Whim Creek Consolidated N.L. v Colgan, G

[1989] FCA 387

Re: WHIM CREEK CONSOLIATED N.L.
And: GREGORY COLGAN
No. WA G14 of 1989
FED No. 387
Administrative Law - Practice and Procedure
88 ALR 83
25 FCR 50

COURT

IN THE FEDERAL COURT OF AUSTRALIA

WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
Lee J.(1)

CATCHWORDS

Administrative Law - whether inadequate weight can form the basis of an order of review.

Practice and Procedure - whether Court has power to strike out paragraphs of an application for an order of review pursuant to the Administrative Decisions (Judicial Review) Act 1977.

Administrative Decisions (Judicial Review) Act 1977, ss.5, 6; sub-s.5(1); paras.5(2)(g), 5(2)(j), 11(1)(a)

Customs Act 1901, s.203

Federal Court Rules, O.1 r.4, O.10 r.1, O.10 r.1(2)(a), O.10
r.1(2)(v), O.10 r.1(2)(x), O.11 r.16, O.20 r.2, O.54 r.1, O.54 r.5, O.54 r.6, O.54 r.7

General Steel Industries Incorporated v. Commissioner for Railways (NSW) (1964) 112 CLR 125

Hughes Motor Services Pty. Ltd. v. Wang Computer Pty. Ltd. (1978) ATPR 40-098

Merman Pty. Ltd. v. Cockburn Cement Ltd. (1988) 54 ALR 521

Minister for Aboriginal Affairs v. Peko-Wallsend Ltd. (1986) 162 CLR 24

Sean Investments Pty. Ltd. v. MacKellar (1982) 42 ALR 676

Sordini v. Wilcox (1983) 70 FLR 326

Tabag v. Minister for Immigration and Ethnic Affairs (1982) 45 ALR 705

Western Television v. Australian Broadcasting Tribunal (1986) 69 ALR 465

HEARING

PERTH

#DATE 18:7:1989

Counsel for the Applicant: Dr J.T. Schoombee

Solicitor for the Applicant: Bennett & Co.

Counsel for the Respondent: Mr P. Macliver

Solicitor for the Respondent: Australian Government Solicitor

ORDER

The respondent's motion be dismissed.

The respondent pay the applicant's costs of the motion.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

JUDGE1

On 10 January 1989 the respondent, an investigation officer employed in the Australian Customs Service, issued a notice of seizure of goods pursuant to s.203 of the Customs Act 1901 and seized goods owned by the applicant.

1. Pursuant to ss. 5 and 6 of the Administrative Decisions (Judicial Review) Act 1977 ("the ADJR Act") the applicant has sought an order of review of the respondent's decision.

2. The respondent has applied to strike out the following sub-paragraphs of the applicant's application for an order of review on the ground that these sub-paragraphs disclosed no reasonable basis for the application. (See Federal Court Rules O.54 r.6.) The sub-paragraphs were included as part of the particulars of the ground that the making of the respondent's decision had been an improper exercise of power (ADJR Act para5(1)(e)).
   

(i) The respondent failed to attach any, or proper, weight to the fact that the breakdown of the purchase price referred to in para.9 of the Reasons gave approximate figures only;

(ii) the respondent failed to attach any, or proper, weight to the fact that the applicant was the innocent owner of the goods;

(iii) the respondent failed to give any, or proper, weight to the alleged admissions by Hastie referred to at para.10 of the Reasons;

(iv) the respondent failed to give any, or proper, weight to his finding at para.11 of the Reasons.

1. In support of the motion, counsel for the respondent argued that sub-s.5(2) of the ADJR Act specifies the bases upon which a decision can be reviewed as an improper exercise of power and that those bases do not include failure to give proper weight to particular considerations. Further, the respondent submitted that the grounds objected to could not be interpreted as referring to a failure to take relevant considerations into account as that basis of review was specified in other grounds of the application, namely sub-paras.3(a) and (c). The respondent's counsel cited Minister for Aboriginal Affairs v. Peko-Wallsend Ltd. (1986) 162 CLR 24 in support of his submissions.

2. In reply, the applicant put forward an argument with two limbs. In the first place, counsel argued that there was no power in the Court to strike out portions of an application for an order of review pursuant to the ADJR Act. It was said that an application for an order of review was not a "pleading" and hence the respondent's motion did not fall within O.11 r.16 of the Federal Court Rules. Counsel referred to the definition of "pleading" in O.1 r.4:
   

"Pleading includes a statement of claim and a cross-claim to which O.3 applies and subsequent pleadings but does not include an application, notice of motion or affidavit."

The applicant also submitted that the power referred to in O.11 r.16 is primarily designed to ensure compliance with the rules of pleading. In addition, reference was also made to sub-s.11(6) of the ADJR Act which states that:

"The applicant for an order of review is not limited to the grounds set out in the application but, if he wishes to rely on a ground not so set out, the Court may direct that the application be amended to specify that ground."

The applicant argued that this sub-section was incompatible with a pleadings approach to ADJR Act applications.

1. With regard to the power to stay or dismiss proceedings referred to in O.20 r.1, the applicant submitted that the striking out of the impugned sub-paragraphs would not result in the stay or dismissal of any "claim for relief" in the proceedings and that, therefore, the respondent's motion did not come within the scope of that rule.

2. In any event, the applicant's counsel stated, the sub-paragraphs which are objected to by the respondent are arguably within the ambit of paras.5(2)(g) and 5(2)(j) of the ADJR Act and that the failure to give proper weight to a relevant matter can be a ground for review on the basis of unreasonableness. Counsel for the applicant cited Minister for Aboriginal Affairs v. Peko-Wallsend Ltd. and Western Television v. Australian Broadcasting Tribunal (1986) 69 ALR 465 in support of this submission.

3. I will firstly address the applicant's argument that the Court has no power to strike out parts of an application for an order of review made under the ADJR Act.

4. Paragraph 11(1)(a) of the ADJR Act states that an application for an order of review "shall be made in such manner as is prescribed by Rules of Court" and O.54 of the Federal Court Rules is addressed to ADJR Act application. Order 54 r.1 states that, subject to O.54, the "Rules of Court prescribe the manner of making an application under the ADJR Act". Order 54 r.5 lists matters on which the Court may give directions and these powers are expressed to be "in addition to the powers of the Court under O.10". Order 54 r.6 states that:
   

"In applying O.20 r.2 to applications under the Administrative Decisions (Judicial Review) Act 1977 that rule shall be construed as if para.1(a) read 'no reasonable basis for the application is disclosed'."

Order 54 r.7 stipulates, inter alia, that an application pursuant to O.20 r.2 to have an application of review dismissed shall be made promptly. Order 10 r.1 states that, on a directions hearing, the Court shall give such directions with respect to the conduct of the proceedings as it thinks proper. Pursuant to O.10 r.1(2)(a), without prejudice to the generality of the sub-r.(1), the Court may make orders with respect to, inter alia, "the defining of the issues by pleadings or otherwise" (sub-para.(v)) and "amendments" (sub-para.1(x)). Further, sub-s.11(7) of the ADJR Act states that:

"The Court may, on such terms as it thinks fit, permit a document lodged with a Registry of the Court in connection with an application under this Act to be amended and may, if it thinks fit, direct such a document to be amended in a manner prescribed by the Court."

1. I am satisfied that the Court has the power to order that parts of an application pursuant to the ADJR Act for an order of review be struck out. In my view this is apparent from an examination of the abovementioned provisions of that Act and the Federal Court Rules.

2. In the first place, I am of the view that the definition of "pleadings" in O.1 r.4 does not have the effect of precluding the operation of O.11 r.16 in relation to ADJR Act applications. The definitions in O.1 r.4 are all prefaced by the phrase "unless the contrary intention appears". Order 54 r.1, in directing that the Rules should prescribe the manner of making an application under the ADJR Act, indicates an intention that such applications should conform to the standards established by the Rules for other Court documents. This intention is apparent from other rules in O.54. Rule 5, for example, refers to powers in the Court for giving directions and these powers are expressed to be "in addition to the powers of the Court under r.10". Order 54 r.6 refers to the application of O.20 r.2 to ADJR Act applications and r.7 to the dismissal of such applications pursuant to O.20 r.2. Where, as in O.11 r.16, there is an apparent disparity between the rules as they apply to other Court documents and as they might apply to ADJR Act applications, the rule should, if possible, be read as operating to regulate applications for orders of review. In this sense, O.54 r.1 indicates a "contrary intention" and the definition of "pleadings" in O.1 r.4 should be read as including an ADJR Act application.

3. Should the definition of "pleadings" in O.1 r.4 be read as not including ADJR Act applications within its ambit, however, the Court has the power to strike out portions of such applications quite apart from the power referred to in O.11 r.16.

4. Order 10 r.1(2)(a)(v) refers to a power to make orders with respect to "the defining of the issues by pleadings or otherwise", a description which clearly encompasses an order to strike out portions of an ADJR Act application which, on their face, do not disclose a basis for review.

5. The Court's power in this regard is further indicated by sub-s.11(7) of the ADJR Act. The power given in that sub-section to "direct a document lodged in connection with an ADJR Act application be amended" would, in itself, justify an order that certain paragraphs of an ADJR Act application be struck out.

6. Finally, should I be incorrect in holding out the abovementioned provisions of the ADJR Act and the Rules indicate that the Court has the power to strike out portions of an application pursuant to that Act, then that power would, in my view, be exercisable by this Court as part of the Court's inherent jurisdiction to control proceedings before it. (See Hughes Motor Services Pty. Ltd. v. Wang Computer Pty. Ltd. (1978) ATPR 40-098 per Bowen C.J. at p 17,964.) The Court is entitled to ensure that, prior to the hearing of an ADJR Act application, the issues have been defined with sufficient clarity to avoid needless expense by the parties and by the Court in dealing with allegations that disclose no basis for review. This kind of order is, in my view, of the kind envisaged by O.10 r.1(1).

7. Having determined that the Court has the power to grant the relief sought by the respondent in its notice of motion, I will now consider whether the sub-paragraphs of the application which are attacked should be struck out.

8. In Merman Pty. Ltd. v. Cockburn Cement Limited (1988) 54 ALR 521 at p 532 I indicated that, before the Court will strike out a pleading, it must be shown that "the applicant's case is so clearly untenable that it cannot possibly succeed: General Steel Industries Incorporated v. Commissioner for Railways (NSW) (1964) 112 CLR 125 per Barwick C.J. at p 130". The same principle is, in my view, applicable to the respondent's motion to strike out portions of an application pursuant to the ADJR Act for an order of review.

9. The only basis upon which the respondent contended that the impugned sub-paragraphs of the application should be struck out was that those sub-paragraphs disclosed no ground for review pursuant to the ADJR Act.

10. At first glance, the respondent's argument appears sound. There is no express provision in sub-s.5(1) of the ADJR Act for review on the ground of a failure to give proper weight to a consideration and sub-s.5(2) of that Act, in its explication of the scope of the "improper exercise of a power" ground does not mention the attribution of inadequate weight or undue weight.

11. The fact that improper attribution of weight is not expressed as a specific ground for review in the ADJR Act is not, however, determinative of the matters raised in the respondent's motion. Sub-section 5(2) of the ADJR Act is not expressed to be an exclusive list of the matters relevant to the "improper exercise of a power ground and, in any event, para.5(2)(j) refers to "any other exercise of a power in a way that constitutes abuse of the power" and it is conceivable that inadequate weight could be considered under this head.

12. The following comments of Mason J. (as he then was) in Minister for Aboriginal Affairs v. Peko-Wallsend Limited, made in relation to para.5(2)(b) of the ADJR Act, offer guidance as to the significance of the application of inadequate weight to relevant considerations to the judicial review of administrative decisions:
    

"The limited role of a Court reviewing the exercise of an administrative discretion must constantly be borne in mind. It is not the function of the court to substitute its own decision for that of the administrator by exercising a discretion which the legislature has vested in the administrator. Its role is to set limits on the exercise of that discretion, and a decision made within those boundaries cannot be impugned: Wednesbury Corporation.

It follows that, in the absence of any statutory indication of the weight to be given to various considerations, it is generally for the decision-maker and not the court to determine the appropriate weight to be given to the matters which are required to be taken into account in exercising the statutory power...I say "generally" because both the principle and authority indicate that in some circumstances a court may set aside an administrative decision which has failed to give adequate weight to a relevant factor of great importance, or has given excessive weight to a relevant fact of no great importance. The preferred ground on which this is done, however, is not the failure to take into account relevant considerations or the taking into account of irrelevant considerations, but that the decision is "manifestly unreasonable". This ground of review was considered by Lord Greene M.R. in Wednesbury Corporation, in which his Lordship said that it would only be made out if it were shown that the decision was so unreasonable that no reasonable person could have come to it. This ground is now expressed in ss.5(2)(g) and 6(2)(g) of the AD(JR) Act in these terms. The test has been embraced in both Australia and England...However, in its application, there has been considerable diversity in the readiness with which courts have found the test to be satisfied: cf., e.g., Wednesbury Corporation and Parramatta City Council, with the conclusions reached in South Oxfordshire District Council v. Secretary of State for the Environment; Shoreham-By-Sea Urban District Council; and Minister of Housing and Local Government v. Hartnell. But guidance may be found in the close analogy between judicial review of administrative action and appellate review of a judicial discretion. In the context of the latter, it has been held that an appellate court may review a discretionary judgment that has failed to give proper weight to a particular matter, but it will be slow to do so because a mere preference for a different result will not suffice: Lovell v. Lovell; Gronow v. Gronow; Mallet v. Mallet. So too in the context of administrative law, the court should proceed with caution when reviewing an administrative decision on the ground that it does not give proper weight to relevant factors, lest it exceed its supervisory role by reviewing the decision on its merits."

1. It is apparent from his Honour's comments that he regarded the occasions upon which the inappropriate attribution of weight would be a basis for an order of review would be rare. Further, his Honour indicated that such a ground may be subsumed under the ground of "unreasonableness". Such a ground is expressly included in para.5(2)(g) of the ADJR Act as a particular of the general ground of improper exercise of power. His Honour does not state that inappropriate weight cannot establish a ground for review of a decision pursuant to the ADJR Act.

2. I note that diverging views have been expressed regarding the question of whether undue or inadequate weight can, in itself, be a ground for review under the ADJR Act. In Sean Investments Pty. Ltd. v. MacKellar (1982) 42 ALR 676 at p 684, Franki J. stated that:
   

"I do not think that s.5 of the (ADJR) Act extends to a case where the only basis for attacking the decision under review is that undue weight was given to a consideration to which it was permissible to give some consideration."

1. The conclusion of Woodward J. in Sordini v. Wilcox (1983) 70 FLR 326 at p 343 would appear to point in the opposite direction:
   

"It is clear that the taking into account by an administrative tribunal of irrelevant factors, or the failure to give any, or any sufficient weight to significant factors in the exercise of a discretion, will open the door to a judicial review of that discretion. This is the third circumstance in which an appellate court may interfere. See, for example, Edmund Davies L.J. in Instrumatic Ltd v. Supabrase Ltd (1969) 1 WLR 519."

I note that Blackburn J. appears to agree with Woodward J. on this point (see p 331).

1. In Western Television v. Australian Broadcasting Tribunal, Pincus J., after considering the cases referred to above and others, concluded that:
   

"Although I have doubt whether improper weighting of considerations was ever, in itself, a ground for the issue of prerogative writ, it seems clear enough that the proper course is to follow the views expressed in these decisions of the High Court and of the Full Court. In doing so, however, I should act on the basis that wrong weighting does not vitiate a decision unless it 'really amounts to a failure to exercise the discretion...' per Latham CJ in Lovell v. Lovell

(1950) 81 CLR 513 at p 519; see also per Gibbs CJ In the Marriage of Mallet (1984) 52 ALR 193 at p 200."

1. In Tabag v. Minister for Immigration and Ethnic Affairs (1982) 45 ALR 705 the Full Court considered whether the giving of inadequate weight to a relevant consideration could amount to an error of law for the purposes of s.44 of the Administrative Appeals Tribunal Act 1975. That question is not the point of issue in this matter which involves the review of an administrative discretion and not the exercise of appellate jurisdiction. Nothing that is said in those judgments would deny the possibility of improper attribution of weight being sufficient to establish that an administrative decision has been an improper exercise of a discretionary power within the meaning of para.5(1)(e) of the ADJR Act.

1. Paragraphs 5(2)(a) and 5(2)(b) of the ADJR Act state that taking into account irrelevant considerations and failing to take into account relevant considerations are elements of the ground of improper exercise of a power. In some cases improper attribution of weight may be covered by either of those specified elements, but there will be other occasions when it is not. Similarly, although as stated earlier the application of weight may be expected to be subsumed under the "unreasonableness" ground (para.5(2)(g)), there may be cases where such circumstances will stand on their own to show that a power has been improperly exercised.

2. It appears that the weight of authority inclines towards a finding that improper weight can, of itself, in certain exceptional circumstances, establish that a discretion has been improperly exercised, a ground for an order to review pursuant to the ADJR Act. Without expressing a concluded view on the point, I am of the view that the respondent has not established that the impugned paragraphs of the application in this case are so clearly untenable that they cannot possibly succeed in establishing a basis for review of the respondent's decision. In reaching this conclusion I do not, of course, express any view as to the strength of the applicant's case with regard to the claims that inadequate weight was given to certain considerations.

3. I will, therefore, make an order that the respondent's motion be dismissed and that the respondent pay the applicant's costs of the motion.