Fish and fisheries - Objection proceedings to proposal to vary aquaculture licence - Applicant for licence variation withdrew application after objection proceedings transferred to State Administrative Tribunal - Application for costs by objector against Executive Director, Department of Fisheries - Whether State Administrative Tribunal Act 2004 (WA) s 87 applied - Proceedings dismissed - Each party to pay own costs

Fish Resources Management Act 1994 (WA), s 148, s 149, s 152

State Administrative Tribunal Act 2004 (WA), s 17(1), s 39(1)(a), s 87(1), s 87(2), s 87(3), s 87(4), s 167(4)(a)

Objector's application for Executive Director to pay its costs dismissed; each party to pay its own costs

City Gate Properties Pty Ltd and City of Bunbury [2005] WASAT 53

Shark Bay Tuna Farms Pty Ltd v Executive Director Fisheries Western Australia [2000] WASC 79

1 In June 1998, the Executive Director, Department of Fisheries Western Australia proposed to grant a variation to an existing lease held by the Bellotti Aquaculture Group Aboriginal Corporation to permit it to farm non-maxima black pearls in the Shark Bay region. Shark Bay Tuna Farms Pty Ltd objected to the making of that decision as it was entitled to do under the Fish Resources Management Act 1994 (WA) as it then applied.

2 The Minister for Fisheries then set up a Fisheries Objection Tribunal under the Fish Resources Management Act 1994 to consider the objection.

3 As at 1 January 2005, when the State Administrative Tribunal came into existence, the objection proceedings before the Fisheries Objection Tribunal had not been determined. As a result, the objection proceedings were transferred to the new Tribunal pursuant to the State Administrative Tribunal Act 2004 (WA).

4 Upon the objection proceedings being transferred to the State Administrative Tribunal, the aboriginal corporation indicated that it wished to withdraw its application for variation of its existing lease to permit non-maxima black pearl farming. As a result, the objection proceedings before the Tribunal effectively came to an end.

5 However, Shark Bay Tuna Farms Pty Ltd considered that the Executive Director, Fisheries Western Australia should pay its costs of the proceedings.

6 The Tribunal decided that under State Administrative Tribunal Act 2004 s 87 costs will not ordinarily be ordered in review proceedings. However, where a party can show that a decision-maker did not make its decision in good faith, or there are other relevant grounds to show that costs should be awarded against the decision-maker, costs may be awarded.

7 However, in this case, the Tribunal found there was no evidence to support Shark Bay Tuna Farms Pty Ltd's contentions that an administrative error made by Fisheries Western Australia concerning the distance between the two leases concerned, and the circumstances in which the proposed decision was made, should result in an award of costs being made against the Executive Director in this case. In particular, the Tribunal found there was no evidence to establish that the Fisheries officers who advised the Executive Director, or the Executive Director, acted without good faith.

8 As a result, the Tribunal ordered that the proceedings before the Tribunal should be dismissed with each party paying its own costs.

9 On 1 August 2005 the Tribunal heard the application of Shark Bay Tuna Farms Pty Ltd (applicant) for an order for costs against the Executive Director, Department of Fisheries Western Australia (Fisheries) in objection proceedings that had effectively come to an end when the third party that had originally applied for the licence variation objected to, withdrew its application for variation.

10 On 17 June 1998 pursuant to Fish Resources Management Act 1994 (WA), s 148 (FRMA) the Executive Director caused a "Notice of Proposed Decision" to be published in The West Australian newspaper. That advertisement indicated that the Executive Director proposed to vary an aquaculture licence held by Bellotti Aquaculture Group Aboriginal Corporation to include Pinctada Margaritifera. Put colloquially, the variation would have permitted the aboriginal corporation to farm non-maxima black pearls.

11 The aboriginal corporation's lease, the subject of the proposed variation to permit this activity, was at that time thought by Fisheries to be a distance of some 2.75 nautical miles (nm) from a lease held by the applicant on which the applicant farmed non-maxima black pearls.

12 The reference to "non-maxima" and "maxima" pearl farms is respectively a reference to the different types of pearl production. The hatchery production of Pinctada Maxima pearl oysters involves the recruitment of oysters in the wild. By contrast, hatchery production of P. Margaritifera black lip pearl oyster involves the supply of juveniles selected from high quality brood stock. Black pearl production, through culture of P. Margaritifera, has developed over a number of years and is referred to as non-maxima farming.

13 On 30 June 1998, soon after it learned of the proposed decision, the applicant lodged an objection to the proposed decision, as it was entitled to do pursuant to FRMA s 149 as it then applied.

14 In accordance with FRMA s 149(4), the respondent referred the applicant's objection to the Minister for Fisheries and on 7 September 1998 the Minister established a Fisheries Objections Tribunal under FRMA s 152, as it then applied, to hear and determine the matter and make such decisions as it thought fit.

15 Subsequently, certain questions of law were referred to the Supreme Court of Western Australia by the Fisheries Objection Tribunal and were determined by the Supreme Court in a decision on 7 April 2000: Shark Bay Tuna Farms Pty Ltd v Executive Director Fisheries Western Australia [2000] WASC 79.

16 It appears that unsuccessful attempts were made to settle matters in dispute between the parties between November 2000 and April 2002.

17 As of 1 January 2005, when the State Administrative Tribunal was established, the objection proceedings before the Fisheries Objection Tribunal had not been finally determined. By reason of the State Administrative Tribunal Act 2004 (WA) (SAT Act) s 167(4)(a), the matter before the Fisheries Objection Tribunal was transferred to the Tribunal, that matter being one in which the hearing, consideration or determination had been sought or initiated but not commenced before the Fisheries Objection Tribunal.

18 Upon transfer to the Tribunal, the matter was listed for an initial directions hearing on 23 February 2005. The Tribunal then ordered that the parties should file written submissions by 30 March 2005. At that point, the aboriginal corporation was involved in the proceedings as an "intervenor". As intervenor it was directed to file and serve written notice, whether or not it intended to proceed, by close of business 11 March 2005.

19 The aboriginal corporation then indicated that it wished to withdraw its application for variation of its existing lease and to withdraw as intervenor in the proceedings.

20 On 12 April 2005, the Tribunal ordered that upon the Tribunal receiving from the aboriginal corporation a duly executed and sealed copy of a notice of withdrawal as intervenor in the proceedings, the aboriginal corporation would cease to be a party to the proceedings. A notice of withdrawal was subsequently lodged on behalf of the aboriginal corporation on 4 May 2005.

21 It was understood by all parties, including the aboriginal corporation, that, as a result of the aboriginal corporation withdrawing its application under the FRMA for the variation of its existing lease, and withdrawing from the proceedings as intervenor, the proposed decision became entirely academic and the proceedings before the Tribunal were effectively at an end. As counsel for the Exective Director put it in oral submissions to the Tribunal in the cost application, the applicant had effectively "won" the objection proceedings.

22 Notwithstanding that it had effectively "won" the proceedings, the applicant was concerned that it had been put to great expense over many years and that the Executive Director should meet its costs in the proceedings. It was that application for costs that came before the Tribunal for determination on 1 August 2005.

23 At the costs hearing, Mr McGowan, a Director of the applicant, represented the applicant, as he was entitled to do under SAT Act s 39(1)(a). The Executive Director was represented by counsel.

24 The applicant, in its written submissions to the Tribunal, said it would like compensation for the costs it had been put to by Fisheries "allowing" the aboriginal corporation's application to have a pearl farm within five nautical miles of its lease. It estimated its costs for lawyers and corporate services was in excess of $100 000, not taking into account incidental costs and loss of earnings which made the total sum considerably more. In a separate calculation of costs, for the purposes of the costs hearing, the applicant itemised its various legal expenses over the period, including for the Supreme Court proceedings, to be in excess of $21 000. In addition, the applicant estimated that a further $20 000 would not be excessive to cover other expenses it had incurred and opportunities it had lost.

25 In its written submissions, the applicant raised four grounds to support an order for costs being made in its favour, namely:

(1) the aboriginal corporation was in default of its aquaculture licence conditions as they made no effort to work their aquaculture lease over a four-year period contrary to Fisheries Western Australia rules;

(2) the aboriginal corporation was also in default as at the time of their application to put pearl shell on their lease, the applicant understands they had not paid any licence fees for their site;

(3) the decision to grant the aboriginal corporation a licence was based on false information regarding the distance between the aboriginal corporation's lease and the applicant's lease as at 11 June 1998;

(4) the Department's Senior Fish Pathologist, Dr Brian Jones, was "coerced" to change his opinion concerning the desirability of making the decision by another Department officer, Mr Cameron Westaway.

26 At the hearing, Mr McGowan for the applicant conceded grounds 1 and 2 could not be relied upon. Each was an issue raised in the Supreme Court proceedings and was not relevant to the review proceedings commenced before the Fisheries Objection Tribunal and transferred to the State Administrative Tribunal.

27 As a result, at the costs hearing, the applicant relied on grounds 3 and 4 to make out its claim for costs.

28 It is generally understood that the State Administrative Tribunal provides a "no cost" jurisdiction, at least in relation to its review jurisdiction as that expression is described in SAT Act s 17(1). The proceedings in the Fisheries Objection Tribunal that were transferred to the State Administrative Tribunal are within the review jurisdiction of the Tribunal.

29 SAT Act s 87(1) provides that "unless otherwise specified in this Act, the enabling Act, or an order of the Tribunal under this section, parties bear their own costs in a proceeding of the Tribunal".

30 However, the Tribunal has the power to award costs in a review proceeding in appropriate circumstances. This is confirmed by SAT Act s 87(2) which provides that "unless otherwise specified in the enabling Act, the Tribunal may make an order for the payment by a party of all or any of the costs of another party".

31 Further, by SAT Act s 87(3):

"[t]he power of the Tribunal to make an order for the payment by a party of the costs of another party includes the power to make an order for the payment of an amount to compensate the other party for any expenses, loss, inconvenience, or embarrassment resulting from the proceeding or the matter because of which the proceeding was brought."

32 SAT Act s 87(4) also specifically provides that:

"Without limiting anything else that may be considered in making an order for the payment by a party of the costs of another party where the matter that is the subject of the proceeding comes within the Tribunal's review jurisdiction, the Tribunal is to have regard to -

(a) whether the party (when bringing or conducting the proceeding before the decision-maker in which the decision under review was made) genuinely attempted to enable and assist the decision-maker to make a decision on its merits;

(b) whether the party (being the decision-maker) genuinely attempted to make a decision on its merits."

33 As the Tribunal rightly stated in City Gate Properties Pty Ltd and City of Bunbury [2005] WASAT 53 at [28];

"It is apparent from the terms of s 87(1) of the Tribunal Act that the starting proposition in this Tribunal is that parties bear their own costs in a proceeding. However, s 87(2) clearly confers a discretion on the Tribunal to make an order for the payment by a party of all or any of the costs of another party unless otherwise specified in an enabling Act."

34 As the Tribunal in City Gate Properties Pty Ltd and City of Bunbury (supra) went on to observe, the Western Australian Civil and Administrative Review Tribunal Task Force Report on the Establishment of the State Administrative Tribunal (May 2002) at page 154 observed that:

"Normally, in relation to an administrative review matter, each party should bear its own costs in the proceeding."

35 In City Gate Properties Pty Ltd and City of Bunbury at [29-31], the Tribunal correctly observed that this position is consistent with a well recognised position in a merits based administrative review of a decision of a public decision-maker, where the review tribunal is required to exercise the powers of the original decision-maker afresh. It is appropriate that the discretion as to costs be usually exercised such that each party should bear its own costs of the merit review.

36 In this regard, the State Administrative Tribunal has been established by the Parliament of the State with its review jurisdiction as part of the system of public administration of the State to ensure that the citizens and other entities may seek administrative justice in relation to decisions that affect their personal, proprietary and financial interests. The starting out position is that, absent other relevant factors, an applicant should be able to obtain review without being obliged to meet the decision-maker's costs if they do not succeed; and similarly, the decision-maker is not ordinarily entitled to recover costs from the applicant in the event the review application is unsuccessful.

37 In this case, as counsel for the Executive Director accepted, if the applicant could make out either grounds 3 or 4 then it would be able properly to contend that the Executive Director had not genuinely attempted to make the proposed decision on its merits as referred to in SAT Act s 87(4)(b) and so make out a case for costs.

38 However, the Executive Director denied that he had failed genuinely to attempt to make the proposed decision on its merits at material times. The Executive Director also denied that the error, as to distance between the two leases referred to in ground 3, which it admitted, was material.

39 The Executive Director called both Dr Jones, the Department's Senior Fish Pathologist, and Mr Westaway, who was at material times a Fisheries officer, to give evidence concerning grounds 3 and 4.

40 The applicant's contention was that, if one had regard to the policies and other documentation of the Department at material times, it could be seen not only that the Executive Director had relied on wrong information concerning the distance between the aboriginal corporation's lease and the applicant's lease, but also that the proposed decision had been proposed effectively as a result of bad faith, or at least poor administrative practice, on the part of the Departmental officers.

41 As to the question of distance between the two leases, the Executive Director at the time the proposed decision was published, believed the distance between the two leases was 2.75 nm. As it transpires, the distance was, in fact, 2.48 nm.

42 Dr John Brian Jones of Fisheries Western Australia, Senior Fish Pathologist, gave evidence concerning the distance issue. He received from Mr Westaway a copy of the proposed decision for comment before it was published. He saw no difficulties with it. That proposed decision suggested that the distance between the two leases was 2.75 nm. Dr Jones said that, even if he had been told the distance was 2.48 nm at that time, it would have made no difference to his opinion. He said that the difference in distance was scientifically immaterial in the context of this case. I accept that this is so.

43 Dr Jones was also pressed in cross-examination by Mr McGowan as to why Dr Jones should have effectively approved the proposed decision in light of the fact that Fisheries had a 5 nm policy concerning the distance between leases. In this regard Dr Jones did not accept that there was a "policy" to that effect in respect of non-maxima pearl farms.

44 Mr McGowan then took Dr Jones to advice Dr Jones had given the Executive Director on 13 February 1998 and again in writing dated 8 May 1998, in which he recommended that the "maxima policy be adopted for determining the distance between non maxima sites and between maxima and non-maxima sites". Dr Jones confirmed his view that, as of May 1998, he believed the policy should be the same for both sites. At that time, a formal policy stated that a 5 nm distance between maxima sites was appropriate. He said, however, that there was some debate about whether or not that policy was appropriate in respect of non-maxima sites but that no policy had in fact been set for non-maxima sites.

45 Mr McGowan drew Dr Jones' attention to the fact that at that time the non-maxima pearl farming industry was agitating for the maxima policy to be the same in respect of both sites. Dr Jones seemed to accept this was so. However, Dr Jones emphasised that, at the time he considered the draft proposed decision, there still was no formal policy of Fisheries by which the distance between non-maxima sites was the same as that laid down for maxima sites. In his view, there was nothing to prevent Fisheries from approving a non-maxima lease which was less than 5 nm from another non-maxima lease. Indeed, he considered that because there was no formal "policy" then adopted by Fisheries, it would have been inappropriate for the Executive Director to have refused an application for a non-maxima lease - or in this case an application for a variation for an existing non-maxima lease - just because it was within 5 nm of another non-maxima lease.

46 In all the circumstances, even though the evidence before me suggests that there was a real desire on the part of the non-maxima pearl farming industry to establish a distance policy that was the same as the maxima distance policy, at material times there was no relevant formal policy in place to this effect, and it was within the discretion of the Executive Director to make a decision allowing the variation of a lease for a non-maxima site within 5 nm of another non- maxima site. Whether or not Dr Jones' understanding as to the inability of the Executive Director to refuse an application for a non-maxima site that was less than 5 nm of another non maxima site is correct or not, is not to the point. There was a reasonable basis for Dr Jones' belief and it cannot be said that his view was arbitrarily formed in the circumstances of this case.

47 It follows, in my view, that the fact that the Executive Director was prepared to grant a lease in respect of a non-maxima site within 5 nm of another non-maxima site was not something beyond his discretion at material times.

48 The fact that an administrative error was initially made in estimating the distance between the relevant sites at 2.75 nm instead of 2.48 nm, also does not bear on the question, given the evidence of Dr Jones that I have accepted, that the difference in the distances would not have made any difference to his view of the appropriateness of the proposed decision.

49 There is also no persuasive evidence before me to suggest that Dr Jones formed his views about the appropriateness of the proposed decision as a result of any undue influence, duress, pressure or coercion applied to him by Mr Westaway, who at material times, was a more junior policy officer within Fisheries.

50 It follows that ground 3 is not made out.

51 As to ground 4, the applicant considers that the Executive Director, in effect discriminated against the applicant by favouring the aboriginal corporation's lease and failing to assess the aboriginal corporation's application according to the Department's usual criteria.

52 On the evidence before the Tribunal given by Dr Jones and Mr Westaway, who were called to give evidence by the respondent, this ground cannot be made out. Mr Westaway explained that he made a careful assessment of the aboriginal corporation's application for variation of its existing lease. He indicated he had great respect for the applicant's non- maxima farming activities. He also considered the aboriginal corporation was an applicant that had an appropriate involvement in the fishing industry and was also entitled to due respect in the application consideration process.

53 Both Mr McGowan and Mr Westaway acknowledged that at material times there was great interest in the black pearl farming industry in Western Australia and that there were a number of "speculators" in the industry. Mr Westaway did not consider that either the applicant or the aboriginal corporation were "speculators".

54 Mr Westaway confirmed his view that, on its merits, the aboriginal corporation's application was worthy of support by the proposed decision, notwithstanding that the distance between the aboriginal corporation's lease, if varied, and the applicant's lease would be separated by approximately half the 5 nm rule that applied in the case of maxima leases at material times.

55 On the evidence before the Tribunal there is no basis to find that the Executive Director, through his relevant Departmental officers, discriminated against the applicant, either directly or indirectly, by unfairly favouring the aboriginal corporation and its application for variation to its existing lease.

56 In those circumstances ground 4 is not made out.

57 It follows from these reasons that the applicant's claim that the Executive Director should pay its costs in relation to this application has not been made out and that the usual rule in review jurisdiction proceedings, that each party should bear its own costs, should prevail on this occasion.

58 Accordingly, there will be orders that:

(1) The application and objection proceedings in the State Administrative Tribunal that were transferred from the Fisheries Objections Tribunal are at an end and are dismissed.

(2) Each party to the proceedings pay its own costs.

I certify that this and the preceding [58] paragraphs comprise the reasons for decision of the State Administrative Tribunal.

___________________________________

JUSTICE M L BARKER, PRESIDENT