Granite Arms Pty Ltd v Chief Executive Officer of Customs
[2002] FCA 1048
•22 AUGUST 2002
FEDERAL COURT OF AUSTRALIA
Granite Arms Pty Ltd v Chief Executive Officer of Customs [2002] FCA 1048
ADMINISTRATIVE LAW – judicial review – strike-out application – distinction between seizure and decision to seize – proceedings in Victorian Magistrates Court initiated before proceedings in Federal Court – whether Federal Court proceedings are an abuse of process – applicability of s 10 Administrative Decisions (Judicial Review) Act 1977 (Cth) – applicability of O 20 r 2(1) Federal Court Rules – whether firearms are “special forfeited goods” – jurisdiction of Federal Court to stay proceedings where there are other proceedings between the same parties for the same cause of action in a different court – decisions reviewable by the Administrative Appeals Tribunal
WORDS & PHRASES – “special forfeited goods” – “seizure” – “decision to seize”
Federal Court Rules, O 20 r 2(1)
Administrative Decisions (Judicial Review) Act 1977 (Cth), ss 10, 6(1), 3(1)
Customs Act 1901 (Cth), ss 205D(2)(e), 229(1)(b), 183UA(1), 273GA
Customs (Prohibited Imports) Regulations 1956 (Cth), s 4F(1); Schedule 6, Part 2, Column 3; Schedule 6, Part 3; Schedule 6, Part 1, cl 4.1Second Life Décor Pty Ltd v Co v Comptroller-General of Customs (1994) 53 FCR 78, distinguished
Fencott v Muller (1983) 152 CLR 570, applied
Stack v Coast Securities [No. 9] Pty Ltd (1983) 154 CLR 261, applied
Sentry Corp v Peat Marwick Mitchell (1990) 24 FCR 463, followed
Convery v Ziino (1985) 70 ALR 383, cited
Oceanic Sun Line Shipping Co Inc v Fay (1988) 165 CLR 197, citedGRANITE ARMS PTY LTD (ACN 006 551 748) and OMEO WAY PTY LTD (ACN 050 415 355) v THE CHIEF EXECUTIVE OFFICER OF CUSTOMS and AUSTRALIAN CUSTOMS SERVICE
No Q 47 of 2002
SPENDER J
BRISBANE
22 AUGUST 2002
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
Q 47 OF 2002
BETWEEN:
GRANITE ARMS PTY LTD (ACN 006 551 748)
FIRST APPLICANTOMEO WAY PTY LTD (ACN 050 415 355)
SECOND APPLICANTAND:
THE CHIEF EXECUTIVE OFFICER OF CUSTOMS
FIRST RESPONDENTAUSTRALIAN CUSTOMS SERVICE
SECOND RESPONDENTJUDGE:
SPENDER J
DATE OF ORDER:
22 AUGUST 2002
WHERE MADE:
BRISBANE
THE COURT ORDERS THAT:
- The motion be dismissed.
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
Q 47 OF 2002
BETWEEN:
GRANITE ARMS PTY LTD (ACN 006 551 748)
FIRST APPLICANTOMEO WAY PTY LTD (ACN 050 415 355)
SECOND APPLICANTAND:
THE CHIEF EXECUTIVE OFFICER OF CUSTOMS
FIRST RESPONDENTAUSTRALIAN CUSTOMS SERVICE
SECOND RESPONDENT
JUDGE:
SPENDER J
DATE:
22 AUGUST 2002
PLACE:
BRISBANE
REASONS FOR JUDGMENT
This is a notice of motion filed on 15 May 2002 on behalf of the Chief Executive Officer of Customs (“the first respondent”) and the Australian Customs Service (“the second respondent”) seeking orders that:
“1.This proceeding be dismissed pursuant to Order 20 sub-rule 2(1) of the Federal Court Rules as an abuse of process of the Court.
2.Alternatively, this proceeding be dismissed pursuant to s.10 (2)(b)(ii) of the Administrative Decisions (Judicial Review) Act 1977.
3.The Applicants pay the Respondents’ costs of and incidental to this proceeding.
4.Such other orders as the Court deems fit.”
Order 20 sub-rule 2(1) of the Federal Court Rules provides:
“Where in any proceeding it appears to the Court that in relation to the proceeding generally or in relation to any claim for relief in the proceeding –
(a)no reasonable cause of action is disclosed;
(b)the proceeding is frivolous or vexatious; or
(c)the proceeding is an abuse of the process of the Court,
the Court may order that the proceeding be stayed or dismissed generally or in relation to any claim for relief in the proceeding.”
Section 10(2) of the Administrative Decisions (Judicial Review) Act 1977 (Cth) (“the ADJR Act”) relevantly provides:
“Notwithstanding subsection (1):
(a)…
(b)the Federal Court or the Federal Magistrates Court may, in its discretion, refuse to grant an application under section 5, 6 or 7 that was made to the court in respect of a decision, in respect of conduct engaged in for the purpose of making a decision, or in respect of a failure to make a decision, for the reason:
(i)…
(ii) that adequate provision is made by any law other than this Act under which the applicant is entitled to seek a review by the court, by another court, or by another tribunal, authority or person, of that decision, conduct or failure.”
The notice of motion has been argued on the basis of the amended application and statement of claim filed by Granite Arms Pty Ltd (“the first applicant”) and Omeo Way Pty Ltd (“the second applicant”) in these proceedings. The time for filing of the amended application and leave in respect of the amendments was granted at the hearing of the notice of motion. The amended application in the Federal Court proceedings seeks, amongst other relief, the following:
“…
3.A DECLARATION pursuant to s 16(1)(c) of the Administrative Decisions (Judicial Review) Act 1977 (Cth) that the seizure of certain firearms, being 2000 Chinese made Norinco M213 pistols or so many of the said pistols as had been certified as safe after testing by the Australian Federal Police (“the pistols”) by the First and/or Second Respondent on or about 8 May 2000 or 7 September 2001 was unlawful and, in particular, contrary to the provisions of the Customs Act 1901 (Cth).
4.AN ORDER pursuant to s 16(1)(a) of the Administrative Decisions (Judicial Review) Act 1977 (Cth) quashing the decision made by the First and/or Second Respondent to seize the said pistols on or about 8 May 2000 or 7 September 2001.
5.AN ORDER pursuant to s 16(2)(b) requiring the First Respondent and/or the Second Respondent to return the said pistols to the First Applicant and/or the Second Applicant.
6.Delivery up of the said pistols or of those pistols of the 2000 seized that have been passed as safe by the Australian Federal Police.
7.Damages for wrongful detinue or conversion.
…”
It should be noted that there is an important distinction, which may have to be addressed by further amendment, between seizure and a decision to seize. While seizure is undoubtedly conduct, the review of conduct under the ADJR Act is restricted by the terms of s 6(1) of that Act which commences:
“Where a person has engaged, is engaging, or proposes to engage, in conduct for the purpose of making a decision to which this Act applies, a person who is aggrieved by the conduct may apply to the Federal Court or the Federal Magistrates Court for an order of review in respect of the conduct on any one or more of the following grounds:
…”The short point is that the seizure is not “conduct for the purpose of making a decision to which this Act applies”, and it is therefore not conduct reviewable pursuant to the ADJR Act. The act of seizure is preceded by a decision to seize, and s 3(1) of the ADJR Act relevantly provides that a “decision to which this Act applies” means:
“a decision of an administrative character made, proposed to be made, or required to be made (whether in the exercise of a discretion or not and whether before or after the commencement of this definition):
(a)under an enactment referred to in paragraph (a), (b), (c) or (d) of the definition of enactment; or
(b)by a Commonwealth authority or an officer of the Commonwealth under an enactment referred to in paragraph (ca) or (cb) of the definition of enactment;”
The basis of the notice of motion seeking the dismissal of the Federal Court proceedings or, pursuant to the claim for “such other orders as the Court deems fit”, a stay of the Federal Court proceedings, is based on the circumstance that there is, in the Magistrates Court of Victoria, an application by the first respondent under s 205D(2)(e) of the Customs Act 1901 (Cth) (“the Customs Act”) which seeks the following relief:
“1.A declaration that 2000 Norinco M213 pistols (“the guns”) imported on or about 3 May 2000 and seized by Customs in two lots (396 pistols and 1604 pistols) on 7 September 2001 under section 203B(2) of the Customs Act 1901 (“the Act”) be declared to be special forfeited goods.
2.A declaration that the Form B709A dated 12 April 2000 issued by or on behalf of the Chief Commissioner of the Victoria Police in respect of the guns was void and/or of no legal effect.
3.An order that the guns be condemned as forfeited to the Crown.
4.Such other orders as the Court deems fit.”
It is submitted on behalf of the respondents that the commencement of the Federal Court proceedings after the application in the Victorian Magistrates Court is an abuse of process within O 20 r 2(1) of the Federal Court Rules and warrants dismissal of the Federal Court proceedings or, alternatively, the Magistrate Court proceedings brought by the first respondent such as to fall within s 10(2)(b) of the ADJR Act. It is submitted that those proceedings make adequate provision by which the applicants are entitled to seek a review by another court of the decision or conduct or failure sought to be challenged in the Federal Court proceedings.
There are at least two matters which ought to be noted at this time concerning s 10 of the ADJR Act. The first is that s 10(2)(b) of the ADJR Act does not provide a basis to strike out proceedings, but confers a discretion to refuse to grant an application made under ss 5, 6 or 7. It does not provide a basis for staying the Federal Court proceedings. The second point is that subs 10(3) provides:
“In this section, review includes a review by way of reconsideration, re-hearing, appeal, the grant of an injunction or of a prerogative or statutory writ or the making of a declaratory or other order.”
Under the Customs Act, s 203B provides authority for an authorised person to search without warrant and seize any goods that the authorised person reasonably suspects are “special forfeited goods”. Section 205D(2) of the Customs Act provides:
“The authorised person who seized the goods must, subject to any law of the Commonwealth, a State or a Territory permitting their retention, destruction or disposal, return the goods unless:
…(e)if the goods were seized as special forfeited goods – not later than 120 days after the claim for their return is made, proceedings before a court of summary jurisdiction for a declaration that the goods are special forfeited goods have been commenced and, on completion of the proceedings, a court has made an order for condemnation of the goods as forfeited to the Crown.”
The submission on behalf of the respondents is that, a claim for return of the firearms in question having been made in the present circumstances, the Magistrates Court proceedings will determine whether the goods are “special forfeited goods”. If the firearms are not “special forfeited goods” there will not be an order for condemnation of the goods as forfeited to the Crown, and Customs is therefore obliged in those circumstances to return the goods pursuant to s 205D. This, it is submitted, is a provision of the Customs Act which is adequate to review the decision to seize the firearms.
I do not think s 10(3) of the ADJR Act should be read narrowly, but in my opinion the forfeiture proceedings initiated by the first respondent are not an instance of a provision made by a law under which the applicants are entitled to seek review by another court of the decision to seize. The forfeiture proceedings in the Magistrates Court clearly involve the question of whether the goods are or are not “special forfeited goods”, but they do not in my view make provision by which the applicants are entitled to seek review by another court of the decision to seize the firearms in question.
In my judgment, s 10 of the ADJR Act provides no basis for dismissing or staying the Federal Court proceedings.
I turn now to consider whether the proceedings should be dismissed (or stayed) in reliance on O 20 r 2(1) of the Federal Court Rules. It is submitted on behalf of the respondents that the seizure of the firearms in two lots was authorised by s 203B(2) of the Customs Act as being goods suspected on reasonable grounds to be “special forfeited goods”. “Special forfeited goods” include all prohibited imports: subs 183UA(1) and 229(1)(b) of the Customs Act. It is submitted by counsel for the respondents that one lot comprising some 1604 pistols were seized as prohibited imports because they did not meet the police authorisation test requirement: Customs (Prohibited Imports) Regulations 1956 (Cth) (“the Regulations”) s 4F(1); Schedule 6, Part 2, Column 3. The second lot comprising 396 pistols were said to be seized as prohibited imports on that ground, and on the additional ground of non-compliance with a safety requirement set out in Schedule 6, Part 3 of the Regulations.
It is not clear to me the basis for the contention by the first respondent in the Magistrates Court proceedings that the licence in Form B709A by the Victorian Police to the first applicant was secured by deceit, with the consequence that the form is void and/or of no legal effect. It may be that if in fact the first applicant was not the importer of the goods, the requirement under cl 4.1 of Schedule 6, Part 1 of the Regulations for a police authorisation test certificate satisfying that regulation has not been complied with. The contention by Mr Gutterson QC on behalf of the respondents on the abuse of process point is that the issue of whether or not the goods were “special forfeited goods” is the primary issue in the Magistrates Court proceedings, and the jurisdiction to determine that issue, is in the particular “remit” to that court under s 205D(2)(e) of the Customs Act. It is submitted on behalf of the respondents that that issue will be determinative of the Federal Court proceedings.
While there is some force in this submission in respect of the issue of whether the goods are “special forfeited goods”, there are other issues, including allegations of bad faith and want of reasonable suspicion, which might permit success, notwithstanding failure on the central issue in contention; that is, whether the goods are or are not “special forfeited goods”.
The present case can be distinguished from Second Life Décor Pty Ltd v Comptroller-General of Customs (1994) 53 FCR 78. Heerey J held that the Federal Court proceedings in that case constituted an abuse of process:
“… because it is brought as a means of obtaining some advantage for which such proceedings are not designed or some collateral advantage beyond what the law offers: Williams v Spautz (1992) 174 CLR 509 …”
His Honour said at 85:
“The second and third respondents are officers of the Commonwealth and the lawfulness of their conduct as such is subject to supervision and control by the Federal Court by way of mandamus, prohibition or injunction under s 75(v) of the Constitution and s 39B of the Judiciary Act. If SLD sought such relief in respect of alleged unlawful seizure and detention of its property, the Federal Court would have ample jurisdiction. The return of the property and/or damages for its detention could be sought by common law claims for conversion and detinue founded in the pendant jurisdiction of the Court: Fencott v Muller (1983) 152 CLR 570. Similar relief could have been obtained under the Administrative Decisions (Judicial Review) Act 1977 (Cth), see especially ss 5(1)(d), (e), (f), 6(1)(d), (e), (f), 16(1)(d).
However the present proceeding is on its face not directed to legitimate ends such as these. SLD’s application does not seek return of its property, or damages. SLD is seeking to have the Federal Court control the admission of evidence in proceedings in the County Court of Victoria. Its application goes to the extent of seeking an injunction ‘forever restraining’ the Comptroller-General from maintaining the County Court proceedings – irrespective of whatever other evidence might be available. …”
In the Federal Court proceedings in the present case, the applicants claim damages for detinue and/or conversion. It is not clear whether such a claim might be able to be brought by cross-claim in the forfeiture proceedings in the Victorian Magistrates Court. Even if such proceedings could be brought, it is by no means clear whether the quantum of those claims is within the jurisdictional limit of the Victorian Magistrates Court.
If there are any inhibitions on the capacity of the Victorian Magistrates Court to deal with the common law claims, a matter which is not presently clear, then the proceedings in the Federal Court would enjoy the advantage of being able to resolve not only the primary relief sought in the ADJR application, but also the associated common law claims: see Fencott v Muller (1983) 152 CLR 570 and Stack v Coast Securities [No. 9] Pty Ltd (1983) 154 CLR 261.
It is clear that the Federal Court has undoubted jurisdiction to stay proceedings before the Federal Court where there are other proceedings between the same parties for the same cause of action in a different court. As Lockhart J noted in Sentry Corp v Peat Marwick Mitchell & Co (1990) 24 FCR 463 at 488:
“The jurisdiction must be exercised with great care and extreme caution: Oceanic Sun Line Shipping Co Inc v Fay (1988) 165 CLR 197, per Deane J (at 243-4) and ‘The grounds on which the court is justified in refusing to exercise its jurisdiction when it is regularly invoked are, and in my opinion, should be, grave and narrowly confined’: Oceanic Sun Line, per Brennan J (at 233).”
Lockhart J said at 489:
“The pendency of two actions between the same parties for the same cause of action in two jurisdictions is not by itself sufficient to warrant the grant of a stay; the defendant must establish that it is vexatious and oppressive to continue the proceeding in the forum: McHenry v Lewis (1882) 22 Ch D 397, per Bowen LJ (at 408).
The burden of proving that it is vexatious lies upon the defendant: Hyman v Helm (1883) 24 Ch D 531 at 537, 544; Oceanic Sun Line, per Deane J (at 248).
The defendant must show that the continuation of the proceeding in the forum is vexatious or oppressive or for other reasons involves an essential element of injustice (Oceanic Sun Line, per Deane J (at 245)) or an abuse of process (Oceanic Sun Line, per Brennan J (at 233-4)). See also McHenry, per Jessel MR (at 399-400), per Cotton LJ (at 405-407), and Bowen LJ (at 408-409); Peruvian Guano Co v Bockwoldt (1883) 23 Ch D 225 (at 233); Slough Estates Ltd v Slough Borough Council [1968] Ch D 299, per Ungoed-Thomas J (at 318-320); National Mutual Holdings Pty Ltd v Sentry Corp (1989) 87 ALR 539, per Gummow J (at 561-563).”
Decisions to seize pursuant to s 203B of the Customs Act are not decisions which can be reviewed by the Administrative Appeals Tribunal: s 273GA of the Customs Act. Convery v Ziino (1985) 70 ALR 383 was an application where a respondent on the motion sought to have proceedings dismissed pursuant to s 10(2)(b)(ii) of the ADJR Act, and further sought that an appointed hearing date be stayed pending the disposal of certain criminal proceedings. Neaves J held that the onus was on the moving party to persuade the Court that it should not exercise its jurisdiction under the ADJR Act.
In Sentry Corp at 473, Sweeney J referred to the observations of Brennan J in Oceanic Sun Line Shipping Co Inc v Fay (1988) 165 CLR 197, who made it clear (at 238) that a court:
“… should not stop a proceeding which has been regularly commenced in the courts in Australia merely because there is a similar action being brought in a foreign Court unless the invocation of the jurisdiction in the Australian Court is oppressive, vexatious or otherwise an abuse of process and that a very strict and narrow meaning must be given to those words ‘oppressive, vexatious or otherwise an abuse of process’.”
While the question of whether the weapons are or are not in fact “special forfeited goods” is the primary question in the proceedings in the Magistrates Court, those proceedings do not involve any resolution of the legality of the seizure itself, which is a different question and which may involve further factors.
Consistent with the authorities, I do not think this is a case where the Court should exercise its discretion to decline to hear the application for judicial review. No suggestion of hardship is advanced by counsel for the respondents if the proceedings under the ADJR Act continue. While there is an obvious overlap of some questions, and important questions as well, the issues are not co-terminous. I am not persuaded that there is any abuse of process in the applicants seeking relief pursuant to the ADJR Act in the Federal Court.
I will hear the parties on costs.
I certify that the preceding twenty-five (25) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Spender. Associate:
Dated: 22 August 2002
Counsel for the Applicants: Mr S. Zillman, with Mr M. Taylor Solicitor for the Applicants: Roberts and Kuskie Counsel for the Respondents: Mr R. Gutterson, QC, with Mr E. Howell Solicitor for the Respondents: Australian Government Solicitor Date of Hearing: 20 August 2002 Date of Judgment: 22 August 2002
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