A DECISION INDUCED OR AFFECTED BY FRAUD - APPEAL GROUND 1
24 As is well known, fraud must be distinctly pleaded and proven. The appellant's case concerning fraud is difficult to understand. In ground 1 of his application for judicial review, the appellant alleged that Adani dishonestly made a misleading representation, the representation being that the accuracy of the economic material in the EIS was "not subject to dispute". At para (g) of the particulars, the appellant alleged that it should be inferred that officers or employees of Adani knew that the undisclosed material differed from that in the EIS. At para (h) he alleged that Adani did not, prior to the Tribunal's decision, disclose the joint report or the further reports, or advise the Tribunal of the existence of such documents. Hence the appellant's case was that Adani dishonestly misled the Tribunal by not disclosing the latter material. Nonetheless the appellant spent much time, at first instance and on appeal, in trying to establish that for the purpose of s 5(1)(g), "fraud" includes "conduct analogous to fraud", and that the term, "conduct analogous to fraud" may include conduct which involves no dishonesty. There were references to recklessness, but recklessness was not alleged in the application for review.
25 One might have thought that as a matter of construction, it would be difficult to avoid the conclusion that in a statute, the word "fraud" describes conduct involving some degree of dishonesty. To the ordinary person the word "fraud" necessarily carries that connotation. The expression, "conduct analogous to fraud" has no precise meaning. In cases largely concerned with the remedy of certiorari, it seems to have been used to describe other dishonest conduct such as collusion or perjury. However in R v Home Secretary of State; Ex parte Al-Mehdawi [1990] 1 AC 876 at 896 Lord Bridge said that even without dishonesty, the failure by a prosecutor to advise the defendant of the existence of witnesses favourable to his defence produced the same effect as dishonesty, "in distorting and vitiating the process leading to conviction ...", such failure being in breach of the prosecutor's duty to the Court and to the defendant. See also R v Burton upon Trent Justices ex parte Woolley [1995] RTR 139.
26 The ground for relief identified in s 5(1)(g) involves "fraud", not circumstances or conduct analogous to fraud, whatever may constitute such circumstances or conduct. We do not accept that the ambit of operation of s 5(1)(g) may be extended by asserting that the word "fraud" includes "conduct or circumstances analogous to fraud". Such an approach would lead to unnecessary uncertainty and would be inconsistent with the language adopted by Parliament. The relevant question is as to the meaning of the word "fraud" in s 5(1)(g).
27 In Seven West Media Ltd v Commissioner, Australian Federal Police (2014) 223 FCR 234 at 257-258 Jagot J observed that the decision of the Full Court in Lego Australia Pty Ltd v Paraggio (1994) 52 FCR 542 was authority for the proposition that s 5(1)(g) was concerned with deliberate misrepresentation. In our view, her Honour was correct. Although it seems that in Lego, s 5(1)(g) may not have been specifically relied upon, the majority (Beaumont and Whitlam JJ) considered that fraud had been raised by virtue of allegations of lack of good faith, a failure to speak where there was a duty to speak, and abuse of office. The case concerned an ex parte application by a customs officer for the issue of search warrants. In proceedings under the ADJR Act, it was asserted that the applicant bore a duty to make full disclosure to the issuing authority, of all material matters of which he was aware, or ought to have been aware. It seems that in support of that proposition, reliance was placed upon the requirement in civil proceedings that on an ex parte application for relief, the applicant must make full disclosure. At 555 the majority said:
As has been said, in our view, the present question is one of statutory construction and is not to be resolved by reference to the principles of the general law. In particular, the practice in equitable jurisdictions in the grant of discretionary relief, ex parte, in private civil litigation does not, in our opinion, provide an appropriate analogy here. That is to say, in our opinion, the instant matter is to be decided in accordance with the terms, express and implied, of the provisions of s 10(1) of the Crimes Act, properly construed. Those terms are relevantly explained in propositions (1) to (5) extracted above from Rockett's case. Nothing there suggests the existence of a "duty" of disclosure in the informant, breach of which would invalidate the warrant. Indeed the existence of such a principle would be inconsistent with the approach taken in Rockett's case. Under that approach, attention is focused upon the role of the magistrate or justice as the administrative decision-maker in accordance with principles of administrative law. This may be contrasted with the position in private civil litigation where, if ex parte relief is sought, the conduct or misconduct of the party obtaining the relief, rather than the decision-maker, is the relevant consideration. Put differently, the present question is one of public or administrative law; its resolution depends upon the characteristics of the action of the decision-maker, including the processes adopted by him or her and, in the extreme case of "unreasonableness", the nature of the outcome if perverse.
It is true that, in an exceptional case, an administrative decision may be vitiated by fraud or misrepresentation even at common law (see, eg Sir William Wade, Administrative Law (6th ed, 1988), p 257). The AD(JR) Act itself makes such a provision: see s 5(1)(g). In that special situation, it will be necessary to consider the conduct of the party making application for an administrative decision. But, generally speaking, the role of the court in judicial review is to supervise the activities of the Executive so as to ensure that administrative action takes place in accordance with the rule of law. This supervisory jurisdiction is very different in character from the function of the courts in determining civil disputes between private citizens. In other words, it may be one thing to apply the principles discussed in Edison v Bullock in ordinary civil litigation. It is another to seek to apply them in an application for judicial review of a decision to grant a warrant where the statutory authority to grant the warrant contemplates that the application for it will, necessarily, be made ex parte, yet where the statute also requires, in order to protect the legitimate interests of members of the community, that certain conditions be fulfilled before the warrant may be granted.
It follows, in our view, that there is no general, in the sense of abstract, "duty" of disclosure here. This is not to say that a warrant should not be set aside, as other administrative decisions can be, where there has been fraud or misrepresentation. For this purpose, a statement which was a half-truth and thus misleading (see eg R v Kylsant [1932] 1 KB 442) would be treated, in this, as in other contexts, as a misrepresentation.
Put differently, the primary question here is not whether the informant was under an obligation to disclose to the justice a particular fact, but whether the statements in the Information were sufficient to satisfy the requirements of s 10(1). There is also a question whether the decision to grant the warrant was induced by fraud. It will be convenient to consider these questions separately. The first question will be considered from the standpoint of what appears on the face of the Information, that is, without recourse to any extrinsic material. However, the position in the case of the second question is different. There, since fraud or misrepresentation is alleged, it will be necessary to look at collateral material in order to ascertain whether any representation by the informant was, when measured against the objective circumstances, false.
28 At 563 their Honours said:
In par 25(g) of the amended statement of claim, it is alleged that the ACS officers were aware, or ought to have been aware, of the matters alleged in par 10 thereof. The allegations in par 10 address the dealings between the parties in the period 1978 to 1981. Again, essentially for the reasons given in respect of the allegations made in par 24, we are not satisfied that, in this respect, the ACS officers knowingly misrepresented the position to the decision-maker.
29 In our view, knowing misrepresentation involves more than making a misrepresentation which is factually wrong. It is the misrepresentation which must be knowingly made, suggesting that there must be an intention to mislead. The appellant seems to assert that we should not take this view of s 5(1)(g).
30 In recent years, the question of fraud has been frequently addressed in connection with applications in migration cases for the issue of constitutional writs, or similar relief. In the present case, at first instance and on appeal, the appellant relied heavily upon the dissenting reasons of French J (as his Honour then was) in Minister for Immigration and Multicultural Affairs v SZFDE (2006) 154 FCR 365, and the reasons of the Full High Court on appeal. See SZFDE v Minister for Immigration and Citizenship (2007) 232 CLR 189. The case concerned the availability of relief in the nature of certiorari and mandamus. A family seeking protection visas had been represented by a person who falsely claimed to be a solicitor and a migration agent. When the family members were invited by the Refugee Review Tribunal to attend a hearing, the bogus agent advised them not to appear, upon which advice they acted. Their failure to attend led to rejection of their applications. In effect, the question in the case was whether the decision to reject the applications should be set aside for reason of the bogus agent's conduct.
31 In this Court, French J considered the meaning of the term "fraud" in connection with the availability of certiorari. His Honour also said a little about fraud for the purposes of s 5(1)(g) of the ADJR Act, although there was, in that case, no application pursuant to the ADJR Act. Further the case was clearly one of actual dishonesty. To the extent that French J expressed any view as to the meaning of the term "fraud" in s 5(1)(g), it was, at best, obiter.
32 On appeal the High Court noted the distinction between fraud at common law and in equity, referring to observations by Professor Hanbury to the effect that in equity, the word "fraud" was applied, "indifferently to all failures in relations wherein equity set a certain standard of conduct". The author also pointed to use of the word in describing the exercise of powers of appointment and other powers, "in a fashion of which equity disapproved".
33 At [12]-[13], the High Court said:
12 The attachment by courts of equity of the term "fraud", with related notions of "bad faith" and "abuse of power", when stigmatising exercises of powers of appointment and fiduciary powers as falling short of the standards equity required of the repositories of those powers, has proved influential in the development of public law. What came to be known as the principle of "Wednesbury unreasonableness" was developed in the case law by analogy to the principles controlling the exercise of powers of discretions vested in trustees and others.
13 However, several points should be made here. First, given the equitable nature of their origins described above, principles of public law concerning impropriety in the exercise of statutory powers have not had the focus upon what might be called the "red blooded" species of fraud which engages the common law. Secondly, with respect to references in the public law decisions to good and bad faith and the like, the following observation in a leading English text is in point:
"These add very little to the true sense, and are hardly ever used to mean more than that some action is found to have a lawful or unlawful purpose. It is extremely rare for public authorities to be found guilty of intentional dishonesty: normally they are found to have erred, if at all, by ignorance or misunderstanding. Yet the courts constantly accuse them of bad faith merely because they have acted unreasonably or on improper grounds. Again and again it is laid down that powers must be exercised reasonably and in good faith. But in this context 'in good faith' means merely 'for legitimate reasons'. Contrary to the natural sense of the words, they impute no moral obliquity."
Aickin J made observations to similar effect in R v Toohey; Ex parte Northern Land Council.
(Footnotes omitted.)
34 Clearly, the High Court was primarily discussing cases in which complaint was made as to a decision-maker's conduct.
35 The High Court then turned to the question of fraud by a third party, which fraud had affected an administrative decision, and the availability in those circumstances of, in particular, the remedy of certiorari. The Court noted that in early versions of the migration legislation, judicial review had been limited to circumstances in which a decision was induced or affected by fraud, mirroring the language of s 5(1)(g) of the ADJR Act. The Court accepted that in such a regime, fraud by a third party would attract judicial review of any decision induced or affected by such fraud. The Court then turned to the "nature, scope and purpose" of the prescribed system of review in the case in hand, namely the availability of relief in the nature of certiorari and mandamus.
36 At [40]-[45] the Court set out in detail the circumstances in which the members of the family had failed to attend the hearing in the Refugee Review Tribunal. Clearly, the High Court considered that the case involved actual dishonesty rather than conduct to which no "moral obliquity" could be attached. The New Shorter Oxford English Dictionary defines "obliquity" to mean, "Divergence from right conduct or thought; perversity, aberration ...". According to the same reference book the word "moral" means, "Of or pertaining to human character or behaviour considered as good or bad". We infer that "red blooded fraud" would involve a degree of moral obliquity.
37 We turn to decisions of this Court which have applied the decision of the High Court in SZFDE. In Minister for Immigration and Citizenship v SZLIX (2008) 245 ALR 501 at [30]-[33], the Full Court observed:
30 Even assuming both that the invitation reached the agent and that the agent had undertaken to notify the respondent - his Honour (at [18]) appears to make this latter finding - there is again, in our view, no substratum of facts which would justify the inference that the agent dishonestly omitted to inform the respondent. That failure could as easily be ascribable to oversight or negligence.
31 Counsel for the respondent has sought to avert the above conclusion by contending, in effect, that the fraud inhered in the agent holding himself out to be registered when he was not registered, so depriving the respondent of the services of a registered agent who was subject to the regulatory regime of Pt 3 of the Act. Whether or not the failure to inform the respondent was deliberate or negligent, the agent's actions as an unregistered person were, it is said, causally connected to the frustration of the procedural fairness scheme of Pt 7 Div 4.
32 We have already indicated that we do not consider that a finding that the agent was unregistered was open on the evidence. Even assuming it was, and assuming, moreover, that the respondent was thereby misled, we do not consider that all of the agent's acts or omissions vis-à-vis the respondent are thereby to be characterised as dishonest. Nor do we consider that any particular such act or omission which directly effects the Tribunal's discharge of its imperative statutory functions in a manner which is adverse to a person seeking Tribunal review can in turn be characterised as a "fraud on the Tribunal".
33 The Parliament, in Div 2 of Pt 3 of the Act, has created a series of offences relating to the giving of immigration assistance by unregistered migration agents. It has not gone on to reverse, in the way proposed in the respondent's submission, such adverse consequences as may enure to a person in the enjoyment of the procedural fairness benefits provided by the Act as may be occasioned by reliance upon the immigration assistance supplied or to be supplied by an unregistered migration agent. Neither has the common law gone so far in its fraud doctrine: see SZFDE at [53]. This said, an agent may be fraudulent in his dealings with a visa applicant in such a manner as results directly in a fraud on the Tribunal in relation to the due discharge of its Pt 7 Div 4 functions. SZFDE is testament to this. But SZFDE requires that the agent in question is fraudulent in a way that effects the Tribunal's Pt 7 decision-making process. An omission to notify the date of a hearing to a visa applicant may have adverse consequences for that applicant if, as here, the Tribunal proceeds to make a decision under s 426A in the applicant's absence. But before that omission can properly be said to have occasioned a fraud on the Tribunal, it must itself be able properly to be characterised as a fraudulent omission vis-à-vis the visa applicant: SZFDE, at [51]. The simple fact of a failure to inform or bare negligence or inadvertence will not necessarily be sufficient to give rise to fraud on the Tribunal. As we have indicated, particularly having regard to the level of satisfaction required by Briginshaw v Briginshaw (1938) 60 CLR 336 at 363 and 368 in cases where fraud is alleged, we do not consider that it was open to his Honour to infer fraud.
38 In SZHVM v Minister for Immigration and Citizenship (2008) 170 FCR 211 Middleton J considered both decisions and said at [54]:
Whilst the appeal before me is not simply a case of a failure to inform or mere inadvertence, nor is it to be characterised as a case of fraud vis-à-vis the appellant, nor even then a fraud on the Tribunal. I appreciate, as Finkelstein J in SZIVK [2008] FCA 334 (at [33]) reminds us, that there are many ways in which fraud may be manifested. However, this is not a case where one can infer that the agent, in making the statements to the appellant that resulted in her not attending, acted other than honestly; Mr Marzukie was just concerned about his own interests and put them above those of the appellant.
39 Of course neither case involved an application pursuant to the ADJR Act. Neither the decision in SZFDE nor those in SZLIX and SZHVM addressed conduct of a third party which was not accompanied by moral obliquity. There are many circumstances in which the conduct of a third party might lead a party to proceedings in a court or tribunal to fail to appear when invited or required to do so. These cases suggest, and one would expect, that the relevant conduct would have to be, in some degree, reprehensible if it were to have the effect of invalidating an ensuing decision.
40 In SZFDE at [40]-[42], the High Court recognised the fact that both the Federal Magistrate and French J had identified in detail the dishonest conduct which led to the non-appearance in the Refugee Review Tribunal. At [45]-[46] the High Court identified a further element of dishonesty. Thus it seems that the High Court treated the fraud in that case as being of the "red blooded" kind, rather than conduct commonly described in equity and public law as fraud despite the absence of moral obliquity. We note also that the latter usage seems to occur generally in connection with the conduct of the decision-maker rather than the parties, although it may well include conduct by a government agency, whether a party or not. However, as concerns a third party, the cases seem only to establish that red blooded fraud may lead to the invalidity of an affected decision.
41 As we have said, the question for present purposes is the meaning of the word "fraud" in s 5(1)(g). We have discussed SZFDE and the subsequent cases primarily because the appellant relied so heavily upon the High Court's reasons and those of French J. However those reasons do not necessarily dictate the proper construction of that provision.
42 Whilst the concept of review pursuant to the ADJR Act is no doubt derived from and, in many respects, analogous to that available pursuant to the prerogative or constitutional writs, it is the language of the statute which defines its operation. Whilst it may be open to courts exercising such supervisory power to, in effect, extend the availability of such relief in order to perform that function, it is not open to this Court to take that step in connection with relief under the ADJR Act. Apart from this consideration, a number of other factors suggest that the word "fraud", in s 5(1)(g), has a more limited meaning.
43 First, in parts of s 5 other than s 5(1)(g), the ADJR Act expressly addresses conduct of the kind identified in SZFDE as being often described as fraud, notwithstanding the absence of moral obliquity.
44 Secondly, there may be a degree of uncertainty as to how, in this case, the distinction between private and public law is affected by the nature of the function to be performed by the Tribunal, in effect the resolution of a dispute between the State, a proposed developer and a native title applicant. Adopting the words of the High Court in SZFDE at [29], this case will, in the end, require close attention to the nature, scope and purpose of the system of review established by the ADJR Act, having regard to the relevant provisions of the Native Title Act.
45 Thirdly, the decision in SZFDE concerned the dishonest conduct of a third party, that is, a party not directly concerned in the proceedings in question. In the present case, the appellant, a third party, effectively complains about the conduct of one of the parties to the proceedings in the Tribunal, or perhaps all of them, as well as that of the Tribunal itself. Assuming that the Tribunal correctly excluded the appellant from participating in the proceedings, it seems unlikely that he can, on any basis, complain that one party to the proceedings misled the other parties and the Tribunal, when no actual party makes such an allegation. Indeed it is difficult to see how a third party could ever complain that the parties had been misled where none of them so asserts. On the other hand, if the appellant ought to have been allowed to participate in the proceedings, as he may assert in grounds 7-10, he might succeed in upsetting the decision upon the basis of denial of procedural fairness, but not upon the basis that the parties and the Tribunal were misled.
46 The impugned conduct in this case is said to be a representation that the accuracy of the economic material in the EIS was "not subject to dispute". However the forecasts concerning the economic impact of the project, including the impact on employment, were clearly matters of opinion. Hence the appellant really asserts that Adani represented that the relevant expert opinions were, "not subject to dispute". One must then enquire as to the meaning of the phrase, "not subject to dispute". It cannot mean that Adani was representing that no relevant expert, anywhere in the world, would express a different opinion, or that it had no reason to believe that there may be other, contradictory opinions. The appellant's case, as disclosed in the application for review, was one of dishonest misrepresentation. He pointed to eight factors of which his Honour said at [138]:
Mr Burragubba relied upon eight "multifactorial factors" to attempt to establish that the conduct of Adani's officers was "dishonest according to ordinary notions". As outlined in his counsel's oral submissions, they were:
(a) the significance of the subject matter, for example a criterion that the arbitral body must take into account;
(b) the ease with which the subject matter withheld could have been provided to the decision-maker, for example the three reports in question were, in total, 100 pages in length;
(c) the calibre of the author of the withheld material, for example Dr Fahrer held a PhD from Princeton University in the United States of America and his supervisor was Mr Ben Bernanke, the then chair of the US Federal Reserve;
(d) the stage of the decision-making process at which the material was withheld, for example whether the material was withheld during the decision-making process itself or was not available until a considerable period of time after the decision had been made;
(e) the objective significance of the decision to be made by the decision-maker, for example the grant of a lease for 30 years as compared to the grant of a temporary licence for seven days;
(f) the capacity of the other party to provide the withheld material to the decision-maker, for example material that is readily available in the public domain as compared to material that is commercial-in-confidence to a particular party;
(g) the existence of any relevant expectations in relation to the conduct; and
(h) the ability of the decision-maker to gain access to the withheld material by making his or her own inquiries.
47 It is important to note that the appellant advanced this list of considerations in order to demonstrate that Adani's officers were dishonest. The list, it seems, was not advanced as the basis for some implied duty to disclose the undisclosed material. The appellant did not, at first instance or on appeal, explain why or how these eight matters, taken together or separately, led to the proper characterisation of any conduct by Adani's officers as, "dishonest according to ordinary notions". The words, "according to ordinary notions" suggest to us actual dishonesty and nothing less. Nor did the appellant cross-examine those of Adani's witnesses who swore affidavits explaining the circumstances in which the joint report and the further reports were obtained and used. The appellant seems to have considered that cross-examination was unnecessary in that he relied upon the contents of their affidavits. Yet it can hardly be asserted that the affidavits disclosed dishonesty.
48 In the end, it was for the appellant to demonstrate that in the circumstances of this case, some substantive or procedural rule required that Adani disclose something more than it would choose to disclose, having regard to its own interests. Whilst we accept that a party may not knowingly mislead the Tribunal, we see no basis for compelling the production of opinion evidence which may arguably have been less favourable to its case than was the EIS.
49 We see no justification in principle for any attempt to extend the meaning of the term "fraud" in s 5(1)(g), beyond its ordinary meaning. In particular, we see no basis, in the absence of any statutory intervention, relevant rule of court or court order, for imposing upon a party to proceedings, in a tribunal or a court, a general duty to disclose unfavourable opinions in its possession. There is no reason to believe that in this case, such disclosure was expected by the Tribunal, or by the other parties, or that any such expectation would have been justified.
50 In any event, the primary Judge concluded that the appellant's submissions concerning conduct analogous to fraud were simply irrelevant, and that the appellant's case was fraud or nothing. We agree. On appeal, the appellant submits that the primary Judge erred, "by failing to find that conduct analogous to fraud is capable of constituting fraud for the purposes of s 5(1)(g)" of the ADJR Act. His Honour made no such finding. He simply understood the appellant's case to be one of fraud, not conduct analogous to fraud. We agree that there was no alternative basis raised in the application for judicial review. If fraud were not proven, the appellant might yet have established the inferences pleaded in para (g) of the particulars, but we do not accept that mere non-disclosure constituted, in this case, fraud or conduct analogous to fraud.
51 As far as we are aware, those responsible for preparing the EIS have not resiled from their views. Further, the views expressed by Dr Fahrer and Mr Campbell concerned issues raised by one of the respondents in the Land Court proceedings. It seems that such issues were not raised in the Tribunal. Finally, the appellant has not sought to demonstrate the merits of his complaint by reference to witnesses who understand the relevant areas of expertise and the contents of the EIS and the further reports. He has rather formed his own views about evidence concerning theoretical exercises, in respect of which neither the Tribunal nor he had any expertise.
52 The appellant seems to assume that Adani should necessarily have abandoned the EIS in face of Dr Fahrer's criticisms. We accept that a party may not consciously allow a court or tribunal to act upon evidence which it knows to be false. However there is a clear distinction between knowing that a witness has lied about something, and knowing that expert opinions differ about a particular matter. Where expert opinion is involved, the court or tribunal, and the parties are very much in the hands of the experts. If the appellant wished to prove misleading effect, he could do so only by showing that the material in the EIS was misleading in a material respect. He could not do so simply by demonstrating the existence of conflicting opinions, assuming that the undisclosed material was, in fact, inconsistent with the relevant material in the EIS.
53 In the end, the primary Judge found that there had been no dishonestly misleading conduct by Adani, and that the Tribunal had not been misled. There is no express appeal against either finding.
54 Appeal ground 1 must fail.