Imaging Applications Pty Ltd v Australian Securities and Investments Commission

[1999] FCA 1603

FEDERAL COURT OF AUSTRALIA

Imaging Applications Pty Ltd v Australian Securities & Investments Commission [1999] FCA 1603

ADMINISTRATIVE LAW – judicial review – challenge to decision by Australian Securities and Investment Commission declining to take over proceedings instituted by appellants in Supreme Court of Victoria – Insurance Contracts Act 1984 (Cth) s 55A – concession that decision made without authority – objection to competency – whether appellants entitled to directions as to manner in which decision to be made when considered afresh

Insurance Contracts Act 1984 (Cth) s 55A
Australian Securities and Investments Commission Act 1989 (Cth) s 7, 8, 9, 12A and 102

Din v Minister for Immigration and Multicultural Affairs (1997) 147 ALR 673 – cited
Ozmanian v Minister for Immigration, Local Government and Ethnic Affairs (1996) 137 ALR 103 - cited

IMAGING APPLICATIONS PTY LTD AND ANOR v AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION

V 232 OF 1999

JUDGES:      MERKEL, WEINBERG AND KENNY JJ
DATE:           17 NOVEMBER 1999
PLACE:         MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 232 OF 1999

ON APPEAL FROM A SINGLE JUDGE

BETWEEN:

IMAGING APPLICATIONS PTY LTD
ACN 006 376 441
First Appellant

MICHAEL IAN PETCH
Second Appellant

AND:

AUSTRALIAN SECURITIES & INVESTMENTS COMMISSION
Respondent

JUDGES:

MERKEL, WEINBERG AND KENNY JJ

DATE OF ORDER:

17 NOVEMBER 1999

WHERE MADE:

MELBOURNE

The Court orders that the appeal 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
VICTORIA DISTRICT REGISTRY	V 232 OF 1999

ON APPEAL FROM A SINGLE JUDGE

BETWEEN:

IMAGING APPLICATIONS PTY LTD
ACN 006 376 441
First Appellant

MICHAEL IAN PETCH
Second Appellant

AND:

AUSTRALIAN SECURITIES & INVESTMENTS COMMISSION
Respondent

JUDGES:

MERKEL, WEINBERG AND KENNY JJ

DATE:

17 NOVEMBER 1999

PLACE:

MELBOURNE

REASONS FOR JUDGMENT

THE COURT:

1. This is an appeal from a judgment of the learned primary Judge (Goldberg J) who on 23 June 1999 dismissed an application for an order of review filed by the appellants on 12 May 1999. For the purposes of the appeal the relevant facts may be briefly summarised as follows. The appellants made application to the respondent (“ASIC”) to exercise its power under s 55A of the Insurance Contracts Act 1984 (Cth) to take over certain proceedings which had been instituted by the appellants in the Supreme Court of Victoria. By letter dated 14 April 1999 ASIC, over the signature of Mr Jim Grayson, a senior enforcement lawyer, notified the appellants that ASIC had determined that it was not appropriate for it to take over the proceedings pursuant to s 55A.

2. On 12 May 1999, the appellants commenced their application for an order to review that decision pursuant to s 5 of the Administrative Decisions (Judicial Review) Act 1977 (Cth). The grounds of review relied upon relate essentially to errors of law. The relief sought in the application was an order quashing the decision of ASIC with directions that the matter be remitted to ASIC to be determined in accordance with law. The claim for relief stated that further particulars of the directions that would be sought on points of law would be supplied.

3. Shortly prior to the application for review coming on for a directions hearing before the primary judge, Mr Grayson discovered that he did not have a delegation under the Australian Securities and Investments Commission Act 1989 (Cth) (“the ASIC Act”) to exercise the functions and powers conferred upon ASIC under s 55A of the Insurance Contracts Act.

4. Mr Grayson corresponded with the appellants stating, in substance, that the decision he had made was not valid.  In particular, by letter dated 10 June 1999, ASIC informed the appellants that:

   “It has now come to my attention that I did not have the necessary delegation from ASIC to make a decision in respect of section 55A of the Act at, or at any relevant time before, 14 April 1999.  As a result ASIC has not made a decision in relation to your application.

   I have referred your application to Philip George Khoury who has been delegated with the necessary power by ASIC to decide your application.  Naturally, all of the material that you have already provided to me in support of your application has been referred to Mr Khoury.  He has requested that you provide me with any additional information which you request that he consider in support of your application by 18 June 1999.

   I note that you made complaint in the Application to the Federal Court that amongst other things, you have been denied natural justice.  I wish to make it clear that you are being given the opportunity to put any further material before the appropriate delegate and to make any further submissions you may wish to make.  You are invited to address any of the other matters raised by you in your Application to the Federal Court and these will also be taken into account.

   As it now appears that ASIC has not effectively made a decision with respect to your application, the proceedings which are currently on foot to review the decision which I conveyed to you by way of letter dated 14 April 1999 should be discontinued.  I would appreciate your response to this issue.”

5. Notwithstanding the receipt of the letter and ASIC’s offer to agree to the application of the appellants being discontinued the appellants declined the offer and appeared before the primary Judge on 23 June 1999 in order to persuade his Honour that the proceeding should continue.  In the meantime the respondent filed and served a notice of objection to competency pursuant to O 54 r 4 of the Federal Court Rules.

6. ASIC submitted to the primary Judge that there was no decision to quash and, accordingly, there was no matter before the Court which could or should attract its jurisdiction.  The appellants, appearing by the second appellant who acted as solicitor for the first appellant, contended that the application should continue and challenged the concession by ASIC that there was no decision to quash.

7. In his reasons for judgment the primary judge stated that if he allowed the matter to proceed to trial on the material before him it would be inevitable that the application would be dismissed.  His Honour decided that, as the decision the subject of the application no longer existed and the appellants were not inhibited by the purported decision, it was appropriate to dismiss the application.

8. His Honour, referring to the contention of the appellants that he should permit the matter to proceed to judgment to enable the Court to give guidance or directions to ASIC as to how it should go about its task afresh, observed that:

   “It is not the practice of this Court to give advisory opinions or to deal with matters which are hypothetical.”

9. The appellants have appealed from the decision of his Honour. In substance, two main grounds were relied upon. The first was that the Court ought not to be satisfied that the decision refusing the appellants’ application pursuant to s 55A of the Insurance Contracts Act was ultra vires.  It was said that ASIC had not properly satisfied the trial Judge that the decision was a nullity and, in any event, it was estopped from contending that the decision was a nullity.  The second ground was that the discontinuance had the effect of preventing the appellants from having the opportunity of obtaining a judgment in which the Court could point out the errors made by Mr Grayson and give guidance or directions to ASIC as to how it should decide the matter afresh.

10. Counsel for ASIC took the Court to ss 7, 8, 9, 12A and 102 of the ASIC Act and submitted that the statutory scheme was plainly one in which the only power of delegation by ASIC of its functions or powers, whether under the ASIC Act, the Insurance Contracts Act or other relevant legislation, was where the Commission had, by writing under its common seal, delegated the functions or powers in accordance with s 102 of the ASIC Act. ASIC, in reliance, inter alia, upon the decisions of the Court in Din v Minister for Immigration and Multicultural Affairs (1997) 147 ALR 673 and Ozmanian v Minister for Immigration, Local Government and Ethnic Affairs (1996) 137 ALR 103, contended that the existence and detail of the specific powers of delegation in s 102 and the power of the Commission to give directions in s 102(5) indicate that the legislature intended that the exercise of the relevant functions or powers be by the repository personally that is, ASIC, or by ASIC’s delegate under a delegation pursuant to s 102.

11. We have carefully considered the contention of ASIC and are satisfied that it properly made the concession that, in the circumstances of the present case, Mr Grayson did not have any power or authority to make the decision pursuant to s 55A. In those circumstances, we consider that it was both proper and correct for his Honour to accept and act upon that concession in forming the view that the decision the subject of the ADJR Act application does not have any operative effect and cannot inhibit the appellants from having their application under s 55A of the Insurance Contracts Act considered anew by an authorised delegate of ASIC.  Whilst it is unnecessary for us to make any final determination as to whether there could, as a matter of law, be an estoppel in respect of the validity of the decision made, we are satisfied that ASIC’s concession was also properly made on the additional ground that no estoppel could arise in the circumstances of the present case.

12. The question arises as to whether, in the circumstances, any purpose could be served by the proceeding being continued. We are of the view that his Honour was correct in rejecting the appellants’ submission that the matter should be permitted to proceed in any event so as to enable the Court to give guidance or directions to ASIC as to how it should go about its task. Indeed, before us the appellants accepted that if the Court formed the view that the concession made by ASIC as to the nullity of Mr Grayson’s decision was properly made and the appellants were in no way inhibited in pursuing their application pursuant to s 55A of the Insurance Contracts Act then it would amount to an abuse of process of the Court for the matter to continue.

13. We are in no doubt that it would be an abuse of the process of the Court for the proceeding to continue where the appellants’ sole or principal purpose was for the Court to give guidance or directions to ASIC as to how it should approach its task under s 55A of the Insurance Contracts Act.  The appellants have been invited by ASIC to put any further material and submissions that they wish to put before the Commission and, at this stage, it is hypothetical as to whether that material will be the same as that considered by Mr Grayson.

14. Accordingly, as the purpose for which the appellants sought to have the proceedings continued is not a proper purpose and amounts to an abuse of process, we are satisfied that it was appropriate for his Honour to dismiss the application. It may have been open to the appellants to have applied to his Honour to make formal orders or declarations which had the effect of making it clear that the previous decision was a nullity and did not inhibit the appellants from having their application under s 55A decided according to law. The appellants did not seek those orders and made it clear, both before his Honour and before us, that such orders were not regarded by the appellants as a sufficient remedy. As we have already explained, we are of the view that the directions which the appellants indicated they proposed to seek were not properly available to them.

15. It follows from the foregoing that the appeal should be dismissed. In these circumstances, it is unnecessary for us to consider whether a notice of objection to competency was the correct form of procedure to deal with the circumstances which had arisen. Prima facie, a decision purportedly made without jurisdiction and a decision not authorised by the enactment in pursuance of which it was purportedly made are reviewable decisions under ss 5(1)(c) and (d) of the ADJR Act. Thus, there are difficulties in the path of a person who wishes to contend that a decision made without jurisdiction or authority is not reviewable under the ADJR Act. On the other hand, it may well be that, in the circumstances of the present case, as it was conceded by ASIC that no decision had been made, there was no longer a justiciable controversy between the parties. In these circumstances, we have refrained from expressing a concluded view as to the appropriateness of the procedure adopted by ASIC before the primary Judge in that regard. Our decision therefore, is that his

    Honour arrived at the correct result, although this Court has reached its decision in the matter by a different route.

I certify that the preceding fifteen (15) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Merkel, Weinberg and Kenny.

Associate:

Dated:             17 November 1999

Solicitor for the First Appellant:	Mr MI Petch
For the Second Appellant:	The Second Appellant appeared in person
Counsel for the Respondent:	Mr C Jose
Solicitor for the Respondent:	Australian Securities and Investments Commission
Date of Hearing:	17 November 1999
Date of Judgment:	17 November 1999