Australia: Two air operators grounded following fatal crash

Public law report

On 20 August 2010, the Civil Aviation Safety Authority (CASA) cancelled the Air Operator's Certificates (AOC) of both Avtex Air Services Pty Ltd (Avtex) and Skymaster Air Services Pty Ltd (Skymaster) following a fatal crash involving an aircraft operated by Skymaster which was attempting to make an emergency landing on Canley Vale Road near Bankstown Airport. An AOC is a permission granted by CASA to conduct certain commercial aviation activities.

In Avtex Air Services Pty Ltd v Civil Aviation Safety Authority [2011] AAT 61, Senior Member Fice of the Administrative Appeals Tribunal (Tribunal) affirmed CASA's decision to cancel Avtex's AOC having accepted evidence of a serious and imminent risk to air safety and breaches of conditions of Avtex's AOC, partly arising from the issues raised in an audit of Skymaster's operation.

Associated companies

Under the Civil Aviation Act 1988 (Cth) (the Act), CASA must be satisfied that certain key personnel in an organisation to which an AOC is granted have appropriate experience in air operations to conduct or to carry out the AOC operations safely. The expression "key personnel" is defined under s28(3) of the Act and it means the people, however described, that hold, or carry out the duties of the following positions in the AOC holder's organisation:

  1. the chief executive officer
  2. the head of the flying operations part of the organisation
  3. the head of the aircraft airworthiness and maintenance control part (if any) of the organisation
  4. the head of the training and checking part (if any) of the organisation
  5. any other position prescribed by the regulations.

With the exception of the position of the head of flying operations, Avtex and Skymaster shared the key personnel required by the Act. The companies also had common shareholders and operated out of the same hangar.

It was common ground between the parties that if Skymaster's AOC was cancelled, the operations of Skymaster could have immediately been transferred to Avtex.

Suspension and cancellation of AOC

In May 2010, CASA issued Avtex with a notice of proposed action to vary, suspend or cancel its AOC under s28BA of the Act following suspected breaches of the conditions of Avtex's AOC.

Prior to Avtex responding to the s28BA notice, an accident occurred that resulted in CASA conducting a special audit of Skymaster's operations and concluded that if Skymaster were to continue its operations under its AOC, that would result in a serious and imminent risk to air safety. That conclusion constituted grounds for CASA to vary, suspend or cancel Skymaster's AOC under s30DI of the Act. CASA also formed the view that, in light of the close relationship between Avtex and Skymaster, if Avtex continued its operations under its AOC, that would also result in a serious and imminent risk to air safety.

In applying the evidence raised in the audit of Skymaster's operations to determine the risk to air safety posed by Avtex, the Tribunal focussed on the influence that the common key personnel had on the safety of air operations of both entities. Despite the fact that the entities had different heads of flying operations, who had the responsibility to ensure that the operator's air operations were conducted in compliance with the Act and regulations, the Tribunal determined that it was inevitable that there would be some overlap of the two operations because of common key personnel. Further, there was evidence that the other key personnel had a dominant and negative influence on the respective heads of flying operations.

Despite Avtex's assertions otherwise, the Tribunal found that there was a significantly large overlap between the companies as a result of common key personnel, that the findings in the Skymaster audit were relevant to whether the continued operation of Avtex under its AOC would result in a serious and imminent risk to air safety.

Cancellation valid on two grounds

The Tribunal has jurisdiction to review decisions made by CASA which are described as reviewable decisions under s31 of the Act. The cancellation of a certificate granted or issued under the Act, such as an AOC, is a reviewable decision.

The first question for the Tribunal to determine was whether Avtex's operations presented a serious and imminent risk to air safety, if they were to continue. If that was found to be the case, CASA's decision to cancel the AOC under s30DI of the Act could be affirmed.

CASA also submitted that if the facts did not support such a finding, then the Tribunal should exercise other powers or discretions open to it, such as under s28BA(3) of the Act to make a decision that Avtex's AOC should be cancelled as a result of breaches of the conditions of its AOC. CASA had relied on s28BA(3) of the Act in its original show cause notice when considering whether to vary, suspend or cancel Avtex's AOC. Although Avtex responded to that show cause notice, CASA did not in fact make a decision under s28BA(3) of the Act as subsequent events, namely, the Canley Vale Road accident, heightened CASA's concerns to the extent that it proceeded under s30DI of the Act on the grounds of serious and imminent risk to air safety.

CASA cited the decision of Hill J in Secretary, Department of Social Security v Hodgson (1992) 108 ALR 322 as an example of the Tribunal's broad interpretation of the power granted to the Tribunal under s43(1) of the Administrative Appeals Tribunal Act 1975 (Cth). That section empowers the Tribunal to exercise all the powers and discretions conferred upon the original decision maker provided it does so for the purpose of reviewing a decision.

Although the decision under review was CASA's decision to cancel Avtex's AOC under s30DI, Senior Member Fice said there was clearly an association between the power which could have been exercised under s28BA(3) of the Act and the decision under review. Therefore, in exercising all the powers and discretions conferred upon the original decision-maker for the purposes of reviewing the cancellation decision, as an alternative to finding a serious and imminent risk to air safety, the Tribunal should also examine whether conditions of Avtex's AOC were breached and whether those breaches, if found, should result in a cancellation decision.

The evidence disclosed that the operations of both Skymaster and Avtex were unsafe and that Avtex had committed numerous breaches of the conditions of its AOC. Therefore, CASA's decision to cancel Avtex's AOC could be affirmed based on either of the two relevant sections of the Act, despite the original decision being based on s30DI of the Act alone.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Mondaq Advice Centre (MACs)
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.