An onus of ‘almost nothing’: Nathanson v Minister for Home Affairs
Brandon Smith
14.09.2022
The High Court has once again entered the fray on the concept of materiality in Nathanson v Minister for Home Affairs [2022] HCA 26 (Nathanson). This time, the Court clarified the evidentiary burden imposed on a judicial review applicant to show the realistic possibility of a different outcome where there is a denial of a fair opportunity to be heard. While the appeal was allowed 6:0 from the majority judgment of the Full Court of the Federal Court (Steward and Jackson JJ), the High Court has again divided on the question of onus for materiality. While this decision arises in the context of decision-making under the Migration Act 1958 (Cth), it may have broader ramifications for judicial review applications involving issues of procedural fairness.
The state of play on materiality
The term ‘materiality’ first came to prominence in the High Court's 2018 decision in Hossain v Minister for Immigration and Border Protection. There, the majority (Kiefel CJ, Gageler and Keane JJ) identified a common law principle of statutory interpretation that decision-making under statutes is ‘ordinarily to be interpreted as incorporating a threshold of materiality in the event of non-compliance’ (at [29]). The majority continued that this ‘threshold of materiality would not ordinarily be met’ if a failure to comply with a statutory condition could have made no difference to the outcome of a decision (at [30]).
In Minister for Immigration and Border Protection v SZMTA (2019), the majority (Bell, Gageler and Keane JJ) sought to define what is meant by a ‘material’ breach of a statutory condition, and who bore the onus of proof. The majority concluded that a ‘breach is material … only if compliance could realistically have resulted in a different decision’, such question of materiality being an ‘ordinary question of fact in respect of which the applicant bears the onus of proof … determined by inferences drawn from evidence adduced on the application’ (at [45]-[46]).
The issue of onus was addressed again by a 7-member bench in 2021 in MZAPC v Minister for Immigration. By a slim 4-3 majority (Kiefel CJ, Gageler, Keane and Gleeson JJ), the High Court confirmed that it was the applicant who bore the onus of proving ‘on the balance of probabilities the historical facts necessary to enable the court to be satisfied of the realistic possibility that a different decision could have been made had there been compliance with that condition’ (at [39]).
It is in this context that the facts in Nathanson gave rise to particularly tricky issues for the majority's position in MZAPC, particularly what the ‘onus of proof’ for materiality means in the context of a denial of a fair opportunity to be heard.
The facts in Nathanson
The challenge in Nathanson concerned a denial of procedural fairness by the Administrative Appeals Tribunal (AAT). The AAT affirmed a decision of a delegate of the Minister under s 501CA(4) of Migration Act to refuse to revoke the mandatory cancellation of Mr Nathanson's visa under s 501(3A) because he did not satisfy the character test in s 501(6).
The delegate's task under s 501CA(4) was originally guided by Ministerial Direction 65. Direction 65 required the delegate to have regard to three primary considerations, one of which was the 'protection of the Australian community from criminal or other serious conduct'. However, by the time of the AAT hearing, Direction 65 had been replaced by Ministerial Direction 79. One relevant change was the insertion of a new subparagraph 13.1.1(1)(b) stating that ‘crimes of a violent nature against women or children are viewed very seriously, regardless of the sentence imposed’. The AAT was required to apply Direction 79, not Direction 65.
Before the AAT, Mr Nathanson was aware that two alleged incidents of domestic violence against his wife were generally relevant to the AAT's review, including because he was cross-examined generally on those incidents (to which he made qualified admissions) and because he filed a letter of support from his wife partially in response to those incidents. However, importantly, Mr Nathanson was told by the AAT that the new Direction 79 made only ‘minor changes’, and that changes relating to how Direction 79 treated crimes where women and children are involved were ‘of minor relevance’ to the Tribunal's task.
Despite this, the Minister's closing submissions relied on the new subparagraph 13.1.1(1)(b) of Direction 79, arguing the domestic violence incidents were ‘extremely serious conduct’. These submissions were relied upon by the AAT in affirming the decision under review. The domestic violence incidents, when considered with a history of other violent offences, were said to weigh strongly against the discretion to revoke the mandatory cancellation decision.
Both the primary judge and the majority of the Full Court accepted that the failure of the AAT to afford Mr Nathanson an opportunity to respond to the Minister's closing submission and misleading the applicant as to the ‘minor relevance’ of subparagraph 13.1.1(1)(b) denied Mr Nathanson procedural fairness. However, relying upon SZMTA and MZAPC, both found that there was no jurisdictional error, as Mr Nathanson failed to point to any particular evidence or submissions he could have made to discharge the onus of proof to show there was a realistic possibility of a different outcome. In particular, they rejected Mr Nathanson’s contentions that further evidence from himself or his wife, or further submissions as to the weight to be given to the domestic violence, including when considered amongst other evaluative factors such as the best interests of minor children, could have realistically resulted in a different outcome.
A High Court divided
While the appeal from the Full Court's decision was allowed 6:0, the High Court was divided on the correct approach and threshold to the onus of establishing the realistic possibility of a different outcome.
A split in the MZAPC majority
The reasons of the plurality (Kiefel CJ, Keane and Gleeson JJ) emphasised that the standard of ‘reasonable conjecture’ required by MZAPC is ‘undemanding’, and in the case of a denial of an opportunity to be heard, it ‘does not require demonstration of how that party might have taken advantage of that lost opportunity’. Rather, the plurality remarked the standard of ‘reasonable conjecture … proceeds on the assumption’ that a party would have taken advantage of a fair opportunity to be heard and that ‘by doing so, the party could achieve a favourable outcome’ (at [33]).
The plurality drew an analogy to Stead v State Government Insurance Commission (1986), in which a plaintiff's counsel was prevented by the trial judge from submitting that a witness's evidence should be disbelieved. The plurality remarked that in Stead, the ‘possibility of a different outcome’ was apparent on the face of the trial record, that those were the only historical facts needed to prove materiality, and that the same could be said of the AAT's reliance on subparagraph 13.1.1(1)(b) of Direction 79 in its reasons (at [34]).
Justice Gageler split from the plurality, which otherwise constituted the majority in MZAPC. Justice Gageler focussed on his Honour's statement with Gordon J in Minister for Immigration and Border Protection v WZARH at [60] to the effect that where the procedure adopted by an administrator fails to afford a fair opportunity to be heard, a denial justifying relief is established by ‘nothing more than that failure’ (at [41]). Explained in light of SZMTA and MZAPC, Gageler J restated that a denial of procedural fairness will be material if the applicant can establish the reasonableness of conjecture (within the bounds of the historical facts) that the decision could have been different, unless there was something in the historical facts suggesting otherwise (at [55]).
Justices Gordon and Edelman – an unprincipled approach to judicial review, a question of values and the quadruple ‘might’
Justices Gordon and Edelman again raised spirited dissents to the approach to materiality required by MZAPC.
Justice Gordon was of the view this case provided a ‘very important opportunity’ for ‘revisiting’, and modifying, the onus of proof for materiality. Referring to the majority's statement in MZAPC that there will be certain categories of errors which will necessarily result in ‘a decision exceeding the limits of decision-making authority without any additional threshold [of materiality] needing to be met’, Gordon J remarked that a ‘serious denial’ of procedural fairness in relation to an evaluative decision was such a category of decision (at [76]). In such a case, Gordon J stated that there is not an ‘additional or separate onus’ on the applicant to establish materiality, and that requiring an applicant to point to submissions that would have been made or evidence that would be adduced ‘is not judicial review and … is not principled or practical’ (at [86]).
Justice Edelman commenced by noting that a fair opportunity to be heard is based on the value of natural justice and human dignity, values so fundamental that they require ‘plain words of necessary intendment’ before they can be removed by Parliament. That bedrock of statutory decision-making, Edelman J remarked, has been eroded by the majority approach in MZAPC, based on weaker underlying values of ‘efficiency’ or ‘good administration’ on which materiality is based (at [89]).
Turning to the issue on appeal, Edelman J identified the question for resolution as: ‘what more was Mr Nathanson required to do, beyond establishing a serious denial of procedural fairness, in order to have the decision set aside?’ (at [92]). On the majority's ‘regrettable premise’ in MZAPC, Edelman J concluded that the curious answer ‘was almost nothing’, with it sufficing for Mr Nathanson to make a ‘quadruple might’ submission: ‘there might have been things that he or his wife might have said at the hearing that might have assisted his case in a manner that might have led to a different result’ (at [94]).
Justice Edelman viewed this as a curious result which could be resolved by approaching the question of materiality in procedural fairness cases as follows (paraphrased from [95]):
1. The threshold question: Had Mr Nathanson established an error capable of producing ‘practical injustice’?
2. If there was practical injustice, had Mr Nathanson established that the procedural unfairness was sufficiently serious that it was, without more, material?
3. If the procedural unfairness was not of that degree of seriousness, had it been established that the denial could not have made any difference to the result?
The implications of Nathanson
An onus of ‘almost nothing’
One obvious implication of Nathanson is that a denial of procedural fairness in the form of a denial of a fair opportunity to be heard will almost always be material and jurisdictional, particularly in the context of evaluative decisions. The plurality at [33] stated that in cases where a party is denied a reasonable opportunity to present their case that ‘“reasonable conjecture” does not require demonstration of how that party might have taken advantage of that lost opportunity’, citing the following passage of Gageler and Gordon JJ in WZARH at [60]:
Where … the procedure adopted by an administrator can be shown itself to have failed to afford a fair opportunity to be heard, a denial of procedural fairness is established by nothing more than that failure, and the granting of curial relief is justified unless it can be shown that the failure did not deprive the person of the possibility of a successful outcome.
As the plurality remarked at [39], given the AAT’s evaluative task, ‘[t]here was no need for the appellant to establish the nature of any additional evidence or submissions that might have been presented’. As such, it appears that judicial review applicants will no longer be required, at least with specificity, to identify the types of submissions and/or evidence they could have led, and how such submissions or evidence could have resulted in a different outcome, had they had a fair opportunity to be heard. Rather, by analogy to cases such as Stead (discussed above), it will be open to judicial review applicant to invite the court to draw inferences as to an error’s materiality from the record of hearing or decision-making below. Arguably, as Edelman J notes, this is an onus of ‘almost nothing’ (at [93]).
That being said, the decision in Nathanson has not resolved all of the forensic difficulties faced by courts in understanding what must be led by a judicial review applicant to establish a ‘counterfactual conjecture of a realistic possibility’ of a different outcome (MZAPC at [52]). This is particularly so in cases of procedural unfairness (such as non-compliance with statutory requirement to give notice of relevant information under the Migration Act) falling short of a denial of a fair opportunity to be heard, which will require a difficult reconciliation of SZMTA, MZAPC and Nathanson. Nathanson has also not resolved the tight-rope courts face between drawing inferences of materiality and straying into a merits review of the decision challenged.
Indeed, despite the majority in MZAPC emphasising that materiality is to be decided within the metes and bounds of ‘historical facts’, until now in migration cases, courts have often resolved questions of materiality relating to procedural unfairness by reference to hypothetical submissions or evidence that would have been led by a judicial review applicant. For example, in Nahi v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs, the Full Court rejected an appeal as to the question of materiality of an alleged denial of procedural fairness because it was of the view that the further affidavit evidence the appellant would have adduced could not have changed the Tribunal's findings. As Edelman J noted, the reasons of the primary judge and majority of the Full Court in Nathanson, which engaged in a similar analysis to Nahi, were arguably ‘impeccable’ if the onus of materiality as developed in SZMTA and MZAPC was truly a ‘substantive onus’ (at [119]).
Will the reasoning in Nathanson be limited to a denial of an opportunity to be heard?
Another interesting implication of Nathanson is to consider whether the onus of ‘almost nothing’ on judicial review applicants may be extended to other aspects of procedural fairness, or even other types of errors, beyond a denial of an opportunity to be heard.
In MZAPC, the majority acknowledged there are certain categories of case, such as apprehended bias or unreasonableness, which do not impose a separate threshold condition of materiality (at [33]). It will be interesting to see whether the concept of a ‘serious’ denial of procedural fairness of which proof of materiality is not required (as separately suggested by Gordon J and Edelman J), will receive further traction.
While the three-question model suggested by Edelman J is attractive, it risks further muddying the waters while the question of onus for materiality remains unclear. With the continuing decline of reliance on distinct categories or grounds of review in judicial review applications, the application of different tests for materiality depending on the category of error may be fraught with danger. Further, beyond a denial of an opportunity to heard, the process of determining whether a denial of procedural fairness or non-compliance with a statutory condition is ‘serious’ may require difficult processes of characterisation with no bright lines. This is undesirable, particularly when one remembers that challenges to decision-making under the Migration Act are often undertaken by self-represented litigants with little to no understanding of the complexities of reviewable error in administrative law, let alone the concept of materiality.
The future of materiality
The future of materiality, particularly questions concerning onus, remain uncertain. With the upcoming retirements of Keane J (October 2022) and Kiefel CJ (January 2024), two of the strongest proponents of materiality, it will be interesting to see whether new High Court justices, alongside Gordon, Edelman and Steward JJ (who remain opposed to the current approach to materiality), could turn the tide on materiality.
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Brandon Smith is currently a lawyer at Allens, practising in commercial litigation and migration law (pro bono).
Suggested citation: Brandon Smith, ‘An onus of ‘almost nothing’: Nathanson v Minister for Home Affairs’ on AUSPUBLAW (14 September 2022) <https://www.auspublaw.org/blog/2022/09/an-onus-of-almost-nothing-nathanson-v-minister-for-home-affairs>