Consideration
38 In considering these submissions I also take into account what the learned authors of Judicial Review of Administrative Action and Government Liability said at [2.590], as follows, adding the footnotes into the text:
One of the pre-Tang denials of AD(JR) coverage had concerned a department head's refusal to grant compensation for the department's maladministration. [Smith v Oakenfull (2004) 134 FCR 413 at 418-421.] The compensation scheme was non-statutory, but the Act gave the department head the responsibility of managing the department's funds. Applying Tang's criteria, there might well be AD(JR) coverage of a decision to grant compensation, because such a decision would provide statutory authority for making the payment. AD(JR) coverage of a decision going the other way, however, may be doubted, because it cannot be said to have generated new rights or obligations, or affected existing rights or obligations. AD(JR)'s definition of "decision" includes refusals, [Section 3(2)(g)] but Tang's second criterion means that the only refusals that AD(JR) covers are those that create or affect rights or obligations, and even then, only if that effect can be sourced to statute.…
39 Before going to Tang, I shall consider briefly the other authorities on which the parties relied.
40 With respect, I find little of assistance in Remuneration Planning which appears to have turned on the form of the ruling in question, a public ruling, being "not directed to any particular person or persons" and being "purely advisory in the sense that it notifies the public of the opinion of the Commissioner upon the question of taxation involved. It does not affect rights or liabilities in a sense necessary to found curial intervention.": see the judgment of Gyles J at [11]. On this basis, Gyles J said part of the difficulty was a question of locus standi and also there was "no proper subject for a writ of mandamus or prohibition and nothing to properly injunct to bring the matter within s 39B(1), and there is no matter arising under any law made by the Parliament within the meaning of s 39B(1A)." It was in that context, in my opinion, that his Honour said that private rulings do affect individual taxpayers and, by implication, that public rulings did not. I note that it does not appear that the application in Remuneration Planning involved the ADJR Act.
41 The decision in Remuneration Planning was considered in Albrecht where a litigant in person had claimed that the "Australian Taxation Office went beyond their powers, which is to administer the Tax Act, by using this Public Ruling [TR 2010/3] to legislate on Division 7A." The plaintiff sought "costs and damages". Pritchard J, as her Honour then was, said at [27] that the Supreme Court of Western Australia's jurisdiction "does not extend to a supervisory jurisdiction with respect to decisions of the Commonwealth executive government." There was also a substantive difficulty, Pritchard J said, referring to Remuneration Planning. Her Honour appears, at [29], to have approved the approach of Gyles J that the public ruling was purely advisory and that if persons were assessed for taxation on the basis of an application of the legislation as outlined in such a ruling the appropriate course for relief was to appeal against the assessment. In my opinion, with respect, Albrecht takes the matter no further.
42 Barkworth Olives concerned an application for an order of review under the ADJR Act in relation to the applicant's application for a public ruling. The respondent Commissioner filed a notice of objection to competency alleging, amongst other things, that the conduct sought to be reviewed or the purported decision identified by the applicant was not conduct for the purpose of a decision, or a decision, to which the ADJR Act applied. Spender J held, at [22], that the applicant's complaints were not, in any relevant sense, reviewable as "conduct" under the ADJR Act. At [26], Spender J said that there was never a decision by the Commissioner to issue a draft ruling which accompanied the covering letter in question as a public ruling. At [27], Spender J said that the view expressed in the draft ruling was not a "public ruling", nor was it a proposed public ruling, in the absence of any intention by the Commissioner to publish it in the Gazette. At [40], his Honour said it was unnecessary, in the light of his reasons, to make particular findings on the notice of objection to competency. In my opinion, with respect, Barkworth Olives is of no present assistance.
43 Carey v Field involved a proceeding under the ADJR Act to set aside a decision made on behalf of the Commissioner of Taxation to withdraw a product ruling. The product ruling was a public ruling. Merkel J referred, at [4], to the binding effect of a public ruling, provided for at that time in s 170BA(3) of the Income Tax Assessment Act 1936. Although in Remuneration Planning the provision equivalent to s 170BA(3) was set out, at [6], being at that time s 74A(2) of the Fringe Benefits Tax Assessment Act 1986 (Cth), it was not necessary for Gyles J to consider that provision in light of his Honour's reasoning: see [40] above. Albrecht' and Barkworth Olives appear to contain no such reference.
44 At [38], Merkel J noted that a request was made to the Australian Taxation Office pursuant to s 13 of the ADJR Act and reasons for the decision were subsequently given by the respondent. It is not necessary for present purposes to go into the grounds of judicial review except to note that the applicant succeeded in respect of the procedural errors of which he had complained but failed in respect of the substantive errors.
45 At [56], Merkel J said the following:
The Commissioner conceded that he was obliged to comply with the rules of natural justice in relation to his decision to withdraw the Product Ruling. The concession was plainly correct. It is now well established that when a statute confers power on a public official to destroy, defeat or prejudice a person's rights, interests or legitimate expectations, the rules of natural justice regulate the exercise of that power unless they are excluded by plain words of necessary intendment: see Annetts v McCann (1990) 170 CLR 596 at 598. In the present case the statute conferred a power upon the Commissioner to defeat the right of members of the class of persons to whom the public ruling was intended to apply, to rely on the Commissioner being bound by the ruling in accordance with s 170BA(3) of the ITA Act 1936. The right that can be defeated by the withdrawal of the ruling is a legal right arising under the statute. It is not a mere indirect and consequential financial interest: cf Corio Bay and District Private Hospital NH Pty Ltd v Minister for Family Services (1998) 87 FCR 37 at 43 and 47.
I note the concession and that Merkel J said that the concession was plainly correct, but I also note that no issue was raised in that case that the ADJR Act did not apply.
46 All of these cases were decided before Tang, to which I now return.
47 Tang concerned a decision to exclude Ms Tang from the PhD candidature program conducted by Griffith University. The question was whether the decision to exclude her was a decision "under an enactment", the relevant enactment being the Griffith University Act 1998 (Qld).
48 In Tang the respondent had not pleaded a contract and the plurality said, at [91], given the manner in which she had framed her application for judicial review, there had subsisted between the parties no legal rights and obligations under private law which were susceptible of affection by the decisions in question. There was at best a consensual relationship, the continuation of which was dependent upon the presence of mutuality. That mutual consensus had been brought to an end, but there had been no decision made by the University under the University Act. Nor would there have been such a decision had the respondent been allowed to continue in the PhD program. Thus, it appears, the decision was referable to a private law source and the decision was not "made under" the enactment in question: see the judgment of the plurality at [81]. The enactment appeared to do no more than provide a capacity: the enactment did not play a relevant part in the legal force or effect of the decision.
49 In Tang at [10] Gleeson CJ said it was not enough that the decision was within power. A decision met the test "only if it is one for the making of which the relevant statute either expressly or impliedly provides and one to which the statute gives legal force or effect", citing Lehane J in Australian National University v Lewins (1996) 68 FCR 87 at 101.
50 In Tang at [89] and [96], per Gummow, Callinan and Heydon JJ, it was established that:
The determination of whether a decision is "made … under an enactment" involves two criteria: first, the decision must be expressly or impliedly required or authorised by the enactment; and, secondly, the decision must itself confer, alter or otherwise affect legal rights or obligations, and in that sense the decision must derive from the enactment. A decision will only be "made … under an enactment" if both these criteria are met. It should be emphasised that this construction of the statutory definition does not require the relevant decision to affect or alter existing rights or obligations, and it will be sufficient that the enactment requires or authorises decisions from which new rights or obligations arise. Similarly, it is not necessary that the relevantly affected legal rights owe their existence to the enactment in question. Affection of rights or obligations derived from the general law or statute will suffice.
…
The decisions of which the respondent complains were authorised, albeit not required, by the University Act. The Committees involved depended for their existence and powers upon the delegation by the Council of the University under ss 6 and 11 of the University Act. But that does not mean that the decisions of which the respondent complains were "made under" the University Act in the sense required to make them reviewable under the Review Act. The decisions did not affect legal rights and obligations. They had no impact upon matters to which the University Act gave legal force and effect. The respondent enjoyed no relevant legal rights and the University had no obligations under the University Act with respect to the course of action the latter adopted towards the former.
51 In the present case, the legislation deals specifically with the power to make a public ruling: s 358-5. The applicant applied for a public ruling in relation to its timber project. The statute set out, in s 357-60, when such a ruling bound the Commissioner. The purpose of applying for the ruling and the effect of the ruling if granted was that the risks of uncertainty when the applicant was self assessing or working out its tax obligations or entitlements was reduced by protecting it from increases in tax and from penalties and interest where it relied on the ruling: see s 357-5. The ruling, if made by the Commissioner, bound the Commissioner if it applied to the applicant and the applicant acted in accordance with it. As explained by the guide in s 357-1, if the applicant acted in accordance with the ruling and the law turned out to be less favourable to the applicant than the ruling provided, the applicant was protected by the ruling from any adverse consequences.
52 It follows that a ruling does not have as its only connection with the statute that it flows from a general description of the Commissioner's functions: compare Tang at [8] per Gleeson CJ.
53 In my opinion it would be one thing if the decision to decline to make a ruling was referable only to s 8 of the Income Tax Assessment Act 1936 (Cth) vesting the "general administration" of that Act in the Commissioner. As noted by Edmonds J in Macquarie Bank Ltd v Commissioner of Taxation [2013] FCA 887 at [76] that provision does not include a power to make decisions that create, extinguish or modify the legal rights of taxpayers.
54 Legal rights and obligations under private law are not in issue. What is in issue is the applicant's access to a statutory regime which may affect the incidents of another statutory regime, the taxing regime, on the applicant or the entities or class of entities the subject of the application for the ruling.
55 Neither is an exercise of the power in s 358-5 to make a ruling a mere grant of authority to do that which under the general law a person has authority to do.
56 In the present case the decision is not to exercise a statutory power with statutory consequences. In my opinion, the character of the decision, and its legal effect, is to exclude the applicant from the statutory benefits to which it may have had access if the ruling had been made.
57 No doubt the statutory power in s 358-5 involves a discretion, but the definition of "decision to which this Act applies" in s 3(1) the ADJR Act specifically states that it applies to a decision of an administrative character made "whether in the exercise of a discretion or not".
58 Further, in my opinion, deciding not to exercise the statutory discretionary power amounts to "doing or refusing to do any other act or thing" within s 3(2)(g) which is to be treated as within the language of "making of a decision": see s 3(2) of the ADJR Act.
59 This is not to say that all exercises of power by the Commissioner under s 358-5 would be amenable to statutory judicial review under the ADJR Act. As the plurality in Tang said at [64], "there is involved a question of characterisation of the particular outcome which founds an application for review under the statute."
60 Tang did not concern a decision not to exercise a power. In my opinion, the High Court did not intend to qualify the approach in Right to Life Association (NSW) Inc v Secretary, Department of Human Services & Health [1995] FCA 33; 56 FCR 50. In that case, Lockhart J, Beaumont J and Gummow J held that the Secretary's letter, received on 31 August 1994, refusing to exercise his authority under the Regulations to direct that the use of a drug for clinical trials should cease, was a reviewable decision under the ADJR Act. Lockhart J said, at 62:
In the present case, the appellant brought various matters to the attention of the Secretary bearing upon the question of the legality under State law of the conduct or continuation of the trials with respect to the drug mifepristone. The Secretary regarded them as relevant and reached a conclusion in my view that he would not give a direction under condition (e)(ii) to stop the trials. That is the sensible and practical analysis of the Secretary's letter received on 31 August 1994. If the Secretary had reached the opposite conclusion, namely, that to continue the trials would be contrary to the public interest and that a direction should be given to stop them, and thereupon gave that direction, surely that must be a reviewable decision under the ADJR Act. The sponsor would clearly be a person aggrieved and would in my view be entitled to seek a review of the decision under the ADJR Act. Why should the position be different if the Secretary reaches the opposite conclusion, as he did in this case? The answer does not lie in my opinion in the mere form of condition (e)(i) as to absence of awareness on the part of the Secretary and the absence of a direction under condition (e)(ii). By saying in the letter received on 31 August that "I have been presented with no evidence that this condition is not being met" (3rd par, last sentence) and "You have raised nothing which would warrant my acting to stop the trials" (4th par, last sentence), he made a decision refusing to give a direction under condition (e)(ii) of Item 3. In the ADJR Act, a reference to the making of a decision includes a reference to doing or refusing to do a relevant act or thing (ADJR Act, s 3(2)(a), (b) and (g)). It was a decision which had "the character or quality of finality"; it was an ultimate or operative decision: Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 per Mason CJ at 336 and 338. See also General Newspapers Pty Ltd v Telstra Corporation at 170 per Davies and Einfeld JJ.
Gummow J said at 87-88:
The present litigation turns principally upon the remaining condition, condition (e). The primary judge held that the decision which attracted the operation of s 5(1) of the ADJR Act was made under condition (e)(ii).
The text of condition (e) is as follows:
"(e) the Secretary must not, at any time:
(i) have become aware that to conduct or continue the trial would be contrary to the public interest; and
(ii) have directed that the trial not be conducted, or be stopped."
Condition (e) may operate upon the exemption conferred by reg 12(1A) and s 18(1), both as a condition precedent and a condition subsequent. It may operate before the conduct of the trial has commenced, with the result that the trial never takes place, or it may serve to bring to an end the trial whilst it is under way.
The terms of condition (e) are not expressed so as to confer any power upon the Secretary to direct that the trial not be conducted or be stopped. The condition for the continuance of the exemption is that the Secretary has not given such a direction. However, I am prepared to construe the Regulations on the footing that a grant of power to give such a direction necessarily is implicit in condition (e): see Minister for Immigration and Ethnic Affairs v Mayer (1985) 157 CLR 290 at 302-303. However, what is implied is power to give the direction, if the Secretary has become aware that to conduct or to continue the trial would be contrary to the public interest.
It follows that a decision to direct that a trial not be conducted or be stopped is made under the Regulations. Likewise, a refusal to make such a direction is, relevantly, a decision under that enactment for the purposes of s 5(1) of the ADJR Act.
See also Beaumont J at 80.
61 Australian National University v Lewins (1996) 68 FCR 87 concerned a decision not to promote the applicant to the position of Reader. As noted by Davies J, at 91, it was not in dispute that the refusal to recommend that Mr Lewins' application for appointment as Reader be accepted had the necessary characteristics of a "decision", provided it was made under an enactment. Davies J said, at 92, that where the decision of the Promotions Committee effectively brought Mr Lewins' application for promotion to the level of Reader to an end, it not having been recommended, there was a sufficient element of finality or conclusiveness for the Committee's act to constitute a reviewable decision.
Lehane J said, at 98-99:
There is no doubt or dispute that, if the decision not to promote the appellant is one to which the Act applies, the appellant is a person aggrieved by the decision.
There is also no doubt or dispute that the decision not to recommend the appellant for promotion (which in practical terms amounted to a decision that he would not be promoted) was a decision of an administrative character. The issue between the parties is, thus, whether it was a decision made under an enactment.
Kiefel J, at 96, agreed with Lehane J.
It is to be recalled that in Tang the High Court referred with approval to the judgment of Lehane J in Lewins on the topic of "made under an enactment": see per Gleeson CJ at [10] and Gummow, Callinan and Heydon JJ, particularly at [78] and [80]-[81].
62 In my opinion, the better view is that Tang does not decide that where an administrative decision to exercise a statutory power is "made… under an enactment" a decision not to exercise that statutory power is not "made… under an enactment" because it cannot be said to have generated new rights or affected existing rights. I regard Eastman v Besanko as clearly distinguishable, by reason of the terms of s 425 of the Crimes Act, the legislative history and the intention of the legislature: see [27]-[35] above.
63 For these reasons I do not, with respect, share the doubt expressed by the learned authors of Judicial Review of Administrative Action and Government Liability at [2.590] which I have set out at [38] above. In my view a decision to exercise a statutory power is not to be regarded as an abstract exercise and, likewise, a decision not to exercise a statutory power should be regarded as the obverse, for these purposes, of a positive decision in the applicant's favour. Regard must be had to the terms of the application. In that way the decision not to exercise the statutory power to make a ruling may be seen as authorised by the enactment and affecting legal rights and in that sense deriving from the enactment: see Tang at [89].
64 I find that in the circumstances of the present case the decision not to make a ruling was and is a decision to which the ADJR Act applies.