ADMINISTRATIVE LAW

NOTES

Privative Clauses

Introduction

A ‘privative clause’ is a provision in legislation that purports to exclude or limit judicial review of decisions made under that legislation.

Examples include clauses which:

confer wide discretionary powers on the decision-maker

restrict the kinds of inquiry a court can engage in

preventing remedies being granted by the courts

restrict the grounds for review

impose time limits on when an application for review can be sought

oust the judiciary’s ability to review decisions in a particular jurisdiction.

A privative clause is thus a provision within an Act that restricts the scope of judicial review for decisions made pursuant to the Act. Privative clauses achieve their effect through a variety of methods and to differing degrees. Having as their object the limitation of courts’ jurisdiction, privative clauses throw into sharp relief questions about the purpose of judicial review. Judicial review’s purpose, from a traditional perspective, is to ensure that those upon whom Parliament has conferred power to act according to and not beyond that power.

From this perspective, the courts, in assessing whether the administrative agency has acted ultra vires, ask whether the intention of the legislature has been adhered to. Paul Craig has pointed out that the traditional concept of judicial review sits uncomfortably with the courts’ history of reading down privative clauses: rather than, he said, the courts applying the legislative intent explicit in the language of the provision, they read certain ‘judicially developed principles’ into the legislation.

However, he further argues, the traditional mode does not acknowledge this activity, but rather assumes the judiciary is complying with ‘implied’ legislative intent. In Australia, as we shall see, R v Hickman; Ex Parte Fox and Clinton (1945) 70 CLR 598, remains the authority regarding the interpretation of privative clauses. This judgement has been repeatedly applied by the High Court, and, as will be discussed, its language informed the drafting of the migration privative clause. The Hickman decision and subsequent cases will therefore warrant some attention.

In Australia, privative clauses date back to 1904, when the Commonwealth attempted to virtually eliminate the High Court’s jurisdiction to review decisions of the then Arbitration Court – R v Commonwealth Court of Conciliation and Arbitration; Ex Parte Whybrow & Co (1910) 11 CLR 1. The High Court unequivocally stated that the privative clause had no effect on its entrenched Constitutional jurisdiction to review administrative decisions.

The difficulty presented by privative clauses is that they are primarily based on an apparent contradiction. Parliament enacts a law establishing legal rights within which a decision-maker is empowered to make a decision. If a privative clause is made applicable to that decision, there is very little scope for a court to determine whether these legal limits have been respected by the decision-maker.

Privative clauses take different forms, though there are certain commonly occurring formulations. The number of cases in which a privative clause has been found not to protect a particular decision-making process is very large. The cases are not necessarily reconcilable. Nevertheless, certain broad themes emerge. Perhaps the most important factor is the application of the well-known principle of the law of statutory interpretation that Parliament is presumed not to intend to reduce the jurisdiction of a court save to the extent that the legislation expressly so states or necessarily implies.

This is a specific application of a more general principle that Parliament did not intend to abrogate fundamental rights or freedoms, of which a citizen's rights of access to the courts is one. This principle and its application has more recently been reaffirmed in the authoritative joint judgment of the High Court in the Plaintiff S157 case.

Privative clauses are, accordingly, construed strictly.

A number of alternative, but equivalent, formulations have been propounded to identify the level of strictness appropriate to the construction of provisions which may have the effect of invading common law rights: "express words of plaint intendment", or "clear and unambiguous words", or "unmistakeable or unambiguous" or "irresistible clearness" or "with a clearness which admits of no doubt" or "clearly manifested by unambiguous language".

General words contained in a statute are frequently read down in accordance with longstanding principles of statutory interpretation.

No parliamentary drafter can be in any doubt that this approach will be applied to a privative clause. Subject to constitutional limitations, the drafter can maximise the efficacy of a provision, but only by words of 'irresistible clarity'.

In view of the longevity of the principle of strict construction of privative clauses, the Courts are entitled to proceed on the basis that legislation has been drafted on the assumption that that will occur.

A privative clause generally consists of two component parts.

The first identifies the decision or event to which the relevant restriction applies, e.g. in a frequently appearing formulation "a decision under this Act".

The second is the specification of the restriction upon a court which may otherwise have supervisory jurisdiction, e.g. language of 'finality', "no appeal", no "certiorari or quashing" and no "calling into question".

A strict construction applies to each of these two distinct aspects of a privative clause. Of particular significance for present purposes is the first, i.e. the identification of the decision or event which triggers the application of the restriction found in the second part of the clause. The High Court decision in Plaintiff S157 turned on this factor. We will examine it in detail later.

A Brief History

It is desirable first to put the problems raised by privative clauses in their context. The problems raised by privative clauses have been compared to the classical philosophical conundrum of what happens when an "irresistible force" meets an "immovable object"?

The "irresistible force" is the principle of parliamentary supremacy. Parliament has a general, plenary power to make laws "subject to the Constitution" and it is well established that an argument that a particular law is unfair or unjust or wrong or ill-advised is beside the point of whether the law is valid.

The "immovable object" is the principle of the rule of law: by which is meant, in this context, that it is for the courts to have the final word on the interpretation of the law in its application to particular cases.

The role of the courts in judicial review in this sense is constitutionally entrenched by the presence, in s75(v) of the Constitution, of the High Court's original jurisdiction in all matters, "in which a writ of Mandamus or prohibition or an injunction is sought against an officer of the Commonwealth". The High Court has held that this entrenches the Court's power to review decisions by Commonwealth officials and bodies for "jurisdictional error", by granting what it now calls the "constitutional writs" of mandamus and prohibition.

When Parliament invests a particular administrative decision-maker with power to make a decision under a statute and then says, in what is called a "privative clause", that the decision is final and shall not be questioned in the courts, these two principles come into conflict: a "supreme" parliament should be able to pass such a law; but the courts must retain the final word on the legal validity of administrative action. Which principle prevails?

Clearly the courts are not keen to relinquish their inherent power of judicial review.

A literal interpretation of the clauses would mean significant restriction of the courts’ role in deciding how the governmental process will operate.

A narrow interpretation, on the other hand, would allow courts to continue to assert and exercise, in their own right, a power to limit and define the powers of other government agencies. The court’s preferred approach helps to preserve, to some degree, access to the courts by those wanting to challenge administrative decisions, & thus helps to uphold the rule of law.

A literal interpretation of the clauses would suggest that Parliament has decided that the body in question can be trusted not to exceed its

jurisdiction, that it doesn’t need court supervision, and that the Parliament can always correct any problems w/ further legislative intervention.  But that is clearly not a view the courts find attractive.

It is sometimes suggested that the courts' interpretation of privative clauses infringes the notion of parliamentary supremacy. However, provided that interpretation doesn’t lead to absurd results and does leave all words in an Act with some real work to do, the practice of taking a narrow approach is legitimate & consistent with the rule of law & separation of powers principles. Hickman

In what some commentators have seen as an innovative but expedient compromise, the High Court appeared to reconcile these conflicting principles in the 1945 case of R v Hickman, ex parte Fox and Clinton ("Hickman").

In that case, the National Security (Coal Mining Industry Employment) Regulations 1941 (Cth) conferred on Local Reference Boards the power to settle disputes between employers and employees "in the coal mining industry". Regulation 17 contained a classic privative clause - decisions of the Local Reference Boards were:

“... not to be challenged, appealed against, quashed or called into question, or subject to prohibition, mandamus or injunction, in any court on any account whatever.”

Mr and Mrs Fox were general haulage contractors who sometimes carried coal. They sought a writ of prohibition to prevent a Local Reference Board from holding a hearing to settle a dispute in which they were involved. In spite of the privative clause, the Court unanimously granted prohibition on the basis that the dispute was not "in the coal mining industry".

In coming to this conclusion, the Court did not find the privative clause invalid, but instead sought to reconcile it with the Local Reference Board's limited grant of dispute resolution power through a process of statutory interpretation. In a statement that came to be described as "classical", Dixon J (as he then was) set out this interpretive approach:

“The particular regulation is expressed in a manner that has grown familiar. Both under Commonwealth law, and in jurisdictions where there is a unitary constitution, the

interpretation of provisions of the general nature of reg 17 is well established. They are not interpreted as meaning to set at large courts or other judicial bodies to whose decision they relate. Such a clause is interpreted as meaning that no decision which is in fact given by the body concerned shall be invalidated on the ground that it has not conformed to the requirements governing its proceedings or the exercise of its authority, provided always that the decision is a bona fide attempt to exercise its power, that it relates to the subject matter of the legislation, and that it is reasonably capable of reference to the power given to the body.”

The effect of exposition of Dixon J in Hickman's case was to acknowledge the ability of the legislature to ensure a degree of finality in decision-making; but also to assert that the courts retain a measure, albeit a lesser measure, of control over certain types of error in decision-making. Section 75(v) of the constitution demands no less.

That lesser measure of control was expressed in the last (italicised) part of the passage quoted above, which became known as the "Hickman provisos".

Thus a privative clause was seen as a kind of drafting device that, instead of ousting the jurisdiction of the courts, expanded the jurisdiction of the decision-maker to the very limits of its possible scope.

In the years following Hickman's case Dixon J repeated and re-affirmed his analysis in a number of High Court cases dealing with World War II national security regulations, See The King v The Commonwealth Rent Controller; ex parte National Mutual Life Association of Australia Ltd (1947) 75 CLR 361 at 369 (Latham CJ, Dixon J); The King v Central Reference Board; ex Parte Thiess (Repairs) Pty Ltd (1948) 77 CLR 123 at 146 (Dixon J); The King v Murray; ex parte Proctor (1949) 77 CLR 387 at 398; and industrial legislation, See The King v Metal Trades Employers' Association; ex parte Amalgamated Engineering Union, Australian Section (1951) 82 CLR 208 at 249 (Dixon J); The Queen v Australian Stevedoring Industry Board; ex parte Melbourne Stevedoring Co Pty Ltd (1953) 88 CLR 100 at 119 (Dixon CJ, Williams, Webb, Fullagar JJ); Coal Miners' Industrial Union of Workers of Western Australia v Amalgamated Collieries of Western Australia Ltd (1960) 104 CLR 437 at 443, 446 (Dixon CJ).

In time, his doctrine came to be affirmed by other members of the Court, See The Queen v Kelly; ex parte Berman (1953) 89 CLR 608, 630-631

(Kitto J); The Queen v The Members of the Central Sugar Cane Prices Board; ex parte The Maryborough Sugar Factory Ltd (1959) 101 CLR 246 at 255 (Dixon CJ, Kitto and Windeyer JJ); The Queen v Commonwealth Conciliation and Arbitration Commission; ex parte Amalgamated Engineering Union (Australian Section) (1967) 118 CLR 219 at 252-253 (Kitto J); North West County Council v Dunn (1971) 126 CLR 247 at 269 (Walsh J).

Indeed, by 1960, Menzies J, as I have already said, described it as "classical". See Coal Miners' Industrial Union v Amalgamated Collieries of Western Australia Ltd (1960) 104 CLR 437 at 455 (Menzies J).

What is the Hickman principle?

There is sometimes confusion about how many "limbs" of the Hickman principle there actually are. The most common version of the Hickman principle contains only 3 limbs.  A privative clause will successfully oust judicial review only if:

1. The tribunal's decision was a bona fide attempt to exercise its power.

2. The decision relates to the subject matter of the legislation. 3. The decision is reasonably capable of reference to the power

given to the tribunal.

However, some texts (e.g. Aronson & Dyer) add a 4th and 5th limb:

4. The decision does not display a jurisdictional error on its face; 5. The decision is not in breach of a specific statutory limitation on

the tribunal's power which it is reasonable to suppose Parliament intended to be supreme (i.e. the breach is not intended to be protected by operation of the clause). 

This [fourth] "test" was added by Dixon J in cases subsequent to Hickman, including R v Commonwealth Rent Controller; Ex parte National Mutual Life Assoc (1947) 75 CLR 361. Some judges have subsequently doubted whether this fourth 'test' really adds anything to the other three e.g. O'Toole v Charles David Pty Ltd (1991) 171 CLR 232 per Brennan J at 274; per Dawson J at 305.

It may be that the better view is that the fourth test/limb of the "Hickman" principle is now treated by the High Court as not having a separate existence. Certainly, it was not mentioned at all in the judgment of

Gaudron and Gummow JJ in Darling Casino Ltd v NSW Casino Control Authority (1997) 143 ALR 55" 

Limb 5 can clearly be accommodated within limb 3: - a decision which breaches a specific statutory limitation intended by Parliament to be supreme could hardly be regarded as "reasonably capable of reference to the power given ..."  Limb 4, on the other hand, is less obviously able to be encompassed by any of the first 3 grounds.  For present purposes, however, the preferred approach is probably to treat Hickman as consisting of only 3 limbs.

In taking this approach, the inherent contradiction of privative clauses was resolved in that, instead of reading privative clauses at face value as direct limits on the review powers of a court, they are read as indirect grants of authority to a decision-maker.

Rather than construing a privative clause literally so as to exclude judicial review entirely, the clause is construed to allow review on the three given limbs (grounds). This rule of construction is a means of reconciling the contradiction that is presented by provisions of an Act that imposes requirements on the decision-maker with those that purport to exclude the jurisdiction of the courts to review the decision made.

In a way, such a clause operates to expand the jurisdiction of the decision-maker such that, provided there is compliance with the three Hickman requirements: that the decision-maker act bona-fide in the exercise of statutory power so as to produce an outcome that relates to the subject matter of the legislation and that is reasonably capable of reference to the power concerned, then the decision is protected from judicial review.

In his Second Reading speech for the Migration Legislation Amendment (Judicial Review) Act 2001, the then Minister Ruddock indicated that this was his understanding of Hickman:

“Members may well be aware that the effect of a privative clause such as that used in Hickman’s case is to expand the legal validity of the acts done and the decisions made by decision-makers. The result is to give decision-makers wider lawful operation for their decisions…”

"Finality" and "no appeal" clauses

This type of clause typically provides: "A decision of the tribunal shall be final and shall not be subject to appeal in any court". 

Such clauses have always been held to be completely ineffective to exclude any form of judicial review, even the traditional "sacrificial lamb" non-jurisdictional error of law on the face of the record (see e.g. R v Nat Bell Liquors Ltd [1922] 2 AC 128; R v Medical Appeal Tribunal; Ex parte Gilmore 1 QB 575 : 

1. A "decision" does not include a "purported decision" which is a nullity for some judicially reviewable error, and the court can review a purported decision to see whether such an error exists.

2. "Appeal" does not include judicial review: they are different creatures.

The law on such clauses clearly remains as above, despite Hickman, Coldham and Darling Casino.  There is no need for resort to Hickman because there is no collision: the privative clause is effectively interpreted out of existence.

"No certiorari" clauses (and similar)

This type of clause typically provides: "A decision of the tribunal shall not be quashed or called into question in any court whatsoever". 

Unlike the "finality" clause, it cannot be interpreted as having no intention to affect judicial review, because it clearly is so intended. 

The courts have traditionally sidestepped this problem by the traditional method of deeming "no certiorari" clauses to be intended to protect only against non-jurisdictional error of law on the face of the record, leaving jurisdictional error entirely untouched.  Thus there is no collision and no need to resort to Hickman. See e.g. R v Commissioner of Police (NT) v Holroyd (1965) 7 FLR 8. 

Aronson & Dyer seem to regard this as being still the preferred approach for "no certiorari" clauses (despite Darling Casino) because, they assert, non-jurisdictional error of law on the face of the record remains a "viable" review ground at common law. 

But how can a review ground remain "viable" when the High Court has effectively defined it out of existence in Craig?  Continuing to adopt this approach in dealing with "no certiorari" clauses is defiance of the will of

Parliament for exactly the same reason as that applying to broader, more general privative clauses. 

In my view, one must now resort to Hickman when dealing with such clauses: there is a collision which cannot be resolved by ordinary interpretive methods, because the effect of Craig is to leave no remaining viable judicial review ground for the enforcement of jurisdictional limits. 

This view is supported by the fact that the clause in issue in Darling Casino was in essence a "no certiorari" clause, and Gaudron and Gummow JJ proceeded on the apparent assumption that the Hickman test would appropriately have been applied to it had  a judicially reviewable error actually been identified. The privative clause (s 155 of the Casino Control Act 1992 (NSW)) reads:

"(1) Except as otherwise provided in this section, a decision of the Authority under this Act is final and is not subject to appeal or review. 

(2) A person aggrieved by a decision of the Authority to cancel or suspend a casino licence or to amend the conditions of a casino licence may appeal from the decision to the Supreme Court on a question of law. ..."

Bignell v New South Wales Casino Control Authority (2000) 48 NSWLR 462 dealt with the same privative clause with which Darling Casino was concerned. However, the case illustrates the variety of interpretive methods a court can employ to reduce or overcome a privative clause's effect.  It also illustrates the difficulty that even appellate courts are finding in interpreting and applying the Hickman test. 

The majority in the NSW Court of Appeal (Stein and Giles JJA) held that proceedings on a complaint under the Anti-Discrimination Act 1977 (NSW) did not constitute a "review" for the purpose of the privative clause. 

However, the Anti-Discrimination Commissioner had powers which, if exercised, could directly affect the casino licence which the privative clause was clearly designed to protect. If the anti-discrimination proceedings did not therefore amount to a "review" one wonders what!

Sheller JA also held that the privative clause had no effect, but by an even more dubious reasoning process.  His Honour seized on the following somewhat opaquely worded passage from Darling Casino:

"There is one point we should add, because the Court of Appeal appears to have proceeded on a contrary view. It concerns the content of the phrase in s155(1), `a decision of the Authority under this Act'. The phrase is not `under or purporting to be under this Act'. Section 11 obliges the Authority to have regard to certain matters. Section 12 forbids the Authority to grant an application unless satisfied of the matters there specified and for that purpose the Authority is to consider the items specified in s12(2)(a)-(h). Section 13 contains a definition of `close associate', a term used in s12. Sections 11, 12 and 13 are central to the legislative scheme. Section 155 cannot fairly be construed as declaring an intention of the legislature that the Authority is empowered and protected in respect of determinations under s18 reached other than upon satisfaction of the conditions which enliven its power. Those decisions would not have been made `under this Act'." 

Sheller JA held that section 53 of the Casino Control Act 1992 was also (like section 11) a provision requiring the decision-maker to be satisfied of certain matters before granting a licence.  His Honour then reasoned:

"It follows that the Authority was required to make an assessment of the matters listed in s52(3). The appellant alleges that the Authority acted outside these legislative directions and took into account her marital status by treating her less favourably than it would have treated a person of a different marital status in the same or not materially different circumstances. If the appellant makes out that allegation, the Authority's decision was not one protected by s155(1) because it was not a decision "under this Act". The CC Act does not permit the Authority to determine an application by granting or refusing to grant a licence not in conformity with the Act's requirements by perversely discriminating against the applicant on the ground of her marital status."

Such reasoning appears indistinguishable from the ultra vires relevant/irrelevant considerations ground.  If the Hickman test is to be interpreted as permitting review on such grounds, its practical effect in protecting decisions from review as Parliament intended would be minimal. 

All three judges were understandably reluctant to draw a conclusion that Parliament intended to exempt decision-makers under the Casino Control

Act from the Anti-Discrimination Act.  However, both lines of reasoning, no doubt adopted to avoid that conclusion, were flawed. 

A preferable approach would have been to apply the supplementary Hickman principle outlined by Dixon J in R v Commonwealth Rent Controller; Ex parte National Mutual Life Assoc (1947) 75 CLR 361, i.e. that the requirements of the Anti-Discrimination Act  were "specific statutory limitations on the tribunal's power which it was reasonable to suppose Parliament intended to be supreme". 

"Conclusive evidence" clauses

The most commonly litigated provisions of this type are the sections of the Income Tax Assessment Act 1936 (Cth) protecting tax assessment notices from review.  The relevant sections are section 175 and 177, which provide:

"175 The validity of any assessment shall not be affected by reason that any of the provisions of this Act have not been complied with." 

"177(1) The production of a notice of assessment, or of a document under the hand of the Commissioner, a Second Commissioner, or a Deputy Commissioner, purporting to be a copy of a notice of assessment, shall be conclusive evidence of the due making of the assessment and, except in proceedings under Part IVC of the Taxation Administration Act 1953 on a review or appeal relating to the assessment, that the amount and all the particulars of the assessment are correct."

These were the provisions in question in Deputy Commissioner of Taxation v Richard Walter Pty Ltd (1995) 183 CLR 168.  In that case, the majority (Mason CJ, Dawson, Toohey and McHugh JJ) held that neither section was technically a privative clause.

Their combined effect was simply to prevent a litigant from "going behind" an assessment notice in judicial review proceedings and challenging any procedural aspect of the making of the assessment or issue of the notice. 

The sections did not prevent challenges going to the substantive amount of tax that was due by the taxpayer, albeit that such challenges must normally be made via appeal or review proceedings under Part IVC of the Taxation Administration Act (Cth), which provides a full opportunity for challenging the substantive accuracy of a tax assessment. 

Thus (and consistent with the principle previously outlined) there is no occasion for application of the Hickman principle because there is no collision between the jurisdictional provisions and the "privative" clause. 

The majority Justices also explained the distinction by holding that the effect of section 175 in particular was to make the procedural requirements of the Act directory rather than mandatory, so that non-compliance with them would not result in invalidity, and that section 175 established a "substantive rule" which widened the jurisdiction of the decision-maker such that it was not invalidated by procedural defects (this part of the reasoning is analogous to Hickman). 

However, on some of the majority Justices' reasoning (although not Toohey J), a challenge based on lack of bona fides might still be open, because arguably lack of bona fides is not a matter of mere procedure.

The majority reasoning is perhaps best explained by Mason CJ, who said: Section 175 provides that the validity of an assessment "shall not be affected by reason that any of the provisions of this Act have not been complied with". This section does not relieve the Commissioner from performing his duty to make an assessment. The section does not create a valid assessment where none has been made at all.

The section requires an actual assessment as a condition of its operation (F.J. Bloemen Pty. Ltd. v. Federal Commissioner of Taxation (1981) 147 CLR 360 at 371 per Mason and Wilson JJ). But otherwise, the effect of s.175 is that compliance with particular provisions of the Act is not essential to the validity of an assessment.

In Federal Commissioner of Taxation v Dalco ((1990) 168 CLR at 620.), Brennan J (with whom Mason CJ, Deane, Dawson, Gaudron and McHugh JJ agreed) pointed out that, in a case arising under s.167(b), where there are two functions for the Commissioner to perform - first, to decide whether he is satisfied with the return furnished and, second, if not so satisfied, to form a judgment of the amount on which tax ought to be levied, the first function is a procedural step and is part of the due making of the assessment whereas the second function is not.

Accordingly, although the first function is conclusively proved by production of the notice of assessment, in proceedings on appeal against an assessment production of the notice does not conclusively prove the formation of a judgment of the amount on which tax ought to be levied.

The minority, on the other hand (Brennan J, Deane and Gaudron JJ), held that Hickman was applicable (although Deane and Gaudron JJ said it was only applicable to section 175).  There may not, however, be much practical difference between the majority and minority reasoning, in that all Justices held that Richard Walter's challenge failed, and the result of the reasoning of all Justices was that the "privative" provisions are effective to oust review of all procedural errors.  The difference is in whether one uses the Hickman principle to achieve that result.

However, on some versions of the majority reasoning, improper purpose and lack of bona fides (which could hardly be described as mere procedural errors) may also not be available bases for prerogative judicial review (although they certainly would be available on a review or appeal under Part IVC). 

In large part, therefore, Richard Walter is simply an example of the Court adopting a narrow interpretation of a "privative" clause (although the majority denied that it should be so labelled) so as to leave open viable avenues for appeal and judicial review, thus obviating any need for application of Hickman.  Sections 175 and 177 are interpreted as ousting only procedural defects.

However, the reasoning in Richard Walter was somewhat confusing and convoluted.  It has not resulted in any greater clarity in the method of judicial approach, even in tax cases.  Hickman-like challenges to tax assessment notices have become relatively common since Richard Walter (although the majority in that case held that Hickman was not applicable as such).  Invariably they are based effectively on the 1st limb of Hickman, and allege that the assessment was not "bona fide". 

Such challenges have invariably failed i.e. application of Hickman (or analogous principles) has allowed the "privative" provisions to operate as intended and protect the decision from judicial review.  Interestingly, however, a practice seems to have developed of allowing evidence (e.g. correspondence and internal Tax Office memoranda) to be introduced into evidence for the purpose of seeking to establish mala fides.  The Tax Commissioner invariably objects to this course of action, but the evidence is usually allowed. 

Implicitly, therefore, the Federal Court seems to have accepted the majority position in O'Toole v Charles David (discussed later), that the subjective motivations of the decision-maker can be examined for the purpose of determining Hickman "bona fides".  Some recent examples of such challenges include Darrell Lea Chocolate Shops Pty Ltd v

Commissioner of Taxation (1996) 72 FCR 175; Briglia v Federal Commissioner of Taxation 2000 ATC 4247; Kordan Pty Ltd v Commissioner of Taxation [2000] FCA 1807; Dan v Federal Commissioner of Taxation 2000 ATC 4350; and Daihatsu Australia Pty Limited v Commissioner of Taxation [2001] FCA 588.

Another more recent case which demonstrates that one should not automatically assume that every statutory "conclusive evidence" deeming provision will necessarily be regarded as a privative clause whose intention is to oust judicial review (thus requiring application of the Hickman principle) is Shergold v Tanner (2000) 179 ALR 150. Whether a "conclusive evidence" provision will be so regarded must be assessed in its individual statutory context. 

Shergold v Tanner concerned a FOI application for documents held by the Department of Employment, Workplace Relations and Small Business. The application was made by the Labor Shadow Minister Lindsay Tanner.  The Minister issued a conclusive Ministerial Certificate under section 33A of the Freedom of Information Act 1982(Cth). 

The effect of such a certificate is that it "establishes conclusively that the document [to which it relates] (a) is an exempt document referred to in subsection (1); and (b) does not contain matter the disclosure of which under this Act would, on balance, be in the public interest."

Lindsay Tanner sought judicial review before the Full Federal Court (Black CJ, Burchett and Finkelstein JJ) of the decision to refuse access to documents. Review was sought on a variety of ADJR grounds including natural justice, improper purpose and error of law. 

The Minister argued that section 33A of the FOI Act was a similar provision to section 177 of the Income Tax Act and should therefore, on the authority of Richard Walter, be regarded as establishing a "substantive rule", precluding any challenge to the decisions to issue the certificates.  

However, the Court held that section 33A when read in context was intended only to restrict the ambit of merits review by the AAT or Ombudsman, and was not directed at restricting judicial review in any way at all.  Moreover, the ITA/Richard Walter provisions were able to be interpreted as only precluding judicial review of procedural errors, leaving open ample appeal and review avenues unde Part IVC. By comparison, the interpretation for which the Minister was contending in Shergold v Tanner would have precluded judicial review entirely.

"Time limit" clauses

This type of clause typically provides: "The validity of [a decision] shall not be questioned in any legal proceedings except those commenced in the Court by any person within three months of the date of its publication in the Gazette."

This was the clause in question in Vanmeld Pty Ltd v Fairfield City Council (1999) 46 NSWLR 78 - discussed further below.  "Time limit" clauses have traditionally been interpreted either as (1) not being privative clauses at all in the true sense, and therefore simply enforced strictly as they read (e.g. as prohibiting all judicial review after 3 months); or (2) as privative clauses limited in a way which means that resort to Hickman is not needed - there are remaining viable judicial review grounds for the enforcement of jurisdictional limits, as long as they are pursued within 3 months.

However, Darling Casino has somewhat confused the picture, because some judges and commentators read it as requiring presumptively that the Hickman test should be applied to all privative clauses almost irrespective of their particular wording.

Vanmeld illustrates this confusion.  Meagher JA didn't deal with the "time limit" clause, because he held that no judicial review ground could be made out anyway (so there was nothing for a privative clause to exclude).  Powell JA also held to that effect, but mused about the "time limit" clause in obiter anyway.  His Honour suggested that the "time limit" clause would have been effective to exclude review (because the applicant had commenced proceedings outside the 3 month period).  His Honour appeared to base his reasoning on both (1) and (2) above. 

Spigelman CJ in dissent held that there had been a jurisdictional error (namely denial of procedural fairness); that the "time limit" clause was to be regarded as a privative clause; that Darling Casino therefore required one to apply the Hickman test; and that application of the Hickman test led to a conclusion that the privative clause did not protect against a denial of procedural fairness!  Spigelman CJ's reasoning on natural justice and the meaning of the Hickman test will be discussed further below.

Powell JA's approach would appear to be the correct one, and (2) above the preferred reasoning: - a "time limit" clause is a privative clause, but of a type where resort to Hickman is not needed, because there are remaining viable judicial review  grounds for the enforcement of

jurisdictional limits (they just have to be exercised within a specified time).  

Limiting review grounds (as opposed to remedies)

This type of privative clause is one which seeks to restrict the availability of some (or all) judicial review remedies e.g. "shall not be quashed, reviewed, called into question etc". 

At least until Craig, such clauses could easily be sidestepped by the courts, either by holding that they protected only against the particular remedies expressly specified (leaving all others available) or, more commonly, that they only protected against non-jurisdictional error of law on the face of the record, leaving jurisdictional error entirely untouched.

By contrast, the privative clause in Part 8 is much more carefully targeted.  It targets particular judicial review grounds rather than remedies, and only applies to the Federal Court (it cannot affect the High Court by reason of Constitution section 75(v)).  The excluded grounds are essentially almost all the broad ultra vires "abuse of power" grounds as well as natural justice.  Part 8 has (until 31 May - see next paragraph) been effective because it is so specific in its effect. 

It cannot be construed as not affecting a ground when it expressly says that ground is excluded (thus Eshetu held that one could not interpret section 420 as grounding review for procedural fairness when section 476 expressly excluded review on precisely that ground).  Part 8 is also a classical example of a "limited" privative clause: it excludes only some review grounds (albeit the most potent and frequently used ones) leaving several grounds untouched. Thus, resort to Hickman is not needed - there are some remaining viable judicial review grounds for the enforcement of jurisdictional limits, so there is no textual collision to be resolved.

Note, however, that the charmed life of Part 8 as a "bomb-proof" privative clause now seems to be over.  In a case decided more recently, Minister for Immigration and Multicultural Affairs v Yusuf [2001] HCA 30 (31 May 2001), the High Court finally managed to find an intellectually defensible narrow interpretation of section 476 which results in at least some of the more useful judicial review grounds being again available to the Federal Court. 

The Justices had a strong incentive to do so, because the Court's lists were being cluttered with large numbers of mostly unmeritorious

migration cases in its original Constitutional (section 75(v)) jurisdiction.  More enthusiastic students may wish to read this decision.

The anomaly of "as if enacted" clauses

This type of clause is sometimes used to protect subordinate legislation i.e. regulations, instruments, by-laws, general orders etc. Such a clause typically reads: "Regulations (or rules etc) made hereunder shall have effect as if enacted in this Act". An alternative formulation reads: "Regulations (etc) made under this Act shall have the force of law and be conclusively deemed to be valid."

Numerous Australian cases have adopted a somewhat Hickman-like test contained in Foster v Aloni [1951] VLR 481. The test set out in the case provided that an "as if enacted" clause would successfully protect against challenges to the validity of the regulations etc provided that (i) the rules were in fact made by the authorities protected by the clause; (ii) the rules purported to relate to the permissible subject matter as provided for by the parent Act; and (iii) the rules in fact were not patently or absurdly irrelevant to the Act's subject matter. It will be noted that test (i) would almost always be satisfied; there is no equivalent to the Hickman bona fide test (the Hickman first limb); and tests (ii) and (iii) would appear to be very watered-down versions of the correspondingly numbered Hickman tests.

However, some more recent cases have suggested that despite the Foster v Aloni tests, an "as if enacted" clause would not protect an exercise of power which was "plainly invalid" or "wholly beyond power as a matter of substance". See Kwiksnax Mobile Industrial & General Caterers Pty Ltd v Logan City Council [1994] 1 Qd R 291; Paradise Projects Pty Ltd v Gold Coast City Council [1994] 1 Qd R 314.

Such qualifications suggest that the Foster v Aloni tests may be practically indistinguishable from Hickman. Nevertheless, on at least two occasions in the early 1990's State courts have rejected arguments that the Hickman test should be applied instead of Foster v Aloni. However, both cases pre-dated Darling Casino, which arguably states that Hickman should be applied whenever a privative clause would otherwise oust all viable avenues of judicial review (see earlier).  That is certainly what an "as if enacted" clause does, and so it may be that the correct approach since Darling Casino is simply to apply Hickman, and treat Foster v Aloni as superseded.

Further Cases on the Hickman principle

Houssein v Department of Industrial Relations and Technology (1982) 148 CLR 88

The Hickman principle was given mostly lip service in its first 30 years or so of existence.  Judges mused about it but seldom actually applied it, preferring instead the time-honoured method of interpreting most privative clauses as merely ousting non-jurisdictional error of law on the face of the record. 

However, as the consequences of Anisminic (namely a huge widening in the scope of jurisdictional error) came increasingly to penetrate the consciousness of Australian judges, it gradually became apparent that a new approach would be needed. 

Thus,  R v Coldham; Ex parte Australian Workers' Union (1983) 153 CLR 415 is generally seen as reviving Hickman to active use, at both State and federal level, wherever a textual collision between jurisdiction and privative clauses could not be resolved by conventional interpretive means.  Houssein v Under-Secretary Department of Industrial Relations and Technology (1982) 148 CLR 88 is really just a good example of the pre-Coldham "lip service" attitude to Hickman.  The Court mused idly about it, but then proceeded by the conventional approach of interpreting the clause in question as only ousting non-jurisdictional error of law on the face of the record.  However, that was the only sort of error alleged in Houssein, and so the privative clause was effective to oust review.

O'Toole v Charles David - O'Toole v Charles David Pty Ltd (1991) 171 CLR 232

O'Toole is one of the very few cases providing any real illumination of what the 3 Hickman limbs actually mean in a practical sense.

The other aspect of O'Toole that many students appear not to grasp is that it illustrates very clearly the fact that no privative clause, however broad, can be effective to oust either the High Court's original (Constitution section 75(v)) jurisdiction or its equally entrenched jurisdiction to review the constitutionality of a law. 

O'Toole involved a challenge by an employer to the constitutionality of an industrial award (which an employee was trying to enforce against him), on the argument that the award had not been made in settlement of a genuine inter-State industrial dispute.

The Commonwealth Parliament's conciliation and arbitration power in section 51(xxxv) is dependent on the existence of just such a dispute.  Consequently the privative clause in the Conciliation and Arbitration Act (1904) (Cth) had to be read down so as not to oust a person's right to challenge the constitutionality of the law.  As Gaudron and Gummow JJ later put it in Darling Casino:

"The various legislative powers conferred by s 51 of the Constitution are all expressed as being "subject to" the Constitution and thus to the provisions of s 75. Thus, it has been said that a privative clause cannot prevent this Court from reviewing decisions which involve the refusal by officers of the Commonwealth to discharge "imperative duties" or which go beyond "inviolable limitations or restraints".

The terms of s 75(v) would be defeated if a privative clause operated to protect against jurisdictional errors being refusal to exercise jurisdiction, or excess of jurisdiction, in the latter case whether by reason of the constitutional invalidity of the law relied upon or the limited terms of a valid law."

Darling Casino Ltd v NSW Casino Control Authority (1997) 191 CLR 602

Now, briefly some points on Darling Casino Ltd v NSW Casino Control Authority (1997) 191 CLR 602. I have already dealt with it in some respects under earlier headings. I will therefore just make some key points about the case:

It was strictly in obiter, because all Justices including Gaudron and Gummow JJ concluded that there was no breach to protect against in any event.  Moreover, only Gaudron and Gummow JJ dealt with privative clauses and the Hickman principle: Brennan CJ, Dawson and Toohey JJ expressly declined to state a view.

Darling Casino stressed that Hickman is merely a presumptive principle of statutory interpretation, and may be displaced if inapplicable:

It is to be remembered that the Hickman principle is a rule of construction.

Accordingly, the question in Darling Casino is not one of the meaning and effect of the Hickman principle which seeks to reconcile "the prima facie inconsistency between one statutory provision which seems to limit

the powers of the [decision-maker] and another provision, the privative clause, which seems to contemplate that the [decision] shall operate free from any restriction".

Rather, it is one of the meaning and effect of the statutory provisions in question. If there is an inconsistency, the Hickman principle requires that it be "resolved by reading the ... provisions together and giving effect to each".

Nevertheless, the decision has been taken as authority for the proposition that the Hickman test is presumptively to be applied in assessing the effect of most privative clauses, almost irrespective of their wording.  However, I have suggested above that this will only be the case where more conventional interpretive approaches have failed to resolve the textual collision between the jurisdiction clause and the privative clause.  This will occur with very broad privative clauses (e.g. the one in O'Toole) and also with "no certiorari" clauses (for reasons discussed above).  If the collision can be resolved by ordinary interpretive principles then there is no cause for applying Hickman.  

 The effect of applying the Hickman principle is conceptualised as enlarging the jurisdiction of the impugned tribunal rather than reducing the jurisdiction of the court, as explained by Brennan J in Deputy Commissioner of Taxation v Richard Walter Pty Ltd:

"The privative clause treats an impugned act as if it were valid. In so far as the privative clause withdraws jurisdiction to challenge a purported exercise of power by the repository, the validity of acts done by the repository is expanded".

This effectively allows the High Court to defer to the Executive and the Parliament to some extent where they have signalled sufficiently clearly that they don't want courts interfering with particular classes of decision, despite the fact that the Court's judicial review jurisdiction is constitutionally protected.

 At federal level generally (i.e. including review by the Federal Court) there are also certain constraints on the extent to which a privative clause can insulate a decision-maker from judicial review.  The separation of judicial power doctrine means that, if decisions are placed wholly beyond either appeal or review then they could be classed as exercises of judicial power on the Huddart-Parker v Moorehead principles (and therefore

unconstitutional), at least where they make binding determinations of existing rights (as opposed to creating new rights).

 At State and Territory level, Darling Casino asserts that there are no such restrictions:

"The operation of a State privative clause is purely a matter of its proper meaning ascertained in its legislative context. However, privative clauses, whether in State or Commonwealth legislation, are construed "by reference to a presumption that the legislature does not intend to deprive the citizen of access to the courts, other than to the extent expressly stated or necessarily to be implied".

However and provided the intention is clear, a privative clause in a valid State enactment may preclude review for errors of any kind and if it does, the decision in question is entirely beyond review so long as it satisfies the Hickman principle.

This aspect of Darling Casino has been heavily criticised.  Aronson & Dyer, for instance, suggest that it is a contradiction in terms to set power limits whilst removing all judicial review. 

Subsequently, Stein JA of the NSW Court of Appeal doubted (notwithstanding Darling Casino) whether it was in fact possible for even a State Parliament entirely to oust judicial review.  See Woolworths Ltd v Hawke (1998) 45 NSWLR 13 at 18. 

On the other hand, Spigelman CJ in Vanmeld (at paragraph 37) appears to accept that a State Parliament could in theory oust judicial review completely but suggests that, at least in relation to "core matters" it would require the clearest possible express words:

"Rather, once the intention appears from the legislative scheme that the privative clause does in fact extend to jurisdictional error, then a final principle of statutory construction reflected in the Hickman principle must be applied. This is because the strict construction, appropriate for all such clauses, is applied with particular stringency to these core matters. Indeed, it may be so difficult to conceive of a form of words capable of satisfying a "necessary intention" test, that express words are, as a practical matter, required. (Cf R v Lord Chancellor; Ex parte Witham supra, 858 per Laws J)."

Thus, whether there are any restrictions on the extent to which States (and Territories) can oust review should be regarded as an open question.

Plaintiff S157 of 2002 v The Commonwealth of Australia [2003] HCA 2On 4 February 2003, the High Court handed down a decision which essentially overthrew many of the above observations.  The result of the Court's reasoning in Plaintiff S157 of 2002 v The Commonwealth of Australia [2003] HCA 2 (4 February 2003) is that the effect of a general privative clause will in most situations be fairly minimal; although that must always depend upon interpretation of the particular legislation under consideration.

Generally, however, the Court held that a privative clause will not protect a decision from judicial review for jurisdictional error.  The scope of jurisdictional error has been progressively widened in recent years since Craig v South Australia, and now includes the 'considerations' grounds, Wednesbury unreasonableness and denial of natural justice (both bias and procedural fairness).

It now appears that the only types of error a privative clause will protect against are non-jurisdictional error of law on the face of the record (which was narrowed almost out of existence in Craig anyway) and perhaps some minor procedural errors. 

The plaintiff in Plaintiff S157 was a failed visa applicant who claimed that, but for the privative clause (and the new time limits on claims in s436A of the Act) he would have been able to challenge the decision of the Refugee Review Tribunal ("the Tribunal") to not grant him a protection visa on the ground that the Tribunal failed to comply with the rules of procedural fairness. The plaintiff also challenged the new time limits on applications in the High Court's original jurisdiction in s468A. Gummow J stated a case on these two issues to the Full Court.

The plaintiff's primary argument with respect to the privative clause was that it was directly inconsistent with the terms of s75(v) of the Constitution and was thus wholly invalid.

The Commonwealth argued that, consistent with the clear legislative intent and the history of the Hickman doctrine, s474 had the effect of expanding the Tribunal's jurisdiction such that it had the power to make any decision that was a bona fide attempt to exercise its power, that related to the subject matter of the Act (ie related to migration decisions) and that was reasonably capable of reference to the power given to the Tribunal by the Act.

Thus, even if the Tribunal had not fully complied with the rules of procedural fairness, this would not have been a ground for judicial review of the Tribunal's decision.

The Migration Act Privative Clause

Section 474 of the Migration Act was inserted by the Migration Legislation Amendment (Judicial Review) Act 2001 (Cth) and came into effect on 2 October 2001. It contains the following privative clause:

(1) A privative clause decision:

(a) is final and conclusive; and(b) must not be challenged, appealed against, reviewed, quashed or called in question in any court; and(c) is not subject to prohibition, mandamus, injunction, declaration or certiorari in any court on any account.

(2) In this section:

privative clause decision means a decision of an administrative character made, proposed to be made, or required to be made, as the case may be, under this Act or under a regulation or other instrument made under this Act (whether in the exercise of a discretion or not), other than a decision referred to in subsection (4) or (5).

The similarity between sub-s (1) and the clause in Hickman was by no means coincidental, as the Minister's Second Reading Speech made clear:

The effect of a privative clause such as that used in Hickman's case is to expand the legal validity of the acts done and the decisions made by decision makers. The result is to give decision makers wider lawful operation for their decisions, and this means that the grounds on which those decisions can be challenged in the Federal and High Courts are narrower than currently.

In practice, the decision is lawful provided:

the decision-maker is acting in good faith; the decision is reasonably capable of reference to the power

given to the decision maker - that is, the decision maker had been given the authority to make the decision concerned, for

example, had the authority delegated to him or her by the Minister for Immigration and Multicultural Affairs, or had been properly appointed as a tribunal member;

the decision relates to the subject matter of the legislation - it is highly unlikely that this ground would be transgressed when making decisions about visas since the major purpose of the Migration Act is dealing with visa applications; and

constitutional limits are not exceeded - given the clear constitutional basis for visa decisions making in the Migration Act, this is highly unlikely to arise.

Thus the privative clause in the Migration Act represented an attempt at the highest example yet of cooperation between the courts and the Legislature. The Court had told Parliament that certain words will be construed as having a particular effect and Parliament took the hint and used those precise words with the expressed intention of having that precise effect.

The Federal Court - NAAV v Minister for Immigration and Multicultural Affairs and others [2002] FCFCA 228

As I have said, five of the most senior judges of the Federal Court, Black CJ and Beaumont, Wilcox, French and von Dousa JJ, examined the effect of this privative clause in five cases heard and decided together by the Full Court in 2002.

The cases covered a cross-section of circumstances and grounds of review - procedural fairness, misunderstanding the issue, taking into account an irrelevant considerations, error of law, making a decision under the wrong power and failure to comply with specific statutory requirements - in other words, most of the species of "jurisdictional error" identified in Craig v South Australia.

With respect to the so-called fourth Hickman proviso, the question whether the Act contained "inviolable limitations" on the exercise of administrative power beyond the classical three expressed by Dixon J, and, if so, what they are generated the a diversity of comment among the judges.

Black CJ took the view that a statute could be such that it contained inviolable limitations that a Hickman clause could not relax. The test, in his view, was whether there were limitations on decision-making power

that are essential to the structure of a statute. Von Doussa J, with whom Black CJ and Beaumont J expressed general agreement, spoke of a "jurisdictional factor that attracts the jurisdiction" of the decision-maker.

However, von Doussa J added that, in the context of the Migration Act, "the jurisdictional factors that will attract the authority and powers of decision-makers in the sense described in a particular case will be few." Indeed, von Doussa J suggested that the so-called fourth condition may not be significantly different from one of the three classical limitations, namely that a decision must reasonably capable of reference to the power given to the decision-maker.

Black CJ agreed that the inviolable limitations in the Act were very few. He nonetheless differed from von Doussa J in holding that in two of the five cases, certain statutory requirements in the visa application process (one of them of a procedural kind) were of such importance so as not to be relaxed by the Hickman clause. Wilcox and French JJ reached similar conclusions, although their reasoning was not the same.

Bodruddaza v Minister for Immigration and Multicultural Affairs (2007) 234 ALR 114

In Bodruddaza, the High Court held that the time limits in s 486A of the Act (up to 28 and then, possibly up to 84 days from actual notice of the adverse decision) were too restrictive in a legal and practical sense and were invalid under the Constitution.

The Court also discussed the traditional prerogative writ (now, constutional writ) remedies. Most interesting was that the Court demonstrated that the difference between a jurisdictional error and an error within jurisdiction (a “non-jurisdictional error”) truly matters in Australian law whenever there is a privative clause to contend with. The case concerned the Australian migration points system. To migrate to Australia as a “skilled migrant” one must achieve a certain amount of “points” in the class of visa provided for in the Migration Regulations. The applicant was a man from Bangladesh who needed 20 more points to so qualify. The Regulation awarded 20 points if the “applicant provides evidence of having achieved an [International English Language Testing System] test score of at least 6 for each of the 4 test components of

speaking, reading, writing and listening in a test conducted [in a specified period]”.

He sat for two tests in the specified period and did not achieve a score of 6 in either of them. However, when taken together, he did.

The Minister’s delegate would not take them together and determined they must be obtained in the one test. As a matter of statutory construction, the High Court agreed (at [71]-[74]) holding the presumption in ss 23 and 46(1) of the Acts Interpretation Act 1901 (Cth) that the singular includes the plural “must yield to the particular text involved”.

Significantly, the Court added (at [70]):

“[I]t is not immediately apparent that this had the consequence of vitiating the decision for jurisdictional error, rather than representing an error within jurisdiction which would not attract prohibition and mandamus under s 75(v) [of the Constitution]. The differential treatment of errors on the face of the record with respect to certiorari has often been noted (see, for example, Craig v South Australia (1995) 184 CLR 163 at 175-176.), but here certiorari can only be ancillary to relief under s 75(v) for jurisdictional error.”

Conclusions

Thus, in practical terms, the High Court privative clause decisions come to very little. We now know that the High Court adopts the "four proviso" version of the Hickman doctrine - where a statute contains both a privative clause and specific limitations on a decision-maker's power, the limits of the decision-maker's power will lie somewhere between the first three Hickman provisos and any apparent limits provided for in the statute - determined in each case by a process of interpretative reconciliation.

We know that procedural fairness applies under the old Act, but we are yet to find out whether it applies now that Parliament has passed the Migration Legislation Amendment (Procedural Fairness) Act 2002. All the other issues dealt with by the Federal Court in NAAV remain to be decided, perhaps in one or more of the four NAAV cases in which special leave to appeal to the High Court has been sought.