Hot Topics Seminar: Commonwealth Compensation
Sydney, 25 November 2016
WHAT IS A QUESTION OF LAW FOLLOWING HARITOS V FEDERAL COMMISSIONER OF TAXATION?
The Hon Justice Duncan Kerr Chev LH*
1	Chief Justice Gleeson, in Plaintiff S157/2002 v Commonwealth, cited Denning LJ regarding the necessity of judicial oversight:
If tribunals were to be at liberty to exceed their jurisdiction without any check by the courts, the rule of law would be at an end. 
2	Lord Denning’s concern that unchecked tribunals might bring the rule of law to an end may seem outdated. The tone of his observation certainly reflects the scepticism of a previous age when tribunals were novel. They were then viewed as potential rivals of the judiciary. As creatures of the executive their capacity fairly to affect rights was doubted. 
3	In today’s quite different legal environment in which government decision making has become more complex and merits review of administrative decisions by independent tribunals has proved greatly beneficial, the concerns of that earlier age can appear exaggerated, perhaps even quaint. However in quite recent times the Commonwealth Parliament sought to exclude judicial review of certain tribunal decisions in order to clothe them with finality. However, in the aftermath, it has been clearly established that in Australia judicial supervision of the lawfulness of executive action sits on a firm constitutional foundation. 
4	The Administrative Appeals Tribunal (AAT) has jurisdiction conferred on it by over more than 400 pieces of Commonwealth legislation. With the recent amalgamation with the Migration Review Tribunal-Refugee Review Tribunal and the Social Security Appeals Tribunal, the AAT has evolved to be closer to the original aspiration of the Kerr Report of 1971 for a single comprehensive merits review tribunal responsible for all Commonwealth administrative review.  
5	The work of the AAT is invaluable. However, as is the case of the decision makers whose decisions it reviews, the AAT is a human institution. It is not immune from error. 
6	From its inception a disappointed review applicant in the AAT could exercise a statutory appeal to the Federal Court. Section 44 of the Administrative Appeals Tribunal Act 1975 (Cth) (AAT Act) vests jurisdiction in the Federal Court of Australia to hear and determine appeals from a decision of the AAT on a question of law. 
7	What, in this context, is a question of law? For more than 30 years this seemingly simple question was the focus of much judicial attention. Differences in approach emerged. Those differences remained stubbornly resistant to being settled. However, last year a Full Court of the Federal Court of Australia, exceptionally constituted by five judges published joint reasons in Haritos v Federal Commissioner of Taxation (Haritos). The decision was clearly intended to end disputation as to how that expression should be construed. Haritos has since been accepted as authoritative in respect of similar language governing appeals from tribunals by state courts and the NSW Civil and Administrative Tribunal. 
8	In this short paper I discuss the two main bodies of authority that preceded Haritos, canvass a few points in relation to the reasoning in that case and explore its impact on cases that have followed it. I conclude by offering some words of what I hope is useful advice.
Section 44 and Pre-Haritos Case Law
9	Unlike superior courts of the Australian states, the Federal Court has only ‘such original jurisdiction as is vested in it by laws made by the Parliament’. Under s 19(2) of the Federal Court of Australia Act 1967 (Cth) (Federal Court Act), the Federal Court’s original jurisdiction includes any jurisdiction vested in it to hear and determine appeals from decisions of persons, authorities or tribunals other than courts. An example of such jurisdiction is that which has been vested in the Federal Court to hear appeals from decisions of the Administrative Appeals Tribunal by s 44 of the AAT Act.
10	Section 44 does not apply to certain migration decisions. Such decisions may be challenged by engaging the supervisory jurisdiction of the Federal Circuit Court, which is expressed to be of the same nature as the constitutionally entrenched supervisory jurisdiction of the High Court under s 75(v) of the Constitution: see s 476(1) of the Migration Act 1958 (Cth). 
11	To obtain such relief an applicant needs to show the decision was affected by jurisdictional error, a threshold not required by s 44 of the AAT Act. 
12	Section 44 of the AAT Act should be read with r 33.12 of the Federal Court Rules 2011 (Cth) (Federal Court Rules). The rule requires the appellant to identify “the precise question or questions of law to be raised on the appeal” and “briefly but specifically, the grounds relied on in support of the relief or variation sought”.
13	Prior to Haritos, two contrasting schools of thought evolved with respect to what the words a ‘question of law’ under s 44 of the AAT Act conveyed. Each approach had its ongoing adherents. No settled line of authority became consolidated. Individual judges, and counsel appearing before them, drew support for their rival approaches from conflicting Full Court decisions. 
The Birdseye Position
14	The leading decision supporting a narrow approach to the question was the 2003 case of Birdseye v Australian Securities and Investments Commission (Birdseye). Birdseye stood for the proposition that only a pure question of law conferred jurisdiction on the Court. In Birdseye the AAT had refused an applicant an extension of time within which to apply for review. The notice of appeal to the Federal Court had then identified the relevant question of law as being whether certain considerations that had been referred to in the Tribunal’s decision had been relevant to the exercise of the Tribunal’s discretion under the AAT Act.
15	The Federal Court in Birdseye, Branson and Stone JJ (with Marshall J generally agreeing), gave effect to Gummow J’s reasoning in TNT Skypack International (Aust) Pty Ltd v Federal Commissioner of Taxation, holding that “[t]he existence of a question of law is now not merely a qualifying condition to ground the appeal, but also the subject matter of the appeal itself”. 
16	Their Honours expressed agreement with Ryan J in Australian Telecommunications Corporation v Lambroglou that “[i]f the question, properly analysed, is not a question of law no amount of formulary like “erred in law” or “was open as a matter of law” can make it into a question of law”.  
17	Accordingly a question of law “should be stated with precision as a pure question of law” and the notice of appeal must draw “links between the question of law, the circumstances of the particular case and the orders sought on appeal”.
18	In holding that the propositions the applicant had advanced as questions of law had failed to engage the court’s jurisdiction Branson and Stone JJ made the following observations (at [24]-[26]): 
The precise question of law intended to be stated … is unclear. Neither party contended that the validity of the order of the Board cancelling the applicant's registration as an auditor would be directly affected if the decision of the respondent to apply for the order were set aside. The applicant contended, however, that if the decision of the respondent to apply for the order were set aside, the Board might exercise a power to revoke its order cancelling the applicant's registration as an auditor. The applicant placed reliance on s 33(3) of the Acts Interpretation Act 1901 (Cth) in contending that the Board had the power to revoke its order. 
At best the question stated at par 2.2 of the notice of appeal would seem to be a question of mixed fact and law inviting: 
(a) consideration of whether the Board has power to revoke an order cancelling a person's registration as an auditor; and 
(b) assuming that the Board has that power, speculation as to how the Board might exercise the power in the circumstances of this case should the decision of the respondent be set aside. 
So read the connection between the question stated in par 2.2 of the notice of appeal and the decision of the Tribunal is tenuous …
19	The deficient notice of appeal not only did not comply with the requirements of o 53 r 3 (now r 33.12) of the Federal Court Rules but also it had failed to identify a pure question of law. That flaw deprived the Federal Court of the right to exercise jurisdiction conferred by s 19(2) of the Federal Court Act. The existence of a pure question of law was both the subject of and a precondition for a valid appeal under s 44 of the AAT Act. In its absence the Federal Court of Australia had no jurisdiction. 
20	The strict test of what constituted a question of law determined by Birdseye was from then on routinely applied in numerous other Federal Court and Full Federal Court decisions.
The Collins Position
21	Some four years after Birdseye was decided, a differently constituted Full Court of the Federal Court of Australia in Collins v Administrative Appeals Tribunal reached a differently nuanced conclusion with respect to its central proposition. Collins involved an appeal from a decision of the AAT affirming a decision of the Repatriation Commission to refuse the applicant’s claim for a widow’s pension under the Veterans’ Entitlements Act 1986 (Cth). 
22	The respondent, relying upon Birdseye and the line of cases that had followed it, argued that, even if the Tribunal had entered into an area of prohibited fact-finding, its conduct in doing so was incapable of raising a question of pure law as required for the purposes of s 44 of the AAT Act. Allsop J (as he then was; Lindgren and Emmett JJ agreeing) rejected that submission. His Honour remarked:
Nothing in any of the cases … gainsays the proposition that a properly framed question of law directing the Court’s attention to the manner in which the Tribunal failed to discharge its obligations according to the law under s 120(3) can be the subject of an “appeal” under the AAT Act. All those cases were directed at the necessity for there to be a proper and precise framing of a “question of law” to found the statutory authority of the Court under s 44 of the AAT Act to dispose of the appeal. Nothing in these cases limits the reach of s 44 to questions of law divorced from the need to look at facts. If, as here (on the hypothesis put forward on behalf of Mrs Collins), the Tribunal has begun a process of fact finding by preferring some evidence to other evidence or by rejecting conflicting material in the formation of its opinion as to reasonable hypothesis, it would have exceeded the statutory task required of it under s 120(3) of the Veterans Act. There can be no doubt that a properly framed question of law raising that legal error would be the legitimate subject of an "appeal" under s 44 of the AAT Act. All the cases relied upon were dealing with what has become an endemic problem in the failure of applicants in appeals under s 44 to frame the question as a question of law, including, but not limited to, the practice of raising of factual issues or simply expressing subject matter to set the outer limits of debate before the Court.
23	While Collins did not challenge the conclusion in Birdseye, that the existence of a question of law was a pre-condition for the Federal Court exercising jurisdiction to determine an appeal under s 44, it diverged in that it rejected the premise that a only a question of pure law could be a question of law for that purpose. Collins accepted that a properly framed question of law could include that which asserted error in the application of the law governing how the AAT was authorised to undertake fact finding.  
Reasoning in Haritos
24	Given those conflicting decisions of Full Courts there was ongoing uncertainty as to how judges at first instance should approach the construction of s 44. In 2010 Collins was followed by a Full Court (Dowsett and Gordon JJ, with Edmonds J agreeing) in Commissioner of Taxation v Train Bros Steel & Plastics Pty Ltd. However even that did not resolve the conflict. In 2013 a subsequent Full Court in Mulherin v Federal Commissioner of Taxation applied Birdseye without citing Collins. 
25	To resolve this confusion a Full Court in Haritos was exceptionally constituted by five judges (Allsop CJ, Kenny, Besanko, Robertson and Mortimer JJ). 
26	The unanimous judgment is lengthy. Fortunately, for practitioners whose interest understandably is likely to be focussed more on the outcome than the detail of their Honours’ reasoning, the Full Court summarised its conclusions concisely (at [62]) as follows: 
1)	The subject matter of the Court’s jurisdiction under s 44 of the AAT Act is confined to a question or questions of law. The ambit of the appeal is confined to a question or questions of law. 
2)	The statement of the question of law with sufficient precision is a matter of great importance to the efficient and effective hearing and determination of appeals from the Tribunal.
3)	The Court has jurisdiction to decide whether or not an appeal from the Tribunal is on a question of law. It also has power to grant a party leave to amend a notice of appeal from the Tribunal under s 44.
4)	Any requirements of drafting precision concerning the form of the question of law do not go to the existence of the jurisdiction conferred on the Court by s 44(3) to hear and determine appeals instituted in the Court in accordance with s 44(1), but to the exercise of that jurisdiction.
5)	In certain circumstances it may be preferable, as a matter of practice and procedure, to determine whether or not the appeal is on a question of law as part of the hearing of the appeal. 
6)	Whether or not the appeal is on a question of law is to be approached as a matter of substance rather than form.
7)	A question of law within s 44 is not confined to jurisdictional error but extends to a non-jurisdictional question of law.
8)	The expression “may appeal to the Federal Court of Australia, on a question of law, from any decision of the Tribunal” in s 44 should not be read as if the words “pure” or “only” qualified “question of law”. Not all so-called “mixed questions of fact and law” stand outside an appeal on a question of law.
9)	 In certain circumstances, a new question of law may be raised on appeal to a Full Court. The exercise of the Court’s discretion will be affected not only by Coulton v Holcombe (1986) 162 CLR 1 considerations, but also by considerations specific to the limited nature of the appeal from the Tribunal on a question of law, for example the consideration referred to by Gummow J in Federal Commissioner of Taxation v Raptis (1989) 20 ATR 1262 that there is difficulty in finding an “error of law” in the failure in the Tribunal to make a finding first urged in this Court.
10)	Earlier decisions of this Court to the extent to which they hold contrary to these conclusions, especially to conclusions (3), (4), (6) and (8), should not be followed to that extent and are overruled. Those cases include [Birdseye; Australian Securities and Investments Commission v Saxby Bridge Financial Planning Pty Ltd; Comcare v Etheridge; HBF Health Funds and Hussain v Minister for Foreign Affairs]. 
27	In expressing those conclusions, the Full Court nonetheless reiterated its concerns regarding the importance of a question of law being clearly stated, at [94]: 
In our opinion, the issue must be approached as one of substance. In cases of doubt, the Court should consider the notice of appeal, the alleged question or questions of law, the grounds raised, the statutory context, and the Tribunal’s reasons for its decision, and having considered all those matters, satisfy itself that there is in fact a question of law.
 		Their Honours then added:
The court has power to strike out a notice of appeal in reliance on s 44 of the AAT Act where the notice does not state a question of law. A notice of appeal under s 44 of the AAT Act invokes the original jurisdiction of the Court. 
However, this is not to say that the Court has no jurisdiction unless there are one or more questions of law set out in the notice of appeal. Neither is it to say that the great importance of the question or questions of law being stated with precision goes to the jurisdiction of the Court in the sense that absent a precise statement of the question the Court has no jurisdiction. The Court commonly will insist on the notice of appeal stating with sufficient precision, or being amended to state with sufficient precision, a question of law. But as an ordinary incident of its status as a superior court of record (see s 5 of the FCA Act), the Court has jurisdiction to decide whether or not has jurisdiction. This carries with it authority to decide whether a notice of appeal states a question of law and does so with sufficient precision and, if it does not, whether an appellant should have leave to amend the notice of appeal to remedy the defect…
28	Thus, as their Honours in Haritos re-affirmed, to merely begin a question with “whether the Tribunal erred in law” will never be sufficient to transform a question of fact into one of law.
29	But, where the notice of appeal states questions of law that seem deficient but may have substance, how is that problem to be resolved? 
30	According to Haritos the court must resolve any case of doubt by considering the notice of appeal, the alleged question or questions of law, the grounds raised, the statutory context, and the Tribunal’s reasons for its decision, and having considered all those matters, satisfy itself that there is in fact a question of law.  
31	The duty imposed by Haritos on the judges of the Federal Court to look beyond mere form to substance rather than simply rejecting an ill-expressed notice of appeal will undoubtedly be of benefit to unrepresented litigants unable to articulate their legal grievance with precision.
32	It should not encourage practitioners to take less care in drafting notices of appeal, trusting that the Court will, in any event, reformulate a poorly expressed notice to identify whatever may be an appropriate question or questions of law. That would increase the work of the Courts and put an unjustifiable strain on public resources.
Post-Haritos case law and observations
33	Following Haritos there have been many instances of the judges of the Federal Court earnestly wrestling with ill-expressed grounds to identify and crystallise any substantive question that might properly be articulated as a question of law. 
34	An instructive example is Berry v Commissioner of Taxation (Berry). Berry concerned a purported appeal against an AAT decision to dismiss Mr Berry’s application for review because he had failed to proceed with his application and had not complied with the AAT’s directions within a reasonable time. The respondent Commissioner objected on the basis that the appeal was not competent. 
35	Justice Davies rejected the Commissioner’s submission. Her Honour accepted that, as drafted, “the form of each of the questions is a generalised statement which contains no relevant content to enliven the jurisdiction of the Court under s 44 of the AAT Act”. It therefore did not comply with r 33.12(2) of the Federal Court Rules. However, she reasoned, Haritos required the Court to proceed on the basis that “[w]hether or not there is a question of law raised by the Notice of Appeal cannot be determined by the form of the questions themselves”. The Court was duty bound to approach the issue of whether an appeal raised a question or questions of law as a matter of substance, not of form. 
36	Accordingly, despite the Notice of Appeal being plainly defective, the Court’s jurisdiction had been properly invoked, Davies J reasoned: 
Although the questions themselves are uninformative, legal matters for determination on appeal can nonetheless be distilled from the particulars supporting the grounds. From those particulars, it can be seen that Grounds 1-4 are each directed at the nature and scope of the Tribunal’s power under s 42A(5) of the AAT Act, Ground 5 at whether there was a denial of procedural fairness and Ground 6 at whether the decision is vitiated by apprehended bias. Each of them raises issues of law for determination. It should not be taken, however, that the objection to competency was without foundation. As stated, the questions posited as the questions of law did not expressly state any questions of law at all, let alone state questions of law with precision as the Federal Court Rules require. The Notice of Appeal is plainly defective in that the questions of law are only revealed by the grounds, and it should not be thought that it is acceptable to submit a notice of appeal in that form. 
37	However, the result did not avail the applicant. Justice Davies, having identified each of the unarticulated substantive questions of law found to be capable of being distilled from the materials before her, gave brief substantive reasons addressing their respective lack of merit.  
38	Mr Berry’s appeal, based on her Honour’s reframed questions, was dismissed because no legal error on the part of the Tribunal had been shown. 
38	Similarly, in Crown Estates (Sales) Pty Ltd v Commissioner of Taxation (Crown Estates) Logan J accepted the Federal Court had jurisdiction to consider grounds which might have been raised on the materials before the Court, notwithstanding that no question of law had been identified in the applicant’s amended notice of appeal. 
39	Logan J took it upon himself to set out all of the possible questions of law that could have been the foundation for a legitimate notice of appeal. His Honour then gave reasons, answering each such hypothesised question in the negative. 
40	Berry and Crown Estates are but two of many decisions which have applied Haritos. They illustrate that in practice there is tension between the Haritos’ exhortation that a question or questions of law should be stated with precision and the Haritos command that the threshold jurisdictional issue, of whether or not an appeal is on a question of law, is to be decided as a matter of substance rather than of form. 
41	However the observations of Buchanan, MeKerracher, Katzmann JJ in Westrupp v BIS Industries Ltd should serve as a warning to practitioners in this regard (at [15]-[16]): 
No objection was raised to the competency of the appeal and there is no doubt that the appeal raises questions of law in some respects. That said, however, there are a number of deficiencies with the notice of appeal. A mere allegation that the Tribunal erred in law in making (or not making) a particular finding is not to state a question of law (Australian Telecommunications Corporation v Lambroglou, approved by the Full Court in Haritos v Federal Commissioner of Taxation). Most of the asserted questions appear to do no more than that.
It is not always easy to identify a question of law, yet the Court has repeatedly stressed the importance of stating the question or questions of law with precision, most recently in Haritos. The existence of a question of law is not just “a qualifying condition to ground the appeal”, it is the very subject matter of the appeal (TNT Skypak International (Aust) Pty Ltd v Federal Commissioner of Taxation). An appeal “on a question of law” is an appeal limited to a question of law...
Conclusion
42	In Haritos, a unanimous Full Court, exceptionally constituted by five members, rejected the tension between the precision the court continued to demand of practitioners in framing their questions of law, and the Court’s duty to identify what is a question of substance concealed in the poorly expressed grounds. Thus far, the experience has been that the courts have been more focussed on the latter than the former. The hope of Haritos towards heightened diligence of practitioners has not been reflected in matters to date.
43	However, scrambled grounds of appeal remain at risk of being thrown out by the court.
44	Thus in Fard v Secretary, Department of Immigration and Border Protection (Fard), the applicant identified what Griffith J referred to as various “purported questions of law”.  His Honour observed, inter alia, that one of the questions stated as a question of law involved pure speculation by the applicant that a different finding of fact would have led to a different outcome by the Tribunal. In regards to another of the “questions of law” his Honour stated:
The sixth question of law simply asserts that the visa … is a “false document”. On its face, this is not a question of law but rather involves an assertion of fact. The Court has no jurisdiction in respect of such a claim in circumstances where no error of law was identified in respect of the AAT’s findings and observations.
Justice Griffiths accordingly dismissed the notice of appeal and ordered costs against the applicant.
45	Decisions such as Fard should not be ignored.
46	A practitioner who fails to identify the relevant question(s) of law with precision and who instead drafts a muddled and poorly expressed notice of appeal not only loses his or her opportunity to frame the issue(s), but also risks a busy judge overlooking a potentially winning point. Haritos’ statement that primacy is to be given to substance over form does not absolve practitioners of their salient duty.
47	There is a critical forensic advantage in framing an appeal question. A practitioner who frames the questions of law in terms they want the court to focus upon begins a conversation with the Court on his or her client’s terms. 
48	A practitioner will have only him or herself to blame if as a result of a carelessly drafted notice of appeal he or she leaves a judge to articulate what the judge believes to be the question of substance because of their own failure to do so and, in consequence, discovers the judge has answered that question in the negative.
49	Finally, it would be most unwise to ignore the concluding words Haritos. That passage, summarising the Full Court’s conclusion set out above at [26], is to the effect that the Federal Court has authority to decide whether a notice of appeal states a question of law and if it does not, whether an appellant should have leave to amend the notice of appeal to remedy the defect. It is implicit in those words not only that leave may be granted; it may be refused.
50	While the course of post-Haritos decision making has as yet given little attention to those observations, a practitioner who displays gross carelessness in drafting a notice of appeal risks his or her professional competence becoming the occasion for such attention and provoking an unwelcome post-Haritos judicial exposition at his or her client’s expense concerning whether and in what circumstances such leave should not be granted.
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