Giorgas, A v Federal Airport Corporation
[1995] FCA 380
•9 JUNE 1995
CATCHWORDS
JUDICIAL REVIEW - Administrative decision - objection to competency - whether decision of respondent not to accept applicants' tender proposal was a decision of an administrative character made under an enactment within the meaning of s.3(1) of the Administrative Decisions (Judicial Review) Act 1977 (Cth) - conduct challenged of a commercial nature occurring in a commercial context leading to the making of contracts.
Administrative Decisions (Judicial Review) Act 1977 (Cth) s.3(1)
Federal Airports Corporation Act 1986 (Cth) ss. 5 and 6
General Newspapers Pty. Ltd. v. Telstra Corporation (1993) 45 FCR 164 - Foll.
Australian Capital Territory Health Authority v. Berkeley Cleaning Group Pty. Ltd. (1985) 7 FCR 575 - Not Foll.
James Richardson Corporation Pty. Ltd. v. Federal Airports Corporation (1992) 117 ALR 227 - Not Foll.
CEA Technologies Pty. Ltd. v. Civil Aviation Authority (1994) 122 ALR 724
Chapmans Ltd. v. Australian Stock Exchange Ltd. (1994) 12 ACLC 512
Hutchins v. Deputy Commissioner of Taxation (1994) 123 ALR 133
Antonios Giorgas and Gary William Grant as Trustees for the Airport Unit Trust and Stuart De La Zilwa Trading as Airport News Supplies v. Federal Airport Corporation
No. QG30 of 1995
Cooper J., Brisbane, 9 June, 1995
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
No. QG30 of 1995
BETWEEN:
ANTONIOS GIORGAS AND GARY WILLIAM GRANT
AS TRUSTEES FOR THE AIRPORT UNIT TRUST
AND STUART DE LA ZILWA TRADING AS AIRPORT
NEWS SUPPLIES
Applicants
AND:
FEDERAL AIRPORTS CORPORATION
Respondent
JUDGE MAKING ORDER:Cooper J.
WHERE MADE: Brisbane
DATE OF ORDER: 9 June, 1995
MINUTES OF ORDER
THE COURT ORDERS THAT:
1. The objection to competency notice filed on 15 March, 1995 is upheld.
2. The proceedings, including the notice of motion filed 1 March, 1995 be dismissed.
3. The applicants pay the respondent's costs of and incidental to the proceedings, including reserved costs if any and the costs of and incidental to the applicants' notice of motion filed 1 March, 1995 to be taxed if not agreed.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
No. QG30 of 1995
BETWEEN:
ANTONIOS GIORGAS AND GARY WILLIAM GRANT
AS TRUSTEES FOR THE AIRPORT UNIT TRUST
AND STUART DE LA ZILWA TRADING AS AIRPORT
NEWS SUPPLIES
Applicants
AND:
FEDERAL AIRPORTS CORPORATION
Respondent
CORAM: Cooper J.
PLACE: Brisbane
DATE: 9 June, 1995
REASONS FOR JUDGMENT
The applicants carry on a newsagency business under the style or firm name of "Airport News Supplies" at Racecourse Road, Ascot, Brisbane. Within the geographical area serviced by the newsagency is the Brisbane Airport.
The respondent is incorporated under section 5 of the Federal Airports Corporation Act 1986. Its functions are set out in section 6 of the Act and include the establishment of airports at Federal airport development sites and the operation of Federal airports. In the fulfilment of that function the respondent is constructing and once completed will operate a new international passenger terminal at Brisbane Airport. The land upon which the new terminal is being constructed is vested in the respondent so that the legal title to the land and improvements (terminal and facilities) will vest in the respondent as owner.
In July, 1994 the respondent placed newspaper advertisements seeking registration of expressions of interest in speciality retail concessions at the new international terminal at Brisbane Airport. The advertisement said, in part :-
"Experienced specialist retailers are invited to register their interest to submit commercial proposals to operate innovative quality retail concepts from speciality retail concessions ranging from 40 - 180 square metres (average size 90 square metres) at the New Terminal Complex, Brisbane Airport.
The types of retail operations (single brand or multiple line stores) to be considered, will include but are not limited to:
· News/Books/Gifts
· Opals/Jewellery
· Souvenirs/Australiana Products
· Aboriginal Artefacts
· Fashion Cosmetics/Body Products
· Fashion Clothing
· Confectionary
· General Store/Chemist
· Money Exchange
With the registration of interest registrants must confirm in writing and provide evidence of their ability to satisfy the following pre-qualification criteria:
· Current annual sales in excess of $500,000.
· Experience in the operation of similar businesses.
· Sound commercial background and capacity to operate the proposed business.
· Financial strength.
· Development and ongoing management of professional business and marketing plans.
· Demonstrated ability to design and develop a superior level of fitout consistent with market demand.
Following registrations the FAC shall assess and shortlist applicants based on the above criteria. `Invitations for Proposals' will then be issued to the shortlisted applicants."
In response to the advertisement the applicants lodged a Registration of Expression of Interest for the "News/Books/Gifts" concession. On 24 September, 1994
the applicants received a document from the respondent described as "Speciality Retail Concessions - Request for Proposal". The document in Appendix C, entitled in part "Discretionary Retail Concessions" and "outline merchandising mix", made provision for a tenancy number "T4.10 News and books (including business lounge and postal facilities)" having an area of 196 square metres and tenancy number "T3.15 News and gifts (including fashion accessories)" having an area of 195 square metres.
The applicants lodged a proposal on 24 October, 1994. The proposal was for a newsagency to be conducted in tenancy number T4.10 and tenancy number T3.15. However, the applicants recommended that the two newsagency operations be moved to other tenancy locations than those identified in the respondent's documentation.
On 1 December, 1994 the applicants, together with QBD Bookshop, lodged a supplementary proposal for joint tenancies for tenancy T4.10 "News-Books-Gifts-Business Lounge" and for tenancy T3.15 "News-Gifts (including fashion accessories)".
On 2 December, 1994 a meeting was held between representatives of the applicants and the respondent wherein the proposal was discussed. The applicants were given at that meeting two letters dated 23 November, 1994 advising that they had been "short listed" and advising that those on the short list would be interviewed. There is a dispute between the parties as to whether or not the applicants were advised that they would be further interviewed.
On 24 January, 1995 the respondent wrote to the applicants and to their consultant Mr. Curtis. Each letter stated as follows :-
" Re: New Terminal Complex - Brisbane Airport
Speciality Retail Concessions
We are writing to advise you that your proposal has been unsuccessful and to thank you for your interest and participation.
The process of evaluating the proposals is now complete with a series of interviews being conducted with the parties considered to be the most suitable by FAC's Assessment Committee.
The quality and quantity of proposals outweighed our expectations, and we believe this will result in Brisbane gaining the facilities in its International Terminal which are comparable with world-class standards.
Yours faithfully
..."
On 1 March, 1995 the applicants filed an application for an order of review under the Administrative Decisions (Judicial Review) Act 1977 (Cth) ("the ADJR Act"). The application was "to review the decision of the Respondent dated the 24th of January, 1995 that the proposal of the Applicants made to the Respondent to operate two tenancies for newsagent/bookstore and news and gifts in the new terminal complex at Brisbane International Airport was unsuccessful." Central to the applicants' grounds for the application of review was the contention that under the Newsagency Council of Queensland Rules the applicants had a monopoly right to supply newspapers and other publications either itself or through sub-agents in the geographical area which includes the new terminal complex. The contention is that having regard to those rights the respondent could not accept the proposal of any other proponent which involved the sale of newspapers and kindred publications and was obliged to accept the proposal of the applicants.
On 1 March, 1995 the applicants also filed a notice of motion seeking an extension of time for the filing of the application to review the decision of 24 January, 1995 and seeking a suspension of the decision and a stay of any further proceedings under the decision.
On 15 March, 1995 the respondent filed an objection to competency on the grounds that :-
"1. The decision is not a decision to which the Act applies.
2. The application was not lodged with the Registry within the period prescribed by section 11 of the Act."
The respondent contends that the decision identified in the application is not a decision of an administrative character made under an enactment within the meaning of section 3(1) of the ADJR Act. The respondent contends that the conduct which is challenged is conduct of a commercial nature occurring in a commercial context leading to the making of contracts. As such it is submitted I am bound by the decision of a Full Court of this court (Davies, Gummow and Einfeld JJ.) in General Newspapers Pty. Ltd. v. Telstra Corporation (1993) 45 FCR 164 at 172-173 to hold that the decision is not a decision of an administrative character and that the application is incompetent.
The applicants submit that the decision in General Newspapers is either distinguishable or decided per incuriam and that I ought to give effect to the decision of a differently constituted Full Court (Fox, McGregor and Spender JJ.) in Australian Capital Territory Health Authority v. Berkeley Cleaning Group Pty. Ltd. (1985) 7 FCR 575 and my earlier decision in James Richardson Corporation Pty. Ltd. v. Federal Airports Corporation (1992) 117 ALR 227 where I followed the Berkeley Cleaning decision.
In General Newspapers, Davies and Einfeld JJ., with whom Gummow J. agreed on this point, said (at 172-173) :-
"The ADJR Act is thus concerned with decisions which, being authorised or required by an enactment, are given force or effect by the enactment or by a principle of law applicable to the enactment. Issues concerning the relevant factors to be taken into account, irrelevant factors which should not be taken into account, improper purposes, and the law to be applied will be matters to be decided having regard to the provisions of the enactment under which the decision is made, and the object and purposes of that enactment.
This principle was implicit in the decision of a Full Court of this Court (Bowen CJ, Lockhart and Sheppard JJ) in Australian National University v Burns (1982) 64 FLR 166, where their Honours held that the termination of a contract of employment between the Australian National University and a professor was a matter arising under the contract between them and did not arise under the Australian National University Act 1946 (Cth). After mentioning that s 23 of the University Act conferred the widest powers upon the University, including the power of appointing professors and other university staff, Bowen CJ and Lockhart J said (at 174):
`In our opinion the rights and duties of the parties to the contract of engagement were derived under the contract and not under the University Act. Section 23 empowered the Council to enter into the contract on behalf of the appellant. Even if the Council, in considering the position of the appellant under the contract, might be said to be acting under s 23, the effective decision for dismissal taken and notified to the respondent was directly under the contract.'
That decision has since been applied on many occasions and remains a strong authority on the point. See, for example, Sellars v Woods (1982) 69 FLR 105; Bayley v Osborne (1984) 4 FCR 141; Australian Film Commission v Mabey (1985) 6 FCR 107; Post Office Agents Association Ltd v Australian Postal Commission (1988) 84 ALR 563.
There are two authorities which may point to the contrary, Australian Capital Territory Health Authority v Berkeley Cleaning Group Pty Ltd (1985) 7 FCR 575 and James Richardson Corporation Pty Ltd v Federal Airports Corporation (1992) 117 ALR 277. In our opinion, these authorities should not be followed in preference to Australian National
University v Burns. In the Berkeley Cleaning case, Fox, McGregor and Spender JJ referred at 577 to s 3(2) of the ADJR Act par (g) of which `speaks generally of "act or thing"'. Their Honours went on to say that the making of a contract necessarily inferred a decision to make it and that in that case both the contract and the decision were made under an enactment, the Health Services Act 1985 (ACT). In the James Richardson case, Cooper J followed Berkeley Cleaning. Neither of those cases gave to the term `decision' the meaning which, in our view, it carries, namely that of an ultimate or operative determination which has force and effect by virtue of an enactment. A contract entered into by a corporation under a general power to enter into contracts is not given force and effect by the empowering statute. The empowering statute merely confers capacity to contract, whilst the validity and effect of the contract is determined by the ordinary laws of contract."
The decision in General Newspapers in respect of decisions made in the tendering process has been applied by Neaves J. in CEA Technologies Pty. Ltd. v. Civil Aviation Authority (1994) 122 ALR 724 at 725, 730-731. The Full Court decision has also been applied in the decisions in Chapmans Ltd. v. Australian Stock Exchange Ltd. (1994) 12 ACLC 512 at 519 (Beaumont J.) and Hutchins v. Deputy Commissioner of Taxation (1994) 123 ALR 133 at 138-139 (Jenkinson J.).
In the face of a later Full Court decision expressly disapproving of an earlier Full Court decision and its application in my decision in Richardson, I am bound to give effect to the decision in General Newspapers, unless the applicants can demonstrate that it has no relevant application to the facts of this case.
The applicants submit that the General Newspapers decision is distinguishable on two bases :-
(a) The applicants were invited to put a proposal to the respondent whereas in General Newspapers no tenders were called.
(b) The matter in issue in the present case is not the capacity of the respondent to contract "but rather the capacity to deny the validity of the applicants' rights as the authorised newsagents for this zone under the system".
In my opinion the first ground of distinction is not a valid or material distinction. In General Newspapers their Honours said (at 173) :-
"In the present case, the decisions relied upon involved the entry of contracts and the conduct challenged was conduct leading to the making of the contracts. No statute made specific provision for such contracts, merely conferring upon Telecom all the powers of a natural person including the power to enter into a contract. That was a mere conferral of capacity to act. The contracts were not relevantly authorised or required by and were not made under an enactment. The validity of the contracts and of the acts done was governed entirely by the law of contract, not by the statutes. Thus, the ADJR Act had no application to the conduct or to the alleged decisions."
The decision complained of in the instant case was the rejection of the applicants as potential lessees to operate two concessions at the new terminal in favour of another applicants for the concessions. It was a step or "conduct leading to the making of the contracts". How the process leading to the making of contracts was initiated is irrelevant, in my view, to the ratio of General Newspapers. Although the point does not appear to have been taken before Neaves J in CEA Technologies, in that case the relevant conduct was initiated by invitations to eight companies to submit tenders (122 ALR at 725). The method by which the tendering process was initiated was irrelevant to the conclusion of Neaves J. that the decision to award the contract to a particular tenderer was not an administrative decision within the meaning of the ADJR Act.
The second basis of distinction seeks to divorce the decision of the respondent from the processes leading to the making of a contract. In order to do this it is sought to characterise the decision as one to abrogate rights vested in the applicants which the respondent was obliged to give effect to.
In my opinion the attempted distinction fails for two reasons. Firstly, the distinction is one of semantics only. Secondly, the underlying assumption that the applicants had vested rights which the respondent was obliged to give effect to is wrong in law.
The Newsagency Council of Queensland is a private organisation of publishers in Queensland. In order for an orderly distribution of newspapers and other publications to occur, and to ensure for the delivery and availability of those publications, the State has been divided up into various geographical zones and monopoly rights given to specific newsagents to carry on the business of newsagent in the area. The system is enforced by a refusal of the publishers to supply other than accredited newsagents. The whole scheme is administered by the Council in accordance with a set of detailed "Rules". The arrangements are in restraint of trade and only lawfully operate because of an authorisation obtained from the Trade Practices Commission under section 88 of the Trade Practices Act 1974.
The rights of the Council members inter se, and those newsagents who enter into agreements with the Council and agree to be bound by the rules, are private rights arising under the law of contract and enforceable under that law. The rights are neither public law rights nor private rights granted by statute. The respondent is not a
party to any agreement with the Council and is not bound by the Rules. Further, in the absence of some right granted by the respondent to the applicants to do so, for example a lease or licence, the applicants have no right to go onto the respondent's land and conduct a business. Whether and to whom the respondent grants that right is a matter totally within the power of the respondent.
The process of the respondent was to obtain expressions of interest for concessions in the terminal and then if it chose to do so by contractual arrangements to grant the concessions. Relevantly, the two tenancies were not limited to conducting newsagencies. Each was considerably wider. The supply of newspapers and other publications of the type dealt with by the Council Rules was but one part of the business operations of the concessions. The applicants cannot assert any "rights" for a wider category of stock items than those covered by the Rules.
The material makes clear that it was a matter of indifference to the respondent from which source any successful proponent obtained the stock, including newspapers, to be sold in the concessions. What is of relevance to the respondent is that its preferred concessionaire Collins Booksellers Pty. Ltd., will be able to supply newspapers and kindred publications. This appears from an affidavit of Mr. Michael Zifcak, the Executive Chairman of Collins Booksellers Pty. Ltd., who deposed :-
"I understand that the applicants are seeking an order staying the decision of the respondent not to grant leases to the applicants for news/books/gifts tenancies at the New Brisbane International Terminal Complex. The respondent (`FAC') has agreed to grant leases to Collins, subject to Collins obtaining all relevant authorisations."
It also appears from a letter from the solicitors for the respondent to the applicants' solicitors wherein it is stated :-
"We are instructed that our client is finalising lease negotiations with a news and books and news and gifts operator who will be required to obtain the approval of all relevant authorities and act in accordance with the Newsagency Council of Queensland Rules (if applicable)."
Being of the view that neither basis of distinction takes the case outside the operation of the decision in General Newspapers, I find that the decision of the respondent of 24 January, 1995 complained of in the within proceedings is not a decision of an administrative charter to which the ADJR Act applies. The objection to competency is upheld and the proceedings dismissed with costs.
THE COURT ORDERS THAT:
1. The objection to competency notice filed on 15 March, 1995 is upheld.
2. The proceedings, including the notice of motion filed 1 March, 1995 be dismissed.
3. The applicants pay the respondent's costs of and incidental to the proceedings, including reserved costs if any and the costs of and incidental to the applicants' notice of motion filed 1 March, 1995 to be taxed if not agreed.
I certify that this and the preceding ten (10) pages are a true copy of the reasons for judgment herein of his Honour Justice Cooper.
Date: 9 June, 1995
Associate
Counsel for the Applicants: Mr. N. Samios
Solicitors for the Applicants: Cranston McEachern
Counsel for the Respondent: Mr. G.A. Thompson
Solicitors for the Respondent: Mallesons Stephens Jaques
Date of Hearing: 30 March, 1995
Place of Hearing: Brisbane
Date of Judgment: 9 June, 1995
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