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NSW Crest

Supreme Court
New South Wales

Medium Neutral Citation:
B.S Fisher & E.A Fisher v Roads and Maritime Services [2014] NSWSC 858
Hearing dates:
12 May 2014
Decision date:
03 July 2014
Jurisdiction:
Common Law
Before:
Adams J
Decision:

1. Declare the determination of the first defendant dated 22 January 2014 and the review decision dated 26 February 2014 are invalid.

2. Set aside the determination in order 1.

3. The first and second defendants to pay the plaintiff's costs.

Catchwords:
ADMINISTRATIVE LAW - cancellation of plaintiff's accreditation - jurisdictional error - failure to take into account a relevant consideration
Legislation Cited:
Transport Administration Act 1988 (NSW)
Passenger Transport Act 1990 (NSW)
Passenger Transport Regulation 1997 (NSW)
Administrative Decisions Review Act 1997 (NSW)
Cases Cited:
Hill v Green (1999) 48 NSWLR 161
Marine Hull Liability Insurance Co Ltd v Hurford (1985) 10 FCR 234
Marine Hull Liability Insurance Co Ltd v Hurford (1986) 10 FCR 476
Queensland Newsagents Federation Ltd v Trade Practices Commission (1993) 46 FCR 38
Twist v Randwick Municipal Council (1976) 136 CLR 106
Minister for Immigration and Multicultural Affairs v Bhardwaj [2002] HCA 11; 209 CLR 597
Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1985-1986] 162 CLR 24
Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355
Category:
Principal judgment
Parties:
B.S Fisher & E.A Fisher (plaintiff)
Roads and Maritime Services (first defendant)
Transport for NSW (second defendant)
Newcombe Coach Lines Pty Limited (third defendant)
Representation:
Counsel:
D Randle (plaintiff)
A Gerard (first and second defendants)
J Castaldi (third defendant)
Solicitors:
Michael Kreveld Legal (plaintiff)
Hunt & Hunt Lawyers (first and second defendants)
Moray & Agnew (third defendant)
File Number(s):
2014/107809

Judgment

Introduction

1The partnership of Mr and Mrs Fisher operates a public passenger service by way of private charter and school bus services. These services were operated pursuant to a contract with Transport for NSW, a government agency constituted by the Transport Administration Act 1988 (NSW). In order to carry on the services it was necessary that the partnership be accredited pursuant to Div 1 of the Passenger Transport Act 1990 (NSW) (the Transport Act). The power to vary, suspend or cancel accreditation resides with another government agency, the Roads and Maritime Services (RMS) also constituted under the Transport Administration Act. (These parties are referred to as the defendants. The third defendant filed a submitting appearance and is not the subject of any findings.)

2The partnership's accreditation was cancelled on and from 22 January 2014. The plaintiff complained that this decision was made without any kind of prior notice, express or implied, by RMS that it proposed, let alone intended, to take this course of action. They commenced proceedings for review of the decision under the Administrative Decisions Review Act 1997 (NSW) (the Review Act) and sought a stay. During the hearing of the stay application on 5 February 2014, Mr Fisher withdrew the application after a short adjournment to obtain legal advice and informed the Tribunal he wished to apply to RMS for an internal review, which he immediately made by handing to RMS's solicitor an application for internal review and an affidavit in support. On 26 February the cancellation was confirmed, relying on some matters additional to those relied on by the original decision maker.

3As the partnership was no longer accredited, the contract with Transport for NSW was terminated on 22 January 2014.

4On 9 April 2014 the partnership commenced proceedings in this Court seeking, as interim relief, an order that the defendants be restrained, in substance, from treating as valid the cancellation of the plaintiff's accreditation and the following substantive orders -

"4. The determination of the First Defendant dated 22 February 2014 cancelling the public transport accreditation relating to the Plaintiff is declared invalid and set aside.
5. The First and Second Defendants are restrained from acting upon, implementing, carrying into effect or otherwise treating as valid the purported cancellation of the Plaintiff's accreditation as a public transport operator under the Passenger Transport Act 1990."

It is evident that the purpose of obtaining the relief sought was to contend (outside these proceedings) that the termination of the contract proceeded upon a void cancellation and was therefore ineffective. Whether, even if the decision to cancel accreditation were vitiated by procedural unfairness or error of law (jurisdictional or otherwise), it would be a nullity in the sense implicit in the proposed contention is discussed further below.

5RMS and Transport for NSW opposed the grant of any relief to the plaintiff on the basis that there was no denial of procedural fairness in the circumstances and, at all events, any denial of procedural fairness was cured by the reconsideration of the original decision by the internal review conducted on the plaintiff's application, as to which no suggestion of procedural unfairness is made. They also submit that the appropriate tribunal for determining the issues agitated by the plaintiff is the NSW Civil and Administrative Tribunal and, accordingly, this Court should exercise its discretion against granting relief.

Background

6The plaintiff was initially accredited in June 2003 and purchased a number of bus runs which were operated pursuant to a long term contract ultimately taken over by Transport for NSW as I understand it. The contract permitted immediate termination if the plaintiff ceased to be accredited. At the time of cancellation of the accreditation the contract had about two years to run although it might have been extended pursuant to the standard terms. Since accreditation was, at all events, a necessary prerequisite, its cancellation necessarily required termination.

7On 4 December 2013 the compliance officer of Transport for NSW for the northern region, Ms Poole, notified the plaintiff that it was intended to perform a contract audit on 10 December 2013. Mr Fisher protested at the short notice. After an email exchange Ms Poole clarified the purpose of the audit, which was pursuant to a clause of the contract entitling Transport for NSW to obtain information relating to the servicing and management of the plaintiff's buses, expressing a concern about the partnership's financial ability to operate the bus runs and maintain the appropriate level of service. The information required comprised maintenance records, inspection reports, drivers' rosters and daily running sheets and further required that the buses to be available for inspection on 10 December 2013. Mr Fisher protested at the suggestion that there was serious concern about the partnership's financial capacity to operate the services, to which Ms Poole simply responded that there was a contractual obligation to produce the business documents set out in the notice and noted that the consequence of not complying was that this "may result in Transport for NSW taking further action against you". Mr Fisher responded with indignation that the short notice was not justified, couching his response in immoderate language regrettably facilitated by the convenient immediacy of email as a mode of communication, the bottom line of which was to state that he and Mrs Fisher would be unavailable on the proposed date. By way of (polite) response, Ms Poole agreed to conduct the audit in the new year and noted, however, that the documents requested were required to be produced on demand by an authorised officer and, if not, failure might incur a penalty of $1100 pursuant to clause 19 of the Passenger Transport Regulation 1997 (NSW). Ms Poole pointed out the obligation of Transport for NSW to ensure compliance of operators with maintenance requirements and that they have the financial capacity to operate the approved number of buses. She added that information received by Transport for NSW suggested that the appropriate standards in these respects were not being met and therefore the maintenance records must be made available. Mr Fisher responded later on the same day, again using indignant and immoderate language but, in substance, agreeing to be available in the New Year and protesting about what he asserted was harassment. On 22 January 2014, without further notice, the plaintiff was notified that their accreditation had been cancelled as at that date. It was not suggested that any urgency required an immediate decision.

The course of argument

8It is not necessary to set out here the reasons for the decision said to have been relied on, since the Fishers do not seek to argue the merits of decision or contend that any matter relied on was mistaken or immaterial. Rather, it is submitted that notice of the intended cancellation should have been given before the decision was made. A further ground was added during argument based upon the apparent failure of the decision maker to consider whether, in accordance with s 10(1) of the Passenger Transport Act the accreditation should have been varied or suspended rather than cancelled. It is apparent from the statement of reasons that no such consideration had been given. This was not disputed by counsel for the defendants.

9Although the defendants submitted that there was no denial of procedural fairness in the making of the first decision, they contended that, if it were so affected, this was cured by the proper conduct of the review which had been sought by the plaintiff and considered all the material provided by them. No argument was directed to either of these contentions, the focus of the defendants' case being the submission that, at all events, the Court would decline to grant relief in light of the procedures available under the Review Act. This latter contention was also directed to the amendment of the summons concerned with the alleged failure of both decision makers to consider variation or suspension rather than cancellation of the partnership's accreditation although it was also submitted that there was no such failure or, if there had been, there was no requirement to consider the alternatives.

The availability of alternative relief

10Leaving aside an application to the Tribunal, an alternative procedure was available by way of internal review pursuant to s 53(5)(a) of the Review Act and, moreover, was availed of by the partnership. The decision of the review officer is not the subject of the present proceedings as no orders in respect of it are sought. As previously stated, the crucial matter sought to be determined by the partnership is the validity of the initial decision for the reason mentioned. The difficulty with this approach, considered alone, is that the accreditation of the partnership remains cancelled pursuant to the decision of the review officer, with consequent effect on the continuation of the bus contract.

11The Review Act gives to the Tribunal a comprehensive suite of powers to deal with the issues raised by impugned administrative decisions, its fundamental duty under s 63(1) being "to decide what the correct and preferable decision is having regard ... to (a) any relevant factual material [and] (b) any applicable ... law". By s 63(2) the Tribunal may exercise all of the functions able to be performed by the decision maker and, by s 63(3) the Tribunal may affirm, vary, set aside, or substitute a new decision for the impugned decision or, if it decides to set aside the decision, remit the matter for reconsideration in accordance with any directions or recommendations of the Tribunal. Section 66 enables a decision to take effect on the date in which it is given or any later date as may be specified. In addition, s 66(2) provides that where a decision varies or replaces a decision, the decision of the Tribunal is taken to be the decision of the administrator (s 66(2)(a)) and to have been effective as the decision on and from the date it was originally made unless the Tribunal orders otherwise (s 66(2)(b)). However, the partnership does not seek a new decision. It seeks simply the obliteration of the original decision (ie, a declaration to the effect that it was a nullity) upon which, as an accident of chronology, the decision to terminate rested. That this would leave the review decision confirming the cancellation is not the subject of submissions.

12It is accepted by the parties that "an adequate right of appeal ordinarily provides the appropriate remedy for a denial of procedural fairness at the stage of initial determination": Hill v Green (1999) 48 NSWLR 161 per Fitzgerald JA at [157], citing Marine Hull Liability Insurance Co Ltd v Hurford (1985) 10 FCR 234; applied Marine Hull Liability Insurance Co Ltd v Hurford (1986) 10 FCR 476; Queensland Newsagents Federation Ltd v Trade Practices Commission (1993) 46 FCR 38. His Honour went on to cite the various judgments in Twist v Randwick Municipal Council (1976) 136 CLR 106, pointing out that, there, both the initial determination and the right of appeal were part of the same statute and, accordingly, the usual construction of those provisions would lead to the conclusion that the remedy provided by an enactment in relation to an impugned initial determination would usually be conclusive and "empowering the Court to refuse any remedy other than that provided for by the Act creating the right in its discretion" (ibid at [162]).

13His Honour went on -

"[163] Other decisions establish that there is a discretion to refuse declaratory, injunctive or prerogative relief when an adequate alternative remedy such as an appeal, is available ...
[164] In my opinion, the position can be broadly summarised as follows. In the absence of 'plain words of necessary intendment', an initial decision-maker is required to provide procedural fairness and his or her failure to do so will involve legal error. However, the relief available in respect of such an error is ordinarily confined to any statutory right of appeal, provided that an appeal is adequate to provide the appellant with the procedural fairness to which he or she is entitled. A full appeal on facts and law will ordinarily be adequate for that purpose, even if the appeal involves routine forensic disadvantages compared to a 'first instance' re-determination... Nonetheless, the Court retains a discretion to grant other relief if that is justified in the circumstances of the case. For example, a person charged with a disciplinary offence which involves criminal conduct should not be obliged to give evidence and expose himself or herself to the risk of self-incrimination..."

14Here, s 52 of the Transport Act permits applications for review of decisions in respect of, amongst others, cancellation of accreditation to be made to the Civil and Administrative Tribunal under the Review Act. Although, having regard particularly to the ability to consider the merits of the original decision and backdate its own decision, the powers of the Tribunal are considerably wider than those of the Court exercising its supervisory jurisdiction, this appears to be insignificant when the moving party is content with such orders as this Court can make. The partnership seeks orders declaring the first decision invalid and restraining RMS and Transport for NSW from, in substance, treating this decision as valid for any purpose. Arguably, such an order could not be made by the Tribunal, at least where the ground for the asserted invalidity is a denial of procedural fairness, which of course, the Tribunal would afford.

15That a denial of natural justice renders a decision invalid is, perhaps, correct but quite what is meant by and follows from this "invalidity" is not altogether clear. The language of "void", "voidable", "invalid", or "nullities" to describe impugned administrative decisions has been deprecated (admittedly in a somewhat different context but nonetheless presently apt): Minister for Immigration and Multicultural Affairs v Bhardwaj [2002] HCA 11; 209 CLR 597 per Gaudron and Gummow JJ at [46]; see also Gleeson CJ at [12]. In these passages, their Honours emphasised the importance of the statutory scheme in which the administrative decision came to be made. Here, it is clear, the original decision was at least valid for the purpose of entitling the partnership to the internal review provided by the Review Act. Whether it was valid for the purpose of terminating the contract is rather uncertain but, since I am not asked to pronounce on this question, I do not propose to answer it. I should add that using any other of the indicators of a problematical decision (such as "void", "vitiated", "quashed") do not resolve this question: each consequence must be considered in the precise context in which the decision was made and the actions to which it gave rise.

16It seems to me that the review decision cannot be attacked for procedural unfairness and, if there were no other basis for attacking its validity, the cancellation must stand - at least from 26 February 2014.

Additional ground

17This ground, in substance, alleges a constructive failure to exercise the jurisdiction conferred on the defendants by not considering whether, in the circumstances the suspension or variation of the Fishers' accreditation was appropriate, this being a mandatory consideration under s 10 of the Transport Act, which is in the following terms -

"(1) Having regard to the purpose of accreditation, RMS may at any time vary, suspend or cancel any person's accreditation."

18Where a decision-maker fails to take into account a relevant consideration which he or she is bound to take into account, this is a jurisdictional error entitling the aggrieved person to prerogative relief unless it is so insignificant that the failure to do so could not have materially affected the decision: Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1985-1986] 162 CLR 24 per Mason J at 39-40.

19It cannot be doubted that there is power to vary, suspend or cancel accreditation. This power must be exercised with regard to the purpose of accreditation, in substance, to effectuate that purpose. This is set out in s 7(2) as attesting that the accredited person is of good repute and fit and proper to be responsible for the operation of a public passenger service and has capacity to meet the government standards of financial viability, safety of passengers and the public and vehicle maintenance. Necessarily, these are matters of fact and degree and, in any case, might justify one of the three consequences specified in s 10(1). Thus, a failure of itself in any or even all of the matters attested by accreditation might not justify cancellation: this must depend on the nature and extent of the failure. The decision maker must first identify the fault and the degree of shortcoming and then assess which of the consequences should follow to answer the fault. The requirement to consider which of the three consequences is appropriate in the particular case is mandatory. The unconditional language of the sub-section and its function in giving a discretionary power to impose consequences for a necessarily evaluative decision implies to my mind the purpose that a decision which ignores the potential available outcomes is invalid: see Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 at [93].

20In this case, the reviewer held that Mr Fisher was not "a fit and proper person to hold accreditation to operate public passenger services" apparently relying on material that suggested he was not honest in certain respects. The reviewer went on to say -

"Accordingly, as each partner in the entity is vicariously liable for the actions of the other party, the entity cannot be considered to be fit and proper to provide public passenger services".

The reference to vicarious liability is not obviously appropriate. It may be accepted that, if (as here) the party which is accredited is the partnership, failure by one partner means that the partnership no longer satisfies the criteria. However, this might lead to a consideration of whether some substitution of partner might be appropriate or, indeed, varying the accreditation to limit to the party not affected by the adverse consideration. I am not suggesting, of course, that any of these consequences should have occurred, simply pointing out that reference to the criteria for accreditation as being the only matters specified as requiring consideration cannot, either in principle or as a practical matter, determine the question whether consideration must be given to the possible consequential decisions. (I cite this issue by way of example of the kind of evaluative judgment that would, or should, give rise to a consideration of the possible alternatives to cancellation and do not suggest that no other matters might reasonably have provoked the same consideration.)

21It is submitted for the defendants that, at all events, reading the reasons with the appropriate degree of latitude, it should be accepted that the decision makers, having quoted s 10 of the Act, should be taken as having considered the specified possibilities although no reference was made to them. The initial decision did not mention the possible alternatives. The review decision, following some uncontroversial references to relevant legislative provisions, commenced with the following -

"The delegate of Transport for NSW relies on the following facts, evidence and material to cancel your accreditation ..."

and then set out the material referred to by the initial decision-maker and what is described as "the reasoning process that led to the decision", none of which included consideration of the alternatives to cancellation. Although the conclusion as to unfitness related only to Mr Fisher, Mrs Fisher was held to be "vicariously liable" for his actions. Hence, the decision to cancel the accreditation of the "entity" was affirmed. In my view, the lack of any reference to suspension or variation in the context of the particular matters relied on for the cancellation justifies the inference that they were not considered. Both the reviewer and the original decision maker) erred in failing to consider the alternatives provided by s 10(1) of the Transport Act.

Should relief be refused?

22Accepting, as I do, that it is unusual that this Court would not refuse to grant an order by way of certiorari or declaration where adequate relief can be obtained under the Review Act, it seems to me I should not refuse relief in this case. It was not at all unreasonable that the Fishers sought to proceed by way of internal review, if only to save legal costs and delay. I think I must accept that their decision to come to this Court rather than to go to the Tribunal for relief in respect of the impugned decision, based upon a mistaken understanding as to the significance of a finding that the original decision was a nullity with, as it were, knock on effects, vitiating the termination of their contract, was a considered one nevertheless. However, the partnership is a small business and there is evidence upon which, as it happened, the defendants relied for the purpose of cancelling the accreditation that it was struggling financially, a situation which would certainly have been made worse by the termination of the Fishers' contract. Since the decision is a straightforward one, as I see it, in relation to a purely legal question and I have formed a definite view about it, it would be harsh to decline relief and force the Fishers to undertake further legal proceedings.

Conclusion

23Accordingly, I declare the determination of the first defendant dated 22 January 2014 and the review decision dated 26 February 2014 to be invalid and set them aside.

24Although the Fishers seek orders restraining the defendants from acting upon, implementing, carrying into effect or otherwise treating as valid the purported cancellation of the plaintiff's accreditation, it is unnecessary for me to make this order prospectively, since the first order suffices to vitiate the cancellation of their accreditation. At all events, I do not see that there is any utility in making such an order since the only practical consequence sought by the plaintiff was that, in some way, the invalidation of the accreditation decision might have ex post facto effect on the termination of the contract. Such an outcome was not specifically sought, counsel for the plaintiff conceding that the basis for seeking such an order was, to say the least, problematical. Accordingly, I decline to make the further orders sought in the summons.

25The first and second defendants must pay the plaintiff's costs.

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Decision last updated: 03 October 2014