Federal Court of Australia

Civil Aviation Safety Authority v Sky High Helicopters Pty Ltd [2026] FCA 1683

ORDERS

THE COURT ORDERS:

1.    Pursuant to section 30DE(2) of the Civil Aviation Act 1988 (Cth), the respondent is prohibited from doing anything that is authorised by Air Operator’s Certificate Number CASA.AOC.0469 and Aerial Work Certificate Number CASA.AWK.0399 held by the respondent but which, without those authorisations, would be unlawful for the respondent to do, until midnight on 19 November 2026.

2.    The respondent’s interlocutory application dated 27 October 2026 is dismissed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

Delivered ex tempore

THAWLEY J:

Introduction

1    The Civil Aviation Safety Authority (CASA) has applied under s 30DE(1) of the Civil Aviation Act 1988 (Cth) (CAA) for an order under s 30DE(2) prohibiting Sky High Helicopters Pty Ltd from doing anything that is authorised by two authorisations held by Sky High that, without those authorisations, would be unlawful.

2    The two authorisations held by Sky High are: an Air Operator’s Certificate (AOC) authorising air transport operations in rotary wing aircraft in accordance with Part 133 of the Civil Aviation Safety Regulations 1998 (Cth) (CASR); and an Aerial Work Certificate (AWC) authorising aerial work activities in rotary wing aircraft in accordance with Part 138 of the CASR.

3    The parties have reached an agreed position that an order should be made under s 30DE(2), effective until midnight on 19 November 2026.

4    As is made clear by the terms of s 30DE(2), neither Sky High’s consent, nor the parties’ agreed position, relieves the Court of the obligation to be satisfied that there are reasonable grounds to believe that Sky High has engaged in, is engaging in, or is likely to engage in, conduct that contravenes s 30DB.

5    Further, as is made clear by the terms of s 30DE(4), the Court must be satisfied that the order is made only for the period of time the Court considers reasonable to allow CASA to complete an investigation into the circumstances that gave rise to CASA’s decision to suspend the AOC and AWC. CASA’s decision to suspend those authorisations was made on 22 October 2026, when it issued a notice under s 30DC of the CAA.

Legislative framework

6    Section 30DB of the CAA prohibits the holder of a civil aviation authorisation from engaging in conduct that constitutes, contributes to or results in a serious and imminent risk to air safety.

7    Where CASA has reason to believe that a holder has engaged in, is engaging in, or is likely to engage in, such conduct, it may suspend the authorisation by written notice: s 30DC(1).

8    A suspension under s 30DC(1) ends at the end of the fifth business day after the day on which the holder was notified of the suspension, unless before that time CASA makes an application to this Court under s 30DE(1): s 30DC(3). The suspension generally continues until CASA’s application is withdrawn or determined by the Court: s 30DJ. It is therefore necessary to the legislative scheme that such applications be determined expeditiously.

9    If CASA applies under s 30DE(1), and the Court is satisfied that there are reasonable grounds to believe that the holder has engaged in, is engaging in, or is likely to engage in, conduct that contravenes s 30DB, the Court must make an order prohibiting the holder from doing anything authorised by the authorisation: s 30DE(2). If the Court is satisfied about the matters in s 30DE(2), it has no discretion to refuse the order: Civil Aviation Safety Authority v Bell [2008] FCA 1049 at [7].

10    In making a decision under s 30DE(2), the Court must have regard to ss 3A and 9A(1): s 30DE(3); see also: Civil Aviation Safety Authority v Alligator Airways Pty Ltd [2012] FCA 601 at [136]–[137]. Those provisions state:

3A  Main object of this Act

The main object of this Act is to establish a regulatory framework for maintaining, enhancing and promoting the safety of civil aviation, with particular emphasis on preventing aviation accidents and incidents.

9A  Performance of functions

(1)     In exercising its powers and performing its functions, CASA must regard the safety of air navigation as the most important consideration.

11    In assessing risk, the Court may be guided by the standards for air safety in the relevant regulations: Civil Aviation Safety Authority v Boatman [2004] FCAFC 165 at [49]. Even if the Court were to take the view that a serious and imminent risk to air safety was not affirmatively proved on the balance of probabilities, the Court would nevertheless be cautious, if there were some evidence of relevant matters for concern, before concluding that there is no reasonable ground for belief: Civil Aviation Safety Authority v Boatman [2006] FCA 460 at [24]; see also: Bell at [7], citing George v Rockett [1990] HCA 26; 170 CLR 104 at 116. This is because the legislation contemplates further investigation by CASA, implying that a decision may well need to be made on incomplete materials.

12    Observations concerning the meaning of the phrase “serious and imminent risk to air safety” have been made in a number of cases – see, for example: Boatman 2006 at [31], [32], [42]–[45], [54], [55]; Alligator Airways at [40], [41], [44], [50]–[59]. It is unnecessary for present purposes to repeat or summarise those various observations. The statutory language is clear.

13    If the Court makes an order under s 30DE(2), that order must continue in force for the period the Court determines when making the order, not being more than 40 days, that it considers reasonable to allow CASA to complete an investigation into the circumstances that gave rise to CASA’s decision to suspend the authorisation: s 30DE(4).

Sky High’s conduct

14    CASA commenced an investigation into Sky High in March 2026: Healy at [9]. Sky High conducts at least some of its commercial operations under the name Fortescue Helicopters: Healy at [11]. No key personnel, pilots, or other staff members were interviewed as part of this investigation: Healy at [20]. This investigation resulted in a preliminary investigation report dated 17 April 2026, which identified non-compliant conduct: Healy at [27].

15    On 22 May 2026, CASA issued Sky High with a show cause notice.

16    On 29 May 2026, CASA decided that a further investigation into Sky High should be performed by interviewing the pilots and former pilots of Sky High: Healy at [29]. The purpose of this second investigation was to determine the circumstances in which the non-compliant conduct identified in the initial investigation had occurred.

17    Sky High responded to the show cause notice in writing on 31 May 2026 and again on 28 August 2026: CLS-1 at 5.

18    The second investigation revealed material which, in the view of CASA’s Section Manager Investigations, Legal Division, showed that (Healy at [29]):

(a)    Sky High had engaged in serious breaches of aircraft airworthiness, including the unauthorised conduct of maintenance and the failure accurately and correctly to record flight hours and maintenance defects on aircraft maintenance releases by pilots;

(b)    Sky High had engaged in the intentional altering, changing and falsifying of company records of flight data, flight and duty times, training and the control of maintenance by operations staff of Sky High;

(c)    key personnel (being the Chief Executive Officer, the Head of Flight Operations, the Head of Operations and the Head of Aircraft Airworthiness and Maintenance Control) failed in their duties adequately to oversee operations of Sky High staff based at various remote locations around Australia;

(d)    aircraft were regularly operated with maintenance defects that were not recorded, maintenance faults which were not rectified, and the use of “snag lists” (being an unrecorded list of maintenance defects);

(e)    Sky High staff were directed by its key personnel not to record maintenance defects on aircraft maintenance releases;

(f)    the Head of Training and Checking for Sky High performed pilot examinations that he was not approved to conduct, and endorsed pilot flight crew licences that he was not approved to endorse;

(g)    Sky High operated a permanent base from Horn Island in the State of Queensland (reported by Sky High to the Australian Transport Safety Bureau in the course of an investigation into an aviation incident) that was not (and was required to be) listed in Sky High’s exposition/operations manual; and

(h)    aircraft were regularly modified with Light Detection and Ranging equipment without: (i) approval for the modification; or (ii) any record of the modification having been made in the aircraft’s maintenance release.

19    On 12 October 2026, CASA issued a supplementary investigation report: Healy at [31]. The 12 October 2026 investigation report focused on alleged breaches occurring between 1 July 2024 and 30 September 2025.

20    On 22 October 2026, CASA suspended Sky High’s authorisations under s 30DC of the CAA. CASA brought these proceedings on 23 October 2026, within the time required by s 30DE(1).

21    The matter came before the duty judge and was subsequently allocated to me for an expedited hearing.

22    At the hearing today, CASA relied on affidavits from: Ms Carol Swain, Acting Section Manager in CASA’s Litigation team; Mr David Punshon, a manager in the Continued Operational Safety, Airworthiness and Engineering Branch; Mr Russell Dyer, National Manager Surveillance in the Regulatory Oversight Division; and Mr Travis Healy, Section Manager Investigations in the Legal Division.

23    Mr Dyer considers that CASA’s investigations identified strong grounds to believe that Mr Weldon Percy, Sky High’s director and Chief Executive Officer, presided over, and in many instances directed, a deliberately non-compliant safety culture where (Dyer at [46]):

(a)    pilots were directed to under-record the total time in service of aircraft;

(b)    pilots were directed not to record maintenance defects on aircraft maintenance releases;

(c)    pilots were directed to fly aircraft with outstanding maintenance;

(d)    unauthorised personnel were required to perform maintenance tasks on aircraft;

(e)    aircraft were not operated or maintained in accordance with the manufacturer’s instructions; and

(f)    flight and duty time limitations applicable to pilots in order to manage fatigue were routinely exceeded.

24    Mr Dyer’s evidence included the following explanations:

(a)    The system of aviation safety established under civil aviation legislation relies on a range of inter-connected safety defences which combine to ensure that the risks associated with flying aircraft are reduced to as low as reasonably practicable: Dyer at [47];

(b)    Organisational safety is a key safety defence relied upon by the regulatory system to ensure an acceptable level of safety. Organisational safety refers to the organisational capability of air operators such as Sky High to utilise internal systems, procedures and staff supervisory arrangements to control their authorised aviation activities in a way which ensures aviation safety. The ability of an operator to ensure regulatory compliance is a key indicator of that organisational capability: Dyer at [48];

(c)    Where, as appeared to Mr Dyer to be the case here, an operator has engaged in a deliberate course of non-compliant conduct resulting in the “systematic” dismantling of important safety controls, the risks to aviation safety associated with that operator’s operations are escalated to an unacceptable degree: Dyer at [49].

25    Mr Dyer stated that, of most concern to him, was (Dyer at [50]):

(a)    the apparently deliberate non-compliance by Sky High with key elements of the aircraft airworthiness control framework established by aviation legislation. Mr Dyer’s view was that such conduct increases the risk that unairworthy aircraft are being used in Sky High’s operations and that, in turn, seriously and unacceptably increases the risk of an inflight system or component failure which has the very real potential to result in a serious aircraft incident or accident;

(b)    the apparent non-compliance by Sky High with the flight and duty limitations applicable to pilots, which, in his view, seriously and unacceptably increases the risk that pilots will fly aircraft while adversely affected by fatigue. Mr Dyer observed that the negative impact of fatigue on human performance is well known and, in his experience, pilot fatigue has been a contributing factor to many aircraft accidents and incidents.

26    In Mr Dyer’s view, the exposure to risk arises on every flight, and the risk might materialise at any time: Dyer at [53]. CASA has reviewed only 10 of the more than 20 aircraft operated by Sky High, so that the airworthiness of the remainder is unknown: AS at [99].

27    Mr Dyer, who recommended that CASA suspend the AOC and AWC, considered that there are reasonable grounds to believe that:

(a)    Sky High has engaged in a premeditated and “systemic” course of conduct designed to prevent its pilots from complying with their, and Sky High’s, obligations in relation to the recording and reporting of defects, the recording of flight hours on aircraft maintenance releases, the performance of maintenance without the required approvals, and the operating of aircraft when maintenance is outstanding;

(b)    Sky High is non-compliant with flight and duty limitations applicable to its operations in accordance with regulation 210A of the Civil Aviation Regulations 1988 (Cth);

(c)    the CEO, Mr Percy, has unlawfully purported to endorse Sky High’s pilots to fly a Robinson R66 helicopter; and

(d)    the non-compliant conduct is actively encouraged by the senior management of Sky High, or at the least has been directed and orchestrated by Mr Percy.

28    CASA’s evidence included statements which it had obtained from three pilots: TH-11 to TH-13. CASA had also spoken to other pilots who were not prepared to give statements. Some pilots declined to participate. It also spoke to other employees.

29    Sky High did not object to any of the evidence adduced by CASA. It relied on an affidavit from Mr Percy in which he:

(a)    denies that there is any serious and imminent risk to air safety;

(b)    says that a show cause notice dated 12 August 2025 was withdrawn on 23 October 2025;

(c)    claims that Sky High has comprehensively addressed issues raised in the show cause notice dated 22 May 2026;

(d)    says that many of the matters raised in the s 30DC notice dated 22 October 2026 should not have been included and that a response has already been provided to certain other issues; and

(e)    challenges the reliability of statements made by former pilots, described by him as “disgruntled”: Percy at [26]–[33].

30    Mr Percy’s affidavit included a copy of the suspension notice dated 22 October 2026 which he annotated with responses to the many issues raised by CASA: Percy at pages 125–61. He asserts that non-compliant conduct “does not equal not safe”. He describes the three pilots who provided statements as incompetent and disgruntled. He refers to 11 interviews carried out by CASA which he says were with disgruntled former employees, some of whom “broke serious laws themselves”: Percy at pages 128, 136.

31    Mr Percy described the overflying of one of the aircraft with maintenance due as a failure attributable to the incompetence of a licensed aircraft maintenance engineer used by Sky High since April 2024 and the incompetence of one of the disgruntled pilots: Healy at page 106; Percy at page 143.

32    It is relevant that, on 23 October 2026, after Sky High had been notified of the suspension effected by the s 30DC notice, and it had engaged a lawyer in relation to the notice, Sky High conducted commercial flights with one helicopter (VH-DKU), in breach of the suspension notice, carrying passengers who were then unaware of the suspension: Healy at [51]–[54]. The passengers became aware of the suspension and ceased continuation of further flights. That matter is relevant in assessing Sky High’s culture and issues of risk.

Consideration

33    The alleged matters of non-compliance set out in the evidence are extensive. As mentioned, the 12 October 2026 investigation report focused on alleged breaches occurring between 1 July 2024 and 30 September 2025. Breaches that are systematic and deliberate may indicate a real risk that serious and imminent harm is likely to occur: Alligator Airways at [128]. It is not necessary to resolve on a final basis whether the matters of non-compliance raised by CASA were deliberate or whether CASA or Mr Percy is correct about the significance of the matters raised. The question is whether, on the material, the Court is satisfied that there are reasonable grounds to believe that the holder has engaged in, is engaging in, or is likely to engage in, conduct that contravenes s 30DB.

34    Having regard to the totality of the evidence and material before the Court, I am satisfied that there are reasonable grounds to believe that the holder of the AOC and AWC has engaged in, is engaging in, or is likely to engage in, conduct that contravenes s 30DB, in that the conduct constitutes, contributes to or results in a serious and imminent risk to air safety. Accordingly, the Court must make an order that prohibits Sky High from doing anything that is authorised by its AOC and AWC that, without the authorisation, would be unlawful.

Timing of suspension

35    The purpose of the suspension, both initially and as continued by an order of the Court, is to prevent the holder from exercising the rights conferred by the authorisation while CASA completes its investigation: Boatman 2004 at [36].

36    The parties have agreed that the order should continue until midnight on 19 November 2026. Counsel for Sky High confirmed that Sky High would provide full co-operation to CASA to complete its investigation within that time. On the basis of the parties’ agreement, and having regard to the material before the Court and Sky High’s expression of co-operation with CASA, I consider that time a reasonable period to allow CASA to complete an investigation into the circumstances that gave rise to CASA’s decision on 22 October 2026 to suspend Sky High’s AOC and AWC.

Conclusion

37    For these reasons, I am satisfied that the order proposed by the parties should be made.

Associate:

Dated:    9 November 2026