Department of Transport v Ali

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION

S CI 2011 1856

DEPARTMENT OF TRANSPORT	Plaintiff
v
ABDI MAHAMOUD ALI	Defendant

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JUDGE:	DALY AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	19 August 2011, further written submissions filed 2 November 2011
DATE OF JUDGMENT:	10 November 2011
CASE MAY BE CITED AS:	Department of Transport v Ali
MEDIUM NEUTRAL CITATION:	[2011] VSC 564

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CATCHWORDS: Appeal from VCAT – Tendering process for taxicab licences – Statutory construction.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr J Pizer with Mr E Nekvapil	Department of Transport Legal
For the Defendant	No appearance

HER HONOUR:

Background and Issues

On 26 July 2010 the respondent, Mr Ali, applied for a taxi‑cab licence following an announcement made by the Victorian Government in December 2009 that it would issue up to 530 new taxi‑cab licences in the Greater Melbourne area. The responsibility for allocating the new licences was delegated by the relevant Minister to the appellant, the Director of Public Transport (“Director”).[1]
[1]By reason of s 316(1), the responsible authority is now the Secretary to the Department of Transport. The use of the term “Director” reflects the position at the time of the defendant’s application for a taxi-cab licence and the VCAT hearing from which the appeal is brought.

The accreditation and licensing of taxi‑cab drivers is governed by Part 4 of the Transport Act 1983 (Vic) (“Act”).[2] Section 143A of the Act provides as follows:
[2]On 1 July 2010, the Transport Act 1983 was renamed the Transport (Compliance and Miscellaneous) Act 1983.

(1)The Minister may, by Order published in the Government Gazette –
(a)proclaim an area or areas as a taxi-cab zone or zones;
(b)specify whether the fees to be paid for taxi-cab licences are to be determined by tender or are to be a fixed price;
(c)specify the classes of people and the qualifications of people eligible to apply and the procedures to be followed for the granting of taxi-cab licences;
(d)specify the particulars that must be included in an application for a taxi-cab licence;
(e)specify the date by which applications for taxi-cab licences must be lodged with the licensing authority;
(f)provide that all applications for taxi-cab licences to operate in a proclaimed zone made before a specified time are to lapse.

On 28 June 2010 the Minister published the following Order in the Victorian Government Gazette:
I, the Hon Martin Pakula MP, Minister for Public Transport, by Order under section 143A of the Transport Act relating to the granting of taxi‑cab licences in taxi-cab zones:
Taxi-cab Zones
1.proclaim the Metropolitan Taxi-Cab Zone as a proclaimed taxi‑cab zones for the purpose of this Licence issues;
2.proclaim the Outer Suburban Taxi-Cab Zones as a proclaimed taxi‑cab zone for the purpose of this Licence issue;
Characteristics of licences
3.specify that each Fixed-Term Licence may be granted for a fixed term of 10 years only. This term will commence on the date the Fixed-Term Licence is granted by the licensing authority;
4.spicy that each Fixed-Term Licence will be subject to a condition that the Fixed-Term Licence cannot be assigned.
Note:The information in paragraph 4 is stated for the purpose of section 143D(2) of the Transport Act; the non-assignment condition will be imposed under section 143D(1)(b) of the Transport Act.
Licence Fee
5.specify that the licence fee to be paid for each Fixed-Term Licence is to be determined by tender, in accordance with Part C of the Rules;
Note: The licensing authority may allow the licence fee to be paid by instalments (section 143A(10)). Application fees, annual fees and any other applicable fees determined by the licensing authority under section 147B of the Transport Act must be paid in addition to the licence fee.
Class and qualifications of persons eligible to apply
6.specify that a person is eligible to apply for a Fixed-Term Licence if and only if the person satisfies the eligibility requirements specified in rule 6.2 of the Rules;
Procedures
7.specify that the procedures to be followed for the granting of Fixed‑Term Licences by the licensing authority are the procedures set out in Parts B to D of the Rules
Particulars
8.      specify that:
8.1each application for a Conventional Fixed-Term Licence must include a completed Application Form specified to be applicable to applications for that licence type; and
8.2each application for a WAT Fixed-Term Licence must include a completed Application Form specified to be applicable to applications for that licence type.
Due date
9.specify that each application for a Fixed-Term Licence must be lodged with the licensing authority on or before the relevant due date; and
10.     the relevant due dates are:
10.1     Conventional Fixed-Term Licenses: 26 July 2010; and
10.2     WAT Fixed-Term Licences: 13 September 2010.
…
(7)An application for a taxi-cab licence must be accompanied by –
(a)any particular required by the Order; and
(b)the appropriate application fee determined under section 147B.
(8)The licensing authority may grant taxi-cab licences to applicants at any time within one year of the closing date for applications.

The Rules referred to in the Order (“Rules”) were annexed to the Order, and, relevantly, contained the following:

3.6Phases in the Application Process
There are three phases in the Application Processes for Fixed‑Term Licences governed by these Rules:
3.6.1 Phase 1: Initial Application Process (described in Part B)
(a)Applicants lodge their Applications using the applicable Application Form and are assessed against the Eligibility Criteria.
(b)Applicants who meet the Eligibility Criteria become Phase 2 Applicants.
(c)Applicants who do not meet the Eligibility Criteria are ineligible for a Fixed‑Term Licence and their Application will be refused by the Licensing Authority.
…..

6.Eligibility
6.1Entitlement to lodge
6.1.1A person is only eligible to apply for a Fixed‑Term Licence if that person satisfies the Eligibility Criteria.
Note:Satisfying the Eligibility Criteria does not mean that a person is eligible to be granted a Fixed‑Term Licence. The persons who are entitled to be granted a Fixed‑Term Licence will be determined by the Licensing Authority in accordance with these Rules.

6.2.1Each person who satisfies the Eligibility Criteria may lodge one Conventional Application Form and/or one WAT Application Form.

6.2Eligibility Criteria
The Eligibility Criteria are as follows:
6.2.1The person must be:
(a)a natural person;
(b)a partnership;
(c)a company;
(d)a co-operative;
(e)an incorporated association; or
(f)a body corporate,

but must not be an unincorporated body or association (other than a partnership).
6.2.2The person’s Application must:
(a)be lodged with the Victorian Tax Directorate on or before the applicable Due Date;
(b)include at least one signed Bid Form;
(c)include the following information or documentation:
(i)if the Applicant is a natural person:
·     The Applicant’s full name and one or more of the following:
-      valid residential address;
-      valid contact phone number; or
-      valid email address;
·     copies of two forms of proof of identity evidence in compliance with the requirements stated in the Application Form;
·     a copy of a signed privacy consent and statutory declaration in compliance with the requirements stated in the Application Form;

…
6.2.3At the time of lodging the Application, the person must not be disqualified from applying for accreditation as a taxi-cab licence holder or taxi-cab operator in Victoria under sections 132H or 135A of the Transport Act.
6.2.4At the time of lodging the Application, the person, or a Relevant Person in relation to that person, must not:
(a)currently be an undischarged bankrupt under the law of Australia or any place outside Australia;
(b)currently be disqualified from managing a corporation under Part 2D.6 of the Corporations Act or under the law of any place outside Australia; or
(c)have been found guilty of an offence against section 209(3) or Part 5.8 of the Corporations Act or of an offence against a law of a place outside Australia that corresponds to that section or Part.
…

6.2.6At the time of lodging the Application, the person must be able to provide evidence to the Licensing Authority that the person has the financial capacity to act as a taxi-cab licence holder and taxi‑cab operator for the maximum number of Fixed‑Term Licences applied for by the person in the Application (with such evidence to be signed by an accounting practitioner and provided in a form determined by the Licensing Authority and included in the Application Form).
…
6.2.9If the person is a natural person, at the time of lodging the Application the person must be a resident of Australia.
…
Note:If an Applicant fails to meet any of the Eligibility Criteria, the Licensing Authority must refuse the Application.
7.Applications
7.1Application Form
7.1.1All Applications for Conventional Fixed-Term Licences must be made using a Conventional Application Form.
…
7.1.3Applicants must complete all information as required in the applicable Application Form and must provide all documents and evidence requested in the Application Form.

…
8.Eligibility check
8.1Check
The Licensing Authority will check all Applications lodged in accordance with these Rules to determine whether the Applicant has met the Eligibility Criteria.
8.2Phase 2 Applicant
8.2.1If an Applicant meets the Eligibility Criteria, that Applicant becomes a Phase 2 Applicant and the Application will progress to the Tender Process.
8.2.2If an Applicant does not meet the Eligibility Criteria, the Licensing Authority must refuse the Application.

“Eligibility Criteria” is defined in clause 1.1 of the Rules as “the criteria described in Rule 6.2.”

The relevant application form was contained in an information pack made available by the Director to potential applicants.

The number of applicants for conventional taxi‑cab licences (for which Mr Ali applied) was 1,010. The Victorian Government had determined to issue up to 200 new conventional taxi-cab licences.[3]
[3]Witness statement of Tony Eric Hayward dated 18 February 2011, exhibited to the affidavit of Katherine Patricia Roberts sworn 17 May 2011, paragraphs 6 and 44.

As referred to above, there were three phases in the application process.

Phase 1 Initial Application Process: In the Initial Application Process, applicants were required to lodge their applications with the Department by the due date. After the due date when all applications had been received, the applications were opened and the information contained within them assessed to determine whether or not the applicant was eligible to apply.
Phase 2 Tender Process: In the Tender Process, the licence bids made by the eligible applicants who progressed through the Initial Application Process were ranked to allow the Director to determine which applicants would have a bid selected for allocation of a taxi-cab licence and offered the opportunity to proceed in the application process.
Phase 3 Accreditation Process: In the Accreditation Process, applicants with a bid or bids selected in the Tender Process were required to satisfy the requirements set out in Part D of the Procedural Rules before a taxi-cab licence could be granted.[4]

[4]Witness statement of Tony Eric Hayward, paragraph 12.

On 26 July 2010 (the due date specified in the Order) , Mr Ali submitted an application for a conventional taxi‑cab licence. Mr Ali’s application was deficient in three respects:

(a)the copies of his proof of identity documents were not certified as true copies (or at all) in accordance with clause 6.2.2(c)(i) of the Rules;
(b)the certificate executed by Mr Ali’s accountant failed to specify the maximum number of licences applied for by Mr Ali in accordance with clause 6.2.6 of the Rules; and
(c)Mr Ali failed to sign Section L of the application form in accordance with Rule 6.2.2(c)(i), which, among other things, authorised the Department of Transport to collect and use his personal information, and declared that the information provided in the application form was true and correct.

As a result of the deficiencies referred to above, the Director rejected Mr Ali’s application on 27 August 2010. Mr Ali applied under s 143C of the Act to the Victorian Civil and Administrative Tribunal (“VCAT”) for a review of the Director’s decision to refuse the application. On 23 March 2011, the Tribunal Member set aside the decision of the Director, and remitted Mr Ali’s application back to the Director to be determined in accordance with the Tribunal Member’s reasons (“reasons”).

The Director applied for leave to appeal against the Tribunal Member’s decision. Leave was granted on 17 May 2011 and the orders made by VCAT stayed. The Director filed and served a notice of appeal on 26 May 2011, which identified the following questions of law:

1.Did clause 8.2.2 of the procedural rules attached to the Order made by the Minister for Transport under section 143A of the Transport (Miscellaneous and Compliance) Act 1983 (“the Rules”) compel the Appellant (“the Director”) to refuse an application for a fixed‑term taxi licence under that Order if the person making that application had not met the criteria set out in clause 6.2.2(c)(i) of the Rules?
2.If:
(a)an applicant for a fixed-term taxi licence had not met the criteria set out in clause 6.2.2(c)(i) of the Rules;
(b)the Director had decided to refuse the application on the basis that the applicant had not met those criteria;
(c)the applicant had applied to the Tribunal for a review of that decision; and
(d)the Tribunal found that the applicant had not met the criteria set out in clause 6.2.2.(c)(i) of the Rules –

did clause 8.2.2 of the Rules compel the Tribunal to affirm the Director’s decision on the basis that the applicant had not met those criteria?

The grounds of appeal relied upon by the Director are as follows:

The grounds of appeal upon which the Appellant relies are as follows:
As to question 1:
1.The Tribunal erred in determining that the requirements in clause 6.2.2(c)(i) of the Rules were procedural matters that could be corrected after the application had been made.
2.The Tribunal erred in failing to determine that, if the requirements in clause 6.2.2(c)(i) of the Rules had not been met, clause 8.2.2 of the Rules gave the Director no choice but to refuse the application.

As to question 2:
1.The Tribunal erred in determining that it was able to ask itself whether the Director should have given the applicant the opportunity to correct the non-compliance with clause 6.2.2(c)(i) of the Rules.
2.The Tribunal erred in failing to determine that, on a review of a decision to refuse an application for a fixed-term taxi licence on the basis that the applicant had not met the criteria set out in clause 6.2.2(c)(i) of the Rules, clause 8.2.2 of the Rules gave the Tribunal no choice but to affirm the Director’s decision where it had found that the applicant had not met those criteria.

Mr Ali was legally represented at the hearing at VCAT, but did not appear at the hearing of the application for leave to appeal, or at the hearing of the appeal.[5] However, the reasons enabled me to identify and evaluate the competing arguments regarding the issues in the appeal. These issues are:

(a)whether the Director was empowered to excuse Mr Ali’s non‑compliance with the matters specified in clause 6.2 of the Rules;
(b)if the answer to (a) above is yes, should the Director have excused Mr Ali’s non‑compliance, or have drawn Mr Ali’s attention to the deficiencies in his application form in order to enable him to correct these deficiencies; and
(c)if the answer to (a) above is no, was VCAT empowered to set aside the Director’s decision to refuse the application?

[5]The affidavit of Katherine Patricia Roberts sworn 18 August 2011 confirms that Mr Ali was notified of the hearing date and provided with a copy of the appeal book.

Counsel for the Director submitted that, by reason of the terms of the Order and the Rules, the Director did not have the power to excuse non‑compliance with the terms of the Order and the Rules, regardless of how trivial the deficiencies in the application form might be, or how harsh the impact of a refusal to excuse non‑compliance might be upon an applicant in the position of Mr Ali. As VCAT’s jurisdiction upon review is no greater or less than that of the original decision‑maker, the Tribunal Member was not empowered to set aside the Director’s decision to refuse the application.

Counsel submitted that the appropriate course for the Court if it found in favour of the Director upon the questions of law in the appeal was to make an order pursuant to s 148(7)(b) of the Victorian Civil and Administrative Tribunal Act 1998 (“VCAT Act”) to affirm the decision of the Director to refuse Mr Ali’s application for a taxi‑cab licence. Counsel submitted that this is an appropriate case for such relief, on the basis that if the Director succeeds in the appeal, the only lawful order that VCAT could have made would be to affirm the Director’s decision: as such, a remitter to VCAT under s 148(7)(c) of the VCAT Act would be futile.

VCAT’s decision

In the absence of a proper contradictor upon the appeal, it is necessary to set out the key findings of the Tribunal Member in some detail.

The key findings of the Tribunal Member (using the paragraph references in the reasons) were as follows:

[9]Because the applicant’s application was rejected in Phase 1 of the tender process, the substance of the applicant’s application was not considered and the fact that his bid for the licence exceeded the minimum bid which would have been successful, in all probability, without determining the same, it is likely that had the problems referred to in the application form not occurred, the applicant would have been successful in his bid. Of course, I am unable to determine that factor with any certainty. However, it is clear that the substantive parts of the application were not considered in Phase 2 or acted upon in Phase 3 because the applicant’s application did not pass Phase 1.

…
[23]In this particular instance, it is clear from s 143A(1)(c) that the legislature has used the words in relation to the eligibility criteria: “specify the class of people and the qualifications of people eligible to apply” (highlight supplied).
[24]In Words and Phrases Legally Defined Volume (Fourth Edition) at p 714, the authors dealing with the word “qualified” cite from the Canadian case Schauerte v Wawanesa Mutual Insurance Co (1959) 27 WWR 618 at 620, Alta SC, per Cairns J; affirmed 29 WWR 560, Alta SC, when they state:
“It is a matter of fact whether anyone may or may not be qualified [to drive a motor vehicle], in other words, qualified is synonymous with competent or being capable of driving … In my view, the principle established … is not that ‘qualified’ goes to the matter of obtaining a permit, but qualified means exactly what it says, that is, whether a person is or is not capable of operating a motor vehicle, and if he is so the policy is not voided.”

[25]In this particular instance, it is clearly incorrect to say that the ability to fill out the forms correctly can amount to a qualification. It cannot. Therefore, in my view, it cannot relate to eligibility.

…
[29]In this particular instance, reading the words in the way suggested in the Project Blue Sky case means that the criteria referred to in 6.2.2 and 6.2.6 of the Rules cannot and is not eligibility criteria even though that is the heading that that section of the rules contains.
[30]I accept that if the Minister wished, he does have power pursuant to the statute to make a rule saying that particular matters are essential to an application and if those matters are not completed 100% correctly then the applicant would not be able to take part in the selection of the application process. The Minister has not stated that matter or any other similar matters in the Rules. Merely by putting requirements in a particular place in the order, as has happened here, does not, without being clarified by the Minister, make those requirements essential parts of the application which cannot be looked at or varied during the consideration process, that is, between 26 June and 27 August 2010. Put a different way, even though the requirements in 6.2.2 and 6.2.6 appear to make those matters eligibility criteria, they are in fact not eligibility criteria, they are as I said in Dimitrakopoulos merely procedural matters which could be corrected. Neither does it assist looking at the definition in the Ministerial Order that “Eligibility Criteria means the criteria described in rule 6.2”. The Minister has not said what criteria should in fact be eligibility criteria in itself. Merely putting criteria under the heading of “Eligibility Criteria” does not make it eligibility criteria per se particularly in light of the reading of s 143A(1)(c).
[31]Thus I have come to the view as I did in Dimitrakopoulos case (referred to above) that not filling in the forms correctly and not having the identity certified, does not invalidate the application or make the applicant ineligible to pass through to Phase 2 of the assessment process. To take a different interpretation would be contrary to the legislative intention of s 143A and the objects contained in s 4(1) of the Transport Act 1983.
…
[34]As I have already found that the alleged eligibility criterion was not in fact an eligibility criterion, it necessarily follows that because there was a failure to complete the forms in the way required by the Director, that he is not entitled to refuse the application without going further.
[35]Thus, the Tribunal is able to ask itself should the Director have in fact gone further and given the applicant the opportunity to correct or complete deficiencies that were in his application form. There seems to be no reason why the Director could not have contacted the applicant and people in such a position and given them the opportunity to correct the forms. That was done by the Director in relation to matters in 6.2.6. Therefore, it is hard to accept that there would have been difficulties in contacting the people concerned and allowing them to make corrections before 27 August 2010. Mr Nekvapil said that there were over 1000 applications. While it may have required the application of further resources of the Director, that in itself does not make the task not practical.
[36]It is also necessary to ask what were the components of the Director’s decision. Clearly, the Director refused to grant the application. But in making that decision, the Director necessarily made a number of other decisions including not to give the applicant and other relevant applicants a chance to correct deficiencies in their form. Section 4(1)(h) of the Victorian Civil and Administrative Tribunal Act 1998 makes it clear that it is a ‘decision’ where a person, “does or refuses to do any other act or thing”. Thus, refusing to give the applicant an opportunity to amend matters that were purely formal in the application form is a decision of the Director and is subject to review. That decision is one of the components that made up the decision of the Director of 27 August 2010 which is the decision under review by this Tribunal.

…
[41] As I stated in the Dimitrakopoulos case at paragraph 13:
“…. this Tribunal is a merits review tribunal and it does have jurisdiction if a proper procedure has not been followed, that is a proper and fair procedure. I am bound to come to the proper and preferable decision and substitute my decision for that of the respondent. That is done by a hearing ‘de novo’.
[42]Therefore, I find that the Tribunal has power to review the whole decision, which includes the decision not to give the applicant a chance to remedy procedural defects in his application form.

…
[50]In this proceeding, I have already referred to the fact that even though the requirements of 6.2.2 and 6.2.6 refer to eligibility requirements, it was clearly not the intention of the Minister that there should be eligibility requirements. If the Minister had intended there should be, he could have stated so clearly in the order, he did not. Merely putting those requirements under the heading of “eligibility” does not, in my view, alter their character.

…
[56]Mr Nekvapil’s argument in relation to this matter depended upon the interpretation that the applicant was ineligible because he had not provided all the required information contained in Rules 6.2.2 and 6.2.6. As such, he submitted that the applicant was ineligible.
[57]I have already dealt with this point of ineligibility earlier. In my view, on the proper reading of the statute and rules, the matters referred to in this proceeding, while they are under the heading of “eligibility” in Rule 6, are not in fact matters that deal with eligibility. They are procedural only.
[58]Mr Nekvapil further submitted that the Director had no power to waive the requirements of 6.2.2(c) of the Rules.
[59]I do not agree with this submission for the reasons stated above. However, what the applicant would be seeking was the ability to remedy the problem, not have it waived.

…
[62]In this particular instance, there appears to be no reason why the Director could not have allowed procedural matters to be rectified in the application form. That could have been done at any time up to 27 August 2010 when the decision was made.
[63]Given those circumstances following what was said in the ASIC case, it would appear to me that there is no reason why this Tribunal could not give the applicant power to remedy his application even though it is clearly after 27 August 2010.
[64]The powers of this Tribunal in the review jurisdiction are to enable any correction of a wrong by a decision‑maker. In this particular instance, in my view, it is wrong that the decision‑maker did not notify the applicant of the defects in his application and allow the same to be corrected. Therefore, there is no reason why this Tribunal does not have jurisdiction to do the same.

…
[71]Given these matters, in my view, it is proper that I exercise the discretion I may have in favour of the applicant. To do otherwise would work a considerable injustice to him. In Dimitrakopoulos at paragraph [17], I stated:
“in my view, it cannot be the purpose of this legislation, that is, the Transport (Compliance and Miscellaneous) Act 1983 or the Ministerial Rules that only suitable and eligible applicants are those that are able to meticulously fill in a form and have it signed and be correct in every detail. This is not an application for lawyers to practise, it is an application for people to obtain a taxi licence. One would not expect those people to be meticulous in every detail in filling out a form in the sense that one would expect of a lawyer. In relating to the statutory declaration in 6.2.2(ii) dot point 3, is a procedure in form only.”
[72]In all the circumstances of this proceeding, I find that the respondent erred in not giving the applicant an opportunity to correct matters concerning his application and it is proper that I exercise my discretion and allow the applicant to rectify the problems in his application. That being the case, it is proper that the order I should make is to set aside the decision of the respondent and remit the matter back to the respondent to be decided in accordance with the above reasons.

Accordingly, the Tribunal member’s decision was based upon a number of conclusions:

(a)there is a distinction between the “substantive” eligibility criteria and the “procedural” requirements specified in clause 6.2 of the Rules, in that the Tribunal Member found that the Director is entitled to disregard or waive the latter when considering applications for taxi‑cab licences, and, in order to be fair to Mr Ali, he should have in fact done so;
(b)while the Minister does have power pursuant to the Act to state that particular matters are essential to an application (such that any application which did not comply with those requirements would be rejected), the Minister had not made such a statement in this case;
(c)the only relevant “eligibility criteria” required to be fulfilled by the applicant were those matters relevant to an applicant’s qualifications to hold a taxi‑cab licence (without stating what those qualifications are), and that any other matters were merely “procedural requirements”. An ability to accurately complete an application form is not truly an “eligibility criterion”;
(d)the decision by the Director not to provide Mr Ali with an opportunity to correct the deficiencies in his application is a “component” of the Director’s decision to refuse Mr Ali’s application, and as such is reviewable under s 143C(1) of the Act; and
(e)the decision not to allow Mr Ali to correct the deficiencies in his application was unfair and unjust.

The Tribunal Member also appeared to place some weight upon the fact that the Director had adopted a policy of allowing applicants to correct errors in their application forms where the only error was that the accountant providing a certificate of financial capacity required by clause 6.2.6 of the Rules had failed to specify the numbers of licences the applicant was applying for.[6] While Mr Ali had made a similar error, he was not a beneficiary of this policy because of the other deficiencies in his application.
[6]Witness statement of Tony Eric Hayward, paragraphs 33-41.

The reference to Project Blue Sky in paragraph 29 of the reasons is no doubt intended to refer to the well known statement of the High Court that:

… the duty of a court is to give the words of a statutory provision the meaning that the legislature is taken to have intended them to have. Ordinarily, that meaning (the legal meaning) will correspond with the grammatical meaning of the provision. but not always. The context of the words, the purpose of the statute or the canon of construction may require the words of a legislative provision to be read in a way that does not correspond with the literal or grammatical meaning.[7]

[7]Project Blue Sky Inc v Australian Broadcasting Authority (1998) CLR 355 at 384.

Accordingly, the Tribunal member found that the reference to “qualification” in s 143A(1)(c) of the Act meant that the term “eligibility criteria” as referred to in clause 8.2 of the Rules did not extend to all matters referred to in clause 6.2 of the Rules, but only those matters relevant to a person’s qualifications or competence to hold a taxi‑cab licence.

The Tribunal member’s decision in this application (and, apparently, in the earlier Dimitrakopoulos decision) is dependent upon any distinction between “substantive” eligibility criteria and “procedural requirements” in the Rules. If that distinction is open to the Tribunal, no legal error is discernible. If such a distinction is not open to the Tribunal, this misconstruction of the terms of the Rules would amount to an error of law.

Ought the appeal be allowed?

In relation to the first question of law identified by the Director in the Notice of Appeal: that is, whether clause 8.2.2 of the Rules required the Director to refuse an application by a person who had not met the criteria set out in clause 6.2 of the Rules, the Director submitted as follows:

(a)section 143A(2) of the Act required the Director to exercise his discretion to grant a taxi‑cab licence “subject to” the Order (including the Rules);
(b)the Rules required the Director to refuse an application if the applicant did not meet the criteria set out in clause 6.2 of the Rules (regardless of the character or nature of the criteria); and
(c)the Director had no choice or discretion in the matter, because the procedures prescribed by the Order and the Rules were mandatory, regardless of whether the matters set out in clause 6.2 of the Rules could be properly characterised as eligibility criteria or not.

In relation to the second question as to whether clause 8.2.2 of the Rules compelled the Tribunal to affirm the Director’s decision, the Director submitted that the Tribunal Member was in error when it concluded that it was able to ask itself whether the Director should have gone further and given Mr Ali the opportunity to correct or complete the deficiencies in his application form. In particular, given that neither the Act, the Order or the Rules conferred upon the Director the power to waive compliance with clause 6.2.2 of the Rules or the Order, VCAT was not authorised or empowered by those instruments or the VCAT Act to compel the Director to excuse non‑compliance, or to otherwise provide Mr Ali with an opportunity to correct the deficiencies in his application.

The Director submitted that the decision of the Director to allow applicants who had failed to adequately comply with clause 6.2.6 of the Rules to rectify any deficiencies in that part of the application form could not be relied upon by the Tribunal to make a finding that the Act, the Order or the Rules authorised or compelled the Director to allow applicants such as Mr Ali to correct any deficiencies in their applications, as the interpretation of a statute by VCAT or this Court cannot be influenced by the interpretation adopted by the agency responsible for administering that statute.[8] Further, the existence of such a policy should not affect the discretion of this Court to refuse to grant the relief sought by the Director in this appeal.
[8]See Corporation of the City of Enfield v Development Assessment Commission (2000) 199 CRL 135 at 151-153 and Minister for Immigration and Citizenship (2008) 169 FCR 202 at 206-207.

Finally, as previously noted, the Director submitted that the appropriate relief was to affirm the Director’s decision to refuse Mr Ali’s application for a taxi‑cab licence, as this was the only lawful outcome of the hearing before VCAT.

For the reasons that follow I agree with counsel for the Director that the appeal should be allowed, and that I should grant the relief sought by the Director.

In particular, I agree with the submissions of counsel for the Director that, upon the proper construction of the Act, the Order, and the Rules, applicants were required to comply with each of the matters and procedures set out in clause 6.2 of the Rules, regardless of their character, and that in the absence of full compliance, the Director was compelled, by the terms of clause 8.2.2 of the Rules, to refuse the application.

I agree with the submission of the Director that the task of statutory construction commences with the identification of the clear and unambiguous meaning of the text of the relevant instrument. In the current case:

(a)section 143A of the Act empowers the Minister to make Orders for the granting of taxi‑cab licences;
(b)the Order specifies that the class of persons eligible to apply for taxi‑cab licences are those who satisfy the eligibility requirements specified in rule 6.2 of the Rules, that the procedures to be followed for the granting of licensing are the procedures set out in Parts B to D of the Rules, and that each application must include a completed application form specified by the Director to be applicable to the application; and
(c)the Rules require that if an applicant does not meet the eligibility criteria, the Director must refuse the application, and again defines eligibility criteria to mean the criteria described in clause 6.2. Clause 7.1.3 of the Rules provides that applicants must complete all information as required in the applicable Application Form and must provide all documents and evidence requested in the Application Form.

The meaning of these provisions is clear and plain, and expressed in mandatory, rather than permissive language. Subject to one possible exception, which is discussed further below, neither the Order or the Rules appear to confer upon the Director any discretion to waive the need for applicants to strictly comply with the eligibility criteria.

I also agree that the fact that the Director chose to allow applicants who had submitted incomplete Certificates of Financial Capacity an opportunity to rectify deficiencies in this part of the application is not relevant to determining whether, as a matter of law, the Director was in fact empowered to do so.

I am satisfied that, properly construed, the language of clause 6.2 of the Rules there is no basis for distinguishing between “substantive eligibility criteria” and “procedural requirements”, and that by doing so, the Tribunal Member fell into error. The definition of “eligibility criteria” in clause 1.1 of the Rules is clear and unambiguous. In any event, upon close reading of the whole of clause 6.2, it is difficult to discern what matters could be considered to be substantive, and what matters are merely procedural in nature.

Clause 6.2 requires an applicant not only to fall within a certain class of person (or not fall within a certain class of persons, as the case may be), but to verify those matters, either by way of the provision of primary documents, verification by way of statutory declaration, or verification by way of independent certification (such as the requirement in clause 6.2.6 for an accountant’s certificate). Thus, under the proper reading of the Rules, Clause 6.2 not only requires that a person fall within a certain class of persons, but requires that person must verify that they are within a certain class of persons.

In any event, even if such a distinction were open, it is difficult to characterise the requirement to sign the statutory declaration and privacy consent as a mere matter of form.[9] The Consent and Statutory Declaration at Section L of the Application Form includes, among other things:
[9]See paragraph 75 of the reasons.

(a)a consent to the Director obtaining and using personal information (including sensitive information) for the purpose of considering, evaluating, processing and making a decision in respect of the application;
(b)consents to the exchange of information between the Director or his agents and Victoria Police and VicRoads for the purpose of checking criminal and other records;
(c)acknowledges certain matters regarding the terms and conditions upon which tax cab licences may be granted; and
(d)makes the following declaration:

“I, the Applicant/Responsible Person, declare that:
All information provided in this Application Form is true and correct and that this information is true and correct and that this declaration is made in the knowledge that a false declaration is liable to the penalties of perjury.”

By signing the Consent and Statutory Declaration, the Applicant is verifying the matters referred to in the preceding sections of the application form, including, but not limited to the following matters:

(a)the name and address of the applicant;
(b)that the applicant is an Australian resident;
(c)whether the applicant has been charged with, fined or convicted for any traffic offences or other criminal offences;
(d)whether the applicant had been accredited for or disqualified from being a taxi‑cab driver, operator or licence holder; and
(e)whether the applicant was an undischarged bankrupt, disqualified from managing a corporation, or had been found guilty of offences under the Corporations Act.

By failing to sign the Consent and Statutory Declaration, an applicant not only failed to verify the matters set out above, but also failed to empower the Director to make his own inquiries with respect to these matters. Even if the “substantive/procedural” distinction was open to the Tribunal Member (or for that matter, the Director), the failure to sign this form was not a trivial matter, particularly having regard to the matters sought to be verified.

The Tribunal Member relied upon Project Blue Sky[10] to support his finding that the criteria referred to in clauses 6.2.2 and 6.2.6 of the Rules cannot be and were not eligibility criteria, for the purpose of clause 8.2.2 of the Rules. However, adopting the approach of the High Court in Project Blue Sky, and reviewing clause 6.2 in the context of the Order and Rules as a whole, only bolsters my conclusion that unless an applicant complied with clause 6.2 in every respect, the Director was obliged to refuse Mr Ali’s application.
[10]See paragraph 19 above.

The Rules set out, in great detail and formality, the process by which the Director would conduct and manage the application and tender process for the new taxi‑cab licences. As previously indicated, the application process had three phases: the initial application process, the tender process, and the accreditation process. Each phase was governed by a number of rules. Part B of the Rules (the section applicable to this proceeding) governs the initial application process. Clause 8.2.1 provides that if an applicant meets the eligibility criteria the applicant will progress to the tender process. It is noteworthy that clause 7.1.3 provides that:

Applicants must complete all information as required in the applicable Application Form and must provide all documents and evidence requested in the application form.

The tender process is governed by Part C of the Rules, which provides for an elaborate process of evaluating and ranking the bids proffered by applicants for the different classes of taxi‑cab licences, and permits applicants to make single bids or multiple bids. Clause 13 of the Rules sets out the ranking and selection process. Again, the language of the Rules is prescriptive, and, subject to certain exceptions, appears to offer little scope to either the Director or an applicant to depart from the procedures and requirements of the Rules.

Once an applicant has become a Selected Bid, they progress to Phase 3, being the Accreditation Process, whereby the successful tenderers (at least in a financial sense) are required to satisfy the Director that they comply with the criteria necessary to become a holder of a taxi‑cab licence: that is, be accredited by the Victorian Taxi Directorate, and show evidence of ownership of a taxi-cab that complies with the relevant specifications. Again, Part D of the Rules is expressed in prescriptive and mandatory language, and contains only limited discretion to the Director to waive or vary the requirements of the Rules.

Accordingly, the mandatory nature of the requirements of Part B of the Rules is consistent with the overall nature of the scheme which establishes the process by which applicants were to apply for the new taxi-cab licences. This is not surprising given the evidence which was before the Tribunal that the Director was concerned to ensure the application, tendering, and licence allocation process was conducted with the utmost integrity, fairness and probity.[11] Arguably, if the Rules provided the Director with a degree of discretion regarding the compliance with either the Director’s or an applicant’s compliance with the Rules, that objective could be jeopardised.
[11]Witness statement of Tony Eric Hayward, paragraphs 7, 20, 22 and 24.

Also consistent with the strict construction of the Rules urged upon me by counsel for the Director are a number of specific clauses which do empower the Director to waive compliance with provisions of the Rules, or to extend the time for compliance with the Rules. For example, clause 13.2.3(a) of the Rules provides that the Director may allow a licence fee to be paid in instalments, clause 13.2.3(c) of the Rules allows the Director to return to the pool of unsuccessful tenderers if a successful tenderer fails to pay the initial instalment of the licence fee within a specified time, and clause 16.4 provides that the Director may extend the period of time for an applicant to comply with any of the requirements of Part D of the Rules (which governs the accreditation phase of the process). It is telling that no such provision is made in Part B of the Rules, which governs the application phase of the process.

There is one provision of the Rules from which one could infer that the Director has a residual discretion to vary or waive the requirements of the Rules. Clause 4.1.2 of the Rules states as follows:

The Licensing Authority may refuse the Application of any Applicant who fails to comply with any requirement of these Rules.

Arguably, the existence of such a provision could allow one to draw a conclusion that notwithstanding the mandatory language used throughout the Rules, it was ultimately at the discretion of the Director to determine whether the consequences of any breach would be the refusal of the application. As the appeal was undefended, I sought supplementary submissions from the Director as to whether the existence of this provision was inconsistent with the submissions made on behalf of the Director during the course of the hearing.

Upon review of the Director’s supplementary submissions, I am satisfied that the requirement in clause 8.2.2 of the Rules, which required the Director to refuse any application of an applicant who did not meet the Eligibility Criteria, prevailed over the general discretion conferred by clause 4.1.2 of the Rules, based upon the established principle of statutory construction that where there is a conflict between general and specific provisions, the specific provisions prevail. In addition to the matters referred to in the Director’s supplementary submissions, this conclusion is bolstered when one reviews clause 4.1.2 in its context. While clause 4.1.2 refers to “these Rules”, presumably meaning the Rules as a whole, the remainder of clause 4 of the Rules include provisions which prohibit applicants from

(a)seeking improper assistance from the Victorian Taxi Directorate,
(b)making any unlawful inducements in connection with an application,
(c)engaging in any activities which may be perceived as, or that may have the effect of improperly influencing the outcome of the application process,
(d)making any media release or other public statement, or
(e)engaging in any anti‑competitive conduct.

As no specific sanctions are identified with respect to conduct of this nature, it may well be the case that while clause 4.1.2 may confer a general discretion upon the Director with respect to non‑compliance with the Rules (insofar as they are not governed by specific provisions such as clause 8.2.2 and other similar provisions in the Rules),[12] this provision is also expressly intended to empower the Director to refuse the application of any applicant whose applications have otherwise complied with the requirements of the Rules, but have engaged in inappropriate conduct of the kind referred to in the other provisions of clause 4.
[12]See also clauses 13.3.3(b) and (d), clause 13.3.4(a) and 13.3.1.

Accordingly, by finding that the Director had the discretion to invite the respondent to correct deficiencies in his application form after the due date for the closure of applications (and was in fact by reasons of fairness required to do so) the Tribunal Member misconstrued the meaning of clause 6.2 and 8.2.2 of the Rules, thereby committing a vitiating error of law. This misconstruction was central to the Tribunal Member’s finding that the Director was in error by refusing to provide Mr Ali with an opportunity to rectify the error in his application. Accordingly, the first question of law posed by the Director ought to be answered in the affirmative.

Section 51(1) of the VCAT Act governs the powers and functions of VCAT exercising its review jurisdiction, as it was in this case, and states as follows:

In exercising its review jurisdiction in respect of a decision, the Tribunal –
(a) has all of the functions of the decision-maker; and
(b)has any other functions conferred on the Tribunal by or under the enabling enactment; and
(c)has any functions conferred on the Tribunal by or under this Act, the regulations, and the rules.

Counsel for the Director submitted that in exercising its review jurisdiction under s 31 of the VCAT Act, VCAT had no lesser or greater powers than the Director upon review. If the Director was not empowered to excuse Mr Ali’s non‑compliance with clause 6.2 of the Rules, then neither was VCAT. Accordingly, the Tribunal Member committed a vitiating error of law in respect of the second question of law posed by the Director.

Finally, this is not a case where I should exercise my discretion not to grant relief. The evidence filed on behalf of the Director in support of its application for leave to appeal[13] demonstrates that the approach taken by VCAT in relation to this matter and other similar matters has:
[13]Affidavit of Jennifer Lea Patterson sworn 19 April 2011, paragraphs 12-15.

(a)cast doubt upon what criteria and procedures the relevant Minister may determine must be satisfied for the granting of taxi‑cab licences;
(b)cast doubt upon the criteria and procedures to be used in government commercial tendering processes generally;
(c)signalled that there may be a requirement that for government entities conducting tendering processes to contact applicants or tenderers who make errors or omissions in their applications or bids; and
(d)signalled that the use of mandatory language in instruments may not have mandatory effect.

Further, applications for review before VCAT which raise precisely the same questions of law as this proceeding.

While strictly speaking these considerations are relevant to the question as to whether leave ought to be granted to bring the appeal, they are also relevant factors to be taken into account when determining whether to grant the relief sought by the Director.

Finally, I also agree with the Director that this is one of the instances whereby remittal of the proceeding would be futile, as the only lawful decision which VCAT could make would be to affirm the Director’s decision to refuse to grant Mr Ali’s application.

Accordingly, I will make orders in accordance with the relief sought by the Director.

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Department of Transport v Ali [2011] VSC 564

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Corporation of the City of Enfield v Development Assessment Commission [2000] HCA 5

[2011] VSC 564

10 November 2011