POWER, THE DUALITY OF FUNCTIONS AND … · ... on the former Taxation , of Review, ... as are invested with federal jurisdiction pursuant to that Chapter.13 ... appeals to the Federal

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,.,__.rJL .... POWER, THE DUALITY OF FUNCTIONS AND THE ADMINISTRATIVE APPEALS TRIBUNAL

AllanNHalt

r~,,;"''""'~'nve Appeals Tribunal (the AAT), which was established by the Appeals Tribunal Act 1975 (Cth) (the AAT Act), has now been

for more than 16 years. From very modest beginnings (see the 25 conferred pursuant to the Schedule to the original AAT Act), the Tribunal

conferred upon it an increasingly wide range of review jurisdictions (presently of 240), encompassing major areas of governmental decision-making.1 Many

, decisions were previously unreviewable on the merits. Others were reviewable ' separate specialist tribunals operating independently of each other,2 or before

Court (and other courts exercising federal jurisdiction) in procedures by way appeal or collateral attack that were little utilised.3

AAT was obviously modelled closely, but not slavishly, on the former Taxation , of Review, the constitutional validity of which was upheld by the High Court in Commissioner of Taxation v Munro,4 a decision which was affirmed on appeal bt

Council sub nom Shell Co of Australia Ltd v Federal Commissioner of Taxation. purpose of reviewing a decision, the Tribunal is invested with all the powers

c::rr•P~'"'"" that are conferred by any relevant enactment on the primary decision-43(1)). It is empowered to conduct a hearing (s 35) and, for that purpose, has the procedural powers appropriate to curial proceedings (see ss 32, 33, 39,

40((1) and 41). In the conduct of a proceeding, the Tribunal is bound to observe

LLB. Formerly a Deputy President of the Administrative Appeals Tribunal (Cth) and Fellow, Faculty of Law,Australian National University.

a creature of statute, the AAT has jurisdiction only where it is conferred by or pursuant an "enactment"; see ss 25 and 26 AAT Act; cf Re Qantas Airways Ltd and Deputy

om1nzsim· mer of Taxation (1979) 2 ALD 291. <=Aotuq>n:::, the former Taxation Boards of Review and the former Commonwealth

Compensation Tribunal. example, the now repealed s 78 of the Superannuation Act 1922 (Cth); cf the former of the Defence Force Retirement Benefits Act 1948 (Cth), considered by the High

in Steele v Defence Forces Retirement Benefits Board (1955) 92 CLR 177; and, as to - .. u .... .,, .. attack, sees 167 of the Customs Act 1901 (Cth).

CLR 153 per Isaacs, Higgins, Gavan-Duffy, Rich and Starke JJ; Knox CJ

14 Federal Law Review Volume22

the rules of natural justice6 or, as those rules are now commonly referred to, the requirements of procedural fairness. 7 The function of the Tribunal is to review the decision on the merits and to determine, by a fresh exercise of administrative power, whether that decision is the correct or preferable one on the material before it. 8 For this purpose, it is said to "stand in the shoes" of the primary administrator.9 Decisions of the Tribunal on questions of law are reviewable on appeal to the Federal Court (s 44). The "appeal" falls within the original, not the appellate, jurisdiction of the Court.10

So far as the intention of Parliament is relevant,ll the AAT was clearly constituted as a tribunal intended to exercise administrative powers and functions pursuant to Chapter IT of the Constitution, not as a court exercising the judicial power of the Commonwealth pursuant to Chapter m.12 It is, of course, well settled that the exercise of such power is the exclusive preserve of the High Court and of such other courts as are created or as are invested with federal jurisdiction pursuant to that Chapter.13 Thus if, in any of its jurisdictions, the AA T was found to be exercising part of the judicial power of the Commonwealth, the Tribunal would, at least to that extent, be acting unconstitutionally.14

To date, no one has mounted a comprehensive challenge to the constitutionality of the AAT, and it ma~ well be that this reflects a widely held perception that the AAT is validly constituted. 5 Such attacks as have been mounted, so far without success, have been confined to essentially peripheral issues such as the constitutionality of appointing Federal Court Judges as presidential members of the AAT,16 and the validity of s 44 of the AAT Act insofar as it provides for an appeal on a question of law

6 7

8

9 10 11

12

13

14

15

16

Sees 39 AAT Act; cf Sullivan v Department of Transport (1978) 1 ALD 383 at 402-403. Fletcher v Federal Commissioner of Taxation (1988) 84 ALR 295 at 307; Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 at 365-367. Drake v Minister for Immigration and Ethnic Affairs (1979) 2 ALD 60 at 68 per Bowen C] and Deane J; at 77 per Smithers J. Minister for Immigration and Ethnic Affairs v Pochi (1980) 4 ALD 139 at 143 per Smithers J. Federal Court of Australia Act 1976 (Cth), s 19(2); cf Drake (1979) 2 ALD 60 at 61-62. R v Quinn; ex parte Consolidated Food Corporation (1977) 138 CLR 1 at 5 per Barwick C] and at 9 per Jacobs J. Re Adams and Tax Agents Board (1976) 1 ALD 251 at 253; Drake (1979) 2 ALD 60 at 64 and 67; Bogaards v McMahon (1988) 80 ALR 342 at 349. Huddart Parker & Co Pty Ltd v Moorehead (1909) 8 CLR 330; New South Wales v The Commonwealth (the Wheat case) (1915) 20 CLR 54; Waterside Workers' Federation of Australia v J W Alexander Ltd (1918) 25 CLR 24; British Imperial Oil Co Ltd v Federal Commissioner of Taxation (1925) 35 CLR 422 (the BIO case); R v Kirby; ex parte Boilermakers' Society of Australia (1957) 95 CLR 529: and see L Zines, The High Court and the Constitution (3rd ed 1992) at 147-150 and 179-184; cf PH Lane, "The Decline of the Separation of Powers Doctrine" (1981) 55 AL/6. See the BIO case (1925) 35 CLR 422; cf Re Cram; ex parte The Newcastle Wallsend Coal Co Pty Ltd (1987) 163 CLR 140. Cf Drake (1979) 2 ALD 60 at 64 per Bowen C] and Deane J: "The general functions conferred upon the Tribunal are plainly administrative in character". In Drake (1979) 2 ALD 60 it was held that there was no constitutional objection to appointing a Federal Court Judge in his "personal capacity" to the AAT (cf Hilton v Wells (1985) 157 CLR 57 at.68 and 83) and that the quasi-judicial functions discharged by the Tribunal do not lose their administrative character when performed by a Judge (at 63-65). See also Commonwealth of Australia v Jones (1987) 71 ALR 497.

Judicial Power, the Duality of Functions and the AAT 15

cases where the Tribunal's power may only be recommendatory.17 More doubts have been expressed by Gummow J as to the validity of s 44 in its

to in taxation matters on the ground (inter alia) that it may preclude the Federal Court from itself deciding disputed questions

in such cases.18 Doubts persist as to whether an administrative tribunal can usurping judicial power) make conclusive findings of fact. 19 There are also as to the limits of the Tribunal's power to form an opinion on (or to "decide") of law.

be denied that, particularly in those jurisdictions where the issues raised 'U'-L"-U'L"' such as in taxation, customs, employees' compensation and pension

matters, there are many similarities between the powers and functions of and those of a court exercising the judicial power of the Commonwealth. Not of these is that, in practical terms, the Tribunal's main function is to decide

between the Federal Government (or its agencies) and citizens with to rights, privileges and liabilities arising under laws made by Parliament, for

the Tribunal is invested with many court-like attributes. Indeed, these led one presidential member of the AAT to conclude that, in determining

arising in its employees' compensation jurisdiction, the Tribunal was, , exercising part of the judicial power of the Commonwealth.20

article will consider the constitutional status of the AAT in the light of current of judicial power and of the duality of functions doctrine. In my

opinion, the orthodox view of judicial power has been dominated by what as "the primary or private law aspect" of that power, the origins of which

found in the widely quoted dictum of Griffith CJ in Huddart Parker & Co Pty llnn,rPh'Pan 21 As a consequence, there has been inadequate recognition that, in its . or public law aspect" (exemplified by the supervisory jurisdiction of the

over the legislative and executive arms of government), judicial power · quite different characteristics. The nature of these differences will be

as will the interrelationship between the public law aspect of judicial power duality of functions doctrine.

issues that are also addressed in this article include the following:

is the availability of an alternative right of review before a Chapter ill court arp'""~ITU in order to SUStain the constitutionality of administrative revtew?

a federal administrative tribunal make conclusive findings of fact?

such a tribunal conclusively "decide" questions of law?

44 of the AAT Act 1975 (which limits appeals to the Federal Court to "questions valid?

v Minister for Immigration and Ethnic Affairs (1982) 42 ALR 209. Skypak Ltd v Federal Commissioner of Taxation (1988) 82 ALR 175 at 178. , Co (Aust) Pty Ltd v Commonwealth (1945) 69 CLR 185 at 217-219 per Williams J; cf

above n 13 at 153-169. Bank of Australia and Comcare (1989) 17 ALD 682. It may be noted, however, that

had sought to argue the question and that neither of them sought to test the opinion before the Federal Court.

8 CLR 330 at 357.


What are the differences between the judicial adjudication of the merits of public law controversies by way of statutory appeal and the administrative adjudication of those issues by way of administrative review?

JUDICIAL POWER REVISITED

Judicial power is ~ower, the roots of which lie deeply embedded in our constitutional and legal history. Inevitably, the concept has been shaped, to a considerable extent, although not exclusively, by considerations as to the essential nature and the distinguishing characteristics of the power, drawn from our inherited legal traditions.23

Judicial power is characterised by the independence of the power itself from the legislative and executive powers of government and, as a necessary prerequisite to that independence, by the independence of those members of the judiciary to whom the exercise of the power is entrusted. 24 In the federal system, the absolute independence of the judiciary is "the bulwark of the Constitution against encroachment by the legislature or the executive"25 and "a safeguard of individualliberty".26

The power is unique within our constitutional system, not only because of its independence from the other powers of government, but also because of the special incidents that attach to its exercise. Judicial power predicates "not merely a capacity for adjudication, but the authoritative character, the binding consequences and the indirectly coercive effect of adjudication by a court".27 Whilst a power of enforcement may be a traditional concomitant of judicial power,28 the absence of such power does not preclude a finding that a tribunal is nevertheless exercising judicial power.29

The strict separation of the judicial power of the Commonwealth from the legislative and executive powers has necessarily imposed limitations upon the types of functions that may validly be conferred on, or exercised by, tribunals not constituted as courts falling within Chapter III of the Constitution. Thus, functions which, by tradition or otherwise, are perceived as indelibly associated with the exercise of judicial power

22

23 24

25

26

27 28

29

See W RAnson, The Law and Custom of the Constitution (4th ed 1935) Vol II Part II at Ch XII; W S Holdsworth, A History of English Law (7th ed 1956) Vol1 at 194-264. See, for example, R v Davison (1954) 90 CLR 353; cf Quinn (1977) 138 CLR 1 at 10-11. See F W Maitland, The Constitutional History of England (1963) at 312-313; R v Trade Practices Tribunal; ex parte Tasmanian Breweries Pty Ltd (1970) 123 CLR 361 at 390 per Windeyer J; Capital TV and Appliances Pty Ltd v Falconer (1971) 125 CLR 591 at 611-612. Boilermakers' case (1957) 95 CLR 529 at 540-541; cf Liyanage v The Queen [1967] 1 AC 259 at 287-288. Davison (1954) 90 CLR 353 at 381-382 per Kitto J; cf Quinn (1977) 138 CLR 1 at 11 per Jacobs J; see also Re Tracey; ex parte Ryan (1989) 166 CLR 518 at 580 per Deane J. Tasmanian Breweries (1970) 123 CLR 361 at 390 per Windeyer J. Alexander (1918) 25 CLR 434 at 445, 451-453, 463-464 and 481; cf Harris v Caladine (1991) 65 ALJR 280 at 289 per Brennan J. Davison (1954) 90 CLR 353 at 368-369; Tasmanian Breweries (1970) 123 CLR 361 at 408, 409, 412 and 416; see also Rola Co (1945) 69 CLR 185 at 198-199.

Judicial Power, the Duality of Functions and the AA T 17

be ::onferred upon, or exercised by, either the executive arm of government3° or administrative or arbitral tribuna1.31

power, however, has been described as an "elusive concept".32 The problem in framing any definition that is at once "exclusive and exhaustive" - a task the

Court has frequently acknowledged to be impossible.33 Nevertheless, functions lie at the heart of judicial power have been clearly identified.

primary or private law aspect of exclusive judicial power foundation of the orthodox view of "judicial power" is to be found in the judgment

CJ in Huddart Parker where his Honour said: am of the opinion that the words "judicial power" as used in sec 71 of the Constitution

mean the power which every sovereign authority must of necessity have to decide controversies between its subjects, or between itself and its subjects, whether the rights relate to life, liberty or property. The exercise of this power does not begin until some 'tribunal which has power to give a binding and authoritative decision (whether subject to appeal or not) is called upon to take action.34

this statement has received wide judicial approval and has been described as the best definitions" of judicial power,35 it is perhaps better seen as no more

an accurate description of the "broad features" of that power36 or as a "convenient point"37 in the quest for understanding of this complex and multi-faceted

more comprehensive description of the content of judicial power and of its · characteristics is to be found in the judgment of Kitto J in R v Trade Tribunal; ex parte Tasmanian Breweries Pty Ltd as follows:

Thus a judicial power involves, as a general rule, a decision settling for the future, as · defined persons or classes of persons, a question as to the existence of a right or ··obligation, so that an exercise of the power creates a new charter by reference to which , that question is in future to be decided as between those persons or classes of persons. In other words, the process to be followed must generally be an inquiry concerning the law as it is and the facts as they are, followed by an application of the law as determined to the facts as determined; and the end to be reached must be an act which, so long as it 'stands, entitles and obliges the persons between whom it intervenes, to observance of the rights and obligations that the application of law to facts has shown to exist. It is right, I think, to conclude from the cases on the subject that a power which does not involve such a process and lead to such an end needs to possess some special compelling feature if its inclusion in the category of judicial power is to be justified.38

Victorian Chamber of Manufacturers v Commonwealth of Australia (1943) 67 CLR 413 at 416-417 per Latham CJ and at 422 per Starke J; cf Pochi (1980) 4 ALD 139 at 156 per Deane J. The BIO case (1925) 35 CLR 422; Silk Bros Pty Ltd v State Electricity Commission of Victoria {1943) 67 CLR 1; Re Cram (1987) 163 CLR 140 at 148. Polyukhovich v Commonwealth of Australia (1991) 172 CLR 501 at 532 per Mason CJ. See, for example, Tasmanian Breweries (1970) 123 CLR 361 at 394; Quinn (1977) 138 CLR 1 at 16; Harris v Caladine (1991) 172 CLR 84 at 107-108; Precision Data Holdings L~d v Wills (1991) 173 CLR 167 at 188-189. {1909) 8 CLR 330 at 357. Shell Co (1930) 44 CLR 530 at 542-543. Labour Relations Board of Saskatchewan v John East Ironworks Ltd [1949] AC 134 at 149. Harris v Caladine (1991) 172 CLR 84 at 135 per Toohey J. {1970) 123 CLR 361 at 374-375.


These descriptions of judicial power reflect the historical function of the courts in resolving private law disputes with respect to the rights of the individual. As such, they have distinct echoes of the Diceyan formulation of the Rule of Law, which postulated that no man can be made to suffer punishment or pay damages for any conduct not definitely forbidden by law; and that every man's legal ricfhts or liabilities are almost invariably determined by the ordinary courts of the land. 3 The function of judicial power, in this context, is to "quell the controversy" between the parties40 with respect to those legal rights and liabilities.

In his leading judgment in R v Quinn; ex parte Consolidated Food Corporation, Jacobs J noted that the historical approach to the question of whether a power is exclusively judicial is said to be ''based upon the recognition that we have inherited and were intended by our Constitution to live under a system of law and government which has traditionally protected the rights of persons by ensuring that those riyhts are determined by a judiciary independent of the parliament and the executive."4 But the "rights" referred to are the "basic rights which traditionally and therefore historically are judged by that independent judiciary which is the bulwark of freedom."42

Thus, "the making of binding declarations of right by way of adjudication of disputes about rights and obligations arising out of the operation of the law upoZU'ast events or conduct" is a "classical instance" of the exercise of judicial power. As Brennan J said in Harris v Caladine, the power to decide controversies with respect to existing rights and liabilities lies "at the heart of judicial power".44 Judicial power, in this private law sense, includes "[t]he power to adjudge guilt of, or determine punishment for, breach of the law";45 the }tower to determine actions invoking the remedies of the common law and equity; and the power to determine questions affecting the legal status of the :iitdividual.47 These are all matters affecting the "basic rights" (or what the writer refers to as the "private law rights") of the individual in our society. Such rights, as we shall see, are to be differentiated from public law rights, privileges and liabilities.

The secondary or public law aspect of exclusive judicial power One vital area of judicial power which the Huddart Parker "definition" or description fails adequately to accommodate is, I suggest, the public law aspect of judicial power

39

40 41 42 43

44

45

46 47

See Quinn (1977) 138 CLR 1 at 11 per Jacobs J; cf A V Dicey, Introduction to the Study of The Law of the Constitution (9th ed 1948}, introduction byE C S Wade at lxxvii. Fencott v Muller (1983) 152 CLR 570 at 608. (1977) 138 CLR 1 at 11. Ibid. Precision Data Holdings (1991) 173 CLR 167 at 188; Re Cram (1987} 163 CLR 140 at 148; and Jacka v Lewis (1944) 68 CLR 455 at 460. (1991) 172 CLR 84 at 107. See also Re Tracey (1989) 166 CLR 518 at 580 per Deane J; Alexander (1918) 25 CLR 434 at 464 per Isaacs and Rich JJ. Re Tracey (1989) 166 CLR 518 at 580; cf Harris v Caladine (1991) 172 CLR 84 at 147 per Gaudron J; Quinn (1977) 138 CLR 1 at 11 per Jacobs J; and see Polyukhovich (1991) 172 CLR 501 at 608-609 per Deane J, at 685 per Toohey J, and at 703-704 per Gaudron J; cf Chu Keng Lim v Minister for Immigration (1992) 176 CLR 1 at 27. Cf Munro (1926) 38 CLR 153 at 175 per Isaacs J. Quinn (1977) 138 CLR 1 at 11; Davison (1954) 90 CLR 353 at 365; Harris v Caladine (1991) 172 CLR 84 at 147; but cf Pochi (1980) 4 ALD 139 at 156 per Deane J.

. 1994 · Judicial Power, the Duality of Functions and the AAT 19

. developed through the supervisory jurisdiction of the courts. In respect of controversies over statutory rights, privileges and liabilities, the primary

· administration of which is committed by Parliament to the executive arm of government, the function of judicial power has always been of a more limited nature than its function in resolving controversies as to "basic", or private law, rights.48 Essentially, in public law controversies, the function of judicial power is one of containment - containment of the legislative and executive arms of government, and of inferior courts and tribunals, within the proper ambit of their powers. As Rich J said in the Rola Co (Aust) Pty Ltd v Federal Commissioner of Taxation:

It must be remembered also that it is not necessary, in order that power may be judicial, that it should be concerned with the ascertainment and determination of existing legal rights and liabilities as between litigants. A superior court exercises original judicial power when, in its supervisory jurisdiction, by the use of the prerogative writs of prohibition or certiorari, it keeps inferior courts or bodies within the limits of their jurisdiction or authority, or constrains them to observe the principles of natural justice.49 There are, of course, countless statutory rights, privileges and liabilities, the primary

administration of which is vested in the executive arm of government. Whilst the courts were able, by adapting the common law remedies by way of the prerogative writs and the equitable remedy of declaratory judgment, to develop a supervisory jurisdiction by which to control the substantive and procedural legality of the exercise of administrative power,50 the common law was unable to provide any remedy by which to correct administrative decisions that were simply wrong on the merits.51 The more limited nature of this secondary aspect of exclusive judicial power rests upon a recognition by the courts that the exercise of administrative powers and discretions has been committed by Parliament to the executive arm of government and that, in the absence of specific authorisation by Parliament, it is not for the courts to usurp that function.52 Thus, whilst the supervisory jurisdiction of the courts is an essential element in the totality of exclusive judicial power,53 it is of a more limited nature and rests upon a quite different historical foundation from the primary aspect of that power. It follows that Chapter III courts can only resolve public law controversies on the merits where Parliament has expressly conferred jurisdiction to do so by way of statutory appeaL 54 Such an appeal is not a common law proceeding. 55

48

49 50

51

52 53 54

55

For the sake of convenience, I have adopted the public law /private law dichotomy, although recognising that, within the common law tradition, the distinguishing line between the two may not always be entirely clear: see C Harlow, "Public and Private Law: Definition without Distinction" (1980) 43 MLR 241; cf G Samuel, "Public and Private Law: A Private Lawyer's Response" (1983) 46 MLR 558. See also the discussion of "The American 'Public Rights' Doctrine", below at 28. (1945) 69 CLR 185 at 204. In the federal context, sees 75(v) of the Constitution; s 39B of the Judiciary Act 1903 (Cth); and the Administrative Decisions Gudicial Review) Act 1977 (Cth). See Builders' Licensing Board v Sperway Constructions (Sydney) Pty Ltd (1976) 135 CLR 616 at 619; Green v Daniels (1977) 13 ALR 1 at 12; Australian Broadcasting Tribunal,v Bond (1990) 170 CLR 321 at 341 and 357. Green v Daniels (1977) 13 ALR 1 at 12; Bond (1990) 170 CLR 321 at 341 and 357. Cf Re Tracey (1989) 166 CLR 518 at 580 per Deane J. Steele (1955) 92 CLR 177 at 186; Farbenfabriken Bayer A-G v Bayer Pharma Pty Ltd (1959) 101 CLR 652 at 659. Sperway Constructions (1976) 135 CLR 616 at 619.

20 Federal Law Review Volume 22

The nature of a "matter" This analysis finds support, I suggest, in the prov1s1ons of Chapter III of the Constitution with respect to the conferral of federal jurisdiction. The conferral of original jurisdiction on a Chapter III court either directly by force of the Constitution under s 75, or pursuant to laws made by Parliament under s 76, is predicated upon the existence of a "matter". "Matter" in this context has been held to mean "the subject matter for determination in a legal proceeding".56 Conformably with the "primary or private law" aspect of judicial power, the High Court has said that a "matter" must involve "some right or privilege or protection given by law, or the prevention, redress or punishment of some act inhibited by law".57 Clearly, however, it also includes a "matter" in which the more limited secondary or public law aspect of judicial power is invoked.58 Doubtless, s 76 of the Constitution is the source of Parliament's power to enact the Administrative Decisions Q"udicial Review) Act 1977 (Cth) (the ADJR Act) under which extensive supervisory jurisdiction is conferred on the Federal Court.

For a "matter" to be appropriate to be determined by a Chapter III court, it must give rise to a justiciable issue, that is to say an issue determinable by reference to "some legal standard",59 be it some "rule of law",60 an objective matter of fact,61 or some discretionary judgment based upon an ascertainment of facts and governed by standards which are either definite or, if indefinite, are at least "not undefined".62 Thus, where the review of an administrative decision involves the determination of justiciable issues, that review function will give rise to a "matter" in respect of which jurisdiction by way of statutory ap~eal may be conferred on a Chapter III court pursuant to s 76 of the Constitution. 3 The function of the court in resolving such an appeal is analogous to its function in determining a controversy with respect to "basic" or "private law" rights. It is a function, therefore, that is appropriate to the exercise of judicial power, 64 but, as we shall see, not exclusively so.

On the other hand, if the ultimate decision in the case "may be determined not merely by the application of legal principles to ascertained facts, but by considerations of policy also, then the determination does not proceed from an exercise of judicial power".65 In addition, purely administrative discretions "governed by nothing but standards of administrative convenience and general fairness" are inappropriate to the exercise of such power.66

56 57 58 59

60 61 62 63

64 65

66

In Re Judiciary and Navigation Acts (1921) 29 CLR 257 at 265. Ibid at 266-267. See, for example, s 75(v) of the Constitution; cf s 39B of the Judiciary Act 1903 (Cth). New South Wales v Commonwealth (No 1) (1932) 46 CLR 155 at 185, cf South Australia v Commonwealth (1962) 108 CLR 130. Munro (1926) 38 CLR 153 at 212 per Starke J. Steele (1955) 92 CLR 177 at 186-187. Ibid. Steele (1955) 92 CLR 177 at 186-188; Gungor (1982) 42 ALR 209 at 211-212; Bayer Pharma (1959) 101 CLR 652 at 659; Commonwealth v Anderson (1957) 97 CLR 345; and see W A Wynes, Legislative, Executive and Judicial Powers in Australia (5th ed 1976) at 482-483. Cf Steele (1955) 92 CLR 177 at 187-188. Precision Data Holdings (1991) 66 ALJR 171 at 176; cf Bond (1990) 170 CLR 321 at 341 per MasonCJ. Steele (1955) 92 CLR 177 at 186-187; cf Avon Downs Pty Ltd v Federal Commissioner of Taxation (1949) 78 CLR 353 at 360.

1994 Judicial Power, the Duality of Functions and the AAT 21

A "matter" may include incidental non-judicial functions,67 but does not extend to the determination of "abstract questions of law without the right or duty of any body or persons being involved".68 Thus, a court exercising the judicial power of the Commonwealth cannot constitutionally give advisory opinions or exercise a ·recommendatory function that is only advisory in nature.69 However, such functions, being characterised as non-judicial, may validly be conferred upon a tribunal such as theAAT.7°

. DUALITY OF FUNCTIONS

The conceptual foundation of the non-exclusive public law aspect of judicial power exercised by the courts by way of statutory appeal is to be found within the duality of functions doctrine. This doctrine underpins both the jurisdiction of Chapter III courts in such appeals and much of the administrative review jurisdiction exercised by the AAT. It acknowledges that there are public law functions falling outside the scope of

· · exclusive judicial power which may be classified as either judicial or administrative, depending on the way in which they are to be exercised. A function of this kind will normally take its character from that of the tribunal in which it is reposed.71 The doctrine finds its origins in the judgment of Isaacs J in Munro.n It has been repeated~ affirmed by the High Court in recent times and may now be taken to be well settled. 3 A similar doctrine has long been acce~ted by the United States Supreme Court, albeit with important differences in outcome.74

Functions falling within the dualit~ doctrine lie in the borderland in which judicial and administrative functions overlap. 5 It is a borderland bounded, albeit imprecisely, on the one side by those functions which, of their nature, may be exercised only by courts exercising the judicial power of the Commonwealth and, on the other, by those functions which, of their nature, are inappropriate for such exercise. 76 It includes both the substantive function of reviewing administrative decisions on the merits and the incidental adjudicative and procedural powers necessary for the proper performance of the review function.

67 68

69

70 71

Davison (1954) 90 CLR 353 at 368. In Re Judiciary and Navigation Acts (1921) 29 CLR 257 at 266-267; cf Minister for Works for the Government of Western Australia v Civil & Civic Pty Ltd (1967) 116 CLR 274; and see Gungor (1982) 42 ALR 209 at 211-212 per Fox J. Victoria v Australian Building Construction Employees' and Builders' Labourers' Federation (No 2) (1982) 152 CLR 179 at 183 per Gibbs CJ. Sees 59 AAT Act; cf Reference under Ombudsman Act, Section 11 (1979) 2 ALD 86. R v Hegarty; ex parte Salisbury City Corporation (1981) 36 ALR 275 at 281 per Mason J; Munro (1926) 38 CLR 153 at 177 per Isaacs J. (1926) 38 CLR 153 at 174-178; cf L Zines, above n 13 at 153. Hegarty (1981) 36 ALR 275 at 281; Re Ranger Uranium Mines Pty Ltd; e; parte Federated Miscellaneous Workers' Union of Australia (1987) 163 CLR 656 at 665; Precision Data Holdings (1991) 173 CLR 167 at 189. See "The American 'Public Rights' Doctrine" below at 28. Labour Relations Board of Saskatchewan v John East Ironworks Ltd [1949] AC 134 at 149. Cf L Zines, above n 13 at 153.


Substantive review on the merits of administrative decisions We are not here concerned with those review functions of an essentially administrative kind involving the exercise of broad discretionary or recommendatory powers based on considerations of government policy or the like. 77 Such functions, as we have seen, are inappropriate for the exercise of judicial power because they do not raise a justiciable issue. Rather, we are concerned with administrative decisions involving justiciable issues which give rise to a "matter" in the relevant sense. It is to the review of such decisions that the duality doctrine is confined.

The Munro and Shell Co cases early established that the function of reviewing an administrative decision on the merits was not exclusively judicial. Both the High Court, and the Privy Council on appeal, held that it was constitutionally permissible for the Commonwealth Parliament to provide an administrative procedure for the review of a decision of the Commissioner of Taxation as an alternative, available at the option of the taxpayer, to a statutory appeal to a Chapter III court.

The Commonwealth's first attempt to create an administrative review tribunal in taxation matters - under the name "Board of Appeal" - had foundered, not because the function was incapable of being committed to an administrative body, but rather because the powers with which the Board was invested to discharge its review function were seen by the High Court as bearing the unmistakable indicia of judicial power?8

The Commonwealth's second attempt was successful. By amendments to the Income Tax Assessment Act 1922 (Cth) the former Board of Appeal became the "Taxation Board of Review"; the new Board was invested with "all the powers and functions of the Commissioner" for the purpose of carrying out its review functions; and the assessments, determinations and decisions of the Board upon review were "deemed to be assessments, determinations and decisions of the Commissioner" (see s 44(1)). In giving its decision on the review, the new Board was empowered to "confirm the assessment or reduce, increase or vary the assessment" (s 51(4)). These provisions were in marked contrast to the former s 51(2) of the Act which had purported to confer upon the Board of Appeal an independent decision-making power in the same terms as that conferred on the High Court. A dissatisfied taxpayer had the option either to request the Commissioner to refer the challenged decision to a Board of Review for review or to request that the objection be treated as an appeal and that it be forwarded either to the High Court or to the Supreme Court of a State (see s 50).

The provision in the original Act which had declared that "an order of the Board on questions of fact shall be final and conclusive on all parties ... " (former s 51(2)) was repealed. Finally, the appeal provisions, which had originally allowed an appeal to the High Court, in its appellate jurisdiction, from any decision of the Board of Appeal "except a decision ... on a question of fact" (s 51(8)), were substantially modified so as to provide that the Commissioner or a taxpayer could appeal to the High Court in its original jurisdiction from any decision of the Board "which, in the opinion of the High Court, involves a question of law".

When the validity of the reconstituted Taxation Board of Review was challenged in the High Court, the Court held that the powers of review conferred upon the Board

77

78

See, for example, Re Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634; cf Re Aston and Secretary, Department of Primary Industry (1985) 8 ALD 366. The BIO case (1925) 35 CLR 422 at 435-436 per Isaacs J; at 445 per Starke J.


not part of the judicial power of the Commonwealth.79 Justice Isaacs, in the lead.ll1lg judgment, said that the assimilation of the Board's powers and functions to

of the Commissioner together with the substitution of a right of "appeal" to the Court in its original jurisdiction instead of, as previously, to the Full Court of the Court provided clear evidence of Parliament's intention to confer administrative,

judicial, power on the Board of Review.80 In a passage redolent of the American "public rights doctrine", to which I will

refer, his Honour said that there are some functions which, of their nature, "are ~~,.t"1,..,,.,:"t-" exclusively to judicial action"; there are some which are "inconsistent with

action"; but there are others which are "consistent with either strictly ,,u.._ ....... ~~ or executive action". Where this duality exists, the matter must be examined

in the light of the relevant legislation in order to decide how the function should be characterised. 81

The function in question may involve "merely the incidental or ancillaVz determination of circumstances as a factum for the operation of the legislative will". 2

The "ascertainment or determination in a judicial manner of facts, whether controverted or not, for the purpose of carrying out executive functions in a just way is a secondary or incidental function attached to and taking its dominant character from the main purpose" (emphasis added). However, the same function, when exercised by a court, will be "primarily judicial".83 The character of the function thus "takes its colour largely from the primary character of the functionary, and depends also on how the decision is made binding and how enforced".84 Where the function is "subject to no a priori exclusive delimitation", it may be "capable of assignment by Parliament in its discretion :to more than one branch of government".85

In upholding the decision of the High Court, on appeal, the Privy Council specifically approved the duality doctrine expounded by Isaacs J and agreed with the majority view that decisions of the Board of Review were properly characterised as an

. exercise of administrative, not judicial, power. 86 However, in differentiating the function of the Board from that of a court (when

exercising jurisdiction by way of statutory appeal) their Lordships sought to accommodate the Board's function to the orthodox view of judicial power (that is, the primary or private law aspect of that power) and in so doing, in the writer's respectful

. view, only served to confuse the issue. Their Lordships noted that decisions of the Board on questions of fact were no longer expressed to be "final and conclusive" and that only decisions of a court carried that consequence. This was said to provide a "convincing distinction" between a decision of the Board, on the one hand, and that of a court, on the other. They nevertheless went on to acknowledge that there are tribunals "with many of the trappings of a court which nevertheless are not courts in the strict sense of exercising judicial power"; that a tribunal is not necessarily a court because it

Munro (1926) 38 CLR 153. Ibid at 175; cf at 200-201 per Higgins J; at 212 per Starke J. Ibid at 175-176. "Factum", relevantly, means an "act" or "deed". Ibid at 176. Ibid at 178. Ibid. Emphasis added. Shell Co (1930) 44 CLR 530 at 544.


gives a final decision in respect of a controversy between contending parties which affects the rights of subjects; and that there may be an appeal to a court from the decision of such a tribunal. 87

The Privy Council's ultimate conclusion was expressed somewhat guardedly. Their Lordships were of the opinion that it is "not impossible under the Australian Constitution for Parliament to provide that the fixing of assessments shall rest with an administrative officer, subject to review, if the taxpayer prefers, either by another administrative body, or by a Court strictly so called ... ".88'

In acknowledging that the function of reviewing justiciable public law controversies was not exclusively judicial, the decisions of the High Court and the Privy Council undoubtedly represented a major turning point in the development of the concept of judicial power. They opened the way for Parliament to establish mechanisms for administrative review of such decisions as an alternative to statutory appeal to the courts. What the decisions left unresolved, however, was whether the existence of a right of judicial review by way of statutory appeal was essential to the validity of an alternative right of administrative review and whether an administrative tribunal could conclusively decide questions of fact.89 Both these issues will be considered later.

The duality principle was further developed by the High Court in its decisions in Farbenfabriken Bayer A-G v Bayer Pharma Pty Ltd (1959) and Quinn (1976). Both cases concerned the function of reviewing administrative decisions made by the Registrar of Trade Marks under the Trade Marks legislation. In Bayer Pharma90 it was held that the review of a decision granting a disputed application for registration of a trade mark was capable of being conferred either on a Chapter ill court or on an administrative body, as Parliament may determine. It had been argued that the function of review was primarily administrative in character and did not, when conferred upon the High Court, involve the exercise of judicial power. The High Court rejected these arguments, holding that the provision in question was, on the one hand, "apt to confer judicial power" in respect of a subject-matter fit for the exercise of that p9wer and, on the other, appropriate, having regard to the context and to the person by whom the power was to be exercised, to confer administrative power.91

A similar conclusion was reached in Quinn,92 where the function in question was that of resolving a dispute with respect to the removal of a registered trade mark from the Register of Trade Marks. An attempt was made to distinguish Bayer Pharma on the ground that, whilst the function of registering a trade mark may be administrative, the function of deciding that a registered trade mark should cease to be registered involved the determination of a controversy with respect to existing rights of property and, as such, fell within what I have described as the primary or private law aspect of exclusive judicial power. Moreover, so it was argued, such a function had always been regarded, historically, as involving an exercise of judicial power.

87 88 89

90 91 92

Ibid at 544-545. Ibid at 544. Emphasis added. See, for example, G Sawyer, "Judicial Power under the Constitution" in R Else-Mitchell (ed), Essays on the Australian Constitution (2nd ed 1961) 71 at 74-76. (1959) 101 CLR 652. Ibid at 659-660. (1977) 138 CLR 1.


The High Court rejected these arguments. The Court regarded the function both of ~~,,, .. ,1nu- and of removing a trade mark as essentially administrative, and as being capable of being classified as either judicial or administrative, depending on the way in which it was to be exercised. 93 It was a matter for Parliament whether the function was

to a court or to an administrative officer or tribunal. The history of the trade marks legislation was not seen as sufficient to establish that the rights in question were ''basic rights" of a kind which "traditionally and therefore, historically" are protected and enforced exclusively by the exercise of judicial power.94 In other words, as the ·writer would contend, the rights in question were public law rights, not private law · rights, the protection and enforcement of which falls within the primary aspect of ·exclusive judicial power. The fact that the review proceedings before the Registrar . were clothed in the "trappings of litigation" was not seen as altering the essentially administrative nature of the function.95 Significantly, none of the judges seemed to

·regard the existence of the alternative right of direct access to a court by way of statutory appeal as crucial to the validity of the administrative review jurisdiction.90

Findings of fact/opinions on the law/trappings of litigation The other major functions falling within the duality doctrine which need presently to be noted are the adjudicatory functions of fact-finding, forming opinions on questions of law and the incidental procedural powers of summoning witnesses, hearing evidence and the like- referred to, compendiously, as the "trappings of litigation". In Australia, these functions have been accepted as necessary and appropriate concomitants of any formal process of adjudication between contending parties, whether the functions be exercised by a court or by an administrative body. They are not necessarily indicative of the existence of judicial, as distinct from administrative, power.97 Many of the more recent cases concerned with the essential differences between "arbitral" and judicial power have focused on this aspect of the duality

· doctrine. The principles enunciated are nevertheless equally applicable to the powers and functions exercised by an administrative tribunal such as the AAT.98

In R v Hegarty; ex parte Salisbury City Corporation,99 for example, the function conferred on an administrative Board - a Board of Reference - involved the determination of a dispute as to the classification of employees for salary purposes under an industrial award. It was argued that performance of this function necessitated an exercise of judicial power because it required a determination as to the rights of the parties by applying the criteria established under the award to the facts as found. In terms of the award, the decision of the Board was bindin§ on the parties unless set aside by the former Australian Industrial Court on appeal.1°

93 Ibid at 5 per Barwick CJ; at 6 per Gibbs J; at 8 per Jacobs J, Stephen and Mason JJ agreeing; at 12 per Murphy J. Ibid at 11 per Jacobs J. Ibid at 5 per Barwick CJ; at 6 per Gibbs J; at 8-9 per Jacobs J; at 12 per Murphy J. Cf Rola Co (1945) 69 CLR 187 at 217-218 per Williams J. · Drake (1979) 2 ALD 60 at 65; Shell Co (1930) 44 CLR 530 at 544; Quinn (1977) 138 CLR 1 at 5, 6, 8-9 and 12. Precision Data Holdings (1991) 173 CLR 167 at 189. (1981) 36 ALR 275. Ibid at 280.


In rejecting these arguments, Mason J (with whose reasons Gibbs CJ Stephen and Wilson JJ agreed) said that "the application of prescribed criteria to facts may be, and frequently is, an element in the administrative, as well as the judicial function".101 In the present case, the Board's function was necessarily of the same administrative character as the function of an employer in making an appointment or promotion of an employee. The Board stood "in the shoes of the employer" .102 There was nothing "in the award or in the nature of the Board to suggest that it is to approach the question in such a different fashion that one could say that the function which was administrative at first instance involves the exercise of judicial power by the Board".103

In a separate judgment, agreeing in substance with that of Mason J, Murphy J commented on the fallacy in the argument that "at the federal level all determinations of fact (or of law) must be made by courts exercising the judicial power of the Commonwealth". His Honour continued:

[T]he exercise of the executive power of the Commonwealth requires the daily exercise of adjudicative functions, similar analytically to those performed by the courts exercising judicial power. It would be hairsplitting to distinguish the judicial functions of many federal administrative agencies from those carried out by courts. Administrative determinations made by these agencies are not binding on the courts, but in practice and unless set aside by courts are operative and constitute the cement which binds the whole administrative process. The judicial and executive powers thus overlap, but of course far from completely.

Whether adjudication is treated as part of the judicial power or not is often in practice the decision of the legislature. If it places the function with a court (within Ch III) then in general the adjudicative power is treated by this court as part of the judicial power of the Commonwealth, if not, it is treated as administrative adjudication.10ll

In this respect, the views expressed by his Honour mirror very closely the observation by McTiernan J in Tasmanian Breweries that:

(I]t is commonplace in the field of administrative law that adjudication is not distinctive of judicial power exclusively; and it is not necessarily inconsistent with true executive or administrative action.105

That a power of "adjudication" is not seen as an exclusively judicial function is placed beyond argument, in the writer's view, by the decision of the High Court in the New South Wales v The Commonwealth (the Wheat case).106

In contrast to Hegarty, the High Court in Re Cram; ex parte The Newcastle Wallsend Coal Co Pty Ltd, 107 held that it was no part of the function of a Local Coal Authority, established for the purpose of settling industrial disputes, to decide that employees involved in a dispute had been wrongly stood down and, as a consequence, were entitled to payment of wages during their time off work. A claim "for the enforcement of a provision in an award for the payment of wages to an employee" was, in the view of the majority, "a claim for the enforcement of an existing legal right".108 Such claims

101 102 103 104 105 106 107 108

Ibid at281. Ibid at280. Ibid. Emphasis added. Ibid at284. (1970) 123 CLR 361 at 371. (1915) 20 CLR 54 at 64 per Griffith CJ; at 83-87 per Isaacs J; and at 106-107 per Powers J. (1987) 163 CLR 140. Ibid at 148. Emphasis added.


necessarily invoke the exercise of what the writer describes as the primary aspect of exclusive judicial power. The Local Coal Authority, being constituted as an arbitral body and not as a Chapter III court, was acting unconstitutionally in purporting to exercise the power that it did.

In the course of their decision, however, the majority Judges dismissed the suggestion that an industrial tribunal cannot interpret laws, awards and other instruments for the purpose of discharging its arbitral functions. The formation of views and opinions on matters of interpretation, their Honours said, did not "in itself amount to a usurpation of judicial power".109

This point was reinforced in Re Ran!(er Uranium Mines Pty Ltd; ex parte Federated Miscellaneous Workers' Union of Australia. no In that case the Full Court affirmed that the finding of facts and the formation of an opinion as to the existing legal rights and obligations of the parties to an industrial dispute do not involve the exercise of judicial power and do not cease to be an exercise of arbitral power if these processes are no more than steps towards the discharge of the arbitral function of making an award "intended to regulate the future rights of the parties" .111

The fact is, as the High Court recently affirmed, that there are "many positive features which are essential to the exercise of [judicial] power" but which are not "by themselves conclusive of it". The Court went on to say:

Thus, although the finding of facts and the making of value judgments, even the formation of an opinion as to the legal rights and obligations of parties, are common ingredients in the exercise of judicial power, they may also be elements in the exercise of administrative and legislative power.112

The application of those principles to the decision-making functions of the AAT will be considered later.

Duality of functions - summary It follows that the functions "which may be classified as either judicial or administrative, according to the way in which they are to be exercised'}l3 and which lie in "the borderland in which judicial and administrative functions overlap",114 include the following:

(i) The substantive function of reviewing on the merits justiciable public law disputes over administrative decisions in respect of rights, privileges or liabilities made in the exercise of statutory powers and discretions conferred by Parliament; and

(ii) The incidental adjudicative and procedural functions necessary for the proper performance of the substantive review function. These incidental functions include conducting a hearing, summoning witnesses, administering oaths and affirmations, making findings of fact and value judgments, and forming opinions on questions of law and the like.

109 llO 111 ll2 ll3 ll4

Ibid at 149. (1987) 163 CLR 656 at 663-666. Ibid at 666. Emphasis added. Precision Data Holdings (1991) 173 CLR 167 at 189. Hegarty (1981) 36 ALR 275 at 281. John East Ironworks Ltd [1949] AC 134 at 149.


It is presently unnecessary to explore the duality principle further. It may be noted, however, that the borderland also encompasses those essentially administrative (or non-judicial) functions which may nevertheless appropriately be conferred upon a Chapter III court, because they are seen as incidental to the exercise of strictly judicial power.115

The American "public rights" doctrine A doctrine resting on similar conceptual foundations to the duality doctrine has long been accepted by the United States Supreme Court,l16 albeit with important differences in outcome. In the writer's view, it provides strong persuasive support for the private law /public law dichotomy earlier suggested.

As in Australia, it has been recognised that there are some "inherently judicial" functions which require the exercise of judicial power and that there are others which are inappropriate to the exercise of that power.117 At the same time, as the Supreme Court said in Murray's Lessee v Hoboken Land & Improvement Co:

[T]here are matters, involving public law rights, which may be presented in such form that the judicial power is capable of acting on them, and which are susceptible of judicial determination, but which Congress may or may not bring within the cognizance of the courts of the United States as it may deem proper.118

Under this doctrine the United States Supreme Court has upheld the constitutionality of legislative courts, or "Article I courts" as they are also known,119 and of administrative agencies created by Congress to adjudicate issues involving public rights.120 The doctrine has been said to extend only to matters arising "between the Government and persons subject to its authority in connection with the E_erformance of the constitutional functions of the executive or legislative departments" 1 and "only to matters that historically could have been determined exclusively by those departments. ul22

115

116 117

118 119

120

121 122

As Brennan J explained in the Northern Pipeline Co v Marathon Pipe Line Co:

Davison (1954) 90 CLR 353 at 368-369; cf now s 55 of the Bankruptcy Act 1966 (Cth); see also Queen Victoria Memorial Hospital v Thornton (1953) 87 CLR 144 at 151; R v Federal Court of Bankruptcy; ex parte Loewenstein (1938) 59 CLR 556; Victoria v Australian Building and Construction Employees' and Builders' Labourers' Federation (No 2) (1982) 152 CLR 179 at 183; Precision Data Holdings (1991) 173 CLR 167 at 189. 18 How 272 at 284 (1856). See, for example, Federal Radio Commission v General Electric Co 281 US 464 (1930) where it was held that a court could not be given power to perform the administrative function of awarding a radio licence. 18 How 272 at 284 (1856). Emphasis added. See E Chemerinsky, Federal Jurisdiction (1989) at 182-183. Legislative courts are created pursuant to the legislative power conferred on Congress pursuant to Art I, s 8(9) to "constitute tribunals inferior to the Supreme Court". Judges of legislative courts do not enjoy the security of life tenure nor the salary guarantees conferred by the United States Constitution on judges of Art III courts. Atlas Roofing Co Inc v Occupational Safety and Health Review Commission 430 US 442 at 450 (1977). Crowell v Benson 285 US 22 at 50 (1932). Northern Pipeline Co v Marathon Pipe Line Co 458 US 50 at 68, 73 LEd 2d 598 at 613 (1982).


The understanding of these cases is that the Framers expected that Congress would be free to commit such matters completely to non-judicial executive determination, and that as a result there can be no constitutional objection to Congress' employing the less drastic expedient of committing their determination to a legislative court or an administrative agency.123

The distinction between public rights and private rights has not been definitively explained by the United States Supreme Court.124 Indeed in Thomas v Union Carbide Agricultural Products Co, O'Connor J, giving the majority opinion of the Court, observed that the "theory that the public rights/private rights dichotomy ... provides a bright line test for determining the requirements of Article III did not command a majority of the Court in Northern Pipeline."125 Justice Brennan, on the other hand, with whom Justices Marshall and Blackmun agreed, explained the majority opinion in Northern Pipeline as having decided that "public rights cases, as that concept had come to be understood, involved disputes arising from the Federal Government's administration of its laws and programs". Whilst not attempting to provide any generally applicable definition of "public rights", his Honour concluded that, at a minimum, public rights disputes must arise "between the Government and others."126

Some commentators in America have expressed frustration with the imprecision of the expression "inherently judicial" by which the United States Supreme Court has characterised exclusive judicial power.l27 In the Australian context, it may equally be said that the notion of "basic rights" adopted by the High Court in Quinn, and the correlative notion of "public law rights, privileges and liabilities" which I have espoused, suffer from similar imprecision. Both expressions are readily susceptible of broad description, but not of precise definition. However, the flexibility which the courts thus retain to determine, as occasion arises, the matters that are "inherently judicial" or that concern the "basic rights" of the individual - matters, in other words, that go to the heart of judicial power- is, in the writer's view, by no means to be deplored. In making any such evaluation, it is no doubt important, as was said by O'Connor J in Union Carbide Agricultural Products, that "practical attention to substance rather than doctrinaire reliance on formal categories should inform the application of Art III" (or, in our case, of Chapter III of the Constitution).128

It is unnecessary, for present purposes, to pursue the role of legislative courts in public law matters, as there are no comparable federal courts in Australia.129 Of greater relevance, in the present context, is the fact that the power of Congress to create such courts has been seen as carrying with it the lesser power to create administrative

123 124 125 126 127

128

129

Ibid at 68. Ibid at 69 per Brennan J. 473 US 568 at 585-586 (1985). Ibid at 596-597. See, for example, M Redish, Federal Jurisdiction: Tensions in the Allocation of Judicial Power (1980) at 44. 473 US 568 at 587 (1985). Cf Pochi (1980) 31 ALR 666 at 685 with respect to the power to order deportation. , The strict interpretation of Chapter III of the Constitution adopted by the High Court would preclude the creation of any "court" not complying with the requirements of that Chapter: see Alexander (1918) 25 CLR 434. As to the place of legislative courts under the United States Constitution, see E Chemerinsky, above n 119 at ch 4. In Australia, the only courts analogous to legislative courts are the courts for federal territories (see Spratt v Hermes (1965) 114 CLR 226) and courts martial (see Re Tracey (1989) 166 CLR 518).


agencies for the same purpose, and to provide for review of those agency decisions in Art III courts.130

At least since the beginning of this century, it has been accepted by the United States Supreme Court that judicial power may be conferred upon (or "delegated to") an administrative agency.131 Professor Davis in his Administrative Law Treatise says that with only two exceptions (the power to administer what is deemed to be the criminal law, and the power to supplant juries), "federal courts throughout the twentieth century have allowed Congress to determine what judicial power to delegate to agencies" .132 As a consequence, federal agencies discharge many functions of a judicial nature that, in the Australian federal context, would give rise to serious constitutional questions.133 The delegation of such powers to administrative agencies is deemed acceptable, so long as decisions of the agency are susceptible of judicial review before an Article III court.134

It may be a consequence of this fairly liberal approach to the delegation of judicial power that American jurisprudence has come to regard adjudication as the hallmark of judicial power. Thus, Professor Shwartz asserts that the "power to hear and decide cases is judicial power, whether it be exercised by a court or an administrative agency ... ".135 In American Jurisprudence it is said that:

In speaking of a power or function which pertains more to the administrative than to the judicial, yet partakes of the judicial, the courts refer to it as "quasi-judicial" or "judicial in nature" or "adjudicatory". The term "quasi-judicial" is also used to designate a judicial function, but to indicate that it is exercised by a person other than a judge. The use of such terms is simply a convenient way of approving the exercise of a judicial power by an administrative agency or ~proving review by the courts of the exercise of powers by administrative agencies.1

In Australia, on the other hand, the strict separation of the judicial power of the Commonwealth has necessitated a different perception of the adjudicative function when exercised by an administrative body. The power of adjudication, as we have seen, is not regarded in this country as exclusively a judicial function.l37

It is apparent, therefore, that considerable care is needed in translating to the Australian federal context American decisions as to the powers and functions of administrative agencies. Nevertheless, the public rights doctrine, which has guided American jurisprudence in this important area of constitutional law, serves as a useful analogy to the duality of functions doctrine that is now accepted as settled law in Australia. The differences in outcome, however, are of fundamental importance.

130 131

132 133

134 135 136 137

Atlas Roofing Co 430 US 442 at 450 (1977). See K C Davis, Administrative Law Treatise (2nd ed 1979) Vol 1 at 182-192; B Schwartz, Administrative Law (1979) at 59-86; and see Sunshine Anthracite Coal Co v Adkins 310 US 381 at 400 (1940). A stricter view of the separation of judicial power is evidently still maintained in some States, eg, the State of Illinois- seeK C Davis at 184-185. K C Davis, above n 131 at 182. Ibid at 188-192; B Schwartz, above n 131 at 70-85; and see, for example, Atlas Roofing Co 430 US 442 (1977) upholding an order by an administrative agency for payment of a civil money penalty for breach of safety standards. Northern Pipeline 73 LEd 2d 598 at 614 (1982), note 23; cf B Schwartz, above n 131 at 63. See B Schwartz, above n 131 at 59-60; cf K C Davis, above n 131 at 186-187. (2nd ed 1962) Vol1 Administrative Law at para 161. Emphasis added. The Wheat case (1915) 20 CLR 54: Hegarty (1981) 36 ALR 275 at 284 per Murphy J.


ARE ALTERNATIVE RIGHTS OF REVIEW NECESSARY?

·. It will be recalled that in Munro, Isaacs J had referred to functions falling within the · · duality principle as being "capable of assignment by Parliament in its discretion to more • than one branch of government".138 Similarly, the Privy Council in Shell Co placed

·· · considerable importance upon the availability to the taxpa~er of the option of taking an objection either to a court or to the Board of Review.l 9 It seems implicit in their Lordships' reasoning that the issues in question had to be capable of being resolved by the exercise of judicial power, and that the alternative of administrative review was only constitutionally sustainable as long as direct access to the courts by way of statutory appeal was provided. However, as the legislation under challenge allowed adequate access to the courts, it was unnecessary for either the High Court or the Privy Council to elaborate on the issue.

In taxation matters, there are valid constitutional grounds for concluding that access to the courts, so as to enable an assessment to be contested, must be provided.140 Laws imposing an incontestable tax have been described as "undermining judicial power",141 but the constitutional objection to such laws seems now to be regarded as resting primarily upon the principle in the Australian Communist Party v The Commonwealth.142

Justice Brennan, in the course of his decision in MacCormick v Federal Commissioner of Taxation, specifically adverted to the need for some form of judicial review of a taxation assessment. Where Parliament "imposes a tax by reference to prescribed criteria, it is for the courts and not for the executive to determine whether each of those criteria exist in the particular case". His Honour then continued: "[A]n opportunity to obtain a judicial determination as to the existence of the fact may be validly limited (as it is under the Income Tax Assessment Act) to judicial proceedings on appeal from disallowance of an objection to an assessment, but it cannot be wholly excluded."143

The jurisdiction in taxation matters formerly exercised by the Taxation Boards of Review was transferred to the AAT as from 1 July 1986. An alternative right of direct access to the Federal Court has been maintained. g4 Subject only to the question raised by Gummow J in TNT Skypak Ltd v Federal Commissioner of Taxation145 as to the adequacy of s 44 of the AAT Act in relation to taxation appeals, the legislation conferring review jurisdiction on the AAT appears to allow the taxpayer adequate alternative rights of review.

138 (1926) 38 CLR 153 at i78. Emphasis added. 139 (1930) 44 CLR 530 at 544. 140 Bayly v Federal Commissioner of Taxation (1952) 86 CLR 506 at 509-510 per Williams J; Deputy

Federal Commissioner of Taxation v Brown (1958) 100 CLR 32 at 40-41 per Dixon CJ and at 52 per Williams J; cf MacCormick v Federal Commissioner of Taxation (1984) 158 CLR 622 at 639-643 per Gibbs CJ, Wilson, Deane and Dawson JJ; at 646 per Murphy J; and at 658 per Brennan}.

141 MacCormick (1984) 158 CLR 622 at 646 per Murphy J; cf at 658 per Brennan J; see also Brown

142 (1958) 100 CLR 32 at 52 per Williams J. , (1951) 83 CLR 1; see MacCormick (1984) 158 CLR 622 at 639-640 per Gibbs CJ, Wilson, Deane and Dawson JJ; L Zines, above n 13 at 167-168.

~:! (1984) 158 CLR 622 at 658. Section 187 of the Income Tax Assessment Act 1936 (Cth) and part IVB, Taxation

145 Administration Act 1953 (Cth). (1988) 82 ALR 175 at 178-182


The question must be asked, however, whether the availability of alternative rights of review is constitutionally necessary in any other areas of administrative review committed to the AAT. One possible interpretation of the Shell Co decision is that the requirement as to alternative forums extends to all administrative decisions the review of which raises justiciable issues.146 Williams J in Rola Co certainly regarded the decision as applying equally to the determination of controversies with respect to industrial property rights - controversies which, his Honour said, "must, in the last resort, unless the subject prefers otherwise, be determined by a court".147 It may be argued, however, that this interpretation of Shell Co rests upon a conception of judicial power that is quite inconsistent with more recent decisions of the High Court. In Quinn, for example, the High Court distinguished between what I have described as "public law rights" derived from statute, the administration of which rests with the executive arm of government, and "basic rights", the protection and enforcement of which rests within the exclusive power of the courts.148 This important distinction tends to negate any general proposition that rights by way of statutory appeal to Chapter III courts must be provided whenever a dispute over the exercise of administrative power gives rise to a justiciable issue. As Jacobs J said in Quinn, "[T]he determination of those matters (ie disputes over industrial property rights) can be the subject of judicial power if Parliament chooses to make them so"; but they are not necessarily so.149 Although the Trade Marks Act 1955 (Cth) in fact provided alternative rights of access to a court or an administrative officer to resolve disputes as to withdrawal of industrial property rights, it seems to follow that access to the court was not constitutionally necessary in order to sustain the validity of the alternative right of administrative review.150

Thus, unless direct access to the courts is required on grounds of fundamental constitutional principle, it is a matter for Parliament whether to provide for review of a particular administrative decision and, if so, in what forum. Apart from taxation matters, which include, of course, customs and excise matters,151 there do not appear to be any other review jurisdictions currently conferred on the AAT in which it is constitutionally necessary for Parliament to allow a concurrent right of direct access to the courts.

CONCLUSIVE DETERMINATIONS OF FACT

The other issue left in some doubt by the Privy Council decision in Shell Co was whether an administrative tribunal such as the Taxation Board of Review could give a "final and conclusive" decision on a question of fact. This question is of considerable importance, so far as the AAT is concerned, given that its decisions are only reviewable on appeal to the Federal Court "on a question of law" (s 44 AAT Act) and that, absent

146 147 148 149 150 151

Cf Munro (1926) 38 CLR 153 at 178 per Isaacs J. (1945) 69 CLR 185 at 218. (1977) 138 CLR 1 at 11. Ibid at 10. Cf L Zines, above n 13 at 166. Section 167 of the Customs Act 1901 (Cth) enables a collateral challenge to be brought before a court in relation to a customs tariff classification decision; cf s 273GA of that Act as to administrative review of such a decision before the AAT; see also A N Hall, "The Jurisdiction of the Administrative Appeals Tribunal in Customs Matters" (1986) 14 Aust Bus L Rev 157.


any material error of law, the Court will normally be bound by the facts as found by the Tribunal.152

It will be recalled that, in Shell Co, the Privy Council had placed considerable significance on the fact that, whereas decisions of the original Board of Appeal had been expressed to be "final and conclusive on all parties" on questions of fact (see ss 51(2) and (8) of the original Act), decisions of the Board of Review were not stated to be conclusive for any purpose whatsoever. Its decisions were subject to appeal if "in the opinion of the High C0urt" the decision "involves a question of law" (s 51(6)). This new provision was construed as meaning that, provided some question of law was involved, "the whole of the decision of the Board was open to review, not merely the question of law".153 The appeal was by way of rehearing and the court could, therefore, substitute its own findings of fact.154 In cases not involving a question of law, however, - or, in other words, in those cases turning purely on questions of fact - decisions of the Board of Review could not be challenged.

Thus, whilst the new appeal provisions may have allowed the court greater scope to review questions of fact than the former s 51(8), 155 there were, doubtless, decisions of the Board of Review on questions of fact which did not involve a question of law and which were, in effect, final and conclusive because they could not be reviewed by the courts.156 The suggested ground of distinction between decisions of the original Board of Appeal and those of the Board of Review (lack of conclusiveness on questions of fact) may, therefore, be difficult to sustain.

The question as to the power of an administrative tribunal to make conclusive findings of fact again came before the High Court in a rather different context in Rola Co157 - a decision which has prompted much academic analysis and criticism.158 Like the later decisions in Re Cram and Re Ranger Uranium Mines Pty Ltd, Rola Co was concerned with the line between arbitral and judicial power, rather than that between strictly executive and judicial power.

Reduced to its essence, the question for determination by the High Court was whether a conclusive fact-finding function committed to a Committee of Reference appointed under the Women's Employment Regulations involved an attempted delegation of part of the judicial power of the Commonwealth to an administrative body not constituted as a court under Chapter III of the Constitution.

A Women's Employment Board had been established under the Regulations to decide (inter alia) whether females could be employed on certain work (briefly, "men's work") and, if so, to decide matters such as conditions of employment and rates of pay. Regulation 9 provided that every decision of the Board was to be binding on specified

152 Committee of Direction of Fmit Marketing v Australian Postal Commissioner {1979) 2 ALD 561 at 569; Commonwealth Banking Corporation v Percival (1988) 82 ALR 54 at 60; cf Waterford v The Commonwealth (1987) 71 ALR 673 at 689.

153 TNT Skypak (1988) 82 ALR 175 at 178 per Gummow J. 154 Commissioner of Taxation v Finn (1960) 103 CLR 165 at 167. 155 Cf TNT Skypack (1988) 82 ALR 175 at 178-182; see also Commissioner of Taxation v Brixius

(1987) 7 AAR 316. 156 157 158

Cf L Zines, above n 13 at 166-167. {1945) 69 CLR 185. See, for example, L Zines, above n 13 at 162-164; cf C Howard, Australian Federal Constitutional Law (2nd ed 1972) at 162-164.


employers, employees and organisations of employees affected by the decision. The decision was to have effect and be enforceable as an award of the (then) Conciliation and Arbitration Court. All the members of the High Court were agreed that the Board's functions were arbitral in character, concerned with the creation of new industrial rights and thus outside the judicial power of the Commonwealth.159

However, the Regulations went on to provide that, in relation to any decision of the Board, the Minister could refer to a Committee of Reference (a) any question as to which females employed by an employer were employed on (men's) work specified in the decision or (b) any question as to the nature of the work on which those females were employed. A determination made by the Committee was expressed to be "binding on the employer and females specified in the determination" and to be "evidence of any matters of fact so specified")60

It was argued that the power thus conferred was a power to decide, in a controversy between subjects, an issue relating to a disputed fact and that such a power was essentially judicial in character. In any subsequent legal proceedings for recovery of wages, it was submitted, the issue of fact would be conclusively determined by the Committee's determination. This involved a usurpation of part of the judicial power of the Commonwealth.

By a narrow majority (Latham CJ, Starke and McTiernan JJ; Rich and Williams JJ dissenting), the High Court rejected these arguments. In the final analysis, the difference between the majority and minority opinions rested on the way in which the conclusive fact-finding power of the Committee was characterised. Latham CJ (with whom McTiernan J agreed) and Starke J appeared to regard the Committee's function as appropriately incidental to or as an adjunct to the undoubtedly arbitral power exercised by the Board.161 Neither of them regarded the function as an exercise of judicial power. The power to make "bindin~ and authoritative decisions as to facts", they said, was not exclusively judicial power. 62

Justices Rich and Williams, on the other hand, considered that the arbitral function committed to the Board was completed when it gave its decision as to the types of work in which females could lawfully be emploled and as to the relevant rates of pay and the hours and conditions of employment.16 The fact-finding task entrusted to the Committee was, in their Honours' view, an essential step in the exclusively judicial function of determining, in an action for recovery of wages, whether under the terms of the award the wages claimed were due.164 Justice Williams was of the opinion that where the determination of a controversy involved an exercise of judicial power, "any attempt to remit any of the elements involved in the determination in invitos the parties to any tribunal which is not a court, is an infringement of that power, and therefore completely null and void".165

159

160 161 162 163 164 165

(1945) 69 CLR 185 at 198 per Latham CJ; at 205 per Rich J; at 212 per Starke J; at 213 per McTiernan J; at 216 per Williams J. Women's Employment Regulations (Cth), reg 5C(5). (1945) 69 CLR 185 at 197-198 per Latham CJ and at 212 per Starke J. Ibid at 200-201 per Latham CJ and at 211-212 per Starke J. Ibid at 205 per Rich J; at 216 per Williams J. Ibid at at 206-207 per Rich J; at 216-218 per Williams J. Ibid at 217. Williams J drew no distinction between findings of fact made in the course of determining an action for the recovery of wages (an exercise of the primary aspect of


Many commentators have found the reasoning of the dissenting judges more persuasive, and it may well be that the opinions of Rich and Williams JJ are more consistent with the recent High Court decisions in Re Cram166 andRe Ranger Uranium Mines Pty Ltd.l67 However even if the opinions of the minority judges are preferred, the proposition of law supported by them is irrelevant for present purposes. It would only preclude Parliament from empowering an administrative body to make conclusive findings of fact where the making of those findings is an essential step in the exercise of the primary or private law aspect of judicial power, that is in the determination of the "basic" rights of the individual according to law.168

In fact, of course, the majority decision in Rola Co affirmed that the power to make conclusive findings of fact is itself a function falling within the duality doctrine and that it is not, exclusively, an element of judicial power. Shell Co was not regarded as requiring any contrary conclusion.

Administrative fact-finding in public law That it is constitutionally permissible for an administrative body, such as the AAT, to make "conclusive" findings of fact (albeit subject to important limitations that will be referred to) is supported, in the writer's view, by a consideration of the extent to which the courts, in the exercise of their supervisory jurisdiction, have conceded to ifle executive arm of government the power to make unreviewable findings of fact. If the primary decision-maker has such power, there can be no objection, in legal principle, to an administrative review body, such as the AAT, having a commensurate fact-finding power.

In the absence of any right of review on the merits by way of statutory appeal, an administrative decision may only be called into question before a court on grounds of material error of law.169 Those grounds afford only limited scope for review by the courts of findings of fact. Under the ADJR Act, such findings may be reviewed for error of law (s S(l)(f)) and on the ground that there was no evidence or other material to justify the making of the decision (s S(l)(h)). In the context of judicial review, "it has been accepted that the making of findings and the drawing of inferences in the absence of evidence is an error of law."170 On the other hand "there is no error of law simply in making a wrong finding of fact,"171 nor is "want of logic" synonymous with error of

166 167 168

exclusive judicial power) and findings made in the course of determining a dispute over public law rights (see at 218). In this latter respect, his Honour's views are inconsistent with the Full Court decision in Quinn (1977) 138 CLR 1. (1987) 163 CLR 140. (1987) 163 CLR 656. No such limitation applies under the United States Constitution: see Atlas Roofing Co Inc v Occupational Safety and Health Review Commission 430 US 442; 51 L Ed 2d 464 (1977); cf E Chemerinsky, above n 119 at 196-216 as to the use of legislative courts and administrative agencies as "adjuncts" to Article III Courts.

169 BTR PLC v Westinghouse Brake and Signal Co (Aust) Ltd (1992) 15 AAR 100 at 106; cf Bond (1990) 170 CLR 321 at 353 per Mason CJ; at 365 per Brennan J; at 369 per Deane J; and at 387 per Toohey and Gaudron JJ. Cf ss 5, 6 and 10 of the ADJR Act, s 75(v) of the Constitution and s 39B of the Judiciary Act 1901 (Cth).

170 Bond (1990) 170 CLR 321 at 356 per Mason CJ: cf Sinclair v M.aryborough Mining Warden (1975) 132 CLR 473 at 481 and 483.

171 Waterford v The Commonwealth (1987) 163 CLR S4 at 77 per Brennan J.


law.172 To what extent findings of fact said to be "unreasonable" or "arbitrary" may be open to challenge under the ADJR Act may yet need further clarification.173

What emerges clearly, however, as Mason CJ said in his judgment in Bond, is that: U]udicial review when applied to the traditional review functions of the superior courts in our system of justice, exercisable by means of the prerogative writs and the grant of declaratory relief and injunction, ordinarily does not extend to findings of fact as such. To expose all findings of fact, or the generality of them, to judicial review would expose the steps in administrative decision-making to comprehensive review by the courts and thus bring about a radical change in the relationship between the executive and judicial branches of government.l74

His Honour's judgment offers little encouragement for a more expansive approach by the courts towards the review of findings of fact, whether at common law or under the provisions of the ADJR Act. As the Chief Justice said:

[T]he content of the "error of law" ground of review in s.5(1)(f) is necessarily influenced by the scope and purpose of the A.D.(J.R.) Act as an element in the statutory scheme of review constituted by that Act and the A.A.T. Act. Two elements of that scheme are significant for present purposes. The first is that the A.A.T. Act alone provides for review on the merits; the second is that the two Acts draw a sharp distinction between errors of fact and errors of law.175

The fact is that, under the principles of judicial review, the courts have always acknowledged that it is the appropriate function of the executive arm of government to make findings of fact for the purpose of discharging its administrative functions. Not only is the finding of facts a necessary element in the administrative decision-making process and not exclusively a judicial function,176 it is a function which, absent any material error of law, is immune from judicial intervention.177

Findings of fact made by an administrator do not give rise to an issue estoppeL178 Nevertheless, so far as the statutory rights of the citizen are concerned, such findings are usually final and conclusive. As Isaacs J said in Munro: "Government could not be carried on without some administrative power of finally determining disputed facts".179

Conclusive findings of fact by the AAT In an appeal against a decision of the AAT on a question of law under s 44 of the AAT Act, the Federal Court sees its function as "essentially to undertake judicial review of

172 173

174 175 176

177

178

179

R v District Court; ex parte White (1966) 116 CLR 644 at 654 per Menzies J. See Bond (1990) 170 CLR 321 at 359-360; cf Detsongjarus v Minister for Immigration, Local Government and Ethnic Affairs (1990) 21 ALD 139 at 141 per Pincus J; and see P Bayne, "Judicial Review of Questions of Fact" (1992) 66 ALJ 96. (1990) 170 CLR 321 at 341. Ibid at 357. Precision Data Holdings (1991) 173 CLR 167 at 189; cf Munro (1926) 38 CLR 153 at 177; Rola Co (1945) 69 CLR 185 at 200-201 and 211-212. Bond (1990} 170 CLR 321 at 341; see also Sean Investments Pty Ltd v MacKellar (1981} 38 ALR 363 at 370-371. Pastras v The Commonwealth (1966} 9 FLR 152; Huysse v Snowy Mountains Hydro-Electric Authority (1975) 24 FLR 418; cf Re Powers and Commonwealth of Australia (1984) 6 ALD 187. (1926} 38 CLR 153 at 176-177. Cf Rola Co (1945) 69 CLR 185 at 198-199 per Latham CJ; at 211-212 per Starke J.


the Tribunal's decision",180 albeit a jurisdiction to be exercised with restraint.181 Thus, decisions of the Tribunal are subjected to substantially the same supervisory jurisdiction as are decisions of the primary administrator. On such an appeal the Federal Court is normally bound by the facts as found by the Tribunal and cannot itself review the evidence for the purpose of making its own findings.l82 Unless a finding by the AAT on a matter of fact is vitiated by error of law183 or unless there was no evidence or other material upon which its decision could properly be based,184 decisions of the Tribunal on questions of fact are final, in the sense that they are not subject to appeal, and conclusive, in the practical sense that they have a "binding force".185

Findings of fact and decisions on questions of fact made by the AAT as a step in its administrative review function have the same effect in law as findings and decisions made by the primary administrator (sees 43 AAT Act). It cannot, therefore, be a valid objection to the validity of s 44 of the AAT Act that, in the absence of material error of law, findings of fact made by the Tribunal are conclusive and that, on an appeal to the Federal Court, the Court is bound by those findings.186 To concede the power of conclusive fact-finding to the executive arm of government (whether that power be exercised by the primary administrator or by the AAT on review) derogates in no respect from the judicial power of the Commonwealth, because the function itself was never exclusively judicial. In the writer's view, nothing in Shell Co or Rola Co should be understood as requiring any contrary conclusion.

That is not to say that the AAT may conclusively decide facts upon which its jurisdiction may depend.187 Like any other statutory body, the Tribunal can only lawfully act within the limits of the authority conferred upon it. Where the Tribunal erroneously finds that factual preconditions to the exercise of its jurisdiction are satisfied, the Tribunal commits an error of law.188

180 BTR PLC (1992) 15 AAR 100 at 106; cf Sullivan v Department of Transport (1978) 1 ALD 383 at 409; Adamou v Director-General of Social Security (1985) 7 ALN, N 203 at 207; Minister for Health v Charvid Pty Ltd (1986) 10 ALD 124.

181 Blackwood Hodge (Aust) Pty Ltd v Collector of Customs (No 2) (1980) 3 ALD 38 at 49 per Fisher J.

182 Committee of Direction of Fntit Marketing (1979) 2 ALD 561 at 569; Commonwealth Banking Corporation v Percival (1988) 82 ALR 54 at 60; cf Waterford v The Commonwealth (1987) 71 ALR 673 at 689 per Brennan J.

183 Waterford, ibid. ~~: Collins v Minister for Immigration and Ethnic Affairs (1981) 4 ALD 198 at 201.

Quinn (1977) 138 CLR 1 at 11. In America, agency decisions are tested against the "substantial evidence" rule, which tests "the reasonableness not the rightness of agency findings of fact": see B Schwartz, above n 131 at 591-597: and see, for example, Universal Camera Corp v NLRB 34 US 474 (1951); cf R J Pierce, S A Shapiro and P R Verkuil, Administrative Law and Process (1985) at 357-363. Agency findings of fact that meet this test

186 187

are accepted as conclusive. Cf Percival(1988) 82 ALR 54 at 60; Waterford (1987) 71 ALR 673 at 689. R v Hickman; ex parte Fox and Clinton (1945) 70 CLR 598; Rola Co (1945) 69 CLR 185 at 196-197; for a similar conclusion in America, see Crowell v Benson 285 US 22 (1932); but cf S G Breyer and R A Stewart, Administrative Law and Regulatory Policy (2nd ed 1985) at 62-66.

188 Hickman (1945) 70 CLR 598 at 614; cfKuswardana v Minister for Immigration and Ethnic Affairs (1981) 35 ALR 186. .


This raises an interesting question with respect to s 31 of the AAT Act, which provides that where, for the purposes of the Act, the Tribunal decides that "the interests of a person are affected by a decision" (so as to ground an application for review under s 29 or an application for joinder as a party under s 30(1A)), the decision of the Tribunal is "conclusive". Where, however, the Tribunal decides that the person's interests are not affected, the person may appeal to the Federal Court under s 44(2) of the Act. Section 31 was obviously intended to further the remedial nature of the AAT Act by protecting a decision favourable to an intending applicant from judicial challenge. But, given (a) that the question whether a person's "interests are affected" lies at the threshold of the AAT's review jurisdiction under s 27 of the AAT Act;l89 (b) that the proper interpretation of that expression is not, in any event, a matter exclusively for the Tribunal to decide (c£ s 44(2)); and (c) that, despite the breadth of the expression, there are necessaril:(;; limits to the nature of the interests that may be accepted as relevantly affected, 90 it would seem, on principle, that s 31 would not protect a decision favourable to an applicant from challenge under s 75(v) of the Constitution or s 39 B of the Judiciary Act 1903 (Cth).191

DECISIONS ON QUESTIONS OF LAW

As with arbitral tribunals, it is constitutionally permissible for an administrative tribunal, such as the AAT, to form an opinion on a question of law - or, in other words, to "decide" the question- where it is necessary for the Tribunal to do so as a step towards the discharge of its function of administrative review.192 By forming such an opinion, the Tribunal seeks to mould its conduct according to law.193 Its duty in this regard is no less than that of the primary decision-maker whose decision is under review. It does not follow, however, that in deciding questions of law that necessaril~ arise, the Tribunal is thereby usurping the judicial power of the Commonwealth.1 4

Neither does it follow that the Tribunal's power to decide such questions is unlimited. The nature and extent of that power and the limits to which it is subject will now be explored.

Construction of statutes It is axiomatic that an administrative tribunal has power to construe statutes under which its review functions arise and to decide any questions of law necessarily involved.195 Where a statute on its proper construction so requires, the Tribunal may need to form an opinion as to the private law rights and obligations of an individual for the purpose of discharging its statutory function. Thus, for the purposes of the social

189 190 191 192

193

194 195

Re McHattan and Collector of Customs (1977) 1 ALD 67. Ibid at 70. Cf Bogaards v McMahon (1988) 80 ALR 342. Cf Re Ranger Uranium Mines Pty Ltd (1987) 163 CLR 656 at 663-666; Precision Data Holdings (1991) 173 CLR 167 at 189. Re Adams (1976) 1 ALD 251 at 257; cf Caffoor v Commissioner of Income Tax, Colombo [1961] AC 584 at 598. Cf Re Cram (1987) 163 CLR 140 at 149. See, for example, Collector of Customs (Tasmania) v Flinders Island Community Association (1986) 60 ALR 717 at 725; cf Re Pacific Film Laboratories Pty Ltd and Collector of Customs (1979) 2 ALD 144 at 151-155.


assets test, ~uestions as to the ownership of property at law or in equity may to be decided. 96 The date on which contractual obligations were entered into be relevant to the exercise of a statutory power or discretion,197 as may the

as to whether or not a debt is recoverable at law.l98 In overpayment cases, the between the judicial function of authoritatively deciding that a debt is due to

Commonwealth and the administrative function of deciding whether recovery of debt is, as a matter of discretion, appropriate, needs to be carefully observed.199

uH.~u ....... v,, .... questions It is the duty of an administrative tribunal with limited authority not to exceed those ·limits. 200 A tribunal may properly form an opinion, therefore, as to the extent of its authority, or as to the existence of statutory preconditions to the exercise of its authority, even though that opinion produces no legal effect.201 It has a duty to confine

·itself to the exercise of powers appropriate to the nature of the non-judicial functions committed to it. 202

Decisions made in the purported exercise of power Where jurisdiction to review a particular decision or class of decisions made under an

. enactment is conferred on the AAT,203 the Tribunal's jurisdiction extends not only to a · decision lawfully made in the exercise of the relevant statutory power, but also to a ·decision made in the purported exercise of that power.204

In Re Brian Lawlor Automotive Pty Ltd and Collector of Customs, the function that had been committed to the AA T was to review decisions made "under Division I of Part V of the Customs Act". That Division related to the licensing of warehouses for customs

· purposes. The Collector had purported to revoke the licence granted to the applicant company, he being of the opinion that, by force of s 33(3) of the Acts Interpretation Act 1901 (Cth), the power to grant a licence under that Division implied a power of revocation. The Tribunal, however, was of the opinion that no general power of revocation could be implied and that the Collector's decision could not be sustained

196

197 198

199 200 201

202

See, for example, Dineen v Secretary, Department of Social Security (1988) 17 ALD 1; cf Secretary, Department of Social Security v James (1990) 20 ALD 5. Secretary, Department of Housing and Constntction v Wildman (1984) 3 AAR 38 at 42. Re Buhagiar and Director-General of Social Services (1981) 4 ALD 113 at 121-123; but see now s 1237 of the Social Security Act 1991 (Cth); cf Church v Secretary, Department of Education (1987) 73 ALR 69 at 84 per Sheppard J; at 96 per Neaves J; 105-106 per Everett J. Re Taylor and Director-General of Social Security (1984) 6 ALD 500 at 503-504. Re Adams (1979) 1 ALD 251 at 257. R v Hickman; ex parte Fox and Clinton (1945) 70 CLR 598 at 618 per Dixon J; cf Tasmanian Breweries (1970) 123 CLR 361; and see Kuswardana v Minister for Immigration and Ethnic Affairs (1981) 35 ALR 186. Re Cram (1987) 163 CLR 140 where the Local Coal Authority failed to recognise that the power it proposed to exercise was judicial power; cf Hegarty (1981) 36 ALl\. 275 where the Board of Reference had considered and rejected the argument that the power committed to it was judicial power- an opinion upheld by the High Court. See ss 25 and 26 AAT Act and the definition of "decision" ins 3. Collector of Customs (New South Wales) v Brian Lawlor Automotive Pty Ltd (1979) 2 ALD 1 affirming the decision of the President of the AAT in Re Brian Lawlor Automotive Pty Ltd and Collector of Customs (1978) 1 ALD 167.


under any power of revocation otherwise expressly conferred under that Division. The Federal Court agreed.

The critical question which arose was whether a decision purporting to have been made under Division I of Part V of the Act, but which was not authorised in law, could be reviewed by the Tribunal. The answer to this question depended, in turn, upon the proper construction of the AAT Act, in particular upon whether the decision in fact made was a decision made "in the exercise of powers" conferred by that Division. Brennan J, as President of the Tribunal, decided that the Tribunal had jurisdiction to review not only lawfully made decisions, but also decisions made in the intended exercise of a power, whether lawfully made or not.205 On appeal to the Federal Court, the President's decision was upheld (Bowen CJ and Smithers J; Deane J dissenting), although for slightly different reasons. All three judges agreed that a decision made in the purported exercise of a statutory power (which their Honours preferred to the more subjective "intended exercise of power" adopted by Brennan J) which involved a colourable, but invalid, exercise of a power actually conferred by statute, was reviewable before the TribunaL206

They disagreed, however, on whether a decision which involved a usurpation of power (as in the present case) was also reviewable. Chief Justice Bowen and Smithers J could see no valid ground for distinguishing between the two types of decision. Both were decisions in fact made; both were a nullity; and, as had been pointed out by Lord Reid in Anisminic Ltd v Foreign Compensation Commission, 207 there are "no degrees of nullity". Justice Deane, on the other hand, considered the distinction between a "colourable exercise of power" and a "usurpation of power" to be vital. In his Honour's view, where the relevant enactment confers no relevant power, the usurpation of power could not properly be regarded as a "decision under" the enactment.208

The line between the majority opinion and that of Deane J is not as clear, however, as the foregoing analysis may suggest. The question as to the absence of any relevant power of revocation under the Customs Act had been raised by the applicant, by way of a "jurisdictional point". This, as Bowen CJ pointed out, was "an awkward proposition", because, on the one hand, the applicant was seeking to invoke the Tribunal's review jurisdiction whilst, on the other, asserting that there was no reviewable decision.209 Ultimately, neither Bowen CJ nor Smithers J regarded the way in which the issue had arisen as critical_210 The decision of Deane J, on the other hand, seems to rest heavily on this point. In his Honour's view, the applicant was not seeking to invoke a jurisdiction which the Tribunal possessed, but rather to secure from the Tribunal "an authoritative determination of questions of fact or law anterior to the existence of that jurisdiction".211 If the AAT Act purported to confer any such power on the Tribunal, a serious question would arise, in his Honour's view, as to whether, to that extent, the Act attempted unconstitutionally to confer part of the judicial power of the Commonwealth on the AAT.

205 206 207 208 209 210 211

(1978) 1 ALD 167 at 181. (1979) 2 ALD 1 at 6 per Bowen CJ; at 21 per Smithers J; at 30-31 per Deane J. [1969] 2 AC 147 at 170. (1979) 2 ALD 1 at 30. Ibid at 6. Ibid at 6-7 per Bowen CJ; at 27 per Smithers J. Ibid at 31.


Despite this, Deane J agreed with Bowen CJ that, had the issue as to lack of power arisen during the hearing (as opposed to by way of a "jurisdictional" point), the position could have been different. Chief Justice Bowen seemed to contemplate that the applicant could have raised the issue by way of argument during the hearing.212 Both judges agreed that, if the respondent had raised the matter, the Tribunal would have had jurisdiction to decide the question. 213 However, as Bowen CJ observed, it would rarely be the respondent (that is, the decision-maker) who would advance the argument that his decision could not be supported in law.

What none of the judgments acknowledged, however, was that even if the parties had not raised the issue, the Tribunal itself would have been obliged, in the course of the hearing, to focus on the source of the power of revocation which the Collector had purported to exercise, in order to inform itself as to the nature and extent of the powers and discretions with which it was invested for the purpose of conducting the review (see s 43(1) AAT Act). If the issue had arisen in that way then, even on the view of Deane J, it would seem that the Tribunal would have had jurisdiction to decide the question.

In many respects, the most important aspect of Brian Lawlor was the unanimous view of the Federal Court that administrative decisions made in the "colourable exercise" of a power are reviewable before the AAT. Cases involving a usurpation of power are comparatively rare. The Tribunal, and more importantly, the parties were thus spared the sterile and technical legal t;:1sk of determining, as a pre-condition to the exercise of the Tribunal's review jurisdiction, that the decision under review was lawfully made and was not, on some ground relevant to the supervisory jurisdiction of the courts, a nullity.214

Constitutional questions It is one thing for the AAT to have jurisdiction to decide whether a decision-maker was authorised by or pursuant to an enactment to make the decision under review. It is quite another matter for the AA T to decide that a statute pursuant to which a decision was, on the face of it, lawfully made and which is the source of the Tribunal's powers of review, is invalid on the /round that it exceeds the legislative powers of the Commonwealth Parliament.21 A definitive answer to a question of constitutional validity can onl~ be given by a court exercising the judicial power of the Commonwealth.2 6 The question must be asked, therefore: is there any valid ground for concluding that it is either necessary or appropriate for the AAT to form an opinion on such a question as a step towards the discharge of its allotted administrative function?217

It is true that, during the course of his judgment in Brian Lawlor, Bowen CJ referred to "an appeal involving a constitutional question" as falling within the Tribunal's

212 213 214

215

216 217

Ibid at 6. Ibid at 6 per Bowen CJ; at 30 per Deane J. , (1979) 2 ALD at 4-5 per Bowen CJ; at 22-23 per Smithers J; at 30 per Deane J; cf (1978) 1 ALD 167 at 177-178 per Brennan J. Re Adams (1976) 1 ALD 251; cf Re McKie and Minister for Immigration, Local Government and Ethnic Affairs (1988) 8 AAR 80. Australian Apple and Pear Board v Tonking (1942) 66 CLR 77 at 104 per Rich J. Cf Re Ranger Uranium Mines Pty Ltd (1987) 163 CLR 656 at 666.


decision-making powers; but it is not clear what sort of question his Honour had in mind.218 Certainly, no question as to the constitutional validity of any provisions of the Customs Act 1901 (Cth) arose in that case.

There are, however, fundamental grounds for concluding that, on its proper construction, the AAT Act does not authorise the Tribunal to exercise any such function. The matter is best tested by considering the consequences that would follow, under the AAT Act, were the Tribunal to "decide" that an enactment was invalid. The facts in Re Adams and Tax Agents Board219 provide a good example. The applicant was a registered tax agent whose registration had been cancelled by a Tax Agent's Board pursuant to s 251K(3) of the Income Tax Assessment Act 1936 (Cth) on the ground that a sequestration order had been made against his estate. The legislation was, in this respect, mandatory leaving no residual discretion in the Board. Pursuant to s 251K(S) of the Act, the applicant nevertheless applied to the AAT for review, claiming (inter alia) that s 251K(3) was not a law with respect to taxation within the meaning of s 51(ii) of the Constitution and was, therefore, invalid.

Justice Brennan ruled that this was not a ground which could invoke the exercise of the Tribunal's powers and that the Tribunal could not grant relief on the ground that a statute is ultra vires the Commonwealth Parliament. 22'0 Such relief, his Honour said, must be sought, if at all, from a court exercising the judicial power of the Commonwealth.

What would have followed had the Tribunal considered the constitutional challenge to s 251K(3) and formed the opinion that the sub-section was invalid? In constitutional theory, a law made in excess of power is a nullity and may be treated as if it had never existed. 221 Consequently, a decision purporting to be made under such an enactment is equally a nullity. On the premise that there are "no degrees of nullity", it might be argued that, on the reasoning in Brian Lawlor, such a decision is nevertheless reviewable before the AAT as a decision made in the purported exercise of an administrative power.

There are, however, difficulties with this argument. In Brian Lawlor, because the power of revocation was said to arise by implication from the provisions of "Division I of Part V of the Customs Act", the decision of the AAT (affirmed by the Federal Court) that no such power could be implied had no consequential effect so far as the provisions conferring review jurisdiction on the Tribunal were concerned. The decision in question purported to have been made under Division I and was thus reviewable.

By contrast, if the Tribunal in Re Adams had formed the opinion tha.t s 251K(3) was invalid and had attempted to put that opinion into effect, it would have swept aside not only the foundation of the decision under review, but also the foundation of its review jurisdiction. If s 251K(3) were to be treated as if it had never existed, it would necessarily follow that s 251K(5), which purported to confer jurisdiction to review a decision under a non-existent sub-section, could have no legal effect. The Tribunal, in the event, could do no more than dismiss the application for want of jurisdiction, leaving the challenged decision intact and the applicant no better off.

218 219 220 221

Cf Re McKie (1988) 8 AAR 80 at 96. (1976) 1 ALD 251. Ibid at 259. South Australia v The Commonwealth (1942) 65 CLR 373 at 408 per Latham CJ.


A more fundamental ground for concluding that the AAT was not intended to exercise such a function may be traced back to the duality principle itself. In the circumstances of Brian Lawlor, the formation of an opinion by the Tribunal on the legality of the Collector's decision - a function otherwise central to the traditional supervisory jurisdiction exercised by the courts - can nevertheless be constitutionally justified because it was necessary for the Tribunal to inform itself as to the nature and extent of the administrative powers and discretions available to the Collector. By contrast, in Re Adams the opinion that the Tribunal was invited to form was not for any purpose relevant to its proper function of administrative review, but rather for the purpose of negating that function. Adapting the words of Deane J in Brian Lawlor,222 the invitation to the Tribunal to rule that s 251K(3) was unconstitutional was aimed, not at invoking the jurisdiction which the AAT possessed, but rather at securing an authoritative determination of a question of law anterior to the existence of that jurisdiction.

These considerations point inescapably, in the writer's view, to the conclusion that the AAT Act, on its proper construction, was not intended to, nor does it in fact, confer power on the Tribunal to decide a question as to the constitutional validity of legislation such as arose in Re Adams. If it did, the question as to the constitutionality of the AAT Act, to that extent, would necessarily arise.

Re McKie and Minister for Immigration, Local Government and Ethnic Affairs223 raised similar problems. The applicant, in respect of whom a deportation order had been made under s 12 of the Migration Act 1958 (Cth), applied to the AAT for review of the decision and sought to argue, as one of the grounds of his application, that s 12 was invalid. The Tribunal declined to consider the issue. The Tribunal was obliged, it said, to give effect to a duly enacted law "until such time as it is declared by a court of competent jurisdiction to be invalid".224 In the writer's view, that conclusion is entirely consistent with the scope and object of the AAT Act.225

It may be doubted whether anything would be gained, in such a case, by the Tribunal referring the question to the Federal Court for its opinion under s 45 of the AAT Act. If the challenge was upheld by the Court, the applicant's interests would not necessarily be advanced if, as a consequence, the AAT was deprived of jurisdiction. The course followed by the Tribunal in Re Adams and Re McKie, namely to restrict the Tribunal's consideration to the merits of the case, leaving the applicant to pursue the constitutional challenge before the courts, if so desired, seems eminently to be preferred. The applicant would not be prejudiced by the Tribunal so doing because, if the legislation was held to be invalid, the Tribunal's decision, like that of the primary decision-maker, would have no legal effect.226

These decisions should be contrasted with Re Reserve Bank of Australia and Comcare and Anor227 which provides a good example, in the writer's view, of a constitutional question which it was neither necessary nor appropriate for the Tribunal to consider. The Tribunal had before it for review a determination made by the Commissioner for

222 223 224 225 226 227

(1979) 2 ALD 1 at 31. (1988) 8 AAR 80. Ibid at 96. See s 15AA, Acts Interpretation Act 1901 (Cth). South Australian v The Commonwealth (1942) 65 CLR 373 at 408. (1989) 17 ALD 682.

Federal Law Review Volume22

Employees' Compensation (superseded by Comcare) bringing to an end the entitlement of a former employee of the Bank to compensation under the former Compensation (Commonwealth Government Employees) Act 1971 (Cth).

Although neither party raised the issue, the Tribunal nevertheless expressed its opinion that the Act purported, unconstitutionally, to invest the AAT with part of the judicial power of the Commonwealth. Legislation vesting review jurisdiction in the AAT would be ineffectual, said the Tribunal, "if the effect is to confer upon the Tribunal the power by its determination, within jurisdiction, to impose liability or affect rights".12s Taking away a right, the Tribunal continued, "is usuaUy a matter of judicial scrutiny". 229

The reasons given in support of these propositions rested heavily on the rcrivate law aspect of judicial power and on the view, firmly rejected in Quinn,2 0 that the withdrawal of rights conferred pursuant to an enactment necessarily involves the exercise of judicial power. In the writer's respectful view, the reasons failed adequately to recognise the fundamental distinction between the determination of controversies with respect to ''basic rights" (or private law rights) and the determination of controver~ies over public law rights of the kind falling within the duality of functions doctrine.

There is no doubt, of course, that the function of determining controversies over workers compensation rights is appropriate to the exercise of judicial power and that federal jurisdiction in such matters has, in the past, been conferred upon State courts.23'1 However, the function committed to the former Commissioner for Employees' Compensation was plainly administrative.232 There is nothing in the provisions of the Act conferring review jurisdiction on the AAT which transforms the essentially administrative nature of the Commissioner's function into a fundamentally different power when exercised by the AAT.233 Thus the function of the Tribunal, in the writer's view, involved the exercise of administrative not judicial power.

Despite the Tribunal's opinion that it was acting unconstitutionally in so doing, it nevertheless proceeded to decide the case before it on the merits. Neither party took up the constitutional issue by way of appeal or other proceedings in the Federal Court. In the writer's view, all that was achieved by canvassing the issue was to raise unnecessary doubts on a question of law that was outside the Tribunal's competence to decide. The question was not relevant to the proper exercise by the Tribunal of its functions of administrative review.

On the other hand, where the constitutional question that is raised before the Tribunal goes not to the basic constitutionality of the legislation, but rather to the proper construction, in accordance with the Constitution, of a statutory power or discretion, 234 the Tribunal is able to decide such a question as part of its normal

228 229 230 231 232

233 234

Ibid at 683. Ibid at 684. {1977) 138 CLR 1. See, for example, Anderson (1957) 97 CLR 345. Pastras v The Commonwealth (1966) 9 FLR 152; Huysse v Snowy Mountains Hydro-Electric Authority (1975) 24 FLR 418; Cf Quinn (1977) 138 CLR 1 at 10. Cf Hegarty (1981) 36 ALR 275 at 280 per Mason J. See s 15A, Acts Interpretation Act 1901 (Cth).

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function of construing the legislation from which its powers of review are derived.235 In such cases, it is within the Tribunal's discretion under s 45(1) of the AAT Act whether to refer the question to the Federal Court for its opinion or whether to decide the question for itself, leaving the parties to appeal to the Federal Court if they so desire.236

' Validity of subordinate legislation An equally difficult problem is whether the AAT has the power, for the purpose of

discharging its review functions, to decide questions as to the validity of subordinate legislation. The only case, to the writer's knowledge, in which the issue has directly arisen for decision by the Tribunal is Re Jonsson and Marine Council (No 2).237

Mr Jonsson was an experienced seaman, with an otherwise unblemished record, who had pleaded guilty to assaulting the chief steward of his ship. Subsequently, the Marine Council, purporting to act under s 47(1) of the Navigation Act 1912 (Cth), determined that his conduct was such that he was unsuitable for engagement as a seaman. Mr Jonsson applied to the AAT for review of this decision.

In such cases, s 47(1) clearly conferred a discretion on the Marine Council, which was to be exercised, "in accordance with prescribed principles" (s 47(3)). What purported to be the "prescribed" principles238 were set out in reg 9 of the Navigation (Marine Council and Committee of Advice) Regulations. Regulation 9(1)(a) provided that "where it is established that a person ... (i) has inflicted violence causing actual bodily harm on another person ... the person is to be taken to be unsuitable for engagement as a seaman" (emphasis added).

The Tribunal was satisfied that the applicant's conduct fell within this description. It also concluded, however, that, rather than prescribing "principles" to guide the Council's discretion, reg 9(1)(a) sought to impose prescriptive directions as to how the discretion was to be exercised and that it was, consequently, ultra vires the regulationmaking power conferred by the Act.

The Tribunal rejected the option of referring the question to the Federal Court, because it did not consider the issue to be of such importance as to justify that course, and because of its concern over the effect of possible delays on the applicant's ability to work.239 Acting on its view that reg 9(1)(a) was invalid, the Tribunal set aside the Council's decision, thus restoring Mr Jonsson's suitability for engagement as a seaman.

There can be no doubt that the question as to the validity of reg 9(1)(a) necessarily arose for determination in Jonsson. The regulation, on the face of it, frustrated the

235

236

237

238 239

Re R M and Commissioner for Superannuation (1984) 6 ALD 272 at 285-288; affirmed on appeal by the Federal Court, sub nom McMullan v Commissioner for Superannuation (1986) 61 ALR 189; cf Re Nelson and Secretary Department of Social Security (1986) 10 ALD 408; Re Zimmax Trading Pty Ltd and Collector of Customs (1979) 2 ALD 120 at 125-126; cf Re McKie (1988) 8 AAR 80 at 96-99. Re R M (1985) 6 ALD 272 at 286-287; cf Brian Lawlor Automotive (1979) 2 ALD 1 at 7 per BowenCJ. (1990) 12 AAR 323; cf Re Zimmax Trading Pty Ltd (1979) 2 ALD 120 at 125-126; Re Costello and Department of Transport (1979) 2 ALD 934 at 937-939; but see also Re Tomago Aluminium Co Pty Ltd and Collector of Customs (1988) 17 ALD 583. Sees 17(q) of the Acts Interpretation Act 1901 (Cth). (1990) 12 AAR 323 at 335-341. .


proper discharge of the Tribunal's function by purporting to preclude the exercise of any discretion in the circumstances of the applicant's case. A Tribunal seeking to conform to the expressed will of Parliament, and to inform itself as to the proper ambit of the discretion conferred by s 47(1) of the Act, could not avoid facing up to the apparent inconsistency between the Act and the regulations.240 As with other legal questions which necessarily arise in the course of discharging its statutory function, it would seem, on principle, that this was an issue on which the AAT was competent to form an opinion.241

Strong support for that conclusion may be drawn from the decision of the High Court in The Queen v Toohey; ex parte Northern Land Council.242 In that case, the question arose before Toohey J, sitting as the Aboriginal Land Commissioner under the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth), as to whether reg 5 of the Planning Regulations made by the Administrator of the Northern Territory under the Planning Act 1979 (NT) was invalid. It was argued that the regulation was made for an improper purpose, namely to defeat a claim to traditional lands on the Cox Peninsula made by the Northern Land Council on behalf of certain Aborigines. Regulation 5 had purported to provide that the land on the Cox Peninsula was land in a "town". If the regulation was valid, the land was excluded from the land to which a claim could be made under the Land Rights Act. The question of validity was therefore central to the administrative function to be discharged by the Commissioner under s 50(1)(a) of the Act.

The Commissioner refused to entertain the challenge on the ground that the purpose which activated the Administrator, as the Crown's representative, in making the regulation could not be examined. The High Court, however, held by a majority (Gibbs CJ, Stephen, Mason, Aickin and Wilson JJ; Murphy J dissenting) that the Commissioner was in error in so deciding and remitted the matter to him for determination in accordance with law.243

Accepting that the AAT has the power to decide a question such as arose in Jonsson, it is still a nice question whether it should decide the point itself, rather than refer the question to the Federal Court. It is plainly an important consideration that only a court exercising the judicial power of the Commonwealth can give an authoritative answer to the question244 and that an expression of an opinion by the Tribunal that regulations are invalid, whilst lacking the authority of a judicial decision, carries potentially serious implications for those charged with the administration of the legislation.

In Jonsson, for example, the Tribunal appears to have decided the case on the premise that, if reg 9(1)(a) was invalid, the discretion conferred by s 47(1) of the Act could be exercised, untrammelled by any relevant "principles". It may be, however, that the invalidity of paragraph (a) of reg 9 would invalidate the entire regulation245 and that, having regard to the mandatory terms of reg 47(3) of the Act, the discretion

240 241 242 243

244 245

Cf Re R M (1985) 6 ALD 272 at 285-288. Cf Re Ranger Uranium Mines Pty Ltd (1987) 163 CLR 656 at 663-666. (1981) 151 CLR 170. Ibid at 193 per Gibbs CJ; at 215-216 per Stephen J; at 217 per Mason J; at 267-269 per Aickin J; at 284 per Wilson J. SeeD Pearce, Delegated Legislation in Australia and New Zealand (1977) at 92. Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 371 per Dixon J; cf D Pearce, above n 244 at 282-285.

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conferred b~ s 47(1) was incapable of being exercised at all if there were no "prescribed principles". 46 These were important issues which needed to be resolved.

Any prejudice to the applicant, by reason of delay through referring the matter to the Federal Court, could be met by a stay order under s 41 of the AAT Act and, given the importance of the issue, it may be that a:ri. application for legal aid under s 69 of that Act may be appropriate in such a case.

However, these are issues for the Tribunal to decide in the exercise of its discretion under s 45 of the AAT Act. It must not be forgotten that, if the Tribunal does proceed to decide the question for itself, its opinion (and its comretence to decide the question) may be tested by way of appeal to the Federal Court.24

Jonsson needs to be contrasted with Re Tomago Aluminium Co Pty Ltd and Collector of Customs248 where the Tribunal, apparently of its own motion, purported to decide that reg 126(e) of the Customs Regulations, which provides for refund or remission of duty where duty has been paid "through manifest error of fact or patent misconception of law", was ultra vires the regulation-making power conferred by the Customs Act 1901 (Cth). Despite this opinion, the Tribunal nevertheless proceeded to decide the case on the assumption that the regulation was valid. 249

It is unnecessary to refer to the reasons given for the fairly summary dismissal of reg 126(e), except to say that, to the extent that they depended (as the headnote indicates) upon the view that reg 126 does not deal with the making of refunds with respect to "goods or classes of goods" as required by s 163 of the Customs Act 1901 (Cth), the reasons are not, in the writer's view, persuasive. The regulation, on the face of it, prescribes circumstances in which a refund or remission of duty may be made. The fact that the regulation was unqualified as to the class or classes of goods to which it was to apply, indicates a clear intention, one might have thought, that it was to apply to goods generally.

But be that as it may, why was it necessary for the Tribunal itself to raise the question? Its function was to review a decision made under reg 128B of the Customs Regulations refusing an application for a refund in accordance with reg 126(e). In contrast to Jonsson, the Tribunal was not seeking to construe the regulations to enable it to discharge the function of administrative review committed to it by Parliament. Rather, the Tribunal was purporting to decide a question of law anterior to the existence of its review jurisdiction.250 In the writer's view, for the reasons earlier given in relation to questions of constitutional validity, this is not a function which, on the proper construction of the AAT Act, Parliament intended to confer on the Tribunal.

246 247

248 249

250

Browne v Commissioner for Railways (1936) 36 SR (NSW) 21. It appears that no appeal was lodged by the respondent in Jonsson; but neither has there been any amendment of the regulations up to the end of May 1994. This tends to leave the issue in an unsatisfactory state and suggests that it may have been preferable for the Tribunal to have referred the question to the Federal Court for decision. (1988) 17 ALD 583. It should be noted that the Tribunal was also of the opinion that it lacked jurisdiction to review refund decisions. In this it was mistaken; see para 13(a) in Sch 1 to the AAT Act (since repealed); see now s 273GA of the Customs Act 1901 (Cth). See, in this regard, the earlier analysis of Re Adams (1979) 1 ALD 251 andRe McKie (1988) 8 AAR 80; cf Brian Lawlor (1979) 2 ALD 1 at 31-per Deane J.

I


Questions of law- summary In short, the principle which, in the writer's view, emerges by analogy from decisions such as Re Cram and Re Ranger Uranium Mines Pty Ltd, is that it is constitutionally competent for the AAT to form an opinion on (or "decide") a question of law, notwithstanding that the question may, on the face of it, be a question of a kind falling within the exclusive ambit of judicial power, provided that to do so is a necessary step in the discharge of its allotted administrative function. Once the Tribunal steps outside that administrative function, its decision is denied the constitutional support which the AAT Act draws from Chapter II of the Constitution and may be exposed as an attempted usurpation of the judicial power of the Commonwealth.251

APPEALS TO THE FEDERAL COURT ON QUESTIONS OF LAW

Whilst the AAT may have the power to "decide" questions of law that necessarily arise, it lacks the power to decide such questions conclusively.252 The supervisory jurisdiction exercised by the Federal Court pursuant to s 44 of the AAT Act is, in the writer's view, fundamental to the constitutionality of the AAT. The existence of the right of appeal to the Federal Court in its original jurisdiction on questions of law serves to confirm the non-judicial status of the Tribunal.253 It upholds the authority of the Federal Court, in the exercise of the judicial power of the Commonwealth, to control any substantive or procedural error of law in the exercise of the AA T's administrative functions. The validity of s 44 of the AAT Act has, however, come into question in its application to appeals in deportation and taxation cases.

In deportation cases, the problem is that the powers of the AAT are limited to affirming the decision of the Minister or remitting the matter for reconsideration in accordance with any recommendations of the Tribunal. Concerns as to the validity of s 44 in this context had arisen following the withdrawal by the High Court of the special leave to appeal granted to the Minister in Minister for Immigration and Ethnic Affairs v Pochi on the ground (inter alia) that the Court "should not be placed in a position where the substance of a decision which it has affirmed can be overridden by ministerial fiat and the reasons for its judgment may be treated by the Minister as no more than advice which he is at liberty to disregard".254

In Minister for Immigration and Ethnics Affairs v Gungor,255 however, the Federal Court was satisfied that the discretionary grounds relied on by the High Court for refusing to continue with the hearing in Pochi did not mean that the Federal Court was acting unconstitutionally in hearing appeals on questions of law in deportation matters. The order of the Court, Fox J said, "is final, subject only to appeal, and has legal consequences".256 Justice Sheppard rejected the submission that the Court was "acting

251 252 253

254 255 256

Cf Re Cram (1987) 163 CLR 140. Cf Rola Co (1945) 69 CLR 185 at 212 per Starke J; at 218 per Williams J. Cf Hegarty (1981) 36 ALR 275 at 280; Shell Co (1930) 44 CLR 530 at 544; Munro (1926) 38 CLR 153 at 176; see also L Zines, above n 13 at 166. For the position in America, see Atlas Roofing Co 430 US 442 at 455, n 13 (1977). (1981) 36 ALR 561 at 565. (1982) 42 ALR 209. Ibid at 212.


administratively" or "merely giving an advisory opinion"257 when determining such an appeal. The Court had no power to deal with the merits.258 The parties were entitled to have their review conducted by the Tribunal in accordance with law. Whilst the exercise by the Court of its supervisory role "may not necessarily have any conclusive effect on the question of deportation", nevertheless its ruling on the question of law is "bindinf on the parties and also on the Tribunal in the conduct of its further review if any".25 This is a judicial function appropriate to the exercise of the judicial power of the Commonwealth. Justice Fisher agreed.

A more troublesome question, however, is that posed by Gummow J in TNT Skypak260 as to whether, in its application to taxation matters, s 44 of the AAT Act is invalid because it denies to the Federal Court the power, on an appeal from a decision of the AAT, to determine the whole of the matter, or the controversy, between the taxpayer and the Commissioner.

In essence, the concern expressed by his Honour was that s 44 is narrower than the formers 196 of the Income Tax Assessment Act 1936 (Cth) which allowed an appeal to a Chapter III court from a decision of the former Taxation Board of Review which "involved" a question of law. Provided such a question was involved, the whole of the controversy (including questions of fact) came before the Court for review. By contrast, under s 44, the existence of a question of law is now "not merely a qualifying condition to ground the appeal, but also the subject matter of the appeal itsel£".261

An administrative assessment to taxation cannot be made "absolutely conclusive" upon a taxpayer if no recourse to the judicial power is allowed.262 Section 44, his Honour said, is ambulatory in operation and seeks to invest the Federal Court with jurisdiction in matters "arising under a miscellany of federal laws", including matters with respect to disputed taxation assessments. To confer jurisdiction with respect to "matters", in the constitutional sense, means conferring "jurisdiction to quell the controversy between the parties".263 Where, after an AAT hearing in a taxation matter, the parties are still in dispute as to both facts and law, his Honour was concerned that s 44 may unconstitutionally limit the jurisdiction of the Federal Court to "less than the whole of the matter arising under federallaw".264

There are, I suggest, a number of possible answers to the doubts expressed by Gummow J. In respect of matters falling within the exclusive ambit of the primary aspect of judicial power, it is, of course, indisputable that "the unique and essential function of the judicial power is the quelling of controversies by ascertainment of the facts, by a:R~lication of the law and by exercise, where appropriate of judicial discretion". 6 This is the power traditionally exercised by the courts in determining

257 258 259 260

261 262

263 264 265

Ibid at 220. Ibid at 221. Ibid at 222. (1988) 82 ALR 175 at 178-82; and see J H Momsen, "Appeals from the Australian Administrative Appeals Tribunal to the Federal Court - Is There a 'Matter' Involved?" Aust Fed Tax Reporter Volll at 883,058-62. ' Federal Commissioner of Taxation v Brixius (1987) 87 ATC 4963 at 4967. Federal Commissioner of Taxation v Brown (1958) 100 CLR 32 at 40 per Dixon CJ; see also at 52 per Williams J; see also MtlcCormick (1984) 158 CLR 622 at 639-643, 646 and 658. Fencott v Muller (1983) 152 CLR 570 at 608. TNT Skypak (1988) 82 ALR 175 at 181. Fencott v Muller (1983) 152 CLR 570 at 608.


private law controversies with respect to "basic" rights.266 However, we are not here concerned with basic rights in that traditional sense.

For the purposes of Chapter III of the Constitution, as we have seen, a "matter" must also be taken to include "matters" in which the public law aspect of judicial power is invoked in order to confine administrative bodies within the proper limits of their authority.267 The jurisdiction of the courts in such matters does not extend to reviewing findings of fact as such, nor to deciding the merits of the case.268 The question is, in essence, whether the administrative decision under challenge is tainted by material error of law. In such a matter the Court usually has less than the whole of the controversy between the parties before it. Indeed, the inability of the courts, in the majority of such cases, to "quell the controversy between the parties" was one of the principal reasons behind the establishment of the AAT.269

In the generality of cases, therefore, it cannot be an objection to the validity of s 44 that the "matter" in respect of which the Federal Court is invested with "appellate" jurisdiction is a "matter" of the more limited nature that arises in the exercise of the supervisory jurisdiction of the courts. The determination of such a "matter" is entirely appropriate to the exercise of judicial power.270

Is the position any different in taxation appeals? Is Parliament required in such cases, on constitutional grounds, to confer jurisdiction on the Federal Court, by way of appeal, wide enough to enable the Court to review not only questions of law, but also questions of fact, so as to enable it to quell the whole of the controversy between the parties? I suggest not, for two related reasons. Firstly, Parliament has conferred upon every taxpayer a right of direct access to the Federal Court by way of statutory appeal against a decision of the Commissioner of Taxation on a taxpayer's objection to an assessment.271 This enables the taxpayer to have a dispute with the Commissioner resolved by the Court to the fullest extent that the judicial power of the Commonwealth allows.272 It may be argued, therefore, that any constitutional requirement to allow a taxpayer the opportunity to challenge an assessment before the courts is fully satisfied by that provision.273

Secondly, where a taxpayer elects to take his or her objection to the AAT, instead of direct to the Court, it may be argued that he or she must be taken to have accepted administrative review on the terms on which it was offered by Parliament, namely that the Tribunal's decision would only be subject to appeal "on a question of law".

266 267

268 269

270 271 272

273

Quinn (1977) 138 CLR 1 at 11. Sees 75(v) of the Commonwealth Constitution; Rola Co (1945) 69 CLR 185 at 204; Re Tracey (1989) 166 CLR 518 at 580. Bond (1990) 170 CLR 321 at 341 and 357. Commonwealth Administrative Review Committee, Report (August 1971) Parliamentary Paper No 144 of 1971 (The Kerr Report) at ch 3. Gungor (1982) 42 ALR 209 at 212 and 223. Sees 1422 of the Taxation Administration Act 1953 (Cth). See Kolotex Hosiery (Australia) Pty Ltd v Commissioner of Taxation (1975) 132 CLR 535 at 567 as to the limitations in cases involving discretionary powers. See also BOA Pty Ltd v Federal Commissioner of Taxation (1981) 81 ATC 4492. Cf Giris Pty Ltd v Federal Commissioner of Taxation (1969) 119 CLR 365 at 378-379 per Kitto J; MacCormick (1984) 158 CLR 622 at 640-641 per Gibbs CJ, Wilson, Deane and Dawson JJ; and at 658 per Brennan J.


The answer to the doubts raised by his Honour may ultimately depend on whether the constitutional principle against an incontestable tax is perceived to be in any respect threatened by conceding to an administrative tribunal the power of finally deciding disputed questions of fact in taxation cases. However, given the taxpayer's alternative right of direct access to the courts by way of statutory appeal, it is the writer's respectful view that the doubts expressed by Gummow J are not well-founded.

STATUTORY APPEAUADMINISTRATIVE REVIEW CONTRASTED

Given that the same public law function of review can be conferred by Parliament on a Chapter III court or an administrative tribunal, it only remains to consider in what respects the function of a court, exercising judicial power by way of statutory appeal, differs from that of an administrative tribunal exercising executive power by way of review. As noted at the outset, however, it must always be borne in mind that limitations inherent in the nature of judicial power itself restrict the types of matters which may constitutionally be committed to a Chapter III court for decision by way of statutory appeal to those raising justiciable issues.274

Where the administrative power is precisely defined as, for example, in most taxation, customs and employees' compensation matters, the legal issues which have to be decided, whether by a court on statutory appeal or by an administrative tribunal, such as the AAT, are identicaL275 The differences lie in the procedural aspects of the hearing,276 the nature of the power brought to bear in deciding the issues, and the consequences flowing from its exercise.

Where discretionary powers are involved, the courts have seen their powers of review by way of statutory appeal as limited to exercising a superviso~, as opposed to a determinative, function over the discretionary aspects of the case.27 This limitation does not apply, of course, to an administrative tribunal, such as the AAT, which is expressly authorised to exercise the powers and discretions of the primary administrator.278 In discretionary cases, therefore, Tribunal review is seen as offering more comprehensive relief than review by way of statutory appeal.

Judicial power, when exercised in the context of a statutory appeal, involves the making of a binding declaration of right in respect of the rights and obligations of the parties arising out of the operation of the law upon past events or conduct.279 In this

274

275

276 277

278

279

Cf Justice F G Brennan, "New Growth in the Law - The Judicial Contribution" (1979) 6 Mon L R 1 at 12-22; E Campbell, "The Choice Between Judicial and Administrative Tribunals and the Separation of Powers" (1981) 12 Fed L R 24 at 24-26. Munro (1926) 38 CLR 153 at 176-177; Bailey v Federal Commissioner of Taxation (1977) 13 ALR 41 at 42 per Barwick CJ; Hegarty (1981) 36 ALR 275 at 284 per Murphy J; cf Brennan J, above n 274 at 12. See ss 33, 35, 39 and 40 AAT Act. Steele (1955) 92 CLR 177 at 187-188; Avon Downs Pty Ltd v Federal Commissioner of Taxation (1949) 78 CLR 353 at 360; Mobil Oil Australia Pty Ltd v Federal Commissioner of Taxation (1963) 113 CLR 475 at 503; Commonwealth of Australia v Anderson (1957) 97 CLR 345 at 353; cf Secretary, Department of Housing and Construction v Wildman (1984) 3 AAR 38 at 43. Sees 43(1) AAT Act; cf Federal Commissioner of Taxation v Brian Hatch Timber Co (Sales) Pty Ltd (1972) 128 CLR 28 at 59 per Owen J; cf Kolotex Hosiery (Australia) Pty Ltd v Commissioner of Taxation (1975) 132 CLR 535 at 567 per Gibbs}. Precision Data Holdings (1991) 173 CLR 167 at 188-189; cf Re Cram (1987) 163 CLR 140 at 148.


sense, the judicial function may be characterised as interpretative of the rights of the parties.280 The "authoritative character, binding consequences and indirectly coercive effect of adjudication by a court"281 characterise the exercise of judicial power.

By contrast, an adjudication by an administrative tribunal such as the former Taxation Boards of Review or the AAT has essentially the same effect, in law, as a decision of the primary decision-maker whose decision is under review.282 The Tribunal is seen as standing in the shoes of the person whose decision is in question and as exercisin~ the powers and discretions of the primary decision-maker afresh according to law. 83

Where the AA T decides to affirm the decision under review, the decision of the primary administrator is left intact. The ~rimary decision is then "the only decision which takes effect under the enactment".2 4 But where the decision is varied, or a new decision substituted, the AAT's decision is deemed to be the decision of the primary administrator and, unless the Tribunal otherwise orders, has effect from the day on which the decision under review had effect.285 The Tribunal, of course, has no greater powers available to it than the primary decision-maker may lawfully exercise.286

The making of an administrative decision is the process of applying an enactment to the facts as found.287 This is the process Isaacs J described in Munro as "the determination of circumstances as the factum for the operation of the legislative will".288 The making of the administrative determination is the act or mechanism by which the legislative will is implemented in the particular case.

It is in the nature of public law rights, privileges and liabilities that they depend for their enlivenment, in the particular case, upon the making of an administrative decision. A "right", "privilege" or "liability" said to arise under a Commonwealth statute, the administration of which is vested in the federal executive, is at best "inchoate or contingent" until such time as the processes of administrative investigation and determination in response to the circumstances of the individual concerned have been completed.289 It is the administrative decision which gives the "inchoate" right, privilege or liability its legal substance. In taxation matters, for example, the statute may prescribe the circumstances in which a liability to taxation is incurred, but the specific liability of the individual is not fixed until an assessment is made.290

Where the duality principle applies, the administrative decision-making function committed to the AAT may be no less interpretative of the rights and liabilities of the

280 281 282 283 284 285 286

287

288 289

290

Silk Bros (1943) 67 CLR 1 and G Sawer, Cases on the Constitution (3rd ed 1964) at 583. Tasmanian Breweries (1970) 123 CLR 361 at 390 per Windeyer J. Cf Bogaards v McMahon (1988) 80 ALR 342 at 349. Pochi (1980) 4 ALD 139 at 143. Re Brian Lawlor (1978) 1 ALD 167 at 175. AA TAct, s 43(6). Re Callaghan and Defence Force Retirement and Death Benefits Authority (1978) 1 ALD 227 at 230. Cf Bailey (1977) 13 ALR 41 at 42 per Barwick CJ; Batagol v Federal Commissioner of Taxation (1962-3) 109 CLR 243 at 252 per Kitto J; Federal Commissioner of Taxation v Daleo (1990) 90 ATC 4088 at 4096-7 per Toohey J. (1926) 38 CLR 153 at 176. Free Lanka Insurance Co Ltd v Ranasinghe [1963] AC 541 at 552; but see L Zines, above n 13 at 158; cf Australian Telecommunications Commission v Novak (1989) 86 ALR 457 at 461. Munro (1926) 38 CLR 153 at 177.


· parties than the )udicial decision-making function exercised by a court by way of statutory appeal. 91 The essential function of the AAT in such cases is to determine whether, on the facts as found and having regard to the expressed legislative will, the individual concerned is entitled to the benefit, or is subject to the burden of, the particular right, privilege or liability. This function differs from that of a court by

,. reason of the fact that the Tribunal determines the matter b~ exercising (where necessary) the powers and discretions of the primary administrator;2 2 its decision has no greater effect in law than that of the primary decision maker; it is not directly enforceable;293 and the Tribunal's decision lacks the authoritative character of a decision given in the exercise of the judicial power of the Commonwealth.294

CONCLUSION

It has long been recognised that judicial power, as a juristic concept, is incapable of "exclusive and exhaustive" definition. The description enunciated by Griffith CJ in Huddart Parker embodies the essence of the common law concept of judicial power. It is founded upon the rich tradition of the common law in upholding the Rule of Law and in protecting and enforcing the basic rights of the individual in society. The function of this primary, or private law, aspect of judicial power is the resolution of controversies over such basic rights, whether they relate to the life, liberty, property or, it may be added, the legal status of the individual,295 by bringing to bear the unique characteristics of judicial power296 in order to quell the controversy between the parties.297 The concept of "basic rights" remains both flexible and dynamic because it is the exclusive preserve of Chapter III courts to determine, as occasion arises, what rights are "basic rights" for the purposes of the judicial power of the Commonwealth.

By elevating this primary aspect of judicial power to "definitional" status, however, what has tended to be obscured, in the writer's respectful view, is that judicial power, in its secondary or public law aspect, presents quite different characteristics. As exercised through the traditional supervisory jurisdiction of the courts, the public law function of judicial power, so far as presently relevant, is to contain excess or abuse of executive power. In marked contrast to the primary aspect of judicial power, the exercise of the supervisory jurisdiction of the court does not normally quell the real controversy between the individual and the executive arm of government; it does not enable the court itself to exercise the statutory power or discretion, the lawful limits or purpose of which it is called upon authoritatively to define.298 As Sir John Donaldson MR observed in Regina v Secretary of State for Social Services; ex parte Wellcome Foundation Ltd,

291

292 293 294 295 296 297 298

U]udicial review of administrative action is a supervisory jurisdiction of an essentially practical nature designed to protect the citizen from breaches by decision-makers of their

Cf L Zines, above n 13 at 152. Administrative decisions made in the exercise of discretionary powers are, by contrast, usually constitutive: Silk Bros (1943) 67 CLR 1. AAT Act, s 43(1); cf Steele (1955) 92 CLR 177 at 187-188. . See Dahlia Mining Co Ltd v Collector of Customs (1989) 90 ALR 193. Cf Tasmanian Breweries (1970) 123 CLR 361 at 390. Davison (1954) 90 CLR 353 at 367-368; Harris v Caladine (1991) 65 ALJR 280 at 289 and 306. Tasmanian Breweries (1970) 123 CLR 361 at 390 per Windeyer J. Fencott v Muller (1983) 152 CLR 570 at 608. Swan Hill Corporation v Bradbury (1937) 56 CLR746 at 757-758 per Dixon J.


public law duties ... [I]f the decision is not affected [by legal error] there is no reason why the jurisdiction should be exercised and every reason why it should not.299

The duality of functions principle, in its application to the function of reviewing administrative decisions on the merits, is the corollary of these primary and secondary aspects of exclusive judicial power. It acknowledges that the resolution of the merits of controversies over public law rights, privileges and liabilities falls outside the primary aspect of exclusive judicial power because the "rights" in question are not "basic rights". They are also outside the secondary aspect of that power because the supervisory jurisdiction of the court in public law matters does not normally extend that far.300 As a consequence, the principle acknowledges the authority of Parliament, subject to relevant constitutional limitations, to determine the appropriate forum in which to have such controversies determined- either by way of statutory appeal to a court (in matters involving justiciable issues) or by way of administrative review to a tribunal, such as the AAT. The function then takes its colour largely from the primary character of the body to which it is entrusted, depending also on how the decision is made binding and how it is enforced.301 Where the function is committed to an administrative tribunal, it matters not that the tribunal is clothed with the trappings of curial decision-making in order, the more effectively, to discharge its allotted task.

In the absence of material error of law, findings of fact made by the AAT are conclusive. To concede such a power to the Tribunal derogates in no respect from the judicial power of the Commonwealth, because the function of conclusive fact-finding is not exclusively judicial. On the other hand, whilst it is constitutionally permissible for the AAT to form an opinion on- or to "decide"- a question of law that is necessary to be determined so that it may properly discharge its function of administrative review according to law, no "decision" of the Tribunal on any such question can be conclusive.

In matters falling within the duality principle, the resolution of the controversy will usually require an adjudication, either by a court or by an administrative tribunal,302 as to whether, on the facts as found and having regard to the expressed legislative will, the individual concerned is entitled to the benefit, or is subject to the burden of, the particular right, privilege or liability. It is, I suggest, precisely because this function is analogous to the function lying at the heart of the primary aspect of judicial power, that it is appropriate to the exercise of judicial power by way of statutory appeal. But it is not, for that reason alone, exclusively or necessarily judicial.

What serves to differentiate the function, when exercised by a court as opposed to a tribunal, is the nature of the power brought to bear in the resolution of the dispute, the procedural aspects of the hearing, and the consequences flowing from the exercise of

299

300 301 302

(1987) 1 WLR 1166 at 1175; cited with approval by the Full Court of the Federal Court in Australian Trade Commission v WA Meat Exports Pty Ltd (1987) 75 ALR 287 at 292. Bond (1990) CLR 321 at 356. Munro (1926) 38 CLR 153 at 177. "Adjudication" is not seen, in this country, as exclusively a function of judicial power: the Wheat case (1915) 20 CLR 50 at 64 per Griffith CJ; at 83-87 per Isaacs J; and at 106-107 per Powers J; cf Hegarty (1981) 36 ALR 275 at 284 per Murphy J; Tasmanian Breweries (1970) 123 CLR 361 at 371 per McTiernan J. In the writer's respectful view, the decision to the contrary in Midland Metals Overseas Ltd v Comptroller-General of Customs (1991) 39 FCR 87 at 97, involves a misunderstanding of the decision-making processes of the AAT.


the power.303 So far as the AAT is concerned, the essentially administrative nature of its functions, and thus its constitutionality, is maintained by ensuring (i) that its determinative powers are drawn from, and do not exceed, those of the primary decision-maker; (ii) that, on all questions of law, its decisions, like those of the primary decision-maker, are subject to judicial review; and (iii) that the Tribunal has no power to enforce its own decisions.

The establishment of the AA T, together with the enactment of the ADJR Act, has been the catalyst for a fundamental change in the administration of public law functions in this country. There has emerged ,a clearer perception of the parallels between, and the distinguishing characteristics of, executive and judicial power. There are now comprehensive statutory requirements as to the giving of reasons for decisions, as to setting out findings of fact and referring to the evidence or other materials on which those findings are based. In addition, administrative decisions are exposed to external review before the AAT or to judicial review before the Federal Court (or both). These developments have led to an unprecedented openness in the federal administrative decision-making process and, some critics may say, to an increasing judicialisation of that process - at least at senior administrative levels. But, in the writer's view, the precepts of administrative justice embraced by Federal Parliament admit of no other consequence.

Perhaps more importantly, there has emerged a unique opportunity for detailed analysis of the principles and procedures to be applied in the administration of diverse areas of public law to which, in the first 75 years after Federation, the judicial power of the Commonwealth only rarely extended. Tribunal decisions have filled many of the blank spaces in public law. In many of its jurisdictions, of course, the AAT is performing purely administrative functions not appropriate to the exercise of judicial power. But experience has shown that even in matters falling within the duality principle, there are many cases (particularly in respect of veterans' and social welfare pensions, public service retirement benefits and the like) which are probably better dealt with by way of administrative review than by bringing to bear the full weight of the judicial power of the Commonwealth. The experience of two-tier administrative review in busy jurisdictions like veterans' affairs and social security has shown that many disputes over such rights are capable of being settled in an informal nonadversarial context, which the judicial system may find much more difficult to provide.

The decision by Parliament to commit the review of decisions made in the exercise of statutory powers and discretions primarily to the AAT, rather than to apportion such functions between Chapter III courts and the Tribunal according to whether or not the particular function is appropriate to the exercise of judicial power, was, in the writer's view, correct. The integrity and authority of the judicial power of the Commonwealth is not thereby impaired, because the Tribunal is subject to the supervisory jurisdiction of the Federal Court and, ultimately, the High Court.

However one analyses the constitutional status of the AAT, the hybrid nature of its function inevitably leaves lingering conceptual doubts as to the Tribunal's,proper place within the separation of powers doctrine, as that doctrine is applied to the Australian Constitution. Despite its many court-like characteristics, in particular, its powers of adjudication in relation to public law controversies, it is clear, in the writer's view, that the Tribunal is exercising Chapter II executive power, not Chapter III judicial power.

303 Cf Munro (1926) 38 CLR 153 at 177.


On the other hand, for an adrrUnistrative tribunal to have determinative powers drawn from, yet independent of, the executive arm of government does not fit comfortably with Chapter II of the Constitution and the doctrine of Ministerial responsibility, whatever it may be in this country.304 Similar concerns have emerged in the United States as to the place of administrative review agencies under the separation of powers doctrine as embodied in the American Constitution. 305

To the extent that the doubts with resfect to the AAT are based on the. breadth of its powers to review ministerial policy,30 it is the writer's respectful view that the decision of Brennan J in Re Drake and Minister for Immigration and Ethnic Affairs (No 2)307 provides an acceptable constitutional accommodation of the administrative review function of the Tribunal with the ultimate political responsibility of the Minister in such cases. It may be, however, that the constitutional validity of a tribunal such as the AAT rests less upon "juristic analysis" and more upon our inherited legal traditions with respect to the role of tribunals in the administration of government, coupled with a pragmatic recognition of the realities of the modem welfare state.308 There have been many examples of federal administrative tribunals since Federation.309 To deny Parliament the power to create tribunals such as the AAT and to require, instead, that all public law controversies involving justiciable issues be determined exclusively by Chapter ill courts would risk subjecting an already overburdened judicial system to intolerable strains, and would place even greater financial and psychological barriers than presently exist between the individual and the achievement of administrative justice. It is the writer's view, therefore, that so long as the Tribunal maintains its focus on the administrative character of its powers and functions, its constitutionality is not in doubt.

304

305

306 307 308

309

See, E Willheim, "Commentary" (1981) 12 Fed L R 62; cf J Goldring, "Responsible Government and the Administrative Appeals Tribunal" (1982) 13 Fed L R 90. See, for example, P L Strauss, "The Place of Agencies in Government: Separation of Powers and the Fourth Branch" (1984) 84 Col L R 573. Drake (1979) 2 ALD 60 at 70 and 77. (1979) 2 ALD 634. Cf Victorian Stevedoring and General Contracting Co Pty Ltd v Dignan (1931) 46 CLR 73 at 101-102; cf B Schwartz, above n 131 at 59; K C Davis, above n 131, Vol1 at 184-185. See the Kerr Report, above n 269 at ch 2; cf Munro (1926) 38 CLR 153 at 200 per Higgins J.

POWER, THE DUALITY OF FUNCTIONS AND … · ... on the former Taxation , of Review, ... as are invested with federal jurisdiction pursuant to that Chapter.13 ... appeals to the Federal

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