FEDERAL COURT OF AUSTRALIA Wyong-Gosford Progressive Community Radio Inc v Australian Broadcasting Authority [2003] FCA 33 ADMINISTRATIVE LAW – Broadcasting – Application for community broadcasting licence – Five applicants for three available licences – Australian Broadcasting Authority ("ABA") allocated two licences and gave the three remaining applicants a further opportunity to provide additional information to enable ABA to allocate the licence to one of them – Without notice to other licence applicants, ABA permitted substitution of a new applicant and allocated licence to that applicant – Whether this course was permissible under the statute – Whether there was a breach of the obligations of natural justice – Whether ABA took into account irrelevant matter or failed to take into account relevant material. Broadcasting Services Act 1992: ss 82, 84, 85 Administrative Decisions (Judicial Review) Act 1977: s 5 WYONG-GOSFORD PROGRESSIVE COMMUNITY RADIO INC v AUSTRALIAN BROADCASTING AUTHORITY and GOSFORD CHRISTIAN BROADCASTERS LTD (trading as RHEMA FM) N 37 of 2003 WILCOX J 31 JANUARY 2003 SYDNEY IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY N 37 of 2003 BETWEEN: WYONG-GOSFORD PROGRESSIVE COMMUNITY RADIO INC APPLICANT AND: AUSTRALIAN BROADCASTING AUTHORITY FIRST RESPONDENT GOSFORD CHRISTIAN BROADCASTERS LTD (Trading as RHEMA FM) SECOND RESPONDENT JUDGE: WILCOX J DATE OF ORDER: 31 JANUARY 2003 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The application for review be allowed. 2. The decision of the first respondent, Australian Broadcasting Authority, to allocate to the second respondent, Gosford Christian Broadcasters Limited (trading as Rhema FM), Service Licence 1150186 be set aside. 3. The said first respondent pay to the applicant, Wyong-Gosford Progressive Community Radio Inc, its costs of this proceeding. 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 N 37 of 2003 BETWEEN: WYONG-GOSFORD PROGRESSIVE COMMUNITY RADIO INC APPLICANT AND: AUSTRALIAN BROADCASTING AUTHORITY FIRST RESPONDENT GOSFORD CHRISTIAN BROADCASTERS LTD (Trading as RHEMA FM) SECOND RESPONDENT JUDGE: WILCOX J DATE: 31 JANUARY 2003 PLACE: SYDNEY REASONS FOR JUDGMENT WILCOX J: 1 This is a challenge to a decision of the first respondent, Australian Broadcasting Authority ("the ABA"), to grant to the second respondent, Gosford Christian Broadcasters Ltd (trading as Rhema FM) ("Gosford"), a community broadcasting licence pursuant to Part 6 of the Broadcasting Services Act 1992 ("the Act"). The relevant licence was issued in respect of the Gosford area of New South Wales. It permits provision of a radio service on a frequency of 94.9 MHz on the FM band. The facts 2 The applicant, Wyong-Gosford Progressive Community Radio Inc ("PCR"), is a community radio station, staffed by volunteers from the local community, which has provided a radio service in the Wyong-Gosford area for approximately ten years. It has done this pursuant to a series of temporary community broadcasting licences ("TCBLs") issued mainly for frequency 93.3 MHz on the FM band, but since 22 November 2002 using frequency 94.9 MHz. During some of the ten-year period, PCR has been required to share use of the relevant frequency with one or more other temporary community broadcasting licensees. 3 On 29 May 2002 the ABA issued a news release stating it had "invited applications for three new community radio broadcasting licences to serve the Gosford area of New South Wales". The licences were "to provide services on 93.3 MHz, 94.1 MHz and 94.9 MHz on the FM band". 4 The news release gave a telephone contact number for information and stated that information was also available on the ABA's website. The release went on: "Applications for the Gosford licences must be received before 5.00 pm on Thursday 27 June 2002. From 11 July 2002, copies of all applications received will be placed for public perusal on the ABA's website. Copies of all applications received will also be made available for public perusal in the Gosford Central Library from 10 July 2002. The ABA welcomes written submissions from members of the public in relation to the applications received. Submissions should be lodged with the ABA by 5.00 pm on 25 July 2002. Submissions can also be lodged via email to info@aba.gov.au. Copies of any letters of support included with applications and subsequent support letters received by the ABA will not be displayed on the web site or in libraries. However, they will be made available for inspection on request at the ABA office in Sydney. Statistical data on these letters will be placed on the ABA's website." (Original emphasis and underlining) 5 The news release went on to provide some background information. This included the statement: "The ABA will decide if a licence is to be allocated and in the case of competing applicants, to which applicant". It also pointed out that the "ABA is not obliged to allocate a community broadcasting licence to an applicant even though the ABA has advertised for and received applications". 6 By 27 June 2002 the ABA had received five applications for the three available permanent licences. In accordance with the promise made in the ABA's news release, copies of all applications were made available for public perusal, both on the ABA's website and in the Gosford Central Library. Submissions were received. These were apparently made available to interested parties, including each of the five licence applicants. The various licence applicants apparently felt free to offer comments about each other's applications and did so, to some extent. 7 On 24 October 2002, the ABA allocated licences to two applicants, Five-O-Plus Public Radio Association Inc and Central Coast Broadcasters Ltd. This left three unsatisfied applicants, PCR, Radio Yesteryear Inc and Newcastle Christian Broadcasters Ltd (trading as Rhema FM) ("Newcastle"). 8 On the same day the ABA wrote to each of the unsatisfied applicants stating that, in relation to Service Licence ("SL") 1150186 (for the 94.9 MHz frequency) "the ABA reached a preliminary view not to allocate this licence, under s 85 of the Act, with the intention of allowing all applicants for this licence a further opportunity to provide additional information which may then enable the ABA to allocate the licence to one of the applicants". 9 Section 85 of the Act provides: "The ABA is not required to allocate a community broadcasting licence to any applicant." 10 The 24 October letter to PCR was addressed to PCR's Treasurer, Silvia Higgins. The letter went on to state "preliminary reasons" for the ABA's decision not to allocate SL1150186 to PCR. This section of the letter concluded with an invitation: "In order to assist the ABA in allocating this licence SL1150186, the ABA invites you to provide relevant information which addresses the reasons given by the ABA not to allocate the licence to [PCR] by 21 November 2002." (Original emphasis) 11 The letters to Radio Yesteryear and Newcastle are not in evidence, but argument before me proceeded on the basis that they were similar to that sent to PCR, subject only to the fact that they each gave preliminary reasons in respect of the application of the particular addressee. 12 On 19 November 2002, Ms Higgins responded with a submission on behalf of PCR that addressed each of the matters raised by the ABA. Although this was not specifically invited, the submission also included "comments about the comparative merits of the applicants". The comments concerning Newcastle raised issues about the origin of programs and the issue of local control. The submission stated: "Radio Rhema [ie Newcastle] quite clearly states that most of their programs will be similar if not identical to the ones emanating from Newcastle. The local content appears secondary. In effect it appears that programs may only be relayed to the local area. Where the issue becomes clouded is that the 'local' Radio Rhema comes under the governance of a Constitution that covers the Newcastle and the Hunter regions and other such locations as deemed desirable to broadcast. How can one 'ensure' that the local Branch has a say if decisions reside in the constitutional hands of the voting members outside the Central Coast area? It is obvious to us that constitutional constraints will not allow independent control of the so called local station." 13 However, unbeknown to Ms Higgins or PCR, the identity of "Radio Rhema" had changed. On 29 November 2002, Gina Herro of the Licensing Section of ABA wrote the following letter to Ms Higgins: "I am writing in regard to the community radio broadcasting licence SL1150186 to serve Gosford. On 1 November 2002, the ABA Chairman, Professor David Flint, approved a request from Newcastle Christian Broadcasters Limited to provide additional information in the form of a fresh application from a new legal entity for SL1150186 by 2 December 2002. On 28 November 2002, the ABA received an application from Gosford Christian Broadcasters Limited for the Gosford licence SL1150186. A copy of this application has been posted on the ABA's website. If you wish to discuss this matter further, you may contact me on (02) 9334 7827 or freecall 1800 226 667." 14 The evidence before the Court establishes that the new licence applicant, Gosford (the second respondent to this proceeding), was registered under the Corporations Act 2001 on 22 November 2002, after Professor Flint's decision. On 28 November 2002 the new company lodged an application for SL1150186. It provided some fresh information to the ABA but relied substantially on information previously submitted by Newcastle, in support of its application. This statement is particularly true in respect of letters of support, many of which were addressed to Newcastle and all of which were previously submitted to the ABA by Newcastle. 15 The secretary of PCR, Norbert Lindberg, made an affidavit that contained the following paragraph: "At no time was the Applicant, Wyong-Gosford PCR given an opportunity to respond to the decision made by Professor David Flint to approve a fresh application being submitted by a new legal entity. I was under the impression that the deadline of 22 November 2002 for any further reasons from the Applicant had expired and that the Applicant, Wyong-Gosford PCR was not able to provide any further information." 16 Although Mr Lindberg was available for cross-examination, counsel for neither of the respondents chose to cross-examine him. 17 On 23 December 2002, the ABA wrote to PCR stating that, on 19 December, it had decided to allocate SL1150186 to Gosford. Reasons were given. They included the statement "that Rhema FM has demonstrated through its large membership level and letters of support that there is substantial interest and support for its proposed service". 18 The letter indicated that, as SL1150186 has been allocated to commence from 1 February 2003, "no further TCBLs will be allocated in the Gosford licence area beyond that date". 19 On behalf of PCR, Mr Lindberg immediately requested access to Gosford's supporting documents. No doubt because of the Christmas break, there was a short delay in their being made available. PCR obtained legal advice and, on 15 January 2003, commenced the present proceeding. Pursuant to an order by Madgwick J, as duty judge, it was fixed for final hearing before me on 28 January 2003. The reason for the urgency, of course, is that the effect of the ABA's decision, if legally valid, is that there will be no alternative to PCR terminating its broadcasting service – and thereby effectively its operations – on 31 January 2003. The application 20 PCR's filed application is based upon the Administrative Decisions (Judicial Review) Act 1977 ("the ADJR Act"). It invokes three grounds: breach of the rules of natural justice (ADJR Act s 5(1)(a)), taking into consideration an irrelevant consideration (ADJR Act s 5(2)(a)) and failing to take into consideration a relevant consideration (ADJR Act s 5(2)(b)). 21 Particulars of these grounds were supplied. The Act 22 Before turning to the arguments of counsel, it is desirable for me to say something about Part 6 of the Act. 23 Part 6 comprises ss 79 to 92 inclusive. Section 79 contains a wide definition of "company" and s 79A makes clear that the Part does not apply to temporary community broadcasting licences. Section 80 reads: "(1) Where the ABA is going to allocate one or more community broadcasting licences that are broadcasting services bands licences, the ABA is to advertise, in a manner determined by the ABA, for applications from companies that: (a) are formed in Australia or in an external Territory; and (b) represent a community interest. (2) The advertisements are to include: (a) the date before which applications must be received by the ABA; and (b) a statement specifying how details of: (i) the conditions that are to apply to the licence; and (ii) the licence area of the licence; and (iii) any priorities that the Minister has, under subsection 84(1), directed the ABA to observe in the allocation of that licence or those licences; can be obtained. (3) Applications must be in accordance with a form approved in writing by the ABA." 24 Section 81 relates to a corporate applicant that is disqualified for particular reasons. It is irrelevant to this case. Sections 82 and 83 are also presently irrelevant. 25 Section 84(1) empowers the Minister to give directions to the ABA to give priority to a particular community interest or interests. It seems no relevant direction has been given. 26 Section 84(2) says that "[i]n deciding whether to allocate a community broadcasting licence that is a broadcasting services bands licence to an applicant or to one of a group of applicants, the ABA is to have regard to" six specified matters. 27 As previously mentioned, s 85 absolves the ABA from any requirement to allocate a community broadcasting licence. Sections 86 to 88 inclusive relate to conditions and ss 89 to 92 inclusive to renewal of licences. 28 The scheme of Part 6 gives rise to an issue of construction that was not raised in PCR's filed application or written submissions but was discussed in the course of oral argument. The issue is whether it is open to the ABA to receive, and act upon, an application for a community broadcasting licence that is not submitted pursuant to an advertisement of the ABA under s 80 of the Act and, in particular, by the date specified in the advertisements. Ms R Henderson, counsel for the ABA, argued it was open to her client to do this, there being no specific statutory prohibition on this course being followed. However, I do not think her argument can be accepted; I think it is inconsistent with the statutory scheme. 29 It will be noted that s 80(1) provides that, where the ABA is going to allocate one or more broadcasting licences, it "is to advertise" for applications. There is a requirement for advertising before allocation. Moreover, by s 80(2), the advertisements "are to include" certain information, including "the date before which applications must be received by the ABA". The notion is that the ABA will publicise the fact that a licence is, or licences are, available for allocation and will call for applications, for that licence or those licences, before a particular date and containing specified information. Section 80 uses mandatory language. 30 Section 84(2) specifies the criteria to be considered by the ABA in deciding whether to allocate a licence "to an applicant or one of a group of applicants". That must be a reference to a person who has, or persons who have, made application for the licence in the manner prescribed by s 80. 31 Although Part 6 does not contain a provision specifically empowering the ABA to allocate a licence, it is clear it has power to do this; but subject to s 84(2). In other words, after having regard to the matters listed in s 84(2), the ABA has power to allocate a licence to a company that complies with the requirements of s 80. As I see the position, it has no power to allocate a licence to a person or company that has not complied with those requirements. 32 The construction I favour makes sense in policy terms. The radio spectrum is a finite resource. There is not room for everybody who might wish to provide a service. Choices must be made between competing candidates, all of whom may be able to comply with the Act's requirements. In such a situation, it seems only fair and sensible to require a public invitation to submit applications by a particular date and for the ABA to facilitate discussion about the merits of the various applications – including debate between competing applicants – before it makes a choice between those applicants. 33 In the present case, it is urged there is a substantial correspondence between the programs proposed to be offered by Gosford and those forecast in the Newcastle application. That may be so, but it cannot affect the proper construction of the Act. Anyway, the suggested similarity cuts both ways. The material may show a degree of support for "Christian programs", but it also raises questions about the extent of local content and local control. Natural justice 34 PCR's filed application identified two strands to its argument that the decision of the ABA to allocate SL1150186 to Gosford constituted a breach of the rules of natural justice: (i) PCR was not given the opportunity to make submissions on the ABA's decision to accept a new application after applications had closed; (ii) PCR was not given the opportunity to make further representations after the acceptance of Gosford's application. 35 It is common ground that point (i) is factually correct. Prior to Professor Flint's decision, PCR was given no intimation of the possibility that the ABA would permit a new applicant to enter the contest for the remaining available licence. The first that PCR heard about this was when Ms Higgins received Ms Herro's letter of 29 November 2002, that letter being dated four weeks after Professor Flint's decision. 36 There is a dispute about the factual correctness of point (ii) above. Ms Henderson referred to the final sentence of Ms Herro's letter. It contained an invitation for Ms Higgins to contact Ms Herro if she wished "to discuss this matter further". However, I think this hardly amounted to an invitation to provide submissions about the merit of Gosford's application. If the ABA had intended to extend such an invitation, it surely would have made this clear, especially having regard to the fact that the previously-fixed deadline had passed. 37 Both Ms Henderson and Mr Ian Davidson, counsel for Gosford, concede that the ABA was under a duty to provide procedural fairness to PCR. That concession was correctly made. The situation in the present case is clearly covered by what Mason J, in Kioa v West (1985) 159 CLR 550 at 582, called "a fundamental rule of the common law doctrine of natural justice expressed in traditional terms"; namely "that, generally speaking, when an order is to be made which will deprive a person of some right or interest or the legitimate expectation of a benefit, he is entitled to know the case sought to be made against him and to be given an opportunity of replying to it". 38 Mason J went on (at 583) to refer to decisions that "demonstrate that the concept of 'legitimate expectation' extends to expectations which go beyond enforceable legal rights provided that they are reasonably based". He said: "The expectation may be based on some statement or undertaking on the part of the authority that makes the relevant decision". His Honour added that, alternatively, "the expectation may arise from the very nature of the application … or from the existence of a regular practice which the person affected can reasonably expect to continue". 39 As it seems to me, the present case includes all three sources of legitimate expectation mentioned by Mason J. In its original news release, the ABA indicated that applications for the available licences must be lodged by 27 June 2002. There was a clear suggestion that only applications complying with this requirement would be considered. The applications were to be made publicly available. Written submissions from members of the public were invited. There was to be an open debate about the merits of the applications. 40 Further, the letter from the ABA to Ms Higgins of 24 October 2002 invited PCR to submit further information "which may then enable the ABA to allocate the licence to one of the applicants". This was an explicit statement that, in this round, the licence would be allocated (if at all) only to one of the three remaining original applicants. It was on that basis that PCR was being asked to provide further information, which had to be received by the ABA by 21 November. 41 The nature of the application appears from the statutory context, which I have already analysed. It is clearly one pointing to the application of the "fundamental rule" identified by Mason J. And (as reported cases show) there has been a long-standing practice by the ABA (and its predecessor, the Australian Broadcasting Tribunal) of calling for applications for a particular licence by a particular date and allowing a period for submissions, including submissions by one applicant that are critical of a competing application. 42 Ms Henderson referred to Alphapharm Pty Limited v Smithkline Beecham (Australia) Pty Limited (1994) 49 FCR 250, a Full Court decision denying the standing of a drug company to request the Minister to reconsider the registration of a competitor's product under the Therapeutic Goods Act 1989. Being a case about standing under a different Act, the decision is of limited present assistance. However, it is pertinent to observe that (at 258-261) Davies J discussed the interplay between standing and the question whether a person's "interests are affected". In connection with the latter point, he quoted from Mason J in Kioa v West, including a reference to what his Honour went on to say at 584: "The law has now developed to a point where it may be accepted that there is a common law duty to act fairly, in the sense of according procedural fairness, in the making of administrative decisions which affect rights, interests and legitimate expectations, subject only to the clear manifestation of a contrary statutory intention. … But the duty does not attach to every decision of an administrative character. Many such decisions do not affect the rights, interests and expectations of the individual citizen in a direct and immediate way. Thus a decision to impose a rate or a decision to impose a general charge for services rendered to ratepayers, each of which indirectly affects the rights, interests or expectations of citizens generally does not attract this duty to act fairly. This is because the act or decision which attracts the duty is an act or decision: '… which directly affects the person (or corporation) individually and not simply as a member of the public or a class of the public. An executive or administrative decision of the latter kind is truly a "policy" or "political" decision and is not subject to judicial review.'" 43 The decision of Professor Flint to admit Gosford as an applicant for SL1150186 was a decision that affected the rights, interests and expectations of PCR in a "direct and immediate way". PCR was affected "individually and not simply as a member of the public or a class of the public". Supposing (contrary to my opinion) that it was open to the ABA to accept Gosford's late application, the ABA was under an obligation of natural justice to give PCR the opportunity of putting submissions to it upon the question whether it ought to do so. It was also under an obligation to provide to PCR a reasonable opportunity to consider the material advanced by Gosford in support of its application and to put to it submissions in relation thereto. 44 Ms Henderson resisted this view on the basis that PCR was not affected by the ABA's treatment of Gosford's application. That may be the case where there is no limit upon the number of licences that can be granted. For example, a person would not normally be affected, in any sense covered by the rules of natural justice, by the decision of a traffic authority to grant another person a driver's licence. But where there is a finite number of available licences, so that applicants are effectively in competition for them, a concession to one applicant may affect the rights, interests or legitimate expectations of others. 45 In my opinion the first ground of review is made out. Taking into account irrelevant considerations 46 In his written submissions, Mr A L Hill, counsel for PCR, said: "The essence of this ground is that [the ABA] took into account the documents that were filed in support of [Newcastle's] application when it made its decision regarding [Gosford's] application." 47 The letter of the ABA dated 23 December 2002 indicates the ABA did take into account material originally filed by Newcastle. The letter specifically refers to "letters of support" and these were all originally provided by Newcastle. However, I do not think this made the material irrelevant. The letters of support mainly addressed the matter of program content; they were supportive of "Christian programs". That was a theme common to the applications of both Newcastle and Gosford. It was open to Gosford to adopt this material, as support for its own application. It was for the ABA to determine the extent (if any) to which it should be discounted because of its provenance. This ground is not made out. Failing to take account of relevant consideration 48 Mr Hill complained the ABA failed to take into account the Code of Practice of the Community Broadcasting Association of Australia, as it was obliged to do, he said, under s 158 of the Act. He also contended the ABA failed to take into account the intention underlying community broadcasting licences, as apparent from the Explanatory Memorandum to the Bill which resulted in the Act. Further, he said, the ABA failed to take into account the fact that Newcastle's programs, broadcast from the Newcastle arena, "can be heard in the Wyong Gosford area". There is evidence that they can be heard in some locations, at least, in the Wyong Gosford area. 49 The short answer to these contentions is that there is no evidence the ABA failed to take into account any of the identified material. There is no evidence as to what was before the ABA when it made its decision; indeed, there is no evidence of the circumstances of that decision or of the identity of the persons who participated in it. I reject this ground of challenge. Disposition 50 Despite my view that it was not open to the ABA to accept Gosford's application when it did, I do not rest my decision upon that view. I take that course because this was not a ground raised by PCR in its filed application. However, natural justice was clearly raised and that ground is made out. The application for review must be allowed and the decision of the ABA to grant the licence to Gosford must be set aside. PCR should have its costs of the proceeding but only as against the ABA. It was the ABA, rather than Gosford, which caused the problems giving rise to the invalidity of the decision and the ABA, rather than Gosford, was the principal opponent of PCR's claim for relief. 51 The effect of my order is that, contrary to the ABA's expectation when it wrote to PCR on 23 December 2002, SL1150186 will not commence operation on 1 February 2003. That means there is scope for one or more further temporary community broadcasting licences to be issued, in order to use the frequency pending a new permanent allocation. Whether that course should be taken is a matter for the ABA to determine. I certify that the preceding fifty-one (51) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Wilcox. Associate: Dated: 31 January 2003 Counsel for the Applicant: Mr A L Hill Solicitor for the Applicant: Tzovaras Legal Counsel for the First Respondent: Ms R M Henderson Solicitor for the First Respondent: Australian Government Solicitor Counsel for the Second Respondent: Mr I D Davidson Solicitors for the Second Respondent: Emil Ford & Co Date of Hearing: 28 January 2003