Re Ansett Transport Industries (Operations) Pty Ltd and Another v Kenneth F Wraith and Others [1983] FCA 179 (11 August 1983)

FEDERAL COURT OF AUSTRALIA

Re: ANSETT TRANSPORT INDUSTRIES (OPERATIONS) PTY. LTD. AND ANOTHER
And: KENNETH F. WRAITH AND OTHERS
No. VG131 of 1983
Administrative Law

COURT

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION
Woodward J.

CATCHWORDS

ADMINISTRATIVE LAW - Administrative Decisions (Judicial Review) Act 1977 - request for further and better particulars of reasons for decision - form of request - sufficiency of response - request in proper form but given and received under mistaken belief as to relevant legislation.

Administrative Decisions (Judicial Review) Act 1977 s. 13

Independent Air Fares Committee Act 1981 ss.17 and 24(1)

HEARING

MELBOURNE
11:8:1983

ORDER

Subject to the provisions of s.13A of the Administrative Decisions (Judicial Review) Act 1977, the respondents furnish to the applicants within ten days an additional statement containing further and better particulars of

(a) findings on material questions of fact,

(b) the evidence or other material on which those
findings were based, and

(c) the reasons,

for the decision of 6 July 1983 not to revoke approval of East West Airlines (Operations) Ltd.'s discount air fare between Sydney and Brisbane via intermediate ports.

DECISION

This is an application, pursuant to s. 13 of the Administrative Decisions (Judicial Review) Act 1977 ('the Judicial Review Act'), for declarations and an order that the respondents, members of the Independent Air Fares Committee ('IAFC'), should give a better statement of their reasons for deciding to reject a recent request by the applicants ('Ansett'). That request was, in effect, for the IAFC to revoke its approval of discount air fares to be charged by East West Airlines (Operations) Ltd. ('East West') for services between Sydney and Brisbane via intermediate ports.

It is convenient first to consider the relevant parts of the legislation under which the IAFC operates. This is the Independent Air Fares Committee Act 1981 ('the IAFC Act'). The scheme of the Act provides that the Minister may refuse use of aerodromes and other air route facilities to any passenger operator which charges fares that have not been approved under the Act.

In this case we are concerned with discount air fares. Section 17 of the Act provides

"17.(1) A passenger operator may, in accordance with sub-section (2), request the Committee to approve a discount air fare that the passenger operator proposes to charge in respect of travel over any route.

(2) A request under sub-section (1) in relation to a proposed discount air fare in respect of travel over a route shall be made by notice in writing given to the Chairman setting out -

(a) whichever of the following amounts is applicable:
(i) in a case to which sub-paragraph (ii) does not apply - the amount (expressed as a percentage of the economy air fares charged by the passenger operator over that route) of the proposed discount air fare; or

(ii) in the case of a request by a passenger operator, other than Ansett or the Commission, in respect of travel over a trunk route over which both Ansett and the Commission provide air services - the amount (expressed as a percentage of the economy air fares that are, for the purposes of sub-section 26(1), approved air fares in relation to Ansett and the Commission in relation to that route) of the proposed discount air fare; and

(b) the conditions (if any) under which the proposed discount air fare is to be available.

(3) Where a passenger operator requests the Committee to approve a discount air fare, the Committee shall, before the expiration of 7 days after the Committee obtains such information as it considers necessary to be obtained from the passenger operator who made the request or from any other passenger operator in order to give its decision on the request, give its decision on the request.

(4) If the Committee is satisfied that -

(a) the introduction of that proposed discount air fare is likely to improve the profitability of the operations of that passenger operator in relation to the provision of air services;

(b) the introduction of that proposed discount air fare is unlikely to result in economy air fares in respect of air services provided by any trunk route operator over trunk routes being increased; and

(c) the conditions (if any) under which that proposed discount air fare is to be available are reasonable and will be applied without discrimination between persons or classes of persons who can comply with the conditions,

the Committee shall approve the proposed discount air fare but, if the Committee is not so satisfied, the Committee shall not approve the proposed discount air fare.

(5) Where -

(a) the Committee has approved, in relation to a passenger operator, a discount air fare in accordance with this section; and

(b) any passenger operator gives notice in writing to the Chairman requesting the Committee to conduct a review of the availability of that discount air fare or the Committee is satisfied that it is desirable to conduct a review of the availability of that discount air fare,

the Committee shall conduct a review of the availability of that discount air fare and shall complete the review before the expiration of 14 days after the Committee obtains such information as it considers necessary to be obtained in order to complete the review.

(6) Where -

(a) the Committee conducts a review of the availability of a discount air fare that was, in relation to a passenger operator, approved by the Committee in accordance with this section; and

(b) the Committee -

(i) is satisfied that, if the Committee revoked the approval of that discount air fare, the profitability of the operations of that passenger operator in relation to the provision of air services would not be adversely affected;

(ii) is not satisfied that the continued availability of that discount air fare is unlikely to result in any economy air fares in respect of air services provided by a trunk route operator over trunk routes being increased; or

(iii) is not satisfied that the conditions (if any) under which that discount air fare is available are reasonable or are being applied without discrimination,

the Committee shall, by notice in writing given by the Chairman to that passenger operator, revoke the approval of that discount air fare and, where such a notice is given, the Committee shall be deemed not to have approved that discount air fare.

(7) In conducting a review of a discount air fare in accordance with this section, the Committee shall have regard to the fact that a discount air fare approved by the Committee in relation to a passenger operator in respect of travel over a route may be charged, in accordance with this Act, by any other passenger operator in respect of travel over that route."

It will be seen from this section that a passenger operator in Ansett's position in the present case is given the right (by sub-s. 5) to require the IAFC to review a decision approving discount fares such as those being charged by East West on the Sydney-Brisbane route. The IAFC has the responsibility to obtain the information it considers necessary for a proper review and must then, within 14 days, complete the review. This must mean that it is required to complete its deliberations and formally make its decision within 14 days. The requirements for publication of that decision are to be found in s. 24 of the IAFC Act (below).

Section 19 of the IAFC Act, dealing with parties to proceedings, provides that, in a case such as that under consideration, operators in the respective positions of East West and Ansett shall be parties to the proceedings (s. 19(7)) and shall be entitled to present evidence and make submissions (s. 19(10)).

Since the responsibility for collecting all necessary information remains with the IAFC (s. 17(5)), it would be incorrect to speak of the parties bearing any onus of proof in such reviews. However, in the sense that a party seeking an affirmative finding will wish to ensure that there is material before a tribunal which will enable it to reach that finding, it can be said that, under s. 17(6)(b), Ansett would wish to establish that the revocation of the discount fares would not adversely affect the overall profitability of East West's passenger operations. Conversely, East West would wish to establish, first, that the continuation of the discount fares would be unlikely to result in increased economy fare charges by the Australian National Airlines Commission ('TAA') and Ansett on trunk routes, and, secondly, that the conditions attached to its discount fares were reasonable and were being applied without discrimination.

These were the statutory issues the IAFC was required to consider in its review.

The other provision of the IAFC Act directly relevant for present purposes is s. 24(1). This reads as follows:

"24.(1) Where the Committee -

(a) makes a determination in relation to a passenger operator at the conclusion of a cost allocation review;

(b) makes a determination or an interim determination of the economy air fares that may be charged by a passenger operator; or

(c) approves, refuses to approve, or revokes the approval of, in accordance with section 17, a discount air fare that a passenger operator proposes to charge,

the Chairman shall -

(d) before the expiration of 7 days after the making of that determination or decision, give notice in writing to the passenger operator setting out the terms of the determination or decision accompanied by a statement setting out any findings of facts made by the Committee, referring to the evidence or other material (other than any finding, evidence or material the publication or disclosure of which would, in the opinion of the Committee, reveal a trade secret of another passenger operator) on which those findings were based, and giving reasons for the making of the determination or decision; and

(e) cause to be published in the Gazette a notice setting out the terms of the determination or decision and any findings of facts made by the Committee, referring to the evidence or other material (other than any finding, evidence or material the publication or disclosure of which would, in the opinion of the Committee, reveal a trade secret of any passenger operator) on which those findings were based and setting out the reasons for the making of the determination or decision."

Pursuant to s. 17 of the Act, East West sought, and obtained from the IAFC on 19 May 1983, approval of discount fares to be charged on flights between Sydney and Brisbane by way of Newcastle and Coolangatta. Ansett was not a party to those proceedings. When it heard that approval had been granted, Ansett applied, on 1 June 1983, for a review of the availability of the discount fares, pursuant to s. 17(5) of the IAFC Act.

On 21 June 1983 the IAFC requested written submissions from Ansett, which were supplied on 27 June. Hearings were conducted on that same day and further submissions in writing were received on 30 June.

On 6 July the IAFC telexed its determination confirming approval of the discount fares and this led to an exchange of telex messages all of which are relevant for present purposes. The exchange went as follows (omitting formal parts):

6 July IAFC to Ansett

I refer to the review under section 17(5) of the East-West Airlines $130 excursion fare Sydney/Brisbane via ports which was approved by the Committee on 19 May 1983 for the period 20 May to 19 July 1983 inclusive.

I wish to advise that the Committee has completed the review of the above discount fare and on the basis of the information provided and evidence received has decided to confirm the approval previously granted. The Committee in reaching this decision did not consider that the period of availability of this fare namely to 19 July 1983 should be revoked on any of the grounds detailed in section 17(6)(b) of the Act.

The Committee noted evidence from the three airlines concerning the diversion of passengers from TAA and Ansett to East-West Airlines. The Committee was satisfied in this instance that trunk economy air fares would be unlikely to increase as a result of the operation of this fare to 19 July 1983. However it regards the satisfaction of sections 17(4)(b) and (c) as a matter of increasing concern in the assessment of applications for discount fares with these conditions on a continuing basis. It should be noted that the non-revocation of this discount fare should not be interpreted as meaning that the Committee will necessarily approve an application to extend the $130 Sydney/Brisbane via ports fare beyond 19 July 1983.

7 July Ansett to IAFC

We acknowledge your (an obvious error) receipt of your telex of 6th July 1983.

We based our argument that the fare should be reviewed on all three grounds set out in Section 17(6)(b) of the IAFC Act.

The telex of 6th July indicates the Committee's views on only one of the grounds, that contained in Section 17(6)(b)(ii) although observations are set out as to how that ground and the ground in Section 17(6)(b)(iii) may operate in the future. Having regard to Section 24 of the IAFC Act, we request that you advise the Committee's views with regard to the grounds for review set out in Section 17(6)(b)(i) and (iii) in relation to our request for a review of the specific fare in relation to which a review was requested.

12 July IAFC to Ansett

I refer to your telex of 7 July 1983 requesting further advice relating to the Committee's review of $130 East-West Airlines Syd/Bne via ports excursion fare.

The Committee in respect of s. 17(6)(b)(i) examined the estimates of additional net revenue and additional costs incurred as a result of introducing this fare for the time specified, and was not satisfied that if it revoked the approval the profitability would not be adversely affected.

In regard to s. 17(6)(b)(iii) this was considered, and the Committee was satisfied in the context that the conditions relating to this discount fare were reasonable and were applied without discrimination.

The Committee noted that these findings were taken following advice received as to the matters covered by s. 17(4) and s. 17(6).

14 July Ansett to IAFC

We refer to your telex of 12th July. We are not satisfied with the reasons supplied for the review of the East West Discount Fare and would ask you to expand on those reasons and advise us of all the relevant facts and other evidence that in the Committee's opinion are not of a confidential nature. Full disclosure is in our view required including a statement setting out any material findings of fact made by the Committee, referring to the evidence or other material on which those findings were based and giving the reasons for the decision. (The word 'material' in this last sentence appeared to have been added, as an afterthought, to the first draft of the telex.)

We repeat our advice in our telex of 24th June that we consider important questions of principle were involved in the Review and that the continued approval of the discount air fare is of great significance to ATI. We urge you to provide us with reasons/further reasons with all possible haste.

21 July IAFC to Ansett

I refer to your telex of 14 July 1983.

It is the view of the Committee that it has fulfilled the requirements of section 24(1) of the IAFC Act in relation to the review of this discount fare.

Notwithstanding that view, the Committee advises that in reaching a decision it had regard to the evidence and submissions both written and oral presented by Ansett, East-West and TAA.

On the basis of that material, the Committee concluded that the evidence did not justify a revocation of the approval under any of the grounds set out in section 17(6)(b) of the Act.

The Committee has conducted the review, reached a decision and notified its decision in the prescribed manner. Accordingly, we see little point in engaging in protracted correspondence on this subject.

It is clear from the telex of 7 July that when Ansett first sought further details of the findings of the IAFC, and its reasons for those findings, it did so pursuant to s. 24 of the IAFC Act. Although there was no evidence before me of the state of mind of the framers of the various telexes - other than what can be deduced from the telexes themselves - I think it is probable that they were all sent and received on the understanding that this was the relevant statutory provision. Counsel for the IAFC offered to call evidence that this was the case so far as their clients were concerned.

The only hint to the contrary is contained in the Ansett telex of 14 July, at the point where the adjective 'material' is inserted before the word 'findings' as an apparent afterthought on the part of the draftsman. That word is used as an adjective in s. 13(1) of the Judicial Review Act, but not in s. 24(1) of the IAFC Act. However the phrase used in the telex - "material findings of fact" - differs from the phrase used in the Judicial Review Act - "findings on material questions of fact". And if the Judicial Review Act was in the mind of the draftsman of the telex, it is surprising that there was no reference to it, and no use of the other language of that Act such as "person aggrieved" or "request . . . . to furnish a statement in writing".

I think it is most likely that both the parties to these exchanges thought that s. 24(1) of the IAFC Act applied to the situation. Ansett thought that the sub-section entitled it to certain findings, statements as to the material on which those findings were based and reasons for the decision which had been reached. The IAFC did not dispute Ansett's entitlement, but believed that it had in fact complied with the section.

If Ansett realized that in fact it had no entitlement under the IAFC Act, but full entitlement under the Judicial Review Act, it behaved very foolishly in framing its communications as it did. I prefer to think that both parties were labouring under a misapprehension as to the relevant law until very shortly before the application in this matter was issued on 22 July 1983.

However this may be, there can be no doubt that s. 24(1) of the IAFC Act did not apply in these circumstances and s. 13(1) of the Judicial Review Act did. So much was conceded in argument. Section 24(1) does not apply, first, because para (c) limits its operation to cases where an existing discount air fare is revoked, thus excluding by necessary inference cases in which such revocation is refused. Secondly, it only applies in favour of the passenger operator charging the discount fare (see para (d)). Other interested parties have to be content with what they find in the Government Gazette (see para (e)). Accordingly, I say no more about the requirements of the IAFC Act.

Section 13(1) of the Judicial Review Act is in the following terms:

"13.(1) Where a person makes a decision to which this section applies, any person who is entitled to make an application to the Court under section 5 in relation to the decision may, by notice in writing given to the person who made the decision, request him to furnish a statement in writing setting out the findings on material questions of fact, referring to the evidence or other material on which those findings were based and giving the reasons for the decision."

Counsel for the IAFC conceded that the Judicial Review Act applied to decisions such as that in the present case and that, if a request had been made under s. 13(1) of that Act, the IAFC would have had to comply with it. They did not seek to argue that the telexes sent by the IAFC to Ansett constituted an adequate compliance with the requirements of s. 13(1). In this they were clearly correct. Although those telexes, when read together, adequately stated the formal findings of the IAFC, they do not appear to have stated all the findings on material questions of fact, or to have identified adequately the material on which those findings were based, and they contained little if anything which could fairly be described as reasons for the decision.

The passages from judgments which are conveniently brought together in Re Palmer and Minister for the Capital Territory 1978 1 ALD 183 at 193-4, serve to confirm my view that s. 13(1) of the Judicial Review Act requires the decision-maker to explain his decision in a way which will enable a person aggrieved to say, in effect, "Even though I may not agree with it, I now understand why the decision went against me. I am now in a position to decide whether that decision has involved an unwarranted finding of fact, or an error of law, which is worth challenging".

This requires that the decision-maker should set out his understanding of the relevant law, any findings of fact on which his conclusions depend (especially if those facts have been in dispute), and the reasoning processes which led him to those conclusions. He should do so in clear and unambiguous language, not in vague generalities or the formal language of legislation. The appropriate length of the statement covering such matters will depend upon considerations such as the nature and importance of the decision, its complexity and the time available to formulate the statement. Often those factors may suggest a brief statement of one or two pages only.

The arguments of counsel have left only one finding to be made by this Court - whether a notice was given by Ansett to the IAFC in accordance with s. 13(1) of the Judicial Review Act. I have reached the conclusion that such a notice was given.

In arriving at that conclusion, I begin with the general policy of the Judicial Review Act, which clearly intends that persons aggrieved by administrative decisions which adversely affect them should have full opportunity to show, if they can, that such decisions have been improperly reached. They can only do this if they know how the decisions were in fact reached.

The right to obtain information about decisions is given by s. 13(1) of the Act. It is to be noted that no form of request is prescribed. Nor does the section require that the request be stated as being made pursuant to the Judicial Review Act. Persons making decisions to which that Act applies must be taken to know of their obligation to supply reasons when requested to do so. They should not need to be referred to the relevant legislation. Nor should a person with rights under the Judicial Review Act be denied those rights merely because he does not know of them, or only knows of them vaguely, and so makes a request in some informal letter or other communication which does not follow the wording of s. 13(1).

Providing the request is within time (28 days after receipt of the determination in the present case, see s. 13(5)), is in writing, comes from a person aggrieved by the decision, and amounts to a request for reasons for the decision reached, I believe it ought to be complied with. It is probably sufficient for the decision-maker to comply with the actual terms of the request (or so much of it as falls within s. 13(1)) and not to supply other information which might have been sought under the section but was not. That point does not arise in the present case because Ansett sought, in its telex of 14 July, "all the relevant facts and other evidence that in the Committee's opinion are not of a confidential nature". Full disclosure was said to require "a statement setting out any material findings of fact made by the Committee, referring to the evidence or other material on which those findings were based and giving the reasons for the decision".

It will be seen that these words are very similar to those in s. 13(1) of the Judicial Review Act. They would quite clearly be adequate to require a response under that section were it not for the fact that they are equally close to the wording of s. 24(1) of the IAFC Act, and that Act had been specifically (though, as I have said earlier, wrongly) invoked in an earlier telex in the series. But since the request of 14 July was, on its face, clearly sufficient to satisfy s. 13(1) of the Judicial Review Act, I do not believe it was vitiated either by the fact that Ansett probably had other legislation in mind or because the IAFC was not aware of its legal obligations under relevant legislation and was suffering from the same misunderstanding as Ansett, due in part to the form of Ansett's earlier telex of 7 July. These considerations are relevant to the exercise of the Court's discretion to make an order, and to the question of costs, but they do not, in my opinion, vitiate the request.

I believe that the Court does have a discretion in a case such as this; the words "the Court may order" in s. 13(7) of the Judicial Review Act are permissive rather than mandatory. I have seriously considered exercising that discretion against Ansett for two reasons - first, because it may well have misled the IAFC as to its legal responsibilities; and, secondly, because the decision which gave rise to the request has run its course.

However I am assured by Counsel for Ansett that the decision is still of importance as the first made under s. 17(5) of the IAFC Act and as one of a series, and it has been replaced by another decision in very similar terms covering the same subject-matter. And I think that, when in doubt under this section, it can seldom be wrong to opt for disclosure.

As to the form of order to be made, Counsel for Ansett, at the close of argument, sought only an order that the IAFC furnish an additional statement "containing further and better particulars with respect to the findings, evidence or other material or reasons relevant to the decision". Counsel instanced some of the issues on which they would expect to receive useful findings of fact and reasons for decision, but they did not attempt to formulate any more detailed order than was sought, in the terms I have quoted, by the original application.

Among the matters instanced by Counsel on which, as at present advised, I would have thought they were entitled to information (if such matters in fact played a part in the decision) were:-

(a) What was the approach of the IAFC to the determination of profitability of an operator - what margins of profitability are relevant and what can be discounted as trivial - what is the relevance of excess capacity to considerations of profitability?

(b) What did the IAFC find to be the expected passenger and revenue loss (if any) to trunk operators as a result of the discount fare? What was the significance of such a loss?

(c) What did the IAFC find to be the expected numbers of persons using the discount air fare who would not otherwise have flown the route?

(d) What does the IAFC regard as reasonable conditions within the meaning of s. 17(6)(iii) of the IAFC Act?

(e) What was the relevance to the IAFC decision of the short period for which the discount fare was sought?

(f) What weight, if any, did the IAFC accord to cost figures, relating to Air New South Wales, which were produced by Ansett?

Although I have drawn attention to these particular issues, and s. 13(7) of the Judicial Review Act contemplates a more specific order as to the matters to be covered by way of 'further and better particulars', I do not believe such an order would be appropriate in the present case. This is so for three reasons; first, because the statement in fact made in response to the request of 14 July was so laconic that it is impossible to point to specific matters requiring elaboration; secondly, because only part of the material and submissions put before the IAFC were before me; and thirdly, because difficult questions of confidentiality, on which I have no information, may arise under s. 13A of the Judicial Review Act.

For these reasons I think the appropriate order of the Court is that, subject to the provisions of s. 13A of the Judicial Review Act, the IAFC should furnish to Ansett within ten days an additional statement containing further and better particulars of

(a) findings on material questions of fact,

(b) the evidence or other material on which those
findings were based, and

(c) the reasons,

for the decision of 6 July 1983 not to revoke approval of East West's discount air fare between Sydney and Brisbane via intermediate ports.

I intend to make no order as to costs. Although Ansett has been successful, it is only on a fine balance that I have exercised my discretion in its favour. Much of the trouble that has arisen in this matter has been caused by the inapt and misleading terms used by Ansett in first seeking the information it required; and Ansett is a major public company with ready access to appropriate advice.