Northern Rivers FM Radio Ltd v The Australian Broadcasting Tribunal
[1990] FCA 340
•12 JULY 1990
Re: NORTHERN RIVERS FM RADIO LIMITED
And: THE AUSTRALIAN BROADCASTING TRIBUNAL and NORTHERN NSW FM PTY LIMITED
No. NG27 of 1990
FED No. 340
Administrative Law
25 FCR 266
COURT
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Einfeld J.(1)
CATCHWORDS
Administrative Law - Whether Tribunal member making the original decision should conduct the review - natural justice - task of the Australian Broadcasting Tribunal - most suitable applicant - nature of a review - apprehended bias
Administrative Decisions (Judicial Review) Act 1977 S 16(1)(d)
Broadcasting Act 1942 SS 83A(4), 83A(9)
HEARING
SYDNEY
#DATE 12:7:1990
Solicitors for the Applicant Blake Dawson Waldron
Counsel and solicitors for Mr D.M. Yates instructed
the First Respondent by the Australian
Government Solicitor
Counsel and solicitors for Mr T.J. Hancock
the Second Respondent instructed by Maxwell
Eyers and Miller Solicitors
ORDER
Order that the member of the First Respondent who made the original decision to be reviewed should not conduct the review.
Order that each party pay its own costs.
Note: Settlement and entry of orders are dealt within accordance with Order 36 of the Federal Court Rules.
JUDGE1
By its amended application seeking an order of review under the Administrative Decisions (Judicial Review) Act 1977 (the ADJR Act), the applicant sought a review of a decision of the Australian Broadcasting Tribunal (the Tribunal) made on 18 December 1989 that a commercial FM radio licence be granted to Northern NSW Pty Ltd (the licensee) and not the applicant. The licence was to operate for five years in Lismore and surrounding areas. Prior to the hearing the parties agreed to the order of review, but the applicant sought an additional order that the member of the Tribunal who had made the original decision to be reviewed should not conduct the review on the ground of apprehended bias. The argument was that he had made a decision of fact that has been quashed, and that in the context and circumstances, natural justice requires that another member sit on the review on the ground that there had been a pre-determination of all or some of the issues which the review would have to consider. There was no dispute that under section 16(1)(d) of the ADJR Act the Court has jurisdiction to grant the order sought. Nor was there any suggestion that the Tribunal member is in fact now unable to give a fair or just decision, merely that a reasonable person may entertain a suspicion that he may not bring an unbiased mind to his task such that his determination might lack public and legal integrity.
The task performed by the Tribunal in the original hearing, and to be performed on the review, is defined by section 83A of the Broadcasting Act 1942, especially subsections (4) (in part) and (9). These are as follows:
(4) The Tribunal shall refuse to grant a commercial licence to a person if it appears to the Tribunal, having regard only to the following matters or circumstances, that it is advisable in the public interest to refuse to grant the licence to the person:
(a) the Tribunal is not satisfied that the person:
(i) is a fit and proper person to hold the licence;
(ii) has the financial, technical and management capabilities necessary to provide an adequate and comprehensive service pursuant to the licence; and
(iii) is otherwise capable of complying with the conditions of the licence;
(b) if the licence's service area:
(i) is not a metropolitan service area; and
(ii) overlaps the service area of at least one other commercial licence whose service area is also not a metropolitan service area;
the need to avoid undue concentration of
influence, whether direct or indirect, on
the person and on the corporation or
corporations holding the other licence or
licences;
(c) where the service area of the licence overlaps the service area
of another nonlimited licence or other non-limited` licences - the need for the commercial viability of the service or services provided pursuant to the other licence or other licences.
(9) Subject to subsection (10), where there are 2 or more applicants for a commercial licence, each of whom is a person to whom, but for this subsection, the Tribunal would be required to grant the licence, the Tribunal shall grant the licence to the most suitable applicant.
The "most suitable applicant" for the licence as determined by the Tribunal will then be the licensee subject to some technical requirements including the payment of the licence fee. As the Tribunal was satisfied in this case that both the applicant and the licensee met the requirements of section 83A, there devolved upon the Tribunal the task of determining the "most suitable" of them. In this regard, the Tribunal stated that the applicant was "not preferred" for the reasons set out in paragraphs 4.67 to 4.70 of its determination. These were as follows:
4.67 As Northern Rivers has still to issue a
significant proportion of its proposed issued shares, there is a degree of uncertainty regarding the final identity of the company and its Board. The Tribunal is satisfied that the shareholding and Board as currently constituted meets the requirements of section 83A. However, the fact that the identity of a large proportion of the shareholding is unknown and that there can be no degree of certainty that future shareholders will not be in a position to demand a seat on the Board, it is obviously difficult for the Tribunal to make firm judgements (sic) as to the applicant's fitness and propriety, despite the assurances given by Mr Haly.
4.68 Coupled with this are the Tribunal's
concerns that the Board displayed a lack of cohesion on significant management decisions and is dependent upon the expertise of its consultants, Messrs Hincks and Heming, and its ability to appoint a chief executive who possesses a range of experience currently not represented on the Board.
4.69 Northern Rivers has based its choice of
target audience and program format on a largely subjective and superficial understanding of the needs and interests of the service area population. The limited professional research commissioned by the applicant is also flawed due to its extremely small sample size and the unrepresentative nature of that sample. As indicated earlier, the Act requires applicants to ascertain the diversity of needs and interests in the community to be served.
4.70 In addition to this, Northern Rivers quite
clearly has no intention or commitment to providing a service complementary to existing services in the service area and has put together a programming proposal which largely duplicates the service provided by 2LM. In view of this, the Tribunal has little confidence that the Northern Rivers programming proposal would lead to the provision of an adequate and comprehensive service. The Tribunal is also concerned that Northern Rivers' conservative expenditure and staffing proposals may not be adequate for the provisions of such a comprehensive programming strategy.
On the other hand, the Tribunal found in relation the licensee as follows:
5.59 The Tribunal is satisfied that N-NSW
fulfils the requirements of s81AA(1) and s.83A of the Broadcasting Act 1942. The Tribunal finds that N-NSW is the most suitable of the two applicants for the following reasons.
5.60 The Tribunal has a greater degree of
certainty about the identity of the applicant due to the advanced stage of the share issue, despite the doubts raised by 2LM's and Northern Rivers in relation to 2LM continued presence as a share holder. The N-NSW Board possesses a greater range of broadcasting and management skills appropriate to the operation of commercial radio station, though, as stated earlier, the Board would have been further strengthened if it had access to sales, marketing and technical expertise at Board level, as well as through consultants and professional staff.
5.61 The N-NSW Board is well balanced and
cohesive, is not dependent upon a single director for broadcasting expertise and was not significantly dependent on any of its consultants. It is a stable Board with each of the major shareholding interests represented and a management plan designed to make effective use of expertise on the Board. Like Northern Rivers, the N-NSW has strong ties on a number of levels with the local community.
5.62 N-NSW has proposed a reasonably typical
target audience and program format for a commercial FM station, however, this choice is clearly based upon a professional and objective examination of the needs and interests of the service area population. While the Tribunal has identified some shortcomings with this research, it is satisfied that the research does confirm a need and interest in a predominantly music oriented format to serve the under 35 age-group.
5.63 Of the two applicants N-NSW has produced
the more professional and well research application and demonstrated a greater commitment to ascertaining the needs and interests of the community to be served. The Tribunal, therefore, has greater confidence in N-NSW's ability to provide an adequate and comprehensive service.
If it could be regarded as necessary, there was a consideration of the meaning of the concept of "most suitable applicant" by Wilcox J in Our Town FM Pty Ltd v. Australian Broadcasting Tribunal and Another (No 1) (1988) 77 ALR 577 at 594.21:
The Act does not specify the criteria to be adopted by the tribunal in determining which applicant is the "most suitable". The situation is one to which may be applied the principle stated by the High Court in R v Australian Broadcasting Tribunal; Ex parte 2 HD Pty Ltd (1979) 144CLR 45 at 49; 27 ALR 321 at 325: "the discretion is 'unconfined except in so far as the subject-matter and the scope and purpose of the statutory enactments may enable the court to pronounce given reasons to be definitely extraneous to any objects the legislature could have had in view'." The Tribunal would be entitled, if it so chose, to take into account all the matters raised by s 83(6), selecting as the most suitable applicant that company which impressed most over the whole range of these matters. Alternatively, it could select a particular aspect of the relevant service - for example, news coverage, local content or target audience - which it thought to be particularly important in connection with that licence and judge to be the "most suitable" that applicant which best dealt with that aspect.
By these criteria with which I respectfully agree, the Tribunal clearly gave a fair and relevant consideration of what seems to be all or a balanced selection of the relevant issues.
The nature of a rehearing or review in matters such as this was considered in Our Town FM Pty Ltd v. Australian Broadcasting Tribunal and Another (No 2) ibid at 606.34 where Wilcox J. said:
The application of the principles enunciated in Peko - Wallsend leads inexorably to the conclusion that, before making its final decision upon the grant of the subject licence, the tribunal is bound to take into account, first, any facts which have arisen since its previous consideration in April and, secondly, any matters put before it which serve to "correct, update or elucidate" anything which it may have said in its earlier report. In saying this, of course, I refer only to material which is, at least prima facie, reliable material upon a question relevant for its consideration in making its final decision; but it is not suggested that any of the material as to new events or to correct misunderstandings is either unreliable or irrelevant.
The law relating to apprehended bias in relation to tribunals of this kind is well settled. In The Queen v The Commonwealth Conciliation and Arbitration Commission and Others; Ex parte The Angliss Group (1969) 122 CLR 546 at 553-4, the High Court defined the concept as follows for the then Conciliation and Arbitration (now Industrial Relations) Commission:
It is plain that when it is necessary to consider a question of fairness in relation to a tribunal the whole of the circumstances in the field of the inquiry are of importance. The nature of the jurisdiction exercised and the statutory provisions governing its exercise are amongst those circumstances. It is therefore important to bear in mind that the Commission does not sit to enforce existing private rights. Amongst other things, it is its function to develop and apply broad lines of action in matters of public concern resulting in the creation of new rights and in the modification of existing rights. It is not necessarily out of place, and indeed it might be expected that a member of the Commission from time to time in the course of discharging his duties should express more or less tentative views as to the desirability of change in some principle of wage fixation. The very nature of the office of a member of the Commission requires that he should apply his mind constantly to general questions of arbitral policy and consider the lines along which the processes of conciliation and arbitration for the prevention and settlement of industrial disputes ought to move. But allowing for considerable scope for the formation and expression of opinion upon such matters of public interest and concern, it should not be forgotten that the confidence with which the Commission and its decisions ought to be regarded and received may be undermined, as much as may confidence in the courts of law, by a suspicion of bias reasonably - and not fancifully-entertained by responsible minds.
The "reasonable person" was said in Livesey v. The New South Wales Bar Association (1983) 151 CLR at 298-9 to be ascertained in this way:
It was submitted on behalf of the Association that a reasonable observer would be aware of the ability of any judge of the Court of Appeal to put from his mind evidence heard and findings made in a previous case and to decide the case at bar impartially and fairly on the evidence led in that particular case. As we have already indicated however, we do not consider that a case such as the present is to be resolved by reference to the ability of the members of a particular court or the public confidence in the integrity of the judiciary. What is in issue in the present case is the appearance and not the actuality of bias by reason of prejudgment. The reasonable observer is to be presumed to approach the matter on the basis that ordinarily a judge will so act as to ensure both the appearance and the substance of fairness and impartiality. But the reasonable observer is not presumed to reject the possibility of prejudgment or bias; nor is the reasonable observer presumed to have any personal knowledge of the character or ability of the members of the relevant court.
And in Vakauta v. Kelly (1989) 87 ALR 633 at 645.50 Toohey J, when a member of this Court, referred to an incisive dictum of Kirby P in S and M Motor Repairs Pty Ltd v. Caltex Oil (Australia) Pty Ltd (1988) 12 NSWLR 358 at 375-6 as to the level of sophistication that should be attributed to the reasonable or fair minded observer. In relation to whether a Judge should sit to hear a case involving a party for whom the Judge had previously acted while at the Bar, Kirby P wrote, concerning the criteria for establishing the attributes and attitudes of this observer:
The Dialogue of citizens:
Since writing the above, I have read with admiration the way in which Priestley and Clarke JJA have explained the path by which they come, on the same facts, to the opposite conclusion.
I would only observe that the second citizen to whose fictional conversation their Honours refer, has had imputed to him (or her) a sophistication and knowledge about the law and its ways which I believe to be quite atypical of the general community. The dialogue, with every respect, strikes me as more reminiscent of the hushed tones and cloistered atmosphere of a Bar common room or judicial luncheon table than the robust discussion between ordinary reasonable citizens on the Emu Plains omnibus. The knowledge of the second citizen about legal retainers, in particular, goes far beyond (as I would suggest) the knowledge of the imputed reasonable person. Moreover, the second citizen has to work rather hard to bring his more typical and even stubborn conversationalist any distance towards his opinion. And in the end, as I read the dialogue, he does not succeed. It is not necessary, by the applicable principles of law as I apprehend them, to engage in such a painstaking process of argument, cajoling and persuasion of that which should, to the reasonable observer, be manifest. The fast-talking second citizen may not be nearby. Instead, there may be reasonable but anxious citizens who, faced with such a situation, are likely to conclude:
"We just don't like it. Here is a small trader. There is a large petrol company seeking to exert its commercial will and using contempt proceedings. The judge has had a long and recent connection with the company. So he would know the way the petrol company operates. Maybe he even advised them on these sorts of franchise agreements. It's just not fair. The traders may be in contempt. But it's a very serious charge, after all. They may even go to gaol for it. That makes it very important that the judge should have disclosed his long connection with the petrol company at the beginning. They were at least entitled to that. We just don't feel easy about it. Better have it done again. At least that way justice will be seen to be done. Didn't someone once say that about our system?"
In the interests of brevity, I do not set out the hypothetical conversation constructed by Priestley and Clarke JJA. It will suffice to say that I agree entirely with Kirby P's strictures and views about it, but I must confess to holding some reservations about a small clutch of elite lawyers such as the judiciary being in a position to speculate with accuracy on the likely conversations of public transport patrons. Those who live in Emu Plains might anyway prefer trains to buses, at least for journeys long enough to entice them to engage in deep philosophical contemplations of the kind in which their Honours indulged so learnedly. I forbear from adding my suggestion as to the likely conversation; apart from other reasons, I am doubtful that the publishers of law reports would print the language. See also Wattmaster Alco Pty Ltd and Others v. Button (1986) 13 FCR 253.
In Kaycliff Pty Ltd and Others v. Australian Broadcasting Tribunal and Another (1989) 90 ALR 310 at 317.44, a Full Court of this Court referred to R v Australian Stevedoning Industry Board; Ex parte Melbourne Stevedoning Co Pty Ltd. (1953) 88 CLR 100 at 116 where Dixon CJ, Williams Webb and Fullagar JJ wrote:
But when bias of this kind is in question, as distinguished from a bias through interest, before it amounts to a disqualification it is necessary that there should be strong grounds for supposing that the judicial or quasi-judicial officer has so acted that he cannot be expected fairly to discharge his duties. Bias must be 'real'. The officer must so have conducted himself that a high probability arises of a bias inconsistent with the fair performance of his duties, with the result that a substantial distrust of the result must exist in the minds of reasonable persons. It has been said that 'preconceived opinions - though it is unfortunate that a judge should have any - do not constitute such a bias, nor even the expression of such opinions, for it does not follow that the evidence will be disregarded.
In the light of these statements of principle, the applicant cited five distinctive features of this case which it says supports the order sought:
1. The competitive element involved between
the applicant and the licensee
2. The fact that the Tribunal determines the
elements of the dispute
3. The adversarial nature of the Tribunal's
procedures
4. The fact that there was consent to the
review on the ground of legal error
5. The Tribunal's original findings
concerning the applicant contain
impressionistic concepts which while not
defined exactly as issues of credit are
closely akin to such issues and resulted
from factual determinations requiring at
least a subjective qualitative evaluation
of the applicant's evidence. Examples
given included the Tribunal's comments on
the cohesiveness of the applicant's Board
of Directors, the Tribunal's apparent
rejection or diminished acceptance of the
applicant's undertakings to it, especially
regarding its shareholding, and the
Tribunal's conclusion that the applicant
will have to rely on the expertise of
experienced professionals and consultants
for its management decisions.The Tribunal appeared before me to put some general submissions on the law relating to the way to approach such cases, but did not put a substantive submission. It said that it would not be embarrassing or problematic for the Tribunal whichever way this decision went. However, the licensee argued that this was demonstrably a decision made on the facts without the need to express a view on the credibility or credit worthiness of anyone. Taking up the view of the majority of S and M Motor Repairs Pty Ltd (supra) that the "reasonable observer" is the "informed" observer, the licensee argued that no such person could suspect a real likelihood of bias in this case.
On an issue which can credibly be argued either way, I am of the view that the applicant's arguments should prevail. The original determination demonstrates that the Tribunal's consideration of the matter was extensive, far reaching and lengthy. It seems to me unlikely that the member concerned would not have formed some views in the matter concerning the personalities involved and their competence and acceptability. These are among the key issues which the Broadcasting Act requires to be found before a licence is granted.
Indeed, the trenchancy of the Tribunal's conclusions on the applicant's statutory qualifications make doubtful how it could have found the applicant to be suitable for a licence at all. It is difficult to see how a reasonably perceptive outsider would fail to doubt that the writer of those words could be fully objective in a reconsideration of the same matters.
I think that there must be entertained a reasonable suspicion that a fully detached determination could not be made by the same person who formed such strong views on the applicant's compliance with the requisite criteria. I therefore accede to the applicant's application. In the circumstances I think that each party should pay its own costs.
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