Young and Anor and Secretary, Department of Agriculture, Fisheries and Forestry - [2002] AATA 1231

DECISION AND REASONS FOR DECISION [2002] AATA 1231

ADMINISTRATIVE APPEALS TRIBUNAL )

) No Q2002/993

GENERAL ADMINISTRATIVE DIVISION          )
           Re      BARRY YOUNG PIONEER SEAFOODS PTY LTD
  Applicant
           And    SECRETARY, DEPARTMENT OF AGRICULTURE, FISHERIES AND FORESTRY
  Respondent

DECISION

Tribunal Mr O Rinaudo, Member

Date29 November 2002
PlaceBrisbane

Decision In accordance with section 41 of the Administrative Appeals Tribunal Act1975 THE TRIBUNAL DECIDE THAT the application for stay of the decision under review is granted.

……(Sgd) Mr O Rinaudo...…
Member
CATCHWORDS
PRACTICE AND PROCEDURE – stay application – whether applicants will suffer financial hardship – prospects of success of substantive application

Administrative Appeals Tribunal Act 1975
Export Control Act 1982
Prescribed Goods (General) Orders 1985
Veterinary Chemicals Administration Act 1992

Island Voice and Great Barrier Reef Marine Park Authority (AAT No 5685C, 25 August 1989)

REASONS FOR DECISION

29 November 2002 Mr O Rinaudo, Member

ORDERS SOUGHT

The Applicants seek and order that:
"The implementation of the decision to revoke the registration of establishments 3143 at Gladstone, 3177 at Bowen and 6770 at Mackey be stayed pending the hearing and determination of the Application for Review on the Applicant's undertaking, hereby given, to prosecute that Application with all due diligence."

The Applicant says as grounds for the request that:
"The decision, if not stayed, will render the application for review nugatory because, by the time the application is heard and determined, the applicants' business will have been ruined."

POWER OF TRIBUNAL TO STAY PROCEEDINGS

The power of the Tribunal to stay proceedings in contained section 41(2) of the Administrative Appeals Tribunal Act 1975, which provides as follows:
"The Tribunal or a Presidential Member may, on request being made, as prescribed, by a party to a proceeding before the Tribunal (in this section referred to as the 'relevant proceeding'), if the Tribunal or Presidential Member is of the opinion that it is desirable to do so after taking into account the interests of any persons who may be affected by the review, make such order or orders staying or otherwise affecting the operation or implementation of the decision to which the relevant proceeding relates or a part of that decision as the Tribunal or Presidential Member considers appropriate for the purpose of securing the effectiveness of the hearing and determination of the Application for Review."

FACTUAL BACKGROUND

The corporate applicant, Pioneer Seafoods Pty Ltd (Pioneer), conducts the business of purchase, processing and sale for domestic market and for sale for export of live fish. Mr Barry William Young (Young) is the Managing Director of Pioneer.
Pioneer held the necessary export licence to allow it to conduct business as an exporter of chilled and frozen seafood. Both Pioneer and Young were regarded as fit and proper persons to allow the export licence to be maintained.
In about August 2000, Commonwealth officers acting under the authority of the Export Control Act 1982 carried out searches of the applicants' premises and discovered that the applicants were using a banned substance in the course of its business.
Charges were laid against both Pioneer and Young. In about May 2002, they both pleaded guilty in the Magistrates Court and were fined.
As a result of the convictions the respondent considered the standing of the applicants as fit and proper persons to hold the required export licence. After consideration the respondent decided in September of 2002 to regard both Young and Pioneer as not fit and proper persons in accordance with order 47 of the Prescribed Goods (General) Orders 1985.
In doing so the respondent said that the decision was made because:
"Mr Young, by his own admission, imported and used a veterinary chemical that has been found to be dangerous to human health, knowing that it was not a chemical approved for use on live fish in Australia. Mr Young used it on live fish."

It is alleged that Mr Young has showed no contrition for his actions, and "justified his use of the chemical by reference to practice and the need for him to maintain commercial competitiveness".
The respondent further justified its actions on the basis that use of the chemical "could have a detrimental effect on the live fish export industry in Australia generally and on Australia's reputation as an exporter of safe foods".
In so far as the company is concerned the respondent determined that it was not a fit and proper person to hold the licence on the basis that it had "been convicted of an office against a law of the Commonwealth being the Veterinary Chemicals Administration Act 1992".
By application lodged with the Tribunal on 15 November 2002 the applicants seek a review of the decision.
EVIDENCE AND SUBMISSIONS
It was first indicated that if a hearting date could be provided in December it would not be necessary to proceed with the stay application. Even though a hearing date could be accommodated in December 2002, the respondent was not able to be ready in December but agreed that hearing could go ahead in February on the first available date after the 17 February 2002.
The stay application proceeded. Tribunal was provided with an affidavit of Young. It is a one-page document, which states simply that Pioneer wishes to pursue the application for review:
"however without an export licence it cannot pursue its business profitably. It is, in my view, likely that Pioneer's business will be greatly affected if, until the Tribunal hears and determines the application, it cannot operate on an export basis. With its current cash reserves Pioneer will become insolvent within 3-4 months and it is likely that I would need to consider winding up Pioneer".

This assertion was not made with any supporting evidence. Counsel for the respondent sought to cross-examine Young about the assertions.
The Tribunal had been given an affidavit by an employee of the Australian Quarantine Inspection Service (AQIS) which set out in some detail the number weight and average cost of export consignments of Pioneer between 1 November 2001 and 1 November 2002.
This affidavit pointed out that Pioneer had exported ninety consignments of live fish and ten consignments of frozen product in the period. The average cost of the live exports was $64,402.00 as compared with average cost of the frozen product of $11,720.00.
Young had conceded in his affidavit that only the export of chilled or frozen seafood was affected by the decision.
Under cross examination Young explained that "it is not as simple as that" because the service Pioneer provides includes chandlery for the boats as well as purchase of their catch. In was not possible to attract boats whose catch included chilled and frozen product because there was nothing that Pioneer could do with this product. If they were to buy this product and sell it domestically they would be losing substantial monies.
Without being able to attract boats Pioneer was losing out on the sale of petrol ice chandlery products and the profit from the purchase and sale of the catch, so that the loss was compounded.
In answer to questions from counsel for the respondent Young acknowledged that sale of live fish were not affected by the decision and accepted the validity of the figures as presented by the respondent in the affidavit of the employee of AQIS.
Again Young indicated that this did not show the whole picture as it did not show the amount of stock that was exported by third parties from whom Pioneer received a percentage margin. Pioneer exported some stock in its own right but on sold large amounts to these third parties for export by them. The figures did not show these amounts. Young told the Tribunal that Pioneer employed about sixty people.
In submission by counsel for the applicant the Tribunal was told that the stay should be granted as there was a real possibility that by the time of the hearing the applicants may be out of business thereby rendering the application nugatory. It was also submitted that as the applicants were ready to proceed with the application they should not be further disadvantaged simply because the respondent could not be ready. The applicant's counsel submitted that the application had substantial prospects of success and rejected the respondent's submission that prospects were poor.
Counsel for the applicant contended that it was not necessary in proceedings such as these to provide substantial detail of the applicant's financial position it was simply enough for the applicant to say that there was a serious prospect that the applicants may be out of business by the time of the hearing.
Counsel for the respondent submitted that the Tribunal should have regard to the principles applicable to the grant of a stay as discussed by Bulley J in Island Voice and Great Barrier Reef Marine Park Authority (AAT No 5685C, 25 August 1989) at page 9.
The respondent's counsel addressed his submissions based on these principles saying that the applicants had poor prospects of success and that the applicants had failed to show financial hardship. In this regard counsel for the responded stated that such hardship must involve more than just loss of profit. He said that there must be sufficient evidence to establish the applicants' financial position and that the onus for this must be on the applicants.
The Tribunal was urged to reject the application on the basis that there was no substantiated financial hardship and there were poor prospects of success.
REASONS FOR DECISION
The Tribunal has considered carefully the evidence as presented by the applicants and the respondent, as well as the submissions of counsel.
Whilst it is accepted that the applicants have not provided supporting evidence to substantiate the financial position asserted by Young it is clear that the decision to revoke the export licence of Pioneer must have a detrimental effect on Pioneer and therefore on its workforce. I am satisfied by the evidence of Young that the financial position is not as simple as asserted by the respondent. Whether the applicants will go "broke" before the hearing is another matter. In this regard I note from the authority noted above that I must consider "any hardship which a party to the review may suffer by reason of the grant or refusal of a stay". It seems clear that there will be hardship in this instance.
In so far as the prospects of success of the substantial application are concerned I am not satisfied that there are poor prospects. The decision under review is a decision based on the exercise of discretion. In such cases regard must be had to the proper exercise of the discretion having regard to all issues of relevance. Although it was asserted that since the applicants were convicted of offences against both state and federal law there is little prospect of overturning the exercise, I cannot accept this. On review the applicants will be required to show that the discretion was incorrectly exercised. Without knowing exactly what it is that the applicants will assert it is impossible to say their prospects are poor.
I have considered three other issues. Firstly, it appears that the applicants have never been involved in any behaviour which has been called into question before. Whilst I accept that that may be more good luck then good management it still remains that their conduct has not been called into question before this event.
Secondly, the time between the initial search of Pioneer's premises and the decision is over two years. During this time the applicants, I am told, have complied in all respects with their obligations. I was informed that there is no likelihood of a repeat of the offences.
Thirdly, since the hearing will now take place shortly after 17 February 2002 a further short delay in implementing the decision cannot be harmful to the respondent given the applicants' assurances to comply with the law in the meantime. The advantage for the applicant is, of course, that it removes the possibility of the business failing in the intervening months.
I consider all of these issues relevant to the application for stay in this particular case.
DECISION
Accordingly, I grant the stay until the determination of the substantive application for review.
I certify that the 36 preceding paragraphs are a true copy of the reasons for the decision herein of Mr O Rinaudo, Member
Signed:         .....................................................................................
  Associate
Date of Hearing  27 November 2002
Date of Decision  29 November 2002
Counsel for the Applicant        Mr Hack SC
Solicitor for the Applicant         Kenny & Partners
Counsel for the Respondent    Mr Flanagan SC
Solicitor for the Respondent    Minter Ellison