FEDERAL COURT OF AUSTRALIA Kamha v Australian Prudential Regulation Authority [2007] FCA 1422 ADMINISTRATIVE LAW – judicial review of a decision by the Australian Prudential Regulation Authority – reconsideration following appeal to be conducted in light of current circumstances – nature of judicial discretion under s 16 of the Administrative Decisions (Judicial Review) Act 1977 (Cth) – consideration of prejudice to applicant – consideration of public interest – consideration of full merits review as a suitable alternative remedy INSURANCE – decision of the Australian Prudential Regulation Authority to disqualify a person from being or acting in various capacities pursuant to s 25A of the Insurance Act 1973 (Cth) – appropriate methods of challenge to decision Administrative Decisions (Judicial Review) Act 1976 (Cth), s 10, s 16 Insurance Act 1973 (Cth) s 25A, s 63 Kamha v Australian Prudential Regulation Authority (2005) 146 FCR 24related Kamha v Australian Prudential Regulation Authority [2005] FCA 688related Kamha v Australian Prudential Regulation Authority (2005) 147 FCR 516 considered Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 cited Boral Gas (NSW) Pty Ltd v Magill (1993) 32 NSWLR 501 cited Du Pont (Aust) Ltd v Comptroller-General of Customs (1993) 30 ALD 829, [1993] FCA 187 followed Lamb v Moss (1983) 49 ALR 533, (1983) 76 FLR 296, (1983) 5 ALD 446 cited McGowan v Migration Agents Registration Authority (2003) 129 FCR 118 followed NAUV v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 79 ALD 149, [2003] FCA 1319 followed New South Wales Bar Association v Stevens (2003) 52 ATR 602, [2003] NSWCA 95 cited Re Refugee Tribunal; Ex parte Aala (2000) 204 CLR 82 cited Re VBJ and Australian Prudential Regulation Authority (2005) 87 ALD 747, (2005) 60 ATR 1013 referred to Saitta Pty Ltd v Commonwealth (2000) 106 FCR 554 followed Seymour v Attorney-General (Cth) (1984) 4 FCR 498 cited Stack v Commissioner of Patents (1999) 161 ALR 531cited Swan Portland Cement Ltd v Comptroller-General of Customs (1989) 25 FCR 523cited Tooth & Co Ltd v Parramatta City Council (1955) 97 CLR 492 cited ASHRAF IBRAHIM HELMY KAMHA v AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY AND DARRYL ROBERTS NSD 271 OF 2005 GYLES J 13 september 2007 SYDNEY IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY NSD 271 OF 2005 BETWEEN: ASHRAF IBRAHIM HELMY KAMHA Applicant AND: AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY First Respondent DARRYL ROBERTS Second Respondent JUDGE: GYLES J DATE OF ORDER: 13 SEPTEMBER 2007 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The application is dismissed. 2. The applicant's motion of 4 August 2006 is dismissed and the applicant is to pay the costs of the respondents of that motion. 3. The applicant is to pay the costs of the respondents of the proceeding and of the respondents' motion for summary dismissal, but each party should bear its own costs up to 14 March 2005. 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 NSD 271 OF 2005 BETWEEN: ASHRAF IBRAHIM HELMY KAMHA Applicant AND: AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY First Respondent DARRYL ROBERTS Second Respondent JUDGE: GYLES J DATE: 13 september 2007 PLACE: SYDNEY REASONS FOR JUDGMENT 1 On 22 April 2005 I delivered judgment in this proceeding (Kamha v Australian Prudential Regulation Authority (2005) 146 FCR 24). Orders reflecting the result were made on 27 April 2005 (Kamha v Australian Prudential Regulation Authority [2005] FCA 688). On 30 November 2005 the Full Court allowed an appeal, ordered that the orders made on 27 April 2005 should be set aside and remitted the matter to me for reconsideration (Kamha v Australian Prudential Regulation Authority (2005) 147 FCR 516). That reconsideration has been delayed by reason of an appeal to the High Court in related proceedings (X v Australian Prudential Regulation Authority (2007) 226 CLR 630). This is that reconsideration. The case concerns a challenge under the Administrative Decisions (Judicial Review) Act 1977 (Cth) (the ADJR Act) to a decision by the Australian Prudential Regulation Authority (APRA) to disqualify the applicant pursuant to s 25A of the Insurance Act 1973 (Cth). I will assume a familiarity with the history and circumstances of the case, the statutory background and the prior judgments in framing these reasons. 2 On 9 June 2006 counsel for the applicant submitted that the reconsideration is limited to consideration of the applicant's grounds of attack upon the decisions in question that were not dealt with in my prior judgment on their merits. Put another way, it is submitted that the Full Court decision precludes any discretionary refusal of relief or summary dismissal as the case presently stands. 3 I rejected that submission and indicated that, in my opinion, the remittal includes exercise of the discretion whether or not to grant relief under s 16 of the ADJR Act. The Full Court dealt with the discretion issue in Kamha 147 FCR 516 at [76]–[90]. The existence and possible application of the s 16 discretion was affirmed. The Full Court did not purport to exercise that discretion for itself. The Full Court decision does not preclude the application of the Federal Court Rules, including those relating to summary dismissal. The order of remittal is not limited in any way and cannot be read down. The result of the Full Court appeal is that only ground 1(b) in respect of the satisfaction decision and ground 2(b) in respect of the discretionary decision in the further amended application have been disposed of. All of the remaining grounds are open, subject to the limitations arising out of what the Full Court had to say under the heading "Reasons for deciding to disqualify". The reconsideration must be conducted in the light of the circumstances that exist at the present time. I propose to reconsider the issue of discretion before moving to complete the hearing of the remaining issues on the merits. Certain events occurring after the previous decision now need to be taken into account. 4 The Administrative Appeals Tribunal (the AAT) has now held that it is appropriate to make orders ensuring that an applicant's identity is not disclosed in the course of proceedings before it and that APRA can be restrained from publishing a notice relating to, or in any other way revealing, its decision (Re VBJ and Australian Prudential Regulation Authority (2005) 87 ALD 747, (2005) 60 ATR 1013). That supplements the topic referred to in Kamha 146 FCR 24 at [44]. Whether it is appropriate to now make such orders in this case, with its history, would be a matter for the AAT. 5 The applicant has now been charged with two offences, firstly, that he did not act honestly in exercise of powers and discharge of duties as an officer of FAI General Insurance Co Limited and, secondly, that being an officer was privy to the fraudulent altering of a database of that company. Those charges obviously involve an overlap with the subject matter of the present proceedings. The charges have been preferred in open Court and there has been newspaper publicity about them. This adds to the point discussed in Kamha 146 FCR 24 at [43]. 6 The Full Court appeal in this case was argued in public and the judgment of the Full Court is public. It has been available on the Court's website since shortly after it was delivered. It has been reported. The remitted proceeding has been argued in public. This judgment will be public. The fact that APRA has decided to disqualify the applicant is well and truly in the public domain by reason of his choice in bringing this proceeding. 7 It is clear enough that, if the inevitable disqualification had taken place, the applicant could have exercised the internal review and made an application to the AAT for an immediate stay and thereafter maintained confidentiality through that process and any consequent appeal to the AAT. Counsel for the applicant naturally sought to rely upon what was said by the Full Court as to "status" (see Kamha 147 FCR 516 at [85]). "Status" is an unusual way of describing an administrative disqualification that is stayed and is subject to full confidential internal and external review on the merits. Even in the case of bankruptcy by court order, a successful appeal means that it is as if sequestration had never occurred (de Robillard v Carver (2007) 159 FCR 38 per Buchanan J at [141]–[150], agreed with by Moore and Conti JJ at [1]). Reliance is also placed upon the statement "that may be a matter of prejudice…" (Kamha 147 FCR 516 at [85]). No fact or circumstance indicating potential prejudice is identified. I cannot discern any. Nonetheless, I will take into account the possibility of some unidentified prejudice by reason of the statutory process being followed to decision by the AAT. 8 The judicial discretion under s 16 as to whether or not to grant relief is at large, even where a case for relief is made out (Lamb v Moss (1983) 49 ALR 533, (1983) 76 FLR 296, (1983) 5 ALD 446; Seymour v Attorney-General (Cth) (1984) 4 FCR 498; Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 per Mason CJ at 338–339, agreed with by Brennan J at 365 and Deane J at 369). There are no mandatory criteria. A factor is only irrelevant to exercise of discretion if it is contrary to the purposes of the section read in its context in the ADJR Act. 9 Full internal and external merits review of a disqualification is available pursuant to s 63 of the Insurance Act. The existence of a suitable alternative remedy is a well established basis for the refusal for administrative law relief, whether under the ADJR Act or at common law. Section 10 of the ADJR Act, particularly s 10(2)(b)(ii) reflects that principle. (Tooth & Co Ltd v Parramatta City Council (1955) 97 CLR 492 at 497–498 per Dixon CJ; Re Refugee Tribunal; Ex parte Aala (2000) 204 CLR 82 at [5] per Gleeson CJ, [40]–[79] per Gaudron and Gummow JJ, [145]–[150] per Kirby J and [172] per Hayne J; Swan Portland Cement Ltd v Comptroller-General of Customs (1989) 25 FCR 523.) For obvious reasons, full merits review is generally a more suitable remedy than an administrative law challenge except, for example, where there is a clearly identified question of jurisdiction or power or other legal objection that can be decided without significant fact finding and is appropriate for decision by a court (Du Pont (Aust) Ltd v Comptroller-General of Customs (1993) 30 ALD 829, [1993] FCA 187; NAUV v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 79 ALD 149, [2003] FCA 1319 at [49] citing New South Wales Bar Association v Stevens (2003) 52 ATR 602, [2003] NSWCA 95 at [13] per Spigelman CJ; Boral Gas (NSW) Pty Ltd v Magill (1993) 32 NSWLR 501 particularly per Kirby P at 508–509; Stack v Commissioner of Patents (1999) 161 ALR 531 at [12]–[13]). The points argued and decided in this and the related case already (including the point involved in the High Court proceeding) illustrate such questions. As consideration of [79]–[83] of the Full Court judgment (Kamha 147 FCR 516) makes clear, it is only the barest of technicalities which prevented s 10(2)(b)(ii) from being directly applicable. That does not limit the relevance of similar considerations in exercise of the discretion under s 16. 10 The remaining grounds in this case require findings of fact and law. The evidence for the respondent, together with final submissions, will take some days and cannot be heard this year. A judgment will then take some time to deliver. The full merits review that has been and is available in the AAT provides the applicant with a remedy capable of taking account of all legitimate concerns about the decisions, including matters of process and substance, that are involved in the remaining grounds before the Court. 11 Furthermore, there is more at stake than the interests of the applicant. There is a public interest in disqualification of unsuitable persons in this field and in the timely consideration of that issue by the statutory regulator. Indeed, there is a public interest in the timely administration of the Insurance Act 1973 (Cth). Collateral administrative law challenges have the capacity to seriously interfere with the process. This case is a good example. The findings of the Royal Commission that sparked the issue were made in April 2003 based upon evidence given in public many months before that and related (so far as is relevant) to events up to September 1998. Furthermore, the applicant could pursue the remaining grounds in this case and then, if he loses and is formally disqualified (putting aside the possibility of appeals), exercise the internal and external rights of review. If no interlocutory injunction had been granted and undertakings given by APRA, the merit reviews which would have been open to the applicant would have been completed well before now. The tendency to mount collateral administrative law challenges to decisions where full merits review is available rather than deal with the substance of a case on review is becoming a more common phenomenon (eg Syngenta Crop Protection Pty Ltd v Commissioner of Taxation (2005) 61 ATR 186, [2005] FCA 1646). 12 There is also a public interest in proper use of the resources of the Court. There is no good reason that those significant public resources should be devoted to hearing the balance of this case, to the disadvantage of other litigants, where the issues are far better determined by the AAT – the body chosen by Parliament to review the substantive decisions in question. Among other things, the AAT can be taken to have specialist expertise that this Court does not and is not bound, as is a Ch 3 Federal court, by rules of evidence, practice and procedure. 13 All in all, the balance lies firmly in favour of declining relief, whatever the merits of the remaining grounds, and this proceeding should be brought to a halt, leaving the applicant to his statutory rights of review. The unresolved grounds can be regarded as summarily dismissed for reasons outlined in Du Pont (Aust) Ltd 30 ALD 829, [1993] FCA 187; Saitta Pty Ltd v Commonwealth (2000) 106 FCR 554; and McGowan v Migration Agents Registration Authority (2003) 129 FCR 118. There is no need to make formal orders to that effect on the motion or otherwise as no other basis for relief remains. The appropriate order is that the proceeding be dismissed. These reasons explain the bases for that order. 14 The question of costs is not without its complications. The issues in the case that were argued and finally dealt with were all ultimately decided in favour of the respondents, either because of my orders or the orders of the Full Court. The respondents are entitled to the costs of those issues. The remaining issues are in a different category. They have not been determined on the merits. The motion for dismissal that has succeeded was not filed until 14 March 2005. The applicant elected to push on regardless and lost. Assessment and apportionment of costs attributable to particular grounds of the application for particular periods of time would be very difficult. In my opinion, the proper order for costs is that the applicant should pay the general costs of the proceeding and of the respondents' motion for dismissal but that each party should bear its own costs up to 14 March 2005. The applicant's motion to amend to rely upon s 6N of the Royal Commissions Act 1902 (Cth) should be formally dismissed and the applicant should pay the costs of and incidental to that motion. I certify that the preceding fourteen (14) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gyles. Associate: Dated: 13 September 2007 Counsel for the Applicant: 9 June 2006 – Mr AJL Bannon SC, Mr P Zappia 15 and 18 August 2006 – Mr AJL Bannon SC 28 March 2007 – Mr GT Bigmore QC Solicitor for the Applicant: Varrasso & Associates Counsel for the Respondents: 9 June 2006 – Mr A Robertson SC, Ms M Fisher 15 and 18 August 2006 – Ms L McCallum 28 March 2007 – Ms M Fisher Solicitor for the Respondents: Australian Government Solicitor Dates of Hearing: 9 June, 15 and 18 August 2006 and 28 March 2007 Date of Judgment: 13 September 2007