Supreme Court New South Wales

• Medium Neutral Citation: TEAMCARD PTY LTD v STATE OF NSW [2011] NSWSC 1008
• Hearing dates: 14 February 2011
• Decision date: 05 September 2011
• Jurisdiction: Common Law
• Before: RS HULME J

Decision

(i) The summons is dismissed.

(ii) The Plaintiffs are to pay the Defendants' costs.

• Catchwords: Public passenger service - Taxi-cab service
• Legislation Cited: Passenger Transport Act 1990 (NSW), Public Sector Employment and Management Act 2002 (NSW)
• Category: Principal judgment
• Parties: Teamcard Pty Limited (1st Plaintiff); NSW Taxi Council Limited (2nd Plaintiff); State of New South Wales (1st Defendant); New South Wales Minister for Education and Training (2nd Defendant)
• Representation: Ms CE Adamson SC with Mr C Lenehan; Ms J Needham SC with Mr JM Morris; Pigott Stinson Lawyers; Eakin McCaffery Cox
• File Number(s): 2010/405141

Judgment

1 RS HULME J: On 4 November 2010 the NSW Department of Education and Training issued a:-

Request for Tender No. DETP 1028

PROVISION OF TRANSPORT SERVICES THROUGHOUT

NSW TO THE

ASSISTED SCHOOL TRAVEL PROGRAM FOR

NSW DEPARTMENT OF EDUCATION AND TRAINING

- CREATION OF ELIGIBLE SERVICE PROVIDER LIST -

2011-2016

2 On 16 November 2010 Messrs Piggott Stinson, Solicitors acting on behalf of the Milton Ulladulla Taxis Hire Cars & Limousines and the NSW Taxi Council wrote to the Chief Procurement Officer of the Department of Education and Training suggesting that the terms of the Request unfairly prejudiced members of those organisations who were contemplating responding to the request and asking that the request be amended in certain respects. The letter set out detailed reasoning in support of the contention.

3 On 19 November 2010 Solicitors acting for the Department responded saying that the Department did not propose to amend the Request. This letter also contained detailed argument directed to countering that advanced by Messrs Piggott Stinson.

4 On 6 December 2010 a Summons commencing these proceedings was filed. As amended the Summons seeks:-

(1) An order in the nature of certiorari that the decision of the first defendant's decision or, alternatively, the second defendant to refuse the request made by the plaintiffs that the defendant amend the RFT be amended be set aside.

(2) An order in the nature of mandamus remitting to the first defendant or, alternatively, the second defendant consideration of the plaintiffs' request for amendment of the RFT for determination according to law.

(3) A declaration that the defendant's refusal by the first defendant or, alternatively, the second defendant of the plaintiffs' request for amendment of the RFT was invalid.

(4) Such further or other orders as to this Honourable Court seems fit.

(5) Costs.

Grounds

(a) The First Defendant or, alternative, the Second Defendant erroneously determined that the Assisted School Transport Program is not a "public passenger service" within the meaning of the Passenger Transport Act 1990 (NSW) (PT Act) and, on this basis:

(i) erroneously determined that the PT Act was not relevant for the purposes of the tender process generally and assessing tenders submitted by tenderers, such as the First Plaintiff, which operate a "taxi-cab service".

(ii) erroneously concluded that entities, such as the First Plaintiff, which operate a "taxi-cab service", are not constrained to charge at rates equivalent to, or less than, the maximum rates specified in the determination made under s 260A of the PT Act dated 29 June 2010, when that determination, as a matter of law, imposes such constraint; and

(iii) erroneously determined that there is no requirement that the successful tenderer be an "accredited service operator" within the meaning of the PT Act.

(b) By failing to respond to the arguments put on behalf of the Plaintiffs, the First Defendant or, alternatively, the Second Defendant failed to accord natural justice to the Plaintiffs or, in the alternative, constructively failed to exercise its jurisdiction to consider such request.

5 On 8 December 2010, "Without admissions and upon the Plaintiffs giving the usual undertaking as to damages through their counsel, the Defendant (undertook) to the court that it will not, until further order, award any tender pursuant or in respect of which tenders were invited by the" RFT.

6 It will be convenient in the course of these reasons to refer to the various documents by the description employed in the summons. There the Request for Tender was referred to as "RFT" and the Passenger Transport Act as "PT Act".

7 The Assisted School Travel Program is a program administered under the Education Act that provides travel assistance for selected disabled individual students in order to facilitate their access to education. Generally each selected student is entitled to two trips per day between their residence and school. A transport run may accommodate anywhere from 1 to 16 students. Sometimes a "Travel Support Officer" will travel with students who have needs that require additional support. The RFT states its objectives as follows:-

The objective of the RFT is to establish an Eligible Service Provider (ESP) list from which service providers will be selected to provide quality transport services based on individual student travel support requirements. The ESP list will constitute a Standing Offer between the respondent and the Department. Through the RFT process, the Department seeks to secure an adequate supply of suitably qualified service providers at prices that represent value for money.

8 The RFT also contemplates its own amendment. Clause 3.12.1 of Part B provides:-

3.12 Addenda to RFT

3.12.1 If, for any reason the Department, at its sole discretion, requires the RFT to be amended after its release and before the closing Date and Time, an addendum or multiple Addenda will be issued via the NSW Government's e Tendering Website.

9 The particular aspect of the RFT that is the subject of the Plaintiffs' complaint lies in some of the provisions of Clause 6 of Part C. So far as is presently relevant, that clause provides:-

6.1 Respondents must complete the Price Schedule at Part D, Section 1.

6.2 The tendered priced for each category of vehicle must:

(a) ...

(b) Appropriately cover reasonable costs of providing the services including but not limited to vehicle costs such as...

(d) Be expressed as a rate per kilometre for the provision of transport services, taking account of only those kilometres where one or more approved students are present in the vehicle (loaded kilometres); and

(e) Include goods and services tax...

6.6 Respondents should also consider that Department will recognise that transport runs with students who require the additional assistance of Travel Support Officer during transit may incur additional costs in terms of time and distance. For runs where the distance travelled to pick up a Travel Support Officer en-route increases the total distance travelled by more than 5km for each one way trip, an additional payment of 15% will be added to the amount payable to the ESP (a term defined to mean "Eligible Service Provider).

6.7 Taxi operators MUST tender compliant pricing i.e., Loaded Kilometre Rates for each vehicle category.

6.8 Respondents should:

(a) Not tender standard operated charges with separate flag fall, booking fees, etc;

(b) Not tender a Minimum Daily Rate; and

(c) ...

10 In Part D of the RFT there is a further notation:-

You CANNOT tender normal taxi rates if you are a taxi operator. Taxi operators MUST tender compliant prices, ie. an all inclusive Loaded Kilometre rate. If you tender normal taxi rates, including flag fall, booking fees, etc. your tender will be eliminated from further consideration.

11 Some of the terms used in the clauses quoted were defined. They include:-

"Loaded kilometres" means distances travelled with one or more approved students present in the vehicle during the course of a journey.

"Travel Support Officer" means a person engaged to provide additional supervision or support for students accessing assisted school travel services during transit.

12 As crystallised during the course of written and oral submission, it became apparent that there were basically three issues between the parties:-

(i) Whether the Department is entitled to appoint to their preferred list of service providers a person or entity other than an operator accredited under the PT Act. The answer to this question will depend on whether the proposed Assisted School Travel Program is a "public passenger service" within the PT Act.

(ii) Whether the owners or operators of taxi-cabs are prevented from nominating a "loaded kilometre rate" in excess of the kilometre rate set pursuant to s 60A of the PT Act.

(iii) Are the Plaintiffs entitled to the relief sought in the Summons? (It was conceded that the Plaintiffs had standing. The issue was whether it was appropriate for the Court to grant relief.)

13 The provisions of the Passenger Transport Act principally relied on by the Plaintiffs are:-

3 Definitions

(1) In this Act:

Accredited Service Operator, in relation to a public passenger service, means a person accredited under Division 1 of Part 2 for a service of that kind (or for services that include such a service).

Charter service means a public passenger service in which a bus or ferry or another vehicle prescribed by the regulations, and the services of a driver of the vehicle, are pre-booked for hire to take passengers for an agreed fee, but only if, according to the terms of the hire:

(a) the hirer is entitled to determine the route for the journey and the time of travel, and

(b) ...

(c) Individual fares are not payable by the passengers (either to the operator of the service or to the driver of the vehicle), and

(d) ...

Private hire vehicle means a motor vehicle (other than a bus or a taxi-cab) which is used to provide a public passenger service (other than a regular passenger service, a long distance service, a charter service or a tourist service).

Public passenger service means the carriage of passengers for a fare or other consideration:

(a) by a motor vehicle (other than a light rail vehicle) along a road or road related area, or along the whole or part of a transit way route, or

(b) by a vessel within any New South Wales waterway.

Public passenger vehicle means:-

(a) a bus used to provide a public passenger service, or

(b) a ferry ...

(c) a taxi-cab or private hire vehicle, or

(d) ...

Taxi-cab means a motor vehicle:

(a) which is used to provide a public passenger service (other than a regular passenger service, a long distance service, a charter service or a tourist service), and

(b) which, for the purpose of procuring passengers, is made to ply or stand for hire in a road or road related area.

4 . Objects

The objects of this Act are:

(a) to require the accreditation or authorisation, by the Director-General, of the operators of and drivers involved in public passenger services (other than ferry services), and

(b) to dispense with the licensing of ferries and buses used to provide a public passenger service, ...

(e) to encourage public passenger services that meet the reasonable expectations of the community for safe, reliable and efficient passenger transport services...

7 Accreditation

(1) A person who carries on a public passenger service by means of a bus or other vehicle (other than a vessel)... is guilty of an offence unless the person is an accredited service operator for that service.

11 Authorities

(1) A person who drives a public passenger vehicle (other than a ferry) is guilty of an offence unless the person is the holder of an appropriate authority under this Division.

Part 4 Taxi-cabs

29A Definitions

In this Part:

Authorised taxi-cab network means a taxi-cab network carried on by an authorised taxi-cab network provider

Taxi-cab service means a public passenger service carried on by means of one or more taxi-cabs.

30. Taxi-cab Service Requirements

(1) A person who carries on a taxi-cab service, being a service operating wholly or partly within New South Wales, by means of a taxi-cab is guilty of an offence if:

(a) the person is not accredited for the purposes of carrying on the service under Division 3...

31. Accreditation

(1) The Director-General may accredit persons for the purpose of carrying on taxi-cab services, subject to and in accordance with this Division.

Division 5 Taxi-cab drivers

33. Authorities

(1) The Director-General may, by the issue of authorities under this Division, authorise persons to drive taxi-cabs, subject to and in accordance with this division. ...

(2) A person who drives a taxi-cab is guilty of an offence unless the person is an authorised tax cab driver.

Part 4A Private hire vehicles

36A Definitions

In this Part:

Private hire vehicle service means a public passenger service carried on by means of one or more private hire vehicles.

60A Fares or other remuneration

The Director-General may from time to time, by notice published in the Gazette determine fares (including maximum fares) or approve other arrangements for remuneration in connection with taxi-cab or private hire vehicle services.

14 On 29 June 2010 the Director-General made a determination under the last mentioned section. The determination was that "the maximum fares and other remuneration payable by the hirers in respect of taxi-cab services" should be as then set out. Different maximum rates were specified for Urban and Country areas but for each area the fares were specified under the headings "Flag Fall", "Distance Rate", Booking Fee" and "Waiting Time". The Distance Rate was per kilometre and the Waiting Time in an amount per hour. There were additional provisions to cover "Maxi-cabs", "Multiple Hirings", "Night-time" use and other matters.

15 As has been said, the answer to the first question depends on whether the proposed Assisted School Travel Program" is a "public passenger service" within the PT Act. In turn, that depends on the significance and operation to be afforded to the references to "public" in that term.

16 One view of the significance of the word "public" involves merely a recognition that the carriage envisaged is over roads, road related areas, transit way routes or waterways that, as nearly all are, are public and the word is not directed to any other characterisation of the users or the service. However, when regard is had to the objects of the Act, it seems more likely that it is the public use, rather than use over public roads etc., that the Act was directed.

17 Counsel for the Plaintiffs Ms Adamson SC drew attention to the absence from the definition of "public passenger service" of any requirement that the passengers be members of the public. She submitted also that when regard is had to the fact that a "charter service" was a species of public passenger service where individual fares are not payable by the passengers, the reference in the definition of "public passenger service" to "for a fare or other consideration" meant that no significance could be attached to the fact that under the Assisted School Travel Program remuneration would be provided by the Department and not by individual passengers. Otherwise, the services envisaged by the RFT answered the definition of "public passenger service and it followed, according to the Plaintiffs' submissions, that the person providing such services must be an "accredited service operator".

18 The Plaintiffs also submitted that the PT Act should not be so construed that the legislative provisions thereby put in place for the protection of the public and to ensure that vehicles are safe and reliable could be avoided simply by adopting the device of limiting the service to a specified section of the public such as disabled children or, indeed in the case of a school bus service, children generally. There may be some weight in this argument but once it is recognised that any attempt to avoid the operation of the Act in the way for which Ms Adamson contended will almost certainly only occur through government action, recognition must also be given to the power to protect such public interests by other means.

19 For her part Ms Needham SC, appearing for the Defendants, contended that although there was no specific requirement in the definition of "public passenger service" that the passengers be members of the public, the use of the term "public" and the objects of the Act made it clear that the Passenger Transport Act was concerned with the transport of persons answering that description. She submitted that when interpreting a defined term it was relevant and necessary to consider the context and that the definition must yield to that context - see Gidaro v Secretary Department of Social Security (1998) 154 ALR 550 at [561]; Repatriation Commission v Vietnam Veterans Association of Australia NSW Branch Inc (2000) 48 NSWLR 548 at [108-109].

20 Ms Needham submitted that the Assisted School Travel Program was not being provided to members of the public. It was available only to students in need of special assistance who had made application and been approved by the Department, was available on only some days and only for the purpose of travel to and from school. She submitted that the Plaintiffs' preferred interpretation would have the effect that participants in a car pooling scheme to drive to work or to sport would require accreditation if they:-

(a) Shared petrol expenses.

(b) Set upon an agreed contribution to expenses.

(c) Had a roster whereby the consideration for one journey was an undertaking to drive the next; or

(d) A passenger contributed to the journey by paying a parking fee incurred by the driver.

21 Ms Needham submitted that such conduct would render the participants liable to prosecution and other unintended consequences would be that the following arrangements would be technical breach of the PT Act:-

(a) Rostered school runs between parents,

(b) A nanny who is paid a wage, but whose duties include running children to school,

(c) ...

(d) An employee directed by his employer to drive a co-worker to a railway station or bus stop,

(e) An ambulance officer taking a patient to hospital, and

(f) ...

22 Whether or not the interpretation of "public passenger service" contended for by the Plaintiffs would have the consequences advanced by Ms Needham, there can be no doubt that carriage under the Assisted School Travel Program as envisaged by the RTF is carriage "for a fare or other consideration". Reward will obviously be the dominant consideration in the mind of the person doing the carrying and there is no basis in the definition for concluding that the fare or other consideration must be provided by the individual passengers. What would otherwise be a public passenger service does not cease to be such because, for example, a passenger's employer has provided Cab-charge dockets to cover the cost of a journey or come to some other arrangement with the provider of the service to pay for the cost of it.

23 The definition of charter service, identifying as it does that it is a public passenger service where individual fares are not payable by the passengers supports that conclusion.

24 A number of factors are relevant to a determination of the operation of the expression "public passenger service". The first is that, although in the body of the definition of the term there is no requirement that the passengers be members of the public or carried in that capacity, it is impossible to ignore the inclusion of the term "public" in the expression. The second is to recognise that all passengers will at some time be members of the public. Thus if the reference "public" is to be regarded as referable to the passengers, it must be that it is as members of the public that they are or have become passengers or the service has been engaged. So to read the expression is to treat it as if it said something similar to, "Public passenger service means the carriage of passengers either in their capacity as members of the public or pursuant to some engagement by a person in his capacity as a member of the public ...".

25 It may be accepted that some public passenger services, e.g. charter services and taxi-cab services, once engaged and during the currency of the engagement, will no longer be available to the public. However there is nothing in the inherent nature of such services or the terms of the legislation to argue against them being or remaining, during the currency of any engagement, "public passenger services". There is nothing justifying the conclusion that, merely because at some points of time, they are not available to the public (other than whoever has engaged them), they are not "public passenger services".

26 When regard is had to the terms of the RTF it is clear that any engagement of the service providers under it will be by the Department of Education or, less probably, the particular students selected by the Department to be carried. Certainly any engagement of transport services pursuant to the RTF will not occur by anyone in the capacity of a member of the public. Thus carriage under the Assisted School Travel Program does not constitute a public passenger service and there is no need for persons providing that service to be accredited under the PT Act.

27 The second question is whether the owners or operators of taxi-cabs are prevented from nominating a "loaded kilometre rate" in excess of the kilometre rate set pursuant to s 60A of the PT Act. On behalf of the Plaintiffs it was submitted that the effect of clauses 6.1, 6.7, 6.8 of the RFT and the definition of "loaded kilometres" was that taxi operators were at a competitive disadvantage in that those clauses required them to tender only a per kilometre rate: The maximum rate they could charge per kilometre had been set in the Director-General's Determination yet it was the combination of the various rates in the Determination that was regarded by the Director General as appropriately remunerating taxi-cab operators.

28 Reference was also made to clause 6.6 and it was submitted that it introduced a further factor that would not have been in contemplation in the fixing by the Director General of a maximum "Distance Rate".

29 To these arguments the Defendants responded by contending that at any time a vehicle was being used to transport assisted students it was not available to "ply or stand for hire", it was thus not being used as a taxi-cab as defined in the PT Act, and accordingly the restrictions on charging had no application.

30 This argument must be rejected. Given the terminology used in the definition of a taxi-cab, a vehicle answering that description remains a taxi-cab even if it not being used as such at any particular time. That said, I agree with the result contended for on behalf of the Defendants.

31 The Director-General's Determination related to the provision of "taxi-cab services". A "taxi-cab service" is defined as a "public passenger service carried on by one or more taxi cabs". My earlier conclusion that the provision of services under the RFT is not a public passenger service means it is also not a taxi-cab service even if carried out by means of a taxi-cab. Hence the Director-General's determination relating to the provision of taxi-cab services has not application to the provision of services under the RFT and the operator of a taxi-cab tendering under the RFT is not limited by the Director-General's determination as to fares charged.

32 (That is not to say that none of the provisions of the PT Act still apply. Thus s 33 of the Act still requires that a driver of a taxi cab (whether or not engaged in the provision of taxi-cab services must be an authorised cab driver.)

33 These conclusions mean that there is no need for me to embark on the third aspect of the dispute between the parties, viz. whether, even if the interpretation of the legislation contended for by the Plaintiffs is correct, the circumstances are such that the Court can or should interfere with the tender process. I will merely note that in aid of its contention that the Court should grant relief, the Plaintiff's relied on the Public Sector Employment and Management Act 2002 (NSW) , Regulations made thereunder and the government's Code of Practice for Procurement"

34 The only other matter for decision is the question of costs. The Defendants' initial position was to place in issue more matters than they finally contended for, particularly the Plaintiffs' standing. Counsel for the Plaintiffs submitted that in that situation, even if the Plaintiffs lost there should be some special order for costs. However, I am not so persuaded. While I accept that some additional time in preparation was probably spent on the abandoned issues, it seems to me likely that in the overall context of the litigation, they were of limited compass.

35 It was not suggested that any declarations were necessary to reflect the conclusions at which I have arrived. In these circumstances the appropriate orders are:-

(i) The summons is dismissed.

(ii) The Plaintiffs are to pay the Defendants' costs.

Decision last updated: 18 October 2011