Simeon v Minister for Finance and Deregulation

Federal Court of Australia|2012-03-28|Before: Mr J, Edmonds J

REASONS FOR JUDGMENT 1 By these applications, which are in relevantly identical terms, each of the applicants, Messrs Michael Simeon (No. NSD 717 of 2010) and John Henry Griffiths (No. NSD 733 of 2010), seek judicial review pursuant to s 5 of the Administrative Decisions (Judicial Review) Act 1977 (Cth) ("ADJR Act") of decisions made by the respondent, in each case dated 25 May 2010, refusing to make "act of grace" payments to them. Relevantly, the act of grace payments were sought to compensate the applicants for forensic evidence delivered from drug testing services supplied by the Commonwealth to the New South Wales Police Force, which led to their conviction and imprisonment.

Background 2 These proceedings arose out of the conviction of the applicants, which were subsequently overturned on appeal, on drug charges brought against them relating to them allegedly being knowingly concerned in the manufacture of a prohibited drug known as methcathinone. The factual background which was largely uncontroversial was set out in the respondent's chronology, which was cross-referenced to an exhibit, marked Exhibit "FXL-1", to an affidavit of Ms Fleur Lamb, an officer of the Department of Finance and Deregulation, affirmed 29 June 2011 (Ex A). 3 The convictions, subsequently overturned, depended upon a scientific analysis of the substance alleged to have been methcathinone, conducted by a Mr Peter Ballard, an authorised analyst employed in the Australian Forensic Drug Laboratory ("AFDL") of the Australian Government Analytical Laboratories ("AGAL"). Mr Ballard issued certificates determining that the powder contained methcathinone. 4 The appeals against conviction were upheld on the basis that the convictions were unsafe, because the jury should have had serious doubts about the correctness of Mr Ballard's opinion.

Relevant Statutory Regime 5 Under the Financial Management and Accountability Act 1997 (Cth) ("FMA Act") provision is made under s 33 for the approval of act of grace payments. In particular s 33(1) provides: "If the Finance Minister considers it appropriate to do so because of special circumstances, he or she may authorise the making of any of the following payments to a person (even though the payment or payments would not otherwise be authorised by law or required to meet a legal liability): (a) one or more payments of an amount or amounts specified in the authorisation (or worked out in accordance with the authorisation): (b) periodical payments for an amount specified in the authorisation (or worked out in accordance with the authorisation), during a period specified in the authorisation (or worked out in accordance with the authorisation)." 6 In Toomer v Slipper [2001] FCA 981, Weinberg J said at [31]-[32], [47]: "[31] The statutory context in which the term 'special circumstances' arises in the present case is one in which the Minister is given a discretion to authorise the making of act of grace payments where such payments 'would not otherwise be authorised by law or required to meet a legal liability'. There are any number of circumstances which may give rise to a claim for a payment of this type. It is impossible to anticipate the situations in which such payments may be warranted. The discretion vested in the Minister is obviously broad. [32] The respondent said in the letter of denial that the power to approve act of grace payments under the FMA Act was only to be exercised where it was considered that the application of Commonwealth legislation had produced unintended, anomalous, or inequitable results, or where because of its direct role in a particular situation the Commonwealth considered that it had a moral responsibility to redress the circumstances of the individual concerned ... There is nothing in the formulation of 'special circumstances' adopted by the respondent which strikes me as being too narrow, or otherwise erroneous in law. … [47] The legislature has entrusted the power to make act of grace payments to the Minister. Such payments are not based upon any legal entitlement but are made in response to moral obligations assumed by the Commonwealth as a result of the actions of its employees or instrumentalities. The power to make such payments is, by its very nature, one which is particularly suited to be exercised by the Minister. The role of the Court is to ensure that the Minister exercises that power lawfully. Provided he does so, his decision cannot be impugned." 7 These comments were recently cited with approval in Croker v Minster for Finance and Deregulation [2011] FCA 1188 at [18] per Robertson J.

Decisions 8 The relevant decisions were made on 25 May 2010 and were followed by statements of reasons furnished under s 13 of the ADJR Act (Ex FXL-1 at Tabs 50, 51 and 52). The Minister said at [7] of each statement of reasons: "While I noted the comments made by the Court of Criminal Appeal in relation to the AGAL chemist in relation to his testing of samples and reporting of results, I was not satisfied that the AGAL testing for Methcathinone, in the circumstances of the time, and the reporting of results constituted special circumstances that would give rise to an act of grace payment."

Grounds of review and Analysis 9 The applicant in each matter advanced 13 identical grounds of review. Neither applicant filed written submissions. Instead, on the scheduled date for service of submissions, the applicants served a further two volumes of evidentiary material, much of which was not before the Minister. 10 As will be apparent from the reasons which follow, I am in substantial agreement with the submissions advanced, on behalf of the Minister, at the hearing.

Ground 1 - Denial of natural justice 11 The Court has previously accepted that the rules of natural justice apply to an act of grace payment claim under s 33 of the FMA Act: see G & M Nicholas Pty Ltd v Minister for Finance and Deregulation (2009) 174 FCR 471 at 479 per Cowdroy J. 12 Here, the alleged denial of natural justice was the failure to provide each of the applicants with a "full copy of the testing by the University of New South Wales". The applicants contended that by this failure, they were unable to comment upon the report in full. 13 The copy of the University of New South Wales ("UNSW") report held by the Minister's Department was only an extract of the full report. The extract from the Department's files dated 5 August 2002 was exhibited at Tab 3 of Ex FXL-l. 14 Copies of that extract were provided to the applicants' then solicitors on 3 April 2009 (Ex FXL-1 at Tab 23 and Tabs A and F). 15 A further copy was sent on 9 April 2009 to the applicants then solicitors (Ex FXL-1 at Tab 24). 16 The Ministerial brief that went to the Minister on 23 February 2010 only included this limited extract (Ex FXL-1, at Tab 45 and Tab F). 17 At no time did the applicants either ask for a full copy of the report or seek to have the full report put before the Minister. The applicants did not lead any evidence as to how the provision of the full report would have led them to act differently. 18 Therefore: (a) the only material the Minister's Department held was the extract; (b) that extract was provided to the applicants, through their solicitors, twice; and (c) it was only that extract that was considered by the Minister in making his decision in relation to the application for an act of grace payment. 19 In those circumstances, there was no denial of procedural fairness.

Grounds 2 & 3 - Failure to take into account relevant material 20 The applicants contended that the Minister failed to take into account "the circumstances in which the test by the University of New South Wales came into existence", and the "conflict of interest in which Peter Ballard was placed by preparing the samples and the standard for the alleged independent testing by the UNSW when it was his own tests that were being checked". 21 The evidence before the Minister was that analysis by UNSW found that the samples contained spectra consistent with methcathinone as the major component (Ex FXL-l, at Tab 45, Tab A, page 3, para 4, and Tab D6, page 10, para 2). The UNSW report simply said that "Australian Forensic Drug Laboratories (AFDL), of AGAL, NSW, submitted sixteen samples - of crystalline material…together with authentic samples of caffeine and methcathinone". 22 There is no evidence that the matters which the Minister is alleged to have failed to take into account were placed before the Minister. Equally, there is no reason to think a failure to take these matters into account would be reviewable error.

Ground 4 - Too much weight attributed to the UNSW report/test result 23 The applicants contended that the Minister attributed too much weight to the UNSW report/test result. 24 Ultimately, the discretion under s 33 of the FMA Act is to be exercised having regard to whether there are special circumstances. Although there are policy guidelines (Finance Circular No. 2009/09, replacement and update to Finance Circular No. 2006/05) that provide guidance in assessing applications for act of grace payments, the weight to be attributed to evidence, such as the UNSW report, was ultimately a matter for the Minister. In each case, a finding made based on the UNSW report was one of a number of factors referred to by the Minister (Ex FXL-1 at Tab 51, para 4(vii), and Tab 52, para 4(vii)). There was nothing that would justify the Court concluding that there was reviewable error because the weight attributed to the UNSW report was more than any decision-maker could justifiably attribute to it.

Ground 5 - Failure to attribute sufficient weight to the report of Dr Kibby 25 The applicants alleged that the Minister failed to attribute sufficient weight to the "report" of Dr Kibby. 26 Dr Kibby was called by the applicants at their criminal trial. He is described in the Department of Innovation, Industry, Science and Research's submission (Ex FXL-l, Tab 23, page 4) as "an analytical chemist of considerable experience and expert witness for the defence". 27 Whilst in his email to the Minister's Department Mr Pigott (another criminal co-defendant of the applicants in these proceedings, who also pursued an act of grace claim, but is not party to these proceedings) refers to a desire to fax "Kibby's report" (Ex FXL-l, Tab 29), there was no evidence that the report was ever sent to the Department. 28 Further, in a letter of 21 February 2010 to the Department (Ex FXL-l, Tab 44. page 3), Mr Piggott made the statement that "I have previously supplied your office with Dr Kibby's handwritten report about Ballard's evidence"; however, there does not appear to be any record of this having in fact occurred. Enclosed with this letter were extracts of pages 2897 to 2933 and 4205 to 4260 of the criminal trial transcript, including evidence from Dr Kibby. That in turn was provided to the Minister (Ex FXL-1, Tab 45 and Tab B2) and there was no reason to think that the Minister did not consider it (see para 3(vi) of each decision record (Ex FXL-l, Tabs 51 and 52). He referred to this evidence in his findings of fact (see para 4(iii) of each decision). The weight to be accorded to that evidence was a matter for the Minister and no reviewable error was demonstrated on the evidence before the Court.

Ground 6 - Failure to attribute sufficient weight to the evidence of Mr Ballard as to the widening of the window on the gas chromatogram 29 The Minister was plainly aware of and took into account the difficulties of proof in the criminal case present by Mr Ballard's evidence. His decision record in each case at paras 4(i), (ii), (v) and 7 (Ex FXL-l, Tabs 51 and 52) makes it plain that he took into account these factors, and the weight to be given to aspects of the evidence was a matter for him.

Ground 7 - Failure to take into account alleged District Court order 30 It was alleged that the Minister failed to take into account the fact that the District Court ordered the destruction of the material alleged to contain methcathinone that was the subject of the criminal proceedings against the applicants. It was therefore said that any testing by UNSW could only have taken place in defiance of that order and should not have been considered on public policy grounds. 31 The applicants did not prove that any such order was made by the District Court, let alone the terms of any such order, or its date. There was equally no proof that the Minister was made aware of any such order, if one in fact existed, such that a failure to take into account the order might have amounted to reviewable error.

Ground 8 - Took into account the irrelevant fact that methcathinone had not been previously tested by AGAL 32 The Minister found this as a fact (para 4(viii), Ex FXL-l, Tabs 51 and 52) and plainly took it into account. He was entitled to do so. The applicants did not demonstrate any reason why the Minister was not permitted to take this matter into account.

Ground 9-Attributed too much weight to the late acquisition of the standard 33 The applicants complained about the perceived weight attributed to the late acquisition of the testing standard (para 4(viii), Ex FXL-1, Tabs 51 and 52). The weight to be attributed to this was a matter for the Minister.

Ground 10- Failure to take into account or sufficiently take into account concessions by Mr Ballard 34 This ground is effectively answered by the same matters addressed in respect of ground 6 above.

Ground 11 - Failure to take into account or sufficiently take into account the weight of evidence against the assertion that the tested material was methcathinone 35 The material which the applicants relied upon at their criminal trial, so far as it was advanced to the Minister, only cast doubt on whether the Crown had proven the powdery substance in issue was in fact methcathinone. They did not seek to positively prove that it was not methcathinone. The weighing of the evidence, such as it was, was a matter for the Minister.

Ground 12 - Irrelevantly took into account the standard of proof in the criminal litigation and did not weigh up the evidence in a balanced or considered way; nor has the Minister considered and applied any onus or standard of proof in his considerations 36 This is presumably a reference to the Minister's finding of fact at para 4(v) of the decision record (Ex FXL-1, Tabs 51 and 52). There was nothing irrelevant or impermissible in taking that matter into account. 37 To the extent that the ground complains that the Minister did not consider or apply a standard of proof, he was not required to do so. The Minister is given a discretionary power by s 33 of the FMA Act. It is up to him to form a view on the evidence before him. To apply a standard of proof would have itself been erroneous.

Ground 13 - Irrelevantly given weight or too much weight to the fact that the applicants' arrest, imprisonment and conviction was pursuant to New South Wales law 38 It is not clear on the face of the reasons that this was a factor given any weight by the Minister. Even if it were, there was nothing impermissible in the Minister having regard to it.

Orders 39 None of the grounds of review alleged are made out. Both proceedings must be dismissed. I certify that the preceding thirty-nine (39) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Edmonds.

Financial Management and Accountability Act 1997(Cth)s 33

Under the Financial Management and Accountability Act 1997(Cth)

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