Decision-makers will need to be particularly careful about procedural fairness, following yesterday’s High Court decision in Nathanson v Minister for Home Affairs  HCA 26, which has underscored that almost any failure to afford it will be “material” and void the decision.
Materiality – what is required
The High Court’s previous decision on “materiality”, MZAPC v Minister for Immigration and Border Protection (2021) 95 ALJR 441, held:
- for an Applicant to make out a jurisdictional error, he or she must first of all establish that the exercise of the statutory power in issue involved the breach of an express or implied condition of procedural fairness;
- once established, the Applicant must then demonstrate that the error was material to the ultimate outcome of the decision. Otherwise, the legal error would not amount to a jurisdictional error of the sort which a Court would set aside or redress; and
- to establish materiality, the Applicant must show that there was a "realistic possibility" that a different decision could have been made had the obligation to afford procedural fairness been complied with. This is a question of fact which the Applicant must establish on the balance of probabilities – by inferences drawn from the totality of the evidence before the Court.
The issue in Nathanson was exactly what an Applicant would need to show to establish there was a "realistic possibility", in the context of an admitted failure to afford procedural fairness.
The Nathanson case: what is a “realistic possibility”?
The central error made by the Administrative Appeals Tribunal in this case was that it had failed to draw to Mr Nathanson’s attention that a particular consideration that had been raised in the course of the Tribunal hearing (and not identified as being relevant prior to the hearing) would be relevant to its decision, and had failed to give Mr Nathanson an opportunity to address that consideration. It was conceded that this amounted to a failure to afford Mr Nathanson procedural fairness.
In his appeal to the High Court, Mr Nathanson argued that he was not required to prove or establish what he would have done if he had been provided with a fair opportunity to be heard in relation to the substantive issue giving rise to the conceded procedural fairness error. All that he needed to establish, as a matter of reasonable conjecture, was that there was a realistic possibility that the outcome may have been different.
All six justices decided to allow the appeal, with Chief Justice Kiefel and Justices Keane and Gleeson providing joint reasons and Justices Gageler, Gordon and Edelman providing separate reasons.
Two matters are noteworthy from the joint reasons of Chief Justice Kiefel and Justices Keane and Gleeson:
- as a point of principle, where the Tribunal errs by denying a party a reasonable opportunity to present their case, "reasonable conjecture" does not require demonstration of how that party might have taken advantage of that lost opportunity; what is required is a consideration of how the Tribunal made its decision and a determination, on the balance of probabilities, as to whether its decision could have been different if procedural fairness had been afforded;
- as a matter of practicality, it will generally be the case that there is a realistic possibility that a decision-making process could have resulted in a different outcome if a party was denied an opportunity to present evidence or make submissions on an issue that required consideration. Their Honours noted that the rationale for procedural fairness is that, given a fair opportunity to present their case, a party will take advantage of that opportunity and that, by doing so, the party may achieve a favourable outcome.
Their Honours found that, had Mr Nathanson been aware of the additional consideration that fell for the Tribunal’s assessment, he could have led additional evidence and made additional submissions which could realistically have affected the Tribunal’s evaluative fact-finding and, ultimately, the outcome of the Tribunal’s review.
Implications for administrative decision-makers
This decision reaffirms the importance of affording procedural fairness in the context of administrative decision-making, indicating that a failure to afford procedure fairness will generally be material and result in the decision being set aside.
Accordingly, administrative decision-makers should continue to ensure that parties are always given a reasonable opportunity to present their case, including by:
- presenting information and submissions to the decision-maker in support of an outcome that supports his or her interests;
- allowing the party to provide further information to rebut or qualify, and submissions to comment upon, adverse material from other sources which is put before the decision-maker; and
- requiring the decision-maker to identify to the person affected any issue critical to the decision which is not apparent from its nature of the terms of the statute under which it is made, including advising of any adverse conclusion which would not obviously be open on the known material.