Laws, R.J.S. v The Australian Broadcasting Tribunal

Re: RICHARD JOHN SINCLAIR LAWS
And: THE AUSTRALIAN BROADCASTING TRIBUNAL
No. NG 1181 of 1988
FED No. 83
Broadcasting

COURT

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Lockhart(1), Wilcox(1) and Hill(1) JJ.

CATCHWORDS

Broadcasting - Complaints of breach of radio program standard - Purported decision of Broadcasting Tribunal as to non-compliance with standard - No notice of complaints given to broadcast presenter before determination of breach - Application to the case of principles of natural justice - Statement by officer of Tribunal as to reasons for decision giving rise to defamation action by presenter against Tribunal - Whether Tribunal precluded from further action on the complaints by reason of apprehended bias.

Broadcasting Act 1942 ss.16, 17C, 119.

HEARING

SYDNEY

#DATE 21:3:1989

Counsel for the Appellant: Mr T E F Hughes QC with Ms C.F. Weigall

Solicitors for the Appellant: Hunt & Hunt

Counsel for the Respondent: Mr W H Nicholas QC with Mr J.S. Hilton

Solicitors for the Respondent: Australian Government Solicitor

ORDER

The purported decision of the respondent dated 24 November 1987, that, in broadcasting the John Laws program on 11, 12, 13, 15, 18, 19, 20 and 23 March 1987, radio station 2GB breached Radio Program Standard 3 upon each of those days, was, so far as that purported decision affected the question of whether the respondent should exercise its substantive powers under s.119(1) of the Broadcasting Act 1942 in respect of the appellant, of no force or effect.

The decision of the respondent to conduct an inquiry into the question whether the Tribunal should exercise its substantive powers under s.119(1) was null and void, insofar as that decision related to issues 4 and 5 set out in the Notice of Inquiry advertised on 16 September 1987.

Otherwise the appeal be dismissed.

There be no order as to the costs of either party.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

JUDGE1

This case arises out of radio broadcasts made by the appellant, Richard John Sinclair Laws. Over a period of two weeks, in March 1987, on his talk-back radio program on station 2GB, Mr Laws criticised Commonwealth Government expenditure on certain Aboriginal welfare activities. The conduct of these programs by Mr Laws attracted considerable criticism. As a result, the respondent, the Australian Broadcasting Tribunal ("the Tribunal"), investigated the content of, and the circumstances surrounding, the radio broadcasts. After discussions and correspondence with officers of 2GB, but not with Mr Laws, the Tribunal stated that it had decided that the broadcasts by Mr Laws constituted breaches of Radio Program Standard 3 ("RPS 3") and that an inquiry should be held to consider whether the Tribunal should exercise certain of its powers under the Broadcasting and Television Act 1942, now the Broadcasting Act 1942. In the present proceeding Mr Laws challenges the validity of both these decisions.

The Tribunal's duties under the Broadcasting Act include the determination of standards to be observed by licensees of commercial radio stations in respect of the broadcasting of programs: see s.16(1)(d). Pursuant to s.16(1)(d) the Tribunal has laid down a number of radio broadcasting standards, one of which, RPS 3, provides as follows:

"A licensee may not transmit a program which:

(a) is likely to incite or perpetuate hatred against; or

(b) gratuitously vilifies: any person or group on the basis of ethnicity, nationality, race, gender, sexual preference, religion or physical or mental disability."

The burden of the criticism made by the various complainants to the Tribunal was that the comments made by Mr Laws, and his handling of the contributions made by callers, contravened this standard. Amongst the letters sent to the Tribunal were letters from the Minister for Aboriginal Affairs and from the Aboriginal Legal Service. None of the letters asked, in terms, that the Tribunal take any particular disciplinary action against either 2GB or Mr Laws, but the letter from the Aboriginal Legal Service mentioned s.119 of the Broadcasting Act. That section provides:

"119. (1) Where a person has -

(a)presented in a live broadcast the whole or a part of a program; or

(b)passed or selected for broadcasting the whole or a part of a program (being a program that was subsequently broadcast), in respect of which, or in respect of the broadcasting of which, the program standards were not complied with or this Act was contravened, the Tribunal may, by direction having effect either indefinitely or for a period determined by the Tribunal -

(c)prohibit the person from presenting programs in live broadcasts or passing or selecting programs for broadcasting; or

(d)impose restrictions on the presenting by the person of programs in live broadcasts or on the passing or selecting by the person of programs for broadcasting.

(2) The Tribunal shall not give a direction to a person under sub-section (1) unless it has, by notice in writing served on the person, called upon the person to show cause, within a period specified by the Tribunal, why the direction should not be given.

(3)A person shall not contravene a direction of the Tribunal under this section."

On 8 April 1987 the Tribunal wrote to the Manager of 2GB requesting tapes of the programs of which complaints had been made. This letter enclosed the letter of complaint from the Minister for Aboriginal Affairs. Correspondence passed between the Tribunal and 2GB in April, May and June 1987, but the Tribunal neither directed any correspondence to Mr Laws nor sought any explanation from him.
On 4 September 1987 the Tribunal invited Mr Duncan, the General Manager of 2GB, to meet it in the near future "to discuss these problems with the management of 2GB at this stage of the investigations". In that letter the Tribunal stated:

"It has formed the view that breaches of that standard (RPS 3) may have occurred in that the broadcasts were likely to incite and perpetuate hatred against a group on the basis of race ..."

On 30 September 1987 a meeting was held between members of the Tribunal and representatives of 2GB. The Tribunal was represented by three of its members (the Chairman, Vice-Chairman and Ms Bailey) and certain of its officers. 2GB was represented by Mr Duncan and its Program Director. Mr Laws was not given notice of the meeting by the Tribunal. Nor was he invited to attend.
The broadcasts in question and the complaints about them were discussed during the meeting. At least one of the members of the Tribunal made some criticisms of Mr Laws' conduct of the programs. A reference was made to the fact that one of the options open to the Tribunal, if it found that breaches of RPS 3 had occurred, was to exercise its powers under s.119 of the Broadcasting Act.
The Tribunal sent a draft record of the notes of the meeting to 2GB and invited comments from it. On 14 October 1987 the Tribunal wrote to 2GB seeking any further material which the station might wish the Tribunal to consider. On 24 November 1987, following an exchange of correspondence between the Tribunal and 2GB's solicitors, the Chairman, Vice-Chairman and Ms Bailey issued a document concerning their investigation of the complaints about Mr Laws' programs. Although signed only by these three members, the document purported to be a decision of the Tribunal. The document included the following statements:

"It is the decision of the Tribunal that in broadcasting the John Laws program on 11, 12, 13, 15, 18, 19, 20 and 23 March 1987, 2GB breached Radio Program Standard 3 on each of those days.

...

In this case if Mr. Laws had tried to balance the extreme reactions of his callers, rather than inflaming them, if he had allowed callers with an opposing view to be heard rather than talking them down, if he had taken care that callers' views were presented, the Tribunal would have taken a different view. The Tribunal considers, based on the broadcast material, that Mr. Laws had researched the subject and that the debate could have been run in a balanced informational manner which would have been less likely to inflame extreme reactions in the audience, or to breach the standards.

The Tribunal not only read transcripts of these broadcasts but also listened to the tapes supplied by 2GB at its request. Several factors contributed to the Tribunal's assessment that the broadcasts were likely to incite or perpetuate hatred on the basis of race including: the provocative tone of voice used by Mr. Laws, his overbearing manner, his use of extreme language, his squashing of those who attempted to put other views and his frequent repetition of some references. ...

The Tribunal has found that breaches of RPS 3 occurred when 2GB broadcast the John Laws programs on 11, 12, 13, 15, 18, 19, 20 and 23 March 1987.

It follows that a breach of s.99(1A) occurred. Section 99(1A) states:

'A licensee shall supervise the broadcasting of the licensee's programs in such manner as to ensure that the program standards are complied with.'

Having found that the standard has been breached the Tribunal has several options when determining what weight should be attached to the breaches and what action should be taken as a consequence of their occurrence. ... Having determined that the John Laws programs ... breached Radio Program Standard 3, the Tribunal Members who made these decisions will recommend to the Tribunal that it hold an inquiry to consider whether its powers under s.119 or s.101, or both, of the Broadcasting and Television Act 1942 should be exercised. The Tribunal cannot exercise its powers under these sections without holding a public inquiry. ..."

The final paragraph of the document stated:

"The John Laws programs broadcast by 2GB on 11, 12, 13, 15, 18, 19, 20 and 23 March 1987 breached Radio Program Standard 3, and it follows that a contravention of ss.99(1A) occurred. It is proposed to recommend to the Tribunal that it hold an inquiry to consider whether it should exercise its powers under s.119 or s.101, or both." (p 74)

On 24 November 1987 the General Manager of the Tribunal sent a copy of this document, which he described as "the Tribunal's decisions and reasons", to Mr Duncan of 2GB.
On 27 November 1987 the Tribunal decided to hold an inquiry into whether it should exercise any of its powers under ss.85, 101 and 119 of the Broadcasting Act.
On 10 December 1987 an article in a journal published by the Tribunal, known as "ABTEE", reported that "the Tribunal has investigated the complaints" (regarding Mr Laws' programs) "and decided that breaches of RPS 3 occurred on 8 days in the stated period". After giving reasons for this conclusion the article stated that the Tribunal had decided to hold an inquiry into whether it should exercise its powers under ss.85, 101 and/or 119 of the Broadcasting Act in relation to the broadcasts. The article then set out the issues for the inquiry, to which reference will be made later.
On 11 December 1987 the Tribunal wrote to Mr Laws in these terms:

"INQUIRY INTO EXERCISE OF TRIBUNAL POWERS UNDER ANY OR ALL OF SECTIONS 85, 101 AND 119, OF THE BROADCASTING AND TELEVISION ACT 1942 AS A RESULT OF BREACHES OF THE STANDARDS AND THE ACT ARISING FROM BROADCASTS BY JOHN LAWS ON 2GB

This letter is to formally advise you that the Tribunal has commenced an inquiry into the above matter. The issues for this inquiry are listed in the attached notice of inquiry. This Notice of the inquiry will appear in the Gazette, ABTEE and the major metropolitan newspapers in the near future. A copy of the Notice is attached for your information."

This was the only communication sent by the Tribunal to Mr Laws regarding the subject broadcasts; although, from an early stage, 2GB had kept Mr Laws informed of the major developments in the Tribunal's investigations.
On 16 December 1987 a notice of the inquiry was published in the Commonwealth Government Gazette. The material terms of that notice are as follows:

"AUSTRALIAN BROADCASTING TRIBUNAL NOTICE OF INQUIRY

EXERCISE OF TRIBUNAL POWERS UNDER ANY OR ALL OF SECTIONS 85, 101 AND 119 OF THE BROADCASTING AND TELEVISION ACT 1942 AS A RESULT OF BREACHES OF THE STANDARDS AND THE ACT ARISING FROM BROADCASTS BY JOHN LAWS ON 2GB

The Australian Broadcasting Tribunal is inquiring into whether to exercise its powers under any or all of sections 85, 101 and 119 of the Broadcasting and Television Act 1942 (the Act) as a result of breaches of the Standards and the Act arising from broadcasts by John Laws on 2GB. Written submissions are invited.

The inquiry follows a decision that the John Laws programs broadcast by 2GB on eight days during the period 11 to 23 March 1987 were in breach of Radio Program Standard (RPS) 3, and therefore that 2GB was in contravention of section 99(1A) of the Act. The issues to be considered in the inquiry are:

1. Whether the Tribunal should exercise its power under section 85 to impose a condition or conditions on the license for 2GB requiring the adoption of management procedures with relation to 'talkback' shows and the provision of programs to other licensees in order to prevent further breaches of section 99(1A);

2. Whether the Tribunal should exercise its power under section 101 to issue a written reprimand or admonishment to the licensee of 2GB;

3. If a written reprimand or admonishment is issued whether the Tribunal should direct the licensee of 2GB to publish the reprimand or admonishment, and if so, in what form and manner;

4. Whether the Tribunal should exercise its power under section 119 to issue directions:

(i) prohibiting John Laws from presenting programs in live broadcasts, or

(ii) imposing restrictions on the presenting by John Laws of programs in live broadcasts.

5. If the Tribunal issues a direction under section 119 for what period should it be determined to have effect. ..."

On 2 February 1988 this proceeding was commenced by Mr Laws under the Administrative Decisions (Judicial Review) Act 1977 seeking to review two decisions: first, the decision of 24 November 1987 that breaches of RPS 3 had occurred in relation to the broadcasts, and, second, the decision of 27 November 1987 to establish the inquiry.
On 29 April 1988 Ms Janet Paramore, the Director of the Programs Division of the Tribunal, was interviewed on station 2GB by Ms Jane Singleton with respect to the action taken by the Tribunal against Mr Laws. Ms Paramore repeated the substance of the decision of 24 November. In the course of the interview Ms Paramore said that during the relevant broadcasts Mr Laws took telephone calls where:

"he consistently referred to Aboriginal people in derogatory terms and consistently implied things that suggested that they were getting preferential treatment and that they were no-hopers and that if they got off their backsides they could fix everything up for themselves anyway.

The language used, his response to people with a different point of view that rang to try and explain that what he was saying about some of these schemes was not really accurate was bullying and overbearing and they did not get a fair go, whereas people who rang to reinforce the sort of things that he was putting in his editorial got open slather and elicited further comments from him which were derogatory."

On 25 May 1988 Mr Laws commenced proceedings for defamation against the Tribunal and Ms Paramore in the Supreme Court of New South Wales claiming damages including aggravated damages. A Defence was filed by the Tribunal and Ms Paramore on 3 August 1988. It is necessary to refer to these documents, especially the Defence, to consider an argument advanced on behalf of Mr Laws in these proceedings, but it is convenient to deal with this later. The pleadings were not in evidence before the learned trial Judge. But we admitted them into evidence on the hearing of the appeal, for reasons which we gave during the hearing.
The present proceeding
Before the primary Judge, Morling J, Mr Laws sought orders quashing the Tribunal's decision of 24 November 1987, substantially upon the ground that, in reaching a decision that the various broadcasts had contravened RPS 3 without first hearing Mr Laws, the Tribunal had breached the rules of natural justice. Mr Laws also sought to quash the decision of 27 November 1987; which, he claimed, was consequential upon the earlier decision and assumed its validity. Mr Laws also sought an injunction restraining the Tribunal from proceeding further with any inquiry into the matter.
During the argument before Morling J, counsel offered to the Court two undertakings on behalf of the Tribunal: firstly, that the members of the Tribunal who would constitute the inquiry would not include any of the three persons who had signed the document of 24 November 1987; and, secondly, that, at that inquiry, Mr Laws would be regarded as entitled to challenge the view that the broadcasts contravened RPS 3.
Morling J was of the view that, if the rules of natural justice had relevance to the circumstances of the case, there had been a breach of those rules. That finding was not challenged before us. However, his Honour held that, upon the proper construction of the Broadcasting Act, the Tribunal had merely undertaken a preliminary investigation, preceding a formal inquiry under s.17C of that Act. It followed, in his Honour's view, that Mr Laws' rights had not been in any way affected. Specifically, Morling J found that:

. in making its decision of 24 November 1987 that there had been breaches of RPS 3, the Tribunal was not acting in purported pursuance of s.17C(2) of the Act and was "merely exercising its general powers under sub-s.17(1) and 124(2) of the Act when it made that decision";

. the effect of the document containing the written decision of the Tribunal of 24 November 1987 was "merely to recommend that an inquiry be held";

. the decision of 24 November 1987 "had no potential" radically to affect the rights of Mr Laws;

. no relevant significance should be attached to the publication by the Tribunal of the article in ABTEE;

. there was no justification for attributing the views expressed by Ms Paramore in the radio broadcast of 29 April 1988 to those members of the Tribunal who would constitute it for the purpose of conducting an inquiry under s.17(C)(1) and s.119 of the Act.

. "having heard from" Mr Laws the Tribunal may reach a different view "from that formed by the three members constituting the respondent on 24 November".

In relation to the composition of the Tribunal at the inquiry, Morling J took the view that Mr Laws ought not to be forced to rest content with an undertaking, that he was entitled to an order of the Court. Consequently, his Honour ordered that the Tribunal not proceed with the inquiry whilst the Chairman, the Vice-Chairman or Ms Bailey were present in their capacities as members of the Tribunal sitting in the division constituted for the purpose of the inquiry. His Honour ordered that otherwise the Application be dismissed, with no order as to costs.
The submissions in the appeal
Counsel for Mr Laws submitted to this Court on the hearing of the appeal that:

. the decision made on 24 November 1987 was, as published by it, a "decision of the Tribunal"; . the view expressed in the Tribunal's report of 24 November 1987 was that breaches of RPS 3 had, not may have, occurred;

. Mr Laws had not been heard with respect to the decisions of 24 or 27 November 1987, with the consequence that he was denied natural justice; in essence those decisions asserted that he was involved in the contraventions by 2GB of RPS 3; . the decision of 24 November 1987 was adopted by the Tribunal as the basis of its decision of 27 November 1987 to hold an inquiry; the earlier decision being invalid, the later decision became a nullity;

. by adopting as a necessary jurisdictional basis for an inquiry under s.119 the previous finding that there had been breaches of RPS 3, the whole Tribunal had prejudged Mr Laws adversely and in his absence. This was evidenced by the comments of Ms Paramore and the content of the Defence filed by the Tribunal in the defamation proceedings. In the result, all members of the Tribunal are precluded, on the basis of actual or constructive bias, from participating in any further consideration of the question of Mr Laws' alleged involvement in the breaches.

Counsel for the Tribunal submitted that:-

. the rules of natural justice did not apply to the processes of the Tribunal which resulted in the decisions of 24 and 27 November 1987 as they were merely preliminary investigations; . there was no justification for attributing to any members of the Tribunal the views expressed by Ms Paramore;

. the filing of the Defence in the defamation proceedings does not constitute any evidence that the assertions made in the pleading are the views of the members of the Tribunal or that those members have prejudged the outcome of the proposed inquiry

. if the Broadcasting Act imposes upon the Tribunal the duty to carry out an inquiry under ss.17C and 119, and if the Tribunal were perpetually disqualified from carrying out the inquiry, no other person or body would be available to hold the inquiry with the consequence that the doctrine of necessity operated to enable the Tribunal to proceed with the inquiry.

The statutory provisions

It is necessary to refer to the relevant provisions of the Broadcasting Act and to the Tribunal's role with respect to inquiries thereunder.
The Tribunal is constituted a body corporate with perpetual succession, a common seal, capacity to sue and liability to be sued under its corporate name as the Australian Broadcasting Tribunal (s.7). The Tribunal consists of a Chairman, a Vice-Chairman and at least one other member, but not more than six other members, all of whom are appointed by the Governor-General as full-time members (s.8(1)). Provision is made in s.10 for acting members where there is, or is about to be, a vacancy in the office of members of the Tribunal. Section 11 provides for the appointment of associate members. Associate members, together with full-time members taking part in an inquiry, may constitute the Tribunal for the purposes of any inquiry under the Act. Provision is also made for the appointment of acting associate members (s. 12).
The Chairman of the Tribunal may, for the purposes of an inquiry, constitute a division of the Tribunal consisting of a member or members designated by the Chairman and an associate member or associate members appointed for those purposes (s.15C(1)). A division of the Tribunal shall, for the purposes of holding the inquiry in relation to which it was constituted "and for the purposes of making decisions, recommendations and reports on the matter the subject of the inquiry", be deemed to be the Tribunal (s.15C(1B)).
Power is given to the Tribunal, either generally or as otherwise provided by the instrument of delegation, by writing under its common seal to delegate to a member any of its powers under the Act other than the power of delegation and its power to hold inquiries (s.15D(1)). A power so delegated, when exercised by the delegate, shall for the purposes of the Act be deemed to have been exercised by the Tribunal (s.15D(2)). There is no evidence that, in this case, any relevant power was exercised by any person as a delegate of the Tribunal.
The functions of the Tribunal are specified in s.16 and they include the functions of granting, renewing, suspending, revoking and accepting the surrender of licences (s.16(1)(a)); holding inquiries as provided by the Act or as directed by the Minister under s.18 and publishing reports in relation to those inquiries (s.16(1)(g)).
For the purpose of exercising its powers and functions under the Broadcasting Act the Tribunal is empowered to make such orders and give such directions and do all such other things as it thinks fit (s.17(1)).
The Gazette notice of 16 December 1987 stated that the Tribunal was inquiring into whether to exercise its powers under any or all of ss.85, 101 and 119 of the Broadcasting Act as a result of the breaches of RPS 3. Section 85 empowers the Tribunal to vary or revoke conditions of broadcasting licences. Section 101 empowers the Tribunal to issue to licensees in writing reprimands or admonishments where contraventions have been made by the licensee of sub-s.99(1A) in relation to the broadcasting of programs. Sub-section 99(1A) provides that a licensee shall supervise the broadcasting of its programs in such manner as to ensure that the programs standards are complied with. Sub-section 101(2) empowers the Tribunal, in addition to issuing a reprimand or admonishment, to direct the licensee in writing to publish the reprimand or admonishment in a form and manner specified by the Tribunal in the direction, and the licensee is bound to comply with the direction. Section 119 has already been quoted.
Division 3 of Part II of the Broadcasting Act relates to "Inquiries by the Tribunal". The Division provides for "Ordinary Inquiries" (s.17C), "Directed Inquiries" (s.18) and "Area Inquiries" (s.18A). This case is concerned with the provisions relating to Ordinary Inquiries.
A person may at any time make an application under s.17B requesting the Tribunal to exercise any of its "substantive" powers. Where the Tribunal receives such an application, or where the Tribunal itself proposes to exercise any of its substantive powers otherwise than on such an application, it must hold an inquiry into the requested or proposed exercise of the power: see s.17C(1) of the Act and Australian Broadcasting Tribunal v Bond (1988) 81 ALR 508. A reference in Division 3 to a substantive power of the Tribunal is a reference to a power of the Tribunal to do any one of the things specified in paras.(a) to (r), inclusive, of s.17A(2). The specified powers include a power to give directions under s.119(1). It follows that a direction under s.119(1) may not be given until an inquiry has been held under s.17C. Moreover, the Tribunal cannot give such a direction unless it has, by notice in writing served on the person, called upon the person to show cause why the direction should not be given (s.119(2)).
The inquiry contemplated by s.17C, in the circumstances of the present case, is an inquiry into the question whether the Tribunal should exercise its power to give a direction pursuant to s.119(1). That inquiry may, of course, also be an inquiry into the possible exercise of other substantive powers, such as those under ss.85 and 101, as is here intended. Under such circumstances nothing is to be gained by asking whether the inquiry is being held under s.17C or under s.119. The important point is that no direction under s.119(1) can be given to a person until that person has been called upon to show cause why the direction should not be given. The inquiry, whether it is seen as being constituted under s.17C alone or under a combination of ss.17C and 119, must determine that there has been a contravention of a relevant program standard and that a particular direction should be given.
There was some discussion before us as to whether the appropriate procedure involved a one or a two stage process. It was said that, if a two stage procedure were appropriate, the first stage would involve a decision as to contravention and, if a contravention were found, that a notice be given. The second stage, which could proceed only after the giving of the s.119(2) notice, would involve the question whether a particular direction should be given to the particular person called upon to show cause.
It seems to us that, in a case in which a direction is given under s.119(1), the decision-making process of the Tribunal must necessarily involve two stages. The Tribunal may decide to hold a formal inquiry into whether program standards were not complied with, or the Broadcasting Act was contravened, on some particular occasion or occasions and, if that question is answered in the affirmative, the Tribunal may then decide to hold a further inquiry as to whether a direction should be given pursuant to s.119. But two separate formal inquiries will not necessarily be required. Ordinarily, one inquiry may suffice. The Tribunal is not obliged to hold a formal inquiry in order to determine if a program standard was not complied with or the Act was contravened. The Tribunal may conduct an informal investigation, falling short of a formal inquiry, sufficient to enable it to determine whether there has been a non-compliance or contravention; so that it establishes a formal inquiry only if that first question is answered by it affirmatively. Provided that, in undertaking this course, the Tribunal gives to all persons potentially affected by any determination of non-compliance or of breach an opportunity to be heard upon that question, any such determination will be valid. It will constitute a proper starting point for the subsequent formal inquiry which may then properly be limited to the question whether a direction should be given under s.119(1). Alternatively, the Tribunal may hold an inquiry with two stages: first, concerning the question of non-compliance or contravention; and, if that question is answered by the Tribunal in the affirmative, it may then reconvene the inquiry and proceed to the next stage where the question will be whether a direction should be given pursuant to s.119. The notice in writing calling upon the person to whom it is directed to show cause why the direction should not be given (see s.119(2)) may, in our opinion, be given either before the first stage of a two stage inquiry is held or before the second stage commences.
We have set out the above examples of the possible courses open to the Tribunal. It is for the Tribunal to determine the appropriate course, provided that the statutory requirements and the rules of fair play are observed.
The case where the Tribunal has not received an application to exercise its substantive powers, but itself proposes to exercise the power, does not differ in principle from the case where an application for the exercise of these powers has in fact been received. As was held in Bond, a decision of the Tribunal that an exercise of a substantive power is a possible outcome of an inquiry is sufficient to give rise to an obligation under s.17C to hold the inquiry.
The decisions of 24 and 27 November 1987
The decision of 24 November 1987 that there was a breach of RPS 3 was made by three members of the Tribunal. The status of that decision is not clear. It was not a decision of the Tribunal, fully constituted. It could not have been a decision of a division of the Tribunal because no inquiry was then being held. So far as the evidence shows, there was no decision to hold an inquiry into the subject broadcasts until 27 November. Nor is there any evidence to suggest that the three members had been appointed as delegates of the Tribunal. Notwithstanding these matters, the document of 24 November referred to various findings and decisions "of the Tribunal".
If the relevant decisions were limited to that of 24 November 1987, it might be possible to hold that the only thing which had occurred was that a preliminary investigation had been carried out by three members of the Tribunal and that they had reported their findings, in inappropriate language but without affecting the entitlement of those members who would conduct the recommended inquiry to consider for themselves the issue of non-compliance with RPS 3. This would accord with the view taken by Morling J; which view, we should in fairness say, was formed before his Honour had the benefit of the Full Court decision in Bond. However, whatever the position if the decision of 24 November 1987 stood alone, the full Tribunal, or at least a quorum of its members, on 27 November 1987 adopted that decision. It is true that the resolution of 27 November does not contain words of express adoption. The Tribunal's resolution was limited to a decision to hold an inquiry into the question "whether it should exercise any of its powers under ss.85, 101, and 119 of the Act". As a theoretical proposition, it is true that such an inquiry could start with the issue whether or not there had been a non-compliance with RPS 3. But, in the present case, the Tribunal appears not to have so intended. The article in "ABTEE", the Tribunal's own journal, spoke of "the Tribunal's assessment", along with "the Tribunal's decision" to hold an inquiry. The issues for the inquiry, as advertised in December 1987, contained no item pertinent to the question whether a non-compliance had occurred. All of the stated issues were issues which could only arise if a non-compliance were proved. The impression given by this statement of issues is reinforced elsewhere in the notice. The heading spoke of the inquiry into the exercise of powers "as a result of breaches of the Standards and the Act". Reference was made in the body of the advertisement to "a decision that the John Laws' programs ... were in breach of" RPS 3. Any reader of the advertisement, in our opinion, would clearly understand that the issue of non-compliance had already been determined, adversely to 2GB and to Mr Laws, and that, consequently, this was not a matter for consideration at the inquiry.
It is difficult to understand why the Tribunal omitted to give any notice of its investigations to Mr Laws prior to 11 December 1987. No doubt it is natural for members and officers of the Tribunal, when handling complaints as to the content of broadcasts, to think immediately of the relevant licensee. Section 99 casts upon licensees responsibility for compliance with the radio program standards. But Mr Laws was referred to by name in the various complaints, specific reference being made, in one complaint, to s.119. It should have been obvious to the Tribunal that Mr Laws had a direct interest in the outcome of the Tribunal's investigations. If non-compliance were found, Mr Laws might be damaged both in his reputation and his livelihood.
Whatever the explanation of its action, the decision of the Tribunal that the program standard had not been complied with constituted, as against Mr Laws, a breach of the rules of natural justice. Mr Laws was neither heard nor given an opportunity of being heard before that decision was made.
The relevant principles were expressed by Mason J in Kioa v West (1985) 159 CLR 550 at pp 584-585:

"The law has now developed to a point where it may be accepted that there is a common law duty to act fairly, in the sense of according procedural fairness, in the making of administrative decisions which affect rights, interests and legitimate expectations, subject only to the clear manifestation of a contrary statutory intention. ...

... the expression 'procedural fairness' more aptly conveys the notion of a flexible obligation to adopt fair procedures which are appropriate and adapted to the circumstances of the particular case. The statutory power must be exercised fairly, i.e., in accordance with procedures that are fair to the individual concerned in the light of the statutory requirements, the interests of the individual and the interests and purposes, whether public or private which the statute seeks to advance or protect or permits to be taken into account as legitimate considerations: cf. Salemi (No. 20 (1977) 137 CLR at p 451, per Jacobs J."

See also Twist v Randwick Municipal Council (1976) 136 CLR 106, at pp 109-110, J v Leischke (1986) 162 CLR 447 at pp 450, 457 and 462 and de Smith Judicial Review of Administrative Action 4th Edn p 234.

Two questions remain, in respect of this aspect of the case. The first question is whether it is sufficient for the Court to accept the assurance of counsel for the Tribunal that, at the forthcoming inquiry, Mr Laws will be free to contest the issue of non-compliance. We do not doubt the genuiness of this assurance but we do not think that it is satisfactory to adopt that course. A direction under s.119 is a serious step, involving not only the position of the particular person but also the public interest. The public has an interest in the maintenance of freedom of speech even, perhaps especially, in connection with controversial matters. At the same time, as the radio program standards themselves recognise, it is in the public interest that this freedom not be abused, as, for example, by the gratuitous incitement of hatred or dislike of particular groups in the community. The balance between these two interests is a delicate one. The striking of that balance is a matter which affects the whole community. Inquiries are intended to be public events. Section 19 of the Broadcasting Act prescribes a principle that proceedings at an inquiry shall be held in public. Regulation 9 of the Australian Broadcasting Tribunal (Inquiries) Regulations requires the advertising of issues for an inquiry. The evident purpose of this regulation is to provide the information necessary to enable members of the public to decide whether the matters to be considered at an inquiry are such that they ought to seek to participate in the inquiry. It would be inconsistent with the policy underlying the regulation, in our opinion, for this Court to countenance a situation wherein, by agreement between the Tribunal and one interested person, the true issues for an inquiry were other than as notified to the public. If the inquiry is to proceed, the appropriate course is for the Tribunal to start again, to resolve to institute the inquiry without any pre-determination, express or implied, against Mr Laws as to non-compliance with RPS 3 and with issues so framed as to include the question of non-compliance.
The second question relates to the position of 2GB. Representatives of 2GB were heard during the course of the investigation by the three Tribunal members. So far as appears, 2GB has accepted the decisions of 24 and 27 November 1987. No case is sought to be made by Mr Laws in relation to the decisions as they affect 2GB. Such a case would be difficult to make. The rules of natural justice direct attention to the position of each individual potentially affected by a decision. In a case where a decision-maker has afforded an opportunity to be heard to one of the persons potentially affected by the decision, but not to another, the decision relating to the former will not ordinarily be affected by the breach of duty towards the latter. There may be some exceptions to this principle, for example where the inability to fix the latter person with the effect of the decision changes the substance of the decision vis-a-vis the former. But that is not this case. The effect of any disciplinary action against 2GB, as licensee, would not depend upon the fate of Mr Laws.
However, it is difficult to see how an inquiry could be conducted which, in relation to 2GB, was confined to the question of the appropriate orders but which simultaneously considered the issue of non-compliance, in relation to Mr Laws. It seems to us that, if the Tribunal decides to proceed further with the matter, the better course would be for it to start afresh, both as against 2GB and Mr Laws.
In reaching the above views we have not found it necessary to determine a matter which was raised in argument before us: whether any or all of the letters received by the Tribunal amounted to requests to exercise substantive powers within the meaning of s.17B of the Broadcasting Act, so that the Tribunal became obliged to hold an inquiry under s.17C. It is possible to argue that some of the letters of complaint, particularly the letter from the Aboriginal Legal Service, constituted an application under s.17B for the Tribunal to exercise its substantive powers under s.119(1). The Broadcasting Act itself prescribes no formalities for such an application. Regulation 4 of the Australian Broadcasting Tribunal (Inquiries) Regulations provides for an application under s.17B to be in accordance with the appropriate approved form; but no form is prescribed. Regulation 4(3), which could not in any event confine the operation of s.17C(1) of the Act, provides that, with the consent of the Tribunal, an application may be made in other than the approved form. Moreover, reg.4(4) states that strict compliance with the regulation is not necessary and that substantial compliance is sufficient.

As previously indicated, the Tribunal may hold an inquiry into the possibility of exercising a substantive power at its own discretion, whether or not it has received a complaint under s.17B. The only relevance which was attached, in argument, to the status of the letters of complaint was that this status was said to determine whether or not the Tribunal was under an obligation to hold an inquiry. The answer to this question was said to affect the next question, whether the Tribunal is precluded from proceeding with an inquiry because of the doctrine of bias. But it seems to us that counsel's concern with the status of the letters overlooked the fact that, if the Tribunal decided that it ought further to pursue the matter, in relation to Mr Laws, a decision to that effect would amount to a proposal to exercise its substantive powers: see Bond. Any such decision would itself trigger an obligation to hold an inquiry, regardless of whether there was before the Tribunal any request under s.17B. Under these circumstances, the question of bias must be approached upon the basis that the Tribunal now has or, if the matter is taken any further, will acquire a statutory duty to inquire.
Future inquiry
Before turning to the matter of bias it is convenient to mention a subsidiary submission supporting Mr Laws' application for an injunction restraining the Tribunal from proceeding further in respect of the subject broadcasts. Counsel submitted that irreparable harm would be done to Mr Laws if the complaints were to be pursued against him at this stage. It was said that Mr Laws would be prejudiced at any inquiry because of the time which had elapsed since the subject programs were broadcast and because he was not notified of the proposal to hold an inquiry until December 1987. It appears that some evidence, which would otherwise have been available to him, has been lost, including tapes of other programs broadcast at about the same time as the programs involved in this case. Counsel contended that, if those tapes were available, they would afford support for Mr Laws' contention that the impugned programs did not breach RPS 3. This argument was rejected at first instance. Morling J pointed out that it was not suggested that Mr Laws was not able to give an account in general terms of the programs which are no longer available on tape and that it would be open to him to give his own account of those programs and of the context in which they were broadcast. We agree with this comment. But, in so doing, we do not wish to give the impression that we necessarily accept the assumption which seems to underlie counsel's submission. It is difficult to see how the question whether Mr Laws' own programs failed to comply with RPS 3 can be affected by the content of other broadcasts which may have been made at about the same time. It seems to us that the critical question, in relation to the matter of non-compliance, is the content of the subject programs themselves. The tapes of those programs are still available. But, should it appear, at any inquiry, that any material evidence has been lost, this will be a matter for the Tribunal to consider in reaching its conclusions of fact. No ground has been established for disturbing his Honour's findings on this aspect of the case.
There remains the submission of counsel for Mr Laws on bias. Counsel argued that the three members of the Tribunal who made the decision of 24 November 1987, having expressed conclusions upon an issue which is properly still at large, must be regarded as biased in point of fact. Counsel further submitted that all of the members of the Tribunal would be perceived by a reasonable observer as being biased against Mr Laws, with the consequence that the Tribunal is forever barred from holding any inquiry into his involvement in the broadcasts.
The rule that a judge or person performing quasi-judicial functions should not sit to hear a case if, in all the circumstances, the parties or the public might reasonably suspect that he was not unprejudiced and impartial is well established: see The Queen v Commonwealth Conciliation and Arbitration Commission; Ex parte Angliss Group (1969) 122 CLR 546 especially at p 553; The Queen v Watson; Ex parte Armstrong (1976) 136 CLR 248 at pp 258-262; Livesey v New South Wales Bar Association (1983) 151 CLR 288 especially at p 300; A P M Investments Pty. Limited v Trade Practices Commission (1984) 2 FCR 116 and The Queen v Maurice; Ex parte Attorney-General (NT) (1987) 73 ALR 123.
However, the argument as to actual bias must fail. Even if it were correct to say that the three members of the Tribunal who participated in the decision of 24 November might reasonably be suspected of suffering from bias in any future proceedings involving these broadcasts, there are other members who may conduct the proposed inquiry and make decisions on behalf of the Tribunal in relation to Mr Laws. The effect of the order made by the primary Judge will be to require any inquiry to be conducted by one or more of those members. We permitted evidence to be adduced before us as to the present composition of the Tribunal and the changes in its composition between 24 November 1987 and the present date. This evidence shows that one of the persons who participated in the decision of 24 November 1987 has since resigned. Only two of the present eight members participated in the impugned decision, leaving six members available to consider the issue afresh.
Counsel for Mr Laws did not submit that any of these six members was biased in point of fact. But they did contend that all six members, including even the five members who have been appointed since the Tribunal's decision of 27 November 1987, were disqualified by the doctrine of constructive bias. Passing reference was made by counsel to the notion of "institutional bias": see the discussion in Casey v Australian Broadcasting Tribunal (Wilcox J, 24 November 1988, not reported). However, the argument as to constructive bias rested essentially on the construction and effect of the Defence filed on behalf of the Tribunal in the defamation proceedings.
Mr Laws, the plaintiff in the defamation proceedings, complained therein of some of the statements made by Ms Paramore in the interview with Ms Singleton to which we have referred. In para.5 of his Statement of Claim Mr Laws averred as follows:

"The matter complained of in its natural and ordinary meaning contain the following imputations each of which were defamatory of the plaintiff:

(a) That the plaintiff lacked any capacity to care for fellow human beings.

(b) That the plaintiff wrongly manipulated discussion on his talk-back radio program so as to brodcast biased and one-sided material.

(c) The plaintiff was a person who used and was prepared to use disgustingly racist derogatory words to describe members of ethnic groups.

(d) That the plaintiff behaved in a manner which was unfair to people who called up on his program.

(e) That the plaintiff was a bully who engaged in conduct of a rude and arrogant nature towards callers."

The Defence filed on behalf of the Tribunal denied para.5 of the Statement of Claim. Further and alternatively it contained a plea in justification of imputations (b), (d) and (e), but not imputations (a) and (c). The Defence also claimed contextual justification. Paragraph 7 in part is in the following terms:

"Further and in the alternative, the defendants say that insofar as and to the extent that it may be found that the matter complained of was published of and concerning the plaintiff and to be defamatory of him either in its natural and ordinary meaning or as bearing one or more of the imputations in question (which is denied) each of the imputations in paragraph 5 of the Statement of Claim:

(a) related to matters of public interest and was published contextually to the following imputation: The plaintiff conducted a series of radio programs that were desgined to lower the community's views of Aboriginal people. (which was a matter of substantial truth and also related to matters of public interest) and by reason of the substantial truth of the said contextual imputation, the said imputation (sic) in question did not further injure the reputation of the plaintiff ..."

The Defence of the Tribunal was not verified on oath. Verification is not necessary under the Supreme Court Rules. Nonetheless,it was argued for Mr Laws that the filing of the Defence was a solemn corporate act and that, if the words spoken by Ms Paramore were found to be defamatory and if Mr Laws were ultimately found by the Tribunal not to have breached the Tribunal's standards, the raising of the Defence would sound in aggravated damages. Thus it was said that for the Tribunal -- however constituted -- now to decide the issue of breach of RPS 3 by Mr Laws would be for the Tribunal to determine a matter in which it had a material interest. If it found in favour of Mr Laws, it would act against its own interest. A favourable finding, it was said, would have the result of increasing the amount of the damages which the Tribunal might have to pay to Mr Laws.
Counsel did not explain why this argument, if accepted, ought to lead to the grant of a perpetual injunction. The defamation action will be disposed of at some stage, whether by trial or by compromise. Thereafter there could be no difficulty in the Tribunal embarking upon an inquiry in respect of these broadcasts. At the most, as it seems to us, the argument would support an injunction restraining further action by the Tribunal only until the disposal of the defamation action. However, in our opinion, Mr Laws is not entitled even to that relief. The fact of the Defence having been filed in the defamation proceedings does not lead to the conclusion urged by counsel.
The Defence to the defamation action filed on behalf of the Tribunal does not constitute an admission by the Tribunal of the truth of the facts and matters asserted in its pleading. The Defence is merely a statement of the Tribunal's case: see Boileau v Rutlin (1848) 2 Ex 665; 154 ER 657, Stohl Aviation v Electrum Finance Pty Limited (1985) 5 FCR 187 per Jenkinson J at p 201 and Phipson on Evidence, 13th ed para.20-41 (p 401).
It may reasonably be assumed that the members of the Tribunal, whenever appointed, would hope that the Tribunal is successful in the Supreme Court. But it goes too far to say that such members, excluding perhaps those members who were concerned in the investigation, would reasonably be thought to be unable to bring an unbiased mind to the conduct of any future inquiry. It has not been suggested that any member of the Tribunal is personally involved in the defamation proceedings. The liability imputed to the Tribunal is a vicarious liability for the words of Ms Paramore. If the action succeeds no member of the Tribunal would be personally liable to pay any money in respect of the proceedings. All that has been suggested is that an adverse verdict would constitute a drain on the Tribunal's funds, possibly affecting the scope of its other activities. We accept that such a limitation might occasion some regret to members of the Tribunal; but it seems to us to be fanciful to apprehend that such a remote and nebulous possibility could affect a Tribunal member in the discharge of his or her obligations at the inquiry. It may safely be assumed that all members of the Tribunal are aware of the importance of approaching any inquiry with complete integrity.
As to what might be called institutional bias generally, that is excluding the fact of the defamation proceedings, it is sufficient for us to adopt the view expressed by Wilcox J in Casey.
Having regard to the foregoing, it is not necessary for the respondent to resort to the doctrine of necessity. However, we indicate our view that if, contrary to our finding, constructive bias was made out that principle would apply. Once again, we refer to Casey. We add a reference to one additional authority, the decision of the United States Supreme Court in Federal Trade Commission v Cement Institute (1947) 333 US 683. In that case, at p 701, Black J, delivering the judgment of the Court, said:

"In the first place, the fact that the Commission had entertained such views as the result of its prior ex parte investigations did not necessarily mean that the minds of its members were irrevocably closed on the subject of the respondents' basing point practices. Here, in contrast to the Commission's investigations, members of the cement industry were legally authorized participants in the hearings. They produced evidence - volumes of it. They were free to point out to the Commission by testimony, by cross-examination of witnesses, and by arguments, conditions of the trade practices under attack which they thought kept these practices within the ranges of legally permissible business activities. Moreover, Marquette's position, if sustained, would to a large extent defeat the congressional purposes which prompted passage of the Trade Commission Act. Had the entire membership of the Commission disqualified in the proceedings against these respondents, this complaint could not have been acted upon by the Commission or by any other government agency. Congress has provided for no such contingency. It has not directed that the Commission disqualify itself under any circumstances, has not provided for substitute commissioners should any of its members disqualify, and has not authorized any other government agency to hold hearings, make findings, and issue cease and desist orders in proceedings against unfair trade practices. Yet if Marquette is right, the Commission, by making studies and filing reports in obedience to congressional command, completely immunized the practices investigated, even though they are 'unfair', from any cease and desist order by the Commission or any other governmental agency. There is no warrant in the Act for reaching a conclusion which would thus frustrate its purpose."

For completeness we should record that an attempt was made to distinguish the present case from Casey. It was said that, in Casey, an application had been made to the Tribunal, under s.17B of the Act, for it to exercise its substantive powers, whereas in the present case there was no such application. Thus, it was said, the Tribunal in Casey had no option but to conduct an inquiry under s.17C, whereas in the present case there was no obligation to conduct an inquiry, the matter being totally in the discretion of the Tribunal. We have already dealt with that argument.
Orders
We uphold the appeal to the extent of declaring that the purported decision of the Tribunal, dated 24 November 1987, that, in broadcasting the John Laws program on 11, 12, 13, 15, 18, 19, 20 and 23 March 1987 2GB breached RPS 3 upon each of those days, was, so far as that purported decision affected the question of whether the Tribunal should exercise its substantive powers under s.119(1) in respect of Mr Laws of no force or effect. We further declare that the decision of the Tribunal to conduct an inquiry into the question whether the Tribunal should exercise its substantive powers under s.119(1) was null and void, insofar as that decision related to issues 4 and 5 set out in the Notice of Inquiry advertised on 16 December 1987. Otherwise the appeal should be dismissed.
In relation to costs, Mr Laws has succeeded in obtaining a variation in his favour of the orders made by Morling J. But the effect of that variation is merely to make express the understanding which was, in any event, conceded by counsel for the Tribunal before his Honour. The real contest before us related to the question whether or not the Tribunal was precluded from taking any further action in relation to these broadcasts against Mr Laws. Upon that issue Mr Laws has failed. Under these circumstances, it appears to us that justice would be done if both parties were left to bear their own costs of the appeal. We propose to make no order regarding those costs.

[1989] FCA 83

21 MARCH 1989