Fact-finding errors and procedural fairness

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This article is a topic within the subject Administrative Law.

Contents

Required Reading

R Creyke & J McMillan, Control of Government Action: Text, Cases and Commentary, 3rd ed, 2012, [12.3.1-2], [12.3.4], [7.5.1-3]; [10.1.1-16C]; [10.2.1-14],[10.2.15C], [10.2.16C], [10.2.19C], [10.3.1-5].

Fact-finding errors

[1]The law/fact distinction permeates judicial review as a result of “error of law” being a ground of judicial review. Nevertheless, there are many ways in which fact-finding errors are judicially reviewable. For example, GTE[2] held that an error of fact can be so serious that it can constitute a jurisdictional error. The following grounds have been applied at times to fact-finding errors:

- Breach of natural justice
- Decision not authorised by the enactment pursuant to which it was purportedly made
- Failing to take a relevant consideration into account
- Reliance by a decision-maker on a non-existent fact
- Wednesbury unreasonableness
- Failing to base a decision on logically probative evidence
- Failing to satisfy a jurisdictional fact
- Jurisdictional error

Procedural fairness

[3]Originally dubbed ‘the obligation to act judicially’, then renamed ‘natural justice’, the preferred term for this principle is now procedural fairness. Breach of this ground of judicial review can lead to invalidity of executive action and, as repeated affirmed by the High Court, a breach by an officer of the Commonwealth warrants the grant of a constitutional remedy under s 75(v) of the Constitution.

Natural justice is enshrined as a ground of review in s 5(1)(a) of the ADJR Act.

The essence of natural justice is that it stipulates standards of fair procedure to be observed in administrative decision-making. Two traditional elements are:

  • The prior hearing rule
  • The bias rule

Two other suggested elements, which have not been authoritatively endorsed by the High Court, are:

  • The probative evidence rule – there is a close connection between the obligation of a decision-maker to be procedurally fair and to make findings based on evidence that is neither arbitrary nor irrational.
  • The 'duty of inquiry – in very limited circumstances there can be a duty on a decision-maker to initiate an inquiry to obtain additional information to clarify gaps or discrepancies in the information at hand.
Application to administrative decisions

Since Ridge v Baldwin[4] held that the duty to accord natural justice could be implied from the existence of a power to affect the rights of a person, the duty to accord natural justice has been applied to a diversity of government decisions.

  • Miah[5] held that the common law rules of natural justice are taken to apply to an exercise of public power unless expressly excluded.
  • It can be excluded provided it is done so clearly e.g. Migration Act.
  • Jarratt[6] held that the obligation to accord natural justice extends beyond decisions made under statute, to exercises of common law prerogative power.
  • Natural justice attaches to exercises of public power, not private e.g. contract.
  • Procedural fairness is not concerned with fairness of outcome (substantive fairness), only of ‘process’ i.e. a fair hearing.

When natural justice applies

[7]

a) The implication question: is there an implied (or express duty) to accord natural justice?
b) The exclusion question: has the legislature clearly excluded duty or one or other requirements?
c) The content question: what kind hearing is required?

There is a strong presumption that natural justice applies to the exercise of judicial power by a court or any body created with the trappings of a court (tribunals such as the AAT). Justice Megarry made the point in John v Rees,[8] that there is no way of knowing that information is useless until it is heard, even when “the result [seems to be] obvious from the start...” He noted that a hearing can also serve to help a party accept a decision against them.

Cooper v Wandsworth Board of Works [9]

Facts: Wandsworth Council tore down a building Cooper had constructed on his land without planning approval. It was acting under statute but gave Cooper no notice of the demolition. Cooper brought a tort action of trespass.
Issue: Specific right affected gives rise to obligation to accord natural justice.
Held: Because the decision infringed upon property rights, Cooper had an implied right to be heard before the house was torn down.

Ridge v Baldwin[10]

Facts: Ridge was dismissed from the police force on the basis of corruption allegations, without an opportunity to speak in his own defence.
Issue: Obligations and interests can give rise to an obligation to accord natural justice.
Held: The House of Lords held by majority that the dismissal was void, as Mr Ridge had not been given prior notice of the grounds on which the committee proposed to act or an opportunity to be heard in his own defence. Employment is usually governed by private law (except police and military which are appointed by executive), therefore the decision was under public law.
  • Natural justice should be implied in all decisions of a public nature unless excluded.
  • Ridge did not have a right that came into issue when he was sacked (he didn’t have a right to employment) but the court recognised that there are important things that are worth protecting, which do not have a right attached to them.
  • Obligations/interests were added to the rights ground.

The Hearing Rule – general tests

[11]Even when legislation spells out a hearing procedure, it is common for the courts to conclude that natural justice requires additional steps to be taken. Four different theories explain the approaches taken by courts:

- Natural justice is a common law implication
- Brennan view that it should be implied from legislation
- Universal implication presumes that a hearing is owed unless exempted
- Natural justice is an implication derived from multiple factors

Common law implication The approach of the courts in Cooper and Ridge was that the common law supplies the omission of the legislature. The exercise of power to affect rights triggers the intervention of the common law.

Legislative implication Justice Brennan took the approach in Kioa, that “there is no right to be accorded natural justice which exists independently of statute.”[12] There is little support for this theory.

Universal implication The idea that natural justice should presumptively apply to administrative decisions which affects rights, interests and legitimate expectations, unless excluded, has increasingly support on both practical and doctrinal grounds. Exceptions:

- Decisions made by cabinet
- Decisions of a subordinate legislative character
- Some types of ‘policy’ and planning decisions which impact on individuals to the extent only that they are members of a relevant class of people
- Decisions upon applications such as entry to tertiary institutions, employment and licences

Implication from multiple factors Viewed this way, the question of whether natural justice applies becomes a process of balancing various factors, though some presumptively carry more weight than others e.g. legislation. The factors discussed by McHugh J in Miah can be summarised as follows:

  • Whether the original decision is preliminary or final – natural justice is less likely to apply to preliminary decisions
  • Whether the original is made in public or private – natural justice is more likely to apply to decisions made in a public hearing, where a person’s reputation may be at risk of being damaged.
  • Whether the original decision-maker must comply with formalities – the right of appeal may exclude natural justice
  • Whether the decision is of an urgent nature – which might exclude or limit natural justice
  • Whether the appellate body is judicial, internal or domestic – where the appellate body is a court, it is more likely that the right of appeal is intended to limit or exclude the need for the original decision-maker to comply with natural justice requirements
  • Whether the breadth of the appeal is limited or is to be heard de novo – if there is a de novo appeal on the merits of the case, it is more likely that the original decision-maker does not need to comply with nature justice
  • Whether the nature of the interest, consequences for the individual and subject matter of the litigation suggest that the original decision-maker would need to comply with procedural fairness requirements

Kioa[13]

Facts: The decision to deport Mr Kioa and his family after their temporary visas had expired was made on the grounds of him changing his address without notifying the department and his involvement with other Tongan illegal immigrants. Mr Kioa was given an opportunity to make a submission but was not informed of these adverse factors and therefore not given an opportunity to comment on them.
Issue: Entitlement to know the case against you.
Held: Procedural fairness requires an opportunity to respond to the case against you and particularly, to be informed of specific “credible, relevant or significant” adverse factors which the decision may be based upon.

FAI Insurances Ltd v Winneke[14]

Facts: Sir Henry Winneke was the governor of Victoria. His agent decided to refuse a licence to FAI on the ground that they did not have sufficient funds to support insurance claims. FAI’s licence had been renewed for 20 years previous to the decision.
Issue: Stronger presumption of an obligation to accord natural justice when the decision relates to an ongoing (commercial) activity rather than an initial decision.
Held: They were owed procedural fairness because non-renewal had serious commercial repercussions for FAI. If a power is “at large” (or an absolute discretion), it will be less likely to attract the requirements of procedural fairness. Following Plaintiff M61, it is clear that the procedural fairness should still be applied once the process of making decision is initiated, there is simply no requirement to exercise the discretion in the first place.

Plaintiff M61[15]

Facts: The minister was not required to make a decision under s 46(a) as it was completely in his discretion to do so but ordering the contractors to begin the process was essentially a promise to the people on Christmas Island that their applications would be considered.
Issue: discretionary decisions and powers “at large”.
Held: The Minister’s decision to refuse visas was invalid because of the wrong guidelines given to the contractors (he delegated so it’s still his legal mistake). The minister is not required to exercise personal discretionary powers (Kaur) but once he does, they will be subject to procedural fairness.

The Hearing Rule: the right or interest affected by a decision

[16] Many cases distinguish between decisions that affect people in their individual capacity (to which natural justice presumptively applies) and those that affect people indirectly as members of the community. Another distinction is between the rejection of an application or denial of hope or advantage and the cancellation or refusal to renew an existing entitlement. Natural justice generally applies to the latter but not to the former.

  • Per Mason J in Kioa: “right or interest must be understood as relating to personal liberty, status, preservation of livelihood and reputation, as well as to proprietary rights and interests.”
  • Per Brennan J in Kioa: is “a power apt to affect the interest of an individual in a way that is substantially different from the way in which it is apt to affect the interests of the public at large”?
  • The Annetts[17] case gave a family the right to be heard by Coroner’s inquiry because of their interest in the reputation of their deceased son.
  • In Ainsworth,[18] business reputation was the relevant interest.

Even a fundamental right (such as personal liberty or property) can in special circumstance be taken away without a hearing e.g. in O’Shea,[19] the court held that the Governor did not have to provide a hearing before rejecting a recommendation from a parole board that a person be released from detention.


End

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References

Textbook refers to R Creyke & J McMillan, Control of Government Action: Text, Cases and Commentary, 3rd ed, 2012.

  1. Textbook, pp 757-60 & 374-5.
  2. GTE (Australia) Pty Ltd v Brown (1986) 14 FCR 309.
  3. Textbook, pp 559-63.
  4. [1964] AC 40.
  5. Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR at 93.
  6. Jarratt v Commissioner of Police (NSW) (2005) 224 CLR 44.
  7. Textbook, pp 563-7.
  8. [1969] 2 All ER 274.
  9. (1863) 143 ER 414.
  10. [1964] AC 40.
  11. Textbook, pp 569-75.
  12. Kioa v West (1985) 159 CLR 550.
  13. Kioa v West (1985) 159 CLR 550.
  14. (1982) 151 CLR 342.
  15. Plaintiff M61/2010E v Commonwealth (2010) 123 ALD 244.
  16. Textbook, pp 596-9.
  17. Annetts v McCann (1990) 170 CLR 596.
  18. Ainsworth v Criminal Justice Commission (1992) 175 CLR 564.
  19. South Australia v O’Shea (1987) 163 CLR 378.
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