80. We reject the submission that the present decisions are non-justiciable.

81. The respondents dispute that the rules of natural justice -- or, in the more recent terminology, "procedural fairness" -- apply to the decisions made by the liquidator and the Minister in connection with the selection of Elders. Counsel for the liquidator suggested that the decision made by their client was not relevantly distinguishable from any decision requiring to be made by the liquidator of any corporation who had been asked by the shareholders to assess the merits of rival proposals for the concurrent purchase from the corporation, and from the shareholders, of complementary items of property, some of which were owned by the corporation and some by the shareholders. They say that the obligation to accord procedural fairness is not imposed merely by reason of the fact that the relevant decisions were made under statutory authority; s.14 of the Winding Up ordinance, in the case of PMCI assets, and s.5 of the Lands Ordinance, in the case of the lease by the Commonwealth. Counsel contended that nothing said by the Minister, the Department or Mr Yeomans himself regarding an independent assessment could transform the nature of the powers being exercised, and functions being performed, by Mr Yeomans so as "to create any legally significant right, interest or expectation in the appellant unless the same amounted to the creation of a contractual or proprietary right". Reference was made to two unreported decisions in which it was held that the requirements of natural justice did not apply to consideration by government of commercial expressions of interest or tenders: Cord Holdings Ltd v Burke (Smith J of Supreme Court of Western Australia, 22 January 1985) and White Industries Limited v Electricity Commission of New South Wales (Yeldham J of Supreme Court of New South Wales, 20 May 1987). The contention of counsel was that, from first to last, Mr Yeomans was engaged in an evaluation of proposals for the acquisition of assets, and no more; so that the doctrine of natural justice lacked any application.

82. In response, counsel for the appellant made reference to s.58 of the Winding Up ordinance, mentioned above. But, although this provision confers powers of inquiry and remedy upon the Supreme Court of Christmas Island and the Minister, in connection with any apparent breach of duty by the liquidator, it does not prescribe the nature or extent of that duty. Nothing in s.58 imposes an obligation to provide procedural fairness in connection with an exercise by the liquidator of his power of sale; and, of course, the Winding Up ordinance does not apply to any decision by the Commonwealth to lease land in the Territory.

83. However, the absence of a statutory provision imposing a duty of procedural fairness is not necessarily fatal to the appellant's invocation of such a duty. Obligations to accord procedural fairness are rarely imposed by statute, in express terms. Although many of the authorities speak of the obligation as being one implied by the statute, the fact is that the doctrine of procedural fairness has been developed by the judges, in an attempt to shield from unfairness those potentially affected by the exercise of certain legal, including statutory, powers. That doctrine propounds that, unless there is some relevant statutory exclusion, and there is none in the present case, procedural fairness applies to cases falling within specific fact situations. The material question is not whether some reference to procedural fairness can be found in a relevant statute; but, rather, whether the decision of Mr Yeomans to recommend the Elders proposal and the decision of the Minister to accept that recommendation and to enter negotiations with Elders fall within any of the specified fact situations. Fundamental to that question is the nature of the exercise upon which Mr Yeomans was engaged. For the reasons set out above, we reject the view that Mr Yeomans was engaged merely in an evaluation of offers to purchase the assets of PMCI. It follows that cases such as Cord Holdings and White Industries are inapplicable. The question is whether there is an obligation to provide procedural fairness in a situation in which a Minister has promised an independent, impartial and thorough assessment of the merits of competing commercial proposals.

84. The fact situations attracting the obligations of procedural fairness were discussed by the High Court of Australia in Kioa v West [1985] HCA 81; (1985) 159 CLR 550. The fullest exposition of the position is that contained in the judgment of Mason J at pp 582-583, as follows:

"It is a fundamental rule of the common law

doctrine of natural justice expressed in

traditional terms that, generally speaking,

when an order is to be made which will deprive

a person of some right or interest or the

legitimate expectation of a benefit, he is

entitled to know the case sought to be made

against him and to be given an opportunity of

replying to it: ... The reference to 'right

or interest' in this formulation must be

understood as relating to personal liberty,

status, preservation of livelihood and

reputation, as well as to proprietary rights

and interests.

The reference to 'legitimate expectation'

makes it clear that the doctrine applies in

circumstances where the order will not result

in the deprivation of a legal right or

interest. Take, for example, an application

for a renewal of a licence where the

applicant, though he has no legal right or

interest, may nevertheless have a legitimate

expectation which will attract the rules of

natural justice. In Salemi v MacKellar (No.2)

[1977] HCA 26; (1977) 137 CLR 396 Barwick C.J. expressed the

view that the expression 'legitimate

expectation' adds little, if anything, to the

concept of a right. However, later decisions

demonstrate that the concept of 'legitimate

expectation' extends to expectations which go

beyond enforceable legal rights provided that

they are reasonably based: Heatley v

Tasmanian Racing and Gaming Commission (1977)

[1977] HCA 39; 137 CLR 487; F A I Insurances Limited v

Winneke [1982] HCA 26; (1982) 151 CLR 342; Attorney-General

(Hong Kong) v Ng Yuen Shiu [1983] UKPC 2; (1983) 2 AC 629.

The expectation may be based on some statement

or undertaking on the part of the authority

that makes the relevant decision. In the view

of some members of the Court in Salemi (No.2)

the 'amnesty' constituted an example of such

an undertaking. Alternatively, the

expectation may arise from the very nature of

the application, as it did in the case of the

application for a renewal of a licence in F A

I or from the existence of a regular practice

which the person affected can reasonably

expect to continue: Council of Civil Service

Unions v Minister for the Civil Service (1985)

AC 374. The expectation may be that a right,

interest or privilege will be granted or

renewed or that it will not be denied without

an opportunity being given to the person

affected to put his case."

85. The reference by Mason J to the decision of the Judicial Committee of the Privy Council in Attorney-General (Hong Kong) v Ng Yuen Shiu is of some present importance. That case turned upon a promise made by the Hong Kong government, in announcing a new immigration policy, as to the course which it would follow in connection with the removal from its territory of aliens. A representative of the Secretary for Security announced, in answer to a question and in relation to persons who had illegally entered Hong Kong from Macau, that "each case will be treated on its merits". The respondent was such a person but he was not given an opportunity to put his case before a removal order was made against him. The Hong Kong Court of Appeal granted an order prohibiting his removal before an opportunity had been given to the respondent to put his case to the Director of Immigration. Upon appeal the Privy Council affirmed that order, holding that the announcement had given rise to a legitimate expectation by the respondent that he would be accorded a hearing before being removed from the colony, and notwithstanding that there was no statutory entitlement to a hearing.

86. In its Advice the Judicial Committee referred to several authorities relating to the concept of a legitimate expectation. At p 637 the Committee noted:

"The expectations may be based upon some

statement or undertaking by, or on behalf of,

the public authority which has the duty of

making the decision, if the authority has,

through its officers, acted in a way that

would make it unfair or inconsistent with good

administration for him to be denied such an

inquiry."

87. The Committee proceeded to discuss Regina v Liverpool Corporation; Ex parte Liverpool Taxi Fleet Operators' Association (1972) 2 QB 299, a case in which the respondent corporation gave a public undertaking that the number of licensed taxis in the city would not be increased until after a certain private bill became law. In breach of this undertaking the corporation resolved to licence additional taxis. The Court of Appeal restrained it from doing so without first hearing any representations from interested parties. In the Hong Kong case the Judicial Committee quoted the following passage from the judgment of Lord Denning MR at p 308:

" ... the corporation were not at liberty to

disregard their undertaking. They were bound

by it so long as it was not in conflict with

their statutory duty.

It is said that a corporation cannot contract

itself out of its statutory duties. In

Birkdale District Electric Supply Co. Ltd. v

Southport Corporation (1926) AC 355 Lord

Birkenhead said, at p 364, that it was

'a well established principle of law,

that if a person or public body is

entrusted by the legislature with

certain powers and duties expressly

or impliedly for public purposes,

those persons or bodies cannot

divest themselves of these powers

and duties. They cannot enter into

any contract or take any action

incompatible with the due exercise

of their powers or the discharge of

their duties.'

But that principle does not mean that a

corporation can give an undertaking and break

it as they please. So long as the performance

of the undertaking is compatible with their

public duty, they must honour it."

88. Applying the Liverpool case, in the Hong Kong case, the Judicial Committee held, at p 638, that the relevant principle was applicable to an alien, just as much as to a British subject:

"The justification for it is primarily that,

when a public authority has promised to follow

a certain procedure, it is in the interest of

good administration that it should act fairly

and should implement its promise, so long as

implementation does not interfere with its

statutory duty. The principle is also

justified by the further consideration that,

when the promise was made, the authority must

have considered that it would be assisted in

discharging its duty fairly by any

representations from interested parties and as

a general rule that is correct."

89. In In re Preston [1984] UKHL 5; (1985) 1 AC 835 the House of Lords was concerned with a case in which an officer of the Inland Revenue Commissioners had informed a taxpayer that he did not intend to raise any further inquiries into his tax affairs provided that the taxpayer withdrew certain claims. Subsequently, further information came to light, as a result of which the Commissioners took further action against him, in respect of the same transactions. The claim for judicial review failed on the facts, the House affirming the view that the agreement did not preclude the subsequent investigation. But their Lordships unanimously indicated that relief would have been available if the taxpayer had established a breach by the Inland Revenue Commissioners of the agreement. In a speech, with which all other members of the House agreed, Lord Templeman said, at p 864:

"The court can only intervene by judicial

review to direct the commissioners to abstain

from performing their statutory duties or from

exercising their statutory powers if the court

is satisfied that 'the unfairness' of which

the applicant complains renders the insistence

by the commissioners on performing their

duties or exercising their powers an abuse of

power by the commissioners."

"In principle I see no reason why the appellant

should not be entitled to judicial review of a

decision taken by the commissioners if that

decision is unfair to the appellant because

the conduct of the commissioners is equivalent

to a breach of contract or a breach of

representation. Such a decision falls within

the ambit of an abuse of power for which in

the present case judicial review is the sole

remedy and an appropriate remedy."

90. It seems to us that the principles applied in the Hong Kong case and in Preston apply to the present case. There was here no statutory requirement that the liquidator undertake any particular procedure before deciding whether to sell particular assets of PMCI, and, if so, to whom. In the ordinary case, the liquidator would have been free to negotiate with whom he pleased, provided only that he fulfilled his ordinary obligations to the shareholders and creditors of PMCI. Similarly, nothing in the Lands Ordinance, or in any other legislation, had the effect of imposing upon the Minister an obligation to carry out any inquiry or investigation before deciding whether, and, if so, to whom, the Commonwealth should lease the mine site. In the ordinary course this would be a matter for the Minister to determine upon the basis of such information and advice as he thought adequate. A decision upon such a question would ordinarily, we presume, be made by a Minister personally and upon the basis merely of advice from within the Department.

91. However, in the present case the Minister took the exceptional step of promising an independent inquiry before any decision was made in connection with the sale of the PMCI plant and the recommencement of mining. Although he was not bound to take that step, he was free to do so, in the sense that such a step did not conflict with any statutory duty. In his media release the Minister spoke of his "commitment" that "any assessment of future mining operations be undertaken by an independent third party". Later in the document he referred to the "evaluation process" being done "in an impartial and thorough manner". As already noted, this release came to the attention of Mr Guy, to whom the Minister reaffirmed his intention that the inquiry should be fair, impartial and thorough. Having regard to the type of interests involved and the repeated deliberate and unequivocal nature of the Minister's assurances, we are of the opinion that it may properly be said that those assurances gave rise to a legitimate expectation that they would be honoured, that no decision would be made in favour of mining unless and until there had been an independent, impartial and thorough assessment of all available proposals. This is a case in which, although there was no statutory requirement that the liquidator or the Minister proceed by way of an independent, impartial and thorough inquiry, the doctrine of procedural fairness entitles the appellant to hold the Minister to his promise that this procedure would be followed.

92. The view just stated accords with that adopted by French J, save for the fact that he spoke of a more limited expectation: "a legitimate expectation that they" (the Century consortium) "would be given a fair opportunity to present their case". But his Honour went on to hold that the consortium was not denied that opportunity:

"What is a fair opportunity and fair treatment

in the sense required by the rules of natural

justice will vary according to the

circumstances. In this case Century had, in

February 1988, submitted one proposal and

after a meeting with officers of DASETT and

the liquidator, had been invited to resubmit

in further detail. All of this happened of

course, before the liquidator was asked to act

as assessor by the Minister. It is

nevertheless relevant to the determination of

what constituted fair treatment by the

liquidator once he assumed that role. In my

opinion, whatever the content of his

obligation to observe natural justice, it did

not require him to afford to the applicants an

opportunity to rectify omissions or

deficiencies which should have been addressed

in their proposal. In particular, fairness

did not require him to invite the applicants

to submit some formula upon which royalties

could be negotiated or to negotiate such

royalties. The absence of any offer of

payment for the acquisition of the PMCI assets

spoke for itself and on the face of the

submission was explained by reference to the

undertaking of responsibility for demolition

at the termination of the project and for

relocation expenses of employees. There was,

in my opinion, no obligation in fairness on

the liquidator to explore alternatives or to

invite a cash offer. As to the matter of the

financial resources available to the

applicants, it was incumbent on them to make

the position clear in their proposal.

There was substance in the complaint that the

liquidator had misread the submission so far

as it related to meeting demolition costs. It

was, in my opinion, reasonably clear that the

Century group did intend to bear these costs

in their entirety and that the figure of $2

million was no more than the amount of a

security for performance of that obligation to

be provided over the life of the project. But

the misinterpretation of the submission in

that respect, does not constitute a breach of

natural justice. Nor, in my opinion, does the

failure to consult with Century about it.

Fair treatment does not import a protection

against factual error or miscalculation in the

decision making process.

That is not to say that the liquidator should

not, as a matter of prudence, have had further

discussions with Century and the other

proponents. However, the minimum requirements

of fair treatment according to law were met so

far as they related to the opportunity on the

part of Century to put its case."

93. This approach was expressly supported by counsel for the respondents. But, with respect to his Honour, it seems to us that it undervalues the Minister's promise. We agree that an obligation to accord a hearing does not usually carry with it an obligation to direct the attention of an affected person to omissions in his or her case: see Sullivan v Department of Transport (1978) 20 ALR 323 at p 343, Singh v Minister for Immigration and Ethnic Affairs (1985) 9 ALN 13. However, in the present case the Minister did not merely promise an opportunity for the various proponents to put their cases. He promised an independent, impartial and thorough assessment; that is, that the various proposals would be thoroughly evaluated by a person who was independent of DASETT and who was impartial. The Century consortium had a legitimate expectation that this promise would be honoured. Whether it was honoured is not to be answered merely by considering whether Mr Yeomans read what was put before him. The undertaking was to accord a "thorough" assessment of the proposals. The material supplied by Century contained obvious omissions. Mr Inglis and Mr Gardiner pointed some of them out. But, despite the frequent contact between Mr Yeomans and the representatives of Century and the express offers of Mr Guy and Mr Argyle to provide any further information which might be required, Mr Yeomans made no attempt to have the omissions repaired.

94. There were ambiguities about two financial aspects of the proposal: demolition and royalties. In connection with demolition, we share the view of French J that the proposal of Century ought to be read as accepting full responsibility for demolition costs without any expenditure ceiling. Mr Yeomans read the proposal in a different way, as being subject to a $2 million limit. This is a possible interpretation of the consortium's document but it is at best equivocal. Particularly having regard to the amount of money involved, the position ought to have been checked.

95. As regards royalties, the revised Century consortium proposal accepted an obligation to enter into an agreement with the Commonwealth "on royalties based upon the Operations ability to support such payments"; whatever that might have meant. Perhaps the words meant that the level of royalties would be negotiated after Century had been selected and before any agreement was made. Mr Guy gave evidence that he thought that this is what would happen. Upon another interpretation, the Century proposal meant that the royalties should be fixed after mining commenced and in the light of the financial results achieved. Mr Yeomans was entitled to regard either of these propositions as unacceptable; the royalty offer was likely to be maximised by being required to be made before Century had been awarded the right to mine. But, even if this was Mr Yeomans' position, he was not justified, when undertaking a "thorough" assessment of the proposals, in failing to ascertain what was Century's best offer on royalties. It was clear that the consortium was prepared to enter into an agreement concerning royalties. And from a financial point of view, the level of royalty payments was easily the most important aspect of the whole assessment. The income from royalties was likely far to exceed the small nett receipt upon the sale of the plant and equipment. And, if the words used by Century had been intended to convey the first of the two interpretations set out above, they would not have indicated that Century was adopting an intransigent position. In his media release of 11 February 1988 the Minister had said that the "Commonwealth would negotiate the level of royalties", presumably with the successful applicant for the right to mine.

96. The problem of royalties does not stop there. The report compiled by Mr Yeomans for the Minister stated as a conclusion:

"2. Payment by Elders of royalties at $1.70

per tonne shipped exceeds the offer

contained in the Century proposal and

compares favourably with the Booth

proposal which however does offer

slightly higher royalty payments."

97. The form of this paragraph is curious. It was one of four stated reasons for preferring the Elders proposal, the Elders royalty being said to "compare favourably" with an offer which is in fact higher. How much higher Mr Yeomans did not say. A reader of the report could reach no conclusion upon that matter because the royalty offers of Elders and Booth were made upon different bases: in the case of Elders a rate per tonne and in the case of Booth a percentage of FOB price. The report did not contain the information necessary to enable like to be compared with like or the respective gross totals to be ascertained.

98. A similar criticism may be made about the discussion in the report of the rehabilitation of previously mined areas. Elders offered $1 per tonne towards the cost of this work. Booth's proposal "assumes the responsibility to rehabilitate all mined areas". If this was intended to be read literally, that is to apply also to areas mined by PMCI, the offer was better than the Elders offer. It might have been expected that, in a "thorough" assessment, Mr Yeomans would have pointed out this Booth advantage and quantified its extent. He failed to point out the advantage, and he was in no position to quantify it. He made no investigation of rehabilitation costs. If, on the other hand, the Booth offer was intended to relate only to areas mined by Booth, the advantage was to the Elders proposal. From the report it was impossible to tell what was the position.

99. Other valid criticisms of the thoroughness of the report were made in argument. Although the nett capital payment -- that is plant purchase price less demolition cost -- offered by both Elders and Booth was $0.5 million, the offer was structured in different ways. There were obviously taxation implications in the way in which the offers were structured; a matter of legitimate interest to the Minister. Yet, despite his accounting qualifications, Mr Yeomans offered no analysis of the taxation implications.

100. The question whether Mr Yeomans ought to have dealt with the social and environmental consequences of the various proposals is more open to debate. As we have suggested, he was scarcely equipped to do so; yet his brief to assess the proposals was unqualified and these were clearly matters relevant to the merit of the proposals. Perhaps the submission on behalf of the appellant that these matters ought to have been considered goes less to the manner in which Mr Yeomans carried out his task than to the failure of the Minister either clearly to commit this aspect of the matter or clearly to make other arrangements in relation to it.

101. By way of a footnote upon the matter of thoroughness we should refer to a submission put on behalf of the second respondent. That submission was that, if Mr Yeomans formed the view that one proposal was clearly superior to its rivals, he was not bound to consider every aspect of the proposals. If, for example, factor A was of overwhelming importance and one proposal was clearly superior in respect of factor A, Mr Yeomans might properly say so and spare himself the task of comparing the proposals in respect of factors B, C and D. For that reason, it was said, it did not matter that Mr Yeomans did not ascertain the royalty rate which Century would be prepared to pay. We accept the logic of counsel's submission, but we do not think that it has much relevance to the report which Mr Yeomans submitted to the Minister. That report did not identify a factor of overwhelming importance, so that other matters paled into insignificance. On the contrary, it summarised the features of all of the proposals before coming to conclusions based upon the balance of the respective advantages and disadvantages. All relevant factors were thrown into the balance, or were allegedly thrown into the balance, in order to find the most satisfactory proposal. In a case where the assessment is carried out in this way, thoroughness demands that the factors be properly ascertained and stated.

102. The matters of independence and impartiality overlap. The assessment was "independent" in the sense that it was made outside of DASETT. But, as French J found, in a larger sense, Mr Yeomans was not independent. In a comment at the conclusion of his reasoning his Honour said this of DASETT and the Minister:

"Indeed, their approach is not above criticism.

The description of the liquidator as

'independent' was misleading in so far as it

was intended to suggest that he was bringing

to bear a point of view uninfluenced by

departmental attitudes towards the issue of

phosphate mining on the Island. It was a

political device of bureaucratic origin

designed to mollify critics of the

government's approach to the privatisation of

mining on the Island. It shows the

decision-making process challenged in this

case, to have been essentially political and

one which could have been undertaken by the

relevant Minister himself and for which he

could long ago have taken political

responsibility. Given what the relevant

departmental officers must already have known

of Yeomans' views, the characterisation of his

assessment as 'independent' was a tactic

redolent of the approach of the not so

fictitious Sir Humphrey Appleby."

103. We interpret this comment as a finding that, what his Honour elsewhere called, the "political purpose" of designating Mr Yeomans as "independent" was a device to confer respectability upon an outcome pre-ordained by the Minister's advisers. They had the Minister select as a source of "independent" advice a person who had been closely associated with the negotiations for, and the consideration of, the three proposals and whose views were already known to them. It is true that it would have been possible for Mr Yeomans to depart from those views in making his recommendations to the Minister; but his Honour's finding necessarily involves the conclusion that the Minister's advisers thought that this was an unlikely event.

104. Notwithstanding these findings French J rejected the complaint of partiality:

"Under the general rubric of natural justice,

the applicants also complained that they were

entitled to and did not receive impartial

treatment in the evaluation of the Century

proposal. In particular, they said, that the

evaluation was based upon the opinions and

conclusions provided by Inglis and Gardiner.

The draft specifications provided by Thomas of

Elders Resources were also said to have played

an illegitimate part in the evaluation. So

too was predisposition against Bennett and the

UCIW.

So far as the factual underpinning for these

allegations is concerned, I am satisfied on

the evidence that the liquidator took into

account the opinions provided by Inglis and

Gardiner and at least in part adopted them for

the purpose of his evaluation. In my view he

was entitled to do that and it does not

indicate any unfairness in treatment. It may

be the case that their views were coloured by

their experiences as officers of PMCI,

particularly relating to dealings with the

UCIW. And as to the liquidator himself, I

have no doubt that by the time he accepted the

Minister's invitation to assess proposals, he

had formed strong views about Bennett and the

Union which were adverse to them. He was

aware and sceptical of the Century proposal,

at least to the extent that it relied upon

co-operation with the UCIW and derived from

the Arthur Andersen Report.

These conclusions do not however determine

whether there was a breach of the rules of

natural justice. The question of bias and

predisposition in administrative

decision-making of the character here under

review, is not to be approached with that

nicety appropriate to the decisions of courts

and tribunals. This is particularly so where

the decision-maker has a continuing

involvement, and a particular policy or

orientation based upon prior knowledge of

matters relevant to the decision. This is

well illustrated in the case of ministerial

decision making by the observation of

Professor Wade at p 489 of the 6th edition of

his text:

'It is self-evident that ministerial

or departmental policy cannot be

regarded as disqualifying bias. One

of the commonest administrative

mechanisms is to give a minister

power to make or confirm an order

after hearing objections to it. The

procedure for the hearing of

objection is subject to the rules of

natural justice in so far as they

require a fair hearing and fair

procedure generally. But the

minister's decision cannot be

impugned on the ground that he has

advocated the scheme or that he is

known to support it as a matter of

policy.'

...

The fact that the liquidator in this case had

formed views of the reliability of the UCIW

and its secretary and of the prospects of the

Century proposal, does not, in my opinion,

vitiate his decisions. They are impugned as

decisions under s.14 of the Winding Up

Ordinance. Involved, as he was, in the

process of disposing of the assets of the

corporation, he was entitled to take into

account those views he had already formed on

the basis of information received from

departmental sources and former officers of

the PMCI. They were views which bore upon the

acceptability of the Century consortium

proposal to government and therefore upon the

question whether he should dispose of the

assets to that consortium.

The political designation of him as

'independent' had nothing to do with his

function as liquidator. It was designed for a

political purpose. It did not attract to the

discharge of his functions under the Winding

Up Ordinance any greater obligation than those

imposed by that statute."

105. It seems to us that, in the situation which here occurred, it does not matter whether one describes Mr Yeomans as lacking independence or as lacking impartiality. Putting the position at its lowest, a fair-minded person who was aware of the facts might, in such circumstances, entertain a reasonable apprehension that Mr Yeomans might not bring an impartial and unprejudiced mind to the task which was committed to him. This is the test of bias applicable to judicial proceedings: see Livesey v New South Wales Bar Association (1983) 151 CLR 188. We agree with French J that it is a test which will not usually be appropriate in connection with administrative decisions. Ministers and other administrators frequently have a continuing relationship with a particular issue or particular person during the course of which they necessarily form views; in practice it would generally be impossible for them to bring an open mind to a new decision pertaining to that issue or person. But respectfully disagreeing with French J, we think that, in this unusual case, the test applicable to judges is relevant. As is illustrated by the decision in Regina v Kent Police Authority; Ex parte Godden (1971) 2 QB 662, there are cases in which it is appropriate to apply the judicial test to administrative decisions. In the present case the decisions to be made by the liquidator and the Minister were each administrative decisions; but they were decisions affecting substantial commercial interests in respect of which the Minister had repeatedly promised an "impartial" assessment. To adopt the approach of his Honour, overlooking the fact that Mr Yeomans "had formed views of the reliability of the UCIW and its secretary and of the prospects of the Century proposal", would be to strip the Minister's promise of its content. If a Minister, though not legally bound to do so, chooses to announce that a particular decision will be preceded by an "impartial" assessment, members of the public are entitled to expect that the person who will make that assessment will bring to that task a mind which is both uncommitted in fact and which appears to be uncommitted. The reason was spelled out in a passage from the judgment of Lord Denning MR in Metropolitan Properties Co (FGC) Ltd v Lannon [1968] EWCA Civ 5; (1969) 1 QB 577 which was quoted by Barwick CJ, Gibbs, Stephen and Mason JJ in The Queen v Watson; Ex parte Armstrong [1976] HCA 39; (1976) 136 CLR 248 at p 259:

"... in considering whether there was a real

likelihood of bias, the court does not look at

the mind of the justice himself or at the mind

of the chairman of the tribunal, or whoever it

may be, who sits in a judicial capacity. It

does not look to see if there was a real

likelihood that he would, or did, in fact

favour one side at the expense of the other.

The court looks at the impression which would

be given to other people. Even it he was as

impartial as could be, nevertheless if

right-minded persons would think that, in the

circumstances, there was a real likelihood of

bias on his part, then he should not sit. And

if he does sit, his decision cannot stand. ...

Nevertheless there must appear to be a real

likelihood of bias. Surmise or conjecture is

not enough ... There must be circumstances

from which a reasonable man would think it

likely or probable that the justice, or

chairman, as the case may be, would, or did,

favour one side unfairly at the expense of the

other. The court will not inquire whether he

did, in fact, favour one side unfairly.

Suffice it that reasonable people might think

he did. The reason is plain enough. Justice

must be rooted in confidence: and confidence

is destroyed when right-minded people go away

thinking: 'The judge was biased.'"

106. The application of this standard in the present case leads inexorably to the conclusion that Mr Yeomans should have been regarded, and should have regarded himself, as being disqualified to conduct the assessment. Whatever his actual state of mind on 13 May 1988, an impression of bias must inevitably have arisen. Mr Yeomans had expressed antipathetic views about UCIW and Mr Bennett within days of his appointment as liquidator. He had considered the Arthur Andersen report, upon which even the revised Century proposal was substantially based, in early February. He had formed an adverse view of the proposal for a resumption in mining, particularly because of his opinion of UCIW but also because of other matters. The trial Judge found that, at the meeting of 26 February, Mr Yeomans criticised the Century proposal and Century's involvement with UCIW. At that meeting his attitude was that, if UCIW was involved in the consortium, it would run into trouble. That attitude was strikingly illustrated by his action in telling the fable of the frog and the scorpion, an act which the trial Judge found conveyed a "serious message" reflecting Mr Yeomans' scepticism about the likely success of the Century consortium. There was nothing in his subsequent conduct, up to 13 May, which would cause any observer to believe that this scepticism had abated. According to his Honour's findings, the Minister's advisers did not think it had. Neither did Mr Guy, who promptly wrote a letter protesting the selection of Mr Yeomans for the task.

107. Nothing that we have written is intended to suggest that the various criticisms which were made of the Century proposals, of the Arthur Andersen report, of UCIW or of Mr Bennett were unjustified in point of fact. The validity of those criticisms was not a matter for the trial Judge; it is not a matter before us. It is a matter about which we have no view. We simply make the point that, however justified the opinions which Mr Yeomans had formed by 13 May, the fact that he held those opinions meant that it was impossible properly to regard him as an impartial assessor.

108. The Minister promised an assessment which would be independent, impartial and thorough. The assessment made by Mr Yeomans was none of these. The procedural fairness ground is made out. The decision of Mr Yeomans to recommend that the Elders proposal be accepted must be set aside. The Minister's decision to commence negotiations with Elders was based upon that recommendation. It has been made without the promised independent, impartial and thorough assessment. Consequently, that decision also must be set aside.

109. Counsel for both respondents submitted that, if the Court were of the opinion that any one of the impugned desicions was bad in law, the Court should refuse relief on discretionary grounds. There is no doubt that a discretion exists. Section 16(1) of the Administrative Decisions (Judicial Review) Act provides:

"16. (1) On an application for an order of

review in respect of a decision, the Court may, in

its discretion, make all or any of the following

orders:--

(a) an order quashing or setting aside the

decision, or a part of the decision, with

effect from the date of the order or from

such earlier or later date as the Court

specifies;

(b) an order referring the matter to which

the decision relates to the person who

made the decision for further

consideration, subject to such directions

as the Court thinks fit;

(c) an order declaring the rights of the

parties in respect of any matter to which

the decision relates;

(d) an order directing any of the parties to

do, or to refrain from doing, any act or

thing the doing, or the refraining from

the doing, of which the Court considers

necessary to do justice between the parties."

110. The basis of the submission on discretion is futility. During the hearing of the appeal we admitted into evidence copies of letters written by Mr Bennett to Century, to the Minister, to Elders and to the solicitors previously acting for UCIW in connection with the appeal. In the letter to Elders Mr Bennett stated that negotiations "are continuing" between UCIW in respect both of an industrial agreement and a joint venture agreement. The other letters refer to an intention by UCIW to enter into an agreement with Elders.

111. Counsel for each of the respondents argued that, in the light of these letters, it would be futile to set aside the recommendation and decision in favour of Elders. The Century consortium had disintegrated, they said. If the recommendation and decision were set aside and the proposals were remitted for further consideration, Century would not benefit; its proposal depended upon the involvement of UCIW, so that the withdrawal of UCIW destroyed the proposal. Accordingly, no good purpose would be served by forcing a reconsideration of the matter.

112. We do not accept this submission. The letters make clear that UCIW is prepared to deal with Elders, both industrially and in a joint venture. However, it is equally clear that this is a response to the present situation in which UCIW finds itself; Elders is the selected miner. UCIW is unwilling to accept any further delay. Apparently no agreement has yet been made. If Elders ceased to be the selected miner, so far as we are aware, there would be no barrier to UCIW reverting to its original position as a partner of Century. We have no reason to assume that Century would be unable to achieve the support of UCIW for a renewed joint proposal. The problem raised by counsel is one that flows from the invalid recommendation and decision. The problem may be reversible. We would compound the injustice already done to Century if we denied the company, on discretionary grounds, the opportunity to seek that reversal.

113. The recommendation and decision must be set aside and the matter remitted to the Minister for further consideration. We do not remit the matter to Mr Yeomans. For the reasons we have indicated, we are of the opinion that it is impossible for Mr Yeomans to undertake the independent, impartial assessment promised by the Minister. If there is to be further consideration of proposals for mining on Christmas Island, that task will need to be given to someone else; desirably a person who has had no previous association with the matter.

114. One other aspect of the present situation should be mentioned. More than twelve months has elapsed since the Minister decided to select Elders. The effect of the orders to be made in this appeal will be to recommit that decision for further consideration. But that reconsideration should be made upon the basis of up-to-date information: see Minister for Aboriginal Affairs v Peko-Wallsend Ltd, especially the reference by Mason J at p 45 to "the general principle that an administrative decision-maker is required to make his decision on the basis of material available to him at the time the decision is made".

115. We are not aware of the extent of any changes in relevant circumstances in the period which has elapsed since the decision was made. There may be changes other than in the allegiance of UCIW. Several of the documents admitted into evidence, including some departmental memoranda, contain reference to the likely speedy deterioration of the mining equipment. We do not know to what extent this has occurred. It appears that many people have left the Island. This may affect the viability of one or more of the proposals. Work has apparently been under way in connection with environmental protection.

116. There are probably other matters, not alluded to in the evidence. It is for the Minister to determine the scope of the matters which he will take into account in deciding what course now to pursue. Our point is that, in considering those matters which he considers to be relevant, he should do so upon the basis of the material available to him at this time. He should not restrict himself to the material which existed in June 1988. It may be that, having considered the up-to-date position, the Minister will decide against a recommencement of mining on the Island by any party; in which case there would be no necessity for any further assessment process. Alternatively, the Minister might decide in favour of mining, at least in principle, and commission a suitable person to carry out the promised independent, impartial and thorough assessment of proposals. If that course is followed, adequate time must be allowed to enable interested parties to revise their proposals in the light of any changed circumstances.

117. The appeal should be allowed. The orders made by French J should be set aside. In lieu thereof it should be ordered that the decision made by the first respondent to make the recommendations contained in his report to the second respondent dated 23 May 1988 and the decision of the Minister on 1 July 1988 to commence negotiations with Elders about recommencing mining on Christmas Island each be set aside and the matter of mining on Christmas Island be remitted to the Minister for further consideration. The respondents must pay the costs of the appeal and of the proceedings at first instance.