Mohamed trading as Billan Family Day Care v Secretary, Department of Education, Skills & Employment

Federal Court of Australia|2020-06-25|Before: O'Bryan J

Upon the applicant through its legal representative providing the usual undertaking as to damages, the provider approval cancellation decision made by the respondent in respect of the applicant on 7 May 2020 (the cancellation decision) be stayed until the final determination of the applicant's originating application for judicial review of the cancellation decision or further order.
The applicant file and serve any further material upon which he proposes to rely at hearing in affidavit form, and written submissions of no more than 10 pages, by 13 July 2020.
The respondent file and serve any material upon which the respondent proposes to rely at hearing in affidavit form, and written submissions in response of no more than 10 pages, by 27 July 2020.
The applicant file and serve any submissions in reply of no more than 5 pages by 3 August 2020.
The parties file a joint electronic bundle of authorities and legislation in text-recognised PDF format which contains electronic bookmarks to each document in the bundle by 2 business days before the hearing of the originating application.
The originating application be listed on a date to be fixed on or after 3 August 2020 on an estimate of no more than one day.
The interlocutory application filed in this proceeding on 4 June 2020 be otherwise dismissed.
The applicant pay the costs of the respondent of the interlocutory hearing on 25 June 2020.
Costs otherwise be reserved. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background 4 The evidence filed on this interlocutory application shows that the applicant conducts a family day care service operating in New South Wales and Victoria under the name Billan Family Day Care. Billan Family Day Care is approved to engage or register 125 family day care educators in Victoria and 15 educators in New South Wales. Currently it registers approximately 51 educators in Victoria and 7 in New South Wales. Educators provide care in their own home to children who are usually from their neighbourhood or surrounding area and often from a similar cultural background to that of the educator. Billan Family Day Care has 166 families that rely on it for family day care and provides family day care services to approximately 362 children. The families that use the service come from backgrounds of varying national heritage, including Australia, Pakistan, India, Sudan, Somalia, Iraq and Afghanistan. Most of the families come from lower socio-economic backgrounds. Many of the parents work shift-work and perform essential services, including emergency, health care services, aged care services, night-time cleaning, factory work and Uber driving. Many parents also attend English language classes during the day or at night-time to improve their education and job prospects. A number of parents are from single parent families. 5 Billan Family Day Care has been approved by the respondent, under s 195 of the Administration Act, to operate a Child Care Benefit Family Day Care Service since 1 October 2009. The operation of the relevant part of the Administration Act was summarised by Thawley J in Galaxy Day Care Pty Ltd v Department of Education and Training [2018] FCA 1549 (Galaxy) at [3]-[5]: …The Act contains a number of provisions of an administrative, procedural and technical nature that apply in relation to the provision and administration of the family tax benefit and child care subsidy. The scheme contemplates, where it applies, that a person whose child is in care may make a claim for a benefit, but the payment of the benefit will be made to the child care service provider. A child care service provider must be approved under the Act in order for the subsidy to be paid to it and for the person whose child is in care to make a claim in respect of that service. Part 8, Div 1 of the Act provides for provider approval and contains a series of rules governing eligibility. Part 8, Div 2, which contains s 195H, includes various conditions for continued approval. The decision in respect of which the originating application seeks review was made under s 195H(1)(b), which provides as follows: (1) If the Secretary is satisfied that an approved provider has not complied, or is not complying, with a condition for continued approval of the provider, the Secretary may do one or more of the following: … (b) cancel the provider's approval; … Section 109A(1B)(a) allows for a provider to apply to the Secretary for internal review of a decision made under Pt 8. … 6 The effect of holding a provider approval under s 195 of the Administration Act is that individuals whose children are being provided with care at Billan Family Day Care receive child care subsidies, which are paid to Billan Family Day Care, with the result that the individuals do not have to pay the full hourly rates charged by Billan Family Day Care's educators. 7 On 7 May 2020, the respondent issued the applicant with a cancellation notice under s 195H(1)(b) of the Administration Act which takes effect from 28 June 2020. From the day the provider cancellation takes effect, the applicant will no longer be approved under s 195 of the Administration Act and individuals whose children are being provided with care at Billan Family Day Care will no longer be eligible for the applicable child care subsidies. 8 On 12 May 2020, the applicant requested the respondent to undertake an internal review of the cancellation decision under s 109A of the Administration Act. The applicant filed its submissions in support of its application on 29 May 2020. The internal review application does not prevent the cancellation decision from taking effect on 28 June 2020.

The issue in dispute 9 It was apparent at the case management hearing on 17 June 2020 that the issue in dispute between the parties on the interlocutory application was the power of the Court, under s 15 of the ADJR Act, to order a stay of the cancellation decision pending the completion of the internal review of that decision being conducted by the respondent. There is no dispute concerning the power of the Court to order a stay of the cancellation decision under s 15 of the ADJR Act pending the determination by the Court of the applicant's originating application, and the respondent had indicated its willingness to consent to such an order. 10 Despite the issue in dispute having been identified at the case management hearing, the written submissions filed by the applicant barely referred to that issue. Instead, the written submissions focussed on the usual criteria for the grant of interlocutory injunctions as stated in Australian Broadcasting Corporation v O'Neill (2006) 227 CLR 57 at [65], whether there is a prima facie case for final relief and whether the balance of convenience favours the grant of interim relief (here, the stay of the cancellation decision). 11 At the hearing of the interlocutory application, the applicant argued that he was not seeking a stay of the cancellation decision pending the completion of the internal review by the respondent; rather, the applicant was seeking a stay for a fixed period of time being 6 months. The applicant submitted that the Court has power to grant a stay for a fixed period of time and the balance of convenience favoured a stay for that period because, if the internal review is completed favourably to the applicant, it would avoid the need for the originating application to be determined by the Court. 12 In my view, the applicant's argument is self-contradictory. While the applicant argued that he was not seeking a stay pending the completion of the internal review, the length of the stay was based on the expected timing of the internal review and the reason for a stay of that length was the asserted benefit of allowing the internal review to be completed. Contrary to the applicant's argument, the stay being sought by the applicant is for the purpose of allowing the internal review to be completed. 13 Consistently with the respondent's position at the case management hearing, the written submissions filed by the respondent did not contest the existence of a prima facie case nor the balance of convenience, and the respondent continued to indicate its consent to an order staying the cancellation decision pending the determination by the Court of the applicant's originating application. The respondent submitted that s 15 of the ADJR Act does not empower the Court to stay the cancellation decision pending the internal review, as the internal review is not a legal or equitable right which is being pursued or protected by the originating application; it is collateral to the legal remedy being pursued by the applicant through the originating application. I accept that submission. 14 Section 15 of the ADJR Act provides as follows: (1) The making of an application to the Federal Court under section 5 in relation to a decision does not affect the operation of the decision or prevent the taking of action to implement the decision but: (a) the Court or a Judge may, by order, on such conditions (if any) as it or he or she thinks fit, suspend the operation of the decision; and (b) the Court or a Judge may order, on such conditions (if any) as it or he or she thinks fit, a stay of all or any proceedings under the decision. 15 While s 15 of the ADJR Act is stated in general terms, the power given to the Court must be exercised for the purpose for which it is conferred. It is implicit in both the text and context of s 15 that the power to suspend or stay the operation of an administrative decision is a power that is in aid of the power of the Court to review the administrative decision under s 5 of the ADJR Act. It is not a free-standing power, but a power that arises after an application for review has been made to the Court and is for the purpose of the conduct of the review. 16 That construction of s 15 is consistent with the principles governing the grant of interlocutory injunctions in equity and under other statutory provisions. In relation to the grant of interlocutory injunctions in equity, the purpose of the injunction is to preserve the status quo until the hearing of the main action: Meagher, Gummow and Lehane's Equity Doctrines and Remedies at [21-340]. The majority in Cardile & Ors v LED Builders Pty Ltd (1999) 198 CLR 380 (at [31]) affirmed the principle that: … the power stated in Judicature legislation - that the court may grant an injunction in all cases in which it appears to the court to be just and convenient to do so - does not confer an unlimited power to grant injunctive relief. Regard must still be had to the existence of a legal or equitable right which the injunction protects against invasion or threatened invasion, or other unconscientious conduct or exercise of legal or equitable rights. The situation thus confirmed by these authorities reflects the point made by Ashburner that "the power of the court to grant an injunction is limited by the nature of the act which it is sought to restrain". 17 In respect of the power of the Federal Court to grant interlocutory injunctions under s 23 of the Federal Court of Australia Act 1976 (Cth), Deane J observed in Jackson v Sterling Industries Ltd (1987) 162 CLR 612 (at 622) that, though the power in s 23 is wide, it is nevertheless restricted to the making of the kinds of order, whether final or interlocutory, which are capable of properly being seen as appropriate to be made by the Federal Court in the exercise of its jurisdiction. The majority in Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia (No 3) (1998) 195 CLR 1 said in respect of the power (at [35]): The general principle which informs the exercise of the power to grant interlocutory relief is that the court may make such orders, at least against the parties to the proceeding against whom final relief might be granted, as are needed to ensure the effective exercise of the jurisdiction invoked. 18 The applicant was unable to refer me to any decision of this Court in which an order had been made under s 15 of the ADJR Act staying an administrative decision for a period that was unrelated to the determination of the primary application made under the ADJR Act. However, the applicant argued that a number of decisions of this Court have concluded that the principles on which the Court may order a stay under s 15 of the ADJR Act are not confined to the principles that support the grant of an interlocutory injunction. In that respect, the applicant relied on Perkins v Cuthill (1981) 52 FLR 236 (Perkins) at 237-238 per Keely J; Snow v Deputy Commissioner of Taxation (1987) 14 FCR 119 (Snow) at 129 per French J; Galaxy at [19] per Thawley J; and Azaria Family Day Care Pty Ltd v Secretary, Department of Education and Training [2018] FCA 1640 (Azaria) at [6]-[8] per Wheelahan J. 19 In my view, none of the authorities referred to by the applicant support its argument. None concerned the question whether a stay can be granted under s 15 in aid of a process of administrative review that is external and collateral to the review sought from the Court under the ADJR Act. Rather, each of the authorities concerned the appropriate principles to guide the exercise of the Court's discretion to grant a stay pending the determination of the application brought under s 5 of the ADJR Act. In that respect, the authorities considered whether those principles ought be based on those that apply to the grant of an interlocutory injunction, namely the existence of a prima facie case and the balance of convenience, or whether another or higher standard, such as exceptional circumstances, needs to be shown. The authorities support the conclusion that it is not necessary to show exceptional circumstances to invoke the Court's discretionary power under s 15, but an applicant would usually need to satisfy the Court that the applicant has a point of substance to argue which, if successful, would result in judgment in his favour, a test which in practical terms is similar to the test for an interlocutory injunction: see Perkins at 238 per Keely J and French J in Snow at 131. In some cases, it may not be sufficient for the applicant to satisfy the test for the grant of interlocutory injunctions: Snow at 129 and 131. 20 The form of orders and reasons for decision in Galaxy and Azaria do not support the applicant's argument. In Galaxy, in a similar context to the present, Thawley J granted a stay under s 15 of the ADJR Act for a fixed period of time, and also ordered that if the respondent made a decision on internal review before that date, the applicant was required to have the matter relisted before the Court for consideration as to whether the stay should be vacated or extended. His Honour explained in his reasons that, although the stay was being granted in aid of the application for relief under the ADJR Act, the outcome of the internal review being conducted by the respondent might alter the assessment of the applicant's prospects of success on its application and/or the balance of convenience (at [34]). In those circumstances, his Honour considered that it was appropriate to have the matter relisted after the completion of the internal review for reconsideration of the stay (at [35]). In my view, it is clear from his Honour's reasons that the stay was not granted in aid of the process of internal review. A similar order was made by Wheelahan J in Azaria on the same basis. 21 For those reasons, I reject the applicant's interlocutory application in so far as it seeks a stay of the cancellation decision for a period of time to enable the internal review of the decision to be completed by the respondent.

Undertaking as to damages 22 The applicant proffered an undertaking as to damages in support of its application for a stay. In my view, an undertaking is required in the circumstances of this case. 23 Section 15 of the ADJR Act provides that the Court may suspend or stay an administrative decision the subject of an application for review under s 5 on such conditions as the Court thinks fit. 24 In Century Metals and Mining NL v Yeomans (1988) 85 ALR 54, French J considered the principles that should guide the Court in determining whether a stay under s 15 of the ADJR Act should be conditioned on the giving of an undertaking as to damages or a similar order. After observing that, in respect of interlocutory injunctions granted in equity and under other statutory provisions, it is usual for the grant to be conditioned upon an undertaking as to damages (referring to Air Express Ltd v Ansett Transport Industries (Operations) Pty Ltd (1979) 146 CLR 249 at 260 and Meagher, Gummow and Lehane, Equity Doctrines and Remedies (see at [21-410])), his Honour said (at 58-59): The provisions of s 15 of course arise in a special statutory context whereby the subject is afforded an opportunity to seek review of official decisions adverse to it. There is in that statutory setting, a particular public interest in fair and lawful official decision-making. That, of course, is not a factor which concludes the debate against the requirement of an undertaking. There are many cases brought between private litigants under the Trade Practices Act 1974 (Cth) for example, which have public interest consequences. And so much has been recognised in such cases where interlocutory relief is granted notwithstanding delay: World Series Cricket Pty Ltd v Parish (1977) 16 ALR 181 at 186 and 203. Dealing with the statutory discretion to grant interlocutory injunctive relief under s 80 of the Trade Practices Act, Brennan J said at 199 in that case: In exercising its statutory discretion, however, the court refers to equitable principles if only to ensure that factors which are relevant to the exercise of the discretion are not omitted from consideration. Although the principles of equity do not mark the limits of relevancy or solely determine the exercise of the statutory discretion, they are relevant norms which may provide assistance in larger or smaller measure according to the closeness of the equitable analogue to the case in hand. When an applicant, who might have invoked the auxiliary jurisdiction of equity to protect his property rights, chooses to bring proceedings under the Act and alleges, for example a contravention of s 53(c) and applies for an injunction under s 80 merely in order to protect those rights, his application may be determined by reference to the same principles as those which would have been applied by a court of equity. But the equitable analogy is inadequate when the applicant neither owns property nor is charged with a duty to enforce compliance with the prohibition. 25 Similarly, in Botany Bay City Council v Minister of State for Transport & Regional Development (1996) 90 LGERA 81, Sheppard J said in respect of an undertaking as to damages relating to an application under the ADJR Act (at 86): Of course, in the area of administrative law considerations whether a party seeking interlocutory relief should be required to give an undertaking as to damages are not the same necessarily as apply where a party in what I may term private litigation sues and obtains an interlocutory injunction in order to preserve the status quo pending the Court determining the matter finally. In such cases an undertaking as to damages is usual. In the administrative law area there is no hard and fast rule and it may be that, if the [applicants] were entitled to interlocutory relief, it would not be appropriate to require such an undertaking. 26 In the present case, the applicant seeks a stay of the respondent's cancellation decision pending a review of the decision. The effect of the stay is that the applicant will continue to hold an approval from the respondent, under s 195 of the Administration Act, to operate a Child Care Benefit Family Day Care Service. As such, individuals whose children are being provided with care at Billan Family Day Care will continue to be eligible for the applicable child care subsidies which will be paid to the applicant. 27 In my view, it is appropriate to grant a stay of the cancellation decision on the condition that the applicant gives the usual undertaking as to damages. If the applicant is unsuccessful in this proceeding, it will have been paid child care subsidies by the Commonwealth which, but for the stay, it would not have been entitled to receive. While the subsidies are due to the individuals whose children are provided with care at Billan Family Day Care, the subsidies are paid to the applicant and the applicant charges its clients lower hourly rates for its services. In my view it is appropriate, as a condition of the stay, that if the applicant is ultimately unsuccessful on its application for review under the ADJR Act, the applicant undertake to repay to the respondent the child care subsidies received in the period from 28 June 2020. I note that such undertakings were given in the same context in each of Galaxy and Azaria.

Conclusion 28 In conclusion, I will order that the cancellation decision made by the respondent in respect of the applicant on 7 May 2020 be stayed until the final determination of the applicant's originating application for judicial review of the cancellation decision, and otherwise dismiss the applicant's interlocutory application. I will also make orders timetabling the steps to hear the applicant's originating application. 29 In relation to costs, I consider that the applicant should pay the respondent's costs of and incidental to the hearing today (being the preparation of written submissions and the appearance today), but otherwise costs should be reserved. The reason for that order is that the orders that I will make today are substantively the same as proposed by the respondent at the case management hearing on 17 June 2020. The applicant has failed to obtain the wider order that it sought in its interlocutory application. The costs of today would have been avoided if the applicant had accepted the orders proposed by the respondent. I certify that the preceding twenty-nine (29) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice O'Bryan.

Trade Practices Act 1974(Cth)

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