[T]he expression 'improper purpose' does not necessarily connote a purpose which is corrupt, immoral or lacking in probity. Rather, it connotes a purpose which is ulterior or extraneous in the sense that it is beyond the scope of the purposes for which the relevant power is conferred (see, for example, Thompson v Randwick Corporation [1950] HCA 33; (1950) 81 CLR 87, 106 (Williams, Webb & Kitto JJ)). Accordingly, where the relevant power derives from legislation, the purposes for which the power has been conferred will be derived by a process of construction of the legislation: see R v Toohey; Ex Parte Northern Land Council [1981] HCA 74; (1981) 151 CLR 170, 186 (Gibbs CJ), 233 (Aickin J).
The ulterior purpose need not be established to be the sole purpose for the exercise of the power. It will be sufficient if it is established that the purpose is a substantial purpose, in the sense that the power would not have been exercised but for the ulterior or extraneous purpose: Thompson v Randwick, 106; see also Re Minister for the Environment; Ex Parte Elwood [2007] WASCA 137 [173].
The party impugning the exercise of power on the basis of improper purpose bears the onus of establishing such a purpose (Municipal Council of Sydney v Campbell [1925] AC 338 at 343; Industrial Equity Ltd v DCT [1990] HCA 46; (1990) 170 CLR 649, 671 (Gaudron J)). In the absence of evidence establishing improper purpose or displacing all possible legitimate purposes, it will be presumed that the power was exercised for a purpose falling within the scope of the purposes for which the power was conferred.
An improper purpose will not lightly be inferred. If the purpose for which the power was exercised must be ascertained by inference from other facts, the presumption of regularity will be applied, so that the inference of improper purpose will only be drawn if the evidence cannot be reconciled with the proper exercise of the power (Industrial Equity Ltd, 672 (Gaudron J)).
There are some authorities which draw a distinction between a substantial purpose, in the sense in which that term is used in the decision in Thompson v Randwick, to which I have referred, and a "dominant" purpose (see, for example, Haneef v Minister for Immigration and Citizenship [2007] FCA 1273 ; (2007) 161 FCR 40 [287]). However, at this stage of these proceedings, it is unnecessary to determine whether there is any material distinction between a test cast in terms of substantial or dominant purpose. It is sufficient for present purposes to observe that the purpose must have motivated the exercise of the power, in the sense that the power would not have been exercised but for the existence of that purpose or motive [24] - [27].