- Although government officers should be alert to the possibility of tort claims for misfeasance, good government decision-making should be business as usual.
Claims against government for the tort of misfeasance in public office appear to be on the rise. Usually, persons affected by government actions or decision-making will seek public law remedies. For example, where a person's interests are affected by a government decision that is made in excess of authority, the person might seek to have the decision set aside by a court. Where physical or economic harm has been caused by government actions or decisions, the injured person might seek compensation under a private law tort action. For example, where a government officer has exercised powers or functions negligently, the injured person might seek damages for the injury suffered.
The tort of misfeasance crosses this public/private divide: it is a private tort for damages, but it will only be established where there has been an unauthorised exercise of government powers or functions. It will often be claimed in combination with an action in negligence, but it is a "deliberate" tort in the sense that liability does not arise unless there is an intention to cause harm or the officer concerned knowingly acts in excess of his or her power. In other words, it will only arise where there is bad faith or malice in government actions or decision-making. Thus, the circumstances giving rise to a successful claim are very different to those giving rise to an action for negligence.
Along with other actions against government, claims of misfeasance in public office may increase in tougher economic times. However, the elements of this tort are hard to prove and actions against government officers are rarely successful. Good faith government actions and decision-making will not give rise to liability under the tort, even if they arise from an invalid exercise of power or functions. More has to be shown for an action to be successful: there has to be bad faith or malice in government action or decision-making. Accordingly, although government officers should be alert to the possibility of such claims, good government decision-making should be business as usual. This article discusses the elements of the tort and identifies areas where uncertainties remain.
Elements of the tort
The tort of misfeasance is often described as "well established", however, its precise limits are still undefined. The following elements of the offence are often referred to: (i) an invalid or unauthorised act, (ii) done maliciously, (iii) by a public officer, (iv) in the purported discharge of his or her public duty, and (v) which causes loss or harm to the plaintiff.
i. An invalid or unauthorised act or omission
Misfeasance in public office requires a purported exercise of power that is invalid. Liability does not arise where an act or omission is done or made in a valid exercise of a power. Furthermore, liability does not arise simply because a purported exercise of power is ultra vires and damage was caused. More than mere invalidity of action must be shown.
In addition to invalidity, liability for misfeasance in public
office requires a particular state of mind - bad faith or malice.
However, it is not entirely settled what is sufficient to
constitute malice for these purposes. It is clear that an actual
intention to cause harm constitutes malice (often referred to as
"targeted malice"). Additionally, knowledge of
invalidity, or recklessness as to the existence of power, when
coupled with an additional element can constitute malice for the
purposes of the tort. However, it is not entirely clear what that
additional element is. It is probably the case that the additional
element will include knowledge that the invalid exercise of power
will cause injury or recklessness as to whether that injury will
result. However, it has not been completely ruled out that
foreseeability of injury might be sufficient.
No liability arises where damage has been caused by an invalid act, but the public officer acted in good faith and without knowledge of the invalidity.
iii. Public officer
The meaning of "public officer" is yet to be precisely
defined. Nevertheless, previous cases provide some guidance as to
the scope of the concept. On the one hand, some courts have taken a
fairly broad approach: anyone who is appointed to discharge a
public duty and who receives remuneration. On the other hand, other
courts have taken a narrower approach: the holder of an office must
owe duties to members of the public and, thus, not all government
employees would be covered.
Clear examples of public officers in the decided cases include government ministers and Commissioners of Police. Examples in the cases where persons were considered not to be public officers include counsel appointed to assist a board of inquiry or royal commission, and a private barrister and instructing solicitor prosecuting an offence. That the concept is unclear is demonstrated by the decision in the recent case of Noori v Leerdam  NSWSC 515, where it was held to be arguable that a solicitor representing the Commonwealth in administrative review proceedings was a public officer.
iv. Purported exercise of a public duty
The power in question that has purportedly been misused must relate to, or be attached to, a public duty. The meaning of "public duty" for the purposes of misfeasance has not been clearly determined. It seems that the power exercised may not need not be public in nature. If this is the case, an action in misfeasance could lie, for example, in relation to a contractual exercise of power by a public body.
v. Loss or harm
Damage, loss or harm to the plaintiff must be proved in order for an action in misfeasance to succeed. Damage is not limited to adverse effects upon a plaintiff's person or property. It can include a disadvantage or loss which the plaintiff would not, or might not, have suffered if the power had been validly exercised. Damages may also be claimed for pure economic loss.
The need for an antecedent relationship?
One issue that remains unresolved at the High Court level is whether, in addition to the requisite state of mind, it is necessary to show a connection between the plaintiff and the alleged tortfeasor. For example, does the plaintiff have to show an antecedent relationship with the alleged tortfeasor? Specifically, can a person who is not the subject of regulation, or whose interests are not immediately identifiable with the regulatory scheme in question, claim relief against an alleged tortfeasor for misfeasance in connection with the administration or enforcement of the regulatory scheme?
That question has been considered by a number of Australian and overseas courts, with differing views being expressed on the issue. Thus, it is unclear whether an antecedent relationship between a plaintiff and an alleged tortfeasor is a necessary element to be established to give rise to liability. This aspect of the tort, along with many others, remains to be resolved at the High Court level.
Misfeasance and public law
In the recent case of Commissioner of Taxation v Futuris Corporation Limited  HCA 32, the High Court emphasised the affinity between the tort of misfeasance in public office and the public law concept of lack of bona fides giving rise to jurisdictional error. That affinity, the majority said, "reflects the precept that in a legal system such as that maintained by the Constitution executive and administrative power is not to be exercised for ulterior or improper purposes".
In Futuris, the question for the Court was whether an income tax assessment was invalid as a result of alleged misfeasance by the Commissioner of Taxation in making the assessment. Although the Taxation Administration Act 1953 (Cth) sets out a system for the review of tax assessments, this action was initially instituted in the judicial review jurisdiction of the Federal Court conferred by section 39B of the Judiciary Act 1903 (Cth). For a remedy to be ordered in that jurisdiction, a decision has to be affected by jurisdictional error. Section 175 of the Income Tax Assessment Act 1936 (Cth) provides that: "The validity of any assessment shall not be affected by reason that any of the provisions of this Act have not been complied with". The majority held that, because of section 175, errors in the process of assessment do not go to jurisdiction and so do not attract the remedy under section 39B of the Judiciary Act. However, despite this conclusion, the Court emphasised that decision-making that involved bad faith or malice would not be protected by section 175.
Thus, misfeasance in decision-making can give rise to a private tort claim against the officer acting in bad faith or with malice, and also can give rise to a claim that the decision be set aside for invalidity. Even where statutory schemes seek to confer protection for decisions against invalidity, bad faith in government decision-making is likely to render the decision invalid.
Government officers should be alert to the consequences of misfeasance, and should adopt good practices of public administration to minimise the risks of such claims arising. However, claims for misfeasance arise in rare circumstances, and good government decision-making should be business as usual.
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.