R v Anderson; Ex parte Ipec-Air Pty Ltd

R v Anderson; Ex parte Ipec-Air Pty Ltd - [1965] HCA 27 - HCA 1965 case summary — Zoe

[4]

It must be kept steadily in mind that under reg. 199 (2) the Director-General was under a positive duty to issue the charter licence unless the applicant had not established that he was capable of complying during the currency of the licence with certain provisions relating to the safety of the operations. The provisions referred to were those of the Regulations, or of any direction or order given or made under the Regulations. Only by the imposition of that positive duty were the Regulations as to charter licences saved from invalidity under s. 92 of the Constitution. The evidence shows that the Director-General and his Department investigated thoroughly every aspect of the prosecutor's applications and that he was satisfied on every point; but that in obedience to instructions from the Government he was not prepared to give permission for the importation of the necessary aircraft. He did not rest his refusal of the charter licence on any consideration related to the safety of the operations. He did not specify any provision of the Regulations, or indicate any existing or anticipated future provision of any direction or order under the Regulations, relating to the safety of the operations, with which he was not satisfied that the prosecutor would be capable of complying if DC. 4 freight aircraft should be or become available to it. He was of course well aware that any such aircraft, and their use in the manner appropriate to the proposed services, would always be covered by current certificates of type approval under Div. 2 of Pt IV of the Regulations and certificates of airworthiness under Div. 3 of that Part, that they would in all respects comply with the Regulations, that maintenance etc. would always have to be carried out by persons approved under Div. 6, and that the crews would be licensed under Pt V. Moreover, the inference is, I think, inescapable that he was satisfied of the suitability in all respects of Douglas DC. 4 freight aircraft. The evidence, and particularly the Director-General's own statements, make it clear that his refusal of the charter licence had nothing whatever to do with any question of safety, and that in truth the prosecutor has established to the satisfaction of the Director-General that it is capable of complying with any and all provisions relating to the safety of the proposed operations. I read the Director-General's letter refusing the charter licence as acknowledging, even if unintentionally, that it was in spite of, and not because of, the concluding words of reg. 199 (2) that the charter licence was being refused. I think the truth of the matter should be faced: the refusal of the licence was based upon nothing whatever but a policy against allowing anyone to participate in the relevant form of inter-State trade other than those already engaged in it. However wise and well-grounded in reason that policy may be, if the Regulations on their true construction authorize a refusal so based I should find great difficulty in avoiding the conclusion that reg. 197, in so far as it requires a charter licence for charter operations in inter-State air navigation, is invalid as being in conflict with s. 92 of the Constitution. In my opinion, however, such a refusal is contrary to the direct command of reg. 199 (2).

[7]

Neither in the Regulations nor elsewhere is there to be found any express provision as to the principles which the Director-General is to observe, or the matters which he is to take into consideration, when deciding whether to grant or to refuse a permission to import aircraft. But from the fact that he is designated by the title of his office the intention appears, as it seems to me, that the power of lifting the general prohibition is not given him for his own benefit or otherwise than for purposes relevant to his office. It is a general principle of law, applied many times in this Court and not questioned by anyone in the present case, that a discretion allowed by statute to the holder of an office is intended to be exercised according to the rules of reason and justice, not according to private opinion; according to law, and not humour, and within those limits within which an honest man, competent to discharge the duties of his office, ought to confine himself: Sharp v. Wakefield [1] . The courts, while claiming no authority in themselves to dictate the decision that ought to be made in the exercise of such a discretion in a given case, are yet in duty bound to declare invalid a purported exercise of the discretion where the proper limits have not been observed. Even then a court does not direct that the discretion be exercised in a particular manner not expressly required by law, but confines itself to commanding the officer by writ of mandamus to perform his duty by exercising the discretion according to law: Cuming Campbell Investments Pty. Ltd. v. Collector of Imposts [2] . A case for the granting of mandamus on this principle exists where the officer has taken into account matters "absolutely apart from the matters which by law ought to be taken into consideration": Reg. v. Cotham [3] ; Randall v. Northcote Corporation [4] , or has acted for a purpose other than that for which the discretion exists: Water Conservation and Irrigation Commission v. Browning [5] , or has accepted another's direction as to the way in which the discretion should be exercised: R. v. Stepney Corporation [6] ; Simms Motor Units Ltd. v. Minister of Labour and National Service [7] , cf. Evans v. Donaldson [8] .

[28]

In these circumstances, it seems that our enquiry in the matter must commence with consideration of the effect of reg. 4 (2) of the Customs (Prohibited Imports) Regulations and the character of the function committed to the Director-General by Item 1 of the Third Schedule to those Regulations. In terms reg. 4 (2) provides that the importation into Australia of the goods specified in the second column of the Third Schedule to those Regulations is prohibited unless the conditions, restrictions or requirements specified in the third column of that Schedule opposite to the description of the goods are complied with. Item 1 of the Third Schedule is "Aircraft, airframes and aircraft engines" and the condition specified is expressed in the following words: "The importer shall produce to the Collector the permission in writing of the Director-General of Civil Aviation to import the goods". A regulation in such a form has long been accepted as a permissible exercise of the statutory power conferred by s. 52 of the Customs Act 1901-1963 (Radio Corporation Pty. Ltd. v. The Commonwealth [1] ; Poole v. Wah Min Chan [2] ; and Reg. v. McLennan; Ex parte Carr [3] ). However it should be made clear at once that it is not contended that reg. 4 (2) operating in relation to Item 1 of the Third Schedule infringes s. 92 of the Constitution. It is true that the prohibition thereby erected may have a very substantial consequence in relation to inter-State trade, in common, of course, with other forms of trade both intra-State and overseas, but it is beyond doubt that it does not have any legal operation in relation to any activity which itself forms part of the concept of trade, commerce and intercourse among the States (Wragg v. State of New South Wales [4] ; and Grannall v. Marrickville Margarine Pty. Ltd. [5] ). Nor does it operate "in reference to or in consequence of any matter or thing itself forming part of trade, commerce or intercourse among the States" (per Dixon C.J. in Wragg's Case [6] ). Again it is not possible to impugn the regulation by an investigation of the reasons for its enactment or the motives which called it forth. As was said in Grannall's Case [7] : "It is said that, because the purpose, motive or object with which the present legislation was passed is or may be that margarine shall not be sold to consumers who otherwise might buy butter and because such consumers might buy in inter-State trade or from or through wholesalers or retailers who buy margarine in inter-State trade: it necessarily follows that there is a direct interference with inter-State trade. This involves a confusion between the operation of the law and motives of the legislature. If the State legislature enacts what is prima facie within its power, why should it matter that the legislators advert to a particular consequence and desire it to occur? Does it matter that but for such advertence or desire the legislation would not be passed? If not, what difference does it make if the further inference is warranted that it was only in order to achieve the fulfilment of this desire that the statute was passed? Surely the answer to all three of these successive questions is, no. Nor can it matter whether the purpose or motive is inferred from circumstance or from the statute or, indeed, is stated therein in terms" [1] . At an earlier stage the Judicial Committee speaking of misconceptions which might arise from the use of expressions appearing in earlier cases involving s. 92 said: "in whatever sense the word "object" or "intention" may be used in reference to a Minister exercising a statutory power, in relation to an Act of Parliament it can be ascertained in one way only, which can best be stated in the words of Lord Watson in Salomon v. Salomon & Co. [2] : "In a Court of law or equity, what the legislature intended to be done or not to be done can only be legitimately ascertained from that which it has chosen to enact, either in express words or by reasonable and necessary implication". The same idea is felicitously expressed in an opinion of the English law officers Sir Roundell Palmer and Sir Robert Collier cited by Isaacs J. in James v. Cowan [3] : "It must be presumed that a legislative body intends that which is the necessary effect of its enactments; the object, the purpose, and the intention of the enactment, is the same". The same learned Judge adds: "By the "necessary effect", it needs scarcely be said, those learned jurists meant the necessary legal effect, not the ulterior effect economically or socially"." (The Commonwealth v. Bank of N.S.W. [4] ).

[31]

Accepting the regulation as a valid legislative provision the initial question which arises is concerned with the character of the function which by virtue of the language of the condition specified in the Third Schedule must be taken to have been entrusted to the Director-General. In particular, the question is, does the language in which the condition is expressed create a duty the performance of which may be enforced by mandamus? No right, conditional or otherwise, to the Director-General's written permission is expressly given by the regulations and the question of the existence of a duty, and a corresponding legal right, capable of enforcement by mandamus, is left to be resolved as a matter of implication. Whether or not any implication favourable to the prosecutor should be made must, of course, be considered in the light of the fact that reg. 4 (2) and the Third Schedule is found in subordinate legislation which places no limits upon the considerations which are to guide the Director-General in the performance of the function entrusted to him and which is of a type which gives no clue to any intended limitations. It is legislation promulgated under the Customs Act and is not concerned with any particular subject-matter capable of revealing the scope and object of the function. It may, of course, be that some clue as to the appropriate considerations may be found in the fact that the Director-General is the permanent head of a department of the Commonwealth established for the purpose of exercising a large measure of control in relation to civil aviation of all kinds within the Commonwealth - whether it be inter-State, intra-State, or overseas - and that the function is committed to him in that capacity. But whatever clue this circumstance may afford is vague and indeterminate and can indicate only that he is invested with a discretion which is to be exercised in accordance with his own views as to what will best serve the interests of civil aviation within the Commonwealth. It should also be borne in mind that his function is not a function to prohibit; his authority extends only to the relaxation of a prohibition erected by the Regulations and which, itself, is not in question. The situation is, we think, not unlike that which arose for consideration in Metropolitan Meat Industry Board v. Finlayson [1] where this Court was concerned to enquire whether mandamus would lie to compel the performance of a duty said to arise by virtue of the provisions of s. 19 of the Meat Industry Act, 1915 N.S.W.. That section was in the following terms: "After this Act comes into force - (1) No person shall, except with the consent of and under the conditions prescribed by the" Metropolitan Meat Industry "Board, within the metropolitan abattoir area, slaughter any cattle or dress any carcase for human consumption, except at a public abattoir". Griffith C.J. (with whom Barton J. agreed) was of the opinion that this section did not create any right enforceable by mandamus where consent had been refused for undisclosed reasons. He said: "I asked in vain during the argument for some indication of the matters to which the Board were required to direct their minds in considering such an application, but received no answer except that the Act contemplated that private slaughtering establishments should continue to be carried on as before, and that consent should therefore always be given unless some special reason should be shown for refusing it. It was therefore, it was said, the duty of the Board to indicate to the applicant the reasons which they thought to exist. The answer to this argument is that the Act expressly negatives it. It says that what has hitherto been conditionally lawful shall in future be unlawful except on one condition. In my opinion the discretion of the Board is unfettered. If they think, for instance, that it is in the public interest to confine all slaughtering to the Government abattoirs I do not think that any Court can review their opinion" [1] . Isaacs and Rich JJ. were of the same opinion and observed that: "The only duty the Board has is to receive and consider any application for consent, to honestly deal with it, and to give or refuse its consent as it thinks the public interest in the performance of its mandate in s. 13 requires. The main and overriding consideration is that mandate of s. 13; if consistently with its own view of discharging that great function it thinks, for whatever reasons commend themselves to the Board, that the public welfare will be better served by granting or by refusing its consent, it should act accordingly. No Court can prescribe any narrower or stricter limits of duty" [2] . In our view, much the same observations may be made concerning reg. 4 (2) and the language of the relevant condition set out in the Third Schedule. Whether permission is to be given or not is a matter left to the discretion of the Director-General. His discretion, no doubt, is intended to be exercised upon broad considerations relating to civil aviation in the Commonwealth but this circumstance does not support any implication that there is reposed in him any public duty, or any legal right created - other than a right to have an application for permission honestly considered - which is capable of enforcement by mandamus.

[33]

Nevertheless, the prosecutor maintains that if the Director-General's permission was refused in order to prevent the prosecutor from engaging in inter-State aerial transport operations mandamus will go to compel reconsideration of its application. This contention is based upon the proposition that such a ground of refusal would be obnoxious to the provisions of s. 92. The argument of the prosecutor failed to make clear how this proposition can be supported or, for that matter, how it can be asserted if there exists no legal right in it capable of enforcement by mandamus. But however this may be two particular answers may be made to the contention. The first is that in such a case the inability of the applicant to initiate an inter-State aerial transport service is neither produced by nor the result of the Director-General's refusal. Its inability exists because of the provisions of reg. 4 (2) and the consequential impediment which that regulation creates in the way of a person proposing to conduct an inter-State aerial service is neither intensified nor altered in character by the Director-General's refusal. Before the refusal a person in the position of the prosecutor could not equip himself to carry on the proposed service and as a consequence could not initiate such a service. How then can it be said that the Director-General's refusal to give his written permission places any further or other impediment in his way so as to infringe s. 92? The clear answer to this question must be that it does not. The inability of the prosecutor to engage in the form of inter-State trade which it wishes to undertake is a consequence of the prohibition erected by reg. 4 (2) which, admittedly, is not obnoxious to s. 92, and it no less remains a consequence of that provision notwithstanding the refusal of the Director-General to grant his permission in writing for the importation of the aircraft which the prosecutor wishes to import. It should perhaps be added that while we think that the evidence shows that in considering the prosecutor's application for permission to import aircraft the Director-General took into account the policy laid down by the Government, we are unable to accept the view that this was not a matter proper to be considered by him nor, with respect, do we agree with the conclusion reached by Kitto J. that the refusal to grant the permission sought was, in truth, not the decision of the Director-General but that of the Government.

[48]

Then it is said that the Director-General refused a permit for importation simply because the Minister made known to him that it would be against Government policy to allow the prosecutor to import aircraft for the purpose it proposed. Whether or not the evidence shows this convincingly, I shall assume it to be so. I make this assumption the more readily because, with all respect for those who take a different view, I think that the only consideration by which the Director-General could properly have been guided was the policy of the Government. He is by the Public Service Act made the permanent head of the Department of Civil Aviation, a duly constituted Department of State. The responsible Minister is the Minister for Civil Aviation. The Director-General's function in giving permission, pursuant to the Customs Regulations, for the importation of aircraft is an administrative one which he performs by virtue of his office. He is not like a person charged with a duty of determining some question of fact or a person required himself to exercise a discretion according to defined criteria or guided by defined considerations. Of persons in that position it is true to say that, as Rich J. expressed it, "if they have not understood the section, or have not considered the evidence, or have allowed considerations foreign to the question before them to intrude and distract them from the duty confided to them, mandamus will go to compel them to hear and determine the matter before them according to law": Ex parte Falkiner [1] , repeated in Cuming Campbell Investments Pty. Ltd. v. Collector of Imposts (Vict.) [2] . The following cases provide illustrations, apposite here, of the general principle and of its limitations: Victorian Railways Commissioners v. McCartney and Nicholson [3] ; Andrews v. Diprose [4] . In this case no grounds for the granting of permission to import aircraft are expressed in the Customs Act or the Regulations or in any other statutory instrument. And none are implicit, except that, adopting the words of Latham C.J., the power to relax the prohibition "must be exercised for the purpose of attaining the object and securing the purpose of the Regulations, such object and purpose being ascertained by an examination of the terms of the Regulations": Shrimpton v. The Commonwealth [5] . In such circumstances it is never easy to enumerate the considerations that are relevant to the purpose for which the power is conferred: see Swan Hill Corporation v. Bradbury [6] , per Dixon J. [7] . But, as Dixon J. said in Water Conservation and Irrigation Commission (N.S.W.) v. Browning [8] , there must be some warrant in the provisions, the nature or the subject-matter of the statute before it can be said of a particular consideration that has been acted upon that it is extraneous to the power. And, if some matter may properly be considered, it is, I think, scarcely possible for a court ever to say that too much weight was given to it or that it ought not to have been allowed to outweigh other considerations. That, however, is really immaterial in the view I take. That view is, as I have said, that the Director-General must have regard to the policy of the Government and must exercise his functions accordingly. In considering whether to allow aircraft to be imported it is not only the quality and characteristics of particular aircraft that are in question. The Department of Civil Aviation is concerned with more things than ensuring the airworthiness of aircraft. And the Parliament can if it wishes use its constitutional power of customs control of exports and imports to enable the Executive to pursue economic policies that it considers conduce to the welfare of the Commonwealth. That, among other things, is what as I understand the matter the Customs Regulations, made pursuant to the authority of Parliament, do. The Director-General must of course act within the law, that is he must not act corruptly and he must disobey any direction that is contrary to law. But the only ground of unlawfulness suggested was a contravention of s. 92. And that was not in my view made out.

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