FEDERAL COURT OF AUSTRALIA ADMINISTRATIVE LAW – Natural Justice – refusal by Australian Securities Commission ("ASC") of application for unrestricted dealer's licence under s 784 of Corporations Law ("Law") – hearing before Delegate of ASC under s 837 of Law – Delegate taking into account a document forwarded to him, but not applicant, by officer of ASC after conclusion of hearing – whether breach of rules of natural justice – policy documents issued by ASC as to qualifications and industry experience looked for in satisfaction of par 784(2)(c) of Law – Delegate's regard for policies – effect on Delegate's decision. Corporations Law ss 784, 837 King Gee Clothing Co Pty Ltd v Commonwealth (1945) 71 CLR 184, distinguished Kioa v West (1985) 159 CLR 550, applied Sacharowitz v Minister for Immigration, Local Government and Ethnic Affairs (1992) 33 FCR 480, distinguished Wickramasena v Griffin (1990) 95 ALR 187, followed Doughty v Corporate Affairs Commission (1988) 6 ACLC 1090, followed Re Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634, distinguished AMREIN ASSOCIATES PTY LIMITED v AUSTRALIAN SECURITIES COMMISSION NG 3295 OF 1997 LINDGREN J 26 AUGUST 1998 SYDNEY IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY NG 3295 of 1997 BETWEEN: AMREIN ASSOCIATES PTY LIMITED Applicant AND: AUSTRALIAN SECURITIES COMMISSION Respondent JUDGE: LINDGREN J DATE OF ORDER: 26 august 1998 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The application be dismissed. 2. The applicant pay the respondent's costs. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY NG 3295 of 1997 BETWEEN: AMREIN ASSOCIATES PTY LIMITED Applicant AND: AUSTRALIAN SECURITIES COMMISSION Respondent JUDGE: LINDGREN J DATE: 26 august 1998 PLACE: SYDNEY REASONS FOR JUDGMENT Introduction The applicant ("AAPL") applies for review of a decision of the respondent ("the ASC") given on 10 December 1997 to refuse to grant to AAPL an unrestricted dealer's licence under s 784 of the Corporations Law ("the Law"). LEGISLATION AND Background Facts Section 780 of the Law provides, relevantly, that a person must not "carry on a securities business" or "hold out that the person carries on a securities business" unless the person holds a dealer's licence. Section 93 describes a "securities business" as "a business of dealing in securities". Section 9 describes the act of "dealing" in relation to securities as the act of acquiring, disposing of, subscribing for, or underwriting securities. Subsection 782 (1) provides that a person might apply to the ASC in the prescribed form and manner for a dealer's licence. Section 784 of the Law provides: "(1) This section has effect where a body corporate applies for a licence. (2) The Commission shall grant the licence if: (a) the application was made in accordance with section 782; (b) the applicant is not an externally-administered body corporate; (c) the Commission is satisfied that the educational qualifications and experience of each responsible officer of the applicant are adequate having regard to the duties that the officer would perform in connection with the holding of the licence; and (d) the Commission has no reason to believe that the applicant will not perform efficiently, honestly and fairly the duties of a holder of a licence of the kind applied for. (3) Otherwise, the Commission shall refuse the application. (4) In determining whether or not it has reason to believe as mentioned in paragraph (2) (d), the Commission shall have regard, in relation to each responsible officer of the applicant, to: (a) whether or not the officer is an insolvent under administration; (b) any conviction of the officer, during the 10 years ending on the day of the application, of serious fraud; (c) any reason the Commission has to believe that the officer is not of good fame and character; and (d) any reason the Commission has to believe that the officer will not perform efficiently, honestly and fairly the duties that the officer would perform in connection with the holding of the licence. (5) A licence granted under a previous law of this jurisdiction corresponding to this section and in force at the commencement of this Part shall be deemed to have been granted under this section." Subsection 785 (1) provides that s 784 applies subject to, relevantly, s 837. Section 837 is as follows: "(1) The Commission shall not: (a) refuse, … an application for a licence; …. unless the Commission complies with subsection (2) of this section. (2) The Commission shall give the applicant, licensee or person, as the case may be, an opportunity: (a) to appear at a hearing before the Commission that takes place in private; and (b) to make submissions and give evidence to the Commission in relation to the matter." On 8 August 1997, TATUM Consulting Pty Ltd lodged the subject application for the licence on behalf of AAPL. The services to be provided by AAPL were described in the application as follows: "To provide securities recommendations about Australian listed securities to Middle Eastern and European investors. The nature of the business is to provide a bottom up approach to stock selection. The recommendations will be based on analytical information obtained by Amrein from its own company visits and from major ASX broker their research publications gained through negotiated for the referral of clients to these brokers [sic]. The fees received by Amrein will be an agreed proportion of the brokerage charged by the broker. Full details of this fee sharing arrangement will be shown on the broker's contract note. No other fees or benefits will apply." The only "responsible officer" nominated for the purposes of s 784 was Mr Hans Peter Amrein ("Amrein"), who is also the sole director of AAPL. The application contained details of Amrein's educational qualifications, employment history, previous authorisations relating to dealing in securities, and relevant experience. The application also annexed his curriculum vitae, references from previous employers, and a five page document purporting to set out, as required by the application form (Form 701), Amrein's familiarity with the relevant provisions of the Law. By a letter dated 2 October, the ASC notified AAPL that the ASC intended to refuse its application on the ground that Amrein did not satisfy the requirements of par 784 (2) (c). The letter advised that AAPL was entitled, pursuant to s 837 of the Law, to the opportunity of a private hearing before a delegate of the ASC, at which it could make submissions and give evidence in relation to the matter. AAPL availed itself of this opportunity. Accordingly, a hearing was held on 27 November before Cyril James Reynolds, a delegate of the ASC ("the Delegate"). At the hearing, AAPL was represented by Mr JGF Harrowell ("Harrowell") and Mr J Wicki of Hunt and Hunt solicitors. Ms Ailsa Wilson ("Wilson") and Ms Mei Ling Perry ("Perry") participated via videolink on behalf of the ASC. Various documents were submitted on behalf of AAPL and the ASC. Amrein and Perry were questioned by the Delegate and by the solicitors, Harrowell and Wilson. After the hearing, by facsimile dated 1 December, Perry forwarded to the Delegate a copy of pages 2–13 of Part A of a "Licensing Kit" of the ASC. This document had not been provided to the Delegate or AAPL before the hearing or referred to at it, but a copy was later attached to the Delegate's Reasons for Decision referred to below. On 10 December, the Delegate decided to refuse AAPL's application on the ground that he was "not satisfied that the provisions of paragraph 784(2)(c) of the Law in respect to Mr Amrein as a key person [had] been satisfied", and issued his Reasons for Decision. On 22 December, AAPL commenced the present proceeding. At the first directions hearing on 5 March 1998, the parties submitted that the case should proceed by way of written submissions and an agreed bundle of documents, without the necessity of an oral hearing. On 11 May, judgment was reserved on the basis of the parties' written submissions and the tender of an agreed bundle of documents, consisting of the evidence which had been before the Delegate and his Reasons for Decision. AAPL's PRESENT application AAPL's present application is headed "Application for an Order of Review". It does not comply with O 4 r 3 (1) (b) of the Federal Court Rules in that it does not specify the Act pursuant to which the relief claimed is sought. The parties' submissions have, however, proceeded on the assumption that the application is made pursuant to s 5 of the Administrative Decisions (Judicial Review) Act 1977 (Cth) ("the ADJR Act"). The application sets out four grounds of review as follows: "1. That a breach of the rules of natural justice occurred in connection with the making of the decision. Particulars 1.1 After the conclusion of the hearing on 27 November 1997 by facsimile dated 1 December 1997, the Respondent's Delegate received further material ("further material") from an officer of the Respondent (see decision paragraph 2.6). 1.2 The Respondent's Delegate failed to advise the Applicant or his legal representatives of the receipt of further material. 1.3 The Respondent's Delegate failed to provide the further material to the Applicant and/or allow the Applicant to be heard or to lodge submissions concerning the receipt and or content of the further material. 1.4 The Respondent's Delegate had regard to the further material in making the decision (see decision paragraph 6.6). 2. The procedures required by Law to be observed in making the decision were not observed. Particulars The Respondent is required to follow the procedure in Section 837 of the Law and failed in relation to the further material to allow the Applicant to make submissions and give evidence as provided in Section 837(2) of the Law. 3. The Decision was made pursuant to the Law and the Law does not authorise the Respondent's Delegate to refuse the Application by reason of Mr Amrein not having the qualifications referred to in paragraph 7.38 of the decision. Particulars 3.1 The Law and related Regulations do not prescribe or define the qualifications required under Section 784(2)(c) and this was conceded at the hearing. 3.2 The ASC Procedures Manual, Media Releases and Discussion Papers issued by the Respondent cannot create or define legal requirements which are not otherwise expressly authorised by the Law. 3.3 The Respondent conceded in any event that the ASC Procedures Manual was "not up to date" (Perry Statement page 6 paragraph 7). 4. The decision was otherwise contrary to Law. Particulars The Law does not require that any Applicant for a dealers licence pursuant to Section 782 [of the] Law hold qualifications as referred to in paragraph 7.38 of the decision and the refusal to grant a licence in the absence of the qualifications referred to in paragraph 7.38 is contrary to Law." Grounds 1 to 4 correspond to the grounds specified in pars 5 (1) (a), (b), (d) and (i) of the ADJR Act. THE DECISION OF THE DELEGATE At the time of giving his decision on 10 December 1997, the Delegate had before him various materials prepared by the ASC and forwarded by it to AAPL by the time of the hearing, documents produced by Harrowell at the hearing, the oral submissions of Harrowell and Wilson, the evidence given by Perry and Amrein, and pages 2 to 13 of Part A of the ASC's Licensing Kit which was forwarded to the Delegate by Perry by facsimile on 1 December 1997, four days after the hearing ("the Additional Material"). It is common ground that a copy of the Additional Material was not provided to AAPL or its solicitors before the Delegate made his decision, and that AAPL had no opportunity to make submissions in relation to it. This omission forms the basis of grounds 1 and 2 set out above. On the hearing before the Delegate, the issue was whether the ASC should have been "satisfied that the educational qualifications and experience" of Amrein as the "responsible officer" of AAPL were "adequate having regard to the duties that [he] would perform in connection with the holding of the licence": par 784 (2) (c) of the Law. The Law does not specify what is to constitute "adequate" "educational qualifications and experience". However, the ASC had issued a Procedures Manual, Licensing Review Report (released in November 1995), Media Release (released on 13 February 1996) and an exposure draft (released on 5 June 1996), all of which deal with the level of qualifications and experience that were looked for by the ASC. All of these documents were provided to AAPL before the hearing. The "Licensing Kit", part of which constituted the Additional Material, was apparently released by the ASC in August 1997. The Delegate appears to have considered that the ASC Media Release (ASC 96/21) dated 13 February 1996 ("the Media Release") provided the neatest summary of the ASC's policy. The Media Release stated: "From 1 April 1996, applicants for investment adviser's and securities dealer's licences whose business includes providing advisory services will require: · a tertiary qualification in a financial discipline or similar field (ie economics, commerce or business); and · a recognised industry qualification (for this purpose, the ASC will recognise the Certificate in Financial Markets and Diploma in Applied Finance and Investment of the Securities Institute of Australia, the Diploma of the Financial Planning Association of Australia or the Diploma of Advanced Financial Planning of the Australian Society of Certified Practising Accountants). Applicants with these qualifications will also need to demonstrate at least two years relevant industry experience. The ASC has determined that shorter courses such as the Financial Planning Certificate Course of the Australian Society of Certified Practising Accountants and Institute of Chartered Accountants will be acceptable if applicants can also demonstrate at least five years relevant industry experience." (emphasis supplied) The Delegate rejected a submission by AAPL that the ASC was not entitled to reject its application on the ground that an individual lacked a particular educational qualification. The Delegate said: "although paragraph 784(2)(c) of the Law does not prescribe what are nor define 'educational qualifications' and 'experience', the paragraph does place an obligation upon the ASC to satisfy itself of the adequacy of 'the educational qualifications and experience' of each responsible officer". The Delegate referred to authorities which establish that general rules of policy which represent "considered views", reduce inconsistency and may be taken into account by administrative decision-makers and by courts in reviewing their decisions: cf Re Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634 (AAT/Brennan J) at 639-640; Doughty v Corporate Affairs Commission (1988) 6 ACLC 1,090 (NSW/Waddell CJ in Eq) at 1,093. The Delegate considered that: "the ASC Media Release, ASC 96/21, is an ASC policy document which informs all potential applicants for a securities licence of the criteria to be applied by the ASC in assessing applications … [T]he Media Release, along with the ASC Procedures Manual, is not in conflict with the provisions of paragraph 784(2)(c) of the Law but rather is the ASC's interpretation of those provisions." However, the Delegate also referred to decisions such as Sacharowitz v Minister for Immigration, Local Government and Ethnic Affairs (1992) 33 FCR 480 and Howells v Nagrad Nominees Pty Ltd (1982) 43 ALR 283 (FCA/FC) at 307, which he considered established that policies must not be slavishly followed as a substitute for the exercise discretion on the particular facts of a particular case, and that the merits of the particular case must be properly, genuinely and realistically considered. Against this background, the Delegate turned to consider the three issues of the educational qualifications, industry qualifications, and industry experience of Amrein. AAPL's application to the ASC claimed that Amrein had the following qualifications and experience: 1) The "educational qualifications" which Amrein claimed to have were as follows according to AAPL's application: "INSEAD International Young Managers Programme (1982) International Executives Programme (1993) INSEAD is an international business school, the European equivalent of the Harvard Business School. The courses undertaken are post-graduate business studies courses of 9 weeks duration." 2) The application was accompanied by a "Statement of Attendance" in respect of the "Stockbrokers' Compliance Course" conducted by the Education Section of the Securities Institute of Australia. 3) Amrein was said to have the following "authorisations to carry on activities": "1. Held a Proper Authority from Findlay & Co Stockbrokers from 24 March 1997 to date. 2. Admission to the FWB Frankfurter Wertpapierbörse [stock exchange] as Exchange Trader from 1.1.87 to 31.10.90." 4) Finally, Amrein was said to have experience of a "broad range of investment products". In particular, it was said that "Mr Amrein as an employee of international companies mentioned in Annexure B has acted as agent on behalf of clients who wished to place orders for financial futures that were relevant to the portfolios they maintained. …. Mr Amrein has worked within the financial services industry since leaving school in 1977 and operated in trading, analyst and adviser capacities with leading financial institutions in various international financial centres. His extensive experience spans a broad range of securities and has serviced both institutional and private investors. The depth of the experience and nature of the activities are self evident from the Curriculum Vitae included with the application." In relation to "educational qualifications" the Delegate concluded that Amrein did not fulfil "the ASC's requirements in respect to tertiary qualifications". At the hearing, Amrein conceded, in response to questioning by the Delegate, that the INSEAD courses were "executive management" programmes which had no educational pre-requisites and were not directed specifically to dealing in securities or investments for and on behalf of other people. With respect to "industry qualifications", the Delegate said that there was "no evidence was produced that Mr Amrein's completion of the INSEAD courses or qualifications held by him for entry to the Frankfurt Stock Exchange were acceptable to either the Securities Institute of Australia or the Financial Planning Association of Australia as full or partial completion of a course recognised by the ASC". Of the "Stockbrokers' Compliance Course", the Delegate noted that the course did not involve any form of assessment, was not recognised as securing an exemption in any of the industry courses recognised by the ASC, and was, apparently, "purely of an informative nature to update current knowledge on compliance issues". He therefore concluded that Amrein did not have an industry qualification of the kind described in the Media Release. In relation to "industry experience", however, the Delegate concluded that Amrein satisfied the ASC's requirement. The Delegate went on to consider various "policy documents" issued by the ASC to determine whether Amrein's lack of tertiary educational qualification and industry qualification could be compensated for by his industry experience. One of these documents was an "ASC/ISC Exposure Draft 5" which was released in June 1996. That document described three "Options" by which applicants for licences might satisfy the educational and experience requirements. "Option 1" required an applicant to have one of a number of named "full industry qualifications … recognised by the ASC/ISC" and the equivalent of three years' relevant industry experience over the preceding five years. The Delegate noted that Amrein did not satisfy Option 1 as he did not possess any of the industry qualifications referred to. "Option 2" required an applicant to have a relevant tertiary qualification in a financial discipline or similar field as well as a "short industry qualification … recognised by the ASC/ISC". Amrein did not satisfy this option either. Option 3 was as follows: "Under this option, persons who do not have the formal qualifications required under Option 1 or 2 above will be able to demonstrate that they have the appropriate competencies by: · having the equivalent of five years relevant industry experience over the immediate past eight years; and · being able to satisfy an industry based competency assessment process (eg a comprehensive examination process) which will demonstrate competencies that are comparable to the level of competencies of persons who have the relevant educational qualifications under Options 1 or 2 above. Although there is no such industry based assessment process currently available, the ASC and ISC are of the view that there are industry, educational and professional bodies which have the necessary expertise and resources to develop such an assessment process." The Delegate was satisfied that Amrein had more than five years' relevant industry experience over the immediately preceding eight years. However, he did not consider that the INSEAD courses, "the qualifications held by [Amrein] for entry to the Frankfurt Stock Exchange" (the nature of which were not established by the evidence), or the Stockbrokers' Compliance Certificate course, were sufficient to demonstrate competencies comparable to those of persons who had the qualifications referred to in Option 1 or 2. He therefore concluded that Amrein did not satisfy Option 3. Another ASC policy document considered by the Delegate was the "ASC Procedures Manual" ("the Manual"). Paragraph 935 of the Manual stated: "Partially deficient educational qualifications might be compensated for by exceptional experience, eg. where the applicant has had at least 5 years' highly relevant and successful experience with a major trading bank or other financial institution in the appropriate area, or as a director or principal trader with a broker or adviser, but no tertiary qualification." AAPL submitted that Amrein had such "exceptional experience". It referred to Doughty v Corporate Affairs Commission (1988) 6 ACLC 1090 at 1093, where Waddell CJ in Eq discussed the importance of experience in the assessment of an applicant's suitability to be licensed as an investment adviser. However, the Delegate considered that par 935 had to be read in conjunction with par 850 which stated that the relevant minimum educational requirements were: "(a) Degree/diploma in accounting, commerce, economics, business studies, law – from an Australia tertiary institution; or an equivalent overseas qualification; or (b) Postgraduate qualification in business studies or business administration; or (c) Tertiary qualification not specified in (a) or (b) above plus a securities industry qualification, eg. (i) Financial Planning Association of Australia Diploma of Financial Planning; (ii) Securities Institute of Australia Diploma in Applied Finance and Investment; (ii) SIA Certificate in Financial Markets; or (iv) Australian Society of Certified Practising Accountants Financial Planning Certificate." The Delegate said that in order to satisfy the provisions of par 935, "Amrein would need to demonstrate that he is near completion of one of the qualifications required in paragraph 850", but that it was not shown that Amrein held any qualification "comparable to those noted in paragraph 850" or was "undertaking any course of study" leading to such a qualification. He distinguished Doughty on the grounds that (1) the applicant in that case had in fact been awarded the degree of Bachelor of Business, and (2) the legislation in question required the Commission to be satisfied as to an applicant's educational qualifications or experience, whereas par 784 (2) (c) requires the ASC to be satisfied as to an applicant's educational qualifications and experience. Finally, the Delegate referred to the possibility of issuing a licence subject to a restriction on the activities that AAPL could undertake. However, he rejected this course, saying that he "would need to be satisfied all of the ASC's requirements for the issuing of a licence [were fulfilled] before" doing so. The Delegate's decision was that he was not satisfied that the provisions of par 784 (2) (c) of the Law were satisfied and that AAPL's application dated 21 August 1997 for an unrestricted dealer's licence was refused. REASONING ON THE PRESENT APPLICATION FOR REVIEW The Additional Material The first two grounds of review relate to the failure of the Delegate to provide a copy of the Additional Material to AAPL or its legal advisers, and to give AAPL an opportunity to make submissions in relation to it. AAPL submits that this failure constituted a breach of the rules of natural justice or a breach of the procedures which s 837 of the Law, set out earlier, required to be followed, that is, the procedures of giving AAPL an opportunity to appear at a hearing before the ASC and to make submissions and give evidence to the ASC in relation to the matter. The Delegate's Reasons for Decision contain only three references to the Additional Material. First, par 2.6 is as follows: "By a facsimile dated 1 December 1997 Ms Perry forwarded to the Delegate a copy of pages 2 to 13 of Part A of the ASC's Licensing Kit, attached at Annexure 'A'." Second, in section 6 headed "Materials on which findings were made", the Delegate listed, inter alia, "6.6 The copy of pages 2 to 13 of Part A of the ASC's Licensing Kit and found at Annexure 'A'." Third, in par 7.15, under the heading "Experience", the Delegate noted: "7.15 Both the Media Release and the Licensing Kit are silent on what is meant by 'relevant industry experience' ". Accordingly, the Reasons for Decision do no more than to note the existence of the Additional Material and to record that it is silent on a matter. AAPL refers to the decision of Burchett J in Sacharowitz v Minister For Immigration, Local Government And Ethnic Affairs (1992) 33 FCR 480. I cannot find any support in that case for AAPL's present submission. That case concerned an application for permanent resident status under s 6A (1) (b) and (e) of the Migration Act 1958. The basis of the application was that policy guidelines had been applied rigidly without consideration of the merits of the individual case. The decision-maker had stated: "Applicants are also required to meet policy requirements for the grant of resident status under s 6A(1)(b) of the Migration Act, unless there are compelling requirements to waive normal policy requirements." Paragraph 6A (1) (b) required, relevantly, that the person be "the spouse, child or aged parent of an Australian citizen or of the holder of an entry permit". In relation to this requirement, there was in existence a statement of policy guidelines. After setting out the guidelines, Burchett J said that, if valid, they "could not possibly be treated as general requirements of the application of s 6A (1) (b), as distinct from mere guidelines" (at 485). His Honour held that the decision-maker had erred in taking the policy to be "a requirement from which departure could be justified only in the case of compelling reasons" (at 486-7). The Sacharowitz case is far removed from the present one. The terms of par 6A (1) (b) were so certain and specific that it is questionable whether they allowed scope for any policy guidelines at all. Moreover, the terms of the policy guidelines, if treated as requirements of general application, went beyond 6A (1) (b) (for example, they required that "[t]he relative providing support should have been a permanent resident in Australia for at least two years"). In the present case, the relevant criterion is clearly one calling for assessment and evaluation ("satisfied that the educational qualifications and experience … are adequate having regard to the duties that the officer would perform …"). In any event, as will appear, the Delegate was not inflexible in his approach to the policy documents in the present case. It is not correct to say that every failure to make prior disclosure of a document which is referred to in Reasons for Decision will necessarily amount to a denial of natural justice by an administrative decision-maker: see Wickramasena v Griffin (1990) 95 ALR 187 (FCA/Wilcox J) at 192. Rather, it will be necessary to consider the contents of the document to determine whether natural justice required the decision-maker to notify the parties of its existence or provide them with a copy of it. So much is made clear in the following passage from the judgment of Brennan J in Kioa v West (1985) 159 CLR 550 at 629: "A person whose interests are likely to be affected by an exercise of power must be given an opportunity to deal with relevant matters adverse to his interests which the repository of the power proposes to take into account in deciding upon its exercise: Kanda v Government of Malaya [1962] AC 322, at p 337.; Ridge v Baldwin [1964] AC, at pp 113-114 per Lord Morris; De Verteuil v Knaggs [1918] AC, at pp 560, 561. The person whose interests are likely to be affected does not have to be given an opportunity to comment on every adverse piece of information, irrespective of its credibility, relevance or significance. Administrative decision-making is not to be clogged by inquiries into allegations to which the repository of the power would not give credence, or which are not relevant to his decision or which are of little significance to the decision which is to be made. Administrative decisions are not necessarily to be held invalid because the procedures of adversary litigation are not fully observed. As Lord Diplock observed in Bushell v Environment Secretary [1981] AC, at p 97: 'To 'over-judicialise' the inquiry by insisting on observance of the procedures of a court of justice which professional lawyers alone are competent to operate effectively in the interests of their clients would not be fair.'" I have referred earlier to the "minimal" reference to the Additional Material in the Delegate's Reasons for Decision. This is understandable because, importantly, the Additional Material did not contain anything of significance that was not contained in the documents that had been provided to AAPL before the hearing and upon which it had the opportunity to comment. The Additional Material stated that the current requirements were a tertiary qualification in a financial discipline and an industry qualification combined with a stipulated level of industry experience. The statement accorded with the extract from the Media Release set out earlier which was taken into account by the Delegate. In any event, the Delegate based his decision squarely on material to be found in the documents that were provided to AAPL. In summary, the substance of the Additional Material had already been disclosed and the Additional Material had no independent significance for the Delegate's decision-making. It follows that the failure to provide a copy to AAPL and to afford AAPL the opportunity of making submissions in relation to it, did not amount to a breach of the rules of natural justice or of the procedures required by the Law to be followed. Amrein's lack of a tertiary educational qualification Paragraph 784 (2) (c) reflects a legislative intention to rely upon the qualifications and experience of the ASC to assess and evaluate the "educational qualifications" and the "experience" of each responsible officer of a corporate applicant and to reach a conclusion as to whether they are "adequate". It is contemplated that in a particular case, as in the present one, the conclusion may be that the ASC is satisfied in respect of "experience" but is not satisfied in respect of "educational qualifications". AAPL's submissions fail to pay sufficient regard to this position, in my view. They would seem not to countenance the mention of any level of educational qualifications no matter how low, in an ASC policy document. The third and fourth grounds of review are related. Both depend upon a submission that the Law does not itself prescribe a level of educational qualification or of experience required of each responsible officer of an applicant for a dealer's licence, and that the ASC policy documents "cannot create or define legal requirements which are not otherwise expressly authorised by the Law". AAPL submits that the ASC is not permitted to require an applicant for a dealer's licence to have a tertiary educational qualification and that the Delegate erred in finding that Amrein's lack of such a qualification was fatal to AAPL's application. AAPL also submits that there is inconsistency between the various policy documents of the ASC, and that, "particularly in relation to regulations which restrict or prevent a person engaging in their occupation there must be a degree of certainty and clarity as to the requirement expected of a member of the public seeking to comply with their legal obligations". AAPL refers, in this respect, to the judgment of Dixon J in King Gee Clothing Co Pty Limited v The Commonwealth (1945) 71 CLR 184. It is important to note, at the outset, a flaw in AAPL's submission: the ASC's policy documents purport, not to "create or define legal requirements", but to provide an indication of the level of education and experience that will be expected of applicants for dealer's licences. I was referred to numerous authorities on the general question of policy statements by administrative decision-makers as to how administrative discretions can ordinarily be expected to be exercised. With respect, I do not find it necessary to refer to more than the decision of Waddell J, the then Chief Judge in Equity of the Supreme Court of New South Wales in Doughty v Corporate Affairs Commission (1988) 6 ACLC 1090 at 1093. Although relating to earlier legislation, the following observations by his Honour in that case appear to me, with respect, to state the position accurately: "The NCSC has issued a Procedures Handbook which deals with the topic of licensing and which purports to set out guidelines for use by the various State administrations to which its powers are delegated. Paragraphs 4.05 to 4.07 deal with applications for an investment dealer's licence … The Handbook is, of course, no more than a guide and cannot, as a matter of law, fetter the discretion of the Corporate Affairs Commission or of the Court, on appeal. However, what is said seems to me to be reasonable and sensible and, provided that it is appreciated that the rules set out in the handbook are no more than a guide and that each individual case should be dealt with on its merits, does serve a useful purpose. They represent the considered views of the authority which is charged by law with administration of the Securities Industry Code and these should be taken into account by the Court." It is true, as AAPL submits, that in Re Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634, Brennan J noted (at 640-1) that "a policy must be consistent with the statute", and spoke in terms of "lawful" and "unlawful" policies. However, it is clear that the point his Honour was seeking to make was that a policy must not "create a fetter purporting to limit the range of discretion conferred by a statute", that is, that the "discretion cannot be so truncated by a policy as to preclude consideration of the merits of specified classes of cases". Importantly, the question for decision in this case is not whether the ASC's policy is lawful or unlawful but whether the Delegate's decision is infected by error. Therefore, the substantial issue is whether the Delegate in fact followed the ASC policy to the extent of not properly and genuinely considering the circumstances and merits of AAPL's application. AAPL submits that the Delegate erred in "regarding himself as bound to refuse [AAPL's] application if [Amrein] had not established that he held tertiary qualifications", and in finding that "the absence of tertiary qualifications was fatal to the application". However, this misrepresents Delegate's reasoning. He certainly considered that Amrein did not have the educational or industry qualifications specified in the Media Release. But this was not the end of his consideration of the application. As noted above, he went on to consider the other ASC policy documents, including Option 3 set out in the ASC/ISC Exposure Draft 5, and par 935 of the ASC Procedures manual, neither of which required a responsible officer, for the purposes of par 784 (2) (c), to hold tertiary qualifications. The Delegate was not satisfied that Amrein held any of the qualifications referred to in those policy documents or any qualification comparable to them. In those circumstances, while the Delegate was satisfied that Amrein had sufficient "industry experience", he held that Amrein's lack of any relevant educational (or industry) qualification was fatal to AAPL's application. The importance attached by the legislature to "educational qualifications" as criterion distinct from experience in the present context is emphasised by the change in the language of the statutory provision from the previous requirement (in par 48 (b) (iv) of the Securities Industry Code) that there be satisfaction as to the relevant officers' "educational qualifications or experience" to a requirement that there be satisfaction as to their "educational qualifications and experience". I do not see that the Delegate erred in concluding that Amrein's industry experience did not compensate for his lack of appropriate educational qualifications. While inconsistency can be found in the ASC's policy documents, this did not work to AAPL's detriment and could be viewed as having worked to its advantage, because the Delegate took the less rather than the more stringent formulations of the educational and experience requirements. For example, he took a formulation which did not insist upon a tertiary degree. In any event, inconsistency in the ASC's policy documents does not of itself constitute a ground on which the decision should be set aside. The question, again, is whether the course of decision-making discloses error, not whether the ASC's statements of policy are consistent. King Gee Clothing Co Pty Limited v Commonwealth (1945) 71 CLR 184, referred to by AAPL, related to the requirement of certainty of meaning in delegated legislation. It has no direct bearing on the present case, in which there is no question of the "validity" of the ASC's policies. This is not to say that shortcomings in policy documents on which an administrative decision is based may not affect the decision. For example, a policy might misrepresent or be inconsistent with a legislative requirement, and the decision might reflect that distortion. But despite inconsistencies that might be found in the ASC's various policy statements in this case, they all required that a responsible officer have a certain level of educational and industry qualification as well as certain industry experience. The approach of the Delegate reflected that policy, but was flexible. For example, the Delegate considered that it might be acceptable if Amrein had educational qualifications comparable to those referred to in the options described in the ASC/ISC Exposure Draft. While the Delegate was not prepared to allow Amrein's industry experience to overcome his lack of a relevant educational or industry qualification, his unwillingness to do so was in accordance with the terms of par 784 (2) (c). AAPL made two further submissions. First, it submitted that the use of the word "shall", rather than "may", in subs 784 (2) is significant. Whether or not this is correct, a condition precedent is that the ASC be satisfied as to the matters mentioned in par 784 (2) (c). Without fulfilment of the condition precedent, the statutory obligation does not arise. Second, reference was made to legislation relating to professions which prescribes the tertiary qualifications, or kinds of tertiary qualifications, that must be held as a condition of entry into the profession. However, while the Law does not contain a similar prescription in respect of a dealer in securities, this does not signify that no such qualification may be insisted upon. It may not be open to the ASC to prescribe particular qualifications that must be held by all applicants, but it is open to it to indicate kinds or levels of qualification that will be considered adequate. In this case, the Delegate considered whether Amrein held qualifications comparable to the kinds and levels of tertiary and industry qualifications considered by the ASC to be adequate and found that he did not. The Delegate was entitled to follow that course and to reach that conclusion. CONCLUSION For the above reasons, the application should be dismissed with costs. I certify that this and the preceding eighteen (18) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Lindgren Associate: Dated: 26 August 1998 Solicitor for the Applicant: Mr JGF Harrowell of Hunt and Hunt Solicitor for the Respondent: Mr PJ Stepek of the Australian Securities Commission Dates of Hearing: 5 March, 9 April, 11 May 1998 Date of Judgment: 26 August 1998