A useful review of the authorities where a decision maker fails to address a material issue or material evidence and whether it amounts to a constructive failure to exercise jurisdiction.
8. The belated formulation of this ground appears to have owed something to the reasoning of this Court in Goodwin v Commissioner of Police  NSWCA 379 at -. In particular, the grounds picked up the language of Gummow and Callinan JJ in Dranichnikov v Minister for Immigration and Multicultural Affairs  HCA 26; 77 ALJR 1088 at  that “[t]o fail to respond to a substantial, clearly articulated argument relying upon established facts was at least to fail to accord Mr Dranichnikov natural justice”. Similar language was adopted by the Full Court of the Federal Court (North, Logan and Robertson JJ) in LVR (WA) Pty Ltd v Administrative Appeals Tribunal  FCAFC 90; 289 ALR 244. The Full Court stated at , that the Tribunal, by simply adopting one party’s submissions as it reasons, “had failed to bring its own mind to bear on the issues before it and thus … had constructively failed to exercise its jurisdiction”: see also at .
9. The adoption, on an appeal limited to errors in point of law, of language derived from the supervisory jurisdiction of the court must be undertaken with caution. It is, no doubt, an error of law for the trial court to fail to exercise its constitutional function, which is to resolve a dispute presented to it by the parties by applying the law in accordance with proper procedure. In the present case, that function was almost entirely satisfied by the resolution of disputed factual issues. The term “constructive failure to exercise jurisdiction” is used to describe a situation where the court has purported to resolve the parties’ dispute but has not in fact done so. Thus, particularly with a court or tribunal required to provide reasons for its decision, it may become apparent from those reasons that a material issue has simply not been addressed or that material evidence has been overlooked. Examples of circumstances which may properly give rise to a concern on this kind were referred to by Gummow ACJ and Kiefel J in Minister for Immigration and Citizenship v SZMDS  HCA 16; 240 CLR 611 at . On occasion, the function of the decision-maker (which should include a court) has been identified as being to “give proper, genuine and realistic consideration to the merits of the case”: Kahn v Minister for Immigration and Ethnic Affairs (1987) 14 ALD 291 (Gummow J). (The language probably derived from its use in equity to describe the proper exercise by a trustee of a discretionary power in relation to the trust.) Although the nature of the exercise, particularly with respect to discretionary powers, involves no bright-line boundary, care must be taken that the statutory mandate of the appellate court, limited to errors of law, is not breached by adopting as a standard inherently value laden language: see Minister for Immigration and Citizenship v SZJSS  HCA 48; 243 CLR 164 at .
Brisbane Barrister – David Cormack