VH-HYB, on track between Mildura and Griffith, en route to Sydney, was maintaining non-standard Flight Level 380. The non-standard level was approved by air traffic control to help the aircraft avoid turbulence. UTA 147, flying on the same track in the opposite direction was maintaining Flight Level 350 but requested a climb to Flight Level 370. This request was immediately approved by air traffic control Sector 4. An adjacent controller noticed the altitude readout on UTA 147 as Flight Level 363 when both aircraft were about 10 nautical miles apart nose to nose.
He immediately called out to the Sector 4 controller who was engaged in coordination. Before the UTA 147's altitude clearance could be amended to Flight Level 360, to achieve the required 2000 feet vertical separation, the pilot of UTA 147 read back "maintaining Flight Level 370". The controller immediately attempted to pass traffic information to UTA 147 but because of language difficulties, the information was not understood before both aircraft had passed with the reduced separation of 1000 feet.
