FEDERAL COURT OF AUSTRALIA

Anstis v Secretary of the Department of Family & Community Services [2002] FCA 1043

ADMINISTRATIVE LAW – notice of objection to competency – application for review contesting a departmental instruction relating to the relinquishment of control of private trusts – Part 3.18 of the Social Security Act – whether applicant has standing to seek declaratory and injunctive relief – applicant advisor on social security matters – where applicant claims that the instruction is wrong at law – whether claimed professional and economic interest a sufficient material interest for standing

Judiciary Act 1903 (Cth), s 39B(1A)

Social Security Act 1991 (Cth), Part 3.18

Australian Conservation Foundation v The Commonwealth (1980) 146 CLR 493  applied

Australian Institute of Marine and Power Engineers v Secretary, Department of Transport (1986) 13 FCR 124  referred

Bateman’s Bay Local Aboriginal Land Council v The Aboriginal Community Benefit Fund Pty Ltd (1998) 194 CLR 247  applied

Onus v Alcoa of Australia Ltd (1981) 149 CLR 27  applied

Royal College of Nursing of the United Kingdom v Department of Health and Social Security [1981] AC 800; at first instance, [1981] 1 All ER 545  distinguished

Gillick v West Norfolk and Wisbech Area Health Authority [1986] AC 112  distinguished

Electricity Supply Association of Australia Ltd v Australian Competition and Consumer Commission (2001) 189 ALR 109  referred

Ainsworth v Criminal Justice Commission (1992) 175 CLR 564  referred

Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334  referred

Ogle v Strickland (1987) 13 FCR 306  distinguished

Maritime Union of Australia v Anderson (2000) 100 FCR 58  followed

BGL Corporate Solutions Pty Ltd v Australian Prudential Regulation Authority (1999) 55 ALD 643  referred

Corio Bay and District Private Hospital NH Pty Ltd v Minister for Family Services (1998) 157 ALR 181  referred

Big Country Developments Pty Limited v Australian Community Pharmacy Authority (1995) 60 FCR 85  referred

Yates Security Services Pty Ltd v Keating (1990) 25 FCR 1  discussed

MICHAEL ANSTIS v SECRETARY OF THE DEPARTMENT OF FAMILY AND COMMUNITY SERVICES

V 22 of 2002

KENNY J

22 AUGUST 2002

MELBOURNE

THE COURT ORDERS THAT:

1.             The application, amended in accordance with notice filed 23 April 2002, be dismissed as incompetent.

2.             The applicant pay the respondent’s costs limited to the notice of objection to competency. 

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

REASONS FOR JUDGMENT

introduction

1                     The respondent has objected to the jurisdiction of this Court to hear and determine an amended application for an order of review in respect of “the conduct/decision of the respondent whereby the respondent issued or caused to be issued a misleading instruction and misleading advice”.  The respondent contends that the applicant has no standing to make the review application.  The application, which was amended on 1 May 2002 in accordance with a notice filed 23 April 2002, sought to invoke the Court’s jurisdiction under s 39B(1A) of the Judiciary Act 1903 (Cth).  In written submissions filed 3 April 2002 and at the hearing on 1 May 2002, the applicant conceded (correctly, in my view) that the Court did not have jurisdiction under the Administrative Decisions (Judicial Review) Act 1977 (Cth) (“the ADJR Act”) to determine the review application. 

background circumstances

2                     The applicant, Mr Michael Anstis, is a solicitor who advises on social security matters.  The respondent is the Secretary of the department of government responsible for administering the Social Security Act 1991 (Cth) (“the department”).

3                     Broadly speaking, under the Social Security Act, a pension claimant must satisfy both an assets test and an income test.  Effectively, a pensioner receives the lower of the two amounts that result from the application of the assets test and the income test.  Part 3.18 of the Social Security Act is entitled “Means Test Treatment of Private Companies and Private Trusts”.  Part 3.18 introduced, from 1 January 2002, a system for the attribution to individuals of the assets and income of private companies and private trusts. 

4                     Subsection 1207X(2) of the Social Security Act, which is in Pt 3.18, concerns private trusts.  The subsection relevantly provides that, for the purposes of Pt 3.18, if a trust is a “controlled private trust” in relation to an individual (and par 1207X(2)(b) is satisfied), then the individual is an “attributable stakeholder” of the trust (unless the respondent determines otherwise).  Further, pursuant to pars 1207X(2)(d) and (e), if the individual is an attributable stakeholder, then the individual’s “asset attribution percentage” and “income attribution percentage” in relation to the trust is either 100%, or such lower percentage as the respondent determines.  Pursuant to subs 1207V(1), for the purposes of Pt 3.18, a trust is a “controlled private trust” in relation to an individual if the trust is a “designated private trust” (as defined in 1207P(1)) and the individual passes the “control test” in subs 1207V(2) or the “source test” in subs 1207V(3).  Subss 1207V(2) and (3) must be read with s 1207C which sets out who are “associates” of an individual.  The effect of these provisions is, as counsel for the respondent submitted, that there would be very few private trusts that would fail to pass the control test set out in subs 1207V(2):  see, e.g., par 1207(2)(d).  The applicant disputes the lawfulness of statements made by the department apparently in connection with the administration of these provisions. 

5                     The parties agreed that the department issued a written statement (which the applicant terms “the Instruction”) concerning resignations from private trusts after 1 January 2002.  This statement (which, for convenience, I too call “the Instruction”) was entitled “Relinquishing Control of a Trust”, and described the circumstances in which “[a] genuine resignation from a private trust will generally be accepted [by officers of the department] as having occurred”.  The Instruction relevantly stated:

A genuine resignation from a private trust will generally be accepted as having occurred where both the controller and their partner: 

·        relinquish all formal roles and control in respect of the trust; and

·        relinquish all beneficial interest in the trust; and

·        make a written declaration that they will not exert any control over, or benefit in any way from the trust.

6                     According to the applicant, the effect of the Instruction is that a pensioner, or a would-be pensioner, must give up all his or her interest in a trust in order to receive a pension, or to avoid the cancellation or reduction of a pension.  The applicant claims that the Instruction is contrary to law and that the Social Security Act, properly construed, does not require such a complete relinquishment of all trust interests. 

7                     In a statement of claim, which was filed on 14 January 2002, the applicant alleged, amongst other things, that:

4.        On or around September 2001 the respondent issued or caused to be issued an instruction entitled ‘Relinquishing Control of a Trust’ (‘the Instruction’) … .

5.        Between September 2001 and December 2001 the Instruction was issued to many people who inquired about pension entitlements and private trusts. 

6.        On or around 5 December 2001 the applicant was contacted by Leon Hyman Solicitors to give advice on the actions pensioners who were deemed to control private trusts could take to maintain their pensions.

7.        On or around 6 December 2001 the applicant contacted five officers (‘the Officers’) representing the respondent who stated that they had authority to give advice on matters to do with private trusts and pensions.  … .

8.        The Officers all stated that unless a person who had been assessed as having control of a private trust gave up all interests in the trust whatsoever, including any beneficial interest, they would be assessed as still controlling the trust (‘the Advice’).  The Officers all referred to the Instruction as the authority for the Advice.

9.        The Instruction and Advice do not accurately reflect the true state of the law. 

particulars

(a)   It is not correct that a person must give up all beneficial interests in a trust for them to be assessed as not having control of the trust.

(b)   A beneficiary with less than 50% interest does not control a trust.

(c)    A trust is controlled by the trustee.

(d)   The legislation is beneficial so you cannot assume that a particular person who is not a trustee or similar controls the trust.

(e)    It is inconsistent with the principle of equality before the law that one beneficiary can be deemed to control the trust when another with the same beneficial interest is deemed not to control the trust.

10.    As a result of the inaccurate Instruction and Advice numerous persons, some of who would be potential clients of the Applicant, have not been willing to consider options which may enable them to maintain their pensions and the Applicant has suffered financial loss.

For the purposes of this objection to competency, the respondent accepted that the applicant was capable of proving these allegations.

8                     Upon the basis of the facts alleged in the statement of claim, the applicant sought, by way of judicial review:

1.      A declaration that the Instruction and the Advice do not accurately reflect the law

2.      That the respondent be compelled to issue a new instruction which accurately reflects the law and

3.      That the respondent allow three months from the issuing of the new instruction for pensioners and others to change their interests in private trusts without their being subject to the deprivation provisions of s 1208M [of the Act].

9                     In opposing the respondent’s objection to competency, the applicant relied on an affidavit sworn by him on 19 April 2002 in which he deposed that:

2.         On or around 5 December 2001 I was approached by Leon Hyman Solicitor to give advice to two clients who had been referred to him because they had been advised by Centrelink that their pensions would be cancelled as from 1 January 2002.  The reason for cancellation was that they were deemed to control private trusts and were affected by Pt 3.18of the Social Security the Act which became effective from that date.  The persons who received this advice received letters about the proposed cancellation in December 2001 despite having provided documentation about their trusts some 12 months earlier.  These persons had been given the ‘Instruction’ which is the subject of this application.  During the next two weeks Leon Hyman received calls from various accountants who had clients who were on [sic] similar positions and had received the Instruction.

3.         After reading the Instruction and the relevant legislation and receiving clarification of the meaning of the Instruction from the officers referred to in the statement of claim I asked each officer what was the basis of the Instruction.  In particular I asked why it was that a person who is deemed to control a trust was required to give up all beneficial interests in the trust if they wished to maintain their pension.  I referred each officer to s 1207V(2) of the Social Security Act 1991 which said ‘the individual passes the control test in relation to a trust if the aggregate of the beneficial interests in the corpus or income of the trust held by the individual and the beneficial interests in the corpus or income of the trust held by associates of the individual is 50 % or more’.  All officers but one said words to the effect that they were merely stating the policy.  [T]hey were not saying it was correct and if I thought it was incorrect I could appeal.  …

4.         The basis of my arrangement with Leon Hyman was that I would receive a fee if I could take action which would enable a client to maintain their pension.  If the person did not keep their pension no payment would be made. 

5.         After speaking to various accountants and explaining the Instruction, legislation and deprivation provisions I interviewed 5 clients.  In 3 cases I took action so that the person could keep their pension.  I was paid for these cases.  In the other 2 cases the persons said they were unwilling to give up all their interest in the trust and were not willing to appeal due to the threat posed by the deprivation provisions.  I did not receive payment for these cases.

6.         I believe there are a large number of people who would like to receive both a pension and trust income but have not taken action because of the combined effect of the Instruction and the deprivation provisions of s 1208M.  [Emphasis added]

10                  The “deprivation” provisions referred to by the applicant were central to his contention that he had standing to pursue this application.  The applicant did not claim any general right of standing for advisers and solicitors with regard to social security matters.  Rather, he submitted that he had standing because, in the circumstances, there was practically speaking no-one else who was better placed than he was to challenge the Instruction.  According to the applicant, this was because, by virtue of the deprivation provisions, a pensioner (or would-be pensioner) was not, practically speaking, in a position where he or she could challenge the application of the Instruction to a decision affecting him or her. 

11                  Broadly speaking, the effect of s 1208M of the Social Security Act is that, if an attributable stakeholder resigns control of a private trust (or private company) on or after 1 January 2002, the attributable stakeholder is treated like other people who have relinquished assets owned by them.  The deprivation provisions apply from the date of resignation or relinquishment.  That is, practically speaking, according to the applicant, the attributable stakeholder would be ineligible for a pension for five years after he or she had relinquishment the trust interest:  see s 1208M and Pt 3.12, Div 2. 

12                  The applicant submitted that, by virtue of the deprivation provisions, a pensioner was unable, practically speaking, to challenge the application of the Instruction to his or her case.  If a pension claimant failed to relinquish a trust interest and was, in consequence, denied a pension, or suffered a reduction in pension, he or she might appeal (or bring some other proceeding challenging the validity of a decision made in conformity with the Instruction).  If, however, the claimant failed on an appeal or in such other proceeding, then in order to be eligible for a pension, he or she would have to relinquish the trust interest.  Having relinquished the trust interest, however, this individual would be unable to receive a pension during the ensuing five years.  This was, so the applicant submitted, such an unacceptable risk that no pensioner could reasonably be expected to assume it by launching an appeal or other proceedings.  Of course, as the applicant pointed out, if a pensioner complied with the Instruction and a decision was made in his or her favour with regard to a pension, then, he or she was unable to appeal since there was no decision adverse to him or her. 

13                  The applicant submitted that, in these circumstances, having regard to the deprivation provisions, he ought to have standing to challenge the Instruction, since he had “a professional and economic interest” in the matter that flowed directly from the Social Security Act.  The applicant’s professional interest derived from his role as a solicitor and adviser knowledgeable about social security law.  In his amended application, he also stated that he was

aggrieved by the conduct/decision because it has caused numerous people some of whom are potential clients of the applicant to surrender their pensions when there were other reasonable options available and that the applicant would have received pay for advice on these matters.

14                  As reference to his affidavit (set out above) shows, the applicant’s claimed economic interest stemmed from the fact that, in cases affected by the Instruction, he was paid for his advice only if a client chose to comply with the Instruction and, as a result, received (or continued to receive) a pension.  By arrangement with the client or the client’s adviser, the applicant was not, it seemed, paid a fee if the client chose not to comply with the Instruction and to forego a pension.  The ground that the applicant relied on to challenge the Instruction and consequential advice given by officers of the department was that the Instruction and advice “were wrong at law”. 

15                  Whilst the applicant made no specific allegation that the Instruction had in fact been applied in making any particular decision under Pt 3.18 of the Social Security Act (regarding, for example, a claim for age pension or investigation of a possible cancellation or reduction in the rate of pension), his case on standing implicitly alleged that, in making decisions under Pt 3.18, the department’s officers were applying the Instruction. 

the legal principles applied

16                  As already noted, the applicant seeks declaratory and injunctive relief against the respondent in respect of the Instruction (and departmental advice given in accordance with the Instruction).  The applicant does not seek to vindicate a right of his own; rather, he is seeking to vindicate a public interest in ensuring that statements made at the behest of the respondent about the operation of the Social Security Act are correct.  As Gibbs J said in a well known passage in Australian Conservation Foundation v The Commonwealth (1980) 146 CLR 493 (“ACF”) at 526:

It is quite clear that an ordinary member of the public, who has no interest other than that which any member of the public has in upholding the law, has no standing to sue to prevent the violation of a public right or to enforce the performance of a public duty. 

Does the applicant in this case have standing to seek judicial review?  If he were found to have standing in respect of a justiciable controversy, then the Court might be said to have jurisdiction under s 39B(1) of the Judiciary Act 1903 (Cth) (since an injunction is sought by him against an officer of the Commonwealth) and by virtue of the Court’s accrued or associated jurisdiction.

17                  In a non-constitutional case of this kind, the same rules govern the applicant’s standing, whether it is a declaration or an injunction that he seeks:  see ACF, at 526 per Gibbs J and 547 per Mason J; and Australian Institute of Marine and Power Engineers v Secretary, Department of Transport (1986) 13 FCR 124, at 132 per Gummow J.  Where a declaration or an injunction is sought, the critical question is whether the applicant has “a sufficient material interest” (often described as a “special interest”) in the subject matter of the proceeding:  see, e.g., Bateman’s Bay Local Aboriginal Land Council v The Aboriginal Community Benefit Fund Pty Ltd (1998) 194 CLR 247 (“Bateman’s Bay”) at 267 per Gaudron, Gummow and Kirby JJ, 283 per McHugh J and 285 per Hayne J; Onus v Alcoa of Australia Ltd (1981) 149 CLR 27, at 35-6 per Gibbs CJ; and ACF, at 527 per Gibbs J, 538 per Stephen J and 547 per Mason J.

18                  What is a sufficient material interest in the subject matter of a proceeding for the purpose of standing?  In ACF, the High Court held that the appellant had no interest in challenging a decision made under regulations affecting foreign exchange.  In explaining the concept of “special interest”, Gibbs J said, at 530:

[A]n an interest, for present purposes, does not mean a mere intellectual or emotional concern.  A person is not interested within the meaning of the rule, unless he is likely to gain some advantage, other than the satisfaction of righting a wrong, upholding a principle or winning a contest, if his action succeeds or to suffer some disadvantage, other than a sense of grievance or a debt for costs, if his action fails.  A belief, however strongly felt, that the law generally, or a particular law, should be observed, or that conduct of a particular kind should be prevented, does not suffice to give its possessor locus standi.

19                  Aickin J also stated, at 511:

In my view the authorities … establish that it is an essential requirement for locus standi that it must be related to the relief claimed.  The ‘interest’ of a plaintiff in the subject matter of an action must be such as to warrant the grant of the relief claimed.  I do not mean that, where the relief is discretionary, locus standi depends on showing that the discretion must be exercised favourably.  What is required is that the plaintiff’s interest should be one related to the relief claimed in the statement of claim.

These observations were approved in Bateman’s Bay, at 266 per Gaudron, Gummow and Kirby JJ and at 282 per McHugh J. 

20                  The subject matter of this proceeding is the Instruction and the statutory provisions to which the Instruction is said to relate, namely, the private trust provisions in Pt 3.18.  These provisions form part of a statutory scheme for the provision of pensions to persons whom the Parliament has determined merit financial assistance.  Neither in these provisions nor elsewhere does the Social Security Act seek to protect the professional, economic, or commercial interests of an advisor to a pensioner or a pension claimant.  In the applicant’s case, it cannot be said that his interest in the subject matter of the proceeding is a sufficient material interest such as to warrant the grant of the relief that he seeks.

21                  The applicant referred to the situation in England.  I doubt, however, that either the decision in Royal College of Nursing of the United Kingdom v Department of Health and Social Security [1981] AC 800 (“Royal College of Nursing”) or the decision in Gillick v West Norfolk and Wisbech Area Health Authority [1986] AC 112 (“Gillick”) really assists him.  The judgment at first instance of Woolf J in Royal College of Nursing [1981] 1 All ER 545 makes it plain that the circumstances of the case were exceptional.  The question for determination was whether a departmental circular was correct in stating that nurses would commit no offence under the Abortion Act 1967 if they assisted a registered medical practitioner with the termination of a pregnancy and acted on his or her instructions.  The College claimed that the statement was wrong, and each party sought declarations as to the legal position of nurses under the Act.  Neither party raised the question of the Court’s jurisdiction to grant a declaration.  In the course of his judgment, however, Woolf J observed, at 547:

The college is an association of nurses incorporated by royal charter and its objects are, inter alia, to further nursing as a profession, to raise standards of nursing care of the sick and infirm, and to represent and protect the professional interests of, amongst others, enrolled and registered nurses.  In furtherance of its objects the college provides for its members advice as to proper nursing practice, including advice as to the law which is relevant to nursing practice.  It also, through the Commercial Union Insurance Co, provides nurses with indemnity insurance to protect them from liability for negligence in the performance of their duties.

22                  Woolf J held, at 551, that the College had standing because of its special responsibilities to nurses, “in providing not only advice but also insurance for its members …”.  On appeal from the Court of Appeal, the House of Lords restored the declaration of the judge at first instance to the effect that the circular issued by the defendant department to the nursing profession did not misstate the law. 

23                  In Gillick, the plaintiff, who was the mother of five girls under sixteen years of age, sought a declaration that guidance contained in a departmental memorandum was unlawful.  Amongst other things, the memorandum referred to the possibility of a child under sixteen years obtaining contraceptive advice from a doctor without parental consent.  In relation to a question of procedure, Lord Scarman (with whom Lord Fraser agreed) stated that, whilst the plaintiff was proceeding against public authorities and the remedy she claimed was in the field of public law, her claim was based upon the allegation of a threat of infringement to her private rights as a parent:  see Gillick, at 163 per Lord Fraser and 178 per Lord Scarman. 

24                  In the present case, the applicant referred particularly to the comments of Lord Bridge, at 193.  Lord Bridge’s comments must be read in full.  At 192-194, his Lordship said:

The issue by a department of government with administrative responsibility in a particular field of non-statutory guidance to subordinate authorities operating in the same field is a familiar feature of modern administration.  The innumerable circulars issued over the years by successive departments responsible in the field of town and country planning spring to the mind as presenting a familiar example.  The question whether the advice tendered in such non-statutory guidance is good or bad, reasonable or unreasonable, cannot, as a general rule, be subject to any form of judicial review.  But the question arises whether there is any exception to that general rule.

Your Lordships have been referred to the House’s decision in Royal College of Nursing v Department of Health and Social Security [1981] AC 800.  The background to that case was exceptional, as only becomes fully clear when one reads the judgment of Woolf J at first instance … .  … .

Against this background it would have been surprising indeed if the courts had declined jurisdiction.  But I think it must be recognised that the decision (whether or not it was so intended) does effect a significant extension of the court’s power of judicial review.  We must now say that if a government department, in a field of administration in which it exercises responsibility, promulgates in a public document, albeit non-statutory in form, advice which is erroneous in law, then the court, in proceedings in appropriate form commenced by an applicant or plaintiff who possesses the necessary locus standi, has jurisdiction to correct the error of law by an appropriate declaration.  Such an extended jurisdiction is no doubt a salutary and indeed a necessary one in certain circumstances, as the Royal College of Nursing case [1981] AC 800 itself well illustrates.  But the occasions of a departmental non-statutory publication raising, as in that case, a clearly defined issue of law, unclouded by political, social or moral overtones, will be rare.  In cases where any proposition of law implicit in a departmental advisory document is interwoven with questions of social and ethical controversy, the court should, in my opinion, exercise its jurisdiction with the utmost restraint, confine itself to deciding whether the proposition of law is erroneous and avoid either expressing ex cathedra opinions in areas of social and ethical controversy in which it has no claim to speak with authority or proffering answers to hypothetical questions of law which do not strictly arise for decision.  (Emphasis added)

25                  The decision in Gillick does not, so it seems to me, assist the applicant in overcoming the absence of his “necessary locus standi”.  I note too, that were the Court to accept the applicant’s invitation to examine the Instruction, it is difficult to see what question of law would properly arise for decision:  cf Electricity Supply Association of Australia Ltd v Australian Competition and Consumer Commission (2001) 189 ALR 109 at 124 [53] and 139-140 [127]-[131] per Finn J; Ainsworth v Criminal Justice Commission (1992) 175 CLR 564, at 582 per Mason CJ, Dawson, Toohey and Gaudron JJ; and Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334, at 355-6 per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ.

26                  In written submissions, the applicant claimed that his

right of standing comes from his professional position which gives him an interest in seeing that policy statements on social security issues accurately reflect the law and his economic interest. 

This professional interest in the proper administration of the Social Security Act is, however, little different from the “mere intellectual … concern” to which Gibbs J referred in ACF, at 530.  A professional interest does not of itself confer standing to challenge the lawfulness of a departmental memorandum of the kind in question in this case.

27                  The applicant sought to avoid this conclusion by reference to the decision in Ogle v Strickland (1987) 13 FCR 306, in which a Full Court of this Court held that the appellants who were “in holy orders in hierarchical Christian churches” were

in a special position compared with ordinary members of the public in that it is their duty and vocation to maintain the sanctity of the Scriptures, to spread the Gospel, to teach and foster Christian beliefs and to repel or oppose blasphemy.  Blasphemy is the denial of the basic tenets of the Christian faith.  The doctrine and teachings of the Christian faith are of ‘great cultural and spiritual significance’ to the appellants (to adopt the language of Stephen J in the Onus case (supra)) and certainly are of no less significance to Christians than were the Aboriginal relics to the Gournditch-jmara community in the Onus case (supra).  The appellants are not meddlers or ‘busy bodies’.  Nor are they people who have mere intellectual or emotional concern about the film.  Their position is therefore different from the position which the High Court perceived the Australian Conservation Foundation to have in the Australian Conservation Foundation case (supra):  see also the judgment of Gibbs CJ in Davis v Commonwealth (1986) 61 ALJR 32.  The decisions impugned in this case have a greater effect upon the appellants than they have upon ordinary members of the public.  It is true that the appellants have no special interests in the subject matter of the decision in the sense of legal or equitable rights or proprietary or pecuniary interests; but they are persons aggrieved because to repel blasphemy is a necessary incident of their vocation.  To deny them standing would deny an important class in the community an effective means and procedure for challenging decisions of the kind involved in this case.  (at 318 per Lockhart J, Fisher J generally agreeing.)

28                  Since opposition to blasphemy was “a necessary incident of their [Christian] vocation”, the appellants were, so the Full Court held, “persons aggrieved” within the meaning of s 5(1) of the ADJR Act by a decision of the Censorship Board to allow the importation into Australia of what the appellants claimed to be a blasphemous film.  The decision in Ogle v Strickland is, plainly enough, distinguishable from the present case.  The applicant does not claim, for instance, that it is a necessary incident of his profession that he oppose every departmental statement concerning the Social Security Act which he considers to be legally erroneous. 

29                  The applicant placed particular reliance on the last sentence of the passage from Ogle v Strickland set out above.  He submitted that there was no person better placed than he to challenge the Instruction.  I reject this submission.  If the respondent were to decided, pursuant to subs 1207V(2) of the Social Security Act, that an individual passed the control test in relation to a trust on the basis that the individual held a beneficial interest (say, 10%) in the corpus or income of the trust and that, in conformity with the Instruction, assets or income were attributable to him or her under Pt 3.18 of the Act, then that individual would clearly have standing to seek judicial review of the decision (and, semble, to pursue statutory rights of review or appeal). 

30                  For present purposes, I accept, as the applicant submitted, that the “deprivation provisions” operated to deter some individuals from acting otherwise than in conformity with the Instruction when dealing with trust interests.  There are, however, numerous matters that may deter an individual from pursuing litigation.  Every properly informed litigant has considered the prospects of success and the possible consequences of failure (including the burden of costs) before commencing proceedings.  Many individuals make what may well be a wise choice not to pursue litigation because of the risk of failure and the consequences that might follow.  This said, however, the risk of failure and its possible consequences have no bearing upon whether such individuals have standing to sue.  Similarly, the standing of a pension claimant to seek judicial review is not diminished merely because there is a risk that he or she might lose, and the deprivation provisions be attracted.  After all, if successful, such a claimant would not be affected by the deprivation provisions at all. 

31                  The applicant’s ‘economic interest’ is also an insufficient material interest for standing purposes.  In effect, what the applicant claims as an interest is a loss of opportunity to derive income from the provision by him of certain advice and other services to persons who no longer want the advice and services on account of the respondent’s Instruction.  An applicant for review does not, however, acquire standing merely because the outcome of his review application, if successful, might afford him some consequential benefit from a third party:  see Maritime Union of Australia v Anderson (2000) 100 FCR 58, at 80.  The same principle has been applied in decisions concerning the expression “person aggrieved” in s 5(1) of the ADJR Act:  see, e.g., BGL Corporate Solutions Pty Ltd v Australian Prudential Regulation Authority (1999) 55 ALD 643 at 646 per Heerey J; Corio Bay and District Private Hospital NH Pty Ltd v Minister for Family Services (1998) 157 ALR 181 at 189-190 per Merkel J; and Big Country Developments Pty Limited v Australian Community Pharmacy Authority (1995) 60 FCR 85 at 94 per Lindgren J.

32                  In any event, I doubt that the applicant’s so called economic interest is in truth a relevant economic interest for the purposes of standing.  The Instruction does not purport to deprive the applicant of business; and it does not affect the applicant’s capacity to provide advice to his clients on the operation of Pt 3.18 of the Social Security Act, though it may affect the content of the advice that he provides.  If, as the applicant contends, the Instruction does not accurately reflect the effect of Pt 3.18, then the applicant may so advise his clients.  Should his clients restructure their affairs inconsistently with the Instruction, the restructuring may be effective if the Instruction is shown, in review proceedings brought by a person whose interests are relevantly affected, to be wrong. 

33                  This circumstance is, perhaps, analogous to the difficulty that was said to face the appellant in Yates Security Services Pty Ltd v Keating (1990) 25 FCR 1 (“Yates”).  In Yates, a Full Court of this Court held that the appellant had no special interest for standing purposes to challenge by way of judicial review a Ministerial decision under s 30 of the Australian Heritage Commission Act 1975 (Cth).  The appellant asserted that, if it were successful on review, it would gain a commercial benefit “by opening the door … to negotiate for the acquisition and development of the [Paddy’s Market] site”:  Yates, at 13.  In rejecting this submission, Lockhart J said, at 14:

In my opinion the ability to negotiate for the acquisition and development of the site, even if it is a commercial benefit, is one which Yates has whether it wins this case or not.  Like any other member of the public it may negotiate for the acquisition and development of the site.  The Treasurer’s order of revocation places no impediment on Yates negotiating with Rockvale to acquire Paddy’s Market and to negotiate with the Darling Harbour Authority to develop the site.  The evidence does not establish that Yates has a special interest in the subject matter of the proceedings.  Therefore it has no standing to bring it.

34                  Morling J (at 20-21) and Pincus J (at 30) reached the same, or a similar conclusion.  Morling J observed, at 21:

In my opinion, since success in the litigation will not confer upon Yates any commercial benefit it must follow that it does not have standing to bring the present proceedings.

35                  In the present case, if the applicant were granted the relief he seeks, the relief would not confer any economic benefit on him directly.  At most, so far as the applicant is concerned, if successful, he could proffer advice that was different from the advice he presently gives; and, in consequence, according to him, he would receive more remuneration.  If this latter matter were a relevant interest (which, for the reasons stated at [20] above, it is not) it is too remote from the subject matter of this proceeding to be regarded as a sufficient material interest to give the applicant requisite standing.

conclusion

36                  For the reasons stated above, the respondent’s objection to competency should be upheld, and the amended application dismissed as incompetent.  I would give the parties an opportunity to be heard on the question of costs.

Associate:

Dated:              22 August 2002