Link v The Minister for Primary Industries

[2007] NSWSC 1011

CITATION:	Link v The Minister for Primary Industries [2007] NSWSC 1011
HEARING DATE(S):	05/09/2007
JUDGMENT DATE :	11 September 2007
JUDGMENT OF:	Associate Justice Malpass
DECISION:	The Summons is dismissed. The plaintiff is to pay the costs of the Summons.
CATCHWORDS:	Abalone fishery - validity of management charges - statutory construction and jurisdictional error - discretionary defences
LEGISLATION CITED:	Fisheries Management Act 1994 (NSW) Fisheries Management (Abalone Share Management Plan) Regulation 2000 (NSW)
CASES CITED:	Project Blue Sky (1998) 194 CLR 355 SAAP v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 215 ALR 162
PARTIES:	Siegfried Link (Pl) The Minister for Primary Industries (Def)
FILE NUMBER(S):	SC 30079/06
COUNSEL:	Mr R. M. Niall (Pl) Mr M. J. Leeming SC / Ms .A. M. Mtchelmore (Def)
SOLICITORS:	Fitzpatrick Teale (Pl) Crown Solicitor (Def)

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IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

ASSOCIATE JUSTICE MALPASS

11 SEPTEMBER 2007

30079/06 Sigfried Link v The Minister for Primary Industries

JUDGMENT

1 HIS HONOUR: The plaintiff is a fisherman and the holder of seventy shares in the Abalone Fishery (the fishery). The fishery is a share management fishery specified in Schedule 1 to the Fisheries ManagementAct 1994(NSW) (the Act).

2 Since July 2004, the New South Wales Department of Primary Industries (the Department) has had responsibility for New South Wales Fisheries. It took over this role from NSW Fisheries.

3 The Act regulates fishing in the waters of New South Wales. It provides for the making of Share Management Plans. The relevant Share Management Plan is the Abalone Share Management Plan (the plan).

4 The Fisheries Management (Abalone Share Management Plan) Regulation 2000 (NSW) (the Regulation) gives effect to the plan. The plan is an appendix to the Regulation.

5 I shall briefly mention certain of the contents of the plan. Part 1 is headed “Preliminary” and contains definitions. Part 2 is headed “Objectives of Plan” and contains a table with columns dealing with objectives, performance indicators and triggers for review. Part 7 is headed “General” and contains provisions dealing with share forfeiture and “management charge” (clause 36).

6 For the purposes of these proceedings, clause 36 of the plan was as follows:-

“36 Management charge

(1) the management charge payable under section 76 of the Act by shareholders in the fishery is not to exceed $325 per share.

(2) interest is payable on late payments at the rate payable from time to time in respect of judgments of the Supreme Court.

(3) The management charge may, with the approval of the Minister, be paid by instalments on such terms as the Minister approves.”

7 In 2006, clause 36 was amended. The effect of the amendment was to make express provision in respect of the costs of management that were to be attributed to industry. The terms of the amendment are as follows:-

“[3] Appendix, clause 36
Insert after clause 36(1);
(1A) For the purposes of section 76 (2) of the Act, the following costs of management are attributed to industry;
(a) the cost of developing, reviewing, implementing and ensuring compliance with strategies, policies and legislation relating to the fishery (including for the purpose of promoting ecologically sustainable development of the fishery),
(b) the cost of providing administrative services in connection with the operation of the fishery,
(c) the costs incurred in connection with the establishment and operation of the Management Advisory Committee for the fishery,
(d) the costs incurred in connection with the following research (or such part of those costs as the Minister determines):
(i) ongoing research into the management and sustainability of the fishery or of commercial fisheries generally,
(ii) specific research projects relating to the management and sustainability of the fishery or of commercial fisheries generally,
(e) such other costs of management of the fishery as may be determined by the Minister after consultation with the Management Advisory Committee for the fishery.
(1B) The costs of management attributed to industry may be reduced in any manner the Minister considers appropriate to recognise any saving, or any public benefit or benefit to any other fishing sector, that is achieved in the management of the fishery.”

8 The Act confers powers in respect of management charges (s76 thereof).

9 Section 76 appears in Division 7 of Part 3 of the Act. Part 3 is headed “Commercial share management fisheries”. Division 7 is headed “Management charges and community contributions”.

10 The relevant provisions of s76 are as follows:-

“76 Management charges

(1) The Minister may, subject to this section, determine the management charge payable by holders of shares in a share management fishery. The charge is payable annually, or as otherwise determined by the Minister.

(2) The management charge is to be such amount as the Minister considers necessary to meet the costs of management for that fishery, being costs of management that are attributed to industry by the management plan for the fishery.
…
(8) Until the commencement of the management plan for a fishery, the Minister may (after consultation with the Management Advisory Committee for the fishery) determine the matters that may be provided for by the plan.”

11 The plaintiff acquired his shares in about 1999 (prior to the commencement of the plan). He paid in the order of $1,500,000 for his shares and, at the time of the purchase of them, he was aware that the management charge would be in the order of $20,000. The purchase proved to be a poor investment. He says that the shares have become unsaleable. This appears to be a product of events that came to pass in New South Wales.

12 He fell into arrears in the payment of management charges (by about 2003). Thereafter the position deteriorated. By 1 June 2007, the defendant was claiming indebtedness in excess of $56,000.

13 He ascribes this state of affairs to a number of matters. The total allowable catch (see Division 4 of the Act) has been continually reduced in recent years. In the fishing year 2003/2004 it was reduced to 281 tonnes. In the fishing year 2004/2005 it was further reduced to 206. Another reduction for the fishing year 2005/2006 saw it being reduced to 130. The price that he could obtain for his catches of abalone had fallen. He said that the charges came to represent in the order of 30% of his income after paying for diving fees. In addition to these matters, there were diseases affecting abalone in the waters of New South Wales.

14 There were negotiations with the Department (concerning payment by instalments). A proposal put to him in November 2004 was not accepted (the debt was then in the order of $35,000). A payment of $4,550.00 was made in January 2005. A further payment of $9,100.02 was made in May 2005. On 20 June 2005, he agreed to a re-payment schedule (in respect of the amount due at 13 April 2005). It involved the making of six payments, each in the sum of $4,256.93. Earlier, at the beginning of June 2005, he had paid the sum of $4,322.50. It appears that no further payments were made thereafter. The plaintiff says that he was unable to perform that agreement because of a subsequent quota cut (which reduced the total available catch to 130 tonnes per year) in the 2005/2006 period. He now says that he cannot afford to employ a diver in New South Wales. He continues to have a boat in Victoria.

15 On 9 June 2006, the plaintiff filed a Summons in this Court seeking relief in respect of management charges purportedly determined for the years 2000, 2001, 2002, 2003, 2004, 2005 and 2006. He seeks to have the charges declared as being void and of no effect, and further seeks recovery of amounts that have been paid by him after 10 June 2005 in respect of the said years.

16 The proceedings were brought shortly after the plaintiff had received legal advice from his present solicitor (Mr Fitzpatrick).

17 The proceedings came on for hearing on 5 September 2007. The parties were represented by Counsel. Counsel have provided the Court with written submissions. These submissions have been supplemented by oral argument.

18 The plaintiff relied on two affidavits. One was sworn by the plaintiff himself. The other was sworn by Mr Miller. The defendant relies on affidavits sworn by Dianna Watkins (who presently holds the temporary position of Manager, Share Management Implementation for the State of New South Wales Department of Primary Industries). There was cross-examination both of the plaintiff and Dianna Watkins.

19 The plan commenced in 2000. Prior to the commencement thereof, s76(8) enabled the Minister himself to determine the matters that may be provided for by the plan. Following commencement, sub-section (2) thereof came into play.

20 The evidence reveals that the fishing industry involves three sectors. Firstly, there is the commercial fisher (of which the plaintiff is one). Secondly, there is the recreational fisher. Thirdly, there is the illegal fisher.

21 In approaching the task of determining the management charges, the Minister sought the assistance of the Independent Pricing and Regulatory Tribunal (IPART). Following a consultation process, IPART released its report titled “Pricing principles for management charges in New South Wales commercial fisheries” (the IPART report). The Minister has adopted the recommendations and broad pricing principles of the IPART report.

22 In determining the costs of management, the Minister has looked to four categories of costs. Firstly, there are consultation costs. Secondly, there are administration costs. Thirdly, there are research costs. Fourthly, there are compliance costs.

23 The manner of calculation of the management charge is described in the evidence provided by Dianna Watkins. There is a budgetary process. Budgets were prepared in accordance with, inter alia, the objectives set forth in the plan. The costs included in the budgets were grouped in accordance with the four categories. Some of the management costs of the fishery were not included in the budgets. They did not include any provision for work done by Dianna Watkins and other senior officers on strategic planning and resource allocation in relation to the fishery. The Department also bore a proportion of management costs, which fell into an area of “perceived inefficiencies”. What is regarded as costs associated with managing recreational fishers was also borne by the Department. Certain of the costs relating to management of the illegal fishers were also borne by the Department.

24 For the fishing years prior to 2005/2006, the proportion of cost attributed to the recreational sector was 4% of total cost. This approach was based on the IPART report.

25 For the fishing year 2005/2006, there was a change of approach with an amount of 15% of total cost being ascribed to the recreational sector.

26 There are two aspects to the challenge brought by the plaintiff. The first involves a question of construction. The second involves a contention of jurisdictional error.

27 Section 76 enables the Minister to determine the management charges payable by the holders of shares in a state management fishery. The minister is enabled to do so for each fishing period during which the commercial fishing licences of the holders are endorsed to take fish in that fishery.

28 The section prescribes that the management charge is to be such amount as the Minister considers necessary to meet the costs of management for that fishery. There is a further prescription that the management charge is to be costs of management that are attributed to industry by the management plan for the fishery.

29 I observe that the amount of the management charge is not to be equated with actual cost. It is to be such amount as the Minister considers necessary to meet the costs of management. The words “being costs of management that are attributed to industry by the management plan for the fishery” are intended to act in the nature of a definition of what precedes them. It seems to me that the function allocated to the plan by this collocation of words is to identify the costs that are thereby “attributed to industry”. The word “attribute” has the connotation of a quality or characteristic that is ascribed to a person or thing.

30 The Act does not define “industry”. The word appears elsewhere in the Act (see, inter alia, s58). This section is headed “Public and industry consultation”. It may be thought that what is said in ss(2) thereof is indicative of the bodies that may fall within the intended concept of “industry”. In this case, there has been little argument directed to the question of the proper meaning of the word. Largely, the approach has been to treat it as being identifiable with the fishery and its proper meaning did not assume significance in submissions. The amendment purports to address this potential problem.

31 The word “fishery” is defined. Section 6 states that “fishery” means a class of fishing activity. Sub-section (2) thereof provides that, for the purposes of the Act, a fishery may be identified by reference to any one or more of the categories thereafter mentioned. It seems to be common ground that, in this case, it is to be identified by reference to the species or class of fish (abalone).

32 It is common ground that there is no express attribution. The defendant says that the attribution may be effected by implication. It also looks to various of the other observations made by McHugh, Gummow, Kirby and Hayne JJ in Project Blue Sky (1998) 194 CLR 355 at pp 389-391 (inter alia, paragraphs 69-70, 91 and 97). Even if it should fail on all of those arguments, the defendant contends that the relief sought should be refused for discretionary reasons

33 In my view, the attribution may be made either expressly or by implication. By reason of the amendment made in 2006, the attribution now in force is expressly made. There is a commonality between the language of the amendment and what appears in the objectives. The lack of express attribution at the commencement of the plan may have been the result of oversight. Be that as it may, the attribution prior thereto may still be ascertained by what then appeared in clause 36 and elsewhere in the plan.

34 Clause 36 fixes the figure by which the management charge is not to exceed per share ($325.00). Guidance is provided by other provisions of the plan (such as the objectives). In my view, the provisions can be regarded as providing attribution. This was the approach adopted by the Minister.`

35 Following what has been earlier said, it does not seem to me that this is a case where it can be said that the Minister has been in breach of a condition regulating the exercise of the statutory power.

36 However, if a different view were to be taken on that matter, Project Blue Sky establishes that an act done in breach of such a condition is not necessarily invalid and of no effect. Whether it is depends upon whether there can be discerned a legislative purpose to invalidate any act that fails to comply with the condition. The existence of the purpose is to be ascertained by reference to the language of the statute, its subject matter and objects, and the consequences for the parties of holding void every act done in breach of the condition. In my view, such intention is not manifested in this case.

37 There is also the question of public inconvenience. It seems to me that such would be a result if the charges determined prior to the amendment were held to be invalid.

38 I do not accept what was said to be the jurisdictional error arguments. The arguments are put as follows:-

“The Charges are Beyond jurisdiction

45. Alternatively, if it is open to the Minister to attribute costs to industry his decision in each of the years 2000 to 30 June 2006 is void.

46. The management charges arrived at by the Minister involved him applying the IPART formula of 96%/4% with some adjustment in the final year.

47. In doing so, the Minister has made no real attempt to arrive at a figure that reflects the costs properly attributable to industry.

48. Further, the IPART formula:

(a) Was arrived at based on a commercial catch of 335 tonnes; and

(b) A recreational catch of 20 tonnes

49. To carry forward that ratio after the commencement of the Management Plan and without regard to the setting of a (declining) TAC and new data on the size of the recreational sector had the consequence that the Minister failed to take into account:

(a) the reduction in the size of the Total Allowable Commercial Catch in each of the years since 2000

(b) the amount of management time and resources taken up with managing illegal fishing in the abalone fishery; and

(c) the amount of management time and resources taken up with managing the recreational sector of the fishery.

50. Alternatively, the management charge ceased to have a rational connection with the costs of managing the commercial sector. It entailed a massive subsidy by the commercial sector of the recreational sector. By reason of the approach taken the determinations were illogical and not based on probative material.

51. Alternatively, the Minister has applied a policy namely the IPART policy entitled “Pricing Principles for Management Charges in NSW Commercial Fisheries” without regard to the merits of the case. The policy was introduced before the Management Plan came into operation. It did not accommodate the setting of a TACC.

52. Moreover it assumed that the commercial sector and the recreational sector should pay for the entirety of the management of the illegal sector.

53. In arriving at the determinations the Defendant failed to take into account the illegal sector. Alternatively, failed to take in to account a relevant consideration namely the size of the illegal sector and the amount of management time spent managing the illegal sector.”

39 These arguments may be said to fall into two categories. One category concerned the submission that there was a failure to take into account costs relating to illegal and recreational fishers. In my view, the submission is misconceived. I am not persuaded that the Minister should have taken either of them into account. The other category concerned a submission that the power exercised by the Minister had to be exercised in a rational manner. Again, I am not satisfied that it was not so exercised. It seems to me that the plaintiff is seeking a merits review.

40 Leaving those considerations aside, there remains the discretionary defence. As the plaintiff is seeking a discretionary remedy, the relevant considerations to the exercise of that discretion are material. Relevant considerations include delay and inconsistent conduct (SAAP v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 215 ALR 162).

41 In responding to the discretionary matters, apart from taking a stance of general opposition, the plaintiff seeks to distinguish the position of the charge for the 2005/2006 period (it was raised by tax invoice dated 4 April 2006 in the sum of $16,772.00, which was payable by 31 May 2006). He does so on the basis that each charge gives rise to a fresh cause of action.

42 When regard is had to the material before the Court, I do not consider that the charge for that period can be fully distinguished from the other charges. I consider that there has been an acknowledgement of indebtedness in respect of all of the charges. There was inconsistent conduct until shortly before the commencement of these proceedings on 9 June 2006. It was the legal advice received, at or about that time, that saw the plaintiff change his stance. Apart from that conduct, there has been considerable delay in relation to the earlier charges.

43 In the circumstances of this case, even if I had been satisfied that the plaintiff should succeed on other arguments, I would have come to the view that his claim for relief should fail for discretionary reasons.

44 It needs to be added that his claim for re-payment of monies was doomed to failure (as all payments made by him had preceded 10 June 2005).

45 The Summons is dismissed. The plaintiff is to pay the costs of the Summons. Exhibits may be returned.

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