21 June 2004
Key Points:
If a NSW claim of misfeasance in public office goes ahead, grey areas of the tort could be clarified.
The tort of misfeasance in public office is an accepted part of the law, but there are still many grey areas in the tort and the case law is not very well developed. A case underway in New South Wales could give valuable guidance on misfeasance when it is alleged that the decision-maker acted maliciously to harm the plaintiff using otherwise lawful powers.
Sending a letter under the Food Act
NSW Health prosecuted Sunraysia for offences under the NSW Food Act relating to its labelling, a prosecution which was largely unsuccessful.
It also sent a letter to the Australian Supermarkets Institute, which did not specifically require the removal of Sunraysia's products from its members' shelves, but warned that:
"As Sunraysia is based in Victoria, direct action against the company is difficult for NSW Health. Action is therefore likely to be taken against a retail outlet selling the products in question."
Sunraysia then instituted action, claiming that NSW Health did not have power under the Food Act to send the letter and that it had committed misfeasance in public office. NSW Health sought to have Sunraysia's claim struck out. The case went to the NSW Court of Appeal: Sunraysia Natural Beverage Company Pty Ltd v State of New South Wales [2004] NSWCA 16.
The evolving state of misfeasance
The tort of misfeasance in public office is still evolving, as the Court of Appeal acknowledged, and is therefore a complex area of law with some uncertainties. As a general proposition, there can be misfeasance where a person holding public office purportedly exercises his or her powers, but knows that this act is beyond his or her powers (or is recklessly indifferent), and there is a foreseeable risk of harm to an identifiable person.
The Court of Appeal said it was not persuaded that Sunraysia could argue that the sending of the letter was unauthorised, in the sense that it lacked any necessary foundation in statute or the general law.
There is another type of misfeasance: targeted malice. With this type of misfeasance, a holder of a public office has the power to do an act, but does it with the intent to harm the plaintiff or a class of which the plaintiff is a member. This statement is based on Lord Millett's formulation in Three Rivers District Council v Governor and Company of the Bank of England (No 3) [2003] 2 AC 1.
The unclear part of this formulation is the statement that the act can be within power, but the public servant's intent alone makes it misfeasance. There is no Australian authority which either supports or contradicts this proposition. In Sanders v Snell (1998) 196 CLR 329, which is the High Court's most recent discussion of misfeasance, the court described the tort of misfeasance as a balancing act: too low a standard of liability, and public officials may be deterred from exercising powers conferred on them when their exercise would be for the public good, and too high a standard may leave persons affected by an abuse of public power uncompensated. "Not surprisingly, identifying the intention with which the public official acts has a prominent place in striking that balance." In that case, there was no evidence of intent, with the result that the High Court did not need to develop this point more fully.
As the NSW Court of Appeal pointed out, whatever the law of Australian actually is on this point this did not have to determined at this stage. Sunraysia only had to show that its claim was arguable. Its claim that the public servant abused his position in sending the letter and in doing so intended to cause harm to the claimant and acted in a way that the law would regard as malicious was not clearly untenable. The Court of Appeal said this seemed to be an attempt to plead targeted malice, and on that basis allowed it to replead to make this clear.
What if Lord Millett is right?
If Australian courts fully embrace Lord Millett's formulation – and this is at the core of Sunraysia's claim – then misfeasance in public office could be a more attractive route to challenging administrative decisions than the traditional avenues of administrative law. This is because Lord Millett's formulation does not require the plaintiff to show that the public servant did not have the power to act, merely that the act was motivated by the requisite intent. Administrative law by contrast is generally not concerned with the decision-maker's motives, unless there is an allegation of actual or apprehended bias.
Making a claim of misfeasance in public office and proving it are two different things, of course. As with allegations of actual bias in administrative law, an allegation that a decision-maker has used a lawful power for unlawful ends are quite difficult to prove.
For further information, please contact John Carroll.
