In NRM Corporation Pty Ltd v Australian Competition and Consumer Commission  FCAFC 98, the Full Court endorsed the (long-standing) proposition that one should be cautious in making active findings of witness untruthfulness.
 It should nevertheless be accepted at the outset that a finding that a witness has been “untruthful” attracts a necessary exercise of judicial caution: cf. Smith v New South Wales Bar Association (1992) 176 CLR 256 at 268. Justices Brennan, Dawson, Toohey and Gaudron there observed:
It is particularly important in disciplinary cases, where the honesty and candour of legal practitioners assume special significance, that the distinction between the rejection of a person’s evidence and a positive finding that he or she deliberately lied be observed. The mere rejection of evidence can neither justify a consequence over and above that which properly attaches to the matter charged, nor deprive the person of the benefit of personal considerations which might otherwise be taken into account. The matter was put succinctly, although in a different context, by Cussen J in R v Richmond ( VLR 9 at 12):
It would certainly act as a deterrent even to an innocent man giving evidence, especially where there is a strong case against him, if he knew that if the jury does not accept his evidence he may receive a sentence heavier than otherwise would be imposed.
A finding that a person deliberately lied when giving evidence is, in effect, a finding of perjury and, thus, it ought not to be made on “the single oath of another man, without any confirmatory evidence.
 Where there has been “significant delay” [in providing reasons], it has been said that “it is incumbent upon a trial judge to inform the parties of the reasons why the evidence of a particular witness has been rejected”: Expectation Pty Ltd v PRD Realty Pty Ltd  FCAFC 189 at  per Carr, Emmett and Gyles JJ.
In Re Zheng and Minister for Immigration and Citizenship (2011) 121 ALD 372, Deputy President Forgie of the AAT referred to the obvious proposition that a witness being untruthful in one aspect of his or her evidence does not mean that the entirety of the witness’s evidence is untruthful. Similarly, there is an important distinction between evidence not being credible, and the witness not being credible. There was extensive discussion of this at -.
These are important reminders of how decision-makers must not rush to condemn witnesses and applicants as outright liars, as is far too often the case. Whether misconceived, over-zealous findings of adverse credibility might lead to jurisdictional error is yet to be fully-explored, but questions of reasonableness appear to be relevant. In BTF15 v Minister for Immigration and Border Protection  FCA 647, Katzmann J criticised a finding that witnesses fabricated evidence as ‘unreasonable’. At , her Honour said:
I am troubled by the Tribunal’s conclusion that the statements of the two witnesses were fabricated. It is one thing to find that evidence should not be given any weight. It is quite another to conclude that evidence is a fabrication. The High Court has said in a different context that “as a matter of logic and common sense, something more than mere rejection of a person’s evidence is necessary before there can be a positive finding that he or she deliberately lied in the giving of that evidence”: Smith v New South Wales Bar Association (1992) 176 CLR 256 at 268 (Brennan, Dawson, Toohey and Gaudron JJ). The Tribunal was entitled to find that the evidence of the two witnesses could not overcome the inconsistencies in the appellant’s account. It was unnecessary and inappropriate, however, for the Tribunal to go further and find that their evidence was a fabrication: Smith at 271–2 (Deane J). In the circumstances, that finding was unreasonable. It should not have been made.
About 11 years earlier, the Federal Court observed in Minister for Immigration & Multicultural & Indigenous Affairsv Maltsin  FCAFC 118 at  that the damning of witnesses other than the applicant might be a jurisdictional error, in at least two distinct ways:
… It was, however, unfair in the circumstances to condemn as dishonest a group of individuals, some of whom had and some of whom had not prepared statements for the Tribunal, in circumstances where they had no chance at all to answer such an accusation, especially as the basis for the finding of dishonesty was not self-evident.
Mahon v Air New Zealand may also provide some support for the proposition that, where the rules of procedural fairness apply, they control the hearing before the relevant administrative body generally and, at least in some circumstances, may enure for the benefit of persons other than an applicant: see, however, the discussion in Re Hurd and Hewitt  120 DLR (4th) 105, reversing Hurd v Hewitt (1991) 13 Admin LR (2d) 223. Although each of these authorities is distinguishable from the present case, each indicates that it is at least arguable that a denial of procedural fairness to a person other than an applicant before the Tribunal may in some circumstances impinge on the validity of the ultimate decision. Alternatively, this may be a case in which the Tribunal’s “web of deceit” finding so lacked any reasonable foundation that, to adopt the language of Allsop J in NADH of 2001 v Minister for Immigration and Multicultural and Indigenous Affairs  FCAFC 328 (“NADH of 2001“) at :
“To assert conclusions of this kind in this way may be seen as not to engage in a reasoning process, but to assert conclusions by a process that is no more than an intuitive, arbitrary or capricious response to the task.”
In view of the errors already identified, however, it is unnecessary to determine whether a failure to act fairly as regards the respondents’ family and friends could amount to a jurisdictional error that would vitiate the decision, or an error of the kind described by Allsop J in NADH of 2001.
In Bax v Minister for Immigration & Multicultural & Indigenous Affairs  FCAFC 55 the Full Federal Court observed at :
The circumstances here were such as to make applicable what, in Mahon v Air New Zealand Ltd  1 AC 808, Lord Diplock identified as one of the rules of natural justice. His Lordship said at 821:
“The second rule requires that any person represented at the inquiry who will be adversely affected by the decision to make the finding should not be left in the dark as to the risk of the finding being made and thus deprived of any opportunity to adduce additional material of probative value which, had it been placed before the decision-maker, might have deterred him from making the finding even though it cannot be predicted that it would inevitably have had that result. (Original emphasis.)”
See also Re Refugee Tribunal; Ex parte Aala (2000) 204 CLR 82, at 116 [par 78], (Gaudron and Gummow JJ) and 121 [par 101] (McHugh J). In Aala (supra), at par  McHugh J said:
“One of the fundamental rules of the fair hearing doctrine is that a decision-maker should not make an adverse finding relevant to a person’s rights, interests or legitimate expectations unless the decision-maker has warned that person of the risk of that finding being made or unless the risk necessarily inheres in the issues to be decided.
The Full Federal Court in CQG15 v Minister for Immigration and Border Protection  FCAFC 146 concluded:
It may be accepted that cases such as SZNPG and Smith do make the point that, unless it is strictly necessary, it is preferable not to reach a conclusion that an applicant is a “liar”. But while this is indeed sound practice, the remarks do not suggest that the Tribunal will have fallen into jurisdictional error if it does reach such a finding. There was ample foundation in this instance for the Tribunal to reach the conclusion that the appellant was not a witness of truth.
However, that observation does not preclude that sometimes a finding that a person has ‘lied’ might be unreasonable, and for that reason, a jurisdictional error.