FEDERAL COURT OF AUSTRALIA Harbour Radio Pty Limited v Australian Communications and Media Authority [2012] FCA 439 Citation: Harbour Radio Pty Limited v Australian Communications and Media Authority [2012] FCA 439 Parties: HARBOUR RADIO PTY LIMITED (ACN 010 853 317) and MACQUARIE RADIO NETWORK LIMITED (ACN 063 906 927) v AUSTRALIAN COMMUNICATIONS AND MEDIA AUTHORITY (ABN 55 386 169 386) File number: NSD 595 of 2012 Judge: GRIFFITHS J Date of judgment: 27 April 2012 Legislation: Administrative Decisions (Judicial Review) Act 1977 (Cth) ss 5, 13 Broadcasting Services Act 1992 (Cth) s 125 Judiciary Act 1903 (Cth) ss 39B, 78B(5) Cases cited: Bienke v Minister for Primary Industries and Energy (1995) 63 FCR 567 Castlemaine Tooheys Limited v The State of South Australia (1986) 161 CLR 148 La Macchia v Minister for Primary Industries and Energy (1992) 110 ALR 201 Minister for Resources v Dover Fisheries Pty Limited (1993) 116 ALR 54 The State of South Australia v Tanner (1989) 166 CLR 161 Date of hearing: 27 April 2012 Place: Sydney Division: GENERAL DIVISION Category: No catchwords Number of paragraphs: 31 Counsel for the Applicants: T Blackburn SC Solicitor for the Applicants: Baker & McKenzie Counsel for the Respondent: N Williams SC Solicitor for the Respondent: Australian Government Solicitor IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 595 of 2012 BETWEEN: HARBOUR RADIO PTY LIMITED (ACN 010 853 317) First Applicant MACQUARIE RADIO NETWORK LIMITED (ACN 063 906 927) Second Applicant AND: AUSTRALIAN COMMUNICATIONS AND MEDIA AUTHORITY (ABN 55 386 169 386) Respondent JUDGE: GRIFFITHS J DATE OF ORDER: 27 APRIL 2012 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The application for interlocutory relief filed by the applicants on 27 April 2012 is dismissed. 2. The costs of the interlocutory application are the respondent's costs in the cause. 3. The parties prepare short minutes of order which should include directions addressing the requirements of s 78B of the Judiciary Act 1903 (Cth). 4. The proceeding be listed for hearing on 25 May 2012 at 10:15 am. 5. The parties have 48 hours liberty to apply. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011 IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 595 of 2012 BETWEEN: HARBOUR RADIO PTY LIMITED (ACN 010 853 317) First Applicant MACQUARIE RADIO NETWORK LIMITED (ACN 063 906 927) Second Applicant AND: AUSTRALIAN COMMUNICATIONS AND MEDIA AUTHORITY (ABN 55 386 169 386) Respondent JUDGE: GRIFFITHS J DATE: 27 APRIL 2012 PLACE: SYDNEY REASONS FOR JUDGMENT 1 These proceedings involve an application for judicial review under s 5 of the Administrative Decisions (Judicial Review) Act 1977 (Cth) (the ADJR Act) of a determination made by the Australian Communications and Media Authority (ACMA). The determination was to make a standard which is called the Broadcasting Services (Commercial Radio Current Affairs Disclosure) Standard 2012 (the Standard). The Standard is said to have been made under subs 125(1) of the Broadcasting Services Act 1992 (Cth) (the Act). ACMA determined to make the Standard on 14 March 2012. The Standard is scheduled to commence on 1 May 2012, it having been placed on the Legislative Instruments Register on 27 March 2012. 2 In the substantive proceedings, the applicants challenge ACMA's decision to determine the Standard on several grounds. Those grounds are set out in an amended application for judicial review which was filed in Court today. The grounds of challenge include excess of jurisdiction, lack of reasonable or rational proportionality and what might loosely be called Wednesbury unreasonableness. The applicants have also raised in their amended application an argument which, on its face, would appear to require steps to be taken in compliance with s 78B of the Judiciary Act 1903 (Cth). That arises from a proposed ground relating to a contention that the Standard impermissibly intrudes upon the implied constitutional freedom of discourse or communication on political or government matters. 3 The fact that s 78B notices would appear to be required does not prevent the Court proceeding today to deal with the interlocutory application having regard to the terms of subs 78B(5) of the Judiciary Act. 4 By way of interlocutory application, the applicants seek an order that ACMA's decision be stayed pending the resolution of the proceedings. In effect, the applicants are seeking to defer the commencement of the Standard which, as I have said, is scheduled to take place from 1 May 2012. It might be noted at the outset that the applicants were notified of ACMA's determination and the terms of the Standard by letter dated 21 March 2012. 5 On 12 April 2012 the licensee requested ACMA to provide a written statement of reasons under s 13 of the ADJR Act. I will return in due course to deal with that matter, including ACMA's response, which was by way of a letter dated 17 April 2012. It is to be noted, however, that the proceedings were not themselves commenced until 24 April 2012, approximately one week before the Standard was due to commence. 6 As noted above the amended application raises a constitutional issue. I have dealt with the fact that I believe that that does not preclude the Court from proceeding to deal with this application in circumstances where subs 78B(5) of the Judiciary Act permits the Court to proceed without delay to hear and determine proceedings so far as they relate to the grant of urgent relief of an interlocutory nature where the Court thinks it necessary in the interests of justice to do so. I consider that this is such a case and that while s 78B notices will need to be issued promptly that does not prevent the Court from dealing with the applicants' interlocutory application. 7 As noted above the applicants invoke the Court's jurisdictions under both the ADJR Act and s 39B(1A)(c) of the Judiciary Act. There is an issue as to whether the ADJR Act applies, and the respondent has filed in Court today an objection to competency raising the question whether that part of the Court's jurisdiction is available. When it needs to be decided – which is not now – that issue will turn largely on whether ACMA's determination or decision is a decision of an administrative character made under an enactment, as opposed to being a decision or determination of a legislative nature. ACMA does not, however, contest the Court's jurisdiction to deal with this interlocutory application or, indeed, the substantive issues under the alternative limb of the Court's jurisdiction under the Judiciary Act, to which I have made reference. 8 There is no significant difference between the parties as to the appropriate principles to apply in determining whether or not a stay should be granted. Those principles are broadly similar to – although I should add not necessarily identical with – the principles which apply to the grant of an interlocutory injunction. It is well established that the two primary principles or tests are whether there is a serious issue to be tried and where the balance of convenience lies. It is also important, in my view, not to lose sight of the fact that these proceedings are not in the nature of private litigation, rather they have a public law character. This is an important consideration when it comes to weighing the balance of convenience. All the more so, I might add, where one is dealing not only with public law litigation, but also with an application to stay the commencement of what, it is common ground, is a legislative instrument. 9 ACMA denies that any of the applicants' proposed grounds of review raise either a serious question to be tried or alternatively a strong serious question to be tried. I do not think it necessary for me to deal at length with each of the three grounds of review. There may be some force in ACMA's criticisms of grounds 1 and 3 set out in the amended application, but I need not deal with those matters now. At the current stage of these proceedings I am content that ground 2 at least raises a serious question to be tried, noting in particular that the applicants clarified during the course of oral argument that their reliance on the ground of proportionality extends beyond that ground as it applies to administrative action, but also encompasses proportionality as it relates to the validity of a legislative instrument such as the Standard. 10 In support of that ground of challenge, reference could be made to cases such as The State of South Australia v Tanner (1989) 166 CLR 161 at 167-8; Minister for Resources v Dover Fisheries Pty Limited (1993) 116 ALR 54 and Bienke v Minister for Primary Industries and Energy (1995) 63 FCR 567 at 578-9. 11 On the basis that in my view there is at least one of the applicants' grounds of review which raises a serious question to be tried, the next issue to which I now turn is the balance of convenience. The applicants argue that the balance of convenience weighs in their favour. Their grounds for so contending can be summarised as follows. 12 First, the applicants say it is not possible practically or operationally for the licensee to comply with that part of the Standard which, for convenience, has been referred to as the "all advertiser extension" (see subclause 5(2) and clause 8 of the Standard). The applicants further say that compliance would result in the licensee suffering significant loss of revenue and advertisers, not to mention the substantial compliance costs which it says it would be forced to undertake, and without any assurance that those steps would produce compliance. 13 ACMA contends that the applicants' evidence and claims relating to impossibility of compliance do not go as far as the applicants' case as put suggests. 14 ACMA contends that the complaints about compliance-burden find only the most limited support, if any, in the submission to ACMA of the peak body, Commercial Radio Australia, a copy of which has been adduced in evidence. Further ACMA says that the asserted difficulties of compliance for a limited period until an early hearing could be held do not provide an adequate basis for interlocutory relief being granted. 15 As noted above, in my view the weighing of the balance of convenience in this case has also to take into account the character of the Standard as a legislative instrument. There is a line of legal authority to the effect that a court should be wary about granting relief on an interlocutory basis which has the effect of preventing the operation of primary or delegated legislation. 16 The judgment of Mason ACJ in Castlemaine Tooheys Limited v The State of South Australia (1986) 161 CLR 148 at 155-156 is instructive in this regard. For convenience the relevant passages are now set out: In Canada the courts have taken the view that only in exceptional circumstances will an interlocutory injunction be granted to restrain enforcement of a statute challenged on constitutional grounds. In Morgentaler v. Ackroyd Linden J. said: ... the balance of convenience normally dictates that those who challenge the constitutional validity of laws must obey those laws pending the court's decision. If the law is eventually proclaimed unconstitutional, then it need no longer be complied with, but until that time, it must be respected and this court will not enjoin its enforcement. Such a course of action seems to be the best method of ensuring that our society will continue to respect the law at the same time as it is being challenged in an orderly way in the courts. This does not mean, however, that in exceptional circumstances this court is precluded from granting an interim injunction to prevent grave injustice, but that will be rare indeed. This approach was subsequently applied in Ziegler v. Hunter, and Pacific Trollers Association v. Attorney-General (Canada). It may be that the last sentence in the passage quoted from Morgentaler v. Ackroyd states the position too strongly against the plaintiff who seeks an interlocutory injunction in Australia. The decisions in this Court to which I have already referred demonstrate that there are a variety of situations in which the Court, on a proper balance of convenience, will restrain enforcement of a statute in aid of a plaintiff's constitutional right. In arriving at a balance of convenience the Court will take into account the seriousness of the conduct enjoined by the statute and the damage to the public interest that may be caused by restraining its enforcement. And in some cases the balance of convenience may be affected by the Court's perception or evaluation of the strength of the plaintiff's case for invalidity. But, subject to these qualifications there can be no reason to doubt the correctness of the general thrust of the comments in the passage which I have quoted. In the absence of compelling grounds, it is the duty of the Court to respect, indeed, to defer to, the enactment of the legislature until that enactment is adjudged ultra vires. 17 Castlemaine Tooheys involved a challenge to the validity of both primary and secondary legislation by reference to an allegation that the legislation offended s 92 of the Constitution. As I have already indicated, in the amended application here the applicants also raise a constitutional issue concerning the validity of the Standard by reference to the implied freedom of political communication. But it might also be noted that the principles stated by the Acting Chief Justice in Castlemaine Tooheys have been applied in this Court and in other courts to challenge the validity of legislative instruments on non-constitutional law grounds. Those cases include the decision of Burchett J in La Macchia v Minister for Primary Industries and Energy (1992) 110 ALR 201. 18 Of course, these proceedings involve challenges to the validity of the Standard not only on constitutional grounds in the way that I have described above, but also on other more orthodox grounds of challenge to the validity of delegated legislation or instruments bearing the characteristics or qualities of such legislation. 19 As I have mentioned, the Standard is due to commence on 1 May 2012. It applies to all commercial broadcasting licensees. As a condition of their licences such licensees will be obliged to comply with the Standard. Parliament plainly intended that to be the case by reference to the relevant provisions in the Broadcasting Services Act 1992 (Cth) relating to compliance with the conditions of commercial radio broadcasting licences. 20 There is also a clear public interest element underlying the Standard. Clause 6 of the Standard describes its object as: …being to encourage licensees to be responsive to the need for a fair and accurate coverage of matters of public interest by requiring the disclosure of commercial agreements or other arrangements that have the potential to affect the content of current affairs programs. 21 The public interest in ensuring that there is accuracy and fairness in news and current affairs programs is also reflected in the terms of paragraph 123(2)(d) of the Act, which relates to industry codes and practice. That aspect of the public interest is also effectively embedded in the Standard itself. 22 The public interest in this matter is further underlined by the fact that the Standard has now been registered on the Legislative Instruments Register since 27 March 2012 and there is, one can assume, a public expectation of the Standard coming into force on the scheduled date of 1 May 2012. 23 There is some force, in my view, in the respondent's criticisms of the applicants' evidence concerning the alleged impossibility of compliance. Assuming that the two presenters who hold shares in the parent company of the licensee retain those shares post 1 May 2012, the licensee will need to implement appropriate arrangements to ensure compliance with the Standard until such time as the Court rules on its validity. The Court has already indicated its availability to hear the substantive proceedings on 25 May 2012 and it is understood that that date is suitable to all the parties. 24 The licensee has emphasised the practical difficulties it says it faces in complying with the Standard, and in particular with that part of the Standard which relates to disclosure of commercial agreements caught by sub-clause 5(2) of the Standard, having regard to the significant number of its advertisers. The evidence demonstrates that there are currently some 906 small-spend advertisers who generate more than 50 per cent of the licensee's advertising revenue. The licensee has also emphasised the difficulty of it and its staff ascertaining in advance what issues are likely to arise in the course of a relevant talk-back program involving the two presenters who hold shares in the parent company, namely Mr Smith and Mr Hadley. The arrangements which the station will need to take to ensure compliance are, of course, ultimately a matter for it, but it can be expected that in determining what those appropriate arrangements are, the station would take into account the precise terms of sub-clauses 5(2) and 8 in the Standard. 25 A matter of particular concern to the licensee relates to the wording of subparagraph (iv) of clause 8.1(b.) That concerns the broadcast of material in a current affairs program which directly promotes an issue which is directly favourable to the sponsor. In my view it is important to both note and give full effect to the double-use of the qualifying expression "directly" in assessing what steps need to be taken to address that provision. 26 As to the applicants' evidence that hardship will also be encountered if the two presenters are forced to engage in what was described as a "fire sale" of their shares, I accept the contention of ACMA on that point that that is a hardship to the presenters, not a hardship to the licensee or parent company. 27 Other relevant aspects of the balance of convenience which, in my view, need to be taken into account concern the interests of third parties and the public generally, as well as the applicants' delay in commencing these proceedings. As to the first consideration, as I have already indicated the Standard was registered on the Legislative Instruments Register on 27 March 2012. It also appears that the commercial radio broadcasting industry was advised by ACMA of its determination and the terms of its Standard on or around 21 March 2012, assuming that all licensees were treated equally in that regard. The licensee has been aware since around 21 March 2012 of the fact that the Standard would commence on 1 May. And by no later than 27 March 2012, with the entry into the Legislative Register of the instrument, both the industry generally as well as members of the public must have become aware of that matter. 28 In my view, it would require compelling grounds of the sort described by the Acting Chief Justice in the Castlemaine Tooheys case to stop the Standard commencing on 1 May 2012. I do not consider that such compelling grounds have been made out here. It is especially important to note in this respect that the relief sought by the applicants is for a stay of the commencement of the Standard generally, not just the provisions which are of immediate concern to them. If relief were granted in that form it would mean that the public interest underlying the various other elements of the Standard – not the subject of immediate concern to the applicants here – would also not come into effect at the proposed time. I am referring to the provisions of the Standard which relate to such matters as the keeping of a register and provision of information to ACMA, as well as other changes that are made in that Standard apart from the all advertiser extension. 29 The second matter which has weighed heavily with me is the issue of the applicants' delay in commencing the proceedings. As I have already indicated the licensee has known since 21 March of the terms of the Standard and its proposed commencement date of 1 May 2012. It waited three weeks before a request was made of the ACMA to provide it with a statement of reasons under s 13 of the ADJR Act. I was told from the bar table that advice was obtained from junior counsel on 23 March. A decision was taken that the matter should involve senior counsel but apparently it was not until 5 April that that was able to occur. The practical difficulties of obtaining legal advice in some circumstances is well recognised, particularly when the Easter period looms, but where the applicants wish to obtain a stay of a legislative instrument, such as the Standard, it behoves them in my view to take all reasonable steps to obtain the legal advice they require as quickly as possible so that matters may be brought before the Court in a timely fashion. 30 As ACMA pointed out, if these proceedings had been commenced within a reasonable time after 21 March 2012 there was every chance that the substantive proceedings would have been disposed of by this date. The delay in seeking the statement of reasons was then further highlighted by the fact that the licensee sought to impose a deadline on ACMA for responding to its request not only for a statement of reasons under s 13 of the ADJR Act, but also its demand that an undertaking be proffered by the ACMA that it would not take enforcement action in respect of the relevant part of the Standard identified in the licensee's letter of 12 April 2012. Those demands were met with a response letter from the ACMA, which is dated 17 April, and was received by the licensee on 18 April, ie one day before the licensee's own imposed deadline. Notwithstanding that the applicants were therefore aware from at least 18 April of ACMA's position that they had no entitlement to a s 13 statement and that ACMA had also refused to proffer the undertaking that had been sought, there was yet a further delay of another week until 24 April – only one week before the Standard was due to commence – before these proceedings were initiated. 31 For all of the above reasons the orders of the Court are: 1. The application for interlocutory relief filed by the applicants on 27 April 2012 is dismissed. 2. The costs of the interlocutory application are the respondent's costs in the cause. 3. The parties prepare short minutes of order which should include directions addressing the requirements of s 78B of the Judiciary Act 1903 (Cth). 4. The proceeding be listed for hearing on 25 May 2012 at 10:15 am. 5. The parties have 48 hours liberty to apply. I certify that the preceding thirty-one (31) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Griffiths. Associate: Dated: 2 May 2012