R v Halton; Ex parte AUS Students Travel Pty Ltd

A holder of a licence or any other person who arranges any travel by persons or carriage of cargo in respect of which a charge is included in a tariff of charges approved, or directed to be adopted, under this regulation shall charge and demand in respect of that travel or carriage an amount not less than the amount of that charge.

The prosecutor is a "person" which, in terms of this sub-regulation, arranges travel. In the instances of travel here in question it has employed, in connexion with these arrangements, planes chartered by it from Malaysian Airlines System (M.A.S.) for that purpose. The travel which it has thus arranged for each of its customers consists of a non-scheduled flight to Kuala Lumpur in a M.A.S. plane chartered by it, followed by on-carriage from there by regular scheduled airline services, including but not confined to M.A.S., to a variety of Asian and European destinations.

The attraction of travel by this means is that not only is the cost of the initial sector of the journey, by chartered plane from Australia to Kuala Lumpur, much cheaper than is the regular economy fare but also that the cost over subsequent sectors, from Kuala Lumpur onwards, albeit by means of regular scheduled airline services, is less than the amount ordinarily charged to an intending passenger in Australia wishing to travel on those routes.

It is this latter feature which has given rise to the present proceedings, and in this way: the initial stage of the journeys arranged by the prosecutor being by non-scheduled, chartered aircraft the provisions of s. 14 of the Air Navigation Act apply. Sub-section (2) of that section is as follows:

Where an aircraft that possesses the nationality of a Contracting State makes a non-scheduled flight into Australian territory, it shall not take on or discharge passengers, cargo or mail in Australian territory (being passengers, cargo or mail that has been, or is to be, carried for reward) except with the permission of the Secretary and in accordance with that permission. M.A.S. sought permission in terms of this sub-section in respect of a number of flights scheduled for the months of May and June of this year which its aircraft were to operate under charter to the prosecutor. That permission was refused by the delegates of the Secretary and it is in respect of the refusal of that permission that the prosecutor now seeks mandamus.

The decision to refuse permission was expressed to have been made after taking into account four considerations, one of which was stated in these terms:

The carriage of passengers on combination fares, which involve scheduled service travel at fare levels below those filed and approved by the Department, is in breach of the provisions of ANR 106a.. The importance attached to this particular consideration is apparent from the concluding paragraph of the refusal, which states that the decision will be reconsidered if the prosecutor undertakes that passengers' travel documentation will show compliance with reg. 106A and, in particular, that such passengers will be paying "the fare levels approved by this Department", that is, the Department of Transport, for travel on scheduled airline services on sectors beyond Kuala Lumpur. It will be seen that no objection is taken by the Department to the cheap fare charged for the sector of travel flown by chartered M.A.S. planes between Australia and Kuala Lumpur. It is not cheap fares on chartered flights but cheap fares on scheduled airline services to which the Department objects in this instance.

The prosecutor contends that the Department's understanding of the effect of reg. 106A is mistaken, that in arranging travel to ultimate destinations in Europe and Asia at fares which, for sectors beyond Kuala Lumpur, are lower than approved fare levels it has, upon a proper construction of sub-reg. (7) of that regulation, committed no breach of that sub-regulation. In the alternative, it says that if it is in breach, then the regulation must, in relevant respects, be ultra vires the regulation-making power since it exceeds the ambit of Commonwealth legislative power.

The prosecutor's contention involves the proposition that sub-reg. (7) has not, and, as a matter of statutory and constitutional validity, cannot have, any application to the charges made for sectors of travel beyond Kuala Lumpur which it has arranged for its passengers. Sub-regulation (7) is concerned with travel "in respect of which a charge is included in a tariff of charges approved under this regulation". It is to sub-reg. (1) that one must turn to learn of precisely what charges sub-reg. (7) speaks: sub-reg. (1) provides:

The holder of a licence to operate an international air service to or from Australian territory shall submit to the Secretary his tariff of charges for travel by persons and carriage of cargo (including travel and carriage part of which is to be undertaken by surface transportation or by any other air or surface carrier) that comprises, or any part of which includes, transportation on that service. A relevant tariff of charges is, then, one submitted by the holder of a licence to operate an international air service to or from Australian territory and which is a tariff of charges "for travel by persons (including travel part of which is to be undertaken by any other air carrier) that comprises, or any part of which includes, transportation on that service". The reference to "that service" is clearly enough a reference back to the operator's international air service to or from Australian territory.

It aids in understanding the working of the regulation if some factual background, garnered from the evidence, be now referred to. Each of the twenty-four operators of international services into Australia has filed with the Department of Transport and has received approval for its tariff of charges. The tariffs so approved precisely reflect the charges prescribed under the current tariff of the International Air Transport Association (I.A.T.A.) an association to which a majority of the operators of international air services belong and whose decisions are accorded recognition in Commonwealth legislation - e.g., s. 14 (4) (c) of the Air Navigation Act 1920. In consequence the charge shown for any flight sector in any tariff of charges approved under reg. 106A is and always has been identical with the charges (if any) shown for the same sector in any other approved tariff of charges. Neither M.A.S. nor either of the two other operators of international air services on whose scheduled flights the prosecutor has arranged for its customers to fly from Kuala Lumpur on to their ultimate destinations are members of the I.A.T.A. Nevertheless all three do operate international air services into Australia, hold licences to do so issued under the Air Navigation Act and have filed tariffs which have received the necessary approval and which show the same charges for particular sectors as do all other tariffs which refer to those sectors. Very many, and perhaps all, of the sectors over which the prosecutor's passengers are to be carried after reaching Kuala Lumpur are ones for which charges appear in the tariffs filed by the particular one of these three airlines which will in fact be carrying those passengers over those sectors.

It follows that in seeking to apply sub-reg. (7) to the case of the travel here in question it makes no difference whether it be the tariffs of the actual airlines by which the prosecutor's customers are in fact to be carried beyond Kuala Lumpur which are consulted or whether the tariffs of other airlines which also operate the relevant sectors are looked at: their tariff charges will be the same and will constitute the minimum charge for the purposes of sub-reg. (7).

In other circumstances it might be material to determine whether or not the reference in the sub-regulation to travel "in respect of which a charge is included in a tariff of charges" confines attention to the actual carrier's tariff or instead permits any tariff, so long as it quotes charges for the particular route to be travelled, to be consulted. The former would seem, in a number of respects, to be the better view; but since charges are, under prevailing circumstances, uniform for all carriers the point does not arise.

It being common ground that the charges for most, and probably for all, of the sectors of travel beyond Kuala Lumpur arranged by the prosecutor are less than approved tariff charges for those sectors, it follows that the prosecutor is either already in breach of sub-reg. (7) in relation to such travel or will be as soon as it reaches the stage of charging and demanding amounts from individual customers in respect of their travel.

It was urged by the prosecutor that, whatever might be the current practice as to the submission and approval of tariffs, sub-reg. (1) of reg. 106A in fact contemplated that only tariffs in respect of travel on routes the subject of licences granted by the Australian licensing authorities should be submitted for approval: in the case of M.A.S., for example, tariffs would thus be confined to the sectors Kuala Lumpur-Melbourne/Sydney and Kuala Lumpur-Perth, those routes being the limit of its licence. In my view this unduly restricts the scope of sub-reg. (1): for the tariff of charges of an Australian-licenced operator of an international air service to require submission under sub-reg. (1) it is enough that it be a tariff of charges for travel which "comprises" or "any part of which includes" transportation on the service to or from Australian territory for which the operator is licensed. Thus, if an Australian-licensed airline operates a route any part of which includes transportation to or from Australia, its tariff of charges for that route must be submitted for approval.

Since I reject the operator's submission on construction it follows that the only remaining contention that can avail it is one which attacks the validity of reg. 106A. It is said that to the extent to which the regulation purports to concern itself with travel beyond sectors which begin or end in Australia, travel beyond Kuala Lumpur to ultimate destinations in Europe or Asia being an instance, it not only exceeds the regulation-making power conferred by the Air Navigation Act but also the legislative power of the Commonwealth. The wide terms in which the power to make regulations is conferred by s. 26 of the Air Navigation Act are such as to make it unnecessary to consider the first of these two suggested grounds of invalidity: if the regulations are within legislative power they will fall within the statutory power to make regulations. Nor can it, in my view, be doubted but that the Commonwealth has ample power to legislate with respect to aspects of travel, wherever geographically occurring, which have a sufficient connexion with travel by air between Australia and overseas. Reliance only upon the trade and commerce power conferred by s. 51 (i.), without need for recourse to the external affairs power in s. 51 (xxix.), will provide a source of power to legislate with respect to on-carriage beyond the first overseas stopping place, in this case Kuala Lumpur, at least where the example of international trade or commerce in question is one involving, as in this case, ultimate destinations themselves lying beyond that first overseas stopping place and where what is legislated for is, as is again this case, the arranging in Australia of travel to those ultimate destinations. How much more extensive the power may be calls for no present investigation. It is enough to conclude that the power is emple to authorize the regulation of charges to be paid for in Australia in respect of travel to or from Australia on all sectors of flights to overseas destinations.

Accordingly in my view sub-reg. (7) is valid and compliance with it might properly be a matter for consideration in the grant or refusal of permission under s. 14 of the Air Navigation Act. It follows that no case for the grant of mandamus has been made out. The order nisi should be discharged.

I have had the advantage of reading the reasons for judgment prepared by Stephen J. with which I agree.

When the decision was made to refuse permission under s. 14 (2) of the Air Navigation Act 1920 Cth for a charter flight by Malaysian Airlines System ("M.A.S.") from Sydney to Kuala Lumpur a matter taken into account was that the proposed charter was to the prosecutor and that the prosecutor had contrary to reg. 106A (7) of the Air Navigation Regulations, in respect of passengers on the proposed flight, arranged travel onwards from Kuala Lumpur in respect of which a charge was included in a tariff of charges approved under reg. 106A (1) and (2) and had charged in respect of that travel an amount less than the charge in the approved tariff. It was open to the Department to take this factor into account by virtue of s. 14 (4). The complaint of the prosecutor is that the Department either misconstrued reg. 106A or took it into account when it was invalid in law.

First, the alleged misconstruction of reg. 106A. It is necessary to examine sub-reg. (1).

The holder of a licence to operate an international air service to or from Australian territory shall submit to the Secretary his tariff of charges for travel by persons and carriage of cargo (including travel and carriage part of which is to be undertaken by surface transportation or by any other air or surface carrier) that comprises, or any part of which includes, transportation on that service. It was submitted on behalf of the prosecutor that as M.A.S. only held a licence to operate an international air service from Australia to Malaysia, its only relevant tariff of charges was that in respect of a flight service the whole or part of which particular service had as part of its itinerary the route between Australia and Malaysia. Therefore, it was said, a flight service from Sydney, through Kuala Lumpur, on to, say, London would be one which fell within sub-reg. (1) and consequently the tariff of charges in respect of that service would fall within sub-reg. (7). But in respect of travel from Sydney to Kuala Lumpur on one service and then a transfer at Kuala Lumpur to another service such as Tokyo-Kuala Lumpur-London there was no requirement of a submission and approval of a tariff of charges in respect of the flight Kuala Lumpur-London.

I cannot accept that reg. 106A operates in that way. If the licence holder has a tariff of charges for travel and if there are items in that tariff which include the travel from Sydney to Kuala Lumpur and also the travel on from Kuala Lumpur, then the tariff must be approved in respect of the whole of that travel, whether or not the onward stages are by way of carriage on a flight service the itinerary of which includes the travel from Sydney to Kuala Lumpur. This, it seems to me, is made quite clear by the words in parenthesis - the references to surface transportation and to carriage by any other air or surface carrier. I cannot read these references as limited to surface transportation or other air or surface carriers in respect of which there is a licence to operate an international air service to or from Australian territory. It just would not make sense. Sub-regulation (1) is in its terms comprehensive of all carriage and travel any part of which includes transportation on the Australian sector. So it does not matter whether the travel is partly by air and then by sea or land or wholly by air on different services after the Australian sector. All are included.

If that is the operation of sub-reg. (1) it is submitted that it is invalid - beyond the regulation-making power and beyond constitutional power. The regulation-making power is as wide as the constitutional power (see s. 26), so the constitutional power alone needs to be considered. Since the travel in respect of which the tariff of charges must be submitted under reg. 106A (1) is travel the whole or part of which comprises transportation on an international air service to or from Australian territory, there can be no doubt that the requirement is within constitutional, and consequently the regulation-making, power. If nothing else, it is with respect to trade and commerce with other countries. I need go no further, though there are in my opinion other sources of the power to make the regulation.

The evidence discloses that charges for travel beyond Kuala Lumpur in respect of a number, if not all, of the onward flights arranged for passengers on the proposed charter by the prosecutor are included in the tariff of charges submitted by M.A.S. and approved under reg. 106A. The charges made by the prosecutor are less than those so approved and a breach of reg. 106A (7) is thus established. It is not necessary to determine whether the scope of sub-reg. (7) is wide enough to include not only the tariffs of the licence holder who in the particular case provides the transportation on the Australian sector but also the tariffs of charges submitted by other licence holders and approved under reg. 106A.

I agree with the reasons for judgment of my brother Stephen and have nothing to add.