Khalid v Secretary, Department of Transport, Planning and Local Infrastructure
[2014] VSCA 115
•18 June 2014
SUPREME COURT OF VICTORIA
COURT OF APPEAL
S APCI 2013 0189
| MUHAMMAD KHALID | Applicant |
| v | |
| SECRETARY, DEPARTMENT OF TRANSPORT, PLANNING AND LOCAL INFRASTRUCTURE | Respondent |
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| JUDGES | WARREN CJ and SANTAMARIA JA |
| WHERE HELD | MELBOURNE |
| DATE OF HEARING | 21 February 2014 |
| DATE OF JUDGMENT | 18 June 2014 |
| MEDIUM NEUTRAL CITATION | [2014] VSCA 115 |
| JUDGMENT APPEALED FROM | Khalid v Secretary, Department of Transport, Planning and Local Infrastructure (Human Rights) [2013] VCAT 1839 (Justice Garde AO RFD, 12 November 2013) |
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PRACTICE AND PROCEDURE – Whether Court has power to make Protective Costs Order – Discretionary power to fix or cap a party’s liability for recoverable costs in advance of proceeding – Claim of discrimination relating to overseas student – New Zealand citizen – Holder of ‘special category visa’ – Whether a permanent resident of Australia – Transport (Compliance and Miscellaneous) Act 1983 (Vic) ss 220D(1), 220DA(1), 220DA(6) – Issues to be considered in the granting of a protective costs order – Corcoran v Virgin Blue Airlines Pty Ltd [2008] FCA 864; Bare v Small [2013] VSCA 204 considered.
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| Appearances: | Counsel | Solicitors |
| For the Applicant | Mr S Holt SC with Ms E Levine | Wotton & Kearney |
| For the Respondent | Ms C M Harris | Victorian Department of Transport, Planning and Local Infrastructure |
WARREN CJ
SANTAMARIA JA:
By summons dated 10 December 2013, Mr Muhammad Khalid (‘the applicant’) applied for a Protective Costs Order (‘PCO’) to limit his liability to pay costs in the event that the appeal he has brought against the orders of the primary judge is unsuccessful.[1] On 21 February 2014, the Court heard the summons and dismissed the application. The following are our reasons for making those orders.
[1]Khalid v Secretary, Department of Transport, Planning and Local Infrastructure (Human Rights) [2013] VCAT 1839 (‘Reasons’).
The applicant is a New Zealand citizen undertaking a Bachelor of Engineering at the Royal Melbourne Institute of Technology (‘RMIT’).[2] He commutes from his home in Broadmeadows to RMIT’s city campus to attend classes.[3] In January 2012, Public Transport Victoria informed him that he was ineligible for a student concession card because he holds a ‘special category visa’.[4] This is a visa solely for New Zealand citizens,[5] entitling them to remain in Australia provided that, among other conditions, they continue to hold New Zealand citizenship.[6] On 28 May 2013, the applicant obtained a student concession card because he holds a Healthcare card, but, as the primary judge said, ‘this does not affect the issues to be resolved in this proceeding’.[7]
[2]Reasons [1].
[3]Ibid.
[4]Reasons [2].
[5]Pursuant to the Migration Act 1958 (Cth) s 32; Reasons [25].
[6]The other conditions are that a person hold and present to ‘an officer or an authorised system’ a current New Zealand passport, and that they not be a ‘behaviour concern non-citizen’ nor a ‘health concern non-citizen’; Reasons [33].
[7]Reasons [2].
Section 220D(1) of the Transport (Compliance and Miscellaneous) Act 1983 (Vic) (‘TCM’) empowers the Secretary to the Department of Transport (‘Secretary’) to impose conditions on the entitlement to use public transport.[8] According to s 220DA(1), those conditions can include ‘that overseas students or specified classes of overseas students are not eligible for student concessions to use a public transport service’.[9] Section 220DA(3) states that a determination by the Secretary pursuant to s 220D(1) of the TCM is not discrimination on the basis of race under the Equal Opportunity Act 2010 (Vic) (‘EO Act’).[10]
[8]Reasons [8].
[9]Reasons [9].
[10]Ibid.
Two determinations by the Secretary, gazetted on 7 September 2010 and 21 December 2012, make overseas students ineligible for public transport concession cards.[11]
[11]Reasons [34]-[35].
Section 220DA(6) of the TCM defines ‘overseas student’ as a person holding a visa to study in Victoria pursuant to the Migration Act 1958 (Cth). Section 220DA(6) specifically excludes from the definition of ‘overseas student’ a person who is ‘(a) an Australian citizen; or (b) a permanent resident of Australia; or (c) a student with refugee status; or (d) an overseas exchange student; or (e) in receipt of an Australian Development Scholarship …’.
Whether the applicant is a ‘permanent resident’ of Australia within s 220DA(6) of the TCM is a central issue in the case.
The applicant brought a complaint against the Secretary for direct discrimination in breach of s 44 of the EO Act.[12] The Secretary responded, first, that no discrimination had occurred and, secondly, that the denial of the concession card was authorised by the TCM.[13] The Secretary also claimed that his conduct was authorised by s 75 of the EO Act which permits discrimination which ‘is necessary to comply’ with legislation.[14]
[12]Reasons [3].
[13]Ibid.
[14]Ibid.
By orders dated 12 November 2013, the primary judge dismissed the applicant’s complaint. The proper construction of ‘permanent resident of Australia’ in s 220DA(6) of the TCM[15] was central to his judgment. If holding a ‘special category visa’ meant that the applicant is a ‘permanent resident’ within the meaning of TCM he would be entitled to a concession card, because ‘permanent residents’ are exempted from the definition of otherwise ineligible ‘overseas students’.[16]
[15]Reasons [46].
[16]Ibid.
The judge found that the Secretary did discriminate on the grounds of race but this was authorised by the provisions of the TCM permitting the Secretary to impose conditions relating to overseas students.
The judge rejected the Secretary’s submission that there was no discrimination. The Secretary submitted that ‘the determination addressed migration status, or particular classes of student … [and] … did not treat New Zealand citizens differently because of their nationality …’.[17] The judge found that ‘[t]he relevant comparator’ was a student with Australian citizenship.[18] Special category visas are only available to New Zealand citizens and the determination made by the Secretary meant that such students were ineligible for a concession card.[19] The judge held that this was discrimination based on race because race encompasses ‘nationality’ and ‘national origin’ and the applicant’s New Zealand citizenship was ‘a substantial reason’ for the denial of a concession card.[20]
[17]Reasons [39].
[18]Reasons [41].
[19]Reasons [39].
[20]Reasons [40], [42].
The judge found that the ‘opening requirements of the definition of ‘overseas student’ [in the TCM] require reference to the Migration Act and Regulations’, while the other categories in the TCM (e.g. ‘Australian citizen’, ‘student with refugee status’) are either ‘defined or significantly informed by … the Citizenship Act, the Migration Act or the Regulations’.[21]
[21]Reasons [70]-[71].
The judge thus defined the phrase ‘permanent resident’ drawing upon the definition of ‘permanent resident’ in the Australian Citizenship Act 2007 (Cth) and Migration Act 1958 (Cth) and ‘Australian permanent resident’ in the Migration Regulations 1994 (Cth).[22] He justified this approach to the construction on the basis because otherwise ‘there would be no criteria and no legislative guidance to assist in determining an application on the basis of permanent residency of Australia’.[23] Parliament would likely not have intended that those processing an application for a concession card query the Australian residency, or intended long-term Australian residency, of an applicant.[24] Rather, the process was intended to be straightforward, such as by a person offering documented proof of their visa.[25]
[22]Reasons [72].
[23]Reasons [85].
[24]Reasons [86].
[25]Ibid.
The judge found that the applicant was not a permanent resident of Australia for the purposes of citizenship and migration legislation.[26] He considered that this required a permanent visa to reside in Australia pursuant to the Migration Act 1958 (Cth).[27] A special category visa is a temporary visa and the applicant had not sought or obtained a visa permitting permanent residency.[28] The judge thus rejected the applicant’s submission that a special category visa is a ‘proxy for permanent residency status under the Migration Act’ because such visa holders are entitled to remain in Australia indefinitely.[29]
[26]Reasons [83].
[27]Reasons [77].
[28]Reasons [83].
[29]Reasons [81]; see [3] above.
The judge noted the ‘irresistible clearness’ of Parliament’s intention in s 220DA of the TCM to negate the right against racial discrimination.[30] In relation to s 32 of the Charter of Human Rights and Responsibilities Act 2006 (Vic) (‘Charter’), he acknowledged the constructional choice open and the impact on human rights on the one hand, and the scope of the Secretary’s powers on the other, of the competing interpretations of ‘permanent resident’ advanced by the parties.[31] Yet he ruled that the Charter does not compel a construction which would treat temporary visa holders as holding permanent visas or special category visa holders as permanent residents.[32]
[30]Reasons [52].
[31]Reasons [56].
[32]Reasons [83].
Finally, the judge found that the discrimination was authorised by s 75 of the EO Act because s 220DA(1) of the TCM empowers the Secretary to impose conditions excluding overseas students from concessional travel.[33] He considered that s 220DA(3) of the TCM demonstrates Parliament’s intention to exempt, from the operation of the EO Act, any conditions imposed by the Secretary that may amount to racial discrimination.[34]
Application: Leave to Appeal
[33]Reasons [89].
[34]Ibid.
By summons dated 10 December 2013, the applicant now seeks both leave to appeal the judge’s orders and the granting of a PCO.
In support of his application, the applicant relied upon an affidavit affirmed by him on 21 February 2014, together with three affidavits of Lauren Hodes, his instructing solicitor, each of which was affirmed 10 December 2013. In opposition, the respondent relied upon two affidavits of James Lavery, Executive Director, Regulation, Governance and Law Division and General Counsel, Transport for the Department of Transport, Planning and Local Infrastructure, affirmed 3 February 2014 and 20 February 2014 respectively. In reply to Mr Lavery’s affidavits, the applicant relied upon an affidavit of Connor Louise Burdon-Bear affirmed 20 February 2014.
Leave to appeal from VCAT is required and may only be sought on a point of law.[35] The applicant submits that the test for leave, derived from Myers v Medical Practitioners' Board of Victoria,[36] is whether there is sufficient doubt attending a final order. The interests of justice are important and will usually be apparent when orders are final.[37] Leave will more readily be granted where a question of law raises a matter of ‘general or public importance’.[38]
[35]Victorian Civil and Administrative Tribunal Act 1998 (Vic) s 148(1)(a).
[36](2007) 18 VR 48, 55[28].
[37]Secretary to the Department of Premier and Cabinet v Hulls [1999] 3 VR 331, 335[8] – 337[17].
[38]Myers v Medical Practitioners' Board of Victoria (2007) 18 VR 48, 55[28].
According to the applicant, the case involves ‘a classic question of law’, namely, the meaning of ‘permanent resident of Australia’ for the purposes of the TCM.[39] There is no dispute regarding the facts.
[39]S v Crimes Compensation Tribunal [1998] 1 VR 83, 88–89.
The sole ground of appeal is that the Tribunal erred in ruling that s 220DA of the TCM authorised discrimination contrary to the EO Act.[40]
[40]Proposed Notice of Appeal dated 10 December 2013.
Present application for a PCO
The applicant also seeks a protective costs order. Three questions arise: (a) does the Court have jurisdiction to make such an order, (b) on the assumption that it does have jurisdiction, should it make such an order in this case, and, if so, (c) upon what terms should any such order be made?
In Bare v Small,[41] Hansen and Tate JJA held that the Civil Procedure Act 2010 (Vic) (‘CPA’) conferred on the Court the power to make a PCO to cap the liability of a party to pay costs of and incidental to an appeal. They said:
In our view, the Court has a discretionary power to fix or cap a party’s liability for costs in advance of an appeal if it considers such an order is appropriate to further the overarching purpose identified in s 7 of the CPA, namely ‘to facilitate the just, efficient, timely and cost-effective resolution of the real issues in dispute’. Such orders are a departure from the usual rule that costs follow the event but the power does not displace that rule. It would appear the power to fix or cap recoverable costs has its primary source in s 65C(2)(d) of the CPA, whether or not the other, wholly general, provisions would permit such a course. Whether a specific or general power is relied upon, the power must be exercised in furtherance of the overarching purpose, either because of the express terms of s 65C(1) or because of the effect of s 8 of the CPA.[42]
[41][2013] VSCA 204.
[42]Bare v Small [2013] VSCA 204, [35] (citations omitted). In Commissioner of State Revenue v Challenger Listed Investments Ltd (2011) 34 VR 617, Sifris AJA (with whom Buchanan and Tate JJA agreed) said (at 621[20]): ‘Although the Court of Appeal is not strictly bound by its previous decisions (and those of the Full Court before it), a review of the authorities compels the conclusion that the Court of Appeal will only depart from one of its own previous decisions (or a decision of the Full Court) if that decision is plainly wrong.’ In Nguyen v Nguyen (1990) 169 CLR 245, the High Court considered whether an intermediate appellate court should regard itself as bound by its previous decisions. In a joint judgment, Dawson, Toohey and McHugh JJ said (at 269): ‘Where a court of appeal holds itself free to depart from an earlier decision it should do so cautiously and only when compelled to the conclusion that the earlier decision is wrong. The occasions upon which the departure from previous authority is warranted are infrequent and exceptional and pose no real threat to the doctrine of precedent and the predictability of the law.’
In Bare v Small, the Court was particularly concerned with the important matters that the case was raising under the Charter. The Court said:
In particular, the interpretation and application of s 38 of the Charter potentially affects a great number of members of the public as the obligation to act compatibly with human rights, and to take into account human rights in decision-making, is a core obligation imposed by the Charter on all public authorities. Determining the consequence of a breach of s 38 carries a clear public interest. [43]
[43][2013] VSCA 204, [43].
The applicant submits some of the factors relevant for the granting of a PCO were articulated in Bare v Small[44] and in Corcoran v Virgin Blue Airlines Pty Ltd.[45] In Bare v Small, the Court identified the factors that were considered in Corcoran v Virgin Blue Airlines Pty Ltd. They said:
[44][2013] VSCA 204.
[45][2008] FCA 864.
In Corcoran v Virgin Blue Airlines Pty Ltd Bennett J held that the Federal Court had power to make a PCO pursuant to Order 62A rule 1 of the Federal Court Rules. Order 62A rule 1 provided that the Court may specify the maximum costs that may be recovered on a party and party basis. Order 62A rule 2 provided, inter alia, that costs were excluded from that maximum amount where a party:
(d)has otherwise caused another party to incur costs that were not necessary for the economic and efficient:
(i) progress of the proceedings to trial; or
(ii) hearing of the action.
The applicants’ complaint was that Virgin Airlines had discriminated against them, directly and indirectly, under the Disability Discrimination Act 1992 (Cth), by way of requiring them to travel on the aircraft with a carer if they were unable to carry out certain actions independently, for example, reaching out and pulling down an oxygen mask. Her Honour considered that amongst the factors to be considered in exercising the Court’s discretion to grant a PCO were the timing of the application; the complexity of the factual or legal issues raised; whether the applicant claimed damages or other form of financial compensation; whether the applicant’s claims were arguable and not frivolous or vexatious; the undesirability of forcing the applicant to abandon the proceedings; whether there was a public interest element to the case; the costs likely to be incurred by the parties; whether the party opposing the making of the order had been uncooperative and/or delayed the proceeding; and any other matters that could go towards establishing that there should be a departure from the usual rule that the costs follow the event. In our view, these other matters would include at least the applicant’s ability to pay costs. In addition, her Honour considered as relevant whether a significant number of members of the public may be affected and whether the basis of the challenge raises ‘significant issues’ as to the interpretation and application of statutory provisions. Her Honour held, applying these principles, that in the circumstances of the case it was appropriate to make a PCO.[46]
[46][2013] VSCA 204, [28]-[29] (citations omitted).
Applying the factors in those cases, the applicant submits that, absent a PCO, he could not satisfy a costs order and is likely to discontinue his appeal by reason of his poverty, a PCO will achieve a form of ‘equality of arms’; the point he agitates ‘is reasonably arguable’ and involves public interest considerations; he has pursued the matter ‘mindful of limiting costs’; is represented pro bono; and has approached the Secretary requesting he not seek costs although no agreement has yet been reached. While the applicant concedes that he seeks damages, the figure ‘is very small’ and he would consent to the order being mutual.
While the Secretary agrees that the Court has power to make a PCO, he contends that no case exists for such an order here. Unlike in Bare v Small[47] and Corcoran v Virgin Blue Airlines Pty Ltd,[48] the present case is one of ‘significantly less public importance’. Here, the issue is the applicant’s economic loss in not receiving concessional travel. As he holds a healthcare card, the applicant is entitled to concessional travel and will not benefit from any declaratory orders, while the number of people affected by this proceeding (full-time students on a special category visa with no other concession) is uncertain. The Secretary further submits that the applicant seeks damages, a matter suggesting ‘strongly against the grant of a PCO’. Moreover, the point being agitated is ‘not strong’ because of the Tribunal’s full and accurate analysis of s 220DA of the TCM.
[47]Independent investigation of alleged police assault.
[48]Discrimination involving care arrangements for people travelling on aircraft.
In oral submissions, counsel for the applicant submitted that ‘equality of arms’ between parties was necessary to achieve the just resolution of the real issues in dispute in accordance with the overarching purpose of the CPA.[49] Counsel suggested this was an important factor in granting a PCO.
[49]Civil Procedure Act 2010 (Vic) s 7(1) provides: The overarching purpose of this Act and the rules of court in relation to civil proceedings is to facilitate the just, efficient, timely and cost-effective resolution of the real issues in dispute.
In our opinion, the Court should not make any order limiting the liability of the applicant to pay costs in the event that the appeal he has brought against the orders of the primary judge is unsuccessful.
The main feature of cost allocation in civil litigation is that costs follow the event. Therefore, the unsuccessful party will normally have to pay a portion of the successful party’s costs, usually on a standard basis.[50] In some instances, that rule is departed from, but only in accordance with the CPA and the corresponding Supreme Court (General Civil Procedure) Rules 2005 (Vic) (‘the Rules’).[51]
[50]Supreme Court (General Civil Procedure) Rules 2005 (Vic) r 63.31.
[51]Supreme Court (General Civil Procedure) Rules 2005 (Vic) r 63.30.1.
The term ‘equality of arms’ does not appear in the CPA nor in the Rules.[52] These costs allocation rules have been the subject of considerable analysis, review and well developed jurisprudence.[53] The reports that led to civil procedure reform both here and in the UK, including those that led to the introduction of the CPA do not identify a principle of equality of arms as informing the CPA’s purpose, or as being necessary to the just determination of a dispute more broadly.[54] Given the long history of these rules, we do not accept, in the absence of clear words to the contrary, that s 7 of the CPA incorporates such a principle.
[52]In Bare v Small [2013] VSCA 204, the Court referred (at [20], to R (Corner House Research) v Secretary for State and Industry [2005] 1 WLR 260 (‘Corner House’). In Corner House, the Court of Appeal (Eng) held that it had the power to make a PCO under legislative provisions in similar terms to those of s 24 of the Supreme Court Act and r 64.24 of the Rules of Court, in the absence of any express power. In Bare v Small, the Court also referred (at [24]) to the relevant English rules of court governing civil procedure and observed: ‘However, the rules of court relied upon in Corner House prescribed their aim as being to enable ‘the court to deal with costs justly’. This included the provision, in r 1.1(2) of the rules governing civil procedure, that: Dealing with a case justly includes, so far as is practicable - (a) ensuring that the parties are on an equal footing.‘ There is no equivalent provision in the Rules. At [48], the Court said: ‘We have already noted in [24] above that the Victorian provisions are not concerned, as were the ones applicable in Corner House, with ensuring that the parties are on an equal footing.’
[53]See Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225; Hazeldene’s Chicken Farm Pty Ltd v Victorian Workcover Authority (No. 2) (2005) 13 VR 435.
[54]For a discussion of the overriding purpose see Victorian Law Reform Commission, Civil Justice Review, Report 14 (2008) [1.2]; Lord Woolf in Access to justice: final report to the Lord Chancellor on the civil justice system in England and Wales (London: HMSO, July 1996).
The present application is arguable, and not frivolous. However, in our opinion, a PCO should not be made.
In declining to make a PCO, we take into account the following matters:
(a) it is true that there is a question of law involved in the original application and in the appeal to this Court. However, the applicant has had the benefit of an extensive and closely reasoned judgment of the President of VCAT, who is a judge of the Supreme Court;
(b) the applicant is himself seeking damages, a matter which in other cases has been said to ‘suggest strongly against a grant of a protective costs order’. If the applicant wishes to pursue his claim for damages in the Court of Appeal, it seems to us that he should do so on the same basis as every other litigant seeking relief;
(c) the applicant is himself unaffected by the declaration he seeks. He is already entitled to concessional travel on public transport by reason of his holding a health care card;
(d) the Court has no evidence before it of the number of people who are affected by the determination in the way the applicant says he is affected;
(e) the case does not contain elements of public interest of the magnitude of those raised in Bare v Small.
The applicant must proceed with his appeal on the conventional basis of being at risk in relation to the respondent’s costs.
The application is dismissed.
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