relevant principles
34 Section 25(1) of the Administrative Appeals Tribunal Act 1975 (Cth) (AAT Act) relevantly provides:
Enactment may provide for applications for review of decisions
(1) An enactment may provide that applications may be made to the Tribunal:
(a) for review of decisions made in the exercise of powers conferred by that enactment; or
(b) for the review of decisions made in the exercise of powers conferred, or that may be conferred, by another enactment having effect under that enactment.
35 Both the NVR Act (s 203) and the ESOS Act (s 169AG) provide that applications may be made to the Tribunal for review of reviewable decisions under those Acts. It is not controversial that the NVR Act and the ESOS Act are enactments providing for applications to the Tribunal within the meaning of s 25(1) of the AAT Act, or that the relevant decisions of ASQA were reviewable decisions properly the subject of applications to the Tribunal.
36 In reviewing such decisions, it is clear that the Tribunal stands in the shoes of the original decision-maker - in this case ASQA. One need look no further than s 43(1) of the AAT Act, which provides:
Tribunal's decision on review
(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.
37 Of course in making its decision the Tribunal must give reasons (s 43(2) AAT Act).
38 During the hearing both parties directed my attention to the introductory words to s 43(1) of the AAT Act, namely "for the purpose of reviewing a decision". The parties were joined on a question of law as to what powers were available to the Tribunal for the purpose of its review of ASQA's decisions in this case.
39 The core of ASQA's case was that the Tribunal erred in its decision, in that it acted outside the scope of its powers and had regard to irrelevant considerations, because the Tribunal exercised powers which were other than "for the purpose of reviewing" ASQA's decisions within the meaning of s 43(1) of the AAT Act. In particular, ASQA submitted that the reviewable decisions marking the boundary of the Tribunal's review were decisions imposing sanctions for regulatory non-compliance. In this context ASQA further submitted that the Tribunal on review could exercise all the powers and discretions available to ASQA when ASQA considered whether, and if so what, sanction was appropriate under the NVR Act and the ESOS Act.
40 In examining the phrase "for the purpose of reviewing a decision" it is helpful to have regard initially to the decision of Hill J in Secretary, Department of Social Security v Hodgson (1992) 108 ALR 322; (1992) 37 FCR 32. In that case a delegate of the Secretary made a decision to recover an overpayment of unemployment benefits paid to the respondent, however on review the Tribunal - for reasons relating to illness and hardship in respect of the payee - decided to waive part of the debt. The primary Judge noted that the jurisdiction of the Tribunal in that case depended on there having been a decision made by a decision-maker which the Tribunal was authorised to review (at 38). His Honour said (at 38):
Thus, if the original decision-maker, in the present case the Secretary, had not made any decision not to waive payment of the amount overpaid to Mr Hodgson, it would follow, so it was said, that the Administrative Appeals Tribunal had no power to review the matter of waiver. The argument is complicated in the present case by the intervention of the appeal by Mr Hodgson to the Social Security Appeals Tribunal. However, the same argument can be applied to that Tribunal if, despite the language of s 1283(2), the correct position were that the Administrative Appeals Tribunal's task was to review the decision of the Social Security Appeals Tribunal to affirm the Secretary's decision. The Social Security Appeals Tribunal was also not the primary decision-maker, hence, it was submitted, it could not deal with the matter of waiver, because as a matter of fact no decision had been made by the Secretary, or a person with delegated power from the Secretary, not to waive the overpayment. Hence, even though the Social Security Appeals Tribunal purported to consider the matter for itself in connection with the review of the decision of the Secretary to recover the overpayment, it had no power so to do and hence on a review of its decision by the Administrative Appeals Tribunal, there was no power in that Tribunal to consider the question of waiver.
41 His Honour continued at 38-39:
In my view, and on the assumption that there was as a matter of fact no consideration given by any relevant decision-maker to the question of waiver (at least before the matter came before the Social Security Appeals Tribunal), this question may be resolved by determining whether in reviewing the decision of the delegate to proceed to recover the overpayment from Mr Hodgson s 43(1) of the Administrative Appeals Tribunal Act empowered the Tribunal to itself exercise the power of waiver conferred upon the Secretary, or whether the power of waiver was to be seen as so separate and remote from the decision to recover, that exercise by the Tribunal of the power to waive the overpayment was not authorised by s 43.
If, as the Tribunal appears to have concluded, there was a legal obligation upon the Secretary when considering the question of recovery to consider the issue of waiver, then the answer is self-evident. The same obligation would flow through to the Tribunal. However, I do not think that it is correct to say that there is an obligation to consider waiver every time the issue of raising the overpayment as a debt and its recovery arises. …
42 Later his Honour said at 39-40:
Although I accept, therefore, that a decision to recover an overpayment does not necessarily involve a consideration of waiver, I do not think that it follows that in an appeal against the decision to proceed to recover an overpayment where the question of waiver has been raised by an applicant the Tribunal is precluded from exercising the power to waive under s 43(1) of the Administrative Appeals Tribunal Act. The language of s 43 is quite clear and unambiguous. It empowers the Tribunal to exercise all the powers and discretions conferred upon the original decision-maker provided it does so for the purpose of reviewing a decision. Provided the necessary purpose is present, the power conferred upon the Tribunal is not otherwise limited. It is not necessary or permissible to put a gloss upon s 43 that would permit the Tribunal to exercise the decision-maker's powers and discretions only when those powers or discretions are necessarily interdependent with the decision under review or where the power or discretion to be exercised by the Tribunal is necessarily involved in the making of the decision under review.
Of course there must be an association between the power to be exercised by the Tribunal and the decision under review, but that association is to be found in the restriction of the grant of power in s 43(1) to the purpose of the Tribunal's review. The test is one of relevance rather than dependence. Where the exercise of a power or discretion is relevant to the making of the decision under review then, if requested, the Tribunal may exercise the discretion. The Tribunal is …"another executive body in an administrative hierarchy". Where its jurisdiction is enlivened by an application to review an administrative decision it exists to do again, within the limits of the review, that which the decision-maker was entrusted to do. To adapt what was said by Kitto J in Mobil Oil Australia Pty Ltd v Commissioner of Taxation (Cth) (1963) 113 CLR 475 at 502, the Tribunal in deciding whether an overpaid benefit should be recovered has the function of working out as a step in administration what it considers the situation to be. If the original decision-maker could legitimately have considered the issue of waiver before the issue of recovery and would have been obliged so to do if requested by the recipient of the overpayment, why should the Tribunal be precluded from so doing when for the purposes of the review it stands in the shoes of the original decision-maker?
It follows, in my view, that the Tribunal had jurisdiction to determine for itself, but as part of its review of the decision to recover the overpaid benefits, the question of whether some or all of the benefit should be waived.
43 In my respectful opinion the explanation of his Honour in Hodgson of the effect of s 43 of the AAT Act and the relevant powers of the Tribunal on review was both concise and accurate.
44 In Australian Securities and Investments Commission v Donald (2003) 136 FCR 7; [2003] FCAFC 318 the Full Court referred to the principles articulated in Hodgson and other cases, observing:
24. The effect of subs 43(1) of the AAT Act is that, "[f]or the purpose of reviewing a decision", the Tribunal stands in the place of the original decision-maker. That is, for the purpose of determining whether the decision under review was the correct or preferable decision on the material before it, the Tribunal "may exercise all the powers and discretions that are conferred by any relevant enactment on the person who made the decision" (emphasis added). As a consequence, the Tribunal is not confined to the decision-making power upon which the previous decision-maker actually relied in making the decision under review, but is armed with all the powers and discretions of the original decision-maker that are relevant to the review: see, e.g., Re Control at 92 per Davies J; Fletcher v Commissioner of Taxation (1988) 19 FCR 442 ("Fletcher") at 453 per Lockhart, Wilcox and Burchett JJ; Secretary, Department of Social Security v Hodgson [1992] FCA 338; (1992) 37 FCR 32 ("Hodgson") at 39-40 per Hill J; and Secretary, Department of Employment, Education, Training and Youth Affairs v MacKay (1998) 29 AAR 95 at 98 per Kenny J.
25. The decision of the Full Court in Fletcher well illustrates the effect of subs 43(1) of the AAT Act. In that case, the Commissioner of Taxation rejected the taxpayers' claims for allowable deductions in relation to certain annuity payments and disallowed their subsequent objections. On reviewing the Commissioner's objection decisions, the Tribunal not only affirmed the Commissioner's disallowance of the objections but also exercised the discretion conferred upon the Commissioner by s 177F(1) of the Income Tax Assessment Act 1936 (Cth), to cancel a tax benefit (as defined in s 177C of that Act). The Full Court rejected the taxpayers' submission that subs 43(1) of the AAT Act did not empower the Tribunal to exercise a discretion vested in the decision-maker at an earlier stage in the process and unexercised by the Commissioner. In so doing, the Full Court stated, at 452:
As a matter of principle, it must be correct, as submitted on behalf of [the taxpayers], that the powers and discretions referred to by s 43(1) are the powers and discretions vested in the original decision-maker for the purposes of making the decision under review. They do not include any powers and discretions which may be vested in the decision-maker for some other purpose. ...
However, we do not think that it follows that, in the present case, the Tribunal lacked jurisdiction to exercise the discretion conferred upon the Commissioner by s 177F(1).
26. The Full Court reached this conclusion, because, after considering the relevant statutory provisions, it concluded, at 453, that:
... in determining an objection to an assessment, the Commissioner is entitled to make a determination under s 177F of the Act; and thereafter to give effect to that determination by an appropriate decision under s 186.
By force of s 43 of the Administrative Appeals Tribunal Act, the Tribunal has all the powers and discretions that are conferred by s 186 of the Income Tax Assessment Act upon the Commissioner. In exercising those powers and discretions the Tribunal was bound to consider the facts as they were proved in evidence before the Tribunal, making the decision which, upon that evidence and at that time, was the correct or preferable decision to be made in considering the objection. The Tribunal was not confined either to the material which was before the Commissioner, as primary decision-maker, or the events which had occurred up to that time ...
Once it is understood that, in exercising his powers under s 186, the Commissioner would have been free to exercise a discretion under s 177F of the Income Tax Assessment Act, it follows that, in reviewing the Commissioner's decision under s 186, the Tribunal is free to exercise that same discretion if, upon the material then before it, it seems proper to take that course.
27. The Full Court made some further observations that are relevant to the present case, saying, at 453-454:
In coming to that conclusion, we appreciate that s 177F(3)-(8) provides a regime whereunder the Commissioner may make compensating adjustments in respect to any taxpayer. ... In a case where the requisite adjustment needs to be made to an assessment not before the Tribunal - either because it relates to some other taxpayer or to some other year of income - the Tribunal could not itself make an adjustment under s 177F(3). But we see no difficulty about the Commissioner following up the decision of the Tribunal by making the appropriate adjustment, in the same way as he would do if he himself had made the original s 177F(1) determination. (Emphasis added)
(Emphasis in original.)
45 The observations of Justice Hill in Hodgson were adopted by the Full Court in Commonwealth Bank Officers Superannuation Corporation Pty Ltd v Commissioner of Taxation (2005) 148 FCR 427; [2005] FCAFC 244 where their Honours said:
29. Ultimately, the question turns upon the proper construction of s 43 of the AAT Act. Section 43 empowers the Tribunal to exercise all the powers and discretions conferred upon the original decision maker, provided it does so for the purpose of reviewing a decision. Provided the necessary purpose is present, the power conferred upon the Tribunal is not otherwise limited. It is neither necessary nor permissible to put a gloss upon s 43 that would permit the Tribunal to exercise the decision maker's powers and discretions only when those powers or discretions are necessarily interdependent with the decision under review, or where the power or discretion to be exercised by the Tribunal is necessarily involved in the making of the decision under review - see Secretary, Department of Social Security v Hodgson [1992] FCA 338; (1992) 37 FCR 32 at 39-40.
30. Thus, so long as the exercise of powers and discretions by the Tribunal is for the purpose of reviewing a decision, all of the powers and discretions conferred by any relevant enactment on the decision maker who made the decision, can be exercised by the Tribunal. Clearly, the Surcharge Act is a relevant enactment. Section 8(5)(b) of the Surcharge Act confers a discretion on the Commissioner to give or withhold approval of another method. The decision that is to be reviewed by the Tribunal is the Commissioner's objection decision of 26 August 2004 in respect of the assessment of the surcharge liability relating to Mr Cocks. The unequivocal words of s 43(1) are that, for the purpose of reviewing that decision, the Tribunal may exercise all the powers and discretions that are conferred by the Surcharge Act, as a relevant enactment, on the Commissioner.
(Emphasis in original.)
46 The width of Justice Hill's construction of s 43 of the AAT Act was also accepted as accurate by the Full Court in Commissioner of Taxation v Hornibrook (2006) 156 FCR 313; [2006] FCAFC 170.
47 In this context I also note the following comments of Kiefel J (as her Honour then was) in Shi v Migration Agents Registration Authority (2008) 235 CLR 286; [2008] HCA 31:
136. The respondent argued that s 43(6), read with s 43(1), shows that the Tribunal is only intended to exercise the power of the original decision-maker when it discovers error. Error is the foundation for the power to vary or set aside the decision, under s 43(1)(b) or (c)(i). Where it affirms a decision it determines that the decision is correct. In the case of remitter, the further exercise of powers is left to the original decision-maker.
137. The respondent's argument does not distinguish between the powers given to the Tribunal by s 43(1) "[f]or the purpose of reviewing a decision" and the making of a decision, under pars (a) to (c), following upon that review and to give effect to it. Indeed the argument tends to ignore the powers, which are to permit the Tribunal to consider for itself what the decision should be. Such powers are not consistent with a role limited to the ascertainment of error.
…
141. The reasons of the members of the Full Court of the Federal Court in Drake v Minister for Immigration and Ethnic Affairs confirm what is apparent from s 43(1), that the Tribunal reaches its conclusion, as to what is the correct decision, by conducting its own, independent, assessment and determination of the matters necessary to be addressed. To the contrary of the argument put by the respondent on this appeal, that the Tribunal's exercise of power is dependent upon the existence of error in the original decision, Smithers J denied that the Tribunal was limited to something of a supervisory role. As his Honour said, the Tribunal is authorised and required to review the actual decision, not the reasons for it.
142. In considering what is the right decision, the Tribunal must address the same question as the original decision-maker was required to address. Identifying the question raised by the statute for decision will usually determine the facts which may be taken into account in connection with the decision. The issue is then one of relevance, determined by reference to the elements in the question, or questions, necessary to be addressed in reaching a decision. It is not to be confused with the Tribunal's general procedural powers to obtain evidence. The issue is whether evidence, so obtained, may be taken into account with respect to the specific decision which is the subject of review.
(Footnotes omitted, emphasis added.)
48 More recently in Frugtniet v Australian Securities and Investments Commission (2019) 367 ALR 695; [2019] HCA 16, Kiefel CJ, Keane and Nettle JJ observed:
51. …[E]xcept where altered by some other statute, which has not occurred here, the jurisdiction conferred on the AAT by ss 25 and 43 of the AAT Act, where application is made to it under an enactment, is to stand in the shoes of the decision-maker whose decision is under review so as to determine for itself on the material before it the decision which can, and which it considers should, be made in the exercise of the power or powers conferred on the primary decision-maker for the purpose of making the decision under review. The AAT exercises the same power or powers as the primary decision-maker, subject to the same constraints. The primary decision, and the statutory question it answers, marks the boundaries of the AAT's review. The AAT must address the same question the primary decision-maker was required to address, and the question raised by statute for decision by the primary decision-maker determines the considerations that must or must not be taken into account by the AAT in reviewing that decision. A consideration which the primary decision-maker must take into account in the exercise of statutory power to make the decision under review must be taken into account by the AAT. Conversely, a consideration which the primary decision-maker must not take into account must not be taken into account by the AAT.
(Footnotes omitted.)