Administrative Appeals Tribunal of Australia|2005-04-22

Howard and Australian Fisheries Management Authority [2005] AATA 360 (22 April 2005)

CATCHWORDS - FISHERIES - Southern Shark Fishery - fishing permits - allocation of catch quota as a condition of permit - quota based on best three years of catch between 1994 and 1997 - whether quota should take into consideration catch history in both Commonwealth and State waters - whether inability to fish because of wife's illness should be taken into account - whether policy applicable - whether any obligation to take into account the interests of individual operators - whether quota is varied by consideration of the value of permit - decision remitted.

Fisheries Legislation (Consequential Amendments) Act 1991 s. 3

Alexandra Private Geriatric Hospital Pty Ltd v Blewett and Another (1984) 2 FCR 368; 56 ALR 265

Australian Fisheries Management Authority v Graham [2003] FCA 231; (2003) 127 FCR 436

Australian Fisheries Management Authority v PW Adams Pty Ltd (1995) 61 FCR 314; 134 ALR 51

Bannister Quest Pty Ltd v Australian Fisheries Management Authority (1997) 77 FCR 503

Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission and Others [2000] HCA 47; (2000) 203 CLR 194

Drake v Minister for Immigration and Ethnic Affairs (1979) 24 ALR 577; 2 ALD 60

PW Adams Pty Ltd v Australian Fisheries Management Authority (1998) 49 ALD 68

PW Adams Pty Ltd v Australian Fisheries Management Authority (1995) 60 FCR 387

Re Drake and Minister for Immigration and Ethnic Affairs (No. 2) [1979] AATA 179; (1979) 2 ALD 634

Re Fischer and Australian Fisheries Management Authority [2002] AATA 857; (2002) 71 ALD 665

DECISION AND REASONS FOR DECISION [2005] AATA 360

1. remits the matter to the respondent to assess whether the applicant's allocation of Individual Transferable Quota appearing as a condition on his Southern Shark Fishery Permit No. 27008 is varied by considerations of the value of that permit; and

2. directs that:

(1) if it is varied by considerations of value, the respondent issue an Individual Transferable Quota appearing as a condition on the applicant's Southern Shark Fishery Permit No. 27008 taking account of that variation and the applicant's verified catch history of 1,194 kilogrammes of gummy shark and 0 kilogrammes of school shark; and

(2) if it is not varied by considerations of value, the respondent allocate an Individual Transferable Quota appearing as a condition on the applicant's Southern Shark Fishery Permit No. 27008 of 444.00 kilogrammes of gummy shark and 0 kilogrammes of school shark.

On 31 July 2001, the Australian Fisheries Management Authority ("AFMA") issued a permit numbered 27008 to Mr Howard authorising him to fish for school shark and gummy shark in the Southern Shark Fishery ("SSF") in the coastal waters relevant to Tasmania ("SSF permit"). It applied to the period from 25 July 2001 to 31 December 2001. Mr Howard was only permitted to use up to 10 gillnets that are 420 metres long by 20 meshes deep with the total length of headrope[1] not exceeding 4,200 metres. The SSF permit was issued on condition that Mr Howard catch no more than 444.00 kilogrammes of gummy shark and no school shark. At the time of the hearing, the permit was inactive as no boat had been nominated on it. Mr Howard considers that the catch limits specified as a condition to his SSF permit should be increased to take account of his inability to fish for shark in Tasmanian waters due to his needing to reduce his fishing activities so that he could care for his wife who suffered chronic illness. Regard should be had, Mr Howard submitted, to the catch history attached to a permit he previously held in Commonwealth waters forming part of the SSF and that he sold in 1996. I have decided that it is inappropriate to have regard to the catch history attached to that permit. I have also decided that AFMA should reconsider the Individual Transferable Quota ("ITQ") attached as a condition to his licence taking into account the value, if any, of his SSF permit but that it should not otherwise vary that ITQ.

2. The primary issue in this case is whether the ITQ attached as a condition to Mr Howard's SSF permit should be varied in light of the aggregation of his catch histories on his Commonwealth licence, in the SSF, and State licence, in Tasmanian coastal waters, between 1994 and 1997.

3. On 3 February 1992, AFMA was established under the Fisheries Administration Act 1991 ("Administration Act") to undertake a number of functions including:

"(a) to devise management regimes in relation to Australian fisheries;

(b) to devise fisheries adjustment programs and fisheries restructuring programs;

(c) to consult, and co-operate, with the industry and members of the public generally in relation to the activities of the Authority;

(d) to devise exploratory and feasibility programs relating to fishing;

(e) to establish priorities in respect of research relating to fisheries managed by the Authority and arrange for the undertaking of such research;

(h) the functions specified in section 9 relating to consultation;

(v) to undertake, on behalf of the Commonwealth, management responsibilities in relation to fisheries management arrangements entered into with the States and Territories;

AFMA may consult with persons, bodies or Governments including persons or bodies representative of the whole or part of the industry[3].

The object of the Fisheries Management Act 1991

(a) implementing efficient and cost-effective fisheries management on behalf of the Commonwealth; and

(b) ensuring that the exploitation of fisheries resources and the carrying on of any related activities are conducted in a manner consistent with the principles of ecologically sustainable development and the exercise of the precautionary principle, in particular the need to have regard to the impact of fishing activities on non-target species and the long term sustainability of the marine environment; and

(c) maximising economic efficiency in the exploitation of fisheries resources; and

(d) ensuring accountability to the fishing industry and to the Australian community in AFMA's management of fisheries resources; and

(e) achieving government targets in relation to the recovery of the costs of AFMA. " [4]

5. Under s. 17 of the Fisheries Management Act 1991 ("Act"), AFMA must either determine a plan of management for a fishery to which the Act applies or determine that a plan of management is not warranted. A "fishery" is defined to mean:

"... a class of activities by way of fishing, including activities identified by reference to all or any of the following:

(a) a species or type of fish;

(b) a description of fish by reference to sex or any other characteristic;

(c) an area of waters or of seabed;

(d) a method of fishing;

(e) a class of boats;

(f) a class of persons;

A "fish" is defined to include "... all species of bony fish, sharks, rays, crustaceans, molluscs and other marine organisms, but does not include marine mammals or marine reptiles."[6]

6. Where AFMA determines that a plan of management is warranted, it must determine the plan of management in writing only after following the procedural steps set out in that section. Once a plan of management relates to a fishery, it is known as a "managed fishery"[7].

7. A plan of management for a fishery may provide for its management by means of statutory fishing rights and other fishing concessions[8]. A "fishing right" means a "statutory fishing right"[9] and that in turn means one or other of the nine rights specified in s. 21[10]. Among those rights is a right to take a particular quantity of fish from a managed fishery. A "fishing concession" means a statutory fishing right, a fishing permit or a foreign fishing licence [11]. A "fishing permit" is a reference to a permit granted under s. 32 of the Act[12].

8. In general terms sufficient for this case, a person may not engage in commercial fishing in the Australian fishing zone ("AFZ") unless the holder of a fishing permit or acting on behalf of a holder of fishing permit. In broad terms, the AFZ comprises the waters adjacent to Australia within the outer limits of the exclusive economic zone[13] adjacent to Australia's coast and the waters adjacent to each external territory within those outer limits[14]. It does not include State proclaimed waters but the Commonwealth may make an arrangement with a State with respect to a particular fishery in waters that are relevant to that State and that are not managed by a Joint Authority[15].

9. Section 32(1) provides that, upon an application's being made to it in an approved form, AFMA may grant a person a fishing permit. Subject to certain provisos dependant upon whether a boat is specified in the fishing permit or not[16], that permit authorises the person to whom it is granted (or a person acting on his or her behalf) to use an Australian boat for fishing in a specified area of the AFZ or in a specified fishery[17]. The boat must comply with any conditions to which the fishing permit is subject[18]. The fishing permit may authorise the use of a boat for various activities specified in s. 32(4) including commercial fishing generally[19].

10. Section 32(5) provides that a fishing permit is granted subject to a number of conditions that are specified in that provision. AFMA may not vary those conditions [20]. In addition to those conditions, a fishing permit is subject to any other conditions that are specified in the permit itself or prescribed in relation to permits granted under s. 32[21]. The conditions that may be specified in a fishing permit include, but are not limited to:

(b)

the quantity of fish that may be taken; or

(c)

the rate at which fish may be taken; or

(d)

the methods or equipment that may be used to take fish; or

(e)

the methods or equipment that may be used to process or carry fish."[22]

11. If the holder of a permit surrenders the permit by giving AFMA written notice, that permit ceases to be in force[23]. With one exception, AFMA may transfer a permit to a person other than its holder if the holder and that other person ask it to do so[24].

12. Once a fishing permit has been issued, AFMA may vary or revoke a condition to which it is subject by virtue of s. 32(5). It may also specify a condition or a further condition[25]. If AFMA wishes to take either of these courses, it must give written notice to the holder of the fishing permit and it may do so at the request of the holder of the fishing permit or at its own instigation[26].

13. Section 95(1)(d) provides that the holder of a fishing permit must not contravene a condition to which that permit is subject and s. 95(1)(e) provides that he or she must not cause or permit a person acting on his or her behalf to contravene such a condition. Similarly, a person acting on behalf of the holder of a fishing permit must not contravene such a condition[27]. Contravention is an offence[28]. If AFMA has reasonable grounds to believe that there has been a contravention of a condition on a fishing permit, it may suspend the operation of that fishing permit in accordance with s. 38[29]. If the holder of a fishing permit is convicted of an offence against the Act, Regulations or any other law of the Commonwealth, Papua New Guinea or an Australian State or Territory relating to fishing, AFMA may cancel the fishing permit[30]. It may also cancel it if to do so would be in accordance with a condition of the fishing permit relating to its cancellation[31].

14. A decision under s. 32 is a "relevant decision" for the purposes of s. 165(1) of the Act. By complying with the requirements of ss. 165(2) and (4), "A person affected by a relevant decision ..." may ask AFMA to reconsider the decision. A "relevant decision" includes a decision it has made under s. 32. If AFMA makes a decision on review either in substitution for or revoking the relevant decision (i.e. its "reviewable decision", ss. 165(1) and (5)), it must inform the person who made the request under s. 165(2) of the result of its reconsideration (s. 165(6)). Section 165(7) then provides that:

"An application may be made to the Administrative Appeals Tribunal for a review of a reviewable decision." (s. 165(7))

Development of management plan for the SSF between 1992 and 1996

15. Since AFMA's inception on 3 February 1992[32], it has managed the SSF first under the Fisheries Act 1952[33] and then under the Act. Previously, it was managed by the Department of Primary Industries and Energy under the Fisheries Act and was known at one time as the Southern Shark Gillnet Fishery.

16. Before January 2001, the SSF was located only in waters that were adjacent to South Australia, Tasmania and Victoria and located in the AFZ. Bearing in mind the definition of the AFZ, this meant in practice that AFMA managed the SSF in waters that extended from a point beginning 3 nautical miles from Australia's shore and ending 200 nautical miles from that shore. The SSF related to all species of demersal shark taken commercially by demersal gillnet and demersal hook fishing methods in the AFZ. The principal target species were gummy shark and school shark. Regulation of the taking of demersal shark in State proclaimed waters was managed by the relevant department or agency in each of South Australia, Tasmania and Victoria.

17. With effect from 28 February 1986, the entry of boats to the SSF[34] to gillnet sharks was limited to those who held a shark-endorsement on their Commonwealth Fishing Boat Licence ("CFBL") [35]. Although the limit was imposed as an interim measure, it was imposed pending the implementation of a longer term plan. The Southern Shark Fishery Management Plan 1988 ("SSF88") was ultimately developed for the SSF under the Fisheries Act and it came into force on 29 April 1988[36].

18. The management tools used under SSF88 controlled the input that was made into the SSF in the form of the number of operators licensed to fish and the number of nets that they could use. They did not control the output of the SSF in that they did not, for example, control the catch that could be landed. Operators who satisfied the entry criteria were categorised as being entitled to either a Category A or a Category B gillnet endorsement on their CFBL according to the following criteria:

Generally assigned to boats with a total shark catch equal to or greater than 45 tonnes during any three of the five years prior to 25 September 1984[37]; and

Generally assigned to boats with a total shark catch less than 45 tonnes during any three of those five years.[38]

Initially, operators with a Category A endorsement were each allocated six nets. A net was 600 metres in length and 20 meshes deep or any combination of length and depth that gave the same mesh area. Under SSF88, Mr Howard was categorised as holding a Category A endorsement and was permitted to have 6 nets. He was referred to as an A6 gill netter holding an A6 permit.

19. Transfers of endorsements were permitted under SSF88 but only in two situations[39]:



Transfers were permitted under the gillnet amalgamation scheme which allowed the holders of Category A endorsements to amalgamate provided they did so within the first two years of SSF88's operation[40]. On amalgamation, the holders of two Category A endorsements were required to forfeit two nets so that they were only entitled to use 10 nets. They were known as A10 gill netters.



Transfers were permitted to the spouse or to the natural or adoptive grandparents, parents, siblings, children or grandchildren of the holders of endorsements or of their spouse.

In all, 80 operators took part in the amalgamation scheme. As a result, 40 operators became A10 gill netters and 40 others left the SSF. The Federal Government had paid $2.3 million as part of a programme to adjust from input controls in the SSF to output controls. The value of an A10 permit was $80,000.

20. In February 1988, the Southern Shark Fishery Management Committee ("SharkMAC") was established to advise the Minister[41] on the management of the SSF and as a forum to promote discussion on management and research in the SSF. It comprises representatives from the Commonwealth and State Governments and industry as well as scientists.

21. In November 1990, the Southern Shark Research Group concluded that the controls that had been introduced under SSF88 were ineffective in cutting back the fishing effort and shark landings to the 1982 level. Unless catches in the SSF were reduced to somewhere between 500 and 1,000 tonnes, the fishery face collapsed[42]. As a result, the Australian Fisheries Service established the SSF Structural Adjustment Task Force in March 1991. That Task Force examined ways to address continuing overcapacity in the SSF and SharkMAC considered options to reduce effort put into the SSF. On 6 December 1991, the Australian Bureau of Agricultural and Resource Economics ("ABARE") released a paper entitled Management Options for the Southern Shark Fishery[43]. ABARE outlined the choices that were available: either reduce the catch to a level where it was sustainable or temporarily reduce the catch to an even lower level so that future landings and profits can be increased. In so far as school sharks were concerned, the optimal outcome would be to close the SSF for eight to twelve years to allow the stock to recover. Alternatively, areas of the SSF could be closed and there could be restrictions on gear type and mesh size to reduce catches of school sharks to a sufficient level to allow stocks to recover. The same optimal outcome was recommended for gummy sharks. If that were not appropriate, the fleet should be reduced to approximately 20 boats while maintaining then current catch levels.[44]

22. In June 1996, AFMA commissioned Fisheries Economics, Research & Management Specialists ("FERMS") to report into future management options for the SSF. FERM released a report entitled Future Management Options for the Southern Shark Fishery in early 1997. FERMS noted that the inability to transfer endorsements in the SSF had inhibited economic efficiency in that fishery. It also canvassed the need for profound jurisdictional rationalisation and concluded that a properly designed and implemented Individual Transferable Quota system ("ITQ system") would offer a number of advantages over tighter input controls[45].

23. The Shark Fishery Assessment Group ("SharkFAG") prepared a report for SharkMAC in November 1996[46]. It estimated that, at the beginning of 1995, the biomass of school shark in the SSF lay between 15% and 46% of the unfished level in the SSF. SharkFAG predicted that there was a high probability that the then current effort in the SSF would lead to further reductions in the population size of school shark. If there was to be an 80% probability that mature biomass would be above the 1996 level of mature biomass in 15 years, there would need to be a catch reduction in the order of 35%. The required reductions could be phased in but that would result in a lower long-term sustainable catch.[47]

24. Mr Howard was one of those who took part in the amalgamation scheme under SSF88 by purchasing another A6 gillnet permit from Mr Roger Barling in April 1990. He then became an A10 gill netter holding an A10 permit in the SSF. As part of the package that he purchased from Mr Barling was a Tasmanian Fishing Boat Licence ("TFBL") No. 12779. The TFBL authorised Mr Howard to fish using 10 gillnets in Tasmanian state waters[48] while his A10 permit authorised him to fish for shark in Commonwealth waters. Mr Howard placed the TFBL first on the Opal Star and, in 1993, on the Bronze Wing.[49] On the basis of Mr Howard's evidence, I find that he put the A10 permit on the Opal Star. From the time that he put the TFBL on the Bronze Wing, he did not use it[50].

25. As a result of changes that had been introduced in April 1990[51], operators in Tasmanian coastal waters had to hold a Tasmanian Shark Gillnet Licence ("TSGL"). Operators had to apply for a TSGL by 1 June 1995. Operators could obtain a TSGL if they held both a TFBL and a Commonwealth gillnet licence or could demonstrate an annual shark catch history in excess of 15 tonne for any of the three years in the years between 1982 and 1987[52]. The number of nets endorsed on the TSGLs issued to the holders of Commonwealth permits equalled the number endorsed on their Commonwealth permit.[53] Two, three or four nets were granted to those operators who held only a TSGL and not a Commonwealth permit. A shark gillnet was defined as a monofilament net with a mesh not less than 150mm, a depth not greater than 20 meshes and a headline not exceeding 600 metres. The original licence conditions stated that the number of nets endorsed on a TSGL issued to the holder of a Commonwealth shark endorsement would be the same as that endorsed by the Commonwealth.

26. Between July 1991 and July 1993, the Commonwealth first reduced the number of nets that operators could use and then restored their original entitlements. So, for example, those who could fish with 10 before July 1991 were reduced to seven nets in that month but restored to their original 10 in July 1993. Tasmania altered the conditions on its TSGLs to match the changes made in the Commonwealth. It restored the number of nets that could be used by operators holding a TSGL in 1994. At the same time, it adopted the maximum headline of 420 metres that could be used and operators were no longer permitted to use 600 metres as had previously been the case. Operators endorsed to use three nets or fewer could continue to use nets with a maximum headline of 600 metres. In June 1995, the Tasmanian Minister for Primary Industry and Fisheries stated that the applications for TSGLs were closed[54].

27. As I have said, Mr Howard held a TFBL after purchasing it, together with an A6 permit from Mr Barling in April 1990. He had placed it first on the Opal Star and, from 1993, on the Bronze Wing. Mr Howard contacted the Tasmanian Department of Primary Industry and Fisheries ("Tasmanian DPIF") in early April 1996 to renew his TBFL and his TSGL for the Bronze Wing for the licensing year 1996/1997. He was told that his licence package did not include a TSGL and he had been paying the renewal fee each year for a TBFL alone.

28. At the time, Mr Howard's TFBL was held in abeyance as it was not assigned to a boat. He had been entitled to apply for a TSGL but the Tasmanian DPIF had not received his application by the closing date on 1 June 1995. On the basis that it might have made an administrative error in overlooking any application Mr Howard might have made, that department granted him a TSGL endorsed to use 10 gillnets with a maximum headrope length of 4,200 metres in all[55]. It did not specify any species of shark that could or could not be caught but did state that the licence was non-transferable and could only be operated by the licence holder. The TSGL was issued to him on 29 April 1996.

29. According to records maintained by the Marine and Freshwater Resources Institute, Mr Howard caught shark in 1991 and 1992 with a boat licence no. XGE and from 31 December 1997 with the Margaret Pearl[56]. That accords with Ms Sachse's evidence that the same is shown by the Southern Shark Fishery Monitoring Database and the Victorian Catch and Effort Database. In light of that and on the basis of Mr Howard's evidence, I find that he used his TSGL to catch shark on the Margaret Pearl. I also find that between January and August 1997, he had fished for rock lobster, crab and octopus on the Rita K and not on the Bronze Wing or the Margaret Pearl[57].

30. On 5 August 1996, Mr Howard wrote to AFMA asking that he be permitted to transfer his A10 permit and vessel[58]. Mr Howard noted that he had held the A10 permit for 10 years. During that time, his wife had become ill and he had been required to be at home daily to care for her. His shark fishing operations had earned only enough for him to purchase his partner's share of the boat, the Opal Star. He would have preferred to sell his shark fishing business to his shark fishing manager but was prevented from doing so by the permit's not being transferable. In the meantime, he was involved in the lobster fishing industry but his finances had deteriorated as had his wife's health. He asked AFMA for permission to transfer the permit so that he could take employment that permitted him to return home each day to care for his sick wife.

31. In a telephone call he made to AFMA, Mr Howard was advised that its policy had been to approve leasing of permits on medical grounds and then only for two years[59]. If he wanted to lease his permit, he needed to explain why he could not or did not want to appoint a skipper to fish on his behalf and to provide further medical material about his wife's condition[60]. Mr Howard provided further material in a letter dated 18 September 1996[61].

32. On 5 November 1996, Mr David Johnson, the then Acting Manager of the SSF, noted that Mr Howard had telephoned him to say that he would have to engage a skipper as he could not go to sea later that month. Mr Johnson noted that Mr Howard was clearly upset as his wife's condition had worsened. When Mr Howard asked him how he nominated a skipper, Mr Johnson wrote that he told him that he would prepare a file note on his behalf and send it to AFMA's licensing section. He did so and advised the licensing section that Mr Howard's nominated skipper was Mr Brian Tee on the Opal Star in relation to his A10 gillnet permit[62]. On

7 November 1996, AFMA approved Mr Howard's request to sell his A10 permit on condition that:

" the package of fishing concessions, both State and Commonwealth would be transferred in its entirety and not be split apart. Consequently you will also need the approval of the appropriate State Fisheries Agencies,



the transfer will not result in the amalgamation of your package of fishing concessions with another persons [sic] package of fishing concessions which contains an entitlement to the southern shark gillnet fishery,



the exemption to sell you licence outside the family would lapse one year from the date of this letter or on implementation of a Management Plan for the fishery, which ever comes first, and



the transfer is a once only sale, ie the person that purchases the licence package has purchased a non-transferable licence until such time as transferability is introduced into the fishery generally."[63]

33. Based on his solicitors' letter and on his own evidence, I find that Mr Howard instructed his solicitors to accept the conditions to the transfer outlined in AFMA's letter. They advised that Mr Howard held no licences held in South Australia and that his Victorian boat registration licence was in the process of being transferred. His solicitor advised that he had "... investigated the licensing position in South Australia and Victoria"[64]. No mention was made of Tasmania or of the TSGL. Mr Howard's solicitor went on to write:

"Consequently we do not expect any difficulties relating to the transfer of the package in its entirety.

The transfer will not result in the amalgamation of Mr Howard's entitlements with anyone else, and Mr Howard appreciates that the transfer is a once only sale, and the purchasers acknowledge that the licence package is non transferable until such time as transferability is introduced into the Fishery generally."[65]

34. Mr Howard signed the transfer on 18 November 1996[66]. He noted that the Opal Star was being transferred with the A10 permit. When asked to tick the States in which licences or entitlements were held in respect of the Opal Star, Mr Howard ticked "VIC" and noted that he had made an application to transfer the State licence[67]. Again, there was no mention of the TSGL. The proposed master was Mr Brian Tee. On 16 December 1996, AFMA asked the Tasmanian DPIF if it held an interest in the compassionate transfer from Mr Howard. The request was made by facsimile message but followed by a telephone call to the Tasmanian DPIF. An AFMA officer noted that the Tasmanian DPIF did not have an interest in the transaction[68].

35. Mr Howard transferred his A10 permit to Opal Star Fisheries Pty Ltd ("Opal Star Fisheries"). Mr Howard did not transfer the TSGL[69].

36. In April 1997, SharkMAC recommended the introduction of ITQs in the management of both school and gummy shark on condition that:



there be an Offshore Constitutional Settlement ("OCS") establishing a single management authority acceptable to Commonwealth shark fishers and underpinned by an Memorandum of Understanding acceptable to SharkMAC;



input controls to enhance harvesting of school shark be retained;



those operators who caught school shark but did not have an entitlement to do so be placed on bycatch limits to restrict their catch of school shark; and



there be an independent panel to undertake the allocation process.[70]

37. AFMA endorsed the recommendation and at its meeting in May 1997 and announced that it would implement a system of ITQs subject to its being supported by the wider industry[71]. Operators were warned against increasing their future catches in the SSF in the hope that they would receive larger quotas in the future. Catches recorded after 10 April 1997, the first day of SharkMAC's meeting, would not be taken into account.[72]

38. On 30 June 1997, the Tasmanian Minister for Primary Industry and Fisheries issued a complementary Media Release. He indicated that various options were being considered to manage the SSF and that operators were likely to face restrictions. He assured Tasmanian operators that the Tasmanian Government would satisfy itself that they would be treated fairly and equitably in comparison with operators currently fishing in other jurisdictions[73].

39. In July 1997, AFMA and the South Australian, Tasmanian and Victorian fisheries agencies registered a proposal for the introduction of ITQ management under a single jurisdiction for both school and gummy shark in the SSF[74]. Also in that month, AFMA authorised its management to pursue ITQs as the basis for future management of the SSF under the Commonwealth's jurisdiction provided the Ministerial Council agreed. The Ministerial Council endorsed the proposal on 25 July 1997.

40. AFMA issued Fisheries Paper Number 8 - Allocation of Fishing Concessions Where Management Arrangements Change[75] ("FMP No. 8") in September 1997. It addressed AFMA's objectives as prescribed by the Act and how the change from one management regime to another would be achieved. As a result of one of its recommendations, the Southern Shark Allocation Advisory Panel ("SSAAP") was established in early 1999.

41. The SSAAP consulted with Commonwealth and State fishing concession holders and held nine public meetings in three States. It then prepared a report dated 15 July 1999 on the matters contained in its Terms of Reference[76]. The SSAAP recommended that all permit holders in each of the SSF, the South East Trawl Fishery ("SETF") and the Great Australian Bight Trawl Fishery ("GABTF") and each of the six sectors within the SSF [77] be apportioned a share of the total allowable catch ("TAC"). That share would represent the fishery's or sector's proportionate share of the aggregate catch of each species taken during the period from 1 January 1994 to 31 December 1997[78]. SSAAP recommended that the apportionment period should be for four years from 1 January 1994[79]. The length of the period was chosen so that the relative economic positions of operators could be accurately reflected and any short term distortions flowing from such matters as varying aggregations of shark and weather conditions would be obviated[80]. The SSAAP concluded that an individual operator's recent shark catch is the best available measure of that operator's relative economic position with regard to shark fishing. Operators may be engaged in other fishing activities but those activities were not taken into account.[81]

42. The SSAAP recommended that the allocation of ITQs to individual concession holders be proportional to the relative aggregate catch of each during the best three years in the period 1994 to 1997. This recommendation was based on an assumption that it would best obviate any distortions in operators' lives caused by circumstances peculiar to them.[82]

43. The SSAAP recommended that a share of the TAC should be allocated to all permit holders in the SSF before, rather than after, the apportionment of the TAC among the sectors. Once ITQs had been allocated, the quota held by single permit holders would be counted as part of their apportioned share of the sector in which the permit was held. If an operator held a permit authorising fishing in more than one sector, that operator would be required to assign quota to one of the sectors or apportion his quota between sectors.[83]

44. AFMA accepted SSAAP's recommendations regarding the apportionment and allocation of ITQs for school and gummy shark on 30 August 1999[84]. Shortly after, on 6 September 1999, it wrote to all shark operators and interested persons, including Mr Howard, informing them of its decision. Enclosed with the letter was a summary of the verification process for demersal shark species including school and gummy shark. AFMA invited shark operators to apply for an allocation of quota in the expanded SSF[85]. It then approved the introduction of school and gummy shark ITQ management in Commonwealth waters and the implementation of shark quota management on a calendar year basis beginning on 1 January 2001[86]. That occurred on 27 October 2000.

45. On 7 December 2000, AFMA decided that the 2001 TAC for the enlarged SSF, SETF and GABTF would be 390.38 tonnes of carcass weight for school shark and 2,074.17 tonnes carcass weight for gummy shark[87]. It also decided that the quota granted as a result of a successful internal review during 2001 would be in addition to the TAC and that any permanent quota unit increases would be absorbed within the TAC allocations for subsequent years[88].

46. In late 2000 and early 2001, the Commonwealth, South Australia, Tasmania and Victoria signed an OCS on the basis that the SSF was partly in the coastal waters[89] of those States. That is to say, the SSF extended to include all the waters beginning at Australia's shoreline and ending 200 nautical miles offshore. The OCS came into operation on 1 January 2001 for Victoria and earlier, in December 2000, for South Australia and Tasmania. The extended SSF was administered by AFMA.

47. The Commonwealth and the three States also entered a Memorandum of Understanding ("MOU") with respect to school and gummy shark fishery in waters relevant to those States. It came into effect on 7 March 2001. Under that MOU, AFMA agreed to restrict Commonwealth, Tasmanian and South Australian operators to their area of access as stated on their previous fishing concession. AFMA agreed to retain the status quo in relation to the gear entitlements of both Commonwealth and State operators.

48. On the basis of Ms Sachse's evidence, I find that there are currently 197 operators fishing with a package of permits and licences in the SSF since the OCS. Approximately 60 of those are State operators who were picked up as a result of the OCS. Those State operators came only from South Australia and Tasmania. None was from Victoria as there had been no targeted shark fishing in Victorian State waters.

49. On 4 September 1999, Mr Howard lodged a Claim for Shark Catch History in relation to school and gummy shark caught using his TSGL on the Margaret Pearl[90]. Having regard to FT weight[91], Mr Howard recorded that he had caught in the Tasmanian fishery 50 kilogrammes of school shark and 1,144 kilogrammes of gummy shark in 1997[92]. Later, on 8 May 2000, AFMA accepted his claimed catches as attributable entirely to his catch of gummy shark so that his verified catch was 1,194 kilogrammes of gummy shark and 0 kilogrammes of school shark. Mr Howard accepted that assessment[93].

50. On 30 July 2001, AFMA issued fishing permit 27008 to Mr Howard in respect of the SSF and for the period 25 July to 31 December 2001[94]. He was authorised to use 10 gillnets in the coastal waters relevant to Tasmania but no boat was nominated on the permit. The permit was subject to a number of conditions set out in Schedule 4 and Attachment B to it. Among those conditions was that the total trunked weight of gummy shark taken by Mr Howard was less than 444 kilogrammes. He was not permitted to take any school shark.

51. On 25 August 2001, Mr Howard sought review of this decision and gave reasons for his doing so on 19 September 2001[95]. AFMA affirmed its decision on 18 December 2001[96].

Mr Howard's fishing activities before he asked AFMA to transfer his A10 permit in August 1996

52. In cross-examination, Mr Howard said that he had paid Mr Barling approximately $100,000 to $120,000 for the A6 permit and the TBFL. He had purchased the two principally to upgrade his existing A6 permit. His principal motivation to enter the purchase had not been to acquire the TBFL. Earlier, in giving evidence, Mr Howard had said that he held did not use TBFL for sometime. In giving evidence, he said that he never used that licence until approximately 1996 when he telephoned the Tasmanian fisheries authority to ask what he had on his licence and whether he could use hooks or nets. Over the telephone, he was told that he had 10 nets on his licence. If he sent in the appropriate money, he would be qualified to fish those 10 nets. He sent in that money. In cross-examination, he said that he had not used the TBFL because Tasmania was too far away when he was fishing out of Robe in South Australia.

53. In cross-examination, Mr Howard said that he went shark fishing in the early to mid 1990s on his boat, the Opal Star. When asked where he operated from, he replied Robe, Port MacDonnell, Portland, Port Fairy or elsewhere but that he could not remember. When asked if he was fishing in Victorian waters, he replied that he most probably fished anywhere. He also held a Victorian licence at the time as well as a Tasmanian licence but his Victorian licence did not permit him to fish for shark within three miles of the coast in Victorian waters. He would carry only shark fishing gear on the Opal Star and that was the case in 1996 when he asked AFMA for permission to transfer his licence.

54. At the time he wrote to AFMA, he was going out for week long trips shark fishing but he had been advised to stay at home for the sake of his wife's health. At the time, he owned boats other than the Opal Star but did not have licences for them. Those boats included the Bronze Wing and the Rita K but not the Margaret Pearl. The Margaret Pearl came later. He had purchased the Bronze Wing for $40,000 and the Rita K for $25,000.

55. The Bronze Wing was a former cray/shark boat that was "pretty run down" when he purchased it. He had a five net shark licence on that boat and was using it before he asked AFMA to transfer the licence. Mr Howard said that he never had an A6 permit on the Bronze Wing, which was moored at Robe. The Rita K was a cray boat only but could have been modified to become a small shark boat. The boat was 10 metres in length, Mr Howard said. He had had the Rita K re-surveyed after he and the Tasmanian DPIF had disagreed over its length. Had it been less than 10 metres, he would have lost a number of nets and the boat would have been in a different category.

56. In 1996 when he wrote to AFMA, Mr Howard said that he had been both shark and cray fishing. For a time, he ran the Bronze Wing but he later retained a skipper, Mr Gavan Elliott, for it. Mr Howard could not recall precisely when Mr Elliott started to skipper for him. He thought that it was way before 1996 when he wrote to AFMA. Back in the 1990s, Mr Elliott was catching shark.

57. The Opal Star is a 60 foot steel boat built for shark and cray fishing. In the main, it operated from Robe. Although he had a skipper at one stage, he operated it himself. That was between approximately 1990 and 1993 or 1994 but he ended up working on another boat for a while. Things had nearly started to get back to normal when he asked AFMA for permission to transfer his Commonwealth licence. At the time that he asked, he did not have a skipper. The licence was on the Opal Star. He had an arrangement with a fishing manager, Mr Brian Tee and Mr Tee had previously skippered for Mr Howard on the basis that he received a share of the catch.

58. Ms Sachse said that Mr Howard's TSGL was based on his having an A10 permit and not upon his having a catch history over 15 tons in the qualifying period. Had it been based on his catch history, he would have been given a TSGL with an 1,800 metre limit. As it was based on his A10 permit, he was given 4,200 metres.

59. Ms Sachse said that Mr Howard's transferring the TSGL from the Opal Star to the Bronze Wing accorded with the national licence splitting policy. Since 1990, fishermen had needed both a Tasmanian and a Commonwealth licence if they were to fish in Tasmanian coastal waters. That was the Tasmanian DPIF's policy and it is not dissimilar to the current Western Australian policy.

60. Mr Howard said in giving his evidence that he heard a lot of talk about the introduction of quotas into State waters. That was in 1997. He did not follow the debate as he did not know until after 1996 that the States were adopting ITQs. He knew that he had ten nets and sent his money away for the TSGL. In cross-examination, Mr Howard said that he could not recall anything of his discussions with the Tasmanian DPIF other than being told that he had 10 nets. He renewed it each year on the payment of a $300 fee. The licence "sat on the shelf" but was then placed on the Bronze Wing before being placed on the Rita K.

61. When asked why he had not sought transfer of the Tasmanian licence at the time he applied for the transfer of his A10 permit, Mr Howard replied that the TSGL had nothing to do with the Opal Star. The TSGL was on Bronze Wing. The fact that it was not transferred was not his fault. He went through the Tasmanian fishery authorities and they told him that he was qualified for 10 nets. He had not had 10 nets on the Bronze Wing but only five. He leased a five net Commonwealth licence from another operator and used that for Commonwealth waters. He put the TSGL on the boat but he never fished in Tasmanian waters.

62. It was Mr Tee, in his role with Opal Star Fisheries, who took over the licence after AFMA gave its approval. Mr Howard did not know who else was involved in that company. Mr Howard said that he sold the Opal Star and the A10 permit for approximately $400,000. He was not "100% sure" whether he received about $200,000 for each of the licence and the boat. Mr Howard agreed that the amount he sold his A10 permit for included the value of the catch history associated with it.

63. As part of the national licence splitting policy, each Commonwealth and State agency examines a proposal to transfer a permit. They contact each other to check whether the other had an interest in the transfer. In the case of Mr Howard's request for transfer, AFMA had written to both the Tasmanian DPIF and the Victorian authorities[97]. The application was described as one to transfer Mr Howard's current Commonwealth permit on the Opal Star to Opal Star Fisheries. Each was asked to advise if it had any interest in the transfer. The Tasmanian DPIF responded that it had no interest. The Victorian authorities responded that they only had a boat registration attached to the Opal Star and had already received payment for a transfer of that registration to Opal Star Fisheries.

64. Ms Sachse said that the Tasmanian DPIF had looked at its records and seen only a TBFL and not a TSGL. It had not come into being until April 1996. She could offer no explanation as to why Mr Howard's solicitors would have notified AFMA of Mr Howard's Victorian licence and not his Tasmanian. The Victorian licence equated with the TSGL. The only explanation was that it was attached to another vessel. Had the TSGL been drawn to AFMA's attention, it would have investigated the matter further, she said. AFMA would have required its transfer as part of the package of licences it permitted to be transferred on compassionate grounds. The TBFL had been part of the package that Mr Howard purchased from Mr Baring and it, together with Commonwealth permit, was the basis on which Mr Howard was granted a TSGL. That is also evidenced by his being granted 10 nets with maximum headrope length of 4,200 metres in all. Had he not held a Commonwealth permit, he would have been granted fewer nets with a shorter headrope length.

65. When the ITQs were allocated, Ms Sachse said, Opal Star Fisheries were allocated 11,274 kilogrammes of school shark and 17,631 kilogrammes of gummy shark. The allocation was based on the catch history attached to the A10 permit. Had Mr Howard not transferred the A10 permit he, and not Opal Star Fisheries, would have received that allocation.

66. Ms Sachse said that a little over 20 people had transferred their licence packages since the end of 2003 and after the introduction of ITQs. Whole packages had to be transferred so that they and AFMA would not "have to unscramble the egg".

Mr Howard's fishing activities after the transfer of his A10 permit

67. Mr Howard said that he started sharking again with the Margaret Pearl approximately a year after he signed the transfer of his A10 permit on 18 November 1996[98]. In the meantime, he had been crayfishing in the Rita K in Victorian waters. This was the period in which his wife was not well. He would be home a little after lunch time each day. He leased a crayfishing licence.

68. In July 1997, Mr Howard said that he sold the Bronze Wing for $60,000. He did not sell the TSGL and put it to "No Boat". He did not use the TSGL again until, towards the end of 1997, he purchased the Margaret Pearl. At that time, the owner of the cray licence he was using wanted it back. He had only leased it for 12 months. He knew that he had to use his TSGL or lose it and that was the reason for his purchasing the Margaret Pearl. His preference had been to continue cray fishing. When he was unable to lease a cray licence, he decided to go back to shark fishing. His wife had good days and bad days but he felt pushed back into shark fishing because, if he did not use his TSGL, he would lose it. He regarded the TSGL as an investment or as property. The Margaret Pearl was a cray boat when he purchased her and he converted her to a shark boat. In cross-examination, Mr Howard thought it more likely that he purchased her in September 1997. She cost $150,000.

69. He fished between 1997 and 1999. Shark fishing was difficult for him as it required him to be away from his wife. He had to travel long distances to find the fish and he could not do that by taking day trips. It was a 20 hour trip to get from Portland to King Island. In cross-examination, he said that he was "not fishing his guts out" as he had been "feeling pretty crook" and three stents had been placed in his heart. He said that he was shark fishing in 1996/97.

70. In 1997, Mr Howard agreed, he attended port meetings regarding management changes in the fishing industry. He met Ms Sachse and Mr Johnson in 1998. While he was fishing in 1997 to 1999, he was not aware which years would be used on which to base catch history. He agreed that no-one knew that until 1999.

71. Mr Howard rejected the suggestion that the retention of his TSGL was a bit of windfall once he had sold his A10 permit. His TBFL and then his TSGL had been sitting for a number of years without being used. He could not put his son on a boat using that licence as it had to be used by the owner/operator. The licence was there until the day that he had to go back fishing. Mr Howard also disagreed with the proposition that the TGSL had been part of the Commonwealth package of licences. If it were, why was he allowed to transfer it in the first place? He HAD transferred it from the Opal Star. He rejected the proposition that he ended up with a licence to which he was not entitled. The Tasmanian DPIF transferred it, so it "must be OK". He did not know that he was running three times as many nets as any other Tasmanian operator. He did not regard himself as lucky to be permitted to fish with 10 nets each up to 420 metres in length rather than with merely three nets totalling 1,800 metres. He had asked what he was entitled to and had been given the TGSL. He did not discover the difference between his licence and that of other Tasmanian operators until he attended a public meeting.

72. When asked whether he thought that was fair compared with other fishermen, Mr Howard replied that they all look after themselves. If a fisherman can get a gain out of a fishery, that fishermen will. At the public meetings held by AFMA, fishermen got up and looked after themselves. They did not worry about the others and were only there to get what they could out of it. Mr Howard said that he did not think that AFMA tried to do what was fair between fishermen. What happened was not his fault. The licence had been issued to him. Had the Tasmanian DPIF told him that the TSGL should have stayed on the Opal Star and that it was a mistake that it was put on the Bronze Wing, he would have had to wear it.

73. Mr Howard disagreed that his TSGL gave him an advantage over other Tasmanian operators who could only use three nets totalling 1,800 metres. He said that he could only pull his 10 nets twice a day but a fisherman with three nets could pull them three or four times a day. That fisherman had to do more work but could also catch a lot more fish, he said.

74. Since he received his ITQ, Mr Howard said, he had not fished on his TSGL. He could not fish for one day and live from that. Instead, he has fished on another permit and has shared the catch with the owner of that permit. He did that during 2001, 2002 and 2003.

75. Ms Sachse said that all the Tasmanian operators who came into the extended SSF with the OCS came with 1,800 metres of gillnets. Mr Howard was the only Tasmanian operator with 4,200 metres of gillnets. About 20 operators have 4,200 metres of gillnets but they also held a Commonwealth permit. The Tasmanian operators all had the same length inside and outside their coastal waters because it was easier in so far as compliance is concerned. The weather is so atrocious in that region that it is easier to have the same gear wherever the fisherman is.

Mr Howard's reasons for seeking an increase in his ITQ

76. Mr Howard said that, after he was given his quota of 444 kilogrammes, he sold his boat as he was suffering from a lot of stress. It was his understanding that licences were property and owned by the operator.

77. There was talk in 1997 of the introduction of quotas. At that time, he was virtually told that if he did not use his licence, he would lose it. Consequently, in 1997, he purchased a boat and had the licence put on that boat.

78. Mr Howard said that he was never informed that ITQs would be introduced into Tasmanian waters. It was always said that they would not be unless everyone was treated fairly and equally. He did not feel that he had been treated in that way.

79. Mr Howard considered that his ITQ should be assessed on the basis of his catch history from 1997 until the commencement of ITQs i.e. the end of 2000. That was on the basis that he could not fish before that period because of his personal circumstances. It was his only income and he had done everything legally. In cross-examination, he agreed that the overall effort in the SSF increased when he separated the State and Commonwealth licences by placing the TSGF on the Bronze Wing and left the Commonwealth permit with the Opal Star.

80. Mr Howard suggested to Ms Sachse that she had "it in for" him and had done so since 1993 when AFMA had investigated him and his boat in Port Lincoln. Ms Sachse noted that he was one of 10 operators under investigation at that time regarding compliance with their licence conditions. All had been asked to show cause why they should not be regarded as being in breach of the non-transferability conditions of their permits.

81. Mr Howard said that others could do the wrong thing but that AFMA was always telling him what was right and what was wrong. Honest people did what they could and he did what he had to do. His wife's health comes before anything else. AFMA did not have the right to judge him because of his wife's health. Ms Sachse said that AFMA had tried to assist him as much as it could by approving the compassionate transfer. Many people applied to AFMA to transfer their permits at the time but only three, of whom Mr Howard was one, were approved.

82. Mr Howard felt that he had no alternative but to apply for the TSGL. He had done everything by the book. It was not his fault that there had been a "mess up". It is his income that is at stake. Ms Sachse said that AFMA must look at fairness. Other Tasmanian operators had only 1,900 of headrope length for their nets. Mr Howard said that he had not been aware of what Tasmanian operators had until he went to a meeting. Ms Sachse said that Commonwealth permit holders could fish in Tasmanian waters. An operator holding only a TSGL and not a Commonwealth permit was limited to nets with a headrope of 1,800 metres. It was unfair that Mr Howard could fish with a TSGL and with no Commonwealth permit by using nets with almost 21/2 times the headrope of another Tasmanian operator with a TSGL alone. AFMA takes an holistic approach. The Commonwealth permit is part of a package. AFMA gave its approval to a compassionate transfer of that package. Mr Howard received payment for that transfer. Mr Howard only had one opportunity to participate in the allocation process. One arose because he operated in the qualifying period but he had sold his Commonwealth permit and could not take advantage of that. It had been taken into account in assessing the ITQ for Opal Star Fisheries. The other arose for Tasmanian operators with a headrope length of 1,800 metres.

83. Mr Howard suggested to Ms Sachse that it was not the length of net that mattered but the way the nets were worked. A mile of net could end up with no fish but run less and catch a ton. Ms Sachse did not agree as much depended, she said, on the weather conditions. Weather conditions will both prohibit the setting of smaller amounts of net and prevent their being pulled several times a day. Generally, the more net, the greater the catch.

Southern Shark Fishery Industry Development Programme

84. In a letter dated 2 May 2002, Mr Glenn Hurry, the General Manager of the Fisheries and Aquaculture Branch of the Commonwealth Department of Agriculture, Fisheries and Forestry wrote to Mr Howard about the Southern Shark Fishery regarding the SSF Industry Development Programme ("IDP"). Mr Hurry wrote:

"In your letter you suggest that it is 'unfair and unjust' that a person who held a Commonwealth licence and quota was able to surrender their licence under the IDP and retain their quota to sell or lease, while a State licence holder, only received a fixed fee for the surrender of their licence.

The purpose of the IDP was to facilitate the transition to quota management within the SSF and reduce effort in the fishery through the removal of entitlements. It should also be noted that the IDP was established to assist Commonwealth licence holders, not operators who held only a State licence. However, a Commonwealth licence-holder who accepted an offer under the IDP and who had an attached State shark licence was required to surrender this licence as part of the package. They were compensated for the surrender of the State licence through a $5,000 payment. If these dual endorsements had not been surrendered as a package, Commonwealth operators would have been able to continue in the fishery. Furthermore, these same endorsements could have been used to obtain a Commonwealth licence from 1 January 2001, as part of an Offshore Constitutional Settlement (OCS) arrangement with the States.

It is important to note at the time of the IDP, State licence holders were still under the jurisdiction of their respective States. As the IDP was funded entirely by the Commonwealth and occurred before jurisdictional changes under the OCS took place, there was no requirement for the Commonwealth to fund the removal of shark fishers operating under State only licences."[99]

Changes in policy due to challenges to AFMA's 2001 policy

85. Following the Federal Court's judgment in Australian Fisheries Management Authority v Graham[100], AFMA developed a new policy that took account of the value of Commonwealth permits in the SSF. AFMA viewed the judgment as affecting only permits in the Commonwealth sector of the SSF, Ms Sachse said. The policy was based on 2001 data but calculated in 2003 values as that was the year that the policy was revised. The value was based on a buy-back figure that had been in place from 1999 until March 2001. As the revisions affected only the Commonwealth sector of the SSF, Mr Howard was not affected.

86. In so far as policy is concerned, there are instances in which the Tribunal is bound to have regard to policy lawfully formulated by the Executive Government[101] and others as part of the factual matrix[102]. As Ms Mortimer SC submitted, this case requires me to consider whether I can have regard to AFMA's policy in reviewing the condition on Mr Howard's SSF permit and, if so, what that policy is. The policy that was followed in 2001 allocating Mr Howard the quota that formed one of the conditions of his SSF permit has been found wanting by Ryan J in the Federal Court. Ryan J had found that, in developing the policy, the SSAAP:

"... had proceeded on an assumption, contrary, as I have found, to the facts and the preferable legal analysis, that the permits were entirely non-transferable. ... Once it is acknowledged that the permits could be transferred, even in limited circumstances, or that there were rights which could be carved out and alienated by the permit holder for commercial advantage, it follows that there were considerations which AFMA should have taken into account, but did not, in allocating the new ITQs. That is not to say ... that those considerations should be decisive in arriving at the correct and preferable decision."[103]

I am bound by his Honour's judgment and so unable to apply the policy developed in 2001. At the same time, AFMA's 2004 policy is not applicable as it has been applied only to operators in the Commonwealth sector of the SSF and not to those operating only in State waters. Mr Howard would not draw the distinction between the two fisheries but I will return to that later in these reasons.

87. Even though the policies developed in 2001 and 2004 are inapplicable, that does not mean that the Tribunal is free to make its decision on any basis that it thinks fit. Certainly, in providing that a permit is subject to such conditions as are specified in the permit, s. 32(6)(a) does not place any apparent constraints upon AFMA's, and so the Tribunal's, discretion to specify conditions. There are, however, constraints and they are found by reference to the policy of the Act and its provisions[104]. That policy may, in some cases, also be gleaned from the extrinsic material such as the Minister's Second Reading Speech[105].

88. I have set out the Act's objectives above[106]. On their face, those objectives would seem difficult, if not impossible, to achieve in every case. That impression is consistent with the conclusion reached by Ryan J in Australian Fisheries Management Authority v Graham when he said of s. 3(1) that "The provision is exhortatory, and each objective cannot be pursued with equal vigour at one and the same time. ..."[107].

89. There is also a question whether AFMA must have regard to those objectives in setting permit conditions. That was a matter considered by Branson J in PW Adams Pty Ltd v Australian Fisheries Management Authority[108], Branson J considered whether AFMA must have regard to the objectives in s. 3, and in particular s. 3(1)(c), in considering the conditions to be specified in an individual fisherman's fishing permit. After analysing the Act and the Administration Act, her Honour concluded that:

"... it is a misreading of the Administration Act and the Management Act, to suggest that it is a function of AFMA, within the meaning of those Acts, to determine the conditions to be specified in any individual fishing permit under s 32 of the Management Act. AFMA has the power to determine such conditions (s 32(6) of the Management Act). AFMA has a discretion to exercise such a power in the performance of its function to grant fishing permits pursuant to s 32 of the Management Act. Such a discretion must be exercised by AFMA in such a way that, in the performance of its function granting fishing licences, it pursues the objective, among other objectives, of 'maximising economic efficiency in the exploitation of fishing resources'. ..."[109]

90. The distinction between AFMA's functions and its discretion to impose quota as a condition of issuing a licence to an individual operator was also considered by Branson J:

"Plainly, there is a difference between 'maximising economic efficiency in the exploitation of fisheries resources' and maximising the economic efficiency of individual participants in the fishing industry. The objectives of AFMA are objectives intended to be pursued in the public interest; they are not intended to require AFMA to pursue, assuming that it would be possible for it to do so, the separate interests of individual participants in the fishing industry. Of course, in many circumstances, the respective interests of individual participants in the fishing industry and the public interests which AFMA is required by its objectives to pursue in the performance or its functions will be consistent. In some circumstances they will not be consistent."[110]

As Ryan J observed, though, in the later case of Australian Fisheries Management Authority v Graham, that does not mean "... that the economic effect on participants in the industry is irrelevant to a decision to be taken by AFMA in the management of a fishery."[111]

91. In summary, while AFMA is not under any obligation to take into account the interests of individual operators in carrying out its functions according to the objectives in s. 3(1) of the Act, it will not carry out those objectives, or some of them, without having some regard to the interests of individual operators. It will not, for example, achieve its objective of maximising economic efficiency in the exploitation of fisheries resources[112] when changing the management of a fishery if its decision results in injustice to an individual operator[113] and that injustice is not supported by another objective[114].

92. I have used the word "injustice" because it is the word used by Ryan J in Australian Fisheries Management Authority v Graham. It is a word whose meaning is simple enough - a "... wrong; unfairness ..."[115]. But what is regarded as a wrong or an unfairness can vary so much from person to person. What is unjust to one person may not be seen that way by another. One person may suffer, or perceive to suffer, an injustice but others in a similar situation may not. In the context of the Act, whether there is injustice to the individual must be assessed by reference to the objectives governing the way in which AFMA's functions are carried out. As AFMA states in its FMP No. 8[116], any management changes must be made, among others, on the premiss that:

"any differential economic impacts of allocations on individual fishing concession holders are minimised unless there are reasons, justifiable with respect to AFMA's legislative objectives, that dictate otherwise."[117]

93. Mr Howard does not challenge the policy behind the way in which the ITQs have been allocated so much as to say that it should work differently in his case. The essence of his position is that he would like more quota because he missed out in the years that were considered by AFMA in setting quota i.e. 1994 to 1997. He wants to be treated equally with the other operators and wants to be able to make a living by fishing on his SSF permit.

94. In considering Mr Howard's submission, I have considered whether it is appropriate to begin from the basis that the ITQs should be allocated on a basis that pays any regard to an individual operator's being allocated ITQ by reference to the proportion that the aggregate of that operator's best three verified annual catches in the period 1994 to 1997 bears to the aggregate of all operators' best three verified annual catches in the same period. That is a basis that puts all operators on an equal footing in so far as output is concerned. It may or may not reflect the effort that each operator put into the SSF for it does not, for example, reflect the variations in weather conditions or gear difficulties faced by each operator. Effort, though, is not entirely irrelevant for the ITQs were introduced in a fishery which had already been subject to input controls in the form of limitations on the numbers and sizes of the nets that they could use. In that sense, setting the basis of the ITQs on a proportionate basis does have some regard to the economic efficiency in the exploitation of the resources in the SSF as required by s. 3(1)(c) of the Act. It does so in one sense of the expression "economic efficiency" in that it requires "... attention to be paid to returns likely to be derived from the catch ..." and "... to the resources - the capital and labour - required to produce the catch"[118]. No regard is paid to the wider issues that could come within the meaning of "economic efficiency" in the guise of the returns likely to be derived from the sale of the catch or the standard of equipment used in the industry or by individual operators in the industry other than the number and nature of the nets, used to take the catch. I do not have evidence on which I can take such matters into account in assessing the basis on which I should determine Mr Howard's ITQ. I can take into account only the number and nature of the nets used to produce the catch. That basis has an inherent assumption that all operators have an equal opportunity to catch shark using their nets. This inherent assumption is not inconsistent with the way in which "economic efficiency" has been interpreted by Drummond J in Bannister Quest Pty Ltd v Australian Fisheries Management Authority:

" There is, in my opinion, no support in the policy statement for arguing that s 3(1)(c) requires AFMA, in making relevant decisions, to do so on the basis of the relative efficiency of individual operators ... AFMA is required to direct its attentions to maximising economic efficiency in the exploitation of the resources of the particular fishery overall. This ... involves acting so as to facilitate increasing the aggregate profitability of the whole body of operators in a particular fishery."[119]

95. Section 3(1)(d) of the Act requires AFMA to ensure "... accountability to the fishing industry and to the Australian community..."[120]. This has been interpreted as requiring of AFMA "... only that it explain to the industry and the community its management of Australia's fishery resources. ..."[121]. That is required also of the Tribunal in reviewing decisions relating to individual operators forming part of that industry and so requires it to give reasons for its decision in a case such as this.

96. In the absence of any effective policy to which I may have regard, I have looked to what has happened in the SSF and in relation to the allocation of ITQs in that fishery. I have done that because the catch history Mr Howard wants me to take into account was taken in Commonwealth waters forming part of the now extended SSF. When I do that, I find that, from 28 February 1986, operators could not fish for shark in the SSF unless they had a shark-endorsement on the CFBL. In 1988, input controls were imposed on the SSF in the form of limitations on the number and nature of the nets that could be used to fish for school shark and gummy sharm. Mr Howard was given a Category A endorsement and so issued with an A6 permit. He obtained an A10 permit by amalgamating his A6 permit with another A6 permit that he purchased as part of a package with a TFBL from Mr Barling. That was in 1990. For the next three years or so, he placed the TFBL on the Opal Star. In 1993, he placed it on the Bronze Wing.

97. In the first half of 1996, Mr Howard relied on the fact that he held an A10 permit, that was still on the Opal Star as it always had been, and a TBFL, that was now on the Bronze Wing, to obtain a TSGL. The TSGL entitled him to fish in Tasmanian coastal waters. If this were practically possible, this meant that, before the OCS, Mr Howard could use the Bronze Wing to fish in Tasmanian coastal waters and the Opal Star to fish in the SSF.

98. That was the position when, later in 1996, Mr Howard sold the Opal Star and the A10 permit attached to that boat. He did not sell the TSGL as part of the package. It is clear from AFMA's letter to him that AFMA expected that the "package of fishing concessions, both State and Commonwealth would be transferred in its entirety and not split apart"[122]. What did the reference to the "package of fishing concessions" mean? It clearly referred to both State and Commonwealth concessions entitling Mr Howard to fish in the "southern shark gillnet fishery". Given that the reference was made in the context of the transfer of the A10 permit, the only reference could be to the TSGL that Mr Howard had acquired on the basis of his Commonwealth licence and the TBFL he had purchased as part of the package from Mr Barling. That he had transferred the TBFL from the Opal Star to the Bronze Wing made it no less part of the original package. Support for this conclusion comes from the basis on which Mr Howard was granted a TSGL i.e. as a holder of both Commonwealth and State permits. Although the OCS was to come later and cannot be taken into account, it would have been clear to an operator in Tasmanian coastal waters that the Tasmanian DPIF, as announced by their Minister, had, between 1991 and 1995, mirrored the changes to permit conditions made by the Commonwealth.

99. For whatever reason, and I make no suggestion that anyone is to be blamed, Mr Howard and his solicitors did not draw AFMA's attention to his TSGL. As a result, he was permitted to keep it and fished on it in 1997. Up to the time that he sold his A10 permit, he had also fished for shark on that. As he agreed when giving evidence, I find that Mr Howard had a catch history as a result of his doing so. When he sold his A10 permit, part of the purchase price, even if unquantified, reflected the value of that catch history. I find on the basis of Ms Sachse's evidence that the catch history that was ultimately verified as a result of Mr Howard's activities amounted to 11,274 kilogrammes of school shark and 17,631 kilogrammes of gummy shark.

100. Mr Howard has not challenged the setting of the TAC. The setting of that TAC was considered by the Tribunal in Re Fischer and Australian Fisheries Management Authority[123]. It found it to be consistent with the legislative objective in ss. 3(1)(b) and (c) of the Act. That is to say, there were sound ecological and economic reasons for limiting the amount of school and gummy shark caught in the SSF. Furthermore, controlled catching enhanced maximising economic efficiency in the exploitation of the SSF's stocks of school shark and gummy shark. That was not upset on appeal[124] and is consistent with authorities such as Bannister Quest Pty Ltd v Australian Fisheries Management Authority[125].

101. Opal Fisheries must have relied on at least part, if not all, of Mr Howard's catch history for the years 1994 to 1997, when it submitted its catch history on the A10 permit it had purchased from him. It received an ITQ as a result. Mr Howard had used that A10 permit in the years from 1994 until he sold it in 1996. Had he not transferred the A10 permit he, and not Opal Star Fisheries, would have received the ITQ allocation. When looked at from the point of view of the effort made in the SSF in catching school shark and gummy shark, regard was had to Mr Howard's effort. That is to say, regard was had to the school shark and gummy shark that he caught with the nets he was permitted to use on his A10 permit. If I were to have regard to his catch history between 1994 and 1996 in considering his ITQ for his SSF permit, I would be allowing his effort to be counted twice; once in setting Opal Star Fisheries' ITQ and once in setting Mr Howard's ITQ. I would be giving credit for it twice when other operators may only count there effort once. I would also be allowing it to be counted twice for Mr Howard when he has already received value for his catch history. That value has not been in the form of ITQ but in the form of part of the purchase price that he received when he sold his A10 permit to Opal Star Fisheries.

102. There is a further reason why it would be inappropriate for Mr Howard's catch history to be taken into account in allocating the ITQ that is a condition of his SSF permit. The TAC has been apportioned amongst all permit holders in each of the SSF, the SETF and the GABTF and each of the six sectors within the SSF[126]. The Commonwealth Gillnet Sector and the Tasmanian Shark Gill Net Sector are two of those six sectors. They are quite distinct sectors. The TAC for the Tasmanian Shark Gill Net Sector represents the proportion that the aggregate catch in that sector represents to the total catch in the whole of the extended SSF during the period from 1 January 1994 to 31 December 1997. To permit an operator in the Tasmanian Shark Gill Net Sector to have regard to shark caught in the Commonwealth Gillnet Sector would give that operator a disproportionate share when compared with the other operators in that Tasmanian Shark Gill Net Sector. It would give Mr Howard an advantage that would not be supported by the effort he has made in that sector of the SSF.

103. I am aware that the quota that he has been allocated is insufficient for Mr Howard to make a livelihood but relativities among fishermen in the SSF would necessarily be distorted if he were allocated an ITQ on the basis of a catch history for which he has already received recompense. Mr Howard submitted that operators in Tasmania's coastal waters, or some of them, were "pretty well laid back" and do not "fish their licences too much" while he worked harder. He himself fished in rough weather and in good because he had to make a living.

104. Certainly, Mr Howard's fishing efforts over the years have been compromised over the years by his wife's illness. As a consequence, he has faced difficulties in managing both his family life and his business. Understandably, he put the health of his wife first. That may have led to his not being able to fish on his TGSL to its full potential but, on the basis of his evidence, I find that Mr Howard was able to undertake other fishing activities that kept him closer to home. Those other activities brought him income but did not add to his catch history of school shark and gummy shark. Consideration was given to Mr Howard's unfortunate circumstances when he was permitted to transfer his A10 permit on compassionate grounds at a time when AFMA did not recognise that a permit could be legitimately transferred. Again, I would be permitting him to use his circumstances twice if I were to allow his personal circumstances to be taken into account in setting his ITQ.

105. On the basis of the reasons I have given, I have concluded that there should be no change to the verified catch history on which his ITQ was based. In view of the conclusions reached by Ryan J in Australian Fisheries Management Authority v Graham, consideration must also be given to any value that Mr Howard's SSF permit may have on the basis that it represents an access to the SSF or a right or entitlement to participate in fishing for school shark in that fishery. I have no evidence as to its value and so can make no finding in that regard and must leave that to AFMA to determine.

1. remit the matter to the respondent to assess whether the applicant's allocation of Individual Transferable Quota appearing as a condition on his Southern Shark Fishery Permit No. 27008 is varied by considerations of the value of that permit; and

I certify that the one hundred and six preceding paragraphs are a true copy of the reasons for the decision herein of

Deputy President S A Forgie,

Signed: ..(sgd. N. Wills).......................................

Nathaniel Wills Associate

Date of Hearing 22 and 23 March 2004

Date of Decision 22 April 2005

For the Applicant self represented

Counsel for the Respondent Ms. D. Mortimer

Solicitor for the Respondent Dibbs Barker Gosling

[1] A headrope is a length of buoyant rope with fishing net attached along its length: SSF permit definition; Documents lodged pursuant to s. 37 of the Administrative Appeals Tribunal Act 1975 ("T documents") at 306

[13] Act s. 4(1) and see also Seas and Submerged Lands Act 1973 ss. 3(2) and (2A) and the Schedule incorporating Articles 55 and 57 of the United Nations Convention on the Law of the Sea. At present, the exclusive economic zone is no more than 200 nautical miles beyond and adjacent to Australia's territorial sea. In general terms, Australia's territorial sea is no more than 12 nautical miles from the low water line: Seas and Submerged Lands Act 1973 s. 3(1) and the Schedule incorporating Articles 3 and 4 of the United Nations Convention on the Law of the Sea.

[14] Act, s. 4(1) as amended with effect from 16 December 1999 by the Fisheries Legislation Amendment Act (No.1) 1999, s. 3 and Schedule 1, items 4 and 5

[15] Act, s. 72 and see also ss. 61 and 71 regarding the formation of and management by a Joint Authority.

[33] The Fisheries Act 1952 was repealed with effect from 3 February 1995 by the Fisheries Legislation (Consequential Amendments) Act 1991, s. 3.

[34] Then known as the Southern Shark Gillnet Fishery.

[35] Announced by the Minister for Primary Industry ("Minister"): T documents at 66-67. Entry into the demersal longline fishery was similarly restricted in January 1994. The outline of the entry criteria for that fishery appear at T documents at 135-148.

[36] SSF88 was based on recommendations in the report entitled Southern Shark Fishery - Report on Future Management prepared by the Southern Shark Fishery Task Force: T documents at 21-82. That task force had been established by the Australian Fisheries Council.

[37] A pro rata adjustment was made for operators who entered the SSF during that five year period.

[39] The transfer policy was later ameliorated to take account of circumstances such as death or serious illness.

[41] Since AFMA's inception in February 1992, SharkMAC has reported directly to it.

[45] e.g. controls over the number of boats and nets permitted in the SSF

[48] Nothing other than a TFBL was required at that time but that was to change: see [25] below.

[50] Later, in July 1997, Mr Howard took the TBFL from the Bronze Wing and put it on "No Boat" after he had sold the Bronze Wing.

[51] Exhibit 2, Attachment F at 1 and see also the Factual Brief regarding the Tasmanian Shark Fishery prepared by the Southern Shark Independent Allocation Advisory Panel: T documents at 287

[56] T documents at 321, The Margaret Pearl is licence no. TW4

[74] 37th meeting of the Standing Committee on Fisheries and Aquaculture

[76] Report of Advice Concerning Apportionment and Allocation in Respect of School Shark and Gummy Shark: T documents at 186-228

[77] The six sectors are the Commonwealth Gillnet Sector, Commonwealth Hook Sector, Tasmanian Shark Gill Net Sector, Tasmanian Shark Hook Sector, Tasmanian Rock Lobster Sector and the South Australian sector of licensed fishers with access to school shark and gummy shark.

[78] T documents at 194-5, 197, 203 and 236-7

[89] In general terms, the coastal waters of a State are those parts of Australia's territorial seas that are within 3 nautical miles of the baseline by reference to which Australia's territorial limits are defined and that are adjacent to that State as well as marine or tidal waters that are on the landward side of that baseline: Act, ss. 4(1) and 5

[91] Fins off, trunk headed and gutted: T documents at 293

[93] Verified Shark Catch History: T documents at 299-300. AFMA also verified a further 180.40 kilogrammes of saw shark but that did not attract ITQs.

[100] [2003] FCA 231; (2003) 127 FCR 436 on appeal from Re Fischer and Australian Fisheries Management Authority [2002] AATA 857; (2002) 71 ALD 665

[102] Re Drake and Minister for Immigration and Ethnic Affairs (No. 2) [1979] AATA 179; (1979) 2 ALD 634 at 645 per Brennan J, President

Howard and Australian Fisheries Management Authority [2005] AATA 360 (22 April 2005)

At a glance

Court

Decision date

Source

Judgment (220 paragraphs)

Howard and Australian Fisheries Management Authority [2005] AATA 360 (22 April 2005)

Legislation Cited (5)

Cases Cited (8)