Making a decision about existing legal rights as a step leading to a decision
92 In any event, even if AFCA had reached some conclusions as to the adequacy of the notice under CA s 1017B(4) or as to the existence of a contravention of CA s 1017B(1), as a step leading to its ultimate determination, and therefore made a decision about the legal rights of QSuper and Dr Lam inter se, this would not have amounted to an exercise of judicial power, as the reasons which follow establish.
93 The parties made extensive submissions as to the legitimacy of AFCA deciding or reaching conclusions as to the legal rights of parties with respect to CA s 1017B(4) as a step in the process of it making its ultimate determination. Initially, Mr Sullivan QC submitted that it would be an impermissible exercise of judicial power if AFCA was to make a determination of legal rights as a step along the way to making a determination under CA s 1055. Subsequently, however, he conceded that reaching conclusions or making decisions about legal rights as steps taken in the course of making an administrative decision, do not involve the exercise of judicial power.
94 That concession was rightly made and accords with, inter alia, observations made by Hayne J in Attorney-General (Cth) v Alinta Limited [2008] HCA 2; 233 CLR 542 (Alinta) at 565 [53]. In that case Alinta claimed that the Takeovers Panel's exercise of certain powers given to it under the CA were invalid as being the exercise of judicial power. Relevantly, under CA s 657A(2)(b) the Panel might make a declaration of "unacceptable circumstances" where the identified circumstances "constitute, or give rise to, a contravention of a provision of [Chapter 6] or of Chapter 6A, 6B or 6C". The issue before the High Court was the constitutional validity of s 657A(2)(b). The Court held the section did not invalidly confer judicial power. The power exercised by the Panel was based on policy, not law, and created new rights and obligations which were only enforceable by a court on the independent exercise of judicial power. Hayne J (with whom Gleeson CJ and Gummow J agreed) added that the fact that an order of the Panel was open to challenge in judicial review proceedings and by collateral attack in other proceedings, further pointed away from the conclusion that it exercised judicial power. Relevantly for the present purposes, it was observed that the Panel's determination was not merely about the rights of the parties under Chapters 6, 6A, 6B or 6C and whether a contravention had occurred. The issues which arose on any determination were much wider and extended to commercial questions that emerged in relation to takeover bids. As Hayne J said at 576 [90]:
It follows that to describe the Panel as quelling a controversy about contravention is inaccurate. Even if it were right to describe the Panel's task as quelling a controversy, the controversy or dispute with which the Panel deals, when s 657A(2)(b) is engaged, is wider than a controversy or dispute about contravention of the Corporations Act.
95 In other words, the mere conclusion made by the Panel as to whether a contravention of Chapter 6 occurred, did not quell any controversy between the parties on that issue and nor was that the purpose or object of the Panel's exercise of power. For that reason, in part, there was no exercise of judicial power. To similar effect are the observations of Crennan and Kiefel JJ at 595 [161]:
…The adjudication of a dispute is itself, however, neither conclusive, nor even a strong indicator, of a judicial function. It is commonplace in administrative law. A non-judicial function, such as arbitration, does not cease to be so because the decision-maker forms an opinion as to existing legal rights and obligations. A controversy of the kind dealt with by the courts requires more than an adjudication of some dispute. A controversy has as its subject matter the existence of a legal right or obligation.
(footnotes omitted)
96 The above propositions were, at least for the purposes of the present case, succinctly stated in Australian Communications and Media Authority v Today FM (Sydney) Pty Ltd [2015] HCA 7; 255 CLR 352 (Today FM). In that case a commercial radio broadcasting licensee, Today FM, had recorded and broadcasted a telephone call between two presenters of a program and a member of staff at a hospital where the Duchess of Cambridge was an inpatient. In the course of the conversation the broadcasters obtained information under false pretences and published the same by airing the recording. It was a condition of Today FM's licence that it would not use the radio broadcasting service in the commission of an offence. A breach of the licence condition could be prosecuted as an offence, made the subject of civil penalty proceedings or found administrative action including the suspension or cancellation of the licence. The authority initiated a preliminary investigation and concluded that the broadcaster had committed an offence under New South Wales laws which prohibited a person from publishing a private conversation that had come to their attention by the use of a listening device. Today FM sought injunctive relief against the authority to restrain it from taking any action based upon its conclusions made on the preliminary inquiry. Prior to the hearing of an appeal from an initial refusal to grant the injunction, the authority handed to Today FM a final report which contained the same findings as appeared in the preliminary report. Before the High Court, Today FM submitted that the provisions authorising the authority to make determinations as to whether the licensee had committed an offence purported to impermissibly confer the judicial power of the Commonwealth on it.
97 In his reasons for judgment, Gageler J held that the authority's determination, made for the purpose of taking disciplinary proceedings, that the licensee had used the broadcasting service to commit an offence, did not in involve an impermissible exercise of judicial power. At 380-381 [64] his Honour said:
This Court has repeatedly held that a power of inquiry and determination takes its legal character from the purpose for which it is undertaken, and that a power of inquiry and determination undertaken for a non-curial purpose (be it arbitral, administrative, executive or legislative) can encompass formation and expression of an opinion about an existing legal right or obligation. No distinction has been drawn in that respect between an opinion about an existing legal obligation sounding only in civil liability and an opinion about an existing legal obligation sounding only, or also, in criminal liability. It has been held, for example, that a commission of inquiry established under Commonwealth legislation can be authorised to inquire into and report on whether or not a person has committed an offence, for the purpose of informing the exercise or performance of a power or function of the Commonwealth Parliament or of the Commonwealth Executive.
(footnotes omitted)
98 The plurality (French CJ, Hayne, Kiefel, Bell and Keane JJ) expressed a similar view at 371-372 [33]:
More generally, and contrary to the "normal expectation" stated by the Full Court, it is not offensive to principle that an administrative body is empowered to determine whether a person has engaged in conduct that constitutes a criminal offence as a step in the decision to take disciplinary or other action. The decisions of this Court in Attorney-General (Cth) v Alinta Ltd and Albarran v Companies Auditors and Liquidators Disciplinary Board accept so much. There is no reason to suppose that a Commonwealth public housing authority might lack the capacity to terminate a lease on the ground of the tenant's use of the premises for an unlawful purpose notwithstanding that the tenant has not been convicted of an offence arising out of that unlawful use.
(footnotes omitted)
99 The principle referred to in the above authorities substantially undermined QSuper's submissions that AFCA impermissibly exercised judicial power by determining that CA s 1017B(1) had been breached and relying upon that as part of the process of determining QSuper's refusal to refund any part of Dr Lam's premiums was unfair and unreasonable. If contrary to the previous conclusions, AFCA had taken that course, the authorities referred to establish that no impermissible exercise of judicial power would have occurred.
100 It was submitted on behalf of the Attorney-General by Mr del Villar QC, even if AFCA had solely relied upon its conclusion that QSuper's Notice contravened CA s 1017B(1) in making its determination, no exercise of judicial power would have occurred. That submission should be accepted and it follows from the decision in Alinta. There, s 657A(2)(b) authorised the Takeovers Panel to make the finding of unacceptable circumstances based solely upon its conclusion that the CA had been relevantly contravened. In upholding the section's validity, the High Court's decision necessitates the conclusion that it is not an impermissible exercise of judicial power for an administrative body to make a broader determination founded only upon an antecedent conclusion as to existing legal rights.
101 Mr Sullivan QC sought to distinguish Alinta on the basis that s 657A(2)(b) expressly authorised the Panel to act in that way. However, that point of difference has no relevance in the present circumstances. If it were impermissible for a body other than a Chapter III court to determine rights as between parties as the foundation of a broader decision, it does not matter whether such a power is expressly conferred or not. If it has been expressly conferred, the conferral would be invalid as being contrary to the prohibition in s 75(v) of the Constitution. In this respect the decision in Alinta is not distinguishable.
102 It follows that even if AFCA had determined that QSuper's refusal to refund money to Dr Lam was unreasonable only because the Notice did not comply with CA s 1017B(4), no impermissible exercise of judicial power would have occurred. The power under CA s 1055 is to decide if, inter alia, a decision is, in its operation in relation to a member, unfair or unreasonable. If in reaching a conclusion on that broad inquiry an assessment is made about the legal rights of the parties, no exercise of judicial power will have occurred. The broader question being resolved is not about legal rights or obligations, and forming a conclusion as to legal rights as a step along the way to a determination does not invalidate the exercise of power.