Friday Afternoon HCA Transcript

A couple of amusing exchanges in the hearing of Anstis, yesterday:

Commissioner of Taxation v Anstis [2010] HCATrans 183

STEPHEN GAGELER SC: Your Honours, this is a short case in a field that has been the subject of intense scrutiny by the Court in recent years. Without any preamble, can I take your Honours immediately to the relevant provisions of the Social Security Act and the Social Security (Administration) Act. I confess that I do not know exactly what form your Honours have those documents in.

HEYDON J: Mr Gageler, my infirmity is catching up with me. It is very hard to hear what you are saying.

Then there was this confusion:

MR GAGELER: .....If your Honours then move to the Social Security (Administration) Act you will see in section 3 some definitions and references to definitions. Relevantly in subsection (2) the definitions in the 1991 Social Security Act are brought in. Your Honours might also note subsection (4).

HEYDON J: I think I am not completely with your argument. Are you talking about the Social Security (Administration) Act 1999?

MR GAGELER: I am, your Honour.

HEYDON J: You took us to section 3 and then you took us to section 3(4).

MR GAGELER: Yes.

HEYDON J: What you said about section 3 does not correspond with what I have in front of me, and there is no subsection (4). Where have I gone wrong?

MR GAGELER: I am sorry, your Honour. I should have taken your Honour to subsection (3).

HEYDON J: It begins “If (a) a person makes a claim for a senior’s health card - - -

MR GAGELER: The Social Security (Administration) Act as at 24 May 2006.

HEYDON J: What is your subsection (3) again? What are the opening words?

MR GAGELER: Section 3 deals with interpretation. Subsection (3)?

HEYDON J: “A reference in this Act”?

MR GAGELER: “A reference in this Act”, yes, I am sorry, your Honour. I did not think I was going to be hitting controversial territory at this stage, your Honour. Section 11 states the general rule that...

Constitutionality of Voter Registration Scheme

This morning the matter of Rowe v Electoral Commissioner was before the High Court for directions. This case was recently lodged challenging the constitutionality of certain laws regulating the registration of voters in Australia. The plaintiffs argue that the exceptionally short period of time between when an election is called and when the registration for voting closes, unconstitutionally prevented (or restricted) up to 100,000 Australians from being able to register to vote in the coming Federal election.

The transcript is not up yet but according to the Sydney Morning Herald, Justice Hayne referred the matter to the Full court for hearing next week. I assume there will have to be a ruling on it prior to the election (though, as the Court has done with similarly pressing issues, they will likely reserve the reasons for ruling until a later date).

Minister for Immigration and Citizenship v SZMDS

Minister for Immigration and Citizenship v SZMDS [2010] HCA 16

Summary

Majority: Crennan and Bell JJ (Heydon J agreeing).

The Commonwealth appealed a decision of the Federal Court which held that irrationality or illogicality in a reasoning process was a jurisdictional error.

Held – The Commonwealth's appeal was allowed; decision of Federal Court set aside. The decision was not irrational or illogical.

Crennan and Bell JJ – The decision was not sufficiently irrational or illogical to constitute a jurisdictional error. Irrationality or illogicality will amount to a jurisdictional error in relation to a subjective-precondition if it leads to the point of satisfaction that is required. Reasoning will only be sufficiently irrational or illogical if no logical or rational person could have come to the same view.
Heydon J – the decision was not illogical or irrational; consequently, there was no need to consider whether such flawed reasoning might amount to a jurisdictional error
Gummow ACJ and Keifel J – the decision making process was illogical. That illogicality constituted a jurisdictional error.

Outline

The respondent was a Pakistani national who, after entering Australia on a visitor visa, soon applied for a protection visa. He sought protection on the basis that he would be persecuted if he returned to Pakistan because of, as he put it, his ‘belief in and practice of homosexuality’.

After his application was rejected by the ministerial delegate the respondent sought merits review in the Refugee Review Tribunal (‘RRT’). The RRT also concluded that the respondent was not a homosexual and consequently was not entitled to protection. He sought judicial review of the RRT’s decision in the Federal Magistrates Court; that appeal was dismissed. However, a further appeal to the Federal Court was allowed. Moore J held that the RRT had fallen into jurisdictional error by forming its conclusion on the respondent’s sexuality through an illogical process of reasoning.

The Minister appealed to the High Court, arguing two points, which the Solicitor General called the issue of fact and the broader issue of principle. The Minister first argued that the RRT had not in fact relied on illogical or irrational reasoning. However, the more important argument was that illogicality or irrationality in a reasoning process does not, of itself, amount to a jurisdictional error. There was a considerable line of authority from the Federal Court, which indicated that illogicality or irrationality in reasoning processes did indeed constitute a jurisdictional error.

Crennan and Bell JJ, who Heydon J agreed with, found that the RRT’s decision was not sufficiently illogical or irrational to create a jurisdictional error. Their Honours held that where a power is conditioned on a decision maker’s ‘satisfaction’, illogicality or irrationality in the decision maker’s reasoning process will only constitute a jurisdictional error if ‘no rational or logical decision maker could arrive’ at it from the same evidence. Gummow ACJ and Keiefel J dissented, finding both that the decision making process was illogical, and that the illogicality amounted to jurisdictional error.

Statutory Framework and Jurisdiction

The statutory framework of the Migration Act 1958 (Cth) will be well known to most practitioners. Section 36(2)(a) requires that for a person to be eligible for a protection visa they must be owed protection obligations by Australia under the Refugees Convention. Section 65 then requires the grant of a visa if the Minister is ‘satisfied’ that this criterion, amongst others, is satisfied. It was the RRT’s reasoning in reaching this satisfaction that was challenged as illogical or irrational. Due to the effect of the privative clause under s 474 of the Migration Act, which prevents most avenues of judicial review, the proceedings were brought under the High Court’s s 75(v) jurisdiction under the Constitution.

Alleged Irrationality / Illogicality

The respondent gave evidence through a translator before both the Minister’s delegate and the RRT. His uncorroborated evidence was that he had a wife and four children back in Pakistan. He claimed to have commenced a complicated three-way relationship with two other men while working abroad in the UAE. During this relationship he travelled both back to Pakistan a number of times and to the UK. After returning from the UK there was a violent breakdown between two of the three men in the relationship, which forced the respondent to go into hiding in the UAE. Once he had obtained a travel visa to Australia he made another visit to Pakistan for three weeks before travelling to Australia and making a claim for protection.

The RRT relied on two aspects of the respondent’s claim in concluding that he was not homosexual, and consequently not entitled to protection. The first was that he chose to visit Pakistan after obtaining a visitor visa for Australia. The second was the failure to make a claim for protection whilst in the UK. The respondent claimed that neither of these two factors could rationally support the inference that he was not a homosexual. He had explained both decisions in his evidence. First, he did not make a claim while in the UK, because at that point ‘he was in a good relationship’ and ‘at the time did not have any problems’. Further, he explained that he had returned to Pakistan to make a final visit to see his children, in the knowledge that he would not be returning.

Majority

Crennan and Bell JJ, with whom Heydon J agreed, determined that the reliance on these factors did not cause the conclusion to be irrational or illogical. On this basis Heydon J declined to consider whether illogicality or irrationality were jurisdictional errors as a matter of law.

Crennan and Bell JJ considered the competing submissions at greater length. Their Honours accepted that the requirement for a decision-maker to be subjectively ‘satisfied’ was a jurisdictional fact, and consequently was open to review. They acknowledged the range of long established requirements that any subjective pre-condition must satisfy. Specifically, a decision-maker will not be sufficiently satisfied where their decision is ‘clearly unjust’, ‘arbitrary’, ‘capricious’, or ‘Wednesbury unreasonable’. Further, they accepted that irrationality or illogicality will only constitute a jurisdictional error if it occurs at the point of satisfaction.

However, their Honours also noted the uncertainty of determining when reasoning is irrational or illogical. They noted that these categorisations might simply reflect a reviewing court’s view that it would have reached an alternative decision. Their Honours concluded that irrationality or illogicality would not constitute jurisdictional error unless the decision could not be reached by any rational or logical decision maker. This was expressed in a number of alternative formulations, including:

• where only one conclusion is open on the evidence and that conclusion is not reached;
• the decision that the decision-maker came to was simply not open;
• there is no logical connection between the evidence and the inferences.

Regarding the RRT’s original decision, their Honours held that a rational or logical decision maker could have come to the decision reached. They held that the Federal Court’s conclusion that the respondent’s version of events was plausible did not make the RRT’s decision sufficiently unreasonable to constitute a jurisdictional error.

Minority

Gummow ACJ and Kiefel J, writing a joint dissenting judgment, held that the reasoning process that led to the RRT’s lack of satisfaction was illogical, and that this illogicality constituted a jurisdictional error. They held that the reasons relied on by the RRT were irrational because they assumed that the respondent would be discovered and persecuted simply by returning to his home country. As his homosexuality was unknown back in Pakistan there was no basis to believe it would be discovered on a short trip, and thus it did not provide any basis to disbelieve his claims.

Regarding the concept of irrationality or illogicality in law, the logic of their Honours’ decision is difficult to follow. They were at pains to emphasise that their approach does not infringe the separation of powers by intruding upon the merits of the RRT’s decision. Further, they stressed that their approach did not adopt the more substantive approaches to judicial review accepted in the UK and Canada.

Their Honours emphasised that the requirement that the subjective state of satisfaction required by s 65 be reached rationally and logically does not traverse into merits review. This is because rationality in reaching the state of satisfaction is only required where that state is a jurisdictional fact. However, there was no explanation of when a state of subjective satisfaction will be a jurisdictional fact, or more broadly, how the distinction between jurisdictional and non-jurisdictional fact in this context is to be drawn.

Their Honours went on to observe that although previous cases of S20/2002 and SGLB, held that irrational or illogical decisions may constitute jurisdictional error, in those cases the instant errors were not held to be jurisdictional. This, it was said reinforces the idea that intervention for irrationality should not be granted lightly. The approach of Gummow ACJ and Kiefel J appears to accept that a level of irrationality lower than the Wednesbury standard adopted by Crennan and Bell JJ, will suffice to make an error jurisdictional. However, exactly where that standard lies is also less clear.

Commentary

The problem with the approach of Gummow ACJ and Kiefel J is that it leaves too many questions unanswered. Most pertinently when will a subjective pre-condition to power be a jurisdictional fact, and when will it be non-jurisdictional? Moreover, what is meant by the notion of irrationality or illogicality? Instinctively one suspects that such reasoning flaws must occur along a continuum. In a case like the present the real issue is the extent to which the respondent’s travel behaviour and failure to claim asylum were relevant in disproving his claim of being homosexual. The answer, to my mind, is that this behaviour is clearly relevant, but at the same time can only provide very slight probative value. In fact, I would go so far as to say that no reasonably judicious person could use that evidence as the basis to conclude that the respondent was lying about his history: both the RRT and the majority of the High Court clearly do not agree.

However, when the issue is framed as one of rationality or logic, what is really being said is that the RRT members drew inferences from the evidence, which it could not support. This is because there were a myriad of reasonable alternative explanations that were offered by the respondent and ignored by the Tribunal. In such a case the issue of logic or rationality is not one of discrete alternatives; it is a matter of degree. Crennan and Bell JJ’s decision identifies this problem, and as a result effectively retreats to a Wednesbury standard. While Gummow ACJ and Kiefel J identify that courts should not intervene ‘lightly’ because of irrationality, they do not explain what the threshold level of rationality should be. Consequently, their hesitance to intervene begins to look more like a discretion than any rule-based principle.

The regrettable outcome of using the Wednesbury standard is that it permits results that are patently unfair, such as the present one. This is because it permits a decision-maker to weigh evidence and draw inferences in any way they see fit, provided that their conclusion is not so irrational that no rational person could have reached it. This obviously provides plentiful room for woefully sub-optimal decision-making. In the case of executive tribunals, deciding matters that are highly political, Heydon J’s recent comments about specialist courts might be apt to describe the way some executive tribunals interpret and weigh evidence.

However, at the same time if any substance is to be maintained to the concept of jurisdictional error as a tool to ensure that tribunals stay within the decision-making powers granted to them by parliament, then descent beyond a Wednesbury reasonableness standard is difficult to justify.

Political Correctness in the UKSC

Don Mathias (Criminal Law Blog) spotted an interesting quote from Lord Rodger of the UK Supreme Court in HJ (Iran) v Secretary of State for the Home Department [2010] UKSC 31. It is like a paradox of political correctness:

[J]ust as male heterosexuals are free to enjoy themselves playing rugby, drinking beer and talking about girls with their mates, so male homosexuals are to be free to enjoy themselves going to Kylie concerts, drinking exotically coloured cocktails and talking about boys with their straight female mates.

In fairness, his Lordship does preface it by explaining that these are "trivial stereotypical examples from British society" and follows on with "This is not to ... say that an individual is defined by his sexuality."

Where’s the Catchwords Text?

Since May of this year, the High Court has not been providing any catchword text for their judgments (see eg). At first I thought it was an administrative error on Austlii’s part but Michael Pelly from the Australian today explained that the High Court has made an administrative decision not to provide catchwords. The reason given for this, Pelly says, is that they “were not thought to be useful”.

Interestingly, the Court still provides catchwords for matters when they have been given special leave to appeal but do not provide catchwords for the judgment when the reasons are published. Some case alert sites have been using these leave catchwords – at least as a structure – for the catchwords when the case is handed down. The problem with this is that the leave catchwords relate to the way the case was argued and this often differs greatly from what the Court ultimately muses upon in their reasons.

In our judgement alerts, we provide a more fluid description of a case then catchwords allow. But I for one think that catchwords are worthwhile for people to get a gist of the case if they just stumble across it on Austlii and are not lucky enough to subscribe to this blog. Particularly given that catchwords are generally written by a judge’s associate and it really cannot cut into the Court’s time too greatly to continue the practice.

Of course, catchwords will appear in reported versions of the cases but those catchwords are created by the publisher of the report and aren’t available as quickly after the decision is handed down. Also they are not free like the Austlii version, so it’s a small step backwards in the Free Access to Law Movement. I think it is unlikely that the CLRs will allow Austlii to update their case with the CLR catchwords when they are published.

Hogan v Australian Crime Commission

Hogan v Australian Crime Commission [2010] HCA 21

Summary

Majority: Unanimous (French CJ, Gummow, Hayne, Heydon and Kiefel JJ)

Decision: Appeal Dismissed

An application to set aside a suppression order made under s 50 of the Federal Court Act was resisted by the appellant on the ground that the documents contained information that was ‘inherently confidential’ to the appellant’s finances. The Court said that s 50 does not require a balancing exercise of convenience, reasonableness or public interest. An order can only be made if it is ‘necessary’ to prevent the dangers set out in s 50. If it is necessary, then an order is mandatory rather than discretionary. The documents do not fit into any established category of confidentiality. The suppression orders were set aside as they are not ‘necessary’ to ‘prevent prejudice to the administration of justice’.

The appellant was Australian personality Paul Hogan. In this appeal he was resisting an application by Nationwide News and Fairfax (“the Media”) to lift suppression orders regarding documents relating to his finances which he claimed to be confidential.

Background of Proceedings

This matter had a complex procedural history, the vast majority of which I have omitted or simplified in the discussion below (see [1]-[28]).

In the course of an Australia wide investigation into a fraudulent tax scheme, the Australian Crime Commission (“ACC”) acquired documents from the appellant’s accountants relating to his finances.

The appellant sought an injunction in the Federal Court restraining the ACC from using or disseminating the documents on the ground that they were subject to legal professional privilege.

The ACC disputed the claim on the basis that the documents were created in furtherance of a fraud.

The appellant tendered evidence through an affidavit which purported to refute the claim of fraud (“the Affidavit Documents”).

On the application of the Appellant, the judge at first instance, Emmett J, made a suppression order under s 50 of the Federal Court of Australia Act 1976 (Cth) ("the Federal Court Act") with respect to the Affidavit Documents. This order was intended to be temporary, pending further argument on the suppression issue.

Following this order, the ACC abandoned its argument of fraud, conceded the privilege claim and consented to orders being made requiring return or destruction of all of the documents held by the ACC. However these orders did not dismiss the proceedings, nor did they vacate the suppression orders and the Affidavit Documents remained on the court file.

The Media applied to set aside the suppression orders with respect to the Affidavit Documents. Emmitt J vacated the suppression orders and allowed the Media to access the Affidavit Documents.

Hogan appealed to the High Court claiming that the suppression order should stand because of the ‘inherently confidential’ nature of the documents.

Section 50 provides that the Court “may” make a suppression order if it is “necessary in order to prevent prejudice to the administration of justice or the security of the Commonwealth”.

This power operates as an exception to notions of open justice which derive from the common law and which are enumerated in s 17(1) of the Federal Court Act.

Finding

The Court dismissed the appeal and allowed inspection of the Affidavit Documents.

Although s 50 uses the terminology of ‘may’, which suggests a discretion with respect to a suppression order, the Court said that it ‘may tend to distract attention from the particular terms of s 50 to describe the Federal Court as embarking upon the exercise of a "discretion"’ (at [33]). Rather, if a court regards a suppression order as necessary, then it must make the order and if it does not regard the order as necessary then it must not make it. It is not a balancing exercise (at [31]):

It is insufficient that the making or continuation of an order under s 50 appears to the Federal Court to be convenient, reasonable or sensible, or to serve some notion of the public interest, still less that, as the result of some "balancing exercise", the order appears to have one or more of those characteristics.

The Court found that there was no prejudice to the administration of justice sufficient to make a suppression order necessary in this case. It was not sufficient for the appellant to claim that the documents were ‘inherently confidential’, without showing that they fall within a settled class of confidentiality (such as commercially sensitive material). These words of the Full Court were adopted (at [38]-[39]):

It is true that, generally speaking, every person has a right to keep from the view of others, or of the world at large, documents and things which he or she regards as his or her private concern. But so to propose is no more, in my view, than to state a conclusion about the absence of a right in any other person to view such documents and things.

Therefore, given that the Affidavit Evidence had been tendered (rather than simply being in the possession of the Court) the principles of open justice are enlivened and in the absence of a suppression order under s 50, or any evidence of harm to the appellant, the Court permitted inspection of the Affidavit Documents.

Comment

Basic statutory interpretation tells us that where the word ‘may’ is used, the decision maker will usually have a discretion. This is reinforced by s 33(2A) of the Acts Interpretation Act 1901 (Cth):

Where an Act … provides that a … court … may do a particular act or thing, and the word may is used, the act or thing may be done at the discretion of the … court … .

However the Court here found that the use of the word ‘necessary’ rendered it unhelpful to describe the power to make a suppression order as a discretion.

This outcome has serious implications for identifying the nature of an appeal from such a determination. An appeal from the exercise of a discretion requires the appeal court to identify error in the approach of the judge of the kind identified in House v The King (1936) 55 CLR 499, before determining whether or not it would have come to the same conclusion.

Given that the Court in this case has said that s 33 is not in the nature of a true discretion, an error in the nature of that identified in House v The King is not necessary and the Court will set aside an order on appeal if it is considers that it is not ‘necessary’ in the sense required by s 33 (see eg statements in Hogan at [34]).

In other jurisdictions, however, the word ‘necessary’ is not utilised and so it is likely that courts will continue to conduct appeals in those jurisdictions according to House v The King. The jurisdictions that do not use the word ‘necessary’ are: SA, ACT, NT, Tasmania and WA. However, NSW and Victoria (I have left out Qld because their suppression order system appears to be within several different Acts) both use the criterion of necessity.

On another note: proponents of the so called emerging tort of invasion of privacy might be quite disappointment by the high Court’s adoption of such a conservative statement of confidentiality in Australia as that found at [38] of the reasons. The Court accepts, at least for the purposes of the ‘administration of justice’ that confidentiality is restricted to settled notions of confidentiality.