(vii) if CASA requires particulars of licences held by flight crewmembers of the organisationthe authorisations conferred by the licences are appropriate, having regard to the nature of the AOC operations." [emphasis added]
65 The appellant contended that those numerous references to "safety" in s28(1) emphasise that the role of the appellant in issuing AOCs renders safety the paramount consideration. It was said to follow that this statutory framework rendered any agreement reached of a kind that courts would not enforce, though deliberately entered into by parties intending themselves to be bound. Reliance was placed on Australian Woollen Mills Pty Limited v The Commonwealth (1954) 92 CLR 424 where the High Court (Dixon CJ, Williams, Webb, Fullagar and Kitto JJ) observed that:
"It is of the essence of contract, regarded as a class of obligations, that there is a voluntary assumption of a legally enforceable duty." (at 457)
66 Windeyer J adopted that observation in South Australia v The Commonwealth (1962) 108 CLR 130 at 154 when he stated:
"An agreement deliberately entered into and by which both parties intend themselves to be bound may yet not be an agreement that the courts will enforce. The circumstances may show that they did not intend, or cannot be regarded as having intended, to subject their agreement to the adjudication of the courts. The status of the parties, their relationship to one another, the topics with which the agreement deals, the extent to which it is expressed to be finally definitive of their concurrence, the way in which it came into existence, these, or any one or more of them taken in the circumstances, may put the matter outside the realm of contract law. Undertakings that are political in character - using the word 'political' as referring to promises and undertakings of governments, either to their own citizens or to other states or governments - are therefore often not enforceable by processes of law."
67 The appellant then contends that:
"In light of the nature and purpose of the appellant's powers, it involves a large step to treat the appellant as entering into a contract (and thus making itself liable to damages, and claims for injunctions and specific performance) when it agrees not to persist with the cancellation of an AOC, because the operator is prepared to accept certain conditions. It also seems rather odd that the operator would also be liable in contract for failing to comply with the terms of such an agreement."
68 The appellant then contends that, though there be powers to enter into contracts in s13(1) and specifically s13(2)(a) of the Act, the general power to enter into contracts does not enlarge or alter the nature of the appellant's functions, these being functions to be exercised in a way whereby safety is the paramount consideration. Such a power to enter into contracts must be in aid of CASA's functions and was not so here.
69 The answer to this contention is twofold. First, it by no means follows that the statutory requirement that safety be the paramount consideration in the exercise of CASA's functions precludes entry into a binding and enforceable contract of the kind here in question. The second part of the answer lies in a closer analysis of the precise nature of the contract here in question. One could envisage a contract being precluded which, on its face, was incompatible with the paramountcy of safety under the Act. The question is whether this contract was of such a kind. I consider it was not, for reasons developed below.
70 The true nature of the present contract is that it constitutes an agreement by the parties jointly to approach the AAT and ask it, relevantly, "to set aside the decision made by CASA cancelling the AOC and make a new decision in substitution for the decision set aside, being the imposition of the Conditions". Those conditions are those earlier agreed between the parties to be suitable to be imposed upon Scenic's AOC in lieu of cancelling it. There was no evidence to indicate that the substitute conditions endangered air safety.
71 Importantly, by s31 of the Act, decisions of CASA are reviewable by the AAT. I consider that, self-evidently, a relevant function of CASA must be to respond to such review. Response may take a variety of forms from opposition to compromise. Thus such a response necessarily encompasses the possibility of reaching a settlement or compromise of the review process, within the framework of the Act. That would of course preclude a compromise which put safety in jeopardy but there is, as I have said, no evidence that this one did.
72 Under the AAT Act itself, it is expressly contemplated that agreements may be reached between the parties or their representatives as to the terms of a decision of the Tribunal in the relevant proceeding (s42C(1)(a) of the AAT Act). It is also contemplated that the terms of such agreement may be reduced to writing signed by or on behalf of the parties and lodged with the Tribunal (s42C(1)(b) of the AAT Act). The Tribunal must be satisfied that a decision in those terms, or consistent with those terms, would be within the powers of the Tribunal; s42C(1)(c). Thereupon the Tribunal may, if it appears to it to be appropriate to do so, act in accordance with s42C(2) or (3). There is, relevantly under s42C(2), power in the Tribunal to make a decision in accordance with those agreed terms without holding a hearing.
73 There is also under s42D of the AAT Act power at any stage of a review proceeding to remit the decision under review to the person who made it for its re-consideration.
74 Section 26 of the AAT Act provides that after an application is made to the Tribunal for a review of the decision, the decision may not be altered save, importantly, where "the parties to the proceedings, and the Tribunal, consented to the making of the alteration" (s26(1)(b)).
75 There is in my view no necessary inconsistency between, on the one hand, the legislation governing CASA including so far as relevant the AAT Act, and on the other, the capacity for parties to reach a concluded agreement, binding at law, whereby the parties agree jointly to approach the AAT and ask it to set aside the relevant decision on agreed terms. Such a contract does not a priori indicate any failure to have regard to safety considerations. Nor, by subjecting CASA to the sanction of damages, does it prevent CASA from taking into proper account safety considerations in reaching such a binding agreement, and otherwise conforming to the Act in the kind of conditions contemplated. There is no submission made that the conditions here contemplated were incompatible with the Act or not within its contemplation.
76 Indeed the very capacity to make such a contract (s13 of the Act) is capable of furthering CASA's powers under the Act. The parties are able consensually to reach an agreement compatible with safety considerations without the delay and uncertainty inherent in an adversarial contest before the AAT. I agree with the trial judge that there is a powerful public interest in parties being encouraged to settle litigation in the AAT, as in other jurisdictions. I agree in particular with the following observations of the trial judge (at [53]) though with the reservation that I do not consider the AAT would have acted as a mere rubber stamp with respect to the agreement handed up:
"53. … It is true the parties, by the time CASA withdrew from the agreement, had not created just one document to hand the AAT, but they had agreed on the variations to the undertakings so such a document, even a copy of the undertakings with handwritten amendments, I find, could have been handed up. The handing up of such a document would have been consistent with the practice of courts and tribunals when cases are settled. Consideration of the merits appears not to have been necessary. Parliament, as senior counsel for Scenic submitted, provided compromise in the available armoury of dispute resolution. Given the agreement was reached at a conference held at the suggestion of the Deputy President, both parties were represented by counsel and solicitors, and CASA had personnel present and involved in an area where it had special interest and expertise, viz civil aviation, (see: Re Higginbotham and Repatriation Commission 35 ALD 179 at [26]), it is unlikely in the extreme, I find, the Deputy President would not have been satisfied a decision in its terms or consistently with them was within the AAT's powers. CASA, I find, was bound to instruct its solicitors to ask the AAT, in company with Scenic's solicitor, to make consent orders to reflect the agreement."
77 Earlier at [48] the trial judge concluded that, "… as to the question of power, the AAT had power to set aside the AOC's cancellation and, I am satisfied, would have done so if asked to, as one of the terms of settlement".