Comparative Study: Merits Review and Judicial Review in Australian Law

This essay critically analyzes the relationship between merits review and judicial review of administrative decisions, focusing on the Australian legal context and Peter Cane's proposition that there is no stark difference between the two. The essay begins by defining merits review and judicial review, hi...Read More

RUNNING HEAD: Submission of Assignment
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MERIT REVIEW AND JUDICIAL
REVIEW

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Table of Contents
Introduction................................................................................................................................2
Merits Review............................................................................................................................2
What is merits review.............................................................................................................3
Differentiating with Judicial Review.........................................................................................4
Can Merits review be disguised as Judicial review...................................................................5
Conclusion..................................................................................................................................7
Bibliography...............................................................................................................................8
Article/Book/Journal..............................................................................................................8
Legislatures............................................................................................................................8
Cases......................................................................................................................................8
Others.....................................................................................................................................9

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Introduction
In this paper the reviewer reviews the proposition that Peter Cane submitted asserting that no
stark difference can be observed between judicial review and merits review of administrative
decision taking, instead he argued merits review can be disguised as judicial review”.1 Peter
Cane vehemently argues that both merit review and judicial review are interchangeably used,
so the author studies this proposition in this paper.
The author provides a critical analysis of the above proposition and submits arguments for
and against the said proposition. The author discusses about merits review and judicial review
and how the both are different in their functioning and how cannot be interchanged or merged
with one another. The reviewer also talk about whether merits review has changed in two
decades and whether the proposition of Peter Cane falls true in this era too.
Merits Review
Surprisingly, outside Australia, large literature about federal administrative systems have kept
them aloof from analysing the facets of ‘merits review’ or non-judicial review and therefore
can only describe it by differentiating it with judicial review as per federal administrative
structure. But it can be said that judicial review and merits review both are not mutually
exclusive. In practise judicial review concentrates on the legality and while merit review
takes in to consideration the merits of administrative decisions.2 Once it is believed that there
1 Peter Cane, ‘Merits Review and Judicial Review- The AAT as Trojan Horse’, (2000) 28 Federal Law Reviews
213.
2P Bayne , “The Commonwealth System of Non-Judicial Review” (1989) Canberra Bulletin of Public
Administration 43; Johnson v Federal Commissioner of Taxation (1986) 72 ALR 625.

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are no barriers between issues of fact and issues of law the differences between
administrative bodies and judicial bodies also seems blurry.
What is merits review
With the increase in transaction between the government and its citizens in Australia, post-
war, a momentum started taking shape for administrative law forum. Post war the
developments were directed towards improving and protecting the citizens as the Aiustralian
government saw a large number of decisions affecting citizens so administrative bodies were
set up as a means to ‘test correctness and value of these decisions taken by government’.
Since judicial review was an expensive and technical process which did not focus on merits
of the decision, which the individuals had desired the most in those times. So administrative
bodies were set up in Australia to provide the solution and meet with the objective.
Australia adopted the concept of tribunals carrying administrative functions from England.
Merits review in layman language is a technique where decision is reconsidered by the
executive. The merit review board reviews the original decision taken by executive and on
the same facts of the case frame a new decision if it disagrees with the earlier decision or it
can also agree with the previous decision. As held in Drake v Minister for Immigration and
Ethnic Affairs, Chief Justice Bowen and Justice Deane held that the merits to be considered
before a tribunal are that “whether the decision and the material available before the tribunal
upon which the tribunal ponders over is a correct or preferable one”.3 For example as per
Part IVC of The Taxation Administration Act 1953, taxable income wrongly assessed by
Commissioner of Taxation in Australia can be appealed against before the Administrative
Appeals Tribunal (hereinafter called as ‘AAT’) for merits review. And AAT can decide on
merits based on the evidence available before it.4
3 (1979) 46 FLR 409.
4 The Taxation Administration Act 1953 , Cth, Part IVC.

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So in essence judicial review is a review conducted by judicial bodies like courts, tribunals
etc. and merits review refers to those review conducted by administrative bodies. 5 Presently
administrative review system facilitates review of more than 350 legislative enactments and
in the year 1998-99 received more than 35000 applications, since then the number has only
increased.6
Differentiating with Judicial Review
As discussed above it is clear that judicial review as a power can only be exercised by courts
and not administrative bodies. It can also be understood as that elementary principle which
the courts apply when they are deciding on an administrative issue under the ambit of judicial
review where the court are at liberty to consider the legality of issue before its hand and not
its merit.7 In order to differentiate between the administrative and judicial issue a balance
between issue of law and issue on merits of a particular decision has to be drawn and applied
by a judicial mind. It has to be kept in mind that the Courts entertain judicial review when
there is an error of law and not a procedural error or an error of fact. Since there is no single
principle which can help determine and differentiate between the issue of law or the issue of
fact or that of policy in a particular case, as it is different in every case, thus a it is left for the
interpretation of a judge to determine the issue and what one judge may find an issue of law
the other may not and vice versa. Thus judicial review and merits review could be seen
intermingling into one another often and it can be said that both are not mutually exclusive.
The judicial review ensures that the decision made by the earlier judicial body or court was
made within the legal limits and within relevant power. And if the court comes to a
conclusion that the power was usurped or the decision was formed on wrong law or
unlawfully made or incorrect interpretation of law was done, the remedy lies in setting aside
5 Collector of Customs (NSW) v Brian Lawlor Automotive Pty Ltd (1979) 2 ALD 1.
6 Supra note 1.
7 Minister for Immigration and Ethnic Affairs v. Guo (1997) 191 CLR 559 at 577.

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the order and remitting it back to the previous court of law for reconsideration. And once the
matter is remitted back to the original court the court reconsiders the matter and forms a new
decision. And in some cases the courts have limited jurisdiction, where they can only judge
on the law and whether the law was aptly applied, and if there arises any issue of facts, the
courts remit the matter back to the original court. However in merit review the jurisdiction of
administrative body is ousted and the decision maker has an option to reconsider the matter
without remitting it back to the original decision maker.
Can Merits review be disguised as Judicial review
In Australian law at both levels i.e federal as well as state levels, merits review has been
understood as a mode of non-judicial or administrative adjudication, distinct from judicial
review. Also as per the principles of separation of power which are enshrined in the
Australian Constitution and interpreted by the Court who have remarked that there is a stark
difference between judicial review and merits review.8
The distinction is clear with respect to the procedural and remedial elements found in merits
review whereas as judicial review traces the line of substance or error of law and not
procedural irregularity. The courts while exercising judicial review are exercising their
inherent powers whereas the administrative bodies are exercising proxy powers that are being
allocated to the decision maker for the particular case.9
On one hand the judicial reviewer carries out the negative task i.e the basic function of
identifying defects in earlier decision and now under review whereas on the other hand the
basic function of merits reviewer perform a positive task of finding out the correct and
8 Brandy v Human Rights and Equal Opportunity Commission (1995) 183 CLR 245.
9 Kavvadias v The Commonwealth Ombudsman (No 2) (1984) 6 ALD 198.

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preferable decision. Thus a merit reviewer can be called a decision maker however the
judicial reviewer cannot be called so as he is not making a decision rather he is finding a
defect and amending it. Illegality, error apparent on the face of law, unreasonableness, etc.
are few of the grounds of judicial review and are all expressed in negative terms whereas the
grounds for availing merit review are in positive terms where the reviewer has to decide
whether the decision under review is the correct or preferable one.10 A merit reviewer
basically has to screen the earlier decision and find if it is a preferable decision or not and can
exercise his powers of passing a favourable decision only if the decision for review before
him is not a preferable decision. 11 In merit review an administrative decision maker reviews
decision of the original decision maker and substitutes it with his own by considering and
revisiting the facts, policies again and a new decision is made and achieving a favourable
decision is the ultimatum.12 Whereas in judicial review the courts ponder upon the lawfulness
of a decision, apply their judicial mind as per the prevailing law and orders to quash the
earlier decision if it is faulty. In judicial review the courts do not express their opinion
whether the previous decision is preferable or not. 13
However in state laws the distinction between merit review and judicial review find no place
as in principle, as the tribunals exercise both judicial as well as non-judicial powers
simultaneously.14 In practise the Australian merit reviewers are as willing as courts to
question government policy and for these purposes there are laws drafted in Australian States
to limit the freedom of merit reviewers to protect them from departing from government
policy.15
10 Shi v Migration Agents Registration Authority (2008) 235 CLR 286
11 Re Brian Lawlor Automotive Pty Ltd and Collector of Customs (NSW) (1978) 1 ALD 167.
12 Ibid at 7.
13 Brandy v Human Rights and Equal Opportunity Commission (1995) 183 CLR 245
14 Judicial Review and Merits Review (23 March 2020) <
https://openresearch-repository.anu.edu.au/bitstream/1885/54307/26/Judicial%20Review%20and%20Merits
%20Review_Full%20Version.pdf>
15 Secretary, Department of Social Security v Alvaro (1994) 34 ALD 72.

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Conclusion
With the introduction of merit review system in Australia the interaction between government
and citizen was strengthened as citizens preferred a body to challenge the decisions of
government and to verify correctness of government’s decisions since judicial review was
very technical and did not provide a decision on merits. Thus the objective of merits review
system is to verify the correctness of the decisions of government whereas judicial review
focussed more on law and legality of decision.
Though at times at state level there are adjudicatory bodies like tribunals and courts that
exercise both merits and judicial review. But the proposition of Peter cane that merit review
and judicial review pose no stark difference and merit review can be disguised as judicial
review does not fall true in this era. Judicial review and merits review have been widely
distinguished and vary in their operation. In judicial review the reviewer quashes the decision
if it finds it erroneous whereas merit reviewers rarely remit for reconsideration.
Judicial review is exercise of an inherent power by judicial bodies and whereas merit review
bodies are bodies exercising non-judicial power. Even though both are enforcing legal
decision making powers but the differences between them are more significant. The legality
of the decision is the purview of judicial review whereas the fact and evidentiary value are
main focuses of merit review, if both are used interchangeable it would result in injustice and
could create a mess.
Certainly one is a specialist i.e Court and other is a generalist body i.e administrative body
yet there appear such stages at state level where both the bodies have to act and sometimes at
state levels they are also so interwoven that it is difficult to differentiate between the two. But

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the author denies with the proposition of Peter Cane of both being disguised as one but
certainly agrees that both are not mutually exclusive.

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Bibliography
Article/Book/Journal
Bayne P, “The Commonwealth System of Non-Judicial Review” (1989) Canberra Bulletin
of Public Administration 43.
Cane Peter, ‘Merits Review and Judicial Review- The AAT as Trojan Horse’, (2000) 28
Federal Law Reviews 213.
Legislatures
The Taxation Administration Act 1953 .
Cases
Brandy v Human Rights and Equal Opportunity Commission (1995) 183 CLR 245.
Collector of Customs (NSW) v Brian Lawlor Automotive Pty Ltd (1979) 2 ALD 1
Drake v Minister for Immigration and Ethnic Affairs, (1979) 46 FLR 409.
Kavvadias v The Commonwealth Ombudsman (No 2) (1984) 6 ALD 198, 206.
Johnson v Federal Commissioner of Taxation (1986) 72 ALR 625.
Minister for Immigration and Ethnic Affairs v. Guo (1997) 191 CLR 559 at 577.
Re Brian Lawlor Automotive Pty Ltd and Collector of Customs (NSW) (1978) 1 ALD 167.
Secretary, Department of Social Security v Alvaro (1994) 34 ALD 72.
Shi v Migration Agents Registration Authority (2008) 235 CLR 286

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Others
Judicial Review and Merits Review (23 March 2020) < https://openresearch-
repository.anu.edu.au/bitstream/1885/54307/26/Judicial%20Review%20and%20Merits
%20Review_Full%20Version.pdf>