to the

Court of Appeal.

Now, Your Honours, the situation is an

extremely, I would respectfully submit, Draconian

one for any person dealing with a public officer

knowing that that officer has that sort of power.

It is impossible to impugn a decision where

somebody says, "I believed on reasonable grounds

that my decision was right."

BRENNAN J: Well, it is possibly to impugn it if you can

show that there are no reasonable grounds.

MR KING: With respect, no, Your Honour, not if

Mr Justice Meagher is correct because officer thought he had reasonable grounds, not that

he, in fact, did have them and that is the critical

distinction which Mr Justice Barwich Chief Justice

brought out in Bradley's case and which Lord Atkin

brought out in Liversidge v Anderson.

Mr Justice Meagher made no finding of that type.

Your Honours, whilst it is tempting to suggest

that that was the way in which he was thinking,

upon analysis of what he said, he made no finding

of that type. He did not disagree with the finding

of His Honour Mr Justice Yeldham that the officer

had no reasonable grounds, in fact, for his

decision. What he said was that once he thought,

because of the six factors enumerated above,

together would reasonably justify belief, then the

goods are forfeited.

BRENNAN J: Well, we have heard your submissions on the

construction of Justice Meagher's judgment.	I do
not know that there is much more you can say.

MR KING: Yes. Your Honours, let us assume that I am wrong

in my understanding of what His Honour

Mr Justice Meagher said. That makes the situation

even worse because the Customs officer, knowing the

true facts, has ignored jurisdictional facts which

would have put the position right and my client

would not have suffered the grave injustice, with

respect, which he has.

The true facts were, as the documents

available to him at the time shows and which he

ignored, that there was a contract for carriage

with the ship and there was a contract for sale

with the seller by each of the applicants.

Now, Your Honours, can I just briefly take you

to some material to bolster my submissions that the

Court does require a public officer making

Darch 12 19/4/91

decisions in these circumstances to act upon facts

that are correct and which have support in fact.

BRENNAN J:  What do you mean by that?

MR KING: That he acts upon facts which, in fact, are found

to exist. In other words, he cannot ignore the

truth of the matter. He cannot say that X was the

owner when, in truth, Y was the owner.

BRENNAN J: But that is not the test that is in the section.

The test is "reasonable grounds".

MR KING: That is so.

BRENNAN J: So, the question can only be whether there are

grounds existing in fact which are reasonable.

MR KING:  The question is are there jurisdictional facts

upon which his decision can be based. One of those

jurisdictional facts is that, in this case,

Centurion was an owner of the goods.	The real
position was that it was not.

Now, Your Honours, in the Secretary of State

for Education v Tameside - - -

BRENNAN J:  What is your proposition, Mr King? What is your

proposition about the correctness of facts? Are

you saying that if a decision is based on a fact

which, although it appears to be true to the person

making the decision, is in fact false, the decision

is vitiated if it relates to what you call a

jurisdictional fact?

MR KING: Yes, and if he failed to take into

BRENNAN J: Is there any authority for that?

MR KING: Yes, Your Honour.

BRENNAN J:  What is it?

MR KING: Secretary of State for Education v Tameside,

(1977) AC 1014, and in particular in judgments of

Lord Denning, Lord Wilberforce and Lord Diplock.

Your Honours, there is also a very interesting
discussion in Paul Craig's book, Administrative

Law, 1989, which is set out in the papers attached

to my written submissions, which Mr Craig gives six

options for the test of a jurisdictional fact and

whilst it has been a long time since this Court has

considered the correct option to be taken in

relation to jurisdictional facts, in the context of

an officer having to be satisfied or having to act

on a belief on reasonable grounds, which is the

question at issue, none the less this Court has

Darch 13 19/4/91

indicated that more is required than simply an

honest belief that he had reasonable grounds.

Your Honours, that is set out in the papers

attached and referred to in the text at pages 292

and following.

Your Honours, the second point to which I

referred in my opening remarks was that the

decision is contrary to a prior decision of this

Court. Can I take you to the bundle and to item 3

which refers to Bradley v The Commonwealth? It is

about five pages in, Your Honours. Your Honours

may recall that was the case involving the Rhodesia

Information Centre. The passage to which I refer

is at page 574 at the bottom of the page in the

judgment of the Chief Justice and Mr Justice Gibbs.

I should refer you to about point 5, the relevant

section of the Act which requires the Postmaster-

General to be satisfied in relation to a decision.

He goes on towards the bottom of the page:

It is apparent that R v Arndel is quite

distinguishable from the present case and for

that reason it is unnecessary to express any

opinion as to the correctness of the grounds

on which the majority based their decision.

It may, however, be remarked that although the

power given bys. 57 is, as the Court held,

discretionary, it can only be exercised if the

Postmaster-General has reasonable ground to suppose one of the matters mentioned in the

section and, assuming that the words "has

reasonable ground is suppose" means that he

has in fact reasonable ground, rather than

that he thinks ·that he has reasonable ground -

reference is then made to Nakkuda Ali v Jayaratne

it may be thought that the validity of an

order made under that section would, nowadays

at least, be examinable.

Now, the same point is picked up - I think

Your Honour Mr Justice Brennan referred to in

Liversidge v Anderson is in the next case, at page 228 His Lordship

and the important and which

powerful dissenting judgment of Lord Atkin - and if

said:

If its meaning is the subject of dispute as to

legal rights, then ordinarily the

reasonableness of the cause, and even the

existence of any cause is in our law to be

determined by the judge and not by the

tribunal of fact if the functions deciding law

and fact are divided. Thus having

Darch 14 19/4/91

established, as I hope, that the plain and

natural meaning of the words "has reasonable

cause" imports the existence of a fact or
state of facts and not the mere belief by the

person challenged that the fact or state of

facts existed, I proceed to show that this

meaning of the words has been accepted in

innumerable legal decisions for many

generations that "reasonable cause" for a

belief when the subject of legal dispute has
been always treated as an objective fact to be

proved by one or other party and to be

determined by the appropriate tribunal.

Now here, Your Honours, the objective facts showed that there were no reasonable grounds for the decision of the officer, none, and that is undisputed.

Your Honours, as I said, Mr Craig in his work

sets out six possible tests for looking at the
question. Lord Diplock, in an important leading
case in 1985, The Council of Civil Service Unions
v the Minister for the Civil Service, which is the

second-last case in the bundle, refers to three

different tests. This was the case where

Mrs Thatcher, who was then the Minister for Civil

Service, required that there be no unionists in a

certain national security bureau, and at page 410

His Lordship sets out three categories for

impugning administrative decisions of this type

which are of relevance in determining the proper

approach. In particular he refers, at about

point 5 on the page, to "illegality",

"irrationality" and "procedural impropriety".

If we adopt each of those tests in this case

we see that the decision was illegal in the sense

His Lordship uses it, because on the true

construction of the word "owner" there was no basis

officer in question failed to take into account the for the decision. It was irrational because the	effective legal documents which were never at any
stage in this case submitted by the Collector to be
a sham. So here they were, documents which
disclosed the true facts irrationally, and one can put it on no other basis, not referred to. It was not just a case of being considered and rejected, a case of not referred to.
The other is "procedural impropriety". Your Honour, in relation to that, we submit
consistently with what this Court recently held in
Attorney-General for State of NSW v Quin, that
there is a legitimate expectation by persons importing goods into this country that they will
not be seized unless they are given some hearing

Darch 15 19/4/91

when they put the true facts to the public officer. decision for seizure was taken, not taken into

account, not given any - just simply not taken into

account, and that at page 20 in the

Attorney-General v Quin illustrates a clear defect,

"a procedural unfairness", to use His Honour's

words, in the decision taken.

Your Honours, can I finally submit that this is a matter which has wide-ranging public and

constitutional importance, and I use the word

"constitutional" in the sense used by Lord Salmon

in the decision that I referred to earlier, the

Tameside case.

In the case of The Crown v Parsons, it was

held that where a Court of Appeal or Full Court of

a State makes a decision on a federal matter, then

it has strongly persuasive import in other

jurisdictions in the Commonwealth. That is the

position here.

Secondly, the form of words used in the

statute, "believes on reasonable grounds", are widely used throughout public statutes in this country, not only in the Commonwealth, but in the

States, and it is a trigger for decision-making by

many persons in public office. We would submit

that it is of extreme importance that that matter

be considered by this Court, particularly given the

decision in Bradley.

Thirdly, Your Honours, if the decision is

allowed to stand, we would respectfully submit it
operates harshly because it makes, for example, and

this is just one minor example, it makes an attack

upon a decision by an officer in those

circumstances extremely difficult. One cannot

responsibly attack a decision by a public officer

on grounds that there was bad faith unless one
knows that to be the position.	One cannot allege

it. And the devil knoweth not the mind of a man in

these situations, and that is what is being tested.

What did he think in these situations? That is the

way the test is now being framed. It has been said

against us that if he thought that there were

factors which would reasonably justify his belief,

and I am using the words of Mr Justice Meagher,

then that is good enough. It cannot be attacked.

Then finally, Your Honour, it affects a

critical area of the operation of the Customs Act.

Murphy v Farmer, of course, was considered some

years ago by this Court an important landmark case.

This is the follow on from Murphy v Farmer.	In
Murphy v Farmer the question of forfeiture was

Darch 16 19/4/91

considered. That depends upon the operation and

construction of section 229 of the Customs Act.

This case depends upon the construction and

operation of section 203 of the Customs Act, and as

Your Honour Mr Justice Brennan said in Murphy

v Farmer, the effects of forfeiture are

devastating. The effects of seizure which actually

operate in possession, as it were, are even more

so.

Accordingly, it is my respectful submission

that leave to appeal should be granted.	The case
is one of particular public importance.	The issues

of construction are, of course, finely critical to

the result of the case, and I would respectfully

submit this is a case in which leave should be

granted. If the Court pleases.

Your Honours, the appeal book did not contain

the orders of the Court of Appeal. For some reason
they were omitted. That is at pages 68 and 69.

Can I hand up the orders? They are of some

importance because it illustrates that the court

only set aside the order in relation to seizure of

goods and not seizure of documents.

BRENNAN J: Yes, thank you, Mr King. We need not trouble

you, Ms Beazley.

As we read the judgment of Mr Justice Meagher

in the Court of Appeal, His Honour came to the
conclusion that there were reasonable grounds for

believing that the goods seized were forfeited

goods. The other members of the court agreed with

that conclusion. That being so, there is no

question of law relating to the conditions
governing the power of seizure under section 203 of
the Customs Act 1901 of the Commonwealth which

justifies the grant of special leave to appeal.

Accordingly, special leave will be refused.

MR KING: If the Court pleases.

MS BEAZLEY	I make an application for costs.
BRENNAN J:	Do you have anything to say about costs,

Mr King?

MR KING: No, Your Honour. Well, yes, Your Honour, I do

wish to say something briefly about costs.

Your Honour, the Court of Appeal made a rather

unusual order in relation to costs. The court

basically said, "You can have your goods back but

you won't get any damages for the loss of them."

Your Honour, we still do not have the goods back.

Darch 17 19/4/91

They are still in the Customs' hands. When we get

them back they are going to be next to worthless.

Your Honour, we were entitled to the goods.

They should never have been taken on the finding of

the courts and now - - -

DEANE J: Well, why have you not got them back?

MR KING:  Because the Collector still has them in his

possession. We got a letter from the Collector

recently to say that if this appeal proceeds they

are going to cross appeal and claim that we were

never entitled to be the owner of the goods - to be

held to be the owner of the goods.

Now, Your Honours, my two clients are very small business people. I can say, fairly, from the

bar table that this case is basically - that the

seizure of these goods has effectively reduced the

company to very straitened circumstances - the two

companies, the businesses of Mr and Mrs Darch and

the business of GMI - and I would respectfully

submit that if Your Honour is to make any order as

to costs it ought to be an order for costs of the

sort made in the Court of Appeal.

BRENNAN J: Which is what?

DEANE J: It was a half order for costs in the Court of

Appeal, was it not?

MR KING:  Yes. Well, in fact, my submission is that there

be no order as to costs.

BRENNAN J:  Ms Beazley, is it the fact that these goods have

not been returned?

MS BEAZLEY:	Your Honour, the first I have heard about anything like that is the submission which has just
been made.
ear which would indicate that that is so but, I have had something whispered in my
again, from that which I have been able to pick up
within the seconds available to me, is that - I am
not sure that there has been a request put in place
for them in a sense that the companies, so far as I
know, have not gone and said, "When can we have them?"

DEANE J: Well, it does not really need to request, does it,

when it has taken you to court and to the Court of

Appeal and won?

MS BEAZLEY:  Yes, but one - I mean, usually there is a

communication about these things and, as I

understand it, there has not been a Gommunication

but I would not like what I am saying to be taken

Darch 18 19/4/91

too far because it really is only in these very

moments that I have even been able to pick up

anything about what is going on about this. There

has, as I understand it, been a recent letter

indicating that if special leave was granted then

an application for cross appeal would be filed and

raising the question of whether - I am sorry, I am

being shown something further, Your Honour. Would

you just give me one moment so that I can see if I

can pick this up on the run?

Your Honour, I think what seems to have happened is that on 25 January 1991 those that

instruct me wrote to the solicitors for the

defendant saying that "your client hasn't asked for

the returns and whilst it is acknowledged that they

may not need to, it does beg the question of what

the position will be on the High Court's

reconsideration of the matter, should that occur"

and there was a question that they might alert them

to - it was, in effect, saying, "Do you agree to

the matters staying as they and if you don't, you

might alert me if you have any problems with the

status quo, that is, the retention of the goods

pending the outcome of, initially, the special

leave application?"

TOOHEY J: But the only possible basis for obtaining the

goods would be if there is to be a cross appeal

seeking to argue that the goods were forfeited

goods.

MS BEAZLEY:  And that was indicated that that would occur if

special leave was granted.

TOOHEY J:  I am not to be taken as suggesting that is a

ground of itself for justifying retention but that

seems to be the only conceivable basis upon which

retention could be supported.

MS BEAZLEY:  Yes. Your Honour, what the letter raised was

the fact that they had not asked for them,

acknowledging that strictly that was not necessary,

indicating that if a special leave application was

successful there would be a cross appeal saying,

"We might have to apply for a stay if you want the

goods back. Do you have anything to say to us on

leaving the matter as is, that is, the goods with

us pending the outcome of the special leave

application?" and I assume, from what I have b·een

told, there was no response to any of that. So,

with respect, we are really not as gross in our

conduct as is being suggested.	We have raised it
fully.

BRENNAN J: But is it right to say that without any stay

order being obtained from the court, y·our clients

Darch 19 19/4/91

assumed to exercise a power to retain the goods

simply because you wished to - - -

MS BEAZLEY:  With respect, I do not think they did that.

They have asked them, "Do you have any problems

with the status quo?" In other words, "Do you

consent to this or do we have to consider our

position and apply for a stay application?", and

there was no response to that, Your Honours. So,

with respect, the only criticism that perhaps could

be directed to my client is whether that letter

ought to have been written prior to 25 January, the

Court of Appeal decision coming down, I think it

was, on 19 October.

DEANE J:  Which left in tact an order that the goods be

delivered forthwith, an order that had been made

more than two years ago.

MS BEAZLEY:  Yes.

DEANE J: It is about time they were delivered, is it not?

MS BEAZLEY: Yes, there is no doubt about that, Your Honour.

But that is the factual circumstances as I can put

it to Your Honours. With respect, Your Honours, as

hard as it sometimes is to make a submission,

knowing that there is perhaps fault on perhaps both

sides in matters, the matter which has been raised

by my learned friend really does not touch upon the

question of costs of this application.

DEANE J:  Why not, if your client has seen fit, without

applying for a stay, to use this application for

special leave to unlawfully hold goods from the

applicants?

MS BEAZLEY:  Your Honour, the answer to that is, with

respect, that to the extent that the letter went

out on 25 January of this year, that course has

been conceded, it has been accepted.

DEANE J:  If your client wishes to disregard the order made

that it return the goods forthwith, it could either

seek a stay or it could, itself, seek to appeal.

The one thing it could not do was simply ignore the

order which is precisely what it has done.

MS BEAZLEY:  No. I accept those criticisms, Your Honour,

except to this extent: that must be limited to the

extent that when communication was made there has

been, in effect, a concurrence by silence, we would

say, by a non-response to that letter in respect of

the goods.

BRENNAN J:	Ms Beazley, leave aside the question of costs for the moment. Is your client liable in damages
Darch	19/4/91

to the applicant for the retention of the goods in

breach of the order for the delivery? Because, if

so, is there any reason why the order for costs

should not be made contingently upon the assessment

of those damages and the setting off of them?

MS BEAZLEY:  Your Honour, we would say the answer is "No" to

Your Honour's proposition, and we would say it is

"No", given the factual circumstances which I have

outlined.

DEANE J: Very well and very bravely, if I might say so.

BRENNAN J: There is probably nothing else you can assist us

with, Ms Beazley.

MS BEAZLEY:  I think that is probably right, Your Honour.

BRENNAN J: There will be no order as to costs.

AT 4.00 PM THE MATTER WAS ADJOURNED SINE DIE

Darch 21 19/4/91