FEDERAL COURT OF AUSTRALIA
Australian Securities and Investments Commission v Administrative Appeals Tribunal [2009] FCAFC 185
ADMINISTRATIVE LAW – power of the Administrative Appeals Tribunal under s 41(2) Administrative Appeals Tribunal Act 1975 (Cth) to order a stay or otherwise affect the operation or implementation of a decision and under s 35 to make confidentiality orders – where the decision is a banning order under s 920A of the Corporations Act 2001 (Cth) – where the effect of the decision is to trigger publication obligations of the Australian Securities and Investments Commission – where stay and confidentiality orders by the Administrative Appeals Tribunal prevent the Australian Securities and Investments Commission from satisfying those obligations – whether Administrative Appeals Tribunal exceeded its power
Held: application dismissed
Administrative Appeals Tribunal Act 1975 (Cth), ss 3(3), 25, 35, 41, 43
Australian Securities and Investments Commission Act 2001 (Cth), s 1(2)
Corporations Act 2001 (Cth), ss 9, 776A(1), 915B, 920A, 920B, 920C, 920D, 920E, 920F, 922A, 1299K, 1311(1), 1317A, 1317B, 1317D
Federal Court of Australia Act 1976 (Cth), s 20(1A)
Judiciary Act 1903 (Cth), s 39B
Law and Justice Legislation Amendment Act (No 1) 1995 (Cth)
Corporations Regulations 2001 (Cth), reg 7.6.06
Allied Asia Holdings (Aust) Pty Ltd v Australian Securities and Investments Commission [2002] FCA 566 distinguished
AMP Capital Investors Limited v Transport Infrastructure Development Corporation [2008] NSWCA 325 cited
Australian Securities and Investments Commission v PTLZ (2008) 48 AAR 559; [2008] FCAFC 164 referred to
Bushell v Repatriation Commission (1992) 175 CLR 408 cited
CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 referred to
Collins v Minister for Immigration and Ethnic Affairs (No 2) (1982) 5 ALD 32 referred to
Duncan v Companies Auditors Liquidators Disciplinary Board (2006) 155 FCR 572; [2006] FCA 1747 discussed
Federated Seamen' s Union of Australasia v Commonwealth Steamship Owners’ Association (1922) 30 CLR 144 referred to
Grassby v The Queen (1989) 168 CLR 1 referred to
Ibrahim v Minister for Immigration and Citizenship [2009] FCA 1328 referred to
John Fairfax Publications Pty Ltd v Ryde Local Court (2005) 62 NSWLR 512; [2005] NSWCA 101 referred to
Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597; [2002] HCA 11 applied
Project Blue Sky v Australian Broadcasting Authority (1998) 194 CLR 355; [1998] HCA 28 cited
R v Connell; Ex parte The Hetton Bellbird Collieries Limited (1944) 69 CLR 407 cited
R v Gallagher; ex parte Commonwealth Steamship Owners Association (1968) 121 CLR 330 referred to
Re Cape York Airlines Pty Ltd and Civil Aviation Safety Authority (2004) 80 ALD 364; [2004] AATA 682 referred to
Re Graeber and Australian Prudential Regulatory Authority (2007) 46 AAR 115; [2007] AATA 1966 not followed
Re Pochi and Minister for Immigration and Ethnic Affairs (1979) 36 FLR 482 cited
Re PTLZ and Australian Securities and Investments Commission (2008) 100 ALD 648; [2008] AATA 106 not followed
Re Quinlivan and Australian Securities and Investments Commission (2008) 106 ALD 438; [2008] AATA 1094 referred to
Shi v Migration Agents Registration Authority (2008) 235 CLR 286; [2008] HCA 31 referred to
Shi v Migration Institute of Australia Ltd (2003) 134 FCR 326; [2003] FCA 1304 referred to
Sydney Water Corporation v Caruso [2009] NSWCA 391 cited
The Queen v Hunt; Ex parte Sean Investments Pty Ltd (1979) 180 CLR 322 referred to
VBJ and Australian Prudential Regulation Authority (2005) 60 ATR 1013; [2005] AATA 642 referred to
Vinton Smith Dougall Ltd v Australian Securities Commission (1997) 23 ACSR 567 referred to
XQZT and Australian Securities and Investments Commission [2009] AATA 669 discussed
Yolbir v Administrative Appeals Tribunal (1994) 48 FCR 246 referred to
D C Pearce and R S Geddes. Statutory Interpretation in Australia. 6th ed. LexisNexis Butterworths (2006)
AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION v ADMINISTRATIVE APPEALS TRIBUNAL and XQZT
NSD 1067 of 2009
MOORE, DOWNES AND JAGOT JJ
23 december 2009
SYDNEY
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IN THE FEDERAL COURT OF AUSTRALIA |
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NEW SOUTH WALES DISTRICT REGISTRY |
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General Division |
NSD 1067 of 2009 |
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AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION Applicant
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AND: |
ADMINISTRATIVE APPEALS TRIBUNAL First Respondent
XQZT Second Respondent
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JUDGES: |
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DATE OF ORDER: |
23 DECEMBER 2009 |
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WHERE MADE: |
SYDNEY |
THE COURT ORDERS THAT:
1. The application filed on 24 September 2009 and amended on 14 October 2009 be dismissed.
2. The applicant pay the second respondent’s costs of the application as agreed or taxed.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using Federal Law Search on the Court’s website.
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IN THE FEDERAL COURT OF AUSTRALIA |
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NEW SOUTH WALES DISTRICT REGISTRY |
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General Division |
NSD 1067 of 2009 |
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BETWEEN: |
AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION Applicant
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AND: |
ADMINISTRATIVE APPEALS TRIBUNAL First Respondent
XQZT Second Respondent
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JUDGES: |
MOORE, DOWNES AND JAGOT JJ |
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DATE: |
23 DECEMBER 2009 |
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PLACE: |
SYDNEY |
REASONS FOR JUDGMENT
MOORE J:
1 I have had the benefit of reading the reasons of judgment of Downes and Jagot JJ in a draft form. I gratefully adopt their Honours' account of the background and relevant legislative provisions (as well as the acronyms they have used). Subject to what follows, I generally agree with their Honours' reasons and, in particular, I agree with their observations at [51] to [55] concerning the failure of the Tribunal to pay sufficient regard to the bias in the statutory scheme in the Corporations Act favouring timely disclosure of the identity of a person who is the subject of a banning order and also the observations at [74] to [76] concerning the significance of s 35(1) of the AAT Act.
2 The central issue in these proceedings is whether s 41(2) of the AAT Act conferred power on the AAT to make the orders challenged in these proceedings. That in turn requires consideration of the scope of the power conferred by that subsection and, in particular, what the expression "staying or otherwise affecting the operation or implementation of the decision" means.
3 Several things are clear from the statutory scheme in the Corporations Act concerning banning orders. The first is that once a banning order is made the task of the decision maker, in relation to the direct legal consequences on the person affected by the order, is complete. That is because the Corporations Act establishes the consequences. The second is that the Corporations Act imposes a duty on ASIC to publish a notice in the Gazette and (in conjunction with the Corporations Regulations) to include details of the banning order in the register. It is in this context that the powers of the AAT must be considered. The question then becomes whether the AAT has power to prevent ASIC from performing those duties.
4 Generally the repository of a power conferred by Commonwealth statute cannot, in the absence of an express or implied statutory authority to do so, exercise the power so as to modify or limit the operation of another Commonwealth statute: Federated Seamen' s Union of Australasia v Commonwealth Steamship Owners’ Association (1922) 30 CLR 144 and R v Gallagher; ex parte Commonwealth Steamship Owners Association (1968) 121 CLR 330. In the present case the orders made by the AAT under the AAT Act prevented ASIC from doing what the Corporations Act directed that it do (publish a notice and enter the details on the register). Does s 41(2) authorise this?
5 In my opinion, the answer is yes. The AAT Act concerns the review of decisions made under, amongst other things, legislation of the Commonwealth Parliament: see the definition of "enactment" in ss 3 and 25 of the AAT Act. The operation of a decision (as that expression is used in s 41 of the AAT Act) appears to me to concern the legal consequences of the decision flowing from the operation of the enactment which authorised it or from some other enactment. The authorising enactment (or perhaps some other enactment) may identify consequential or ancillary acts or events which have to be taken or arise after the decision is made. As a matter of ordinary English in the context in which s 41 occurs, the expression "the operation ...... of the decision" seems to me to comprehend those consequential ancillary acts or events. The expression evokes notions of what the decision itself achieves directly. On this construction of the expression, the AAT is clearly authorised to prevent those acts being undertaken or events occurring or modifying how they are undertaken or the way in which they occur. The context, in its broadest sense (see CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408) is a legislative scheme which permits the AAT to review decisions on their merits made under enactments and make a decision in substitution of that of the primary decision maker, operative (unless the AAT otherwise orders) from the time of the original decision: s 43(6), which may involve setting aside the original decision (see s 43(1)(c)). If the decision of the primary decision maker enlivens statutory provisions creating consequences of the type I have been discussing, it would be an entirely natural and obvious part of the statutory scheme for the AAT to have power to modify or prevent those consequences in circumstances where the decision of the primary decision maker might later be set aside.
6 In the present case, a consequence of making a banning order is enlivening the duty to publish the notice and the duty to make the entry in the register. For the reasons I have just given, the AAT had power to make an order preventing the operation of the decision by preventing, for the time being, the performance of these duties.
7 It is, in relation to the notice and the register, unnecessary to consider whether the power to make the order also flowed from the expression "[the] implementation of the decision" in s 41(2). However, for completeness, I should indicate that I doubt this is so. The meaning of the word "implementation" is not simply to be derived, as Emmett J suggested in Duncan v Companies Auditors Liquidators Disciplinary Board (2006) 155 FCR 572 at [11], from the ordinary meaning of the word revealed by dictionaries. That is because, in my opinion, the word is intended to pick up the corresponding expression in the preceding subsection which provides:
(1) Subject to this section, the making of an application to the Tribunal for a review of a decision does not affect the operation of the decision or prevent the taking of action to implement the decision. (Emphasis added)
While the defined meanings referred to by his Honour are probably, in substance, no different from the expression "the taking of action to implement the decision", it is nonetheless that expression which identifies the subject matter of the power conferred by subsection (2). In the present case, as I noted earlier, it is unnecessary for a decision maker who makes a banning order to do anything to implement the decision. No action needs to be taken. It is the Corporations Act which establishes legal consequences of the decision and, in that way, implements it. The decision is, in this sense, self executing.
8 If the view I take is correct about the meaning of the "operation" and the "implementation" of the decision then it does not seem to me that the AAT has power to make the order concerning the media release. While the powers of the AAT to preserve the status quo ante should obviously not be read narrowly, I do not see how an act of a general administrative character (issuing a media release) concerns either the operation or implementation of the decision to make the banning order. Ultimately, the role of the AAT is a limited statutory one and is to review administrative decisions on their merits. It is not a court and the language used to confer the power in s 41(2) is not, in my opinion, language sufficiently flexible to enable any order to be made about the media release.
9 I would make orders quashing that part of the orders of the AAT prohibiting the media release but otherwise dismiss the application with costs.
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I certify that the preceding nine (9) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Moore. |
Associate:
Dated: 23 December 2009
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IN THE FEDERAL COURT OF AUSTRALIA |
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NEW SOUTH WALES DISTRICT REGISTRY |
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General Division |
NSD 1067 of 2009 |
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BETWEEN: |
AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION Applicant
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AND: |
ADMINISTRATIVE APPEALS TRIBUNAL First Respondent
XQZT Second Respondent
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JUDGES: |
MOORE, DOWNES AND JAGOT JJ |
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DATE: |
23 DECEMBER 2009 |
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PLACE: |
SYDNEY |
REASONS FOR JUDGMENT
Downes and Jagot JJ:
BACKGROUND
10 This proceeding concerns the interaction of the provisions of two statutes of the Commonwealth Parliament.
11 By s 41(2) of the Administrative Appeals Tribunal Act 1975 (Cth) (the AAT Act) the Administrative Appeals Tribunal (the AAT) may make an order “staying or otherwise affecting the operation or implementation of the decision to which the relevant proceeding relates… for the purpose of securing the effectiveness of the hearing and determination of the application for review”. By s 35 of the AAT Act the AAT may make certain orders with respect to confidentiality.
12 By s 920A of the Corporations Act 2001 (Cth) the Australian Securities and Investments Commission (ASIC) may make a banning order prohibiting a person from providing financial services. If ASIC makes a banning order, s 920E(2) of the Corporations Act requires ASIC to publish a notice in the Commonwealth Government Gazette as soon as practicable thereafter. By s 922A of the Corporations Act and reg 7.6.06 of the Corporations Regulations 2001 (Cth) ASIC must also maintain a register relating to financial services which includes certain information about banning orders.
13 In the present case ASIC made a banning order against the second respondent. Before ASIC had published notice of the making of the banning order and made the required entries in its register, the second respondent applied to the AAT for review of ASIC’s decision. The second respondent also applied for interlocutory orders under ss 41(2) and 35 of the AAT Act staying the operation and implementation of the banning order. On 4 September 2009 the AAT (DP Handley) published reasons for its decision on the second respondent’s interlocutory application (XQZT and Australian Securities and Investments Commission [2009] AATA 669) and made orders and directions as follows:
1 Pursuant to s 41(2) of the Administrative Appeals Tribunal Act 1975 (Cth), the Tribunal stays the operation and implementation of the decision under review, including entry of the decision in any register maintained by the respondent, publication of the decision in the Gazette, and disclosure of the decision in any media releases issued by the respondent; and
2 Pursuant to s 35(2) of the Administrative Appeals Tribunal Act 1975 (Cth), pending the ultimate determination of the substantive application or any further order of the Tribunal, that:
(a) XQZT be described by a pseudonym for the purpose of protecting his identity; and
(b) the hearing shall take place in private and that only the parties and their representatives and witnesses, the Tribunal and its staff may be present; and
(c) the publication or disclosure of evidence or the contents of documents lodged with or received in evidence by the Tribunal is restricted to the parties and their representatives and witnesses, the Tribunal and its staff and the staff of Auscript.
14 The AAT subsequently amended its orders by adding at the end of Order 2(c) the words “except insofar as the respondent may need to disclose evidence of the contents of documents lodged with or received in evidence by the Tribunal to a Court for the purpose of any application made to a Court in relation to this decision”.
15 On 24 September 2009 ASIC filed an application in the original jurisdiction of this Court relying on s 39B of the Judiciary Act 1903 (Cth) and s 1337B(1) of the Corporations Act. ASIC subsequently amended this application on 14 October 2009. By the amended application, ASIC seeks orders quashing the AAT’s orders and requiring the AAT to decide the second respondent’s interlocutory application according to law, as well as related declarations concerning ASIC’s duties under ss 920E(2) and 922A of the Corporations Act.
16 Under s 20(1A) of the Federal Court of Australia Act 1976 (Cth), the Acting Chief Justice determined that this matter was of sufficient importance to justify directing that the original jurisdiction of the Court in relation to the whole of the matter be exercised by a Full Court. Accordingly, we are seized of the entirety of ASIC’s application.
ISSUES
17 ASIC contends that the AAT did not have power to make the orders other than the order staying the operation and implementation of the banning order itself. According to ASIC:
(1) ASIC must comply with ss 920E(2) and 922A of the Corporations Act by reason of the mere fact of the making of the banning order. It is immaterial whether the banning order is affirmed or set aside by the AAT or is valid or invalid.
(2) Once the statutory regimes are properly analysed it is apparent that the AAT’s purported orders under s 41(2) of the AAT Act cannot have been made “for the purpose of securing the effectiveness of the hearing and determination of the application for review”. This is because the AAT’s powers under s 41(2) cannot extend to interfering with the carrying out of ASIC’s duties under ss 920E(2) and 922A of the Corporations Act.
(3) The AAT’s purported orders under s 41(2) of the AAT Act relating to ASIC’s obligations under ss 920E(2) and 922A(1) of the Corporations Act and ASIC’s issue of any media release do not stay or otherwise affect the “operation or implementation of the decision to which the relevant proceeding relates”.
(4) The AAT’s errors in respect of s 41(2) of the AAT Act affected its approach to its exercise of its powers pursuant to s 35(2).
(5) Section 35(2) of the AAT Act does not empower the AAT to order parties or persons to describe an applicant in a particular way.
(6) The terms of the AAT’s purported pseudonym order are defective and thus the order is ineffective.
18 It will be apparent from this summary that ASIC’s principal case is not that the AAT erred in exercising an available power by, for example, asking itself the wrong question or failing to take into account relevant considerations or taking into account irrelevant considerations. ASIC’s principal case is that the AAT did not have the power to make the orders it did except in respect of the operation and implementation of the banning order itself.
19 The question of power is to be answered by construing the statutory provisions which vest functions in the AAT and ASIC respectively. We turn now to those provisions.
STATUTORY PROVISIONS
General
20 We are required to deal with two Commonwealth statutes, each with a particular field of operation. Courts do not lightly infer that, in enacting statutes, a parliament intended to contradict itself (see, for example, the cases and commentary in D C Pearce and R S Geddes. Statutory Interpretation in Australia. 6th ed. LexisNexis Butterworths (2006) at [7.10]). Further, the task of statutory interpretation cannot be carried out by focusing on any provision in isolation. The legislative context is critical (Project Blue Sky v Australian Broadcasting Authority (1998) 194 CLR 355; [1998] HCA 28). These principles of general application must be kept in mind when determining the proper construction of the statutory provisions in question.
The Corporations Act
21 Under s 920A(1) of the Corporations Act ASIC may make a banning order by giving written notice to a person in certain circumstances. However, by s 920A(2) ASIC may only make a banning order after giving the person an opportunity to be heard (in private) and make submissions other than in the two circumstances specified in s 920A(3) (where immediate cancellation or suspension of a financial services licence is authorised pursuant to s 915B or in case of a conviction for serious fraud).
22 Section 920B(1) specifies that a banning order is:
… a written order that prohibits a person from providing any financial services or specified financial services in specified circumstances or capacities.
23 Section 920B(2) provides:
(2) The order may prohibit the person against whom it is made from providing a financial service:
(a) permanently; or
(b) for a specified period, unless ASIC has reason to believe that the person is not of good fame or character.
24 Under s 920C(1) a person against whom a banning order is made cannot be granted an Australian financial services licence contrary to the banning order. By s 920C(2):
(2) A person contravenes this subsection if:
(a) the person engages in conduct; and
(b) the conduct breaches a banning order that has been made against the person.
Such a contravention is an offence under s 1311(1).
25 Section 920D(1) provides that ASIC may cancel or vary a banning order by giving written notice to the person against whom the order was made if “ASIC is satisfied that it is appropriate to do so because of a change in any of the circumstances based on which ASIC made the order”.
26 Under s 920E(1) a banning order “takes effect when it is given to the person against whom the order is or was made”.
27 Section 920E(2) is in the following terms:
(2) ASIC must publish a notice in the Gazette as soon as practicable after making, varying or cancelling a banning order. The notice must state when the action took effect and:
(a) in the case of the making of a banning order - set out a copy of the banning order; or
(b) in the case of the variation of a banning order - set out a copy of the banning order as varied.
28 Under s 920F(1) a banning order must be accompanied by a statement of reasons for the order.
29 Section 922A(1) requires ASIC to establish and maintain registers relating to financial services. Section 922A(2) provides for the Corporations Regulations to prescribe the way in which the registers are to be established and maintained including the details that ASIC must enter in respect of persons against whom a banning order is made. Regulation 7.6.06(1) is as follows:
(1) For subsection 922A(2) of the Act, ASIC must include the following details for each person against whom a banning order is made in the register of persons against whom a banning order under Division 8 of Part 7.6 of the Act is made:
(a) the person's name;
(b) the day on which the banning order took effect;
(c) whether the banning order is permanent or for a fixed period;
(d) if the banning order is for a fixed period - the period;
(e) the terms of the banning order;
(f) whether the banning order has been varied or cancelled;
(g) if the banning order has been varied:
(i) the date of the variation; and
(ii) the terms of the variation;
(h) if the banning order has been cancelled - the date of the cancellation;
(i) any other information that ASIC believes should be included in the register.
30 Section 1317B(1) of the Corporations Act provides for the AAT to review decisions by ASIC (amongst others) in these terms:
(1) Subject to this Part, applications may be made to the Tribunal for review of a decision made under this Act by:
(a) the Minister; or
(b) ASIC; or
(c) the Companies Auditors and Liquidators Disciplinary Board.
31 The reference to “the Tribunal” in s 1317B(1) is a reference to the AAT (s 9).
32 By s 1317A “decision” has the same meaning as in the AAT Act (see [34] below).
33 A decision to make a banning order is thus reviewable by the AAT. By s 1317D(2) ASIC is thus required to:
…take such steps as are reasonable in the circumstances to give to each person whose interests are affected by the decision notice, in writing or otherwise:
(a) of the making of the decision; and
(b) of the person's right to have the decision reviewed by the Tribunal.
The AAT Act
34 The AAT’s principal function is to review decisions. Section 3(3) of the AAT Act defines “decision” broadly so as to include “making, suspending, revoking or refusing to make an order or determination” (s 3(3)(a)) and “doing or refusing to do any other act or thing” (s 3(3)(g)).
35 The AAT’s principal function of review is governed by s 43 of the AAT Act. Section 43(1) is as follows:
(1) For the purpose of reviewing a decision, the Tribunal may exercise all the powers and discretions that are conferred by any relevant enactment on the person who made the decision and shall make a decision in writing:
(a) affirming the decision under review;
(b) varying the decision under review; or
(c) setting aside the decision under review and:
(i) making a decision in substitution for the decision so set aside; or
(ii) remitting the matter for reconsideration in accordance with any directions or recommendations of the Tribunal.
36 Sections 43(5A), (5B) and (6) deal with the effect of the AAT’s decisions and are in these terms:
(5A) Subject to subsection (5B), a decision of the Tribunal comes into operation forthwith upon the giving of the decision.
(5B) The Tribunal may specify in a decision that the decision is not to come into operation until a later date specified in the decision and, where a later date is so specified, the decision comes into operation on that date.
…
(6) A decision of a person as varied by the Tribunal, or a decision made by the Tribunal in substitution for the decision of a person, shall, for all purposes (other than the purposes of applications to the Tribunal for a review or of appeals in accordance with section 44), be deemed to be a decision of that person and, upon the coming into operation of the decision of the Tribunal, unless the Tribunal otherwise orders, has effect, or shall be deemed to have had effect, on and from the day on which the decision under review has or had effect.
37 Section 35 concerns the hearing of a proceeding by the AAT. It provides that:
…
(1) Subject to this section, the hearing of a proceeding before the Tribunal shall be in public.
…
(2) Where the Tribunal is satisfied that it is desirable to do so by reason of the confidential nature of any evidence or matter or for any other reason, the Tribunal may, by order:
(a) direct that a hearing or part of a hearing shall take place in private and give directions as to the persons who may be present; and
(aa) give directions prohibiting or restricting the publication of the names and addresses of witnesses appearing before the Tribunal; and
(b) give directions prohibiting or restricting the publication of evidence given before the Tribunal, whether in public or in private, or of matters contained in documents lodged with the Tribunal or received in evidence by the Tribunal; and
(c) give directions prohibiting or restricting the disclosure to some or all of the parties to a proceeding of evidence given before the Tribunal, or of the contents of a document lodged with the Tribunal or received in evidence by the Tribunal, in relation to the proceeding.
(3) In considering:
(a) whether the hearing of a proceeding should be held in private; or
(b) whether publication, or disclosure to some or all of the parties, of evidence given before the Tribunal, or of a matter contained in a document lodged with the Tribunal or received in evidence by the Tribunal, should be prohibited or restricted;
the Tribunal shall take as the basis of its consideration the principle that it is desirable that hearings of proceedings before the Tribunal should be held in public and that evidence given before the Tribunal and the contents of documents lodged with the Tribunal or received in evidence by the Tribunal should be made available to the public and to all the parties, but shall pay due regard to any reasons given to the Tribunal why the hearing should be held in private or why publication or disclosure of the evidence or the matter contained in the document should be prohibited or restricted.
38 Sections 41(1) and (2) concern the operation and implementation of a decision subject to review by the AAT. They provide that:
(1) Subject to this section, the making of an application to the Tribunal for a review of a decision does not affect the operation of the decision or prevent the taking of action to implement the decision.
(2) The Tribunal may, on request being made, as prescribed, by a party to a proceeding before the Tribunal (in this section referred to as the relevant proceeding), if the Tribunal is of the opinion that it is desirable to do so after taking into account the interests of any persons who may be affected by the review, make such order or orders staying or otherwise affecting the operation or implementation of the decision to which the relevant proceeding relates or a part of that decision as the Tribunal considers appropriate for the purpose of securing the effectiveness of the hearing and determination of the application for review.
THE SECTION 41(2) ISSUES
ASIC’s submissions
39 ASIC’s first proposition is that its duties to publish a notice of the making of a banning order under s 920E(2) and to make relevant entries in the register under s 922A(1) of the Corporations Act are enlivened by the mere fact that a banning order has been made. Because the direction to publish is particular and unqualified, the AAT’s general stay power cannot be used to limit or qualify it. According to ASIC the object of the provisions is to inform the public of ASIC’s performance of its regulatory functions at the earliest practicable opportunity and not after the exercise of rights of review to the AAT. This is consistent with the duties imposed on ASIC by s 1(2) of the Australian Securities and Investments Commission Act 2001 (Cth) including s 1(2)(b) which requires ASIC to strive to “promote the confident and informed participation of investors and consumers in the financial system”.
40 ASIC noted that the terms of the obligation imposed on it by s 920E(2) of the Corporations Act (to publish a notice of the making of a banning order “as soon as practicable”) may be contrasted with s 1299K(2) which expressly contemplates ASIC delaying the coming into effect of decisions cancelling or suspending registration as an audit company to enable the making of an application to the AAT for review. Unlike s 1299K(2), s 920E(2) imposes a strict time requirement which makes no allowance for the possibility of an application to the AAT to review the decision. Another example, from a different statutory context, is s 31A(4) of the Civil Aviation Act 1988 (Cth) which creates an automatic stay for five days of a decision to facilitate a person applying for a lengthier stay from the AAT under s 41(2) of the AAT Act.
41 These factors, ASIC submitted, indicate that the mere fact that a banning order has been made enlivens ASIC’s duty to publish. ASIC also observed that when a banning order is made, ASIC cannot know whether the AAT will affirm, vary or set aside the banning order under s 43 of the AAT Act having regard to the AAT’s obligation to make the “correct or preferable decision in the case before it according to the material before it” (Bushell v Repatriation Commission (1992) 175 CLR 408 at 425 and Shi v Migration Agents Registration Authority (2008) 235 CLR 286; [2008] HCA 31 at [35]-[38], [98] and [140]). ASIC also cannot know, when a banning order is made, whether the banning order is valid or invalid or will be subject to judicial review challenging its validity or not. According to ASIC it thereby follows that a person’s capacity to seek merits or judicial review of a banning order (by the AAT or a court of competent jurisdiction respectively) is immaterial to ASIC’s obligation to perform its statutory duties. Hence, on ASIC’s approach, even if a person seeks merits review of a banning order and the AAT decides the order should be set aside, ASIC’s duties under ss 920E(2) and 922A(1) of the Corporations Act remain. Specifically, if a banning order is made (albeit subsequently set aside on merits review), ASIC must both publish notice of the fact of the making of the banning order in the Gazette and make the required entries in the register.
42 ASIC’s second proposition builds upon its first. It is that if ASIC must fulfil its statutory duties to publish the fact of the making of a banning order irrespective of the outcome of the AAT’s review, it must also follow that an exercise of power under s 41(2) of the AAT Act purporting to prevent ASIC from discharging its statutory duties under ss 920E(2) and 922A(1) of the Corporations Act can never be “for the purpose of securing the effectiveness of the hearing and determination of the application for review”. That is, according to ASIC, its obligation to publish is simply unaffected by the AAT’s review powers. On ASIC’s case the observation in Duncan v Companies Auditors Liquidators Disciplinary Board (2006) 155 FCR 572; [2006] FCA 1747 at [12] about analogous obligations to publish existing “only for so long as the decision continued to have effect” is incorrect. ASIC submitted that the reasoning in Allied Asia Holdings (Aust) Pty Ltd v Australian Securities and Investments Commission [2002] FCA 566 at [16] (that the AAT has power to make an order affecting the operation or implementation of the decision only and not the fact that the decision has been made) is to be preferred.
43 ASIC’s third proposition is that the power in s 41(2) of the AAT Act is to make a stay or other order affecting the “operation” or “implementation” of the decision only. According to ASIC, the reasoning in Duncan at [11] and Collins v Minister for Immigration and Ethnic Affairs (No 2) (1982) 5 ALD 32 at 33 indicates that some decisions may involve operation and implementation. Some may involve operation or implementation. Others may involve neither operation nor implementation. According to ASIC this is because, as Emmett J held in Duncan, the words “operation” and “implementation” take their ordinary meaning. The operation of a decision is the work the decision does. A negative decision, such as that in Collins involving a refusal to revoke an earlier decision, leaves the status quo untouched; such a decision does not “operate”. The implementation of a decision involves the actions taken to complete, execute or put the decision into effect. A decision that requires further steps before it is carried out is capable of implementation. Other decisions which do not involve further steps do not require implementation. Against this background, ASIC submitted, s 41(2) is not directed at the fact of the decision having been made. It is more limited in scope.
44 According to ASIC a banning order does not require implementation. The relevant decision is the making of a banning order by giving it to the intended recipient. Once made by its being given to a recipient, a banning order takes effect by operation of the provisions of the Corporations Act (ss 920A(1) and 920E(1)). The publication of the making of the banning order and its entry into the register are not steps to complete, execute or put into effect the banning order. Hence, these steps are not the implementation of a banning order. ASIC submitted that in the present case the AAT (by relying on Re PTLZ and Australian Securities and Investments Commission (2008) 100 ALD 648; [2008] AATA 106 and declining to follow Re Cape York Airlines Pty Ltd and Civil Aviation Safety Authority (2004) 80 ALD 364; [2004] AATA 682 and Re Quinlivan and Australian Securities and Investments Commission (2008) 106 ALD 438; [2008] AATA 1094) erred in characterising ASIC’s duties with respect to publication and maintenance of the register as involving the implementation of the decision.
45 ASIC also submitted that a banning order operates through the provisions of the Corporations Act (specifically, ss 920B and 920C). ASIC’s duties with respect to publication and maintenance of the register, accordingly, are not part of the operation of a banning order. They are merely related regulatory activity.
46 ASIC supported its third proposition by reference to the terms used by s 41(2) of the AAT Act to confer power on the AAT, namely, to stay or otherwise affect the operation or implementation of the decision. ASIC submitted that the “otherwise affecting” power enabled the AAT to make an order that has some lesser impact on the operation or implementation of a decision than an order for a stay.
47 ASIC characterised its submissions as reflecting Parliament’s intention that the fact of the making of a banning order should be published as soon as practicable in the public interest. The publication provisions emphasise the public interest in open government and, said ASIC, should not be weakened (citing Vinton Smith Dougall Ltd v Australian Securities Commission (1997) 23 ACSR 567 at 570). ASIC also described it as unlikely that Parliament intended that there be a race between ASIC complying with its statutory duties and a recipient of a banning order managing to obtain an order from the AAT under s 41(2) purporting to preclude ASIC from fulfilling those duties.
Discussion
Some general observations
48 It is important to recall that ASIC’s contentions about the operation of s 41(2) of the AAT Act concern the AAT’s power to make an order affecting ASIC’s obligations under ss 920E(2) and 922A(1) of the Corporations Act (that is, to publish notice of and make entries in the register about the making of a banning order). Because its arguments focus on the power of the AAT, ASIC’s case is that, irrespective of the facts or circumstances of the particular proceeding, the AAT may never make an order under s 41(2) of the AAT Act affecting these duties of ASIC under the Corporations Act.
49 For the reasons given below, ASIC’s focus on the power (or lack of power) of the AAT is misplaced. If differently framed, by reference to the AAT’s actual decision in the present case, ASIC’s submissions may have been more persuasive. The reason for this is that the AAT’s power under s 41(2) of the AAT Act is contingent on the AAT having formed an opinion that the making of an order under s 41(2) of the AAT Act “is desirable…taking into account the interests of any persons who may be affected by the review”. It is appropriate to explain our reasons for considering that ASIC’s arguments about the AAT’s powers are misplaced in order to expose both the limited scope of ASIC’s challenge to the AAT’s orders and aspects of the operation of the two statutory regimes we consider important.
50 The power in s 41(2) of the AAT Act is to make an order staying or otherwise affecting the operation or implementation of a decision under review. The power is conditional on the making of a request and the holding of an opinion by the AAT. The required opinion is that it is desirable to make the order. The AAT may only form this opinion after taking into account “the interests of any persons who may be affected by the review”. Accordingly, the AAT must identify for itself and consider the relevant interests. Unless it does so, the AAT cannot form the required opinion. As Latham CJ said in R v Connell; Ex parte The Hetton Bellbird Collieries Limited (1944) 69 CLR 407 at 430:
…where the existence of a particular opinion is made a condition of the exercise of power, legislation conferring the power is treated as referring to an opinion which is such that it can be formed by a reasonable man who correctly understands the meaning of the law under which he acts. If it is shown that the opinion actually formed is not an opinion of this character, then the necessary opinion does not exist. A person acting under a statutory power cannot confer power upon himself by misconstruing the statute which is the source of his power.
51 The nature of the decision under review will affect the identification of the “interests of any persons who may be affected by the review”. Accordingly, those interests are to be identified by reference to the statutory scheme under which the decision under review was made. In the case of a banning order the provisions are those which ASIC identified in the Corporations Act and Corporations Regulations (and which are referred to above). It is apparent from those provisions that the person the subject of a banning order is only one of many people whose interests may be affected by the review. A banning order prohibits a person from providing financial services. Under s 766A(1) of the Corporations Act a person provides a financial service in a range of situations including when a person provides “financial product advice”, deals in a financial product, makes a market for a financial product, operates a registered scheme, provides a custodial or depository service or otherwise engages in conduct of a kind prescribed by the Corporations Regulations. Given the nature of a banning order, the persons who may be affected by a review of its making include not only the recipient and his or her dependants, associates and employees but also that person’s existing and potential clients, as well as the public at large.
52 Determining whether the making of an order under s 41(2) of the AAT Act is desirable requires resolving these potentially competing interests. In this process of resolution the scheme embodied by the legislation under which the banning order is made is central. The context set by that scheme is a “fundamental element” in the formation of the opinion according to law (The Queen v Hunt; Ex parte Sean Investments Pty Ltd (1979) 180 CLR 322 at 329). The scheme discloses that a banning order protects the public. It is intended to protect the public from obtaining financial services from a person who (amongst other things) has not, or ASIC reasonably believes has not, complied with a financial services law or has had their Australian financial services licence suspended or cancelled (s 920A(1)).
53 The structure of the scheme also indicates Parliament’s assessment of the appropriate resolution of the competing interests of persons who may be affected by a banning order. Other than in limited circumstances a banning order cannot be made without giving the proposed recipient a right to be heard and to make submissions in private to ASIC (s 920A(2)). A banning order must be accompanied by a statement of reasons (s 920F(1)). If, and only if, ASIC makes a banning order is it required to make public that fact (ss 920E(2) and 922A). For the AAT to form an opinion under s 41(2) of the AAT Act (that it would be desirable and in the “interests of any persons who may be affected by the review” to make an order staying or otherwise affecting the operation or implementation of ASIC’s decision) these elements of the statutory regime, and the balance between the competing interests that they represent, must be treated as a fundamental element in the weighing of the competing considerations.
54 Moreover, information is the key to effective trading in any market. It takes the place of regulation in ensuring fairness. A market which is not fully informed is not operating properly. Is not an investor who is about to deposit funds with a person providing financial services entitled to know that a banning order has been made against the person? If the order has been stayed on substantial grounds the person is also entitled to know that. The informed investor may continue with the proposal. If the investor does not, then that is just an example of the operation of the market place. The critical matter is that the market is fully informed. If the banning order is not disclosed, but subsequently upheld, is not the investor entitled to complain that all the circumstances should have been made public?
55 The power of the AAT to make an order effectively staying the banning order itself is not in doubt. That seems to us to be the primary interlocutory remedy a person banned might seek. Once that order is granted the need for secrecy by the imposition of a further stay of publication will not usually arise. The occasion for such a further order will be rare. At the least, consideration of such a further order should be separate from consideration of the stay of the banning order itself (see Australian Securities and Investments Commission v PTLZ (2008) 48 AAR 559; [2008] FCAFC 164 at [52]). The appropriateness of a stay of publication will be significantly affected by the granting of a stay of the banning order itself.
56 In the present matter the AAT’s reasons for the making of orders under ss 41(2) and 35(2) of the AAT Act do not disclose consideration of these critical elements of the Corporations Act. The AAT’s reasons appear to proceed on an unfounded assumption that the scheme established by the Corporations Act is either neutral in, or mere background to, the formation of the required opinion of desirability. We do not accept that assumption. Although the reasons briefly address the public interest in [28]-[29], they do not appear to grapple with the context set by the Corporations Act or the importance of the availability of information to the market generally and to existing and potential customers of the second respondent, as a critical element in the public interest.
57 As noted, it is true that s 41 will require consideration of the situation of dependents, associates and employees of the banned person. Employees may lose their employment if knowledge of the ban affects the person’s business. However unfortunate this may be, we think it is of lesser significance than the matters to which we have referred.
58 Rather than treating these matters as critical to the way in which the AAT exercised powers available to it under ss 41(2) and 35(2) of the AAT Act, ASIC argued that those matters (amongst others) demonstrated that the AAT had no power to make orders under those sections. In so doing, ASIC accepted a heavy burden of argument. To succeed on its case as framed, ASIC had to establish that, in any proceeding and irrespective of the circumstances of the proceeding, the AAT could never make an order affecting ASIC’s obligations under ss 920E(2) and 922A(1) of the Corporations Act. ASIC’s arguments have not persuaded us to that conclusion for the following reasons.
Does the mere fact of making a banning order enliven ASIC’s duties in every case?
59 ASIC’s first proposition, that its duty to publish a notice is irrevocably enlivened by the mere fact of a banning order having been made, is inconsistent with: - (i) the reasoning of the High Court in Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597; [2002] HCA 11, (ii) the operation of the AAT Act, and (iii) the principles of construction applicable to the construction of two statutes made by a single legislature. This inconsistency arises in the context of the availability of both judicial review and merits review.
60 As to judicial review, Bhardwaj is significant not only because it characterises a decision affected by jurisdictional error as “no decision at all” (at [51]), but also because the High Court held that the administrative decision-maker, at least on the facts of that case, was entitled to treat its own decision as no decision at all without the making of orders and declarations consequential on judicial review by a court. It is difficult to reconcile this reasoning process with ASIC’s submissions in the present case. On facts analogous to those in Bhardwaj, ASIC would be entitled to treat its own decision as not being a decision at all. It must follow that, in such a case, ASIC also would be entitled to treat its purported banning order as not enlivening any obligations under ss 920E(2) or 922A(1) of the Corporations Act. Once this is accepted it is apparent that the absolute nature of ASIC’s first proposition is untenable. In short, in some circumstances a purported banning order will not be a banning order enlivening ASIC’s duties under ss 920E(2) or 922A(1).
61 As to merits review, s 43(6) of the AAT Act provides that a decision of the AAT on review is deemed to be a decision of the original decision-maker and, unless the AAT otherwise orders, is deemed to have effect on and from the date on which the decision under review had effect. Hence, if the AAT sets aside a banning order, under s 43(6) that decision will be deemed to be the decision ASIC made and will have effect as such on and from the date of the making of the banning order. In these circumstances, if ASIC had not already published notice of the making of the banning order and updated the register, it could have no duty to do so under ss 920E(2) and 922A(1) of the Corporations Act. Once this is accepted it is again apparent that the absolute quality of ASIC’s first proposition is untenable. In short, in some circumstances a banning order may have been made but ASIC’s duties under ss 920E(2) or 922A(1) of the Corporations Act, if not fulfilled before the banning order is set aside by the AAT, may never be enlivened, by reason of the outcome on merits review of the decision.
62 As to the principles of statutory construction, a legislature is generally presumed not to intend to contradict itself. It follows that each statute emanating from a single legislature, if possible, is construed to have full force and effect according to its terms. It may be accepted that the Corporations Act, a statute later in time than the AAT Act, casts on ASIC a specific set of obligations with respect to banning orders. It may also be accepted that s 41(2) of the AAT Act is a general provision applying to all applications for review before the AAT. The statutory provisions, however, are not inconsistent. They are capable of operating together. The making of the banning order triggers the recipient’s right to seek review by the AAT and, consequently, the exercise by the AAT of its own statutory powers including its powers in s 41(2) of the AAT Act. If by that time ASIC has not published notice of the banning order, the recipient may request (as part of an application under s 41(2)) a stay not only of the banning order itself but also of the publication of the notice of its making and the required entry in the register.
63 In circumstances where the banning order is reviewable by the AAT, the fact that ASIC’s publication obligation is to be discharged as soon as practicable is an insufficient basis upon which to construe the AAT’s powers under s 41(2) as being excluded by the provisions of the Corporations Act. “As soon as practicable” means what it says. In some cases, ASIC may have published before any application is made to the AAT for a stay. In others, ASIC may not have done so. This potential does not indicate that the AAT has no power to exercise in any case.
64 For the same reasons, ASIC’s invocation of an unseemly race between it (to publish) and the recipient of the banning order (to apply for a stay) is also unpersuasive. ASIC is entitled (indeed, bound) to act as soon as practicable. A recipient is also entitled to apply to the AAT for review. A well-advised recipient may seek to invoke s 41(2) of the AAT Act and a poorly informed recipient may remain unaware of that opportunity. No doubt there are countless similar situations in which statutory time requirements are imposed. Those affected by such requirements inevitably have different capacities and resources available to them. Further, an exercise of power under s 41(2) of the AAT Act may have no utility if ASIC has already published notice of the making of the banning order. The utility of any order, however, is always a relevant consideration. These possibilities speak to the appropriateness of an exercise of the power in the particular case and not the availability of the power in each and every case.
Can a stay of ASIC’s duties be for the required purpose?
65 Analysis of ASIC’s first proposition also discloses the flaw in its second proposition. ASIC’s second proposition is that an exercise of power under s 41(2) of the AAT Act purporting to prevent ASIC from discharging its statutory duties under ss 920E(2) and 922A(1) of the Corporations Act can never be “for the purpose of securing the effectiveness of the hearing and determination of the application for review” as required by s 41(2). The reason for this, ASIC submitted, is that it is bound to discharge its statutory duties irrespective of the outcome of the review application.
66 The reasoning in support of this second proposition cannot be reconciled with the terms of s 43(6) of the AAT Act. Under that section (and subject to a contrary order by the AAT), the AAT’s decision (if it varies or sets aside ASIC’s decision) is deemed to be ASIC’s decision and is deemed to take effect from the date ASIC’s decision took effect. It follows that if the AAT sets aside a banning order altogether, s 43(6) operates so that the banning order is deemed never to have taken effect (unless the AAT otherwise orders). This must be considered together with the fact that the making of a banning order is reviewable by the AAT and that the timing of an application for review, including the timing of any possible application for a stay under s 41(2) of the AAT Act, is not within ASIC’s control. From these factors, it is apparent that the making of an order staying or otherwise affecting ASIC’s discharge of its duties under s 41(2) of the AAT Act is capable of being for the relevant purpose of “securing the effectiveness of the hearing and determination of the application for review” as required by that section. The facts of the present case, moreover, bear this out.
What is the scope of the operation or implementation of the decision?
67 ASIC’s third proposition is that the operation and implementation of a decision to make a banning order under s 920A(1) of the Corporations Act does not extend to ASIC’s duties to publish notice of the banning order and maintain the register under ss 920E(2) and 922A(1) of that Act. Accordingly, the AAT cannot make an order affecting those duties under s 41(2) of the AAT Act because the AAT’s powers are limited to the making of a stay or other order affecting the operation or implementation of the decision.
68 These arguments are not persuasive. It is one thing to accept that a banning order takes effect and thus has operative force by reason of the provisions of the statute (ss 920A(1) and 920E(1)) and that the publication of the notice of the making of the banning order and updating of the register do not, in terms, complete some aspect of the banning order. It is another to accept that the concepts of the operation or implementation of the making of the banning order do not extend to the banning order’s publication both by notice and by entry in the register.
69 The ordinary meaning of the terms operation or implementation explored by Emmett J in Duncan, and which ASIC accepted, do not support the narrow interpretation underpinning ASIC’s argument. Allied Asia Holdings, the case on which ASIC relied, is an extempore judgment about whether an interlocutory injunction should be granted. Heerey J, in [16] of the reasons for judgment, made a passing reference only to a distinction between a stay affecting the operation or implementation of the decision and the fact that the decision has been made. Moreover, the decision in question in Allied Asia Holdings was not the making of a banning order. The decision was a refusal to renew a person’s registration. The capacity for an order in the nature of a stay to affect such a decision is not straightforward (see, for example, Yolbir v Administrative Appeals Tribunal (1994) 48 FCR 246 at 249F and Shi v Migration Institute of Australia Ltd (2003) 134 FCR 326; [2003] FCA 1304 at [26]-[30]). Allied Asia Holdings cannot support the weight which ASIC placed on it; in any event, it is distinguishable.
70 Accordingly, we consider that the act of publication is part and parcel of both the operation and the implementation of the banning order. The work a banning order does is made effective, at least in part, by its publication. The steps required to complete the statutory process involved in the making of a banning order include its publication. This is sufficient to enliven the AAT’s powers under s 41(2) of the AAT Act. Earlier versions of s 41(2) to which we were taken, and related extrinsic material, do not indicate to the contrary.
71 For these reasons we do not accept that the AAT has no power to make an order under s 41(2) of the AAT Act staying or otherwise affecting ASIC’s actions under ss 920E(2) and 922A(1) of the Corporations Act. We consider that the matters exposed by ASIC’s arguments do not indicate a lack of power to make such orders. Rather, they indicate the careful consideration which must be given by the AAT in any exercise of power under s 41(2) of the AAT Act to the balance of competing rights and interests struck by Parliament as embodied in the terms of the Corporations Act, particularly the balance between the rights and interests of the recipient of the banning order and of the public including existing and potential future clients of the recipient of the banning order. As we have said the scheme which the provisions of the Corporations Act embody – with the potential making of a banning order to remain private unless and until ASIC decides to make such an order after having given the recipient an opportunity to be heard – is not mere statutory background or a neutral factor in the process of the formation of the required opinion about what is desirable under s 41(2) of the AAT Act. The scheme which Parliament has established in the Corporations Act, and the public interest in the right of the market to know relevant information as soon as practicable, must be treated as a fundamental element in the decision-making process required under s 41(2) of the AAT Act.
THE SECTION 35(2) Issues
72 It follows from our conclusions about s 41(2) of the AAT Act that we do not accept that any error made by the AAT about its powers under that section led it into error with respect to its powers under s 35(2). Accordingly, we do not accept ASIC’s first contention about the AAT’s exercise of power under s 35(2) of the AAT Act.
73 ASIC’s second contention about s 35(2) of the AAT Act, in common with its approach to s 41(2), focused on the powers available to the AAT under that section. ASIC did not submit, for example, that the AAT erred in the way in which it exercised its powers by failing to consider, as a fundamental element in its consideration, the requirements imposed on it by s 35(1) of the AAT Act which is in these terms:
(1) Subject to this section, the hearing of a proceeding before the Tribunal shall be in public.
74 Again, we think it is important to emphasise certain aspects of the statutory provisions. Although s 35(1) is subject to the balance of the section, it establishes a norm. The norm is that the proceedings before the AAT shall be in public. This norm is reinforced by the requirements of s 35(3) which expressly confirm the principle that it is desirable that hearings be held in public. It follows that when deciding whether it is satisfied that it is desirable to exercise its powers under s 35(2), the AAT is required to form a state of satisfaction which recognises the existence of the norm and the values it is intended to protect. This, no doubt, is why Brennan J in Re Pochi and Minister for Immigration and Ethnic Affairs (1979) 36 FLR 482 at 510 described the power in s 35(2) to depart from this norm as one to be exercised “sparingly”. It also explains the approach in Australian Securities and Investments Commission v PTLZ (2008) 48 AAR 559; [2008] FCAFC 164 at [6], [41] and [42] (an appeal to the Full Court of the Federal Court from the decision of the AAT in Re PTLZ and Australian Securities and Investments Commission (2008) 100 ALD 648; [2008] AATA 106) emphasising that the words of s 35(3) require this principle of the desirability of hearings to be in public to be “the basis” of the AAT’s consideration of adopting a different approach (in contrast, for example, to “a basis” for that consideration).
75 Suppression orders are rarely made in courts, even though publicity undoubtedly disadvantages the parties. Criminal proceedings are a good example. In the AAT itself facts which parties would not wish to be published and which may disadvantage them are frequently published. Social security applications are a good example. The reason these matters are not kept secret is the overriding importance of justice being administered openly and in public. It is not readily apparent why persons in businesses should be treated differently even when, for example, employees may be disadvantaged.
76 When measured against the existence of the norm of a public hearing and the scheme established by the Corporations Act with respect to banning orders, it is apparent that the AAT would need some cogent reason by reference to the particular case to depart from the ordinary requirement of a public hearing. It is difficult to accept that harm (even serious harm) to the recipient’s reputation resulting from public awareness of the banning order will be a sufficiently cogent reason to justify the grant of a stay in most cases. This is because the risk of harm of this type is inherent in the nature of a banning order.
77 To return to ASIC’s main argument in support of its second contention, ASIC relied on the fact that s 35(2) of the AAT Act does not refer to the names of parties (in contrast to the names of witnesses). ASIC referred to the decision in Re Graeber and Australian Prudential Regulatory Authority (2007) 46 AAR 115; [2007] AATA 1966 in which it was decided that the AAT had no power to suppress the names of parties to the proceeding. The reasoning in Graeber is to the effect that, as witnesses are expressly referred to in s 35(2)(aa) (an amendment introduced in 1995) and parties in s 35(2)(c), it should be concluded that Parliament did not intend to achieve indirectly by s 35(2)(b) (a power to prohibit or restrict matters contained in documents lodged with the AAT) that for which it had made no direct provision. The second respondent relied on the reasoning in VBJ and Australian Prudential Regulation Authority (2005) 60 ATR 1013; [2005] AATA 642 in which the AAT held to the contrary.
78 We do not find persuasive the reasoning in Graeber or ASIC’s submissions in reliance thereon. Section 35(2) must be construed recognising that s 35(2)(aa) was inserted in 1995 by the Law and Justice Legislation Amendment Act (No 1) 1995 (Cth). The insertion of an amending provision dealing with a specific issue (in this case, a power to prohibit or restrict the publication of the names and addresses of witnesses) should not be used to read down the natural and ordinary meaning of other provisions. It should be construed as an additional power which the AAT might previously have lacked if, for example, the names and addresses of witnesses were not required to be disclosed in advance of the hearing in some document (such as a witness statement) to be filed with the AAT. Section 35(2)(b), before and after the amendment, empowered the AAT to restrict or prohibit the publication of matters contained in documents lodged with the AAT. The documents so lodged must include the names (and will often include the addresses) of the parties to the proceeding. Section 35(2)(b) is of sufficient scope to empower the AAT to give directions to restrict the publication of both the names and addresses of the parties to the proceeding.
79 We are also satisfied that the scope of the AAT’s power to “give directions prohibiting or restricting the publication of…matters contained in documents lodged with” the AAT extends to the allocation of a pseudonym to one or more parties to the proceeding. The reason for this is that if the AAT is able to give directions prohibiting or restricting the publication of a party’s name, it must also be able to do that which is necessary to make its direction efficacious (Grassby v The Queen (1989) 168 CLR 1 at 23; John Fairfax Publications Pty Ltd v Ryde Local Court (2005) 62 NSWLR 512; [2005] NSWCA 101 at [38]-[47]). While it is correct (as observed in Graeber at [29]) that the characterisation of an implied power as necessary is approached more strictly in cases involving the principle of open justice (see John Fairfax Publications Pty Ltd v Ryde Local Court at [40]), s 35(2)(b) vests power in the AAT to prohibit the publication of a party’s name. The allocation of a pseudonym as a method of identification, in such a case, is not a mere convenience – it is a practical necessity. Of course, this power derived from s 35(2)(b) of the AAT Act is not freestanding. It is an exception to the norm established by s 35(1) and reinforced by s 35(3) that the hearing of a proceeding shall be in public. Consistent with our observations above it follows that this power also is one to be exercised sparingly.
80 As to ASIC’s third and final contention, we accept that there are difficulties with the form of the orders which the AAT made. Order 2(a) (“XQZT be described by a pseudonym for the purpose of protecting his identity”), presumably, intends that the second respondent (who is the applicant in the AAT proceeding) be described by the pseudonym “XQZT” for the purpose of protecting his identity. ASIC’s point that the AAT’s orders could (or should) not be construed to prevent it from disclosing material to relevant authorities and bodies for the purpose of obtaining advice about and commencing any criminal prosecution of the second respondent is also sound. So too is ASIC’s complaint that the orders of the AAT could (or should) not be construed so as to prevent any party from exercising appeal rights. However, the answer to these difficulties is not to be found in ASIC’s arguments about a lack of power. It is to be found in the AAT’s capacity to frame its own orders so as not to have unintended consequences. For example, ASIC approached the AAT to amend its orders so as to ensure that ASIC could disclose all necessary material for the purpose of this application. The AAT amended its orders accordingly on 13 October 2009. The other difficulties with the orders which ASIC identified can be appropriately addressed through the same process.
The AAT’s media release Order
81 We need to deal with one other matter which ASIC did not raise as a separate issue but which was a part of ASIC’s more general contentions about the AAT’s powers. As noted above, the AAT ordered that its “stay” under s 41(2) of the AAT Act extend to “disclosure of the decision in any media release” issued by ASIC. The requirement for publication in the Gazette shows that the legislature considered that publication of a banning order was important. Publications in the Gazette will frequently be followed by publication in the commercial media. This is consistent with the need for a fully informed market. It accordingly seems to us that informal publication by ASIC as well as mandated publication is nevertheless an aspect of the operation and implementation of the banning order. It would be an odd result if ASIC could be restrained from a mandated publication, but not from an informal publication. We accordingly consider that the order precluding directions in a media release was within power.
82 In this matter we do not have to decide whether an order to withdraw a media release (such as the order made in Re PTLZ by DP Forgie) is within power. In judicial terms it amounts to a mandatory injunction. However, although the occasion for the making of such an order will be rare, we do not consider that it is not within power. Once it is accepted that it relates to an activity which is part of the operation or implementation of the banning order, the only question is whether it can be said to be “affecting” that operation or implementation and we see no reason why it should not be so characterised.
CONCLUSIONS
83 Consistent with its approach in Australian Securities and Investments Commission v PTLZ, ASIC argued that the AAT did not have available to it certain powers rather than that the AAT erred in the way in which it exercised its powers. ASIC’s arguments of lack of power, by their nature, could succeed only if we accepted that the AAT could never make orders affecting ASIC’s duties to publish notice of the making of a banning order, to make associated entries in its register, or to issue media releases irrespective of the circumstances of any case. This is a heavy burden given the terms of the powers vested in the AAT by the Commonwealth Parliament. We have not been persuaded by ASIC’s arguments. Those arguments, in our view, disclose important aspects of the two statutory schemes relevant to the exercise of the AAT’s powers. They do not, however, disclose a lack of power on the AAT’s part as ASIC claimed.
84 For these reasons ASIC’s application must be dismissed. Costs should follow the event.
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I certify that the preceding seventy-five (75) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Downes and Jagot. |
Associate:
Dated: 23 December 2009
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Counsel for the Applicant: |
Mr S Lloyd SC and Mr D Gilbertson |
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Counsel for the Second Respondent: |
Mr P Brereton SC and Ms A Rao |
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Solicitor for the Applicant: |
Australian Securities and Investments Commission |
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Solicitor for the Second Respondent: |
Freehills |
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The First Respondent filed a submitting appearance |
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Date of Hearing: |
24 November 2009 |
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Date of Judgment: |
23 December 2009 |
