References to the FCA from the AAT
In what circumstances can and should the AAT refer questions of law to the Federal Court of Australia under s 45 of AAT Act?
Recently, a well-known academic in administrative law from the LaTrobe University, Darren O’Donovan, asked, on Twitter, about the process the AAT employs to refer a question of law (QOL) to the Federal Court of Australia under s 45 of the AAT Act. It was a question O’Donovan suggested could be asked at the next robodebt hearing— the Senate Standing Committee on Community Affairs inquiry into Centrelink’s Compliance Program — which will next sit on 29 March, 2021. That sitting will feature the AAT as a witness. Specifically, the AAT will be represented by its registrar, its director of tribunal services, and its chief legal officer.
My immediate prediction is that, even if the question were to be asked in that hearing, it would be unlikely that any of these representatives would be able to say much more than ‘AAT members refer questions of law to the FCA in accordance with legislation.’ Perhaps they could offer more than that. But what does the legislation say?
Section 45 of the AAT Act provides as follows:
45 Reference of questions of law to Federal Court of Australia
(1) The Tribunal may, with the agreement of the President, refer a question of law arising in a proceeding before the Tribunal to the Federal Court of Australia for decision. The Tribunal may do so on its own initiative or at the request of a party to the proceeding.
Note: This Part does not apply to certain migration proceedings (see section 43C).
(2) The Federal Court of Australia has jurisdiction to hear and determine a question of law referred to it under this section.
(2A) If, after consulting the President, the Chief Justice of the Court considers it appropriate, that jurisdiction is to be exercised by the Court constituted as a Full Court.
(3) Where a question of law arising in any proceeding has been referred to the Federal Court of Australia under this section, the Tribunal shall not, in that proceeding:
(a) give a decision to which the question is relevant while the reference is pending; or
(b) proceed in a manner, or make a decision, that is inconsistent with the opinion of the Federal Court of Australia on the question.
Notes on s 45
A first thing to note is that s 45(1) provides that a Tribunal may refer a question of law arising in a proceeding to the FCA with the agreement of the President. In other words, a Tribunal member has a discretion — not a duty — to refer a QOL to the FCA, but would presumably have to suspend the proceeding, and then consult with the President, who would then either agree or disagree with the member’s intention to refer the QOL to the FCA. From this first sentence of this provision alone, it is possible to note that the reference would be made under the supervisory authority of the Tribunal president.
A second thing to note about s 45(1) is that it permits the Tribunal to refer a QOL to the FCA on its own initiative or at the request of a party to a proceeding. This does not add a lot to the discussion; however, it may raise an argument — an argument that has been advanced on at least one occasion before (unsuccessfully, as we shall see below) — that the Tribunal may have some obligation to identify a QOL when it is raised by a party, or even when it is not raised by a party, and that, having so identified the QOL, the Tribunal may be bound, if it is is appropriate to do so, to refer that QOL to the FCA. Neverthless, this is a hard argument to make, because the term of the provision is ‘may’ — not ‘must.’ The provision would not seem to impose any duty or obligation on the Tribunal to refer.
A third thing to note about s 45 is this. Under s 45(2A), the Chief Justice of the FCA may constitute the Full Court of the FCA if they, after consulting the Tribunal President, consider it appropriate the that Full Court be so constituted.
The Federal Court of Australia Act 1976 (Cth) (FCA Act) requires certain matters must be heard and determined by a Full Court (comprising three or more judges) sitting in the Court’s original jurisdiction. Specifically, s 20(1A) provides that the Chief Justice may give a direction that the Full Court be constituted if a matter is of ‘sufficient importance’ to justify that a direction so be given. Section 20(2) also provides that matters coming before the FCA from a tribunal shall be heard by the FCA in its original jurisdiction as a Full Court.
Although I may be missing something here, this would seem to suggest that the FCA would hear referred matters in its jurisdiction as the Full Court of the FCA in any event — that is, even where s 45(2A) of the AAT Act were not a consideration. Just how s 45(2A) of the AAT Act and s 20(2) of the FCA Act interact is an interesting question, but one for another time. The FCA Act contains a few other provisions under s 20 relating to the exercise of original jurisdiction, but nothing of seeming relevance to referrals to the FCA under s 45(2) of the AAT Act.
A third thing to note are the two effects of a reference to the FCA under s 45 of the AAT Act. The first effect is as follows. Section 45(3)(a) prevents a Tribunal from delivering a decision where a QOL referred to the FCA relevant to that decision is still pending consideration by the FCA. In other words, if the Tribunal referred a QOL to the FCA, with that QOL being relevant to matter X, the Tribunal must sit on its hands and do nothing until that QOL is determined by the FCA, one way or another. In consequence, the AAT would not publish a decision in matter X while the referred QOL was being considered by the FCA.
I will make a quick comment on this provision. When O’Donovan asked his original question relating to the processes of the AAT, I responded with a question myself. I asked whether any published decisions of the AAT would reveal how often the AAT in fact does refer QOLs to the FCA under s 45 of the AAT Act. I asked that question before I read the section. It was probably a silly question. That’s because the effect of s 45(3)(a) would seemingly prevent anyone who was researching AAT decisions knowing whether the AAT has in fact referred any matter to the FCA. That is because no AAT matter will be able to be finalised while the relevant QOL is being determined in the FCA. Accordingly, no decision will be published by the AAT in respect of a ‘reference question matter’ until the FCA has determined the relevant QOL.
In relation to social security matters, the only publishable decisions are those of the AAT2 (in the General Division). The AAT1 does not publish its decisions. This seemingly may present a dilemma for public transparency: How would a member of the public know whether a QOL has been referred to the FCA under s 45 of the AAT Act? Presumably, the public notices and records (and decisions) published by FCA would disclose this fact. But it’s not entirely clear that would occur in circumstances where the FCA did not accept the reference or while the reference was pending.
The only other possibility might be that the QOL is considered not to be suitable for the FCA by the Chief Justice. Perhaps the Chief Justice would consider the QOL not to be of sufficient importance to be heard in the FCA, or perhaps the Chief Justice would consider the QOL to have been already settled, such as in circumstances where the FCA had already considered a similar or analogous question. In those circumstances, it might be that the AAT2 decision discloses the fact that the Tribunal referred the QOL to the FCA under s 45 but that the Chief Justice determined that the QOL was not suitable for determination by the FCA. In this case, the AAT2 decision might disclose something of this process, but perhaps only after a refused referral had occurred. However, it is also possible that a Tribunal decision could omit this matter altogether. In any case, it is interesting to think that a search of the AAT decisions by a researcher would not necessarily disclose to them the frequency with which the AAT has made use of s 45.
The second effect of a reference to the FCA under s 45 of the AAT Act is this. Section 45(3) prevents the Tribunal from proceeding in any way, or making any finding, that is inconsistent with the determination of the FCA. Thus, if in proceeding X, the Tribunal refers a relevant QOL to the FCA, then, for that proceeding X, the Tribunal must proceed and decide the proceeding in a way that is consistent with the FCA’s opinion about that relavant QOL. I take it that this would also effectively mean that, in future proceedings in which the same QOL arises, the Tribunal would again be bound to proceed and decide the matter in a way that is consistent with the FCA’s previous opinion on the relevant QOL.
In other words, although the administrative tribunal process is sometimes thought to be not strictly regulated by stare decisis and precedent, it is arguably bound to follow the opinions of the FCA on questions of law, including those relevant to the application of the law under the AAT Act. As one former President of the AAT has written, even though
no formal doctrine of precedent exists in administrative law, members of the Administrative Appeals Tribunal will follow earlier decisions of the Tribunal unless they are satisfied that the earlier decision is manifestly wrong.1
Are there any cases?
Having hypothesised that the AAT2 decision database will not disclose when and in what circumstances a Tribunal will refer QOL to the FCA under s 45 of the AAT Act, it is nevertheless probably a good idea to run a search of the relevant social security decisions published by the AAT2.
When one searches for cases in which s 45 of the AAT Act is cited, a few migration cases appear. That is because the Migration Act 1958 (Cth) (for eg, under s 476A(1), places certain restrictions on when a migration Tribunal can refer a QOL in a migration matters to the FCA.
Searches of these cases using the keyword ‘Centrelink’ turned up two relevant examples.2 I will briefly examine one below.
Mentink
In Mentink v Secretary, Department of Social Services [2018] FCA 1660 (Mentink), the issue that initiated the proceedings was essentially whether the applicant was an Australian resident and was therefore qualified to receive the age pension under the relevant provision: s 7(2) of the Social Security Act 1991 (Cth) (SSA Act). The Tribunal had found that the applicant was not a qualifying resident. The applicant appealed to the FCA under s 44(1) of the AAT Act — ie, in the ordinary way. (It was not a referral by the AAT to the FCA under s 45 of the AAT Act.)
In the applicant’s fourth ground of appeal, however, the applicant contended that the Tribunal had failed to identify that the applicant had raised a question of law and had failed to refer that question of law to the FCA under s 45 of the AAT Act. While only ground 4 is of real interest, for completeness, the four grounds of appeal are provided below:
The Tribunal erred in law by failing to recognise in respect of s29 of the Social Security Administration Act (1999) the Parliament’s intention that s29 enunciate a general rule exceptions to which are not exhaustively defined by ss 30, 30A, 31, 31A and 32.
The Tribunal erred in law by failing to recognise the generality of s7 of the Social Security Act (1991) and not giving effect in s7(1) to the words “unless the contrary intention appears”, such contrary intention being expressed by the Parliament in enacting s1217 of the Social Security Act.
The Tribunal erred in law by failing to find that s7 of the Social Security Act cannot be invoked to defeat the Parliament’s intention in s1217 and that this is particularly so considering the widely accepted principle that the said Act is beneficial legislation.
The Tribunal denied the Appellant procedural fairness by failing in its reasons for decision to identify the above issues of law as arising from the Appellant’s written and oral submissions, by failing to declare that a question of law had been raised, by failing to decide the question of law or to refer the question of law to the Federal Court pursuant to s45 of the Administrative Appeals Tribunal Act 1975.3
Unfortunately, Greenwood J did not directly address the different failures contended by the applicant under ground 4, since the broader statutory construction relied on by the applicant to show that a question of law had arisen under grounds 1 through 3 had been rejected in two prior appeals by the applicant, and this therefore rendered ground 4 moot. As his Honour wrote:
Excluding the words commencing after “by failing to declare” in the third line, ground 4 is identical to ground 4 of the notice of appeal in that earlier proceeding. The applicant’s construction of the statute, which informs the first three grounds of the notice of appeal, was unambiguously rejected by this Court, and on appeal by the Full Court in Mentink v Secretary Department of Social Services (2016) 238 FCR 1. It is unnecessary to say anything further on the proper construction of the statute, other than to reiterate the Full Court’s conclusions that there is nothing in the legislation which suggests that the factors set out in s 7(3) of the 1991 Act have been displaced by a contrary intention ((2016) 238 FCR 1 [42]), and that this outcome is consistent with the beneficial nature of the legislation ((2016) 238 FCR 1 [46]).
Accordingly, this case did not fully consider whether a question of law should have been identified by the AAT and in what circumstances it should have referred such a question to the FCA, even though it was a ground of contention.
There is, by contrast, much more written on what may constitute a question of law for the purposes of founding the FCA’s jurisdiction for the purposes of an ordinary appeal under s 44 of the AAT Act. Indeed, when an applicant appeals an AAT2 decision to the FCA under this s 44, the subject matter of that appeal is limited to questions of law raised in the applicant’s notice of appeal.
In Mentink, Greenwood J makes a few statements about questions of law under s 44 of the AAT Act. Relying on Haritos,4 Greenwood J notes that in dertemining whether a question of law has substance, the FCA must consider the ‘alleged questions of law, the grounds raised, the statutory context, and the Tribunal’s reasons for its decision' (Haritos at [94]).’ His Honour also noted that the Court should have ‘regard to the applicant’s written submissions in identifying whether a question of law is raised,’ including even when the applicant’s submissions in respect of the question of law are ‘inelegantly drafted’ (quoting Wigney J in P v Child Support Registrar (2013) 62 AAR 17 at [53]). The real question here, Greenwood J’s judgment indicates, is whether the alleged question of law is ‘tolerably clear having regard to the context in which it appears.’5
It is arguable that these principles, arising from the Federal Court of Australia, are relevant to the consideration of a Tribunal tasked with determining whether a question of law arises in a proceeding that would, or could, form the basis of a referral to the FCA under s 45 of the AAT Act. However, with no clear jurisprudence on the specific question of the circumstances in which a Tribunal must so refer, the processes by which the Tribunal will or must do so remain unclear.
In the context of the robodebt class action, and the Senate inquiry into Centrelink’s Compliance Program, it might be arguable that the Tribunal was, at some point in some case in the AAT2, probably in a position to refer a question of law to the FCA under s 45 of the AAT Act. However, in the absence of an applicant contending that the AAT should have done the same, it is difficult to determine whether a failure by the Tribunal to do so would have amounted to a denial of procedural fairness, as was contended by the applicant in Mentink.
However, given the fact that the FCA settlement has been mostly agreed (though not approved by the FCA), and given that there have been public record statements in which the Attorney General has conceded that there was a ‘legally insufficient’ basis for the recovery of the debts the subject of that FCA settlement, it is certainly possible that a question of law was actually raised in the course of one or other appeals at the AAT, and that the AAT might have failed to have identified it, or failed to have referred it to the FCA under s 45 of the AAT Act.
See (1) https://jade.io/article/619338; and (2) https://jade.io/article/518925.
https://jade.io/article/619338, para 36.
Haritos and Another v Federal Commissioner of Taxation (2015) 233 FCR 315.
Haritos at [53], citing Ergon Energy Corp Ltd v Commissioner of Taxation (2006) 153 FCR 551; 232 ALR 652; 94 ALD 1; [2006] FCAFC 125 at [51].