Real Estate Institute of Western Australia Inc v Kobelke - [2002] WASC 281

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL

CITATION: REAL ESTATE INSTITUTE OF WESTERN AUSTRALIA INC -v- KOBELKE & ORS [2002] WASC 281

CORAM: PULLIN J

HEARD: 19 NOVEMBER 2002

DELIVERED : 27 NOVEMBER 2002

FILE NO/S: CIV 1662 of 2002

BETWEEN: REAL ESTATE INSTITUTE OF WESTERN AUSTRALIA INC
Plaintiff
AND
JOHN C KOBELKE
First Defendant
JAMES A MCGINTY
Second Defendant
GEOFFREY I GALLOP
ERIC S RIPPER
KIM H CHANCE
TOM G STEPHENS
JUDY M EDWARDS
MICHELLE H ROBERTS
ALANNAH MACTIERNAN
CLIVE M BROWN
ALAN J CARPENTER
SHEILA M MCHALE
ROBERT KUCERA
NICHOLAS D GRIFFITHS
JOHN C KOBELKE
JAMES A MCGINTY
Third Defendants

Catchwords:

Constitutional law - The Crown - Governor - Whether Executive Council may advise the Governor not to appoint the nominee of REIWA to the Real Estate and Business Agents Supervisory Board

Legislation:

Constitution Act 1889 (WA), s 74

Dairy Produce Act 1986 (Cth), s 32(1)
Gas Pipelines Access (Western Australia) Act 1998, s 28
Interpretation Act 1984 (WA), s 60

Real Estate and Business Agents Act 1978 (WA), s 6, s 7, s 8

Result:

Declaration made

Category: A

Representation:

Counsel:

Plaintiff:     Mr M J McCusker QC & Mr P G Donovan
First Defendant             :     Mr G T W Tannin SC & Ms S T Gorman
Second Defendant         :     Mr G T W Tannin SC & Ms S T Gorman
Third Defendants          :     Mr G T W Tannin SC & Ms S T Gorman

Solicitors:

Plaintiff:     McCallum Donovan Sweeney
First Defendant             :     State Crown Solicitor
Second Defendant         :     State Crown Solicitor
Third Defendants          :     State Crown Solicitor

Case(s) referred to in judgment(s):

Attorney‑General (NSW) v Quin (1990) 170 CLR 1
FAI Insurances Ltd v Winneke (1982) 151 CLR 342
L'Huillier v The State of Victoria, unreported; Court of Appeal; SCt of Vic; 14 December 1995
Marks v The Commonwealth (1964) 111 CLR 549
Marquet v Attorney‑General of Western Australia [2002] WASCA 277
Sykes v Cleary (1992) 176 CLR 77
Tonkin v Brand [1962] WAR 2

Case(s) also cited:

Dallikavak v Minister for Immigration & Ethnic Affairs (1985) 61 ALR 471
Stock v Grubb (1985) 39 SASR 1
Tew v Harris (1847) 116 ER 376
Thompson v Goold & Co [1910] AC 409

PULLIN J: The question to be answered is whether or not the Executive Council of the Government of Western Australia was obliged to recommend that the Governor appoint to the Real Estate and Business Agents' Supervisory Board, the nominee of the Real Estate Institute of Western Australia ("REIWA") pursuant to s 7(1)(d) of the Real Estate and Business Agents Act 1978 (WA) ("Act").
Section 6 of the Act provides that for the purposes of the Act there should be a Board to be known as the Real Estate and Business Agents Supervisory Board ("the Board").
Section 7 of the Act provides:
" (1) Subject to this section, the Board shall consist of 5 members appointed by the Governor of whom -
(a)one, being a person who is not a licensed agent, shall be appointed to be a member and Chairman of the Board;
(b)one, being a person who is not a licensed agent, shall be a person who is experienced in commercial practice;
(c)one, being a person who is not a licensed agent, shall be a person who is a legal practitioner;
(d)one shall be a person who is a licensed agent nominated for appointment by The Real Estate Institute of Western Australia; and
(e)one shall be a person who is a licensed agent and elected for appointment by licensed agents (hereinafter called an elective member).
(2)Prior to the first occasion on which an appointment is to be made to the office of a member referred to in subsection (1)(d), and on each occasion thereafter when such office becomes vacant, the Minister shall, in writing, request The Real Estate Institute of Western Australia to nominate to him in writing the name of a licensed agent who is willing to act as a member of the Board.
(3)Where a request has been made pursuant to subsection (2) the Minister may, if nomination is not made pursuant to that subsection within 21 days of the request being made, nominate for appointment to the office such licensed agent as the Minister thinks fit.
[(4) Omitted under Reprints Act 1984 s. 7(4)(e)]
(5)The Minister shall appoint a returning officer for each election of an elective member.
(6)The election of an elective member shall be held and conducted in such manner and at such times as may be prescribed.
(7)The expenses incurred in connection with the election of an elective member shall be paid out of the moneys appropriated by Parliament for the purposes of this Act.
(8)The Governor may appoint as deputy of a member a person who has the like prescribed qualifications as those of the member and, where the case requires, who has been nominated or elected in the manner in which the member was nominated or elected. …"
Section 8 of the Act provides:
"(1) Subject to this Act, each elective member shall hold office for a period of 4 years and is eligible for re-election and reappointment, and each member who is not an elective member shall hold office for such period not exceeding 4 years as is specified in the instrument of his appointment and is eligible for reappointment.
…
(3)The Governor may terminate the appointment of a member for inability, inefficiency, or misbehaviour.
(4)If a member of the Board ¾
(a)is an undischarged bankrupt or a person whose property is subject to an order or arrangement under the laws relating to bankruptcy;
(b)becomes permanently incapable of performing his duties as a member;
(c)resigns his office by writing under his hand addressed to the Minister;
(d)absents himself, except on leave duly granted by the Minister from meetings of the Board for a period exceeding 8 weeks; or
(e)ceases to hold any qualification required for his becoming or being a member,
the office of that member becomes vacant.
(5)Where the office of a member has become vacant otherwise than by effluxion of time, the Governor may appoint to the vacant office for the unexpired part of the term of the office which so became vacant a person who has the like prescribed qualifications, if any, as those of the member whose office has become vacant, and, where the case requires, who has been nominated or elected in the manner in which the member was nominated or elected."
The first defendant was at all material times the Minister to whom administration of the Act was committed and the Minister referred to in s 7(2) of the Act.
On 30 November 2001, the office of the person appointed pursuant to s 7(1)(d) fell vacant. In anticipation of that event, the Minister wrote to REIWA noting that the office of its nominee would become vacant on 30 November 2001 and requesting REIWA to supply a "panel of names of licensed agents" from which the vacancy could be filled.
Following receipt of the Minister's letter, REIWA resolved that the REIWA nominee would be Mr Hoad, who was at all material times a licensed agent, willing to act as a Board member, and by letter dated 9 November 2001, REIWA informed the Minister that he was REIWA's nominee.
The Minister replied by letter dated 15 November 2001, repeating his request that REIWA provide a panel of names. REIWA replied, by letter dated 19 November 2001, pointing out that the nomination of Mr Hoad as the REIWA nominee was the result of a ballot conducted by REIWA's council and that the Act did not entitle the Minister to require REIWA to provide a "panel of names" from which the Minister could make a selection.
By letter dated 29 November 2001, the Minister replied, stating that he would not be forwarding the nomination of Mr Hoad to Cabinet for endorsement, but notwithstanding that letter the Minister has since forwarded advice of REIWA's nomination to Executive Council and to the Governor. Executive Council has advised, and recommended to, the Governor that REIWA's nominee, Mr Hoad, not be appointed to the Board. The Governor, acting in accordance with that advice, decided not to appoint Mr Hoad to the Board. The Governor's decision was made on 19 March 2002.
The plaintiff therefore seeks a declaration that upon receipt of REIWA's nomination of Mr Hoad as the REIWA nominee to the Board, the Executive Council was obliged to advise the Governor to appoint him as a member of the Board.
I should begin consideration of this claim for relief by noting that when in s 7 and s 8 of the Act there is a reference to the Governor making an appointment, this must be taken to mean that such appointment should be made by the Governor with the advice and consent of Executive Council: see s 60 of the Interpretation Act 1984 (WA). Wilson J said in FAI Insurances Ltd v Winneke (1982) 151 CLR 342 at 396:
"… the Governor in Council is not a deliberative body. It is no more than a formal stage in the process whereby decisions of Ministers and the government are transformed into effective decisions."
And as Brennan J said at 415:
"… a decision made by a Governor in Council is no more than the formal legal act which gives effect to the advice tendered to the Crown by its Ministers …"
What is therefore under consideration in this case, is the advice tendered by Executive Council. If there is a dispute about whether Executive Council has advised the Governor to make a decision which is contrary to law, then the courts may declare the law: Tonkin v Brand [1962] WAR 2 at 15, Marquet v Attorney‑General of Western Australia [2002] WASCA 277 at [20] and [134] and Marks v The Commonwealth (1964) 111 CLR 549 at 565. This explains why the members of Executive Council are named as third defendants.
The short point involved is whether the provisions of s 7(1)(d) of the Act allow Executive Council to advise the Governor to appoint or not appoint REIWA's nominee as the defendants contend, or whether the Executive Council was obliged to advise the Governor to appoint the nominee as the plaintiff contends.
The plaintiff argues that once the REIWA nomination was made, Executive Council must recommend the appointment of the nominee and in consequence the Governor must make the appointment of that nominee to the Board. The plaintiff submits that the Executive Council has no discretion to recommend refusal, because there is no provision for a repeat of the process.
The plaintiff also submits that if it had been intended by Parliament that there should be a discretion to recommend acceptance or rejection of REIWA's nomination, it would have been a simple matter for Parliament to have said so. The plaintiff points to two examples of drafting which might have been employed. It refers to provisions in the Gas Pipelines Access (Western Australia) Act 1998, which provides for the appointment of a Regulator by the Governor. Section 28(7) authorises the Commissioner to nominate a person or persons suitable for appointment, which nomination or nominations must be forwarded to the Minister. Section 28(8) provides that if the Minister accepts the person or one of the persons nominated by the Commissioner, the Minister is to recommend to the Governor that the person accepted be appointed.
Section 28(9) provides that:
"If the Minister rejects the person, or both or all of the persons, nominated by the Commissioner, the Minister may request the nomination of another person by the Commissioner and is to deal with any further nomination as if it were made under subsection (7)."
The plaintiff also points to Commonwealth legislation and in particular the Dairy Produce Act 1986 (Cth) in which s 32(1) provides:
"If the Minister is not satisfied as to the suitability of a person nominated for appointment, the Minister may, by notice in writing given to the Committee, reject the nomination and may, in that notice, ask for a further nomination."
The plaintiff also submits that the purpose of s 7 of the Act would be defeated by accepting the defendant's contention. The plaintiff submits this would be so because it says the "purpose" of s 7 is to avoid the membership of the Board reducing to less than five.
The defendants, as I have said, submit that the Executive Council has a discretion to recommend the appointment or non‑appointment of the REIWA nominee. The defendants submit that the nomination by REIWA is merely a qualification for appointment. That is, the identification of a person eligible for appointment. The defendants refer to the ordinary meaning of "nominate" as meaning "to propose as a proper person for appointment or election to an office", "Macquarie Dictionary", 3rd Ed. I agree that the word does have that meaning in s 7 of the Act, but that does not help answer the question at hand. The question to be answered concerns the power of appointment. The defendants contend that if the Governor, acting on advice of Executive Council, refuses to appoint REIWA's nominee, then the process can be repeated and ultimately a REIWA nominee would be appointed.
Section 7(1) of the Act does not expressly confer power on the Governor to make the appointments. The section states that the Board shall consist of five members "appointed by the Governor". There is no provision expressly stating what the nature of the power of the Governor is to be in relation to appointments made under s 7(1). This is in contradistinction to s 7(8), which reads:
"The Governor may appoint as deputy of a member …"
That latter provision being in the active voice, makes it clear that the Governor, with the advice and consent of Executive Council, has a discretion. It is my view, although it is not necessary to decide it in this case, that Executive Council may recommend the appointment of a Deputy or may recommend that no deputy be appointed. While there is no express provision in s 7(1)(d) of the Act, it nevertheless clearly implies that the Governor in Executive Council has the power of appointment. There is no express indication whether Executive Council is obliged to advise the Governor to appoint REIWA's nominee or whether it is free to recommend that the Governor refuse to make such appointment.
Parliament has recognised in s 60 of the Interpretation Act 1984 (WA) that on some occasions a statutory requirement that the Governor in Council act in a particular way will confer a discretion and sometimes it will not. Section 60 reads:
"Where in a written law the Governor is authorized or required to do any act, matter, or thing, it shall be taken to mean that such act, matter, or thing may or shall be done by the Governor with the advice and consent of the Executive Council."
The question is whether in the case of s 7(1)(d) of the Act the Governor, with the advice and consent of Executive Council, is "required" to appoint REIWA's nominee or whether he is merely "authorised" to do so, meaning that Executive Council may choose to advise the Governor to appoint the nominee or not.
As I have said already, s 7 of the Act does not expressly state what power the Governor has in this case. Parliament's intention must therefore be ascertained from the words of the section read as part of the statute as a whole.
The office of member of the Board is a "public office": Sykes v Cleary (1992) 176 CLR 77 at 96. Originally, persons were appointed to public office by the Crown under the prerogative: see LBC, "The Laws of Australia", vol 19 at 19.3 [34]. This authority of the Crown, which existed at common law, was vested in the Governor in Council under s 74 of the Constitution Act 1889 (WA). In Attorney‑General (NSW) v Quin (1990) 170 CLR 1 at 33, Brennan J said:
"Except where the power of appointment to a public office is governed by statute, the power must be at large if its exercise is to answer the purpose for which it is conferred, namely, to advance the interests of the public. If the power is conferred by statute but the statute prescribes no procedure for the making of appointments nor any criteria governing the exercise of the power, the power must be at large for the same reason. The Executive Government … is entrusted with authority to decide who is best fitted to fulfil the duties of the office"
In this case, the power is conferred by statute and the statute provides criteria governing the exercise of the power.
Section 7(1) of the Act requires the Governor, with the advice of Executive Council, to make an appointment of five members to the Board. There is no discretion as to the number to be appointed. Executive Council is therefore obliged to advise the Governor to exercise his power to appoint five members. There follows in s 7(1) the criteria which govern the exercise of this power in relation to each member. The criteria all relate to the qualifications which potential appointees must have before the appointment can be made.
In the case of s 7(1)(a), the only qualification is that the person is not a licensed agent. Thus, in relation to this appointment, the Executive Council "is entrusted with authority to decide who is best fitted to fulfil the duties of the office" save only that Parliament has confined that authority so that persons who are licensed agents may not be appointed.
In relation to s 7(1)(b), Executive Council can recommend the appointment of anyone it pleases, providing the person is not a licensed agent and providing that person is experienced in commercial practice. There is a wide but more confined discretion than in the case of s 7(1)(a) appointees.
Under s 7(1)(c), Executive Council may recommend the appointment of anyone it pleases, providing the person is not a licensed agent and providing the person is a legal practitioner. Executive Council in this case is much more confined in the recommendation it may make.
In the case of s 7(1)(d), there is no discretion at all if REIWA nominates only one person who is a licensed agent. If there is only one licensed agent nominated by REIWA, then that is the only person who Executive Council may recommend be appointed. As there must be five members appointed, Executive Council must recommend the appointment of REIWA's nominee unless there is some other implied authority to recommend that the nominee not be appointed.
In my opinion, there is no such implied authority. Parliament intended that the member appointed under s 7(1)(d) should be a nominee of REIWA. Parliament did not give any indication that the Governor, with the advice of Executive Council, was to have any discretion to refuse to appoint the single nominee of REIWA. The defendants submit that the discretion is necessary for "public policy" reasons. The defendants submit that public policy requires that Executive Council should not be obliged to recommend the appointment of a person it considers to be unsuitable. In my opinion, there is no such public policy requirement. Parliament has itself spelled out circumstances which it considers would make a person unsuitable for office in s 8(4) of the Act. That being so, there is no basis for any implication that Executive Council should have a discretion to refuse to appoint a nominee because of some other circumstance not specified by Parliament. The defendants refer to L'Huillier v The State of Victoria, unreported; Court of Appeal; SCt of Vic; 14 December 1995, where Brooking JA said of the statutory provision under consideration in that case:
"The power of appointment conferred by s 15(2) is contained in a statute which prescribes no criteria governing the exercise of the power. The power must be at large if its exercise is to answer the purpose for which it is conferred - to advance the public interest. The Governor in Council is entrusted with authority to decide who is best fitted to fulfil the duties of the office."
The fact that the provision in that case contained no criteria governing the exercise of the power of appointment distinguishes it from this case.
I should add that, in my opinion, REIWA may choose to nominate a panel of persons, one of whom may be appointed. This is because s 7(1)(d) authorises the appointment of "a" person nominated by REIWA rather than "the" person nominated by REIWA. However, REIWA is not obliged to nominate a panel of potential appointees.

In the absence of a provision of the kind referred to by the plaintiff, and to be found by way of example in the Gas Pipelines Access (Western Australia) Act 1998 and the Dairy Produce Act 1986 (Cth) provisions referred to above, it is my view that Executive Council was, and is, obliged to recommend the only person qualified for appointment, namely Mr Hoad, who is a licensed agent and who is nominated by REIWA. As a result, I will make the declaration sought by the plaintiff.