APPEALS FROM DISCRETIONS, SATISFACTIONS AND VALUE JUDGMENTS: REVIEWING THE HOUSE RULES.

• Date: 01 December 2017
• Author: Edmonds, Chris

The general rules governing appeals seem well settled. Where the decision challenged involves the exercise of a discretion, broadly described to include states of satisfaction and value judgments, the principles developed in House v The King apply. Under the House rules, the appellant must identify either specific error of fact or law or inferred error (eg where the decision is unreasonable or clearly unjust). However, beneath this apparently settled framework, the law raises complex and unresolved issues. That the court should exercise such restraint is periodically challenged. The House rules in themselves are of limited value in identifying how appeals from discretionary decisions differ from appeals generally. What constitutes the exercise of a 'discretion', what is the relationship between the exercise of a 'discretion' and the making of a 'value judgment', and what rules respectively apply are the subject of conflicting decisions. Whilst the House appears presentable, internally it requires attention.

Contents I Introduction II Appeals from Discretionary Decisions A The Elements of a Discretionary Decision B The Rules Governing an Appeal from a Discretionary Decision C Application of the House Rules in Analogous Situations 1 Decision-Maker's 'Satisfaction' 2 Application of the Law to the Facts (Limited Appeals) 3 Judicial Review of Discretionary Administrative Decisions III The State of the House A A House Built on Sand? B The Court's Approach Generally on Appeals C The House Rules Reconstituted IV Criticism of the Court's Restrictive Approach A Hutley's Analysis B Discretionary Creep C 'Discretion' Properly So Called V Discretions and Value Judgments and Confusion A England's (Sometimes) Distinction B Value Judgments in the High Court C A House Divided VI Discretionary Decisions: A Revised Approach. A England's (Current) Approach B The New Zealand Model VII Summary: 'Formulae of Futile Casuistry' A The Existing Formulae B Reworking the Formulae C The 'Dao' of Appellate Review of Discretionary Decisions. I INTRODUCTION

A formula for judicial review of administrative action may afford grounds for certitude but cannot assure certainty of application. Some scope for judicial discretion in applying the formula can be avoided only by falsifying the actual process of judging or by using the formula as an instrument of futile casuistry. It cannot be too often repeated that judges are not automata. The ultimate reliance for the fair operation of any standard is a judiciary of high competence and character and the constant play of an informed professional critique upon its work. (1)

The argument made here is that whilst courts have developed a body of principles and rules regulating appeals from discretionary decisions (broadly described), these principles are in various respects poorly defined, of limited utility, or in conflict. In part, this instability in the formulation and application of such rules reflects an inherent tension where legislation both confers a power on a tribunal (2) to make a subjective choice and also provides a right of appeal from that choice. That requires a court (3) to exercise judgment as to the appropriateness of it intervening, in particular as to whether its decision will provide a more just outcome. In part also, it reflects the inherent complexity of the subject. There is heavy traffic at this intersection: the nature of the appeal, issues of fact and law, primary facts and inferences, discretion, satisfaction, value judgment, rule-application, deference, reasonableness, proportionality and rationality. The passage quoted above also alludes to the tension between the requirements of the profession (and tribunals) for certainty, and of the courts for flexibility in resolving the particular issues before them. Finally, there is uncertainty arising from developments in related areas, particularly judicial review of administrative discretionary decisions. There is evidence that some of the established principles governing appeals of discretionary decisions are being reassessed, tentatively in Australia and England and more radically in New Zealand. This has largely escaped informed professional critique. (4)

Part II outlines the nature and scope of appeals from 'discretionary' and related decisions and the (House) rules (5) applying to them. Part III explains limitations in the House rules and suggests how the rules might be reconstituted. Part IV refers to criticism of the court's restrictive approach to appeals from discretionary judgments. Part V describes the concept of a 'value judgment', the absence of settled principles applying to the respective concepts of discretionary judgments and value judgments, and the resulting confused state of the law. Part VI examines both a new approach to the subject explored in England and the model adopted in New Zealand. Part VII reaches some conclusions on how the principles governing appeals might, in some respects, be reformulated and integrated.

II APPEALS FROM DISCRETIONARY DECISIONS

In both a 'general appeal' (a right of appeal by rehearing on both fact and law) and a 'limited appeal' (a right of appeal by 'rehearing' confined to a question or error of law) from a discretionary decision, (6) identification of error in the tribunal's exercise of discretion is the basis upon which the court will uphold the appeal. Outside the limitations imposed by public law on the exercise of discretionary powers, (7) courts in England and Australia have, as a matter of judicial policy, exercised considerable restraint in intervening in decisions characterised as involving the exercise of a discretion. This is primarily on the basis that Parliament has determined that the tribunal which is vested with the power to make the relevant decision should do so according to what it (that is, the tribunal) regards as the most appropriate outcome in the particular circumstances. It is also on the basis that reaching finality in litigation is important and that, having regard to the nature of the decision under consideration, the court may be in no better position to resolve the matter than is the tribunal.

In examining the state of the law on this subject, it is necessary first, by reference to established principles, to identify the elements of a discretionary decision, the rules governing when the court will intervene in such a decision and the extent to which these rules apply in analogous situations.

A The Elements of a Discretionary Decision

Some statements of principle on the first of these subjects were provided by the High Court in Norbis v Norbis, a case concerning the equitable distribution of property between parties to a failed marriage:

'Discretion' signifies a number of different legal concepts ... Here the order is discretionary because it depends on the application of a very general standard --what is 'just and equitable'--which calls for an overall assessment in the light of the factors mentioned in [the statutory provision], each of which in turn calls for an assessment of circumstances. Because these assessments call for value judgments in respect of which there is room for reasonable differences of opinion, no particular opinion being uniquely right, the making of the order involves the exercise of a judicial discretion. The contrast is with an order the making of which is dictated by the application of a fixed rule to the facts on which its operation depends.

The principles enunciated in House v The King were fashioned with a close eye on the characteristics of a discretionary order in the sense which we have outlined. If the questions involved lend themselves to differences of opinion which, within a given range, are legitimate and reasonable answers to the questions, it would be wrong to allow a court of appeal to set aside a judgment at first instance merely because there exists just such a difference of opinion between the judges on appeal and the judge at first instance. In conformity with the dictates of principled decision-making, it would be wrong to determine the parties' rights by reference to a mere preference for a different result over that favoured by the judge at first instance, in the absence of error on his part. According to our conception of the appellate process, the existence of an error, whether of law or fact, on the part of the court at first instance is an indispensable condition of a successful appeal. (8) Under this analysis, exercise of a 'discretion' and the attachment of the House rules may extend to the application of a general standard, a value judgment in which there is room for reasonable differences of opinion and a value judgment otherwise not governed by the application of a fixed rule to the facts as found. (9)

B The Rules Governing an Appeal from a Discretionary Decision

The rules governing when a court will upset a discretionary decision were settled in House v The King. (10) The accused brought a general appeal (then) as of right under s 73 of the Constitution (ie an appeal strictly so called), against a sentence of imprisonment for a bankruptcy offence. The joint judgment (Dixon, Evatt and McTiernan J J) treated sentencing as involving the exercise of a 'judicial discretion'. (11) Drawing upon English and Australian authorities, they held that

[i]t is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed ... It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the...