World Best Holdings Limited v Abul Sarker

[2004] NSWSC 1164

CITATION:	World Best Holdings Limited v Abul Sarker [2004] NSWSC 1164 revised - 15/12/2004
HEARING DATE(S):	24/11/04 25/11/04 26/11/04
JUDGMENT DATE:	3 December 2004
JUDGMENT OF:	Acting Justice Patten
DECISION:	1. Order that the decision of the Tribunal published on 25 June 2004 be set aside.; 2. Order that the case be remitted to the Tribunal to be heard and decided again by a Tribunal constituted according to law in accordance with these reasons. ; 3. Order that the First Defendant, Mr Abdul Sarker, pay the Plaintiff's costs.; 4. Order that there be granted to Mr Sarker an indemnity certificate, pursuant to section 6 of the Suitors Fund Act.; 5. Make no order in respect of the costs of the Second and Third Defendants.; 6. Order that the costs of the first hearing before the Tribunal be at the discretion of the member constituting the Tribunal at the second hearing.; 7. Liberty to all parties to apply on 7 days notice.
LEGISLATION CITED:	Retail Leases Act 1994 (NSW) Administrative Decisions Tribunal Act 1997 (NSW) Interpretation Act 1987 (NSW) Suitors Fund Act 1951 Supreme Court Act 1970
CASES CITED:	Tax Agent's Board of Queensland v Seymour 94 ALR 635 R v Munroe (2003) 56 NSWLR 652 at 656 - 658 Meagher v Stephenson (1993) 30 NSWLR 736 Drake v The Minister for Immigration and Ethnic Affairs (1979) 46 FLR 409 G J Coles & Co Limited v Retail Trade Industrial Tribunal (1986) 7 NSWLR 503) Attorney General (Vic) v Warehouse Group (Aust) Pty Ltd (2002) VSCA 76
PARTIES :	World Best Holding Limited - Plaintiff Abul Sarker - First Defendant Administrative Decisions Tribunal - Second Defendant Attorney General (NSW) - Third Defendant
FILE NUMBER(S):	SC 030052/04
COUNSEL:	R. J. Ellicott QC/M. Ellicott - Plaintiff M. Ashhurst/S. Docker - First Defendant M. Allars - Third Defendant
SOLICITORS:	Philip A Biber - Plaintiff Kemp Strang - First Defendant I V Knight - Second and Third Defendats

LOWER COURTJURISDICTION:	Administrative Decisions Tribunal
LOWER COURT FILE NUMBER(S):	35087; 35100
LOWER COURT JUDICIAL OFFICER :	Mr B G Donald

25

- -

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION
ADMINISTRATIVE LAW LIST

PATTEN AJ

3 DECEMBER 2004

030052/04


WORLD BEST HOLDINGS LIMITED

v

ABUL SARKER & ORS
JUDGMENT

1 HIS HONOUR: The proceedings before me were instituted by the Plaintiff (World Best) as an appeal as of right on a question of law against a decision of the Administrative Decisions Tribunal of NSW (The Tribunal) given on 25 June 2004. The right of appeal is conferred by s 77(2) of the Retail Leases Act 1994 (NSW) (the RL Act). An application by World Best for leave to appeal for a review of the merits of the Tribunal’s decision, pursuant to sec 77 (4) of the R L Act was dismissed by Sully J on 12 October 2004.

2 The decision of the Tribunal was upon claims by the First Defendant (Mr Sarker) which constituted a retail tenancy claim under sec 71 and also an unconscionable conduct claim under sec 71A of the R L Act. The claims arose out of the previous relationship between World Best and Mr Sarker as lessor and lessee of a retail shop. The two claims were heard together and, in the result, the Tribunal declared that the lease between World Best and Mr Sarker had been duly terminated by Mr Sarker, ordered that World Best pay Mr Sarker “as compensation for unconscionable conduct and for repudiation of the lease, $80,637.77”, and ordered that World Best pay Mr Sarker certain costs.

3 World Best’s appeal joined as Defendants, both Mr Sarker and the Tribunal. The latter filed a submitting appearance. At the hearing, however, I gave leave to the Attorney General to be joined as a Defendant and he was represented by Ms M Allars of counsel.

RELEVANT STATUTORY PROVISIONS:

4 Two statutes have particular relevance to this case, namely the RL Act and the Administrative Decisions Tribunal Act 1997 (the ADT Act). The full title of the R L Act is “an act to make provision with respect to the leasing of certain retail shops and the rights and obligations of lessors and lessees of those shops and for other purposes”. The act seeks to achieve its objectives with a number of very detailed provisions. Part 7A deals with the subject of unconscionable conduct, ss (1) and (2) of s 62 B providing:

“(1) A lessor must not, in connection with a retail shop lease, engage in conduct that is, in all the circumstances, unconscionable.

(2) A lessee must not, in connection with a retail shop lease, engage in conduct that is, in all the circumstances, unconscionable.”

5 Subsections (3) to (7) specify at considerable length, the matters to which the Tribunal may, or must, have regard in considering whether or not there has been unconscionable conduct in relation to a retail shop lease. Subsections (8) and (9) provide:

“(8) A lessor or lessee, or former lessor or lessee, who suffers loss or damage by reason of unconscionable conduct of another person that is in contravention of this section may recover the amount of the loss or damage by lodging a claim against the other person under section 71A.

(9) If the matter of such loss or damage arises in connection with a matter the subject of proceedings in the Tribunal, the Tribunal may proceed to decide it, and in so doing may award such sum as it thinks fit.”

6 Section 70 of the R L Act deals with what are called “retail tenancy claims”. That expression includes, for instance, a claim “for the payment of a specified sum of money” and “a claim for a declaration of the rights, obligations and liabilities of the parties under a lease”. Section 71 enables a party or former party to a retail shop lease to lodge a retail tenancy claim with the Tribunal for determination. Under s 72, the Tribunal, upon such a claim, is empowered to make a wide range of orders, including an order that a party to the proceedings pay damages.

7 Section 72 AA deals with the powers of the Tribunal in respect of unconscionable conduct claims. Included is the power to make an order for the payment of money by way of debt, damages or restitution. A monetary limitation of $300,000 (or such other amount as may be prescribed by the regulations) is imposed by s 73.

8 Provisions of s 75 and s 76A illustrate the different approach adopted by Parliament for the determination by the Tribunal of, on the one hand, retail tenancy claims and, on the other hand, claims in respect of unconscionable conduct. Section 75, relevantly for this purpose, provides:

“(1) If civil proceedings pending in a court involve a retail tenancy dispute, the court must on the application of any party to the proceedings transfer the proceedings (or so much of the proceedings as involve such a dispute) to the Tribunal to be dealt with as a claim under this Division, but only if the court is satisfied that:

(a) the dispute is such as may effectively be dealt with as a claim under this Division and that it is appropriate that the dispute be dealt with by the Tribunal, and

(b) the interests of justice do not require that the matter be dealt with by the court.

(2) In determining whether or not it is appropriate that a matter be dealt with by the Tribunal, a court is to have regard to the general principle that retail tenancy disputes should be dealt with by the Tribunal rather than by a court.

(3) Proceedings are taken to involve a retail tenancy dispute if any issue in dispute in the proceedings involves a liability or obligation with which a retail tenancy dispute is concerned.

(4) ………………………………………

(5) ………………………………………

(6)………………………………………”

9 On the other hand, sec 76 A provides:

(1) A party to proceedings before the Tribunal for an unconscionable conduct claim may apply to the Tribunal to have the proceedings transferred to the Supreme Court.

(2) The Tribunal must transfer the proceedings if the Tribunal is satisfied that:

(a ) the nature of the claim is such that it may be more effectively and appropriately dealt with by the Supreme Court, and
(b) the interests of justice do not require the matter to be continued to be dealt with by the Tribunal.

(3) The Supreme Court has jurisdiction to hear and determine proceedings for an unconscionable conduct claim transferred to it under this section and may make any orders and do anything that the Tribunal may do in determining an unconscionable conduct claim.

(4) The Supreme Court may exercise all the functions that are conferred or imposed by or under this or any other Act on the Tribunal to determine the unconscionable conduct claim.”

10 The legislative policy is further, in my opinion, illustrated by the appeal provisions of s 77, the relevant provisions of which are:

“77 - Appeals

(1) A party to any proceedings (other than a party to proceedings for an unconscionable conduct claim) in which the Tribunal makes an order or other decision under this Act may appeal to an Appeal Panel of the Tribunal under Part 1 of Chapter 7 to the Administrative Decisions Tribunal Act 1997.

(2) A party to any proceedings for an unconscionable conduct claim may appeal to the Supreme Court, on a question of law, against any decision of the Tribunal in those proceedings.

(3) Sections 120 and 121 of the Administrative Decisions Tribunal Act 1997 apply to an appeal to the Supreme Court under subsection (2) in the same way as they apply to an appeal to the Supreme Court on a question of law, against a decision of the Appeal Panel.

(4) A party to any proceedings for an unconscionable conduct claim may appeal to the Supreme Court, with the leave of the Supreme Court, for a review of the merits of a decision by the Tribunal in those proceedings.

(5) Sections 115 and 116 of the Administrative Decisions Tribunal Act 1997 apply to an appeal to the Supreme Court under subsection (4) in the same way as they apply to appeals to the Appeal Panel under Part 1 of chapter 7 of the Administrative Decisions Tribunal Act 1997 that extend to a review of the merits of an appealable decision.

(6) If proceedings relate partly to a retail tenancy claim and partly to an unconscionable conduct claim, subsection (2) – (5) apply to those proceedings.

(7) ……………………………………………..”

11 Under the ADT Act, membership of the Tribunal is comprised of a President, who must be a judge of the District Court, Deputy Presidents and non-presidential judicial members who are eligible for appointment if they hold, or have held, judicial office in NSW or the Commonwealth, or another state or territory, or are legal practitioners of at least 7 years standing, and non-judicial members being persons who have, in the opinion of the Minister, special knowledge or skill in relation to any class of matters in respect of which the Tribunal has jurisdiction.

12 By s19 of the ADT Act, the Tribunal is to exercise its functions in Divisions. By s 21, the President is assigned to each Division, a Divisional Head is assigned to the Division in respect of which he, or she, is appointed as the Divisional Head. The President is to assign each member, other than the President, or a Divisional Head, to one or more Divisions and may assign a member who is a Divisional Head to one or more Divisions, in respect of which the member is not the Divisional Head. The President may vary any such assignment at any time.

13 Section 21(4) reads:

“An assignment of a member to a Division:
(a) is to be made in accordance with any applicable provisions of Schedule 2 or of this or any other Act, and
(b) is subject to any limitations specified in the member’s instrument of appointment.”

14 Relevantly, s 22 provides that the Tribunal for the exercise of its functions (other than the functions of an Appeal Panel) is to be constituted by one or more members of the relevant Division. The President, or relevant Divisional Head, may give directions as to the members who are to constitute the Tribunal for any particular proceedings and, in giving such directions, is required to have regard to a number of matters, including the degree of public importance or complexity of the subject matter of the proceedings.

15 Section 73 entitles the Tribunal, subject to the Act and the rules to determine its own procedure; establishes that the Tribunal is not bound by the rules of evidence and directs that the Tribunal is to act with as little formality as the circumstances of the case permit. Section 77 contemplates that the Tribunal may be constituted by one member alone, by providing that where the Tribunal is constituted by more than one member, the most senior member is to preside.

16 Section 136, which may have some relevance to the matters debated before me, provides:

“136 Proof of certain matters not required:

In any legal proceedings, no proof is required (unless evidence to the contrary is given) of:

(a) the constitution of the Tribunal or

(b) any decision of the Tribunal , or

(c) the appointment, or the holding of office by, a member of the Tribunal or an assessor, mediator or neutral evaluator.”

17 Schedule 1 to the ADT Act lists the six Divisions of the Tribunal, including a Retail Leases Division and Schedule 2 specifies the “Composition and functions of Divisions”. Pt 3 B deals with the Retail Leases Division. It is necessary for an understanding of the matters argued in this case, that I set out the part in full, as follows:-

“Part 3B Retail Leases Division

Division 1 Composition of Division

1 Division members

(1) The Retail Leases Division is to be composed of the following members:

(a) a Divisional Head appointed in accordance with subclause (2),

(b) such other members as may be assigned to the Division in accordance with subclause (3) or otherwise by or under this Act.


(2) A Deputy President is to be appointed as the Divisional Head by the Governor.

(3) The following members are to be assigned to the Retail Leases Division of the Tribunal in their instruments of appointment or by subsequent instrument of the Minister:


(a) at least 1 member who is a retired judge of the Supreme Court or the Federal Court or who has equivalent experience or qualifications,

(b) at least 1 member who has experience as a lessor, or working on behalf of lessors, under retail shop leases,

(c) at least 1 member who has experience as a lessee, or working on behalf of lessees, under retail shop leases.

Functions of Division

2 Functions allocated to Division

The functions of the Tribunal in relation to the following enactments are allocated to the Retail Leases Division of the Tribunal:

Retail Leases Act 1994

Division 3 Special requirements for constitution of Tribunal for certain allocated functions

3 Retail Leases Act 1994 (retail tenancy claims)

(1) For the purposes of exercising its functions under the Retail Leases Act 1994 in relation to retail tenancy claims the Tribunal is to be constituted by:

(a) the Divisional Head, or, if the Divisional Head is not available, a judicial member, and

(b) if requested by a party to the proceedings, 2 other members, consisting of a member of a kind referred to in clause 1 (3) (b) and a member of a kind referred to in clause 1 (3) (c).


(2) If proceedings relate partly to an unconscionable conduct claim and partly to a retail tenancy claim, for the purposes of hearing and determining those claims the Tribunal is to be constituted in accordance with clause 4.

Retail Leases Act 1994 (unconscionable conduct)

(1) For the purposes of exercising its functions under the Retail Leases Act 1994 in relation to unconscionable conduct claims the Tribunal is to be constituted by a Division member referred to in clause 1 (3) (a).

(2) The Tribunal is to be assisted by 2 other members, in an advisory capacity only, consisting of a member of a kind referred to in clause 1 (3) (b) and a member of a kind referred to in clause 1 (3) (c).

(3) A member assisting the Tribunal under this clause is not to adjudicate on any matter before the Tribunal.

(4) The Tribunal may commence or continue to determine the proceedings or any part of the proceedings:


(a) without the assistance of a member who is not available or has ceased to be available to assist in the proceedings, and

(b) without the assistance of the members generally if, in the opinion of the Tribunal, the proceedings or part of the proceedings concern or concerns a question of law only.”

Hereafter, my references to clauses are to be taken as references to clauses within Part 3B of Schedule 2 to the ADT Act.

18 As a matter of convenience to other counsel, Mr R Ellicott QC, who appeared with Mr M Ellicott, for the Plaintiff, confined his submissions in the first instance to two questions, namely, whether the Tribunal, in this case, was constituted as required by clause 4(1) and whether the adjudication of the Tribunal offended clause 4(3). After hearing Mr Ellicott and Mr Ashhurst, who appeared with Mr Docker for the First Defendant, and Ms Allars, I indicated that I had formed the firm conclusion that the determination of the Tribunal could not stand, at least because it was to be inferred that the members assisting the Tribunal had, contrary to clause 4(3), adjudicated on the matter. Mr Ellicott thereupon accepted that there was no need for him to make submissions in support of other matters raised in the appeal. The matter was adjourned to today in order that I might give reasons and make formal orders.

MAY THE CONSTITUTION OF THE TRIBUNAL BE ATTACKED IN THESE PROCEEDINGS?

19 The Plaintiff’s contention that the Tribunal was not properly constituted was based on the proposition that Mr B G Donald, who comprised the Tribunal was not a person qualified under clause 1(3)(c).

20 It was argued on behalf of the Defendants that the qualifications of by Mr Donald could not be challenged in this appeal and that the Plaintiff should have sought relief under s 69 of the Supreme Court Act, being then put to his election. Reference was made to Meagher v Stephenson (1993) 30 NSWLR 736. In that case there was an appeal pursuant to sec 146 of the Liquor Act against the decision of the Full Bench of the Licensing Court. The appellant also applied for orders in the nature of certiorari and mandamus directed to the Full Bench.

21 The appeal failed at first instance, Campbell J holding that no error of law was demonstrated. The Court of Appeal (Priestley JA, Handley JA and Cripps JA) in its judgment said at 738 - 739:

“In the present case relief in the nature of certiorari was sought for non-jurisdictional error on the face of the record. Given the comprehensive nature of the record that has been recognised for this purpose by this Court (see Commissioner for Motor Transport v Kirkpatrick (1988) 13 NSWLR 368) certiorari on that ground is akin to an appeal on a question of law. Where, as in this case, the same court has both appellate and supervisory jurisdiction, the claim for certiorari for non-jurisdictional error on the face of the record cannot provide any relief which is not also available in the appeal.”

22 On the other hand in Drake v the Minister for Immigration and Ethnic Affairs (1979) 46 FLR 409; 24 ALR 577; the Full Court of the Federal Court (Bowen CJ, Smithers and Deane JJ) upon an appeal on a question of law from the Commonwealth Administrative Appeals Tribunal, considered and dealt with the question whether Davies J was competent, as a judge of the Federal Court to constitute the Appeals Tribunal. It was argued that it was not permissible under the Constitution for a judge of a court created by the Commonwealth Parliament, to be appointed to an office such as Deputy Chairman of the Administrative Appeals Tribunal, involving the exercise of administrative functions, quasi judicial in character.

23 Although the judgment does not expressly deal with the appropriateness of deciding on an appeal the question of the constitution of the Appeals Tribunal by Davies J, the Court seems to have assumed that it was a question of law to be dealt with in conjunction with the other grounds of appeal.

24 A not dissimilar issue to the one now under consideration arose in Attorney General (Vic) v Warehouse Group (Aust) Pty Ltd (2002) VSCA 76. The proceedings in the Victorian Court of Appeal were an appeal from a single judge hearing an appeal from a determination of the Victorian Civil and Administrative Tribunal.

25 One of the grounds of appeal, ground 16, concerned the constitution of the Administrative Tribunal, it being alleged “The Tribunal had no power to hear and determine the proceedings as it was not constituted by a member who has sound knowledge of and experience in, planning or environmental practice in Victoria”. The Court of Appeal rejected the challenge to the constitution of the Administrative Tribunal, but, in the course of doing so, said (citations omitted):

“It was argued below that the Trial Division had no jurisdiction to entertain this appeal for a number of reasons. First, it was said, that the “decision” under appeal was not so that of Mrs Komesaroff, constituting the Tribunal, but that of the President in assigning her to the planning list. Secondly, it was said that whether Mrs Komesaroff answered the description in c152 was a question of fact, not a question of law. Thirdly, it was said that the objection to her qualifications, if a question of law, should have been raised before the Tribunal and not on appeal for the first time. Fourthly, it was said that the Tribunal should have been joined as a party. All of these submissions were rejected by the trial judge and, with respect, rightly so. If there was an appeal on foot, it was not against the decision of the President who assigned Mrs Komesaroff to the planning list; it was from the determination of the Tribunal. Again, if there was an appeal on foot, it was over the interpretation of cl52, and not the fact of Mrs Komesaroff’s qualifications, which were as described in Exhibit B and were not challenged. Thirdly, although an objection may have been taken below to the constitution of the Tribunal before the application was heard and determined, it was not fatal that the point was raised only afterwards. And finally, joinder of the Tribunal was not a step required on an appeal under s148 of the Tribunal Act. But having said that, there is yet a fundamental objection to the exercise of jurisdiction by the Trial Division in relation to ground 16 in the notice of appeal, which stems from the commencement of an appeal under s148. In ground 16 Warehouse was challenging the very constitution of the Tribunal which made the orders from which it was otherwise wishing to appeal. Such a challenge is to jurisdiction, as indeed the Trial Judge, in upholding the challenge, recognised in the penultimate paragraph of the reasons for judgment, that is para 41. such a challenge should have been mounted by way of judicial review and not appeal: See, for example, G J Coles & Co v Retail Trade Industrial Tribunal in which a tribunal was wrongly constituted and prerogative relief was sought and granted. Nor, in our view, was anything to the contrary said in Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue (Vic) to which Mr Morris referred. Our dealing with the question of the constitution of the Tribunal should therefore not be taken as any endorsement of the procedure adopted by Warehouse on this occasion.
In another case, the conclusion that a proceeding by way of judicial review was appropriate but not an appeal might mean that leave to appeal should never have been granted in the first place and that once granted, the appeal should have been dismissed as incompetent. In this instance, however, there were many other grounds of appeal: only ground 16 was affected by the considerations of procedure to which we have referred, and ground 16 was determined as a preliminary question. Given the way in which the matter was heard and determined below, it is appropriate, we think, for this Court to allow the appeal, to set aside the order made below and upon the understanding that argument has been addressed upon the remaining ground to remit the matter back to the Trial Division for hearing and determination according to law in the light of our reasons for judgment.”

26 Although this is not a case where non-jurisdictional error on the face of the record is claimed, in my opinion, no authority, to which I have been referred, prevents me dealing with the constitution of the Tribunal by Mr Donald as a question of law on appeal. Following what was done in Attorney General v Warehouse Group, it seems to me to be convenient to deal with the question, which was argued as a discrete matter as if it were a matter of law, even if technically the proceedings should have been brought by way of judicial review. In any event, I am far from persuaded that as a matter of interpretation the question concerning the appointment of Mr Donald does not constitute a question of law within the ambit of s 77(2) of the RL Act.

WAS THE TRIBUNAL DULY CONSTITUTED?

27 In this case, the Tribunal was exercising functions under the R L Act in relation to a retail tenancy claim and in relation to an unconscionable conduct claim. Clause 3(2) applied and, in my opinion, clause 4(1) mandated that the Tribunal be constituted solely by a Division member of the class referred to in clause 1(3)(a). This is in contra distinction to what is prescribed for the constitution of the Tribunal when exercising its functions in relation to a retail tenancy claim alone. Then it is to be constituted by the Divisional Head or other judicial member and, if requested by a party, two other members of the kind referred to in clause 1 (3)(b) and (c).

28 As I have said the Tribunal was constituted by Mr Donald. As appears from the affidavit of Ms Catherine Szczygielski, Registrar of the Tribunal, he was appointed as a part-time, non-presidential, judicial member of the Tribunal by the Attorney General on 23 February 1999, for a term of 3 years from that date. He was assigned by the President on 29 March 1999 to the General Division and, subsequently, on 6 July 1999 to the Retail Leases Division. He was re-appointed as a part-time, non-presidential, judicial member by the Attorney General on 1 March 2002 for a period of 3 years, commencing that date and on the same date was assigned by the President to the Retail Leases Division.

29 On 17 September 2003, in purported exercise of the power conferred by clause 1(3)(a), the Attorney General assigned Mr Donald as a member of the Retail Leases Division, “for the purposes of exercising the Tribunal’s functions under the Retail Leases Act 1994 in relation to unconscionable conduct claims.

30 Mr Ellicott, whilst accepting that Mr Donald was, and is, a duly appointed part-time, judicial member of the Tribunal assigned to the Retail Leases Division, submitted that he was not qualified for appointment pursuant to clause 1(3)(a) and was not therefore qualified to constitute the Tribunal, under clause 4(1).

31 According to the records of the Tribunal, it was formally conceded that Mr Donald has not been a judge of the Supreme Court or of the Federal Court. His curriculum vitae, annexed to the affidavit of Ms Szczygielski, indicates that he was admitted as a solicitor in NSW in 1969 and since then has had experience in a wide range of areas within the law. Since January 1996, he has been in sole practice in Sydney in the fields of technology, media, communications, financial regulation, public interest law, defamation litigation, environmental and public law litigation. It is plain that he was highly qualified for appointment as a Judicial Member of the Tribunal.

32 However, clause 1(3)(a) is very specific. In Mr Ellicott’s submission it requires the appointment of a person who holds or has held high judicial office. As to the meaning of the somewhat obscure phrase, “or who has equivalent experience or qualifications”, Mr Ellicott submitted that I should have regard in accordance with s 34 of the Interpretation Act, to the Second Reading speech of the Hon R D Dyer, in the Legislative Council, on 1 December 1998, in the course of which he said:

“The Tribunal will continue to provide a forum for dealing with retail tenancy claims and will also ensure that matters of commercial contract law dealt with under the unconscionable conduct provisions are heard in a jurisdiction with the appropriate degree of legal expertise. To this end, these amendments provide for unconscionable conduct matters to be heard in the retail leases division by a retired judge of the Supreme Court or the Federal Court, or a lawyer of equivalent experience and qualifications, who will be appointed by the Government after appropriate consultation with the retail and retail property industries. This judicial member will determine whether unconscionable conduct has been proven and will be assisted, in an advisory capacity only, by two other members of the division who will be appointed by the Government, after due consultation with industry, on the basis of their experience working for lessor and lessees respectively.

The amendments also provide for reference of unconscionable conduct matters to the Supreme Court. This can be done in the first instance on the application of a party to the proceedings to have the proceedings transferred to the Supreme Court. The Administrative Decisions Tribunal must transfer proceedings to the Supreme Court if it is satisfied that the claim can be more effectively and appropriately dealt with by the Supreme Court and the interest of justice do not require the matter to continue to be dealt with by the tribunal. In second instance, there is a right of appeal against decisions of the tribunal. On matter dealing with unconscionable conduct, there will be an unfettered right of appeal to the Supreme Court on questions of law. There is also a right of appeal to the Supreme Court, by leave of the Court, for a review of the merits of a decision by the tribunal.

The appointment of a judicial member with Supreme Court or equivalent experience to determine unconscionable conduct matters combined with the right to have unconscionable conduct matters removed to the Supreme court, either by reference or by appeal, will ensure that the important issues of legal judgment that are inherent in the concept of unconscionable conduct will be dealt with at an appropriate judicial level with proper regard for the rights of the parties to the case. It is recognised that as the unconscionable conduct provisions established through this bill are based on the Trade Practices Act their application is, to a certain extent, dependent on issues in relation to coverage within the ambit of the Commonwealth. On a further matter, the Retail Leases Act was scheduled for review during 1997-98 under the National Competition Policy [NCP] Agreement.”

33 In my opinion, it is appropriate in this case, having regard to the matters set forth in sec 34(3) of the Interpretation Act to take account of the Ministers speech in ascertaining the meaning of the phrase “equivalent experience or qualifications”. In a somewhat different context, Pincus J considered the meaning of the word “equivalent”, in Tax Agent’s Board of Queensland v Seymour 94 ALR 635. The relevant sections of the Income Tax Assessment Act required applicants for registration as tax agents to hold prescribed qualifications. Regulation 58 C A of the Income Tax Regulations prescribed certain qualifications, including that an applicant shall have:

“(a) engaged in relevant employment on a full time basis for not less than a total of 12 months in the preceding 5 years,
(b) otherwise been engaged in relevant employment to an extent that the Board regards as equivalent to that referred to in sub-paragraph (a), or
(c) been engaged in such other employment and for such time as the Board regards as equivalent to being engaged in relevant employment as referred to in sub-paragraph (a).”

Pincus J concluded his judgment with these observations at 640:-

“The conclusion which I have come to, namely that the tribunal was wrong in deciding that the respondent was in “employment” within the meaning of the relevant provisions, makes it unnecessary to consider the other points raised by Miss Wilson. Since I have a view about one of them however, I have decided to express it. It is my opinion that the word “equivalent” in para C read in context, does not connote precise equivalence to the qualification in para a. The question is what the Board regards as equivalent, and it may properly treat as equivalent to the work specified in sub-reg (2), work which is of a different description, as long as the applicant has done the work while in “employment” in the sense I have explained.

In summary, it is my view that the word “employment” in reg 58 CA is used in a sense which excludes those simply working alone in their own business – the so-called self-employed”. It follows that the respondent was not qualified under that regulation. The decision of the tribunal must be set aside.”

34 As a matter of interpretation, I am of the view that the phrase, “equivalent experience or qualifications” should be regarded as a single expression and should not be given dispersive effect. In other words, the word “or” should be construed as “and”. Such an interpretation, in my opinion, gives effect to the legislative intention (See for instance what was said in R v Monroe (2003) 56 NSWLR 652 and the authorities there quoted, where O’Keefe J interpreted the word ”and” as meaning “or”).

35 Although the concluding phrase in clause 1(3)(a) does not, in my view, following what was said by Pincus J, require precise equivalence, it does, in my opinion, require considerably more than mere qualification for appointment as a judge of the Supreme Court or of the Federal Court. Other references in the ADT Act to judicial officers indicate, I think, that if this were the case, Parliament would have said so.

36 Counsel for the Defendants did not accept that clause 1(3)(a) only contemplates a person who holds or who has held high judicial office. It was submitted that on any basis, Mr Donald’s qualifications and experience fall within the clause and that, in effect, the Plaintiff has a high onus in attempting to show that the Attorney General’s appointment was invalid.

37 I accept that the Plaintiff has the onus of establishing that Mr Donald was not qualified under clause 1(3)(a) and that, in the circumstances, such onus needs to be satisfied to, at least, the degree of comfortable satisfaction.

38 However, I cannot escape the conclusion that Parliament intended, by the clause, that the man or woman hearing unconscionable conduct claims would have judicial experience of a high order. No other person, in my view, could be said to have the experience and qualifications of a judge of the Supreme Court or the Federal Court. The expression “equivalent experience or qualifications” would encompass many other classes of former judicial officers, including, for example, retired justices of the High Court and retired judges of other Australian superior courts.

39 In my opinion, notwithstanding his learning and considerable legal experience, it manifestly appears, on the evidence before me, that Mr Donald was not qualified for appointment under clause 1(3)(a). It follows that the parties were deprived of the right conferred by the legislation to have their dispute resolved in the manner intended by Parliament.

THE DE FACTO OFFICERS DOCTRINE

40 It was submitted on behalf of the Defendants that, in the event of a finding that Mr Donald was not qualified for appointment under clause 1(3) (a), the doctrine of de facto officers would apply to validate his acts. I was referred to a number of cases, to the paper published by Sir Owen Dixon in 1938 De Facto Officers, reprinted in Jesting Pilate, S. Woinarski (ed) The Law Book Company Ltd 1965, page 229 and the paper by Professor Enid Campbell, De Facto Officers, Australian Journal of Administrative Law, Volume 2, page 5.

41 Professor Campbell referred to the doctrine as “a long established doctrine of common law, generally known as the de facto officers doctrine, which operates to validate certain acts by persons purporting to exercise powers reposed in occupants of a certain public office, notwithstanding that the person in question is not entitled to occupy that office”. She identified these essential conditions for the operation of the doctrine:

· The office occupied and exercised must be an office de jure.

· The acts of a de facto officer must have been within the scope of the authority of an office de jure.

· The person claiming to be a de facto officer must have the reputation of being an officer de jure or the defect in his or her title must be unknown to members of the public.

42 All those conditions are applicable in this case. However, as pointed out by Professor Campbell cases upon the doctrine establish limitations, one of which is where its application would defeat a clear statutory policy.

43 The cases referred to, included the relatively recent decision of the Court of Appeal in G J Coles & Co Limited v Retail Trade Industrial Tribunal (1987) 7 NSWLR 503. It concerned the making of an industrial award by the Retail Trade Industrial Tribunal. That Tribunal was a tripartite body, established under the Industrial Arbitration Act consisting of a judge of the Industrial Court as chairman and two assessors. The assessors, under the statute, were to assist and advise the chairman but not to adjudicate on any matter before the Tribunal. There was a failure to convene a meeting of the Tribunal in accordance with the procedures laid down in the Act and Regulations, with the consequence that the assessors did not attend or participate in the sitting of the Tribunal and an award was made by the chairman, alone. The Court of Appeal held that the award was invalid.

44 In the course of their joint judgment, Kirby P and Hope JA discussed the doctrine of de facto officers in these terms at 519 - 520:

“Secondly, we are in any case by no means convinced that the “doctrine” of de facto officers applies to these proceedings. The award here is a creature of statute. The ultimate obligation of the Court is to determine the meaning of legislation and to ensure that the legislative purpose is fulfilled. No common law doctrine can avail the parties if it flies in the face of the particular legislation under review. That is the case here. The legislature made it abundantly plain that assessors should participate in meetings of the Tribunal. Their participation was intended to affect the decisions of the Tribunal and awards made by it. The “doctrine” of de facto officers cannot operate to protect an award, made otherwise than in accordance with the legislation, if, in doing so, it negatives clear legislative provisions.

What was involved here was not merely a suggested irregularity in the appointment of particular members of a Tribunal as in Ellis v Bourke (1889) 15 VLR 163. Nor is it a case such as Margate Pier Co v Hannam (1819) 3 B & Ald 266; 106 ER 661, where a provision of a statute requiring a duly appointed justice of the peace to take an oath before acting was held to be binding only on the justice personally and making him liable to a penalty at common law, but not to affect the validity of his acts. The present case involved the complete failure of the Tribunal to meet as such and to be constituted as Parliament provides. The basis of the de facto doctrine supports its inapplicability in circumstances such as the present. “….. An officer de facto is one who has the reputation of being the officer he assumes to be, and yet is not a good officer in point of law”: R v Corporation of the Bedford Level (1805) 6 East 356 at 368-369; 102 ER 1323 at 1328. It is difficult to see how a judge could have a reputation of being a judge and two assessors. True the statute empowers him to act by himself if the assessors, having been duly summoned, do not turn up. But this is a question which must arise afresh in each new case. It is not capable of being the subject of reputation.

Thirdly, the de facto officers cases have developed “as a matter of policy and necessity” to protect those litigants whose interests are affected by the apparently official acts of persons who purport to exercise official powers. The doctrine should not be extended to a case, such as the present, where what is involved is an industrial award having quasi legislative force upon large numbers of persons not immediately involved in the litigation. True it is, declaring the award void and quashing it will cause industrial inconvenience. But that is not a reason to invoke the public officers “doctrine”. Indeed, the widespread operation of the purported award, made invalidly, is on the contrary, a reason to insist upon due observance of the law. Otherwise the rule of law and compliance with the requirements established by Parliament will be ignored by reference to a “doctrine” whose operation should be strictly confined.”

45 Mr Ashhurst and Ms Allars pointed to the fact that G J Coles &Co Limited v Retail Trade Industrial Tribunal concerned the validity of the constitution of the Tribunal, rather than the validity of the appointment of particular members to it. However, even though that may be so, in my opinion, it does not affect the outcome of this case. In my view, to uphold the validity of the Tribunal’s decision would be to allow the common law doctrine of de facto officers to negate the clear statutory policy evidenced by clause 4(1).

46 I hold that the Tribunal’s decision was invalid as the Tribunal was not constituted according to law.

THE TRIBUNAL’S DECISION CONTRAVENED CLAUSE 4(3)?

47 Mr Ellicott submitted that the document containing the reasons for decision of the Tribunal indicated, on its face, that the two members of the Tribunal appointed to assist Mr Donald constituting the Tribunal participated in the adjudication contrary to clause 4(3). In considering that submission, it is necessary to examine in some detail the document itself. The cover sheet, headed Administrative Decisions Tribunal NSW, indicated that the matter was “Before: Donald B G Judicial Member; Fagg N – Non-Judicial Member; Griffiths G – Non-Judicial Member”. Paragraph 5 of the reasons read:

“All claims are clearly within the jurisdiction of the ADT under the Retail Leases Act and the Tribunal was duly constituted for hearing unconscionability claims under Pt 7A, with a Judicial Member presiding and two Members, expert in retail commercial business and dealings”.

48 Throughout the reasons, which comprised 106 paragraphs, there were numerous references in the first person plural and none in the first person singular. The following quotations are illustrative, the numbers corresponding with numbered paragraphs in the reasons:

“6. ……..In those circumstance, the Tribunal was not assisted with WBH’s version of much of what transpired and subject to ensuring we have been properly satisfied on the evidence, we have been guided by the documents and the Lessee Sarker’s evidence as finalised during and after cross-examination.

20 We here note that despite much argument during interlocutory proceedings as to whether India is part of Asia, this was not an issue pressed at final hearing and for what it is worth, we are of the firm opinion that it simply cannot be contended that ‘Asian Grocery’ as a permitted use description does not include Indian food products………………

26 ……………………….. On balance we accept Ling’s evidence and conclude that the WBH lawyers on their behalf did not express any particular urgency about the guarantee while not in any way suggesting it was not required.

35 We note there was no evidence from WBH on the basis of which its lawyer could have asserted “many of which have been previously expressed to you”. We find no concerns had previously been expressed.

46 …………… We think the assertion is plainly wrong in the context of the Court’s order in proceedings to restore a right to trade in a shop which must include restoring stock removed in the dispossession.

68 In ordinary commercial terms and based on our respective experience of commercial dealings we summarise what has happened in the following way. We are satisfied on all the evidence that:
(a) …………………………………..
(b) …………………………………..
(c)…………………………………..
(d) We do not think it can seriously be contended that India is not part of Asia and that Indian goods do not fall within the generic description of Asian Groceries Shop as permitted trading items. Accordingly we consider it was commercially astonishing for WBH to have tried to fix the problem by sticking with that proposition.
…………………………………
………………………………….

69. Accordingly, as commercial people, we consider the conduct of WBH to be quite unacceptable in the ordinary management of a retail shopping centre having regard to usual industry standards and practices. The question is whether under the law governing the rights and obligation between these two parties, WBH was entitled to pursue the course it did.

79 The factual inquiry we therefore must make should have regard to the whole situation, not merely whether certain terms may have been declare “essential” terms entitling termination.

80 We are firmly of the view that no reasonable lessor in these circumstances could have regarded Sarker’s conduct at the time of either the first or second notice as a complete disavowal of the lease or his obligations under it……………………………………………..

81 Therefore we do not accept WBH’s contention that
Sarker has repudiated his lease such that it can terminate that lease………………………….…..

82 On the other hand, we do think WBH has repudiated the lease by its relentless campaign beginning with a surprise lock out and proceedings over six months of the most intensive legal war ……………………………………………….
83 Therefore we consider Sarker was entitled to terminate the lease.

86 We also consider that WBH had engaged in unconscionable conduct in terms of Part 7A of the Retail Leases Act. The parts of s 62 which we think apply are:-
88 In our assessment, WBH was exploiting its own loose management of both the fit out system and the security by way of bank guarantee………………
89 In our opinion this entitles Sarker to recover compensation under s. 72AA of the Retail Leases Act and also to an ancillary order that he is entitled to terminate the Lease………………………………….
91 …………. His lack of working capital had given us concern in that regard but we do not need to determine this issue.
93 ………….. we consider that as between the parties the proper award of rent would be for three such rent payments i.e. $12, 127.50.
94 We agree that the security deposit should be refunded to Sarker in the same amount, $12,127.50
95 …………… Accordingly we would not be satisfied that more than $20,000 should be allowed for lost or damaged stock during the July – January period. We allow $20,000.
97 ……………..Accordingly we think the insurance claim should be reduced by one-third. We allow $1006.94.
98 There is no evidence from Mr Sarker as to why this was necessary for him to establish sources of supply or that he actually used any such sources when trading. We do not allow this claim.
102 In summary we assess the total loss at $80,630.77.
105 In all of those circumstances we think it would be seriously unfair for costs not to be awarded to Sarker”.

49 Counsel for the Defendants, in submitting that there was no breach of clause 4(3) relied on the presumption of regularity and the proposition that the repeated use of the first person plural pronoun was no more than a manner of speech. As to the common law presumption that official acts are presumed to have been done rightly and regularly, the essence is that it is rebuttable. The difficulty in this case with the Defendants’ argument, as I see it, is that paragraph 5 of the reasons of the Tribunal, on its face, indicates a fundamental misapprehension as to the constitution of the Tribunal. It was not constituted by 3 persons, but by one person alone, namely Mr Donald. The other members did not constitute the Tribunal, but were there to advise and assist it, pursuant to clause 4 (2). Of course, the misapprehension, which I think was evidenced by paragraph 5 of the reasons, was not necessarily fatal, but I have looked in vain throughout them for some indication, however slight, that Messrs Fagg and Griffiths were not participating in the adjudication. I have found none, but to the contrary, all the relevant references indicate, to my mind, that all three regarded themselves as constituting the Tribunal and participated in its adjudicary functions. In the circumstances, I would regard any presumption of regularity as rebutted.

50 I reject the argument that the use of the first person plural was merely a figure of speech, the so-called “royal plural”. As a matter of plain English, I do not think this to be so. Unless Mr Donald believed that he was including Messrs Fagg and Griffiths in the decision making process, there was, in my view, no apparent reason to write in the first person plural.

51 Many cases attest to the proposition that statutory tribunals must adhere closely to the requirements of the statute under which they operate. G J Coles & Co Limited v The Retail Trade Industrial Tribunal, referred to above and Tu v University of NSW (2003) 57 NSWLR 376, being but two examples. Once the inference is drawn, and I draw it, that the two members appointed to assist Mr Donald participated in the adjudication, then such adjudication, in my opinion, cannot stand.

ORDERS:

1. I order that the decision of the Tribunal published on 25 June 2004 be set aside.

2. I order that the case be remitted to the Tribunal to be heard and decided again by a Tribunal constituted according to law.

3. I order that the First Defendant, Mr Abdul Sarker, pay the Plaintiff’s costs of the appeal.

4. I order that there be granted to Mr Sarker an indemnity certificate, pursuant to section 6 of the Suitors Fund Act.

5. I make no order in respect of the costs of the Second and Third Defendants.

6. I order that the costs of the first hearing before the Tribunal be at the discretion of the member constituting the Tribunal at the second hearing.

7. Liberty to all parties to apply on 7 days notice.

Last Modified: 12/17/2004